Dexus · ASX:DXS
Dexus — DEXUS Property Group — Q1 FY2014 Earnings Presentation
28 slides from Dexus's earnings presentation, Oct 22, 2013
Slide 1: DEXUS Property Group September 2013 Quarterly Update
DEXUS PROPERTY GROUP SEPTEMBER 2013 QUARTERLY UPDATE DEXUS Funds Management Limited ABN 24 060 920 783 DEXUS AFSL Property 238163 Group September as responsible 2013 Quarterly entity for DEXUS Update Property Group Slide 1
Slide 2: Agenda
AGENDA Overview Darren Steinberg Capital management Michael Christensen Portfolio update Kevin George, Richard Garing, Andy Collins, Mark Cuddy, Scott Travers, Amanda Kenny Strategy – core capabilities Jim Jones, Joseph Stokes Market outlook Peter Studley Summary Darren Steinberg DEXUS P
Slide 3: Overview: Key achievements for the quarter
OVERVIEW Key achievements for the quarter ended 30 September 2013 Capital Third party funds Property portfolio Transactions management management 67,592sqm CPA 30.9% DWPF 14.9% economic interest, Gearing outperformed its Leased in total1 lodged DXS/CPPIB proposal benchmark to 30 Sep 13 10.2% $71.5m
Slide 4: Capital Management
CAPITAL TITLE MANAGEMENT SLIDE HEADER 2013 Half Year DEXUS Property Group September 2013Results Presentation Quarterly Update — Slide 4 Slide 4
Slide 5: Capital Management Update
CAPITAL MANAGEMENT Update $245 million (5%) buy-back announced 2 July 13 Key metrics 30 Sep 13 30 Jun 13 Gearing 30.9% 29.0% — $75.3 million or 73.7 million securities bought back to date, 31% completed at weighted average price of $1.0211 Cost of debt 5.8%2 5.9%1 Duration of debt 5.2 years 5.4 ye
Slide 6: Portfolio Update
PORTFOLIO TITLE SLIDE UPDATE HEADER 2013 Half Year DEXUS Property Group September 2013Results Presentation Quarterly Update — Slide 6 Slide 6
Slide 7: Portfolio Update: Total DXS portfolio
PORTFOLIO UPDATE Total DXS portfolio Total DXS portfolio composition 84 1.8million sqm 4.8 stars Office Properties Net lettable area NABERS Energy $5.7bn 78% $7.3bn 94.5% 4.7 years2 7.6% Occupied1 WALE Average cap rate Industrial $1.6bn 22% 1. By area at 30 September 2013. Occupancy by income at 30
Slide 8: Office portfolio — solid operating performance
PORTFOLIO UPDATE Office portfolio — solid operating performance Achievements DXS office portfolio 30 Sep 13 30 Jun 13 Occupancy by area 94.7% 94.4% Achieved total return of 10.2% including 3.0% capital Occupancy by income 95.0% 94.6% return Number of leasing transactions1 45 130 Solid leasing ac
Slide 9: Office portfolio — lease expiry profile
PORTFOLIO UPDATE Office portfolio — lease expiry profile Lease expiry profile by income as at 30 September 2013 14% 13.2%1 12% 11.8% 10% 9.6%1 10.7% 9.5% 9.4% 8% 6% 5.4%1 5.6%1 5.0% 4.8% 4% 2% 0% Vacant FY14 FY15 FY16 FY17 FY18 1. 30 June 2013. DEXUS Property Group September 2013 Quarterly Update Sl
Slide 10: Office portfolio case study: Clarence Street, Sydney
PORTFOLIO UPDATE Office portfolio — case study 45 Clarence Street, Sydney Achieved total return of 12.1% for 12 months to 30 Sep 13 Leasing brought in-house in Sep 12 — Occupancy1 increased by 10.5% to 99% Utilised strong tenant and market relationships to relocate tenants from suburban market
Slide 11: Case study: Newly acquired Sydney CBD office properties
PORTFOLIO UPDATE Office portfolio – case study Newly acquired Sydney CBD office properties Secured a total of 23 new tenants1 over 9,839sqm across three properties since acquisition Occupancy2 increased through active management — 39 Martin Place from 74% to 94% — 50 Carrington Street from 61% t
Slide 12: Industrial portfolio
PORTFOLIO UPDATE Industrial portfolio Achievements DXS industrial portfolio 30 Sep 13 30 Jun 13 Occupancy by area 94.3% 95.9% Achieved total return of 8.9% Occupancy by income 94.3% 96.1% Solid leasing result in a challenging market Number of leasing transactions1 16 122 Average incentive 7.4% 7
Slide 13: Quarry at Greystanes
PORTFOLIO UPDATE Quarry at Greystanes 100% occupancy at completed developments DXS 50% / AIP 50% DXS 50% / AIP 50% future development DXS land future development Makita – owner occupier DEXUS Property Group September 2013 Quarterly Update Slide 13
Slide 14: Strategy
STRATEGY TITLE SLIDE HEADER 2013 Half Year DEXUS Property Group September 2013Results Presentation Quarterly Update — Slide 14 Slide 14
Slide 15: Core capabilities – Platform by DEXUS
STRATEGY Core capabilities – Platform by DEXUS Focus on delivering a positive experience for our tenants/customers through health and well-being campaigns, increased convenience and social networking activities — Digital screens, car park signage and lift wrap advertising — Nespresso coffee sample
Slide 16: Core capabilities – business systems
STRATEGY Core capabilities – business systems DXS systems and technology CBRE Pulse platform — Suite of fully-integrated applications comprises Pulse, Pulse Tech and DEXUS Response — Provides real-time operational and financial data 24 hours per day, 365 days per year periskope — DEXUS proprieta
Slide 17: Core capabilities – business systems
STRATEGY Core capabilities – business systems DEXUS Property Group September 2013 Quarterly Update Slide 17
Slide 18: Core capabilities – business systems
STRATEGY Core capabilities – business systems Will show dummy names DEXUS Property Group September 2013 Quarterly Update Slide 18
Slide 19: Core capabilities – business systems
STRATEGY Core capabilities – business systems DEXUS Property Group September 2013 Quarterly Update Slide 19
Slide 20: Core capabilities – business systems
STRATEGY Core capabilities – business systems DEXUS Property Group September 2013 Quarterly Update Slide 20
Slide 21: Market Outlook
MARKET TITLE OUTLOOK SLIDE HEADER 2013 Half Year DEXUS Property Group September 2013Results Presentation Quarterly Update — Slide 21 Slide 21
Slide 22: CBD markets are in a reasonable state of balance
MARKET OUTLOOK CBD markets are in a reasonable state of balance Market Sydney Melbourne Brisbane Perth Current 10.7 10.5 14.5 9.4 Vacancy (%) Past 25 year average 9.7 12.0 8.4 12.1 Past 25 year maximum 22.0 25.9 14.5 28.0 Current 30 23 28 11 Incentives (%) Past 25 year average 22 13 23 13 Past 25 ye
Slide 23: Leading indicators beginning to improve
MARKET OUTLOOK Leading indicators beginning to improve Employment indicators still sluggish but leading indicators are turning — Such as business confidence, business profits, consumer sentiment and growth in China ‘000 sqm Syd net demand (LHS) ANZ job ads, qtly change Business confidence 120 30%
Slide 24: Waves of industry growth point to sources of demand
MARKET OUTLOOK Waves of industry growth point to sources of demand Business services and technology industries usually benefit from cuts in the public and finance sectors as they outsource Parallels to the 1990s with a conservative government elected and strong business services growth Gov’t cha
Slide 25: Prime grade office space to benefit from flight to quality and migration
MARKET OUTLOOK Prime grade office space to benefit from flight to quality and migration Expect a pronounced uptake of prime grade office Net absorption by grade in Sydney CBD – past 3 years ‘000 sqm space over the next three years at the expense of 100 lower grade space 75 Tenant migration 50 We
Slide 26: Summary
SUMMARY TITLE SLIDE HEADER 2013 Half Year DEXUS Property Group September 2013Results Presentation Quarterly Update — Slide 26 Slide 26
Slide 27: Summary
SUMMARY A clear strategy with demonstrated execution capability Experienced management team achieving results in an uncertain market A strong third party funds management platform with strong growth potential Market guidance1 for FY14 reaffirmed — FFO per security: 8.15 cents — Distribution
Slide 28: Important Information
IMPORTANT INFORMATION This presentation is issued by DEXUS Funds Management Limited (DXFM) in its capacity as responsible entity of DEXUS Property Group (ASX: DXS). It is not an offer of securities for subscription or sale and is not financial product advice. Information in this presentation inc
DEXUS Property Group — Q1 FY2014 Earnings Presentation on 6ix