Hyprop Investments Limited · JSE:HYP
Hyprop Investments — Investor Presentation (December 2019)
37 slides from Hyprop Investments's investor presentation, Dec 2, 2019
Slide 1: Pre-close 2 December 2019
INVESTMENTS LIMITED ARK CORN Pre-close 2 December 2019
Slide 2: Our Vision & Values
OUR VISION & VALUES To be a leading South African based REIT through managing and developing tangible and intangible assets Reposition malls, partner Strengthen with out tenants the entertainment and manage the and restaurant Core values which portfolio on a offering, together are integral holistic
Slide 3: Agenda
AGENDA PRIORITIES SOUTH AFRICA R EASTERN EUROPE € SUB-SAHARAN AFRICA (Excluding SA) $ BORROWINGS & LTV PRIORITIES & GUIDANCE Canal Walk, Century City, Cape Town 3
Slide 4: Priorities - Dec 2019
PRIORITIES - DEC 2019 GROUP Implement revised strategy Cash-backed distributions Optimise capital structure Long-term investment decisions SOUTH AFRICA EASTERN EUROPE SUB-SAHARAN AFRICA NON-TANGIBLE ASSETS (Excluding SA) Assess and reposition malls Retain dominance and Implement exit strategy Formal
Slide 5: South Africa
GAUTENG REGION SOUTH AFRICA Assess and reposition malls ▪ Full market study on malls ▪ Right-sizing of tenants – Relocating and upgrading - Checkers, Fresh X ▪ Rooftop gardens Increase trading densities ▪ Focus on granular food & leisure mix WESTERN CAPE REGION ▪ First Lego and flagship iStore opene
Slide 6: Operations - South Africa
OPERATIONS South Africa Trading density - R/m² Rent ratio - portfolio 5 000 15% 4 000 3.8% 2.6% 0.6% 1.2% 10% 3 000 2 941 2 958 2 930 2 966 9.1% 9.4% 9.2% 9.5% 2 000 5% 1 000 0% Jun Jun Oct Oct Jun Jun Oct Oct 2018 2019 2018 2019 2018 2019 2018 2019 (Rolling 12 months) (Rolling 12 months) Average mo
Slide 7: Top 10 groups by GLA
TOP 10 GROUPS BY GLA Pick 'n Pay 6.1% Edgars 5.9% *% of total Woolworths 7.5% *% of total Gross Game 4.6% Tenant GLA Income Woolworths 7.5% 2.9% Checkers 2.6% Nu Metro 2.5% Pick 'n Pay 6.1% 1.7% Builders Warehouse 1.9% Edgars 5.9% 4.4% Dis-Chem 1.9% Game 4.6% 2.4% H & M 1.8% Truworths 1.6% Checkers
Slide 8: Current Projects
CURRENT PROJECTS Mall Project Completion date Budget Yield Status Woodlands • Phase-2: Restrooms Boulevard, April 2020 R8.4 m n/a In process Two remaining blocks Pretoria The Glen, • New 4 100m² ‘Fresh-X’ October 2019 R 54.2 m 9.8% Completed Johannesburg Checkers in Edcon space Canal Walk, • Phased
Slide 9: Future Projects
FUTURE PROJECTS Mall Project Woodlands Boulevard, ▪ Right size tenants and secure new anchor Pretoria – in discussion with various tenants ▪ Edgars replacement with a new anchor to the Mall Rosebank Mall, - awaiting final board approval Johannesburg ▪ Capex R55m ▪ Trade by 1 Oct 2020 ▪ Install solar
Slide 10: Eastern Europe
EASTERN EUROPE Retain dominance & asset management ▪ Apply for further development rights Croatia ▪ Launch Hyper-level in Sofia ▪ Right-size tenants and acquire further land Serbia at Skopje City Mall Bulgaria ▪ Restructure in-country debt Montenegro Leverage SA expertise Macedonia ▪ Detail faciliti
Slide 11: Operations - Eastern Europe
OPERATIONS Eastern Europe Trading density per month - € Rent ratio - portfolio 400 12.0% 3.4% 11.5% 0.2% 300 3.7% 11.0% 2.4% 200 245 254 247 255 10.9% 10.9% 10.9% 10.5% 10.6% 100 10.0% 9.5% Jun Jun Jun Oct Oct Oct Jun Jun Jun Oct Oct Oct 2018 2019 2018 2019 2018 2019 2018 2019 (Rolling 12 months) (R
Slide 12: Top Tenant Groups by GLA
TOP 10 TENANT GROUPS BY GLA Inditex 9.8% Interspar 5.6% % of Total * % of Total Tenant GLA Income Peek & Cloppenburg 4.4% Inditex 9.8% 7.3% Cineplexx 4.1% Interspar 5.6% 3.2% H&M 3.8% Peek & Cloppenburg 4.4% 2.4% C&A 2.6% Cineplexx 4.1% 1.4% New Yorker 2.0% H&M 3.8% 1.4% Ramstore 1.9% Müller Drogeri
Slide 13: Current Projects
CURRENT PROJECTS Mall Project Completion date Budget Yield Status Delta City, Parking upgrade: Podgorica, • Paid parking implemented August 2019 €0.96 m 15% Complete Montenegro • Existing parking deck refurbished Repositioning: Skopje City Mall, • Right-sizing tenants Skopje, • Improve vertical flow
Slide 14: Future Projects
FUTURE PROJECTS Mall Project • Upgrade and refurbishment of the food court The Mall, Sofia, • New potential tenants Bulgaria • Capex EUR1.6m • Commence March 2020 • Mall extension of 7 500m² Delta City, Podgorica, • Linking with the adjoining mall Montenegro – subject to zoning approval • Extend the
Slide 15: Sub-Saharan Africa (Excluding SA)
SUB-SAHARAN AFRICA (Excluding SA) Implement exit strategy Take control of asset management Preserve value Ghana Nigeria 15
Slide 16: Disposals
DISPOSALS ▪ Completed ▪ Achimota (Ghana) and Manda Hill (Zambia) sold ▪ Proceeds used to settle USD debt ▪ Phase two ▪ Ikeja City Mall, Nigeria ▪ Various interested parties Accra Mall, Accra, Ghana ▪ Target completion date 31 Dec 2020 ▪ Phase three ▪ Accra Mall, West Hills Mall and Kumasi City Mall
Slide 17: Operations - Sub-Saharan Africa
OPERATIONS Sub-Saharan Africa Trading density - $ / m² Trading density – Local Currency / m² 200 2.7% 1 000 6.6% 199 6.0% 9.0% 190 197 191 950 965 959 180 187 900 170 906 850 880 160 150 800 Jun Jun Sep Sep Jun Jun Sep Sep 2018 2019 2018 2019 2018 2019 2018 2019 (Rolling 12 months) * Excluding Ikeja
Slide 18: Interventions
INTERVENTIONS Completed ▪ Clear lines of responsibility ▪ Improve communication ▪ Internalise asset management function ▪ Retain and hire key staff Ongoing ▪ Restructure in-country debt to reduce funding cost ▪ Restructure arrangements with in-country partners ▪ New funding arrangements between shar
Slide 19: Borrowings and LTV
BORROWINGS AND LTV Rosebank Mall, Rosebank, Johannesburg 19
Slide 20: Debt Maturity Profile
DEBT MATURITY PROFILE SOUTH AFRICA Oct 2019 Jun 2019 (ZAR million) 1200 * 950 960 Property value (Rbn) 28.5bn 28.5bn 1000 -R58m 800 LTV 14.4% 15.6% 452 600 500 Weighted average cost of debt (incl hedges) 9.3% 9.3% 425 400 317 348 400 250 Weighted average loan tenor 2.7 2.8 200 Proportion of debt hed
Slide 21: Reducing LTV and Sensitivity
REDUCING LTV AND SENSITIVITY R185m* R555m** See-through LTV ratio 35.2% 35.0% 35.0% R2 864m 33.7% (1.3%) See-through Change in property values LTV ratio 35.2% (5%) (10%) (15%) (20%) (20%) 33.7% 35.5% 37.6% 40.0% R1 881m (10%) 35.4% 37.4% 39.6% 42.1% 28.2% Rand (5.5%) (stronger)/ 0% 37.0% 39.1% 41.4%
Slide 22: Priorities and Guidance
PRIORITIES AND GUIDANCE Clearwater Mall, Strubens Valley, Roodepoort 22
Slide 23: Priorities and Guidance
PRIORITIES AND GUIDANCE SOUTH EASTERN SUB-SAHARAN NON-TANGIBLE GROUP AFRICA EUROPE AFRICA ASSETS Retain dominance Take control of asset Formalise and implement Reduce the LTV Assess and reposition malls • Extensions management retail.nxt Restore investment grade • New brands • Asset management credi
Slide 24: Questions & Answers
QUESTIONS & ANSWERS Woodlands, Pretorius Park, Pretoria East 24
Slide 25: Appendices
APPENDICES The Glen, Oakdene, Johannesburg South 25
Slide 26: Company Structure - South African Portfolio
COMPANY STRUCTURE - SOUTH AFRICAN PORTFOLIO Western Cape Gauteng Somerset Hyde Park Rosebank Clearwater Woodlands Mall Corner Mall 100% owned Atterbury Value Offices SOUTH CapeGate Mart Cradock Heights AFRICA Canal Walk The Glen Co-owned (80%) (75,16%) 26
Slide 27: South African Properties
SOUTH AFRICAN PROPERTIES Canal Walk & Portfolio summary Canal Walk Offices Clearwater The Glen Woodlands CapeGate % Ownership 80% 100% 75.15% 100% 100% GLA 158 697 87 033 80 300 71 819 63 831 Vacancy levels 0.8% 0.3% 2.5% 2.2% 0.2% Avg foot count per m² / month 11.2 9.4 12.0 9.4 13.6 27
Slide 28: South African Properties
SOUTH AFRICAN PROPERTIES Somerset Rosebank Hyde Park Corner Atterbury Cradock Rosebank Mall Portfolio summary Mall Mall & Offices Value Mart Heights Offices % Ownership 100% 100% 100% 100% 100% 100% GLA 68 989 65 831 38 716 48 642 4 468 18 249 Vacancy levels 0% 2.3% 8.7% 0.5% 9.0% 2.5% Avg foot coun
Slide 29: Company Structure - Eastern Europe Portfolio
COMPANY STRUCTURE - EASTERN EUROPE PORTFOLIO 60% Hystead (United Kingdom) owned 100% 100% 100% 100% The Mall Delta City Delta City Skopje Sofia EASTERN Belgrade Podgorica City Mall (Bulgaria) (Serbia) (Montenegro) (Macedonia) EUROPE (EU) 90% 90% City Center City Center One - East, One - West, Zagreb
Slide 30: Eastern Europe Properties
EASTERN EUROPE PROPERTIES Delta City Delta City Skopje The Mall City Center City Center Belgrade Podgorica City Mall Sofia One East One West Portfolio summary Serbia Montenegro Macedonia Bulgaria Zagreb, Croatia Zagreb, Croatia % Ownership 60% 60% 60% 60% 54% 54% GLA 29 862 23 493 36 373 61 914 48 5
Slide 31: Hystead Capital Structure
HYSTEAD CAPITAL STRUCTURE 100% 10% 12% 11% 160 67% 40% 270 241 60% Debt guaranteed directly PDI Jun 2019 HYPROP Jun 2019 PDI Jun 2019 HYPROP Jun 2019 €m €m % % Debt guaranteed directly % 40 361 10 90 Adjusted for: 91 (91) 23 (23) PDI - back to back security - UK Listed shares 47 (47) 12 (12) Guarant
Slide 32: Company Structure - Sub-Saharan Africa Portfolio
COMPANY STRUCTURE – SUB-SAHARAN AFRICA PORTFOLIO 100% Hyprop Investments Mauritius owned 37.5% SUB- AttAfrica SAHARAN (Mauritius) AFRICA (excluding SA) 47% 58.5% 97.5% 75% Accra West Hills Kumasi Ikeja Mall Mall City Mall City Mall (Ghana) (Ghana) (Ghana) (Nigeria) 32
Slide 33: Sub-Saharan Africa Properties
SUB-SAHARAN AFRICA PROPERTIES Portfolio summary Accra Mall West Hills Mall Kumasi City Mall Ikeja City Mall % Ownership 17.6% 21.94% 36.6% 75.0% GLA m² 21 311 28 272 18 604 22 223 Vacancy levels 4.3% 13.2% 10.0% 2.3% Avg foot count per m² / month 28.1 16.5 30.8 28.3 *As at end Sep 2019 33
Slide 34: Total Debt Maturity Profile (ZAR million)
TOTAL DEBT MATURITY PROFILE (ZAR million) 3 500 2 950 3 000 2 637 2 500 1 929 2 000 1 500 1 055 * 950 960 1 000 736 783 452 500 500 400 348 251 317 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2019 2020 2021 2022 2023 2024 2025 * New debt 34
Slide 35: Reducing LTV and Sensitivity
REDUCING LTV AND SENSITIVITY R185m* 44.0% R555m** 44.0% 44% R2 864m Fully consolidated LTV ratio 44.0% (0.9%) 42% Fully Change in property values consolidated 40% R1 881m 44.0% (5%) (10%) (15%) (20%) LTV ratio 39.3% (3.8%) (20%) 42.1% 44.2% 46.6% 49.3% 38% (10%) 44.2% 46.4% 48.9% 51.7% Rand 36% (str
Slide 36: Disclaimer - Forward-looking Statements
DISCLAIMER Forward-looking Statements ▪ This document contains forward-looking statements that, unless otherwise indicated, reflect the group’s expectations as at 2 December 2019 ▪ Actual results may differ materially from the group’s expectations if known and unknown risks or uncertainties affect i
Slide 37: Contact Details Investor Relations
CONTACT DETAILS INVESTOR RELATIONS Michèle Mackey Mobile: +27 82 497 9827 Tel: +27 10 003 0661 E-mail: [email protected] City Center One West, Zagreb, Croatia 37
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