Argosy Investor Presentation

31 October 2018

MARKET RELEASE
BNZ / NAB First Look Investor Conference


A briefing is being held today for investors at the BNZ/NAB First Look Investor Conference in
Sydney, Australia.
A copy of the presentation has been provided to the NZX.

-END-

Enquiries
Peter Mence
Chief Executive Officer
Argosy Property Limited
Telephone: 09 304 3411
Email: pmence@argosy.co.nz

Dave Fraser
Chief Financial Officer
Argosy Property Limited
Telephone: 09 304 3469
Email: dfraser@argosy.co.nz

Stephen Freundlich
Head of Investor Relations
Argosy Property Limited
Telephone: 09 304 3426
Email: sfreundlich@argosy.co.nz

---

BNZ/NAB
First Look Investor
Conference
Sydney, 30-31
st
October
2018
Strength in diversity
Argosy Property Limited
www.argosy.co.nz

Agenda
2
1.Argosy at a Glance3
2.History4
3.Investment Strategy / Policy5
4.Financials12
5.Market Update17
6.Appendices20
Note: Due to rounding, numbers presented in this presentation may not add up exactly to the totals provided and percentages may not exactly reflect absolute figures. All $ are NZ$.

Argosy at a Glance
3
NUMBER OF BUILDINGS
36
BOOK VALUE OF ASSETS ($M)
$643.1
OCCUPANCY (BY INCOME)
100%
WALT (YEARS)
7.0
NUMBER OF BUILDINGS
16
BOOK VALUE OF ASSETS ($M)
$578.9
OCCUPANCY (BY INCOME)
96.3%
WALT (YEARS)
4.8
NUMBER OF BUILDINGS
8
BOOK VALUE OF ASSETS ($M)
$302.7
OCCUPANCY (BY INCOME)
98.4%
WALT (YEARS)
6.0
Data as at 31 July 2018
NUMBER OF BUILDINGS
60
BOOK VALUE OF ASSETS ($B)
$1.525
OCCUPANCY (BY INCOME)
98.3%
WALT (YEARS)
6.0

History
4
1.2002 => Listed in Dec-02 as Paramount
Property Trust with external management
structure.
2.2003 => Acquires $280m unlisted MFL
property portfolio. Fund Manager ING
acquires management company and
rebrands to ING Property Trust (ING.NZ).
3.2005 => Acquired UrbusProperties Group for
$410m with a portfolio of 50 properties.
4.2010 => ANZ National Bank takeover of ING
NZ sees the trust rebranded Argosy Property
Trust (ARG.NZ).
5.2011 => Internalised.
6.2012 => Converted from Trust structure to
Corporate structure.
7.2012 => Dec-12 a $100m equity raising
($80m private placement, $20m share
purchase plan) to support acquisition of 15
Stout Street ($79.8m) & NZ Post House
($100m).
8.2013 => Jul-13 a 1:7 pro rata renounceable
rights issue to raise $86.9m to support
acquisition of 80 FavonaRd ($74m) and 101
Carlton Gore Rd ($22m).
1
2
3
4
5
6
7
8
GFC
Source: IRESS, annual reports

Investment Strategy/Policy
5

Investment Strategy/Policy
6
Investment Strategy
Investment Policy
Framework
Consists primarily of Core and Value Add properties.
Core properties to be between 75-90% of the portfolio by value.
Value add properties to be between 10-15% of the portfolio by value.
Target sector bands (Industrial 40-50%, Office 30-40%, Retail 15-25%).
Preference for acquisitions > $10m.
Undertake developments with partners/tenants where it makes strategic sense.
Enter JV’s only where appropriate.
No international, leasehold properties.

36%
36%
28%
42%
38%
20%
Portfolio by Sector
IndustrialOfficeRetail
2018
2014
85%
10%
5%
86%
7%
7%
Portfolio by Mix
CoreValue addNon Core
2018
2014
70%
22%
8%
71%
24%
5%
Portfolio by Region
AucklandWellingtonRegional
2018
2014
Portfolio Transformation
7
Improved portfolio quality.
Asset allocation bands adjusted for the environment.
Stronger business –4yr GDI growth of 4.6% p.a.
Growing exposure to green assets / sustainability focus (~13% of portfolio by value).
Less retail, more
industrial..
Value add being
developed out..
Regional exposure
reducing..
Data as at 31 March financial year end.

Portfolio History
8
Acquisitions and developments key drivers of portfolio growth in recent years
Industrial 36%
Office 36%
Retail 28%
Industrial 42%
Office 38%
Retail 20%

Auckland & Wellington Focus
9
A diversified portfolio of high quality assets and tenants
Value add opportunities with existing and potential new
tenants
Geographic distribution of portfolio
Data as at 31 July 2018

Development Programme
10
Completion: 20142017/182018
NLA / WALT: 21,000sqm / 7.9yrs6,000sqm / 7.2yrs10,600sqm / 9.4yrs
Green rating: 5 Green Star Built Targeting 5 Star Targeting 4 Star
NABERSNZ rating: 5 StarTargeting 5 Star n/a
Current value:$107.1m$42.3m$28.9m
HighgateBusiness Park,
Auckland
82 Wyndham Street,
Auckland
15-21 Stout Street,
Wellington

Lease Maturity
11
Lease maturity profile relatively stable over the medium term, no material single tenant exposure
Data as at 31 March 2018

FINANCIALS
12
Change image

Argosy 5-yr History
13
Our focus is delivering improved portfolio quality and is reflected in our strong portfolio metrics.
0.00
1.00
2.00
3.00
4.00
5.00
6.00
7.00
FY14FY15FY16FY17FY18
WALT (years)
0.0%
20.0%
40.0%
60.0%
80.0%
100.0%
FY14FY15FY16FY17FY18
Occupancy
$0.85
$0.90
$0.95
$1.00
$1.05
$1.10
$1.15
FY14FY15FY16FY17FY18
Net Tangible Assets
0.00%
0.50%
1.00%
1.50%
2.00%
2.50%
3.00%
3.50%
FY14FY15FY16FY17FY18
Rent Rev iews -annualised increase

0.0%
5.0%
10.0%
15.0%
20.0%
25.0%
30.0%
35.0%
40.0%
45.0%
FY14FY15FY16FY17FY18
Debt-to-total-assets
$50
$60
$70
$80
$90
$100
$110
FY14FY15FY16FY17FY18
Net Property Income
5.6
5.8
6.0
6.2
6.4
6.6
6.8
FY14FY15FY16FY17FY18
Net Distributable Income (cps)
0.0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
4.0
FY14FY15FY16FY17FY18
Interest Cov er Ratio (times)
Argosy 5-yr history
14
Our portfolio transformation has delivered stronger earnings allowing steady dividend growth to
shareholders.

Gearing, Funding & Interest Rate
Management
15
Further divestment of non Core assets will see the portfolio repositioned to the lower end of its
retail band (15-25%) and higher end of industrial band (40-50%) over next 12-18 months.
Target policy gearing range of between 30-40%.
Argosy maintains strong relationships with its banking partners ANZ Bank New Zealand Limited,
Bank of New Zealand and The Hongkong and Shanghai Banking Corporation Limited, and
remains well within its banking covenants.
Argosy restructured its syndicated bank facility in May 2017, February 2018 and October 2018.
Target
range
3.1years
1
Weighted avg. bank facility term
3.3 times
1
Interest Cover Ratio
1. Data as at 31 March 2018. Chart data as at 31 March financial year end.

Dividends
16
FY19 dividend guidance of 6.25 cents per share, an increase of ~1.0% on the previous year.
The FY19 dividend reflects the Boards wish for shareholders to share in the continued strong results
whilst allowing Argosy to maintain its momentum towards an AFFO based dividend policy by 2021.
6.25c
FY19 dividend guidance

Market Update
17
Change image

NZ Market Update
18
Office
Flexible working environments driving disconnect between employment growth and net absorption. Structural
trend is occupiers relocating taking ~10% less space per person than they had previously.
Rental growth impacted by new supply and there has been an increase in incentives to reflect this.
The 2016 earthquake created structural change in the Wellington market, strong demand, low vacancy and
stock levels. There is a shortage of large floor plate/high quality stock with upward rental growth pressure as a
result. Prime vacancy is minimal given pending new supply. Market vacancy is mostly C grade stock.
Industrial
Steady economic growth driving occupier demand. Offshore capital flows driving yields/cap rates lower.
Continued low supply forecast with 1.4% new supply expected per annum between 2018-2022.
Land values are at historic highs.
New rental benchmarks being set with ~$130-140m2 for prime warehouse.
Vacancy at historic lows for both prime and secondary (< 2%).
Retail
Generally a more negative retail spending outlook. Waning migration, increasing fuel prices and flat housing
prices are providing headwinds.
However, some offset from rising minimum wage and a booming tourism sector.
Approximately 200,000m2 of retail space to be added by 2022.
Continued increase in online retailing.
Large format retail expected to see biggest rental growth.

Outlook
19
New Zealand economic outlook is still positive with economic growth forecast. Global volatility
heightened, some flow through to local market.
Interest rates expected to remain supportive over the next few years.
Rental growth to continue.
Green assets will continue to see increase in demand from tenants.
Vendor conditions remain favourable. Continued focus for Argosy on divestment of non Core
assets to reinvest elsewhere or to strengthen the balance sheet.
Acquisition environment challenging.
We will continue to focus on value add opportunities with a green overlay.

Appendices
20

Board of Directors
21
Extensive management and
corporate governance
experience in New Zealand
Previous directorships with
Fonterra, Auckland Airport, Fisher
& Paykel Healthcare
Current directorships include:
Greymouth Petroleum Limited
Maui Capital Aqua Fund Limited
Maui Capital Indigo Fund
Limited
Extensive management
experience in New Zealand
including 20 years with Merrill
Lynch (Managing Director)
Trustee of Melanesian Mission
Trust Board
Current directorships include:
Burger Fuel Worldwide Limited,
Chairman
Generate Investment
Management Limited, Chairman
Over 20 years of management
experience across UK, Australia
and New Zealand
Current directorships include:
Milford Asset Management
Limited Chairman
Chorus Limited
Genesis Energy Limited
Z Energy Limited
Mike Smith -Chairman
Peter Brook -Director
Mark Cross -Director

Board of Directors
22
More than 25 years experience
across corporate New Zealand.
Chairman of the NZ Sports Hall of
Fame, Scott Technology Ltd and
UDC Finance Ltd.
Past President of NZ Institute of
Directors.
Current directorships include:
Scenic Circle Hotels Ltd
Dunedin International Airport Ltd
Ngai TahuTourism Ltd
More than 35 years as a property
lawyer, 29 of these as a partner
at Russell McVeagh
Trustee of the Spirit of Adventure
Trust and other charitable trusts
Holds a number of private
company directorships
Over 25 years commercial real
estate and asset management
experience
Current directorships include:
Vital Healthcare Property Trust
Trust Investment Management
Limited
Holmes Group Limited
Andrew Evans -Director
Jeff Morrison -Director
Stuart McLaughlan-Director

Management
23
An engineer by background, Peter has 35 years
of experience in the property industry working
with Progressive Enterprises, Challenge
Properties, Richard Ellis and Green and McCahill.
Peter has been with Argosy since 1994 and was
appointed Chief Executive in 2009.
He is a Fellow of the Property Institute and is a
past lecturer in Advanced Property
Management at The University of Auckland and
has just retired as President of the Property
Council of New Zealand.
Has over 28 years in senior financial and general
management roles both in New Zealand and
overseas, including a period in Japan as a senior
vice president with the Jupiter Group.
Joining in 2011 he was responsible for Argosy’s
internalisation and corporatisation transformation.
He now oversees the financial and corporate
activities of Argosy.
Dave is a qualified Chartered Accountant, and
holds a Bachelor of Commerce and MBA from
The University of Auckland.
Dave Fraser –CFO
Peter Mence -CEO

Portfolio Metrics
24
Data as at 31 July 2018
The strength of our diversified portfolio is in the breadth and depth of our tenant base and sectors
they represent.

Argosy at a glance
25
$1.52b
99%
Occupancy (by rental)
Debt to total assets
5.6yr
12.5%
WALT
10yr total return p.a
1
5yr NTA growth
60
No. of Properties
Investment Portfolio
$0.91b
Market capitalisation
19.1%
+170
Property partners
36.6%
Data as at 31 July 2018. * average = measured as at 31 March financial year end. 1. Total shareholder return on annualised basis. Return as at 30 September 2018.
5yr average*
5yr average*
5yr average*

Disclaimer
26

Disclaimer
27
This presentation has been prepared by Argosy Property Limited. The details in this presentation
provide general information only. It is not intended as investment or financial advice and must
not be relied upon as such. You should obtain independent professional advice prior to making
any decision relating to your investment or financial needs. This presentation is not an offer or
invitation for subscription or purchase of securities or other financial products. Past performance
is no indication of future performance.
All values are expressed in New Zealand currency unless otherwise stated.
30 October 2018