Annual meeting presentation

Asset Plus 2020 Annual Meeting
Assetplusnz.co.nz
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2020 Annual Meeting

Asset Plus 2020 Annual Meeting
Assetplusnz.co.nz
01
04
Manager’s
Presentation
0203
Agenda
Chairman’s
Address
Strategic
Update
Resolutions

Asset Plus 2020 Annual Meeting
Assetplusnz.co.nz
1. Chairman’s Address
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Asset Plus 2020 Annual Meeting
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Artist impression of the potential Graham Street Development

Asset Plus 2020 Annual Meeting
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2. Manager’s Presentation
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Asset Plus 2020 Annual Meeting
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No dividend was paid for the
fourth quarter due to the
impact of COVID-19
Unrealised loss on the fair value of
investment property of $19.1m or
11.9% of carrying value
Purchase of 35 Graham Street
for $58.0m in June 2019
Sale of Heinz Watties property
in Hastings for $29.1m in
December 2019
Purchase of land in Albany in
December 2019 and signing of a
conditional development
agreement with Auckland
Council for a 15 year lease term
2020 Update
1. AFFO stands for ‘Adjusted Funds From Operations’, and is non-GAAP financial information, calculated based on guidance issued by the Property Council of Australia. Asset Plus considers that AFFO is a useful measure for shareholders and management because it assists in assessing the Company’s underlying operating performance. This non-GAAP
financial information does not have a standardised meaning prescribed by GAAP and therefore may not be comparable to similar financial information prescribed by other entities. The calculation of AFFO has not been reviewed by Asset Plus’ auditor, GrantThornton.
Net rental income of $10.47m
up from $1.32m or 14% from
FY19
Total loss for the year net of tax of
$14.69m (FY19 profit of $3.80m)
Loan to value ratio is 34.3% (8.5%
as at 31 March 2019)
AFFO
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of $4.74m ($4.74m in FY19)

Asset Plus 2020 Annual Meeting
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Impact of COVID-19
•The COVID-19 pandemic has provided material future uncertainty in the real
estate market.
•As a result the investment property portfolio materially reduced in value by
$19.1m as at 31 March 2020.
•Rental abatements and relief applied to the April –June 2020 quarter has
impacted operating earnings by $0.59m ($0.42m after-tax), equivalent to
approximately 4% of the current annualised gross rental income.
•Majority of rental abatements are now agreed and all key tenants are back on full
rent. However regular monitoring of smaller retail operator performance
continues.
•This lost revenue will be partially offset by the reintroduction of building
depreciation in the next financial year.
•The full impact of COVID-19 will not be known for some time.
•While upfront rental abatement and relief has been granted, preservation of long-
term value is also a key strategy, which includes ensuring the continuing
operations of all retail tenants.
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Key Metrics
as at 31 March 2020
$142.1m
1
(Mar-19
2
: $122.8m)
98.3%
(Mar-19
2
: 96.7%)
3.16 years
(Mar-19
2
: 5.5)
71
(Mar-19
2
: 76)
4
(Mar-19
2
: 3)
34.3%
(Mar-19
2
: 8.5%)
$0.567
(Mar-19
2
: $0.694)
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1.Excludes $1.51m of WIP costs in relation to the development projects at 35 Graham St and Munroe Lane
2.In the year since 31 March 2019, 35 Graham Street was acquired in late June 2019 for $58m, the Munroe Lane property was acquired on 2 December 2019 for $7.25m and the Heinz Watties property was sold on 17 December 2019 for $29.1m.
Portfolio Value
WALE
Properties
LVR
Occupancy
Number of Tenants
NTA

Asset Plus 2020 Annual Meeting
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Portfolio Summary
as at 31 March 2020
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Eastgate, ChristchurchStoddard Rd, AucklandGraham Street, AucklandMunroe Lane, Auckland
Valuation ($m)
1
$46.95 (Mar-19: $54.5)$37.5 (Mar-19: $39.5)$50.1 (On acquisition: $58.0)$7.5 (On acquisition: $7.25)
WALE (years)4.53 (Mar-19: 5.07)4.00 (Mar-19: 4.02)1.24 (On acquisition: 2.0)-
Occupancy (%)95.3% (Mar-19: 93%)100% (Mar-19: 100%)100% (On acquisition: 100%)-
Net Rental Income ($m)*$3.66 (Mar-19: $3.63)$2.63 (Mar-19: $2.57)$3.95 (On acquisition: $3.95)-
Passing yield (%)7.80% (Mar-19: 7.30%)7.03% (Mar-19: 6.5%)7.93% (On acquisition: 6.9%)-
Comments•Bargain Chemist recently
secured as a new tenant on
a 6-year lease
•Ongoing discussions to
expand F&B offering
•Seismic work for The
Warehouse completed
•The property continues to
perform well and provide a steady
income stream
•100% of expiring leases were
renewed by existing tenants
during the year
•Acquired June 2019
•Auckland Council lease has
approximately 1 year to
run (expiring June 2021)
•Attractive holding income
•Acquired off-market
December 2019
•Large ~4,200m
2
corner site
with three road frontages
Largest tenant exposures•Countdown, The
Warehouse
•The Warehouse•Auckland Council-
*Based on the valuers net rental income assessment

Asset Plus 2020 Annual Meeting
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Eastgate
•Bargain Chemist committed to a 6 year lease at the Centre from 13 May 2020. Several tenancies have
been combined to meet the circa 800m² space requirements for the tenant.
•Seismicupgrade works for “The Warehouse” building were carried out and completed. All buildings at
Eastgate are now a minimum of 67% NBS.
•A number of lease expiries in 2020 have been allowed to holdover on a monthly basis to provide
flexibility with potential redevelopment options.
•Marketing for both internal and external areas of the Centre continues. Negotiations are well advanced
for a standalone fast-food restaurant adjacent to the KFC site. Internally, management continues to focus
on sourcing another internal anchor tenant in addition to Bargain Chemist.
•COVID-19 has had a significant impact on the March 2020 valuation. COVID-19 has brought an amount
of uncertainty to the retail market which has softened the capitalisation rate, and other valuation inputs.
•Moving Annual Turnover (MAT) was up January-March, however has been down slightly post lockdown.
Pedestrian counts have also been slightly subdued post lockdown.
20202019
Valuation ($m)46.9554.50
Net Rental Income ($m)3.663.63
Passing Initial Yield (%)7.80%7.30%
Cap Rate (%)8.38%8.13%
Net Market Rental ($m)4.094.46
WALT (years)4.535.07
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Asset Plus 2020 Annual Meeting
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Stoddard Road
•A total of 6 lease renewals were completed in 2020 (17% of the total rental income for the
Centre).
•WALT remained at 4.00 years in 2020 (4.02 years in 2019). Net contract income has
increased by $70,369 p.a. as a result of rent reviews.
•COVID-19 uncertainty has impacted retail market rents and softened capitalisation rates. As
a result, the valuation has decreased from $39.5m to $37.5m.
•The Centre is currently 100% occupied.
•The future leasing focus are the four renewals due in FY21, representing 16% of the total
rental income for the Centre.
20202019
Valuation ($m)37.539.5
Net Rental Income ($m)2.632.57
Passing Initial Yield (%)7.03%6.50%
Cap Rate (%)6.25%6.13%
Net Market Rental ($m)2.372.46
WALT (years)4.004.02
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Asset Plus 2020 Annual Meeting
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3. Strategic Update
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•The underwritten $100m capital raise launched in March 2020 was
withdrawn as a result of the impacts of COVID-19.
•The funding and shareholder approval condition in the Agreement to
Develop and Lease with Auckland Council has been extended from 31
July to 30 October 2020.
•The Board continues to consider all pathways and options to fulfil the
funding condition. The development continues to be progressed in
accordance with the agreed milestone schedule and is funded from
existing undrawn debt facilities.
•Bare land at Kamo, Whangareihas been acquired for $2.125m which
settles on 30 July 2020.
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Asset Plus 2020 Annual Meeting
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Increase the scale of the portfolio
The Graham Street and Munroe Lane developments (should they proceed) are
expected to increase the value of the portfolio, reducing the Management Expense
Ratio due to increased scale.
Reduce the share price to NTA gap
The Munroe Lane development (should it proceed), and Graham Street
development (if pursued) are expected to reduce the gap in the long term by (i)
enhancing the quality of the Asset Plus portfolio, (ii) executing on the ‘yield plus
growth’ strategy, (iii) increasing market capitalisation and liquidity, and (iv) realising
forecast development margins.
In the short-medium term targeting further positive leasing activity at Eastgate, pre-
leasing the balance of Munroe Lane, and securing tenant pre-commitment at
Graham Street.
Set a strong platform for sustainable growth moving
forward
Delivery of the Munroe Lane development (should it proceed) is expected to
significantly enhance the quality of the portfolio, and re-weight the portfolio to a
higher Auckland exposure, as well as increase office sector weighting of the
portfolio by income.
Provide an appropriate yield reflective of the value-
add, and total return approach adopted
The Munroe Lane development (should it proceed) is expected to provide attractive
risk-adjusted returns having regard to the high quality tenant covenant, and
extended pre-committed lease term over 63% of the building.
Strategic objectives
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02
03
04
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ObjectiveDelivering on the Objectives

Asset Plus 2020 Annual Meeting
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•Resource Consent for full scale redevelopment being lodged in the first week of
August and is expected to be received in late 2020.
•Marketing will commence in August 2020 led by Colliers
•Conditional 6 month lease over basement and ground floors agreed with Council
from June 2021 for $1m plus GST & OPEX
•The property provides options for reduced scale redevelopment / refurbishment
which will be pursued should sufficient tenant pre-commitment for the full scale
development not be secured.
•Early research indicates no fundamental changes in office space requirements as
a result of COVID-19, and increasing flexible work arrangements. (Colliers June
2020 research report indicates 75% of respondent intentions to retain or
increase their footprint moving forward).
35 Graham Street, Auckland CBD
Development update
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•Resource consent has been granted butthe
agreement remains conditional upon satisfaction of
the landlord funding condition and shareholder
approval.
•Condition date has been extended from the end of
July until 30 October 2020.
•Icon Construction appointed as ECI contractor.
•Construction is expected to commence in late 2020,
with a targeted completion date of December 2022.
•63% pre-leased on a 15 yearlease to Auckland
Council. Targeting September 2020 to commence
marketing the balance of unleased space (subject to
tenant options being exercised by Auckland Council).
Potential Munroe Lane
Development
Artist impression of the Munroe Lane Development
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Asset Plus 2020 Annual Meeting
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•Bare industrial land of 38,000m
2
located adjacent to SH1.
•Pipeline opportunity to re-zone or obtain Resource Consent for higher
and better commercial use.
•Development opportunity intended to be held as investment property
on completion.
•Settlement is 30 July 2020.
•Total consideration of $2.125m, or $56/m
2.
Kamo, Whangarei
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Asset Plus 2020 Annual Meeting
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Outlook
•The impact of COVID-19 further reinforces the adopted approach towards a diversified, value-add strategy that ultimately will increase
the portfolio size.
•The Manager continues to focus on working with retail tenants to navigate these uncertain times and preserve value in the longerterm
for shareholders.
•The proposed full scale Graham Street redevelopment is subject to obtaining sufficient tenant pre-commitment.
•Pathway to fulfilment of the funding and shareholder approval condition in the Munroe Lane Agreement to Develop and Lease is being
progressed and will be announced in due course.
•We remain committed to securing growth opportunities for Asset Plus to continue to execute the full transformation of the company.
•First quarter dividend payment announced today which reflects the impact of COVID-19 and the levels of rental abatement. The Board
expects to maintain dividends at this level, but will continue to review quarterly dividend payments with reference to activities and
earnings of the business.
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4. Resolutions
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Asset Plus 2020 Annual Meeting
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Election of
Director –Carol
Campbell
“That Carol Anne
Campbell be re-elected
as a Director of the
Company.”
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Resolution 1.

Asset Plus 2020 Annual Meeting
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Re-appointment
of Auditors
“That the Board be
authorised to fix the
auditors’ fees and
expenses from time to
time.”
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Resolution 2.

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