2014 full-year earnings

Transcription

1 2014 full-year earnings Paris, February 20, 2015 Bernard Michel Chairman Philippe Depoux CEO Nicolas Dutreuil CFO

2 CLIQUEZ POUR MODIFIER LE STYLE DU TITRE Gecina in a nutshell

3 Gecina in a nutshell: a French leader on offices Key facts & figures Ranking by office GAV in France as of December 2014 (in bn ) Total portfolio 10.3bn The #1 office REIT in France with a 6.4bn portfolio 40% of the offices portfolio in the Paris CBD 96.4% occupation rate at December 31, 2014, very close to theoretical maximum level Positioned on the #1 office market in Europe: c.12m inhabitants in the Paris region (vs. c.8m in Greater London), large share of executive staff, region accounting for 30% of French GDP (vs. 21% for Greater London) LTV still moderate at 36,7% (end 2014) Standard & Poor s BBB+/ outlook Stable, Moody s Baa1/ outlook Stable Portfolio breakdown by GAV (end-2014) 10.3bn Share price performance since January 2013 (rebased) Other offices 8% Traditional residential 25% 50% 40% Offices 63% Western Crescent 21% Paris 34% Student accomodation 2% Healthcare 11% 30% 20% 10% 0% -10% 31-déc. 31-janv. 28-févr. 31-mars 30-avr. 31-mai 30-juin 31-juil. 31-août 30-sept. 31-oct. 30-nov. 31-déc. 31-janv. 28-févr. 31-mars 30-avr. 31-mai 30-juin 31-juil. 31-août 30-sept. 31-oct. 30-nov. 31-déc. 31-janv. GECINA SIIC France EPRA EUROP 3

4 An emblematic portfolio Le Building 37, rue du Louvre Paris Horizons 30, cours de l île Seguin Boulogne-Billancourt Place Vendôme 10-12, place Vendôme Paris 101 Champs Elysées 101, avenue des Champs Elysées Paris

5 Contents 1/ market perspectives 1.1/ Paris office market remained challenging in / but Gecina achieved a solid performance 1.3/ Improved outlook for 2015? 2/ Gecina s main achievements in / Key figures and guidance 2.2/ Asset rotation 2.3/ Lease management 2.4/ Diversification portfolios 2.5/ CSR process 2.6/ Financial achievements 3/ FY 2014 earnings 3.1/ Rental income 3.2/ Recurrent net cash flow 3.3/ Appraisal values and NNNAV 4/ Strategic update: harnessing value creation potential 5/ Appendices 4.1/ One vocation: leading the Paris Office market 4.2/ One priority: harnessing value creation potential 4.3/ Stabilized shareholding structure supporting our strategic views 4.4/ Operational reorganization in line with these ambitions 5

6 CLIQUEZ POUR MODIFIER LE STYLE DU TITRE market perspectives

7 Paris office market in 2014 remained challenging Still challenging in 2014, but certain signs suggesting confidence for the future Investments: back to the cyclical highs while take-up returned to normalized levels 35,0 30,0 25,0 Bn Other regions Paris region +40.6% in Paris region +30.4% in other regions Average ,0 15, , , , Source: BNP Paribas Real Estate Prime rents decreased slightly 0 Paris Paris South Paris North La Défense Western Center West (incl. CBD) East Crescent Inner Rim Outer Rim Source: CBRE while vacancy rates increased marginally from 7% to 7.2% 14 in % Max Average ( ) 2014 Source: Cushman & Wakefield 4 2 Min 0 Paris Center Paris south Paris North La Défense Western west East Crescent Inner Rim Outer Rim Source: CBRE 7

8 but Gecina achieved a solid performance Gecina achieved a solid performance in 2014 despite a challenging rental market environment Vacancy rates reached their lowest levels since ,0% 9,0% 8,0% 7,0% 7.2% 6,0% 5,0% 4.7% 4,0% 3,0% 2,0% Gecina's office portfolio 1,0% Paris Region 0,0% Source: CBRE, Gecina and a significant reduction in the cost of debt positive organic rental growth on offices Despite weak indexation and limited negative reversionary potential 6,0% +3.4% 4,0% +0.7% 2,0% -2.8% -3.1% +0.4% 0,0% -2,0% -4,0% -6,0% Index Vacancy Reletting & renegotiations Other Source: Gecina drove a solid performance in recurrent net earnings 44% 4,2% in m % 40% 38% 36% 34% -40bp in %* 4,0% 3,8% 3,6% 3,4% Underlying growth +5.9%* % as published 32% 3,2% 30% Source: Gecina LTV Average cost of debt Cost of debt including undrawn credit line : 3.6%. Cost of drawn debt : 3.0% 3,0% * Excluding the impacts of non-strategic disposals (Beaugrenelle in 2014, hotels in 2013), assuming a 40% LTV. 8

9 Paris office market in 2015: improved outlook? Some silver linings for 2015 Historically high spread over bond yields while new/refurbished supply is becoming scarce 7% Volume of definite supply > 10,000 sq.m Average volume of operations above 10,000 sq.m operations in the last 5 years 6% Average volume of operations above 5,000 sq.m operations in the last 5 years 5% 4% 3% 4.0% 4.0% 305bp 6.05% 3.75% 535bp 1,101, ,723 sq.m 648,053 sq.m 2% 1% 0% Prime Paris CBD real estate yields French 10-year gvt bond Gecina - Offices net yield Sources: Bloomberg, CBRE, Insee, Gecina 0.7% 443, , Source: Cushman & Wakefield Paris region office markets expected to at worst flatten out in 2015 but moderate macro recovery could enhance the picture Under the following cautious assumptions for 2015 GDP growth: +0.8%/ Inflation: +0.5%/ French sovereign bond yield flattening out at 0.7% IEIF Institute expects the Paris office market to adjust as following: Investments: roughly in line with 2014 levels Take-up to recover Absorption capacity to remain stable Vacancy rates to increase by 30bp Market rents to contract slightly (-1%) If assuming positive macro inputs Decreasing oil prices Cheaper Euro exchange rates Lower interest rates Potential stimulus from the ECB QE plan to increase GDP prospects and tenants margins by H Paris region office market expected to deliver a positive surprise Any moderate increase in GDP growth forecasts would have a significant impact on market equilibrium According to the IEIF Institute, higher assumptions for GDP growth by 2017 (+0.5pts higher) could drive rental levels up by at least +2% already on average for the Paris Region in

10 CLIQUEZ POUR MODIFIER LE STYLE DU TITRE Main achievements in 2014

11 Key figures for 2014 and guidance In million euros FY 2013 FY 2014 FY 2015 guidance Gross rentals EBITDA EBITDA margin 81.6% 81.9% Net financial expenses Recurrent net income - Group share Recurrent net income (yoy growth) +1.8% Recurrent net income (underlying growth) +5.9%(*) As a minimum flat given 800m disposals, or over +2% excluding Beaugrenelle impacts Could be increased with additional investments expected this year LTV 38.7% 36.7% < 40% Average cost of debt (all in) 4.0% 3.6% Further reduction in average cost of debt by -40bp Average cost of drawn debt 3.5% 3.0% Disposals (Group share) 800m (> 40m already achieved) Investments m already secured*** NNNAV (EPRA) Dividend 4.6 per share 4.65 per share (**) Key ESG figures % of office buildings with HQE Operations certification Energy consumption trend for office assets in kwhpe/sq.m/year(primary energy at constant climate) FY 2016 guidance 44% 63% 80% * Restated for the impacts of Beaugrenelle and the hotel portfolio, assuming an LTV of 40% on these disposals ** Submitted at the AGM in April 2015 *** Acquisition of City 2 in Boulogne-Billancourt for 188m, to be delivered end 2015, with a new lease starting by April

12 Main achievements in 2014: asset rotation Net seller in 2014 Change in asset rotation (Group share) Main acquisition ,0% 7.3% 4.1% 7.9% 11.8% 7.8% 5.9% ,0% Acquisitions: 49% ( 135m) Ongoing projects: 34% ( 95m) ,0% Capex: 17% ( 47m) ,0% Residential: 13% ( 80m) Offices (primarily Beaugrenelle): 86% ( 527m) ,0% Healthcare: 1% ( 6m) Investments Disposals Asset rotation as % of GAV Main disposal achievements -200,0% Acquisition of Le France in June Acquisition price: 133m (including duties) % net yield BMW building in Madrid (sold in January 2015) - Sales price 41m - 18% above last appraisal value Paris Sebastopol (Offices) - Sales price 11m - 45% above last appraisal value Beaugrenelle: sold in April Sales price 688m (excluding duties) - Total capital gain over construction costs: +41% - 4.1% exit yield Exclusively unit-based residential sales (vacant & occupied) - Sales price 96m (o.w 16m committed) - 33% premium vs block appraisal values 12

13 Main achievements in 2014: asset rotation Disposals achieved in 2014: 613m By asset type Premium vs last appraisal values & net exit yields Healthcare 1% Residential 13% Offices 2% Average exit yield 4.1% 33% 41%* Exit yield 3.0% Exit yield 4.2% Exit yield 7.3% Beaugrenelle 84% 1% 7% Residential (unit) Offices/ Beaugrenelle Healthcare * Assuming the total capital gains over construction costs for Beaugrenelle Investments achieved in 2014: 277m By asset type By type of project Offices Student accommodation Healthcare 17% Acquisitions Capex Completed projects 30% Average yield 6.45% 18% Ongoing projects 49% 65% 4% 17% 13

14 Main achievements in 2014: asset rotation Completions in 2014 and new projects secured Assets delivered New projects secured (excl. city 2, secured in feb.2015) Saint-Denis Pleyel (student accommodation) - Total investment: 18m - Yield on cost: 6.7% - Total area 4,518 sq.m, 198 beds - Delivered in July 2014 Paris Lecourbe (student accommodation) - Total investment: 17m - Yield on cost > 5.2% - Total area 2,674 sq.m, 132 beds - Delivered in August 2014 La Grande Halle in Lyon - Gecina s stake: 60% - Tenant: fully pre-let to EDF, 9-year firm lease - Total investment: 55m - Yield on cost: 7.9% - Total area: around 20,000 sq.m - Expected delivery Q2-17 Puteaux Valmy (student accommodation) - Total investment: 21m - Yield on cost: 6.1% - Total area 3,937sq.m, 188 beds - Expected delivery:

15 Main achievements in 2014: asset rotation more to come: total pipeline of around 1.7bn Project Location Delivery date Lettable area (sq.m) Total Pipeline 302, % 5.6% (*) Controlled projects: potential projects identified by Gecina s Asset Management teams and fully controlled by Gecina. (**) Including value of the lands and of the existing buildings when redevelopments 1.3bn identified through the Asset Review process (62% of Gecina s portfolio audited by end-2014, 100% targeted by end-2015) Total investment** Est. yield on cost ( m) Still to be invested ( m) (net) Committed Offices , % Student accommodation , % Healthcare , % Exit yield on delivery (exp.) Total committed 104, % 5.5% Controlled* Greenfield Pre-letting required , % 6.5% Redevelopments Tenant's departure likely , % 5.8% Redevelopments Tenant's departure uncertain , % 5.0% Total controlled 198, % 5.6% Total pipeline moving close to 1.7bn Pipeline by maturity and project type* (investments in m) 1,268m Controlled (linearized) - Redevelopments Controlled (linearized) - Geenfield Committed 440m Controlled Committed Total investment * Assuming City 2 in 2016 for 188m 15

16 Main achievements in 2014: rental management Reversionary potential remained under control in 2014, while visibility is good again for 2015 Limited negative reversionary for offices in 2014 Breakdown of like-for-like office rental growth* 6,0% +3.4% +0.3% 4,0% +0.7% +1.7% -2.8% 2,0% +0.4% 0,0% -3.1% +0.8% +2.8% +2.5% +0.3% 0,5% 0,0% +1.0% +0.8% -0.2% -1.3% -1.1% -0.7% -2,0% -4,0% -3.4% -3.7% -0.9% -0.2% -0.6% -6,0% Index Vacancy Reletting & renegotiations Other * excl. AON impact in 2011 and 2012 Upcoming break-up options: mostly in well-balanced areas Efficient lease management driving vacancy rate down further 14,0% 11.7% 12,0% 10,0% 8,0% 7.2% 6,0% 5.8% 4,0% 4.7% 2,0% 0,0% Gecina's office portfolio Paris Region Western Crescent Paris CBD 2014 achievements and lease maturity m Break-up options other areas Break-up options Western Crescent Break-up options rest of Paris Break-up options Paris CBD 67% 56% > 2021 By end-2014, Gecina had let nearly 84,000 sq.m of offices, factoring in new lettings, relettings, renegotiations and renewals, Representing around 27m of annualized economic rent 7 years weighted average maturity on new lease signed in 2014 Average residual lease maturity (next break): 4.0 years Average residual lease maturity (end of lease): 5.4 years Rental management policy anticipating market trends Rental management tailored to current market conditions Pragmatic for the Inner Rim More aggressive for Inner Paris, particularly in the CBD Keeping the occupancy rate at current standard (>95%), excluding strategic vacancies 16

17 Main achievements in 2014: rental management Main rental and letting challenges Analysis of office break-up options in Paris (by 120 area 000sq m and average yearly rent) Analysis of office break-up options in Paris Region (by area and average yearly rent) Of which 5,300 sq.m still at risk sq m sq m sq m sq m sq m 0sq m 46,205 sq.m 100,188 sq.m 37,142 sq.m 43,767 sq.m 40, 498 sq. m 4,745 sq.m ,215 sq.m ,861 sq.m > Of which 43,000 sq.m still at risk sq m sq m sq m sq m sq m sq m sq m sq m sq m sq m 86,781 sq.m 85,183 sq.m 0sq m 51,394 sq.m 25,630 sq.m 26,433 sq.m 19,717 sq.m 83,126 sq.m 68,323 sq.m > Major vacancy challenges for the office portfolio in 2015 Assets Location Completion or vacating Vacant space Annualized impact on office vacancy rate Annualized impact on Group vacancy rate Docks en Seine Saint-Ouen Dec , % 0.6% Pointe Metro 2 Gennevilliers Dec , % 0.6% Horizons Boulogne , % 0.2% Pointe Metro 2 Gennevilliers 2015e trends for organic rental growth on offices Indexation to slow down (~0% expected) Occupancy to stabilize at current high level Limited negative reversion (~-1% expected) Docks en Seine Saint-Ouen 17

18 Main achievements in 2014: Diversification portfolios Traditional residential portfolio Offices 63% Healthcare portfolio Offices 63% Traditional residential 25% Student accommodation 2% Healthcare 11% Traditional residential 25% Student accommodation 2% Healthcare 11% Student accommodation portfolio Asset value at end-2014: 2.55bn FY rents for 2014: 126.1m, +0.5% lfl, -4.1% yoy Structurally high occupancy rate (97.7%), long-term visibility for cash flow Conservative valuation assumptions: block value assumed in appraisal value, c.20% below unit-based valuations, and 50% below Paris average market values (Chambre des Notaires de Paris) 80m of residential assets were sold in 2014, 33% above last appraisal values New approach for unit-based residential sales, in line with natural tenant turnover, covering 18% of the total residential portfolio, targeting capital gains of over 35% versus block appraisal values Asset value at end-2014: 1.1bn, 73 assets, with 8,300 beds 2 nd largest player in Europe FY rents for 2014: 73.4m, +1% lfl, -0.8% yoy Annualized rents 73m, rental margin structurally close to 100% (99.2% in 2014) 57% Medicine, Surgery, Obstetrics, 32% Nursing Homes, 5% Psychiatry, 5% Followup Care, 1% Other Long-term leases, residual average maturity (firm): 6.9 years, 7.0% net rental yield Offices 63% Traditional residential 25% Student accommodation 2% Healthcare 11% Asset value at end-2014: 196m 11 assets with 1,769 beds today, targeting 6,000 beds over medium term FY rents for 2014: 9.1m, -0.4% lfl, -2.1% yoy*, factoring in a slight drop in Gecina s occupancy ratio on this portfolio 7ongoing projects representing 1,300 beds (investments for around 133m with yield on cost of around 6.4%) * Change of accounting rules on rental expenses billed to tenants. On proforma basis this figure would be +5,9% 18

19 Main achievements in 2014: CSR process ESG process in line with Gecina s guidance % of office buildings with HQE Operations certification Energy consumption trend for office assets* 90% 80% % 0% kwhpe/sq.m/year % 70% 63% % -10% Change vs % 50% 40% 30% 20% 34% 44% % -20% -25% -30% -35% % -23% -22% % % 0% -40% 50 0% 0-45% target ESG process is value enhancing! target (primary energy at constant climate) * On offices assets, when Gecina controls the technical management Performance spread to the total return (Green certified offices vs. High-end non-green offices) 160bp +140bp 140bp 120bp +110bp 100bp 80bp +70bp 60bp 40bp 20bp bp Source: IPD 19

20 Main achievements in 2014: CSR process Process regularly recognized with awards Gecina s award-winning CSR process Gecina recognized as a sector leader by the Global Real Estate Sustainability Benchmark Gecina recognized as a leader by the Carbon Disclosure Project Gecina included in the DJSI World and Europe indices Gecina ranked Silver by EPRA for Best Practices Recommendations Gecina ranked by Novethic as one of the most committed real estate companies in terms of CSR Gecina won the 2014 Trophées des SIIC award in the CSR category Gecina received the 2014 France GBC award for its environmental reporting, for its biodiversity strategy Gecina twice ranked in first place in the 2014 Gaïa-Index rankings 20

21 Main achievements in 2014: financial structure FY 2013 FY 2014 Change LTV (excluding duties) 38.7% 36.7% -200bp LTV (including duties) 36.7% 34.7% -200bp Standard & Poor s: BBB+/ outlook stable Moody s: Baa1 / outlook stable Net financial debt 4,246m 3,881m - 365m ICR 3.0x 3.2x +0.2x Secured debt ratio 11.7% 11.2% -50bp Average gross debt 4,357m 4,143m - 214m 3.5% 3.0% -50bp Average cost of drawn debt (4.0% all in) (3.6% all in) (-40bp all in) Average length of debt 4.9 years 6.2 years* +1.3 years - Proactive management of the hedging portfolio - New bond issues in July 2014 ( 500m at 1.75%, 7-year maturity) and January 2015 ( 500m at 1.5%, 10-year maturity), benefiting from credit rating upgrades - Other refinancing operations and renegotiation of bank facilities in early 2015 Unused credit facilities 1,665m 1,800m +8% (*) At Feb 15, Average maturity was 5.0 years at Dec 31, 2014 Ratios Covenant Dec 31, 2014 Loan to value ratio (block) < 55% 36.7% EBITDA excl. disposals/net financial expenses > 2.0x 3.2x Outstanding secured debt/revalued block value < 25% 11.2% Revalued portfolio value, block ( m) > 6,000 8,000 10,369 21

22 Main achievements in 2014: financial structure Significant improvement in Gecina s financial structure good visibility for 2015 at this stage Key achievements Average cost of debt and LTV Q4 2013: renewal of 510m of bank lines, renegotiation of non-use fees and repayment of 140m of mortgage facilities. July 23, 2014: Gecina placed a 500m 7-year bond issue, with a 1.75% coupon Hedging optimizations throughout the year December January 2015: renegotiation/renewal of a 1bn unused credit line, and mortgage loans January 12, 2015: Gecina placed a 500m 10-year bond issue, with a 1.5% coupon more to come 40bp reduction in average cost of debt in 2014 from 4.0% to 3.6% 48% 46% 44% 42% further 40% 40bp reductionin % to 3.2% 36% 34% 32% 30% -40bp in bp in 2015e e 4,3% 4,1% 3,9% 3,7% 3,5% 3,3% 3,1% 2,9% 2,7% 2,5% LTV Average cost of debt Schedule of available financing (as of 15 th february 2015) Breakdown by type of drawn debt > 2021 Corporate - undrawn Corporate - drawn Secured financing Bonds and convertible % 80% 60% 40% 20% 0% 13% 13% 8% 19% 1% 4% 2% 36% 35% 31% 30% 38% 44% 43% 38% 55% 60% 45% 36% 21% 26% Commercial paper Corporate financing Secured financing Bonds and convertible bond 22

23 CLIQUEZ POUR MODIFIER LE STYLE DU TITRE FY 2014 earnings

24 Décompos FY 2014 earnings: rental income Higher occupancy rates, moderate reversion and slight but positive indexation, bringing positive organic rental growth Rental income by division, rental margins, occupancy rates and annualized rents In million euros Gross rents Change (%) Rental margin Occupancy rate Annualized rents Current Comparable At end-2014 Offices % +0.4% 93.0% 94.1% 93.6% 95.3% 335 Beaugrenelle % n.a. 93.8% n.a. 98.7% n.a. 0 Traditional residential % +0.5% 82.6% 83.7% 98.1% 97.7% 121 Student housing % -0.4% 70.2%* 73.6% 94.9% 92.0% 10 Healthcare % +1.0% 99.1% 99.2% 100.0% 100.0% 73 Other (primarily hotels) n.a. n.a. n.a. n.a. n.a. n.a. Group total % +0.5% 91.4% 91.8% 95.5% 96.4% 539 * 75,9% on pro forma basis Gross rents bridge : m Office rental income by location +16, In million euros Change (%) Current basis Comparable basis Offices % +0.4% Paris CBD - Offices % +1.1% 571,0 Paris CBD - Retail units % +3.2% Paris excl. CBD % -2.8% Western Crescent % 0.0% Other % -0.2% FY 2013 Like-for-like change Invest. & completions Asset restruct. Non-strategic disposals (Hotels & Beaugrenelle) Other disposals FY

25 FY 2014 recurrent net cash flow Solid operating and financial performance offseting disposals impacts in 2014 Change in Recurrent Net Income ( ) Recurrent net income 2013 Change in gross rents Largely driven by non strategic disposals in 2013 (Hotels) and 2014 (Beaugrenelle) Rental margin improvement Change in Overheads costs and other income Rental margin up slightly from 91.4% to 91.8% thanks to the higher occupancy cost ratio on offices and despite the disposals of Hotel assets in 2013 Effective control over salaries and management costs Change in net financial expenses Change in minority interests and tax Recurrent net income 2014 Net financial expenses excl. capitalized interest are down -14.3%. Negative impact of capitalized interest, down - 9.2m to 4.5m as a result of Beaugrenelle s completion 25

26 FY 2014 earnings: appraisal values & NNNAV 2014 portfolio value: contrasting trends in H2: +1% lfl on average in H2, but +5.1% on CBD assets Breakdown by segment Block value Net capitalization rates Change on comparable basis Average value per sq.m In million euros FY 2014 FY months 12 months 2014 Offices 6,482 6, % 6.23% +1.6% +1.5% 7,371 Paris CBD 2,697 2, % 5.29% +5.1% +5.9% 12,871 Of which offices 1,803 1, % 5.90% +2.6% +4.4% 10,068 Of which retail units % 4.06% +10.2% +9.0% 28,223 Paris excl. CBD 838 1, % 7.64% -1.0% -2.1% 5,633 Western crescent 2,130 2, % 6.71% -1.1% -1.8% 6,037 Other % 6.77% -0.1% -0.4% 4,552 Residential 2,750 2, % 4.38% -0.4% -0.9% 4,765 Healthcare 1,106 1, % 7.01% +0.7% +0.4% 1,979 Other 4 6 n.a. n.a. Ns Ns Group Total Group Total unit value 10,341 10,913 10,781 11,368 Net yield by division and offices by area (Dec / Dec. 2014) 5.74% 5.84% +1.0% +0.8% +0.8% +0.6% 8,0% 7,5% 7,0% 6,5% 6,0% 6,2% 6,1% 5,9% 5,7% 7,6% 7,6% 6,9% 6,7% 6,8% 6,6% 7,0% 7,0% 5,84% 5,74% 5,5% 5,0% 4,5% 4,0% 4,1% 3,7% 4,4% 4,4% 3,5% 3,0% Offices (all) Paris CBD - Offices Paris CBD - retail Paris excl. CBD West crescent Others Residential Healthcare Group 26

27 FY 2014 earnings: appraisal values & NNNAV NAV value creation excluding mark-to-market of debt and financial instruments % Asset revaluation Recurrent EPS Other NNNAV end-2013 Dividend paid in 2014 EPRA NNNAV & EPRA NAV Mark to market of NNNAV end-2013 NNNAV end-2014 debt and financial Proforma instruments NNNAV +3.4% over H % vs. end ,9 NNNAV EPRA NAV 103,9 102,2 100,6 101,2 97, H

28 CLIQUEZ POUR MODIFIER LE STYLE DU TITRE Strategic update: Harnessing value creation potential

29 Strategic update One vocation: leading the Paris office market - Promising outlook for office real estate in the Paris Region One priority: harnessing value creation potential Active portfolio rotation strategy, with a total return focus and 4 strategic pillars 1- Capitalizing on opportunities for investment, harnessing our strengths and differentiating features 2- Extracting value reserves within our portfolio 3- Selling non-core and mature assets in a buoyant market 4- Promoting outstanding buildings Stabilized shareholding structure supporting our strategic views - Stabilization of our shareholding structure around Real Estate specialists - looking at the long-term outlook with Gecina Operational reorganization in line with these ambitions - Reorganization based on business lines rather than sectors, supporting the strategy s execution - Optimizing financial, operational and rental management 29

30 One vocation: leading the Paris office market Be the major office specialist in the promising Paris office market Appealing prospects for Paris office market Paris Region: Europe s largest market in terms of take-up Paris market: Europe s leading office market Thousand of sq.m Take up Average (10 y) Unique market depth within the eurozone An increasing number of signals suggesting macro to recover by H2-2015/2016 Paris region's structural and sustainable economic outperformance compared with the rest of France Buoyant medium and long-term outlook for the market (Greater Paris) Central ParisCentral London Munich Francfort Berlin Hambourg Bruxelles Madrid Milan Source: BNP Paribas Real Estate Employee jobs in Paris Region vs. other French regions Average GDP growth by region in France ( ) % 2 Paris region Other French regions 1,5 1,2 0,9 % 1 Forecast 0,6 0,3 0 0,0-0, Source: Insee, BNP Paribas forecast -0,6 Île de France Aquitaine Midi-Pyrénées Pays de la Loire Rhône-Alpes FRANCE Source: Oxford Economics. Languedoc-Roussillon Provence-Alpes-Côte Poitou-Charentes Nord - Pas-de-Calais Bretagne Haute-Normandie Centre Auvergne Alsace Basse-Normandie Picardie Limousin Champagne-Ardenne Bourgogne Lorraine Franche-Comté 30

31 One priority: harnessing value creation potential Active portfolio rotation strategy, with a total return focus and 4 strategic pillars Capitalizing on opportunities for investment, harnessing our strengths and differentiating features In-house expertise (Asset Management, Lease Management, Project Management, Marketing and Sales, etc.) Making it possible to capitalize on value-creating investment opportunities, Managing risks effectively And positioning the Group on real estate cycles on well-known markets Significant potential firepower making it possible to target potential portfolios LTV of 36.7%, well below company s target of 40% (> 550m immediate firepower) Liquid non-strategic assets to feed Gecina s future firepower Knowledge of real estate markets and participants facilitating off-market deals Portfolio scale Making it possible to carry strategic vacancies Recent achievements ( ) Marbeuf (2013) Paris 8 Mirabeau (2013) Paris 15 Le France (2014) Paris 13 City 2 (2015) Boulogne-Billancourt?? 31

32 One priority: harnessing value creation potential Active portfolio rotation strategy, with a total return focus and 4 strategic pillars 2/ Extracting value reserves within our portfolio Total pipeline, including identified & controlled operations Asset reviews carried out by dedicated Asset Manager teams 62% of the Office portfolio audited by end-2014 Targeting 100% by end-2015 Nearly 1.3bn of investments identified to feed our pipeline with an expected yield on cost of around 7% 1,268m Controlled Opportunity studies looking at: Land banks Operations to redevelop or reposition existing buildings 440m Committed Pipeline identified with the asset review process on 62% of Gecina s portfolio at end-2014 Project Location Delivery date Lettable area (sq.m.) Total investment** ( m) Stillto be invested ( m) Est. yield on cost (net) Exit yield on delivery (exp.) Controlled* Greenfield Pre-letting required , % 6.5% Redevelopments Tenant's departure likely , % 5.8% Tenant's departure Redevelopments uncertain , % 5.0% Total controlled 198, % 5.6% (*) Controlled projects: potential projects identified by Gecina s Asset Management teams and fully controlled by Gecina. (**) Including value of the lands and of the existing buildings when redevelopments 32

33 One priority: harnessing value creation potential Active portfolio rotation strategy, with a total return focus and 4 strategic pillars 3/ Selling non-core and mature assets in a buoyant market New approach for unit-based residential sales, in line with natural tenant turnover, covering 18% of the total residential portfolio, targeting capital gains of over 35% versus block appraisal values. Various scenarios currently being reviewed for selling all or part of the non-strategic portfolios. Considering the disposal of mature office assets in a buoyant market context Target portfolio allocation in a mid-term, with a maximum of 20% diversification /sq.m Significant valuation upside on residential to be capitalized on 8,110 49% 21% 5,442 28% Paris residential - Notaries Paris residential (block value) Gecina Paris residential (unit) Gecina H Mid-term target Offices Residential Diversifircation (Logistics, Hotels, Healthcare) Offices Residential Diversifircation (Healthcare) Offices > 80% Diversification (including traditional residential) < 20% 33

34 One priority: harnessing value creation potential Active portfolio rotation strategy, with a total return focus and 4 strategic pillars 4/ Promoting outstanding new-generation office buildings: sound foundations for value creation and growth in the future In response to changing user expectations and practices, Outstanding New-Generation office buildings must be: Connected and open to the city: prime location and visibility, architectural signature, transport connections, open to the region (open data, open office, open source) and open to nature, Responsible: incorporating the 12 responsible building themes from our CSR approach (energy performance, reducing greenhouse gas emissions, recycling, renewable materials, etc.). Target: 80% of the office portfolio certified by end-2016, 40% reduction in greenhouse gas emissions between 2008 and 2016 Flexible and mixed: scalability and capacity to adapt in line with tenants needs, reversibility and transformation of the buildings intended uses, combination of spaces and services Collaborative and focused on employee wellbeing: optimizing elements that contribute towards the building s intangible value (biodiversity, air and water quality, comfort and design, etc.) Rich services with a differentiating, value-creating offer: developing new inter-building services by setting up networks (expansion of shared carparks, superintendent services, third places, co-working spaces, etc.) 34

35 Stabilized shareholding structure supporting our strategic views Stabilization of our shareholding structure around Real Estate specialists looking at the long-term outlook with Gecina Realignment and stabilization of the shareholding structure and the board Entry of Blackstone and Ivanhoé Cambridge, jointly holding a 29,8% stake in the capital as well as Norges Bank and an increase in Predica s interest Gecina s Board of Directors now has the following members around Bernard Michel, Gecina s Chairman: 2 representatives from Ivanhoé Cambridge, 1 from Blackstone, 1 from Predica 5 independent directors, o.w. one is still being recruited End 2012 Start 2014 End 2014 Free float 30,3% Metrovacesa 26,8% Free float 38,8% Metrovacesa 26,7% Free float 44,2% Norges Bank 9,7% Blackstone & Ivanhoé Cambridge 29,9% Treasury stock 3,4% Crédit Agricole Assurances - Predica 8,2% Soler Group 15,2% Rivero Group 16,1% Treasury stock 3,0% Crédit Agricole Assurances - Predica 8,5% Ivanhoe Cambridge + Blackstone 23,0% Treasury stock 2,8% Crédit Agricole Assurances - Predica 13,4% that is now in line with a long-term outlook Helping establish sustainable value creation dynamics while capitalizing on the company s human values and CSR positioning 35

36 Operational reorganization in line with these ambitions Gecina has rolled out a new organizational and remuneration structure aligned with this reinforced strategy Reorganization based on business lines rather than sectors, supporting the strategy s execution Reorganization based on business lines rather than sectors supporting the strategy s execution around the 4 strategic pillars for value creation Capitalizing on opportunities for investment 2/ Extracting value reserves within our portfolio 3/ Selling non-core and mature assets in a buoyant market Promoting outstanding newgeneration office buildings 36

37 Q&A Gecina is effectively positioned to build its future 37

38 CLIQUEZ POUR MODIFIER LE STYLE DU TITRE Appendices

39 FY 2014 recurrent net cash flow 5 In million euros Dec 31, 2013 Dec 31, 2014 Change (%) Gross rental income % Expenses on properties (140.0) (142.7) +1.9% Expenses billed to tenants % Net rental income % Services and other income (net) % Overheads (65.7) (65.1) -0.8% EBITDA % Gains from disposals ,6% Change in fair value of properties (44.2) 21.1 Na Depreciation (5.4) (5.3) -2.2% Net provisions and amortization (5.5) 0.7 Na Operating income % Net financial expenses (162.7) (146.6) -9.9% Financial depreciation and provisions (0.6) 0,0 Na Change in fair value of financial instruments and debt 28.1 (68.3) Na Net income from equity affiliates % Pre-tax income % Recurrent tax (4.2) (3.3) -22.9% Non-recurrent tax Na Exit tax (3.8) (2.7) Na Deferred tax (2.4) 3.4 Na Non-recurrent minority interests (11.4) 1.6 Na Recurrent minority interests (2.3) (1.2) Na Consolidated net income (Group share) % Rental margin up slightly from 91.4% to 91.8% thanks to the higher occupancy cost ratio on offices and despite the disposals of Hotel assets in 2013 Effective control over salaries and management costs Gains from the disposal of Beaugrenelle were recognized in Gains booked in 2014 primarily concern unit-based residential disposals Net financial expenses excl. capitalized interest are down -14.3%. Negative impact of capitalized interest, down - 9.2m to 4.5m as a result of Beaugrenelle s completion 5 Impact of the reduction in interests rates on the valuation of hedging (- 56.7m) and MTM of m for Ornane convertible bonds 6 Recurrent net income - total share % Recurrent net income - Group share % Average number of shares 60,991,382 61,260, % Recurrent net income per share (undiluted) - Group share % % underlying growth restated for the impacts of Beaugrenelle and the hotel portfolio disposals in 2013 and

40 Consolidated balance sheet In million euros In million euros Non-current assets 10, ,201.4 Capital and reserves 6, ,279.0 Investment properties 10, ,827.2 Share capital Buildings under refurbishment Addtional paid-in capital 1, ,890.7 Buildings in operation Consolidated reserves 3, ,623.3 Other tangible fixed assets Consolidated net profit Intangible fixed assets Capital and reserves attibutable to owners of the parent 6, ,268.7 Long-term financial investments Non-controlling interests Share in equity-accounted companies Non-current financial instruments Non-current liabilities 3, ,614.7 Deferred tax assets Non-current financial debt 3, ,501.1 Non-current financial instruments Current assets Deferred tax liabilities Properties for sale Non-current provisions Inventories Trade receivables and related Non-current taxes due & other employeerelated liabilities Other receivables Current liabilities 1, Prepaid expenses Current financial debt 1, Current financial instruments Current financial instruments Cash & cash equivalents Security deposits Trade payables and related Current taxes due & other employeerelated liabilities Other current liabilities TOTAL ASSETS 10, ,546.2 TOTAL LIABILITIES 10, ,

41 Pipeline in detail Project Location Delivery date Lettable area (sq.m.) Total Investment** ( m) Already invested** ( m) To be invested ( M) Est. yield on cost (net) Pre-letting Exit yield on delivery (exp.) % ownership Committed Boulogne Cristallin Hauts de Seine (92) Q , % 0% 100% Amsterdam Paris Q , % 0% 100% Lyon Gerland Rhône (69) Q , % 100% 60% Total offices & commercial 44, % n.a. 5.5% Bagnolet Philia Seine St Denis (93) Q3-15 4, % n.a 100% Bordeaux Blanqui Gironde (33) Q3-15 3, % n.a 5,5 100% Lançon Paris 13 Q2-15 1, % n.a 4,80 100% Palaiseau Saclay Essonne (91) Q3-15 3, % n.a 5,50% 100% Puteaux Rose de Cherbourg Hauts de Seine (92) Q2-18 8, % n.a 5,25% 100% Marseille Mazenod Bouches du Rhônes (13) Q2-17 3, % n.a 5,50% 100% Puteaux Valmy Hauts de Seine (92) Q2-17 3, % n.a 5,25% 100% Total residential 27, % n.a 5.3% Clinique Bayonne Pyrénées Atlantiques (64) Q , % 100% 100% Clinique Orange Vaucluse (84) Q3-15 4, % 100% 80% Total Healthcare 32, % 100% 6.5% Total committed 104, % na 5.5% Controlled* Greenfield Pre-letting required , % 6.5% 100% Redevelopments Tenant's departure likely , % 5.8% 100% Redevelopments Tenant's departure uncertain , % 5.0% 100% Total controlled 198,469 1, % na 5.6% Total Pipeline 302,926 1, % 5.6% (*) Controlled projects: potential projects identified by Gecina s Asset Management teams and fully controlled by Gecina. (**) Including current value of the lands and of the existing buildings when redevelopments 41

42 Office and Residential portfolio breakdowns Office portfolio: rental breakdown by business sector Office asset locations 3%3%3%2% 4% 5% 6% 10% 36% Services Luxury & retail Industry Public sector Telecoms Banking & financial Information & communication technologies Insurance 14% 14% Other Real estate Commuication - TV Residential portfolio: valuation breakdown by region Residential asset locations Other 4% Paris Region 25% Paris 71% 42

43 Healthcare Healthcare lease expiry ( m) Diversification asset locations m > 2021 Breakdown of annualized rental income by tenant type Nursing homes 33% Medicine, surgery, obstetrics 57% Follow-up care and rehabilitation 5% Psychiatry 5% 43

44 Change in GAV and NNNAV Change in GAV (in million euros) , ,913 10,341 Total GAV block dec-31, 2013 Value adjustment on assets Acquisition and capex Disposals Other Total GAV block dec-31, 2014 Unit / Block diff. Total GAV unit dec-31, 2014 Change in NNNAV (in per share) NNNAV end-2013 Dividend Recurring income Val. adjust. assets Val. adjust. derivatives & fixed-rated debt Other NNNAV end

45 The Grand Paris : a new path for growth in a mid term horizon

46 Financial diary April 23 First-quarter business April 24 General meeting July 22 First-half earnings October 21 Third-quarter business 46

47 Disclaimer Appendices This document does not constitute an offer to sell or a solicitation of an offer to buy GECINA securities and has not been independently verified. If you would like to obtain further information concerning GECINA, please refer to the public documents filed with the French securities regulator (Autorité des marchés financiers, AMF), which are also available on our internet site. This document may contain certain forward-looking statements. Although the Company believes that such statements are based on reasonable assumptions on the date on which this document was published, they are by their very nature subject to various risks and uncertainties which may result in differences. However, GECINA assumes no obligation and makes no commitment to update or revise such statements. 47