Deutsche Wohnen AG.» Where we stand, where we go. October 2011

Transcription

1 Deutsche Wohnen AG» Where we stand, where we go October

2 » Management team We are committed to combine value and sustainable growth while moving forward Deutsche Wohnen as the leading residential property company in Germany Michael Zahn Chief Executive Officer 19 years of experience in real estate Significant experience in structuring and integrating portfolio and corporate acquisitions. Total transaction volume of residential units successfully executed in the past 8 years Management Board member since 2007 and Chairman since 2008 Helmut Ullrich Chief Financial Officer 23 years of experience in real estate Long-standing track record in private and public real estate capital markets. Spent 17 years as Senior Executive with Deutsche Bank Group / RREEF Management Board member since 2007 Lars Wittan Deputy Chief Financial Officer 5 years of experience in real estate Expertise in Accounting, Tax, Risk, Controlling and Auditing. Previously, German Certified Public Accountant with Ernst & Young Management Board member since October Joined Deutsche Wohnen in

3 » Market environment Country Germany: comparatively strong economy with safe haven status Asset class German Residential Real Estate Within Real Estate Residential Pure residential player» Good risk/return profile» Attractive market segments» Focus on urban areas - Greater Berlin - Frankfurt/Main, Rhine-Main - Rhine-Valley North/-South ~ 93% of entire portfolio Opportunities from residential market characteristics Poor or negative supply from construction activities Increasing demand» Re-urbanisation» Increasing # of households Following this trend» Increasing rents + values Capital market Member of MDAX 3

4 » German residential: a resilient investment class Continuing rent increase since 2004 despite the financial crisis and the corresponding decrease in GDP Rent development in German Cities 1) Rental spending in % of net income 2) EUR/sqm % % 3.3% 3.7% 1.1% % EUR/m2 % household net income Berlin Munich Frankfurt Berlin Munich Frankfurt GDP (Change to previous year in %, adjusted for price impacts) In place rental level New letting rental level Deutsche Wohnen management expects continued rental growth in Metropolitan Areas due to movement from rural to urban regions and increasing number of households in urban areas Development of residential rents in Metropolitan Areas decoupled from pace of economic growth Expected growth in household net income allows for further rental growth 1) Based on rent index 2) Household net income / rents 4

5 » Berlin: a residential market dominated by landlords Rent index in 2009 politically influenced, but in 2011 the low level of 2009 was compensated Average increase was 2.6% p.a. in previous years Dynamic growth of new-letting rent in unrestricted letting portfolio in Berlin due to the quality of locations and buildings Further rent potential through increasing new-letting rent 5

6 » Operational performance track record Management has delivered on its promises: Shaping Deutsche Wohnen after the GEHAG transaction and the capital increase in 2009 FY 2008 H /- Acquisitions to be closed after 30 June 2011 Key operating metrics Residential units (# of units) 50,489 48, % 4,274 Residential lettable space (Tm sqm) 3,101 2, % 255 In-place rent (LP in core regions) 6) (EUR/sqm/month) % New letting rent LP in core regions (unrestricted) (EUR/sqm/month) % Rent Potential (%) 15% 18% 24.0% Vacancy (LP in core regions) (%) 4.0% 1.8% -55.0% Vacancy (%) 5.9% 3.2% -45.8% 7) Corporate expenses (EURm) % Key financial metrics NOI from letting (EURm) n/a NOI margin (%) 65% 75% n/a EPRA NAV per share (EUR) 3) % LTV (%) 70.6% 60.7% -14.0% Interest ratio 1) % 4) 2) FFO per share (without disposals, full year) (EUR) % FFO per share (without disposals, full year) 5) 2) (EUR) % FFO yield (FFO per share without disposals / EPRA NAV) (EUR) 1.4% 4.6% 226.6% 1) Interest ratio = NOI from lettings divided by current interest expense 2) Management guidance for FY 2011, based on 81.84m shares 3) EPRA NAV 2008 adjusted by capital increase 2009 less corresponding costs divided by m shares 4) Based on 26.40m shares 5) Based on 81.84m shares 6) LP letting portfolio 7) FY

7 » Acquisitions of ~ 8,000 units in core regions Accretive acquisitions and realisation of economies of scale Deutsche Wohnen FY 2010 Region Berlin Rhine-Main Rhine Valley South Acquisitions 2010 and 2011 Rhine Valley North Total Portfolio Residential units 1) 47,688 5, ,160 7,937 GAV (EURm) 2, Vacancy (%) In-place rent (EUR/sqm/month) Estimated Potential rent (EUR/sqm/month) Rent potential 16% 18% 24% 16% 17% 18% LTV 60.6% KPIs NOI (EURm) NOI margin (%) GAV yield 2) 5.0% 5.7% 6.2% 5.9% 5.1% 5.6% FFO without sales pre tax (EURm) Pre-tax FFO per sqm Pre-tax FFO yield FY 2010 and incremental contribution 3) 4.3% 8.5% 8.7% 8.0% 6.1% 8.0% 4) 4) 4) 4) 4) 1) Including acquisitions ) NOI (EURm) divided by GAV (EURm) 3) FFO w/o sales pre tax divided by equtiy December 31, ) FFO w/o sales pre tax divided by assumed equity portion based on LTV 60% 7

8 » Banks show strong interest to finance DW Letting portfolio Privatisation Total Gross asset value (EURm) ) Mortage debt LTV 65% 66% 65% Margin (bps) ~ 135 ~ 240 ~ 150 Interest rate 2) (incl. Margin and hedging) (bps) ~ 370 ~ 390 ~ 370 Hedging ratio 77% 0% 64% Credit lines utilized/cash Estimated Deutsche Wohnen LTV post acquisitions: 63.5% Who are the financing banks? 1) Thereof EUR111 m still under negotations 2) Estimated 3M Euribor 150 bps 8

9 » Key take-aways Deutsche Wohnen has been able to purchase ~ 8,000 units entirely in core regions Improvement of the existing portfolio structure (~ 93% located in core regions) due to the acquisitions and the continuing sale of the disposal portfolio, in particular the adjustment portfolio Realization of economies of scale: Previous acquisitions can be integrated without significant incremental costs, i.e. corporate expenses Any future acquisitions in core regions are expected to result in additional economies of scale => Further strengthening of Deutsche Wohnen s cost leadership Financing at attractive margins despite a higher LTV level show the financing power of Deutsche Wohnen 9

10 » Growth story to be continued with focus on top Metropolitan Areas Metrics of core regions of Deutsche Wohnen1) Focus on top German Metropolitan Areas In-place rent Residential letting portfolio (in EUR per sqm) Rent potential 2) Residential letting portfolio (in %) Hamburg Approx BRANDENBURG Greater Berlin Bremen Oldenburg BERLIN SAXONYTHURINGIA Hanover -Braunschweig Göttingen -Wolfsburg DUSSELDORF Rhine land Vacancy by regional cluster Residential letting portfolio (in %) Frankfurt/ Rhine -Main FRANKFURT Frankfurt Berlin Dusseldorf Core / Main regions Sachsendreieck RHINE VALLEY, NORTH RHINE-MAIN Frankfurt Berlin Dusseldorf Core / Main regions 1.8% 1.3% Nuremberg Rhine Neckar 1.1% 1.1% Fair value Residential letting portfolio (in EUR per sqm) 1,438 1, RHINE VALLEY, SOUTH Stuttgart Munich Metropolitan Areas Deutsche Wohnen portfolio locations Frankfurt Berlin Dusseldorf Core / Main regions 1) 2) Frankfurt Berlin Dusseldorf Core / Main regions As of 30 June Core regions do not include Dusseldorf Average rent from contracts signed in the last twelve month for units not subject to rent control compared to the monthly in-place rent 10

11 » Outlook Continue portfolio optimization Integration of new acquisitions to realize value creation potential Disposal program to be continued at previous or higher margin levels Maintain leverage discipline LTV target of <60% in the mid-term Refinancing options for credit lines utilized for new acquisitions to be considered to re-load fire power Proceed with growth strategy FFO yield target on EPRA NAV of 5% in the mid-term Internal growth through realization of incremental rent potential Focused and disciplined acquisition strategy to be continued in order to secure additional value creation potential 11

12 » Pictures of recent acquisitions Berlin Dusseldorf 12

13 » Disclaimer This presentation contains forward-looking statements including assumptions, opinions and views of Deutsche Wohnen or quoted from third party sources. Various known and unknown risks, uncertainties and other factors could cause actual results, financial positions, development or performance of the company to differ materially from the estimations expressed or implied herein. The company does not guarantee that the assumptions underlying such forward-looking statements are free from errors nor do they accept any responsibility for the future accuracy of the opinions expressed in this presentation or the actual occurrence of the forecasted developments. No representation or warranty (expressed or implied) is made as to, and no reliance should be placed on, any information, including projections, estimates, targets and opinions, contained herein, and no liability whatsoever is accepted as to any errors, omissions or misstatements contained herein, and accordingly, none of the company or any of its parent or subsidiary undertakings or any of such person s officers, directors or employees accepts any liability whatsoever arising directly or indirectly from the use of this document. Deutsche Wohnen does not undertake any obligation to publicly release any revisions to these forward-looking statements to reflect events or circumstances after the date of this presentation. 13

14 Deutsche Wohnen AG Head Office Pfaffenwiese Frankfurt am Main Berlin Office Mecklenburgische Straße Berlin Telefon: Telefax: Deutsche Wohnen AG 14