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NAV Quarterly Update Conference Callas at 30th September 2018
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Asif Siddique
Chief Financial Officer
ENBD REIT
Anthony Taylor
Head of Real Estate
ENBD REIT
Presenting team
NAV Quarterly Update Conference Call as at 30th September 2018 3
www.enbdreit.com NAV Quarterly Update Conference Call as at 30th September 2018
SnapshotAs at 30th September 2018
Portfolio property value
USD 459mProperties
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Offices: 63%
Residential: 19%
Gross yield^
8.3%LTV*
38%Occupancy
90%
Al Thuraya 1
Burj Daman
DHCC 49
DHCC 25
Binghatti Terraces
Arabian Oryx House
Remraam
WAULT 3.75 years
Uninest
Alternative: 18%
South View School
4
The Edge
* Loan-to-value on GAV ^ on property portfolio (gross rental revenue / portfolio value)
Souq Extra Retail Centre
Office: 2.18 years
Residential: 0.68 years
Alternative: 12.87 years
www.enbdreit.com NAV Quarterly Update Conference Call as at 30th September 2018
Financial highlightsH1 2018/2019
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• Net rental income / FFO up 42% on H1 2017/2018
• Gross income up 28% due to acquisitions and highoccupancies
• Cash return on NAV improving
• Unrealised valuation losses impacting net income
www.enbdreit.com NAV Quarterly Update Conference Call as at 30th September 2018
Financial performanceH1 2018/2019
18,990,756
(12,033,554)
6,957,203
(10,418,553)
(3,461,350)
14,830,073
(9,938,096)
4,891,977
2,679,041
7,571,018
(15,000,000)
(10,000,000)
(5,000,000)
0
5,000,000
10,000,000
15,000,000
20,000,000
25,000,000
Sep-18
Sep-17
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USD
Gross income Net rental income / FFO
Net incomeExpenses Unrealised valuation gain/(loss)
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Proposed share capital reduction
NAV Quarterly Update Conference Call as at 30th September 2018 7
As at 30th SeptemberPre share capital reduction
Total assets USD 479m
Total liabilities USD 194m
Total equity (NAV) USD 285m
Share capital USD 288m
Retained earnings (USD 3m)
No dividend payable
NAV per share cum dividend
USD 1.12
NAV per share ex dividend
USD 1.12
As at 30th SeptemberPost share capital reduction
Total assets USD 479m
Total liabilities USD 194m
Total equity (NAV) USD 285m
Share capital USD 204m
Retained earnings USD 81m
Proposed dividend payable USD 0.027 per share
NAV per share cum dividend
USD 1.12
NAV per share ex dividend
USD 1.09
Post dividend payment
Total assets USD 479m
Total liabilities USD 201m
Total equity (NAV) USD 278m
Share capital USD 204m
Retained earnings USD 74m
Dividend paid USD 0.027 per share
NAV per share cum dividend
USD 1.12
NAV per share ex dividend
USD 1.09
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Payments to shareholders
NAV Quarterly Update Conference Call as at 30th September 2018 8
Payments made to shareholders relating to
FY ending 31st March 2018USD
% of NAVUSD 1.18
% of share priceUSD 0.99
Interim dividend (paid 12th July
2017)9,718,131 USD 0.0382 3.24% 3.86%
Final dividend (paid 13th June 2018) 3,281,777 USD 0.0129 1.09% 1.30%
Return of capital (paid 13th June
2018)8,725,966 USD 0.0343 2.91% 3.46%
Total paid to shareholders 21,725,874 USD 0.0854 7.24% 8.63%
Payments made to shareholders relating to
FY ending 31st March 2019USD USD per share
% of NAVUSD 1.12
% of share priceUSD 0.75
Proposed interim dividend*
6,868,836 0.0270 2.41% 3.60%
* To be paid Dec 2018, subject to the approval of the Reduction of Capital at the GM set for 27th November 2018
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NAV highlights
NAV Quarterly Update Conference Call as at 30th September 2018
30th September 2018
Property Portfolio Value USD 459m
Cash USD 15m
Gross Asset Value (GAV) USD 462m
NAV per share USD 1.12
Net Asset Value (NAV) USD 285m
Loan-to-Value (LTV) 38%
Gross rental yield on NAV 13.21%
Net yield on NAV˄ 4.89%
Number of shares in issue 254,401,340
˄ Financial YTD annualized
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www.enbdreit.com NAV Quarterly Update Conference Call as at 30th September 2018
Capital structureas at 30th September 2018
38%
62%
Existing finance terms
• Profit only• Matures 2021• 3-month EIBOR + 3.0%• Repayment:
• 10% end of year 4 (Nov 2020)• 90% end of year 5 (Nov 2021)
Further financing available
• Available drawdown remaining on existing facility: USD 13m
• New facility to be sourced from the market
• Target LTV of 45%
DebtEquity
Equity Debt LTV
USD 285m USD 177m 38%
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www.enbdreit.com NAV Quarterly Update Conference Call as at 30th September 2018
Capital structurePost 30th September 2018
New finance facility signed with Standard Chartered
• USD 75m plus additional USD 25m accordion option• USD 45m to repay ENBD AWAI facility• USD 30m balance for acquisitions (earmarked for Souq
Extra Phase 2) • Commodity Murabaha• 3 year term• Profit only• 3mth LIBOR + 2.15% = 4.75% • (Current facility with Emirates NBD is 3mth EIBOR + 3.14%
= 5.86%)
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114
43
13
37
0
50
100
150
200
250
Lender
ENBD drawn SC drawn ENBD undrawn SC undrawn
6% undrawn
38% drawn
Fully drawn
LTV 44%
USD
m
Portfolio
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Portfolio overview and diversificationBy sector as % of portfolio
NAV Quarterly Update Conference Call as at 30th September 2018 13
Office 63%
Residential 19%
Alternative 18% Education 5%
Student accommodation 7%
Retail 5%
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Residential 20%
Alternative 16%
Diversified tenant mix in the office segment
ICT, 33%
Consultancy & Legal , 27%
Healthcare , 19%
Media , 11%
Sales , 5%
Retail-F&B, 4%
Logistics, 1%Retail , 1%
Office portfolio: 63% of the
overall holdings
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Portfolio characteristics
NAV Quarterly Update Conference Call as at 30th September 2018
84%
100%
74%
86%
90%
87%
97%
90%
100%
99%
100%
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Al Thuraya 1
The Edge
Burj Daman
DHCC49
DHCC25
Binghatti Terraces
Arabian Oryx House
Remraam
Uninest
Souq Extra
South View School
Strong occupancy of 90% across the portfolio
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Offices
63%
Residential
19%
Alternative
18%
Target
50-60%
Target
20-25%
Target
25-35%
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ENBD REIT’s Portfolio has remained strong
NAV Quarterly Update Conference Call as at 30th September 2018
0
50
100
150
200
250
300
350
400
450
500
31/3/17 30/6/17 30/9/17 31/12/17 31/3/18 30/6/18 30/9/18
Overall portfolio valuations
Office Residential Alternative Total
Despite challenging market conditionsU
SD m
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ENBD REIT’s Portfolio has remained strong
NAV Quarterly Update Conference Call as at 30th September 2018
20
40
60
80
100
31/3/17 30/6/17 30/9/17 31/12/17 31/3/18 30/6/18 30/9/18
Office valuations
Al Thuraya 1 Burj Daman DHCC49 DHCC25 The Edge
15
25
35
45
31/3/17 30/6/17 30/9/17 31/12/17 31/3/18 30/6/18 30/9/18
Residential valuations
Binghatti Terraces Arabian Oryx House Remraam
10
15
20
25
30
35
40
31/3/17 30/6/17 30/9/17 31/12/17 31/3/18 30/6/18 30/9/18
Alternative valuations
Uninest South View School Souq Extra Retail Centre
USD
m
USD
m
USD
m
+1%
+1%
Flat
-4%
+3%
+39%
+9%
-17%
-13%
-13%Flat
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Asset snapshot
NAV Quarterly Update Conference Call as at 30th September 2018
Al Thuraya 1Media City
Acquired: Nov 2006
The EdgeDubai Internet
CityAcquired: Oct
2017
Burj DamanDIFC
Acquired: Jun 2015
DHCC 49Healthcare CityAcquired: Apr
2007
DHCC 25Healthcare City
Acquired: Jul 2007
Overall Office
Portfolio
Overall Portfolio
Market value (USD) 90m 77m 68m 31m 25m 291m 459m
% of portfolio value 20% 17% 15% 7% 5% 63% 100%
Net leasable area (Sq. Ft.)
208,565 92,208 87,618 80,808 71,034 540,233 1,293,017
Occupancy rate 84% 100% 74% 86% 90% 87% 90%
WAULT (years) 0.78 2.96 3.25 1.94 2.26 2.18 3.75
Gross rental yield 9.2% 7.7% 6.1% 9.6% 10.2% 8.2% 8.3%*
Office
* Annual contractual rental; excludes cash and debt (gross rental revenue / portfolio value)
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Asset snapshot
NAV Quarterly Update Conference Call as at 30th September 2018
Binghatti TerracesSilicon Oasis
Acquired: May 2016
Arabian Oryx HouseBarsha Heights
Acquired: Oct 2014
RemraamDubailand
Acquired: Sep 2015
Overall Residential Portfolio
Overall Portfolio
Market value (USD) 35m 34m 20m 89m 459m
% of portfolio value 8% 7% 4% 19% 100%
Net leasable area (Sq. Ft.) 178,907 133,432 112,154 424,493 1,293,017
Occupancy rate 87% 97% 90% 91% 90%
WAULT (years) 0.83 0.60 0.53 0.68 3.75
Gross rental yield 8.8% 9.1% 8.4% 8.8% 8.3%*
Residential
* Annual contractual rental; excludes cash and debt (gross rental revenue / portfolio value)
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Asset snapshot
NAV Quarterly Update Conference Call as at 30th September 2018
UninestDubailand
Acquired: May 2017
Souq Extra Retail Centre
Acquired: Dec 2017
South View School
RemraamAcquired: Aug
2017
Overall Alternative
PortfolioOverall Portfolio
Market value (USD) 34m 25m~ 21m 80m 459m
% of portfolio value 8% 5% 5% 18% 100%
Net leasable area (Sq. Ft.) 160,264 36,027 132,000 328,291 1,293,017
Occupancy rate 100% 99% 100% 100% 90%
WAULT (years) 5.66 3.68 34.86 12.87 3.75
Gross rental yield 7.8% 9.2% 9.0% 7.9% 8.3%*
Alternative
~ Further commitment of USD 35m for Phase 2* Annual contractual rental; excludes cash and debt (gross rental revenue / portfolio value)
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New School Opening
NAV Quarterly Update Conference Call as at 30th September 2018
South View School
Highlights• South View School build successfully completed on schedule• School doors opened to students on 2nd Sep 2018 as planned, with all
necessary Dubai Municipality and KHDA approvals• 30 British-qualified teachers have already joined the school• South View School will teach classes up to year 7• Total construction cost of USD 15 million• Property currently valued at USD 21m, representing a valuation gain of 39%• The total ground floor area of the school is 132,000 sq. ft. on a generous plot
area covering 183,504 sq. ft.
Transaction highlights• The deal marks ENBD REIT’s first acquisition of an education asset. South
View School, is operated by Interstar Education, part of Interstar AdvisoryServices, which currently runs the successful and well-established VictoryHeights Primary School in Dubai Sports City, which has just been awarded‘Very Good’ in the 2017/18 KHDA school rankings.
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Financials
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Breakdown of total expensesas at 30th September 2018
NAV Quarterly Update Conference Call as at 30th September 2018
Operating expenses, (3,686,136)
Finance cost, (4,930,135)
Fund expenses, (3,417,283)
USD USD H1 Sep-18 H1 Sep-17 Variance
Gross income 18,990,756 14,830,073 4,160,683
Total expenses (12,033,554) (9,938,096) (2,095,457)
FFONet Rental Income(excl. valuation)
6,957,203 4,891,977 2,065,226
Unrealised valuation gain/(loss)
(10,418,553) 2,679,041 (13,097,594)
Net income (3,461,350) 7,571,018 (11,032,368)
• Increased operating expenses due to assets acquired
• Increased finance costs due to additional drawdown and higher profit rates
www.enbdreit.com NAV Quarterly Update Conference Call as at 30th September 2018
Statement of financial position (USD)as at 30th September 2018
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As at 30th Sep 2018 As at 31st Mar 2018
Investment properties 458,730,200 462,561,122
Cash and cash equivalent 15,301,230 18,693,403
Trade and other receivables 5,190,595 4,913,400
Total assets 479,222,025 486,167,925
Current liabilities
Trade and other payables 16,974,226 16,784,784
Total current liabilities 16,974,226 16,784,784
Non-current liabilities
Mudaraba payable 177,484,345 168,254,833
Payable for investments - 866,728
Total non-current liabilities 177,484,345 169,121,561
Total liabilities 194,458,571 185,906,345
Net Asset Value 284,763,454 300,261,580
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Period ending H1 30th Sep 2018 H1 30th Sep 2017 FY 31st Mar 2018
Rental income 18,930,900 14,320,414 32,434,112
Profit on Islamic Deposits 59,856 509,660 549,366
Net unrealised gain (10,418,553) 2,679,041 559,247
Total income 8,572,203 17,509,115 33,542,725
Operating expenses (3,686,136) (3,457,563) (7,483,319)
Operating income 4,886,067 14,051,552 26,059,406
Other expenses (1,237,732) (1,507,097) (2,365,198)
Management fee (2,179,551) (1,882,682) (4,167,172)
Fund expenses (3,417,283) (3,389,779) (6,532,370)
Finance Costs (4,930,135) (3,090,755) (6,526,011)
Net income (3,461,351) 7,571,018 13,001,025
Statement of comprehensive income (USD)for period ending 30th September 2018
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General [email protected]+971 (0)4 509 3010
Investor RelationsJulia [email protected]+971 (0)4 509 3016
Company SecretaryJean Kenny [email protected]+971 (0)4 428 9221
Tenants/LeasingMelanie [email protected]+971 (0)4 509 3029
MediaGeorge [email protected]+971 (0)4 369 9353
Contact us
ENBD REIT General Meeting 27th November 2018 26
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Disclaimer
NAV Quarterly Update Conference Call as at 30th September 2018
The information, estimates and opinions (“Information”) expressed herein are made in good faith and are based on sources believed to be reliable, but norepresentation or warranty, express or implied, is made as to the accuracy, completeness or correctness of the Information. The Information is not intended to serve asinvestment advice and should not be used as a substitute for independent judgement and advice. This Information has been obtained from or is based upon sourcesbelieved to be reliable, and is believed to be fair and not misleading. The Information contained in this presentation is subject to change without notice. None of ENBDREIT (CEIC) Limited (“ENBD REIT” or the “Fund”), Emirates NBD Asset Management Limited (“Emirates NBD AM”), Emirates NBD Group nor any of their respectivedirectors, employees or agents (the “ENBD Parties”) give any representation or warranty as to the reliability, accuracy or completeness of the Information, nor, to theextent permitted by relevant laws and regulations, do they accept any responsibility or liability arising in any way (including by negligence) for errors in, or omissionsfrom, the Information. None of the ENBD Parties give any undertaking to provide additional information to update this material, or to correct any inaccuracies whichmay become apparent. This document is provided for informational and illustrative purposes only. It does not constitute a solicitation, recommendation or offer to buyor sell any shares or other securities of the Fund, any specific investment product or to subscribe to any specific investment management or advisory service.Prospective investors in ENBD REIT should obtain and carefully read the Fund’s most recent prospectus and supplement, if any, as well as seek separate, independentfinancial advice prior to making an investment in ENBD REIT in order to fully assess the suitability, lawfulness and risks involved.
This presentation is not for distribution to the general public but for intended recipients only and may not be published, circulated, reproduced or distributed in wholeor part to any other person without the written consent of Emirates NBD AM. This presentation is directed to persons authorised to invest in ENBD REIT and residing injurisdictions where the Fund is authorised for distribution or where no such authorisation is required. Investment in ENBD REIT is intended only for investors whounderstand the risks involved in investing in the Fund and can withstand any potential loss therefrom. Neither ENBD REIT’s historical performance nor that of itspredecessor fund, Emirates Real Estate Fund Limited, is indicative of the future performance of the Fund and should not be used as a proxy for the future or likelyperformance of the Fund. The value of the investment in and the income from ENBD REIT can fall as well as rise as the Fund is subject to investment risks, including thepossible loss of the whole of the principal amount invested. The Information does not have any regard to the specific investment objectives, financial situation or theparticular needs of any person.
All Shari’a compliant products and services are approved by the Shari’a Supervisory Board of Emirates NBD AM.
This Information has been prepared by Emirates NBD AM for ENBD REIT. Emirates NBD AM and ENBD REIT are regulated by the Dubai Financial Services Authority.
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