Presentation for: Water and Power Employees’ · 09/08/2017 · management services). Further,...

Water and Power Employees’Retirement Plan

Presentation for:

August 9, 2017

Please see appendix for important disclaimers and other important information.In addition, please note that this presentation does not constitute (i) an offer to sell, or the solicitation of an offer to buy, any interests in any investment vehicle, or (ii) a solicitation for any investment advisory or asset management services ofHeitman or any of its affiliates. Any such offer or solicitation, if made, will only be made by means of a placement memorandum (in the case of an investment vehicle) or a proposed investment advisory agreement (in the case of advisory or assetmanagement services). Further, this presentation is subject to correction, completion and amendment without notice.

Table of Contents

2Table of Contents

Heitman Overview 3Investment Process and Discipline 7Market Overview 11Performance Review 17Portfolio Review & Characteristics 25Conclusion 33APPENDICES

35373941

Jerry EhlingerMANAGING DIRECTOR, PUBLIC REAL ESTATE EQUITY – NORTH AMERICAT: +1.312.425.0790 • [email protected]

John MancusoSENIOR VICE PRESIDENT, CLIENT SERVICE & MARKETING – NORTH AMERICAT: +1.312.912.6672 • [email protected]

Heitman is a Real Estate Specialist

3Heitman Overview

As of June 30, 20171. The remaining 50% is owned by a US subsidiary of Old Mutual, a publicly traded, London-based global financial services firm.

50 yearsinvesting on behalf of clients with anexclusive focus on real estate

$39 billionmanaged across three complementarybusiness units

39 partnersfrom across the Heitman platform own 50%of the company¹ and control all strategicand day-to-day operational decisions

CHICAGOLOS ANGELES

LONDONFRANKFURT

LUXEMBOURGMUNICH

WARSAWHONG KONGMELBOURNE

SEOULTOKYO

11Offices

351Employees

$34BPRIVATE EQUITY

$800MPRIVATE DEBT

$4.1BPUBLIC EQUITY

Client RelationshipsBuilt on Trust and Experience

4Heitman Overview

AUM of $38.5 billion as of June 30, 2017Heitman selected clients for inclusion in this list to indicate the scope of clients served using the following criteria:category, geographic location, size, investment style and name recognition.Only clients who have consented to their name appearing on this list have been included, however, their inclusion is notconstrued to be approval or disapproval of Heitman or its advisory services.1. Other clients include: Individual, Endowment/Foundation, Union/Taft-Hartley, Insurance, Fund of Funds, and

Sovereign Wealth Funds2. Corporate includes sub-advised and model-only portfolios

North America$23,904

72%North America

$27,899

10%Europe$3,798

18%Asia-Pacific

$6,828

TOTAL AUM BY DOMICILE

60%Public

$23,206

33%Corporate²

$12,571

7%Other¹$2,748

TOTAL AUM BY CLIENT TYPEREPRESENTATIVE CLIENT LIST

APG InvestmentsATP Real EstateBT Investment Solutions (Australia)California State Teachers’ Retirement SystemExelon CorporationGE Capital Real EstateHI Asset Management Co., LtdL-3 Communications CorporationMunich Ergo Asset Management GmbHNational Pension Service (South Korea)Navy Exchange Service Command Retirement TrustNew York State Common Retirement FundNomura Asset Management Co., Ltd.Ohio Public Employees Retirement SystemPennsylvania State Employees’ Retirement SystemProducer-Writers Guild of AmericaSompo Japan Nipponkoa Asset Management Co., Ltd.State Board of Administration of FloridaState of Wisconsin Investment BoardStichting Instituut GakSyntrus AchmeaSunsuper (Australia)Teacher Retirement System of TexasTeachers' Retirement System of the State of IllinoisThe Korean Teachers’ Credit UnionTokio Marine Asset Management Co., Ltd.

Industry experience and local expertise28 years managing real estate securities

• US since 1989• Global since 2007

On-the-ground, senior decision-makinginvestment teams in each region

27 professionals around the globe with officesin Chicago, Munich, London, Melbourne, andHong Kong

Award-winning investment strategies

• Institutional Investor US InvestmentManagement Award – REITs

• AsianInvestor Asset Management Award –Global REITs

• Lipper Fund Awards – US REITs¹

12%Global

Diversified,$493M

14%Global Focused,

$585M

35%Prime,

$1,427M

28%US Diversified,

$1,170M

2%US Focused,

$89M

9%US High

Yield,$385M

$4.1 BILLION IN AUM BY STRATEGY

Heitman Public Real Estate Equity

5Heitman Overview

As of June 30, 20171. From Thomson Reuters Lipper Awards, ©2017 Thomson Reuters. All rights reserved. Used by permission and protected by the Copyright Laws of the United States. The printing, copying, redistribution, or

retransmission of this Content without express written permission is prohibited.

Heitman’s Global Public Equity Team

6Heitman Overview

As of June 30, 20171. Jerry Ehlinger was with Heitman’s Public Securities group from 2000 to 2004; he rejoined in 2013 as Managing Director & Portfolio Manager of the North America team.2. John White began his relationship in 2007 as a Portfolio Manager at Challenger Financial Services Group, Heitman’s former strategic partner covering Asia-Pacific

Bill PogorelecDIRECTOR OF OPERATIONS

David RadziwonSR. TRADING ADMINISTRATOR

Colleen CallahanTRADING ADMINISTRATOR

Paul WilsonTRADING ADMINISTRATOR

Michael ServialRECONCILIATION ASSOCIATE

EUROPEMark Abramson

MANAGING DIRECTOR, PORTFOLIO MANAGER

ASIA-PACIFICJohn White²


NORTH AMERICAJerry Ehlinger, CFA¹


INVESTMENTTEAM

GLOBALINVESTMENTCOMMITTEE

227

2312

2610

Kathy SandstromSenior Managing Director

Years ExperienceFirm Tenure

21

21

Mike Moran, CFAGLOBAL INVESTMENT STRATEGY

Shruti WaghrayGLOBAL INVESTMENT ANALYSIS

Will LouxSENIOR ASSOCIATE

Tony VoASSOCIATE

Diane LehmannPORTFOLIO COORDINATOR

STRATEGY &ANALYTICS

OPERATIONS

1311

129

55

52

2424

2422

111

8<1

221

Jeff Yurk, CFAASSISTANT PORTFOLIO MANAGER

Charles Harbin, CFAASSISTANT PORTFOLIO MANAGER

Adam CristelliASSISTANT PORTFOLIO MANAGER

Mat SpencerANALYST

Gabriel HilmoeANALYST

Mark ZaharaHEAD TRADER

Vicky MadisonTRADER

1513

157

1010

62

131

1717

Karena FungASSISTANT PORTFOLIO MANAGER

Jeff Mak, CFAASSISTANT PORTFOLIO MANAGER

Masayuki OzakiSENIOR ANALYST

Philip HunterTRADER

Jacques PerdrixPORTFOLIO MANAGER, SVP

Andreas WelterPORTFOLIO MANAGER, SVP

Peter BurdettTRADER

135

158

102

194

156

164

131

51

111

Philosophy & Approach

As of June 30, 2017

7Investment Process & Discipline

$34.4 billionprivate portfolio

Experienced and localsecurities teams

Private realestate expertise

Public marketacumen

Sophisticatedportfolio

construction &risk management

Top quartileperformance

Over the long term,underlying real estate

and management’sability to affect value

drive share prices

Short-term pricinginefficiencies createalpha opportunities

Pillars of Portfolio Construction


FundamentalResearch

CompanyAnalysis

Active RiskManagement

MacroAnalysis

Summary of WPERP’s Investment GuidelinesPORTFOLIO GUIDELINES:

1. Global securities with minimum market capitalizations of $200mm at purchase, restricted to those listed on major local-countrystock exchanges. Investible markets are those within the FTSE EPRA/NAREIT Developed Index

2. Non-currency derivatives within the portfolio are not permissible without the expressed written consent of the Plan

3. Currency hedging maximum of 25% of the portfolio

4. Minimum of 50 issues quoted in at least 10 countries/regions. The maximum size of any single issue shall be the greater of 5%of the portfolio or 125% of the benchmark weight, except at no time shall any specific issue represent more than 10% of thelesser of cost or market value of the portfolio. No issue purchased in the portfolio if more than 10% of outstanding share of thatcompany are held by Heitman in the total of all accounts

5. Cash equivalent not to exceed 5% of the portfolio

6. Turnover not to exceed 150% in any twelve month period

PORTFOLIO CHARACTERISTICS:

1. Invested in broad array of countries within the FTSE EPRA/NAREIT Developed Index

2. Weighted average dividend yield on a quarterly basis to be within a +/- 0.5x range of the market as represented by the FTSEEPRA/NAREIT Developed Index

3. Market sensitivity (beta) to be no less than 0.80 and no greater than 1.20 of the market as represented by the FTSE EPRA/NAREITDeveloped Index on a 24-month rolling basis, using monthly holdings data

PERFORMANCE OBJECTIVES:

a market cycle of three-to-five years

COMPLIANCE:


PAGE INTENTIONALLY BLANK


Investment Themes & Outlook

11Market Overview

GLOBAL INVESTMENT OUTLOOK

Macro Economy

pace driven by structural headwinds

Capital Markets

continued access to equity and debt capital globally

the capital markets remain robust

Real Estate Markets

growth which drives demand for commercial real estate

of funding due to tighter regulations on banks

-2

-1

0

1

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Jun-

16Se

p-1

6D

ec-1

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ar-1

7Ju

n-17

Spread L-T Avg.

DIVIDEND YIELD SPREAD TO GLOBAL BONDSFTSE EPRA/NAREIT DEVELOPED INDEX

-50%

-40%

-30%

-20%

-10%

0%

10%

20%

30%

40%

Jun-

07

Nov

-07

Apr

-08

Sep

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Feb-

09Ju

l-09

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12Ju

n-12

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Feb-

14Ju

l-14

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Oct

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Mar

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Aug

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Jan-

07Ju

n-17

PREMIUM/(DISCOUNT) TO NAVFTSE EPRA/NAREIT DEVELOPED INDEX

As of June 30, 2017Sources: Heitman Research, FTSEEPRA/NAREIT

NORTH AMERICA INVESTMENT OUTLOOK

Macro Economy

boost from pro-growth fiscal policies and reducedregulations

in oil while US trade policy poses additional risk

Capital Markets

investors

companies have successfully issued 30-year bonds

Real Estate Markets

trend growth as new supply remains in check

slowed given uncertainty


12Market Overview

PREMIUM/DISCOUNT TO NAV BY REGION –FTSE EPRA/NAREIT DEVELOPED INDEX

-3-2-1012345678

Jun-

06

Sep

-06

Dec

-06

Mar

-07

Jun-

07

Sep

-07

Dec

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Mar

-08

Jun-

08

Sep

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p-1

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p-1

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ar-1

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Mar

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Jun-

16Se

p-1

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ar-1

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n-17

Spread L-T Avg.

FTSE EPRA/NAREIT NORTH AMERICADIVIDEND YIELD SPREAD TO BONDS


-3

-2

-1

0

1

2

3

4

5

Jun-

06

Sep

-06

Dec

-06

Mar

-07

Jun-

07

Sep

-07

Dec

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Mar

-08

Jun-

08

Sep

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Jun-

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Spread L-T Avg.

FTSE EPRA/NAREIT EUROPEDIVIDEND YIELD SPREAD TO BONDS

EUROPE INVESTMENT OUTLOOK

Macro Economy

lagged effects of QE support the economy

the Nordic and some peripheral regions (Spain/Ireland)providing better relative growth

Capital Markets

continue to cause near-term uncertainty

support capital markets

Real Estate Markets

and countries


13Market Overview

PREMIUM/DISCOUNT TO NAV BY REGION –FTSE EPRA/NAREIT DEVELOPED INDEX


ASIA-PACIFIC INVESTMENT OUTLOOK

Macro Economy

performance in the short-term in Asia ex-Japan but will be apositive tailwind for Japan and Australia

currencies will positively contribute to growth later in 2017

Capital Markets

monetary conditions which will accelerate capital outflowsand reduce lending activity

Real Estate Markets

property markets; sluggish retail demand in Hong Kong andSingapore are balanced against a stronger Australian officesector

and Australia, otherwise expect stable values


14Market Overview

PREMIUM/(DISCOUNT) TO NAV BY REGION –FTSE EPRA/NAREIT DEVELOPED INDEX

0

1

2

3

4

5

6

7

Jun-

06

Sep

-06

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-06

Mar

-07

Jun-

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Sep

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Spread L-T Avg

FTSE EPRA/NAREIT ASIA-PACIFICDIVIDEND YIELD SPREAD TO BONDS


Interest Rates and US REITs

After initially lagging, US REITs tend to outperform following spikes in interest rates

15Market Overview

As of June 30, 2017Source: Bloomberg, Heitman US REITs = FTSE NAREIT Equity REITs Index, US Stocks = S&P 500 Index

Period Change of 10YTreasury Yield

Total Return US REITs US Stocks

Start End # ofDays

USREITs

USStocks

After30 Days

After90 Days

After180 Days

After30 Days

After90 Days

After180 Days

10/31/2001 3/14/2002 134 +118 bps 15.1% 9.4% 5.9% 4.2% 0.1% -4.3% -11.2% -20.5%6/13/2003 9/2/2003 81 +149 bps 7.9% 3.7% 3.7% 9.7% 20.4% 0.0% 5.2% 14.1%3/16/2004 5/13/2004 58 +117 bps -13.4% -1.0% 7.7% 15.0% 30.0% 2.8% -1.5% 7.1%

12/30/2008 6/10/2009 162 +189 bps -3.3% 6.8% -12.7% 17.9% 32.8% -6.2% 9.8% 18.7%10/7/2010 12/15/2010 69 +115 bps -0.8% 7.1% 6.2% 8.5% 12.0% 4.8% 4.3% 3.9%5/2/2013 9/5/2013 126 +137 bps -14.3% 4.4% 4.6% 3.1% 15.2% 1.4% 8.9% 14.4%7/8/2016 12/15/2016 160 +124 bps -8.6% 7.2% 3.7% 3.4% - 0.7% 6.0% -

Average Performance -2.5% 5.4% 2.7% 8.8% 18.4% -0.1% 3.1% 6.3%

(Dec 31st 2000 = 100)

1.0%1.5%2.0%2.5%3.0%3.5%4.0%4.5%5.0%5.5%6.0%6.5%

050

100150

200250300350400450500550600

Jan-01 Jan-02 Jan-03 Jan-04 Jan-05 Jan-06 Jan-07 Jan-08 Jan-09 Jan-10 Jan-11 Jan-12 Jan-13 Jan-14 Jan-15 Jan-16 Jan-17

US REIT(LHS) US Stock(LHS) US 10Y Treasury Yield(RHS)

Investing in REITs is Investing in Real Estate:Key Classification System Changes

WHAT?September 2016, stock-exchange listed real estatecompanies will be reclassified under GICS, moving fromunder the financials sector and elevated to a new 11thheadline real estate sector.

1. Based on GICS Classification and equity market capitalization of companies in the S&P Composite 1500 as of December 31, 2015

16Market Overview

Banks

Diversified Financials

Insurance

Global IndustryClassification Standard

(GICS)

Consumer Discretionary

Consumer Staples

Energy

Financials

Health Care

Industrials

Information Technology

Materials

Telecom Services

Utilities

Real Estate

97% Equity REITs3% Real EstateManagement +DevelopmentCompanies¹

Enhance Asset Class Visibility

Diversify Ownership of Real Estate Equities

Promote Portfolio Diversification

WHY?Over the past 25 years, the market cap of the listed US REITindustry has grown from $9 billion to $900 billion. There arenow 26 REITs in the S&P 500, underscoring the sector’s growthand contribution to the investment universe of equity assets.

IMPLICATIONS?The creation of the new Real Estate sector in GICS will increasethe visibility of real estate investment as a distinct asset classwithin the universe of equity securities. This distinction andvisibility will empower investors, their advisors and investmentmanagers to allocate more appropriately to listed real estateequities, including listed equity REITs, in well constructeddiversified portfolios.

This shift towards REITs from both a retail and an institutionalinvestor point of view may also help:

LA Water and Power Employees’Retirement Plan Performance

17Performance Review

1. Returns are calculated and presented in US Dollars. Periods Ending 6/30/17.2. FTSE EPRA/NAREIT Developed IndexPlease read Performance Notes pages for important disclosure information

ENDING MARKET VALUE AS OF JUNE 30, 2017: $22,664,480

Portfolio Portfolio FTSE EPRA/NAREIT Spread Spread(Gross of Fee)1 (Net of Fee)1 Developed Index (Gross of F ee) (Net of F ee)

Month To Date 0.96% 0.91% 0.88% +0.08% +0.03%Quarter To Date 3.05% 2.89% 3.01% +0.04% -0.12%Year To Date 5.08% 4.75% 5.37% -0.29% -0.62%Rolling One Year 1.15% 0.52% 1.14% +0.01% -0.62%Rolling Three Years 4.98% 4.33% 4.56% +0.42% -0.23%Since Inception (10/31/13) 6.82% 6.15% 6.09% +0.73% +0.06%

0.96%

3.05%

5.08%

1.15%

4.98%

6.82%

0.91%

2.89%

4.75%

0.52%

4.33%

6.15%

0.88%

3.01%

5.37%

1.14%

4.56%

6.09%

0%

1%

2%

3%

4%

5%

6%

7%

8%

Month To Date Quarter To Date Year To Date Rolling One Year Rolling Three Years Since Inception(10/31/13)

Gross of Fees¹

Net of Fees¹

Index²

Portfolio Portfolio FTSE EPRA/NAREIT Spread Spread(Gross of Fee)1 (Net of Fee)1 Developed Index (Gross of F ee) (Net of F ee)

Month To Date 0.97% 0.92% 0.88% +0.09% +0.04%Quarter To Date 3.06% 2.90% 3.01% +0.05% -0.11%Year To Date 5.09% 4.76% 5.37% -0.28% -0.61%Rolling One Year 1.17% 0.54% 1.14% +0.03% -0.60%Rolling Three Years 4.99% 4.33% 4.56% +0.43% -0.23%Since Inception (10/31/13) 6.82% 6.16% 6.09% +0.73% +0.07%

LA Water and Power Employees’Retiree Health Benefit Plan

1. Returns are calculated and presented in US Dollars. Periods Ending 6/30/17.2. FTSE EPRA/NAREIT Developed IndexPlease read Performance Notes pages for important disclosure information

0.97%

3.06%

5.09%

1.17%

4.99%

6.82%

0.92%

2.90%

4.76%

0.54%

4.33%

6.16%

0.88%

3.01%

5.37%

1.14%

4.56%

6.09%

0%

1%

2%

3%

4%

5%

6%

7%

8%

Month To Date Quarter To Date Year To Date Rolling One Year Rolling Three Years Since Inception(10/31/13)

Gross of Fees¹Net of Fees¹Index²

ENDING MARKET VALUE AS OF JUNE 30, 2017: $5,645,295

Performance Review 18


Performance Review

LA Water and Power Employees’ Retirement Plan LA Water and Power Employees’ Retiree Health Benefit Plan6/30/2017 6/30/2017

1 Year 3 Years 1 Year 3 Years

l LA Water ERP 1.15 4.98 l LA Water ERHBP 1.17 4.99

1st Quartile 1st Quart ile

2nd Quart ile 2nd Quart ile

3rd Quart ile 3rd Quart ile

4th Quart ile 4th Quart ile

High 16.19 9.59 High 16.19 9.5925th Percentile 3.72 5.68 25th Percentile 3.72 5.68Median 1.57 4.69 Median 1.57 4.6975th Percentile -0.04 3.99 75th Percentile -0.04 3.99Low -3.15 -1.60 Low -3.15 -1.60Observations 56 53 Observations 56 53

Source: eVestment; Heitman Source: eVestment; HeitmanQuartile performance ranking calculated using the Global Diversified Developed Composite Quartile performance ranking calculated using the Global Diversified Developed Composite

Returns calculated and presented in USD and Gross of Fees for the Composite. As of 6/30/17 Returns calculated and presented in USD and Gross of Fees for the Composite. As of 6/30/17

COMPETITIVE PERFORMANCE IN USD COMPETITIVE PERFORMANCE IN USD

19

LA WATER AND POWER EMPLOYEES’RETIREMENT PLAN

LA WATER AND POWER EMPLOYEES’RETIREE HEALTH BENEFIT PLAN


Performance Review

LA Water and Power Employees’ Retirement Plan LA Water and Power Employees’ Retiree Health Benefit Plan6/30/2017 6/30/2017

2016 2015 2014 2016 2015 2014l LA Water ERP 4.33 1.10 18.15 l LA Water ERHBP 4.33 1.13 18.13

1st Quart ile 1st Quart ile

2nd Quart ile 2nd Quart ile

3rd Quart ile 3rd Quart ile

4th Quart ile 4th Quart ile

High 14.33 6.13 25.04 High 14.33 6.13 25.0425th Percentile 4.96 2.58 18.33 25th Percentile 4.96 2.58 18.33Median 4.00 1.28 16.60 Median 4.00 1.28 16.6075th Percentile 1.73 -0.11 14.87 75th Percentile 1.73 -0.11 14.87Low -1.41 -21.97 11.28 Low -1.41 -21.97 11.28Observations 58 58 54 Observations 58 58 54

Source: eVestment; Heitman Source: eVestment; HeitmanQuartile performance ranking calculated using the Global Diversified Developed Composite Quartile performance ranking calculated using the Global Diversified Developed Composite

Returns calculated and presented in USD and Gross of Fees for the Composite. As of 6/30/17 Returns calculated and presented in USD and Gross of Fees for the Composite. As of 6/30/17

COMPETITIVE PERFORMANCE IN USD COMPETITIVE PERFORMANCE IN USD

20

LA WATER AND POWER EMPLOYEES’RETIREMENT PLAN

LA WATER AND POWER EMPLOYEES’RETIREE HEALTH BENEFIT PLAN

Retail22.9%

Office19.8%

Residential15.8%

Diversified16.0%

Industrial9.5%

Health Care7.6%

Self-Storage3.5%

Hotel/Resort &Entertainment

3.6%Specialty1.2%

SECTOR WEIGHTINGS

Global Diversified Developed Strategy


PORTFOLIO CHARACTERISTICS

Heitman Index¹

Number of Securities 112 335

Top 10 Holdings 23.52% 19.96%

Active Share

Beta 0.99 1.00

Dividend Yield 3.47% 3.87%

NAV Prem/(Disc) -4.40% -2.29%

Earnings Growth 4.01% 3.46%

LTV 30.01% 31.09%

51.15%

As of June 30, 2017.The Portfolio Characteristicsshown aboveare supplemental information to the Global Diversified Developed Strategy Composite.1. FTSE EPRA/NAREIT Developed Index and the respectiveregional sleeves.

Japan, 10.67%

Hong Kong, 7.64%

Australia, 5.54%

Singapore, 2.38% US, 53.84%

Canada, 3.00%

Europe, 11.91%

UK, 5.02%

Asia-Pacific26%

North America57%

Europe17%

0%

10%

20%

30%

40%

50%

60%

70%

Asia-Pacific North America Europe

COUNTRY WEIGHTINGS

OVERWEIGHTS/UNDERWEIGHTSSecurity Sector Heitman Active Weight

CubeSmart Storage 2.02% +1.71%

HCP Health Care 2.47% +1.41%

GGP Retail 2.38% +1.36%

Equinix Office 1.35% +1.35%

National Retail Properties Retail 1.72% +1.31%

Realty Income Specialty 0.00% -1.06%

Simon Property Group Retail 2.36% -1.18%

Digital Realty Trust Office 0.00% -1.27%

Ventas Health Care 0.00% -1.73%

Public Storage Storage 0.00% -2.17%

Top

5Bo

ttom

5

Performance Attribution

Stock selection was strong in the North America

Positive North America performance was offset by negative performance in Japan and Australia

stocks

issues


Returns are presented in US Dollars. 12 MonthsEnding 6/30/17.1. RepresentativeGlobalDiversified Developed Strategy.Please read Performance Notes pagesfor important disclosure information.Please read Attribution AnalysisPerformanceNotespagefor important disclosure information.

Global Diversified Developed

North America 57.39 -0.88 -0.91 -0.20 57.14 -2.65 -2.65 -1.22 -0.04 1.34 -0.31 0.99 -0.02 0.97

Cash 0.77 -0.29 -0.29 0.01 0.00 - - 0.00 -0.01 0.00 0.00 -0.01 0.05 0.04

Middle East 0.00 - - 0.00 0.15 33.29 20.78 0.04 -0.02 0.00 0.00 -0.02 -0.02 -0.04

Europe 15.53 8.06 7.25 1.21 15.70 9.15 8.25 1.29 0.03 -0.11 -0.02 -0.11 0.01 -0.10

Asia-Pacific 26.30 1.21 4.81 0.07 27.01 4.67 8.38 1.04 -0.09 -0.71 -0.18 -0.98 0.03 -0.96

Total 100.00 1.08 1.83 1.08 100.00 1.16 1 .96 1.16 -0.13 0.52 -0.52 -0.13 0.05 -0.08

AverageWeight

TotalReturn

TotalEffect

TotalReturn(Local)

ContributionTo Return

AllocationEffect

(Local)

SelectionEffect

(Local)

InteractionEffect

(Local)

TotalEffect

(Local)

TotalCurrency

EffectRegion & Country GroupingAverageWeight

TotalReturn

TotalReturn(Local)

ContributionTo Return

FTSE EPRA/NAREIT Developed Attribution AnalysisPortfolio¹

Top Ten Contributors/Detractors


Portfolio data for Los Angeles Water and Power Employees’ Retirement PlanOne year ended 6/30/17

Top Ten Contributors

Simon Property Group 0.36

Kimco Realty 0.29

CareTrust REIT 0.29

Macerich 0.26

Equinix 0.23

Realty Income 0.21

Brixmor Property Group 0.18

Sunstone Hotel Investors 0.17

AvalonBay Communities 0.16

Pure Industrial Real Estate Trust 0.16

Bottom Ten Detractors

Store Capital -0.4

Retail Properties of America -0.34

Spirit Realty Capital -0.34

Pennsylvania REIT -0.29

Federal Realty Investment Trust -0.28

DDR -0.27

CubeSmart -0.19

Equity Residential -0.17

Taubman Centers -0.14

Japan Retail Fund Investment -0.13


Top Ten Holdings

25Portfolio Review & Characteristics

Security Region Sector Weight

Benchmark

Weight Weight Excess

ProLogis Inc NORTH AMERICA INDUSTRIAL 3.17 2.17 0.99

AvalonBay Communities Inc NORTH AMERICA RESIDENTIAL 2.92 1.86 1.06

HCP Inc NORTH AMERICA HEALTH CARE 2.47 1.06 1.41

GGP NORTH AMERICA RETAIL 2.38 1.02 1.36

Simon Property Group Inc NORTH AMERICA RETAIL 2.36 3.54 -1.18

Sun Hung Kai Properties Ltd ASIA-PACIFIC DIVERSIFIED 2.08 1.47 0.61

Welltower NORTH AMERICA HEALTH CARE 2.07 1.93 0.14

Equity Residential NORTH AMERICA RESIDENTIAL 2.07 1.65 0.42

CubeSmart NORTH AMERICA STORAGE 2.02 0.30 1.71

Cheung Kong Property Holdings ASIA-PACIFIC DIVERSIFIED 1.99 1.50 0.48

Complete List of Holdings

26


Benchmark

Weight

Weight

Excess Market Value

Sun Hung Kai Properties Ltd ASIA DIVERSIFIED 2.08 1.47 0.61 576,919.79

Cheung Kong Property Holdings ASIA DIVERSIFIED 1.99 1.50 0.48 555,903.39

Mitsubishi Estate Co Ltd ASIA DIVERSIFIED 1.95 1.55 0.40 549,236.32

Mitsui Fudosan Co Ltd ASIA DIVERSIFIED 1.83 1.59 0.24 514,987.13

Scentre Group ASIA RETAIL 1.68 1.12 0.56 467,949.31

Link REIT/The ASIA RETAIL 1.33 1.19 0.14 369,215.99

Goodman Group ASIA INDUSTRIAL 0.99 0.75 0.25 280,959.32

Sumitomo Realty & Development ASIA DIVERSIFIED 0.90 0.94 -0.03 259,597.45

City Developments Ltd ASIA DIVERSIFIED 0.86 0.26 0.60 254,228.17

Vicinity Centres ASIA RETAIL 0.89 0.46 0.43 254,211.37

Activia Properties Inc. ASIA DIVERSIFIED 0.85 0.18 0.67 235,203.81

Wharf Holdings Ltd ASIA DIVERSIFIED 0.83 0.71 0.12 230,440.06

Nippon Prologis REIT ASIA INDUSTRIAL 0.80 0.25 0.55 223,718.41

Nippon Building Fund ASIA OFFICE 0.73 0.46 0.28 209,451.76

GPT Group ASIA DIVERSIFIED 0.70 0.47 0.24 202,755.37

Japan Retail Fund Investment C ASIA RETAIL 0.68 0.35 0.33 184,674.26

Hulic REIT Inc. ASIA OFFICE 0.59 0.10 0.49 167,127.98

Japan Hotel REIT ASIA DIVERSIFIED 0.60 0.19 0.42 166,981.13

Hang Lung Properties Ltd ASIA DIVERSIFIED 0.59 0.36 0.24 160,257.48

Kenedix Realty Investment Corp ASIA RESIDENTIAL 0.55 0.13 0.42 154,859.38

Mapletree Industrial Trust ASIA INDUSTRIAL 0.54 0.12 0.42 154,341.43

Frasers Centrepoint Trust ASIA RETAIL 0.53 - 0.53 149,673.33

Swire Properties ASIA DIVERSIFIED 0.48 0.25 0.24 145,825.79

Stockland Australia ASIA DIVERSIFIED 0.49 0.57 -0.09 135,636.96

Sekisui House SI Investment C ASIA DIVERSIFIED 0.45 0.08 0.37 124,343.18

Frasers Logistics & Industrial ASIA INDUSTRIAL 0.42 - 0.42 119,769.91

Westfield Corp ASIA RETAIL 0.40 0.83 -0.43 115,045.49

Global One REIT ASIA OFFICE 0.38 - 0.38 106,359.02

Sino Land Co Ltd ASIA DIVERSIFIED 0.27 0.34 -0.07 96,507.68

Ingenia Communities Group ASIA RESIDENTIAL 0.20 - 0.20 74,111.30

Investa Off ice Fund ASIA OFFICE 0.13 0.13 0.00 37,030.74

Japan Rental Housing Investmen ASIA RESIDENTIAL 0.15 0.08 0.07 36,934.85

Hulic Co. ASIA DIVERSIFIED 0.10 0.26 -0.16 31,073.94

Unibail-Rodamco SE EUROPE RETAIL 1.65 1.76 -0.11 462,807.06

Vonovia EUROPE RESIDENTIAL 1.11 1.31 -0.20 312,967.08

Gecina EUROPE OFFICE 0.94 0.44 0.50 265,059.48

BUWOG AG EUROPE RESIDENTIAL 0.88 0.22 0.66 246,336.93

Land Securities Group PLC EUROPE OFFICE 0.71 0.70 0.01 199,441.21

Tritax Big Box REIT EUROPE INDUSTRIAL 0.64 0.18 0.45 174,696.78

Shaftesbury PLC EUROPE RETAIL 0.58 0.20 0.38 164,055.44

Aedifica EUROPE RESIDENTIAL 0.57 0.11 0.46 161,054.93

Hibernia REIT EUROPE OFFICE 0.54 0.08 0.46 154,001.19

Derwent London PLC EUROPE OFFICE 0.53 0.24 0.28 152,375.58

Swiss Prime Site AG EUROPE OFFICE 0.56 0.45 0.10 152,344.28

British Land Co PLC EUROPE OFFICE 0.55 0.57 -0.02 152,143.23

Merlin Properties Socimi EUROPE DIVERSIFIED 0.54 0.30 0.24 149,796.98

Deutsche Wohnen AG EUROPE RESIDENTIAL 0.54 0.96 -0.42 149,121.16

TAG Immobilien AG EUROPE RESIDENTIAL 0.51 0.16 0.35 144,028.78

Hammerson PLC EUROPE RETAIL 0.50 0.42 0.09 140,495.80

D Carnegie EUROPE RESIDENTIAL 0.49 0.03 0.45 136,079.49

Grainger PLC EUROPE RESIDENTIAL 0.48 0.10 0.38 134,039.46

Alstria Office EUROPE OFFICE 0.45 0.13 0.32 126,574.58

ICADE EUROPE OFFICE 0.44 0.21 0.23 123,146.89

Warehouses De Pauw EUROPE INDUSTRIAL 0.44 0.12 0.32 121,745.95

Hemfosa Fastigheter EUROPE RESIDENTIAL 0.40 0.11 0.29 113,704.82

Primary Health Properties PLC EUROPE HEALTH CARE 0.39 0.06 0.33 106,553.86


Benchmark

Weight

Weight

Excess Market Value

Axiare Patrimonio Socimi EUROPE OFFICE 0.34 0.08 0.27 96,045.53

Hamborner REIT AG EUROPE OFFICE 0.34 0.05 0.28 92,712.22

NSI NV EUROPE DIVERSIFIED 0.32 0.04 0.27 89,120.81

New River REIT EUROPE RETAIL 0.31 0.08 0.23 85,273.73

Segro PLC EUROPE INDUSTRIAL 0.29 0.45 -0.16 77,587.96

Coima Res EUROPE OFFICE 0.19 - 0.19 53,923.01

Selvaag Bolig ASA EUROPE OFFICE 0.19 - 0.19 51,713.58

Inmobiliaria Colonial SA EUROPE OFFICE 0.04 0.16 -0.12 12,310.66

ProLogis Inc NORTH AMERICA INDUSTRIAL 3.17 2.17 0.99 894,553.20

AvalonBay Communities Inc NORTH AMERICA RESIDENTIAL 2.92 1.86 1.06 828,252.70

HCP Inc NORTH AMERICA HEALTH CARE 2.47 1.06 1.41 696,088.80

Simon Property Group Inc NORTH AMERICA RETAIL 2.36 3.54 -1.18 669,362.88

GGP NORTH AMERICA RETAIL 2.38 1.02 1.36 656,499.40

Welltower NORTH AMERICA HEALTH CARE 2.07 1.93 0.14 587,347.95

Equity Residential NORTH AMERICA RESIDENTIAL 2.07 1.65 0.42 586,281.98

CubeSmart NORTH AMERICA STORAGE 2.02 0.30 1.71 574,820.44

Essex Property Trust Inc NORTH AMERICA RESIDENTIAL 1.80 1.18 0.62 511,967.30

National Retail Properties Inc NORTH AMERICA RETAIL 1.72 0.41 1.31 487,577.00

Vornado Realty Trust NORTH AMERICA OFFICE 1.67 1.14 0.53 467,622.00

Extra Space Storage Inc NORTH AMERICA STORAGE 1.48 0.67 0.81 421,044.00

Kilroy Realty Corp NORTH AMERICA OFFICE 1.40 0.51 0.89 409,567.50

First Capital Realty Inc NORTH AMERICA RETAIL 1.41 0.16 1.25 396,356.36

Equinix NORTH AMERICA OFFICE 1.35 - 1.35 388,818.96

Retail Properties of America NORTH AMERICA RETAIL 1.28 0.20 1.08 370,085.10

American Homes 4 Rent NORTH AMERICA RESIDENTIAL 1.28 0.36 0.92 362,790.18

EPR Properties NORTH AMERICA SPECIALTY 1.23 0.32 0.91 359,350.00

DiamondRock Hospitality Co NORTH AMERICA HOTEL/RESORT & ENTERTAINMENT 1.26 0.15 1.10 354,484.35

DCT Industrial Trust Inc NORTH AMERICA INDUSTRIAL 1.23 0.35 0.88 347,894.40

Camden Property Trust NORTH AMERICA RESIDENTIAL 1.18 0.52 0.67 330,068.60

Alexandria Real Estate Equitie NORTH AMERICA OFFICE 1.15 0.76 0.39 327,678.40

Cyrusone NORTH AMERICA OFFICE 1.15 - 1.15 325,022.50

Acadia Realty Trust NORTH AMERICA RETAIL 1.10 0.16 0.94 320,256.00

Physicians Realty Trust NORTH AMERICA HEALTH CARE 1.03 0.22 0.81 292,170.98

Park Hotels & Resorts NORTH AMERICA HOTEL/RESORT & ENTERTAINMENT 0.96 0.24 0.72 268,305.92

CareTrust REIT Inc. NORTH AMERICA HEALTH CARE 0.92 0.09 0.83 259,763.94

Federal Realty Investment Trus NORTH AMERICA RETAIL 0.92 0.64 0.29 259,099.50

Sunstone Hotel Investors Inc NORTH AMERICA HOTEL/RESORT & ENTERTAINMENT 0.90 0.25 0.65 258,613.16

Smart REIT NORTH AMERICA RETAIL 0.88 0.20 0.68 249,055.52

Cousins Properties Inc NORTH AMERICA OFFICE 0.84 0.26 0.59 239,527.50

DDR Corp NORTH AMERICA RETAIL 0.84 0.20 0.64 236,500.25

Taubman Centers Inc NORTH AMERICA RETAIL 0.82 0.25 0.57 224,503.50

Paramount Group NORTH AMERICA OFFICE 0.73 0.22 0.51 199,696.00

Healthcare Trust of America In NORTH AMERICA HEALTH CARE 0.66 0.41 0.25 191,264.28

Rexford Industrial Realty Inc NORTH AMERICA INDUSTRIAL 0.63 0.13 0.50 175,698.32

Brandyw ine Realty Trust NORTH AMERICA OFFICE 0.60 0.21 0.39 170,093.59

New York REIT NORTH AMERICA OFFICE 0.79 - 0.79 168,480.00

Hudson Pacific Properties Inc NORTH AMERICA OFFICE 0.60 0.38 0.23 166,539.49

Boston Properties Inc NORTH AMERICA OFFICE 0.51 1.33 -0.83 144,425.48

Invitation Homes NORTH AMERICA RESIDENTIAL 0.52 0.13 0.39 141,676.50

Pennsylvania Real Estate Inves NORTH AMERICA RETAIL 0.45 0.05 0.40 122,844.64

Summit Hotel Properties Inc NORTH AMERICA HOTEL/RESORT & ENTERTAINMENT 0.45 0.13 0.32 120,161.95

Allied Properties Real Estate NORTH AMERICA OFFICE 0.40 0.18 0.22 113,400.54

Interxion Holding NORTH AMERICA OFFICE 0.43 - 0.43 108,361.26

Pure Industrial Real Estate Tr NORTH AMERICA INDUSTRIAL 0.28 0.10 0.18 72,116.30

Empire State Realty Trust NORTH AMERICA OFFICE 0.04 0.19 -0.14 10,758.86

Cash & Cash Equivalent (main acc.) CASH Cash & Cash Equivalent 0.89 - 0.89 399,637.09

Portfolio Review & Characteristics 26

Change in Market Value Since Inception


Portfolio data for Los Angeles Water and Power Employees’ Retirement PlanAs of 6/30/17

$13.68

$16.48

$20.24

$21.50

$25.68

$26.71

$25.01 $24.72$25.68

$27.22$28.03 $28.35

$26.96$27.48

$28.31

$10.00

$15.00

$20.00

$25.00

$30.00

12/31/2013 6/30/2014 12/31/2014 6/30/2015 12/31/2015 6/30/2016 12/31/2016 6/30/2017

Market Value ($ in milllions)

Comparative Portfolio Metrics

1. Numbers are weighted averages.2. Lesser of 12 month purchases or sales divided by average 12 month market valueAs of June 30, 2017. Inception date for Global Diversified Developed is 12/31/10.

28

FTSE/EPRA NAREITGlobal Diversified Developed

Developed Strategy Benchmark

Implied Cap/EBITDA Yield1 5.53% 5.38%

Premium/Discount to NAV1 -4.40% -2.29%

Dividend Yield1 3.47% 3.87%

1 Year Dividend Growth1 12.34% 10.47%

Beta (Since Inception) 0.99 1.00

# of Names 114 335

Active Share 51.15% N/A

Tracking Error (Since Inception) 0.86% N/A

Cash Position 1.01% N/A

Turnover (Rolling 12-Months)2 143.53% N/A

Portfolio Review & Characteristics 28

Global Diversified Developed – North AmericaAttribution Review – 1 Year

29

Unite d State s -2.81% 95 .09% -2 b p s 149 b p s 147 b p s

Niche 12.12% 4.30% 33 bps 37 bps 70 bps

Industrial 18.44% 7.83% 20 bps 28 bps 48 bps

Hotels/Resort & Entertainment 19.64% 5.76% -2 bps 45 bps 43 bps

Health Care 2.68% 12.75% 0 bps 32 bps 32 bps

Residential 7.23% 16.15% 1 bps 27 bps 28 bps

Self-Storage -16.01% 6.33% 7 bps 19 bps 26 bps

Regional Malls -22.62% 12.01% 18 bps -3 bps 15 bps

Office 4.46% 13.35% -12 bps -7 bps -19 bps

Strip Centers -26.68% 8.11% -23 bps -7 bps -30 bps

Triple Net -10.53% 8.50% 5 bps -70 bps -65 bps

Canada 0.37% 4.91% 2 b p s 29 b p s 30 b p s

Industrial 40.55% 0.33% 21 bps 0 bps 22 bps

Diversified 1.65% 1.60% 1 bps 17 bps 17 bps

Retail -10.25% 1.54% -4 bps 14 bps 11 bps

Hotel/Resort & Entertainment 2.60% 0.01% 0 bps 0 bps 0 bps

Health Care 1.93% 0.27% 0 bps 0 bps 0 bps

Residential 3.29% 0.88% -6 bps -2 bps -9 bps

Office 4.90% 0.28% -9 bps 0 bps -9 bps

Cas h & Cas h Equivale nt - - -11 b p s 0 b p s -11 b p s

Total -2.65 % 100.00% -11 b p s 177 b p s 166 b p s

Property Type¹Relative

Returns Portfolio Effect

Relative Allocation

Contribution3

Selection +

Interaction EffectTotal EffectIndex² Index²

Average Weighting

-0 .38%

1.56%

0.62%

-0.06%

-0.38%

0.17%

-0.17%

-0.60%

-1.06%

0.80%

-1.26%

-0.26%

0.60%

-1.11%

0.84%

-0.01%

-0.27%

-0.70%

0.38%

0.64%

-2% 0% 2%

1.56%

10.02%

3.69%

9.76%

2.81%

1.86%

2.70%

-0.19%

-0.67%

-0.92%

-9.72%

6 .53%

-0.57%

8.45%

5.33%

0.00%

0.00%

-18.11%

-0.11%

0.00%

1.66%

-20% 0% 20%

The Country Returns shown aboveare supplemental information to the Global DiversifiedDeveloped Strategy Composite.1. RepresentativeGlobalDiversified Developed North America Strategy.2. FTSE EPRA/NAREIT Developed North America Index.3. Allocation Contribution includescurrency effect.

Returns are presented in US Dollars. 12 MonthsEnding 6/30/17.Please read Performance Notes pages for important disclosure information.Please read Attribution Analysis Performance Notes page for important disclosure information.

Portfolio Review & Characteristics

Global Diversified Developed – Asia-PacificAttribution Review – 1 Year


Relative Relative

China - - 3 b p s 0 b p s 3 b p s

Investors & REITs - - -3 bps 0 bps -3 bps

Ne w Ze aland 3.63% 0.36% 0 b p s 0 b p s 0 b p s

Investors & REITs 3.63% 0.36% -2 bps 0 bps -2 bps

Cas h & Cas h Equivale nt - - -13 b p s 0 b p s -13 b p s

Cash & Cash Equivalent - - -3 bps 0 bps -3 bps

Singap ore 14.66% 8.5 1% 4 b p s -33 b p s -29 b p s

Property Cos & Dev 23.81% 3.22% -10 bps 2 bps -9 bps

Investors & Reits 9.53% 5.28% -5 bps -18 bps -23 bps

Aus tralia -3.35 % 22.12% 14 b p s -88 b p s -73 b p s

Investors & Reits -3.35% 22.12% 6 bps -88 bps -82 bps

Hong Kong 24.18% 28.5 1% -5 1 b p s -49 b p s -100 b p s

Developers 24.68% 15.92% -7 bps 35 bps 28 bps

Investors & REITs 23.52% 12.58% 11 bps -89 bps -77 bps

Jap an -4.75 % 40.5 1% -2 b p s -138 b p s -140 b p s

Developers 7.23% 17.48% -3 bps -55 bps -59 bps

Investors & Reits -12.89% 23.02% -7 bps -65 bps -72 bps

Total 4.67% 100.00% -45 b p s -307 b p s -35 3 b p s

Returns Average Weighting Portfolio Effect

Property Type¹ Index² Index²Allocation

Contribution3

Selection +

Interaction EffectTotal Effect

0 .00%

0.00%

0 .00%

0.00%

0 .00%

0.00%

-4.30%

-1.90%

-2.46%

-3 .44%

-3.44%

-2 .14%

3.21%

-8.06%

-3 .00%

-2.76%

-2.14%

-3 .5 3%

-10% -5% 0% 5%

0 .35%

0.35 %

-0 .36%

-0.36%

1 .09%

1.09%

-0 .12%

-0.87%

0.75 %

0 .66%

0.66%

-1 .99%

-1.5 1%

-0.48%

0 .36%

-0.33%

0.69%

-4% -2% 0% 2%

The Country Returns shown aboveare supplemental information to the Global DiversifiedDeveloped Strategy Composite.1. RepresentativeGlobalDiversified Developed Asia-Pacific Strategy.2. FTSE EPRA/NAREIT Developed Asia Index.3. Allocation Contribution includescurrency effect.

Returns are presented in US Dollars. 12 MonthsEnding 6/30/17.Please read Performance Notes pages for important disclosure information.Please read Attribution Analysis Performance Notes page for important disclosure information.

Global Diversified Developed – EuropeAttribution Review – 1 Year

31Portfolio Positioning & Performance

Cas h & Cas h Equivale nt - - 25 b p s 0 b p s 25 b p sCash & Cash Equivalent - - -4 bps 0 bps -4 bpsEurop e 10.14% 69.83% -7 b p s -37 b p s -44 b p s

Ne utral 5 .88% 24.12% -11 b p s 86 b p s 75 b p sResidential 14.07% 2.18% 21 bps 21 bps 42 bpsIndustrial 18.32% 0.68% 35 bps -1 bps 34 bpsRetail 0.11% 15.02% 25 bps 5 bps 30 bpsOffice 16.44% 6.24% 2 bps -10 bps -8 bpsDe fe ns ive 10.28% 28.30% -1 b p s -13 b p s -14 b p sRetail -5.45% 2.17% 33 bps 5 bps 39 bpsDiversified 24.92% 0.92% -12 bps 0 bps -12 bpsResidential 14.09% 18.84% 12 bps -25 bps -13 bpsOffice 3.16% 6.38% 11 bps -30 bps -19 bpsCyclical 16.10% 17 .41% -31 b p s -74 b p s -105 b p sResidential 5.88% 2.70% 21 bps 6 bps 27 bpsRetail 16.08% 1.76% 0 bps 0 bps 0 bpsHotel/Resort & Entertainment 17.44% 0.41% -1 bps 0 bps -1 bpsDiversified 26.65% 2.95% -9 bps -16 bps -25 bpsOffice 15.98% 9.58% -20 bps -79 bps -99 bps

Unite d Kingdom 6.95 % 30.17% 6 b p s -68 b p s -62 b p sNe utral 2.78% 21.25 % -6 b p s -11 b p s -17 b p sRetail 4.60% 5.46% -6 bps 20 bps 14 bpsOffice -0.38% 11.35% 2 bps -2 bps 0 bpsDiversified 6.30% 2.82% -1 bps 0 bps -1 bpsResidential 23.26% 0.57% -7 bps -3 bps -10 bpsStorage 7.56% 1.06% 3 bps -20 bps -17 bpsDe fe ns ive 12.34% 4.77% 5 b p s -25 b p s -20 b p sRetail 16.97% 0.25% 9 bps -4 bps 6 bpsIndustrial 16.43% 0.86% -4 bps 2 bps -2 bpsDiversified 18.94% 1.18% -6 bps 0 bps -6 bpsHealth Care 12.31% 1.29% -3 bps -8 bps -11 bpsResidential 4.26% 1.20% -8 bps -11 bps -19 bpsCyclical 22.66% 4.15 % -30 b p s -3 b p s -33 b p sDiversified 13.78% 0.84% 5 bps 0 bps 5 bpsIndustrial 24.30% 2.79% 4 bps -2 bps 2 bpsOffice 29.10% 0.51% 0 bps -1 bps -1 bps

Total 9.15 % 100.00% 24 b p s -104 b p s -81 b p s

Selection +

Interaction EffectTotal Effect

Returns Average Weighting Portfolio Effect

Allocation

Contribution3Property Type¹ Index²Relative

Index²Relative

0 .00%0.00%

-0 .71%3 .1 7%

23.72%-8.36%

0.29%-2.81%-0 .37%

5 .19%0.00%

-1.67%-6.17%-5 .82%

-1.19%0.00%0.00%

-14.16%-6.90%

-2 .25%-0 .44%

2.78%-0.23%

0.00%-26.86%

-6.97%-4.10%-2.83%

0.83%0.00%

-3.84%-15 .05 %

-1 .96%-12.06%-11.43%

-21.28%-0 .81%

-40 % -20% 0% 20% 40%

0 .69%0.69%

-0.26%3 .97%

1.35 %1.82%

-1.05 %1.85 %

-3 .67%-1.26%-0.92%

-0.11%-1.38%

-0 .5 6%-2.5 1%

-1.76%-0.41%

-0.70%4.83%

-0 .43%0 .5 4%

2.32%0.28%

-2.82%-0.38%

1.14%1 .5 3%

0.22%1.47%

-1.18%0.79%

0.22%-2 .5 0%

-0.83%-2.02%

0.35 %

-5% 0% 5% 10%

The Country Returns shown aboveare supplemental information to the Global DiversifiedDeveloped Strategy Composite.

1. RepresentativeGlobalDiversified Developed EuropeStrategy.2. FTSE EPRA/NAREIT Developed Europe Index.3. Allocation Contribution includescurrency effect.

Returns are presented in US Dollars. 12 MonthsEnding 6/31017.Please read Performance Notes pages for important disclosure information.Please read Attribution Analysis Performance Notes page for important disclosure information.


Heitman Key Differentiators

True bottom-up approach with local and integrated teams

An investment process that goes beyond valuation

Disciplined oversight, dedicated risk management

Employee ownership drives actions and aligns our interest with yours

33Conclusion


WPERP Fee Schedule

35Appendix: Fee Schedule

62.5 bps per annumon the average of the month end market values,

as computed by the custodian


Common REIT Terms

Cash Available for Distribution (CAD): CAD is calculated by subtracting from Funds from Operations (FFO)both (1) normalized recurring expenditures that are capitalized by the REIT and then amortized, but which arenecessary to maintain a REIT's properties and its revenue stream (e.g., new carpeting and drapes in apartmentunits, leasing expenses and tenant improvement allowances) and (2) "straight-lining" of rents.

Capitalization Rate: The capitalization rate (or "cap" rate) for a property is determined by dividing theproperty's net operating income by its purchase price. Generally, high cap rates indicate higher returns andgreater perceived risk.

Funds From Operations (FFO): The most commonly accepted and reported measure of REIT operatingperformance. Equal to a REIT's net income, excluding gains or losses from sales of property, and adding backreal estate depreciation.

Mortgage REIT: A REIT that makes or owns loans and other obligations that are secured by real estatecollateral.

Multiple to Growth: This is a common valuation measure that is calculated by dividing a REIT’s following yearPrice/FFO multiple by its FFO growth rate plus dividend yield and then dividing by 100.

Net Asset Value (NAV): The net "market value" of all a company's assets, including but not limited to itsproperties, after subtracting all its liabilities and obligations.

Straight-lining: Real estate companies such as REITs "straight line" rents because generally acceptedaccounting principles require it. Straight lining averages the tenant's rent payments over the life of the lease.

Payout Ratio: This is a measure of the security of a company’s dividend and is calculated by dividing a REITsCAD by its dividend.

37Appendix: Glossary of Investment Terms


Presenters

Jerry Ehlinger, CFA is Managing Director and the Lead Portfolio Manager in Heitman's North American Public Real Estate Securities group. He alsoserves on the group’s Global Investment Committee and co-manages the group’s global real estate securities strategies. He is an equity owner ofthe firm. Throughout his career, Jerry has held a number of related investment positions in the REIT industry. Before joining Heitman in 2013, Jerrywas Lead Portfolio Manager and Head of Real Estate Securities, Americas at DB/RREEF Real Estate. Prior, Jerry served as Senior Vice President andPortfolio Manager of Heitman's real estate securities group from 2000 to 2004. He began his career at Morgan Stanley in 1996 where he primarilycovered the REIT sector both as a sell-side analyst and as a senior research associate at Morgan Stanley Asset Management. Jerry received an MS inFinance, Investment and Banking from the University of Wisconsin-Madison and a BS in Finance from the University of Wisconsin-Whitewater.Among other professional affiliations, Jerry is a member of the NAREIT Real Estate Investment Advisory Council, National Multi Housing Council,International Council of Shopping Centers, the CFA Institute, and the CFA Society of Chicago.

John Mancuso is a Senior Vice President in Heitman’s Client Service & Marketing group. He is responsible for developing and maintainingrelationships with institutional investors in the western region of the US in private real estate equity, public securities, and private real estate debt.Prior to joining Heitman, John was the head of private markets research at Russell Investments. He was responsible for overseeing Russell’s privatemarkets investment research practice on a global basis by setting research priorities, identifying strategies for inclusion in client portfolios, andmanaging the due diligence process. Previously, John was with Meketa Investment Group, where he was responsible for supporting several clientrelationships and coordinating the research and due diligence process for real estate investments. John began his career at Lucent Technologies,working in several accounting and finance roles across the business. John received a BS in Finance from Boston College and an MS in Managementfrom the F.W. Olin School of Business at Babson College. He is a member of the Pension Real Estate Association, CFA Institute and the CFA Societyof Colorado.

39Appendix: Biographies


1. Heitman Real Estate Securities LLC (“HRES”) is an investment adviser specializing in the investment of equity, convertible and debt instruments of North American publicly traded real estate related companies (REITs – real estateinvestment trusts and REOCs – real estate operating companies). Heitman International Real Estate Securities GmbH (“HIRES”) is an investment adviser specializing in the investment of equity, convertible and debt instruments ofEuropean publicly traded real estate related companies. Heitman International Real Estate Securities HK Limited (“HIRES HK”) is an investment adviser specializing in the investment of equity, convertible and debt instruments of Asia /Pacific publicly traded real estate related companies Heitman International Real Estate Securities Pty Limited (“HIRES PTY”) is an investment adviser specializing in the investment of equity, convertible and debt instruments of Asia /Pacific publicly traded real estate related companies. HRES, HIRES and HIRES PTY HIRES HK (collectively, “Company”) are limited liability companies whose sole member is Heitman LLC. The members of Heitman are: (i) OMAM (HFL), Inc., asubsidiary of OM Asset Management plc, which is an affiliate of Old Mutual plc and (ii) a group of key Heitman employees.

2. This composite includes all discretionary, global diversified strategy clients benchmarked to the FTSE EPRA/NAREIT Developed Index.

3. The Company claims compliance with Global Investment Performance Standards (GIPS®) and has prepared and presented this report in compliance with GIPS standards. The Company has been independently verified for the periods ofJanuary 1, 1993 through December 31, 2015. Verification assesses whether (1) the firm has complied with all the composite construction requirements of the GIPS standards on a firm-wide basis and (2) the firm’s policies and procedures aredesigned to calculate and present performance in compliance with the GIPS standards. The verification does not ensure the accuracy of any composite presentation.

4. Trade date settlement valuation is used and dividends are recorded on “ex-date” for this composite. This composite is denominated in US dollars.

5. The FTSE EPRA/NAREIT Developed Index is a market cap weighted index of publicly traded REITs and REOCS from around the world. The Indices are presented for illustrative purposes only and are not intended to imply Heitman’s past orfuture performance. The performance of the Indices assumes dividend reinvestment, but do not reflect transaction costs, advisory fees, custodian fees, trading costs and other costs of investment. Individuals cannot directly invest in theindices described above.

6. Accounts are included in this composite the first full month under management. Terminated accounts are included in this composite through completion of their last full month under management. This composite was created in January2011.

7. Representative fee schedule is as follows: first $75 million – 0.65%; over $75 million to $200 million – 0.60%; over $200 million to $500 million – 0.55%; over $500 million – 0.50%. Advisory fees are described in Part II of Form ADV (copyavailable upon request).

8. Performance results presented gross and net of management fees. Gross of fees performance is presented before management fees, but after all relevant trading expenses and all applicable non reclaimable withholding taxes. Net of Feesperformance is presented after management fees and any performance fees, all relevant trading expenses and other expenses that may be incurred in the management of an account and all applicable non reclaimable withholding taxes.Composite descriptions, policies for calculating performance, preparing compliant presentations, and valuing portfolios are available upon request. Past performance is no guarantee of future results. Advisory fees are described in Part II ofForm ADV (available upon request).

Global Diversified Developed Strategy

41Appendix: Performance Notes & Disclaimer

Three Year

Three Year Annualized ex-post

Total Return Total Return FTSE EPRA/NAREIT Total Composite Assets Total Firm Assets Percentage Annualized ex-post Standard Deviation

Net of Fees Gross of Fees Developed Index Number of Standard at End of Period at End of Period of Firm Standard Deviation FTSE EPRA/NAREIT

Year (percent) (percent) (percent) Portfolios Deviation ($millions) ($millions) Assets Composite Developed Index

2011 -2.88 -2.65 -5.82 less than 5 N/A 123 2,398 5.13 N/A N/A2012 28.07 28.38 28.65 less than 5 N/A 218 2,440 8.93 N/A N/A2013 4.69 4.96 4.39 less than 5 N/A 214 2,176 9.83 N/A N/A2014 17.89 18.26 15.89 less than 5 N/A 247 3,217 7.68 12.42 12.482015 0.91 1.23 0.05 less than 5 N/A 235 3,371 6.97 12.3 12.27

Attribution Analysis

1. The results are gross of fees and calculated based on transactions. Theresults may vary slightly from the actual returns due to rounding, intra-daytrading and fees.

2. Please note that the portfolio’s performance as represented in this file ispreliminary and may vary from the official result.

3. Attribution analysis are performed on a representative account in a strategyand not on the entire constituents of a strategy’s composite. Therefore,there may be a disparity between the returns calculated through theattribution analysis for a representative account and a composite.

42Appendix: Performance Notes & Disclaimer

IMPORTANT NOTICE AND DISCLAIMER− This confidential presentation and the information set out herein (the “Presentation”) is summary in nature only and is qualified in its entirety by the information

set out in the confidential private placement memorandum or other formal disclosure document (the “Disclosure Document”) relating to the potentialopportunity described herein (the “Opportunity”).

− This Presentation has been provided to the recipient by Heitman or an affiliate as sponsor (the “Sponsor”) and is only intended to assist sophisticatedprofessional investors in deciding whether they wish to consider reviewing the Disclosure Document. This Presentation is meant for use in one-on-onepresentations with sophisticated professional investors. However, the contents of this Presentation are not to be construed as investment, legal or tax adviceand do not consider the particular circumstances specific to any individual recipient to whom this Presentation has been delivered. The recipient should obtainadvice from the appropriate qualified experts. Further, the Sponsor is not acting in the capacity of a fiduciary of any recipient of this Presentation.

− This Presentation is furnished on a strictly confidential basis to sophisticated professional investors. None of the information contained herein may bereproduced or passed to any person or used for any purpose other than for the purpose of considering the Opportunity. No approach of any kind may be madeby any officer, employee or adviser of the recipient of this Presentation to any officer, employee, customer or supplier of the Sponsor without the prior writtenapproval of the Sponsor. Notwithstanding the foregoing, recipients (and each employee, agent or representative of any recipient) may disclose to any and allpersons, without limitation of any kind, the tax treatment and tax structure of an investment described herein and all materials of any kind (including opinions orother tax analyses) that are provided that relate to such tax treatment or tax structure, except to the extent maintaining such confidentiality is necessary tocomply with any applicable securities laws. The foregoing language is not intended to waive any confidentiality obligations otherwise applicable, except withrespect to the information and materials specifically referenced in the preceding sentence. By accepting delivery of this Presentation, each prospective investoragrees to the foregoing.

− Any opinions, forecasts, projections or other statements, other than statements of historical fact, that are made in this Presentation are forward-lookingstatements. Although the Sponsor believes that the expectations reflected in such forward-looking statements are reasonable, they do involve a number ofassumptions, risks and uncertainties. Accordingly, neither the Sponsor nor any of its affiliates makes any express or implied representation or warranty, and noresponsibility is accepted with respect to the adequacy, accuracy, completeness or reasonableness of the facts, opinions, estimates, forecasts, or otherinformation set out in this Presentation or any further information, written or oral notice, or other document at any time supplied in connection with thisPresentation, and nothing contained herein or in the Disclosure Document shall be relied upon as a promise or representation regarding any future events orperformance. Past returns from investment in real estate (or real estate related investments) are no guarantee that the same (or enhanced) returns fromreal estate (or real estate related investments) will be achieved in the future.

− The recipient’s attention is specifically drawn to the risk factors identified by the Sponsor relating to the Opportunity as set out in the Disclosure Document orany other documents provided to the recipient. The Sponsor also advises that the potential investment described herein is speculative, involves a degree of riskand there is no guarantee of performance or a return of any capital with respect to any investment.

− By accepting delivery of this Presentation, the recipient accepts the terms of this notice and agrees, upon request, to return all materials received by therecipient from the Sponsor, including this Presentation without retaining any copies thereof.

Notice and Disclaimer

Appendix: Performance Notes & Disclaimer 43

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