Q4 2016
INVESTOR UPDATE
March 02, 2017
1
DISCLAIMER
This presentation provides a summary description of Northwest Healthcare Properties Real Estate Investment Trust (“NWH” or the “REIT”). This presentation should be read in conjunction with and is qualified in its entirety by reference to the REIT’s most recently filed financial statements, management’s discussion and analysis, management information circular (the “Circular”) and annual information form (the “AIF”). This presentation contains forward-looking statements. These statements generally can be identified by the use of words such as “expect”, “anticipate”, “believe”, “foresee”, “could”, “estimate”, “goal”, “intend”, “plan”, “seek”, “strive”, “will”, “may”, “would”, “might”, “potential”, “should”, “stabilized”, “contracted”, “guidance”, “normalized”, or “run rate” or variations of such words and phrases. Examples of such statements in this presentation may include statements concerning: (i) the REIT’s financial position and future performance, including, normalized financial results, in-place and contracted run rates, payout ratios and other metrics; (ii) the REIT’s property portfolio, cash flow and growth prospects, (iii) liquidity, leverage ratios, future refinancings, fees earned by the asset manager to Vital Trust, anticipated capital expenditures, future general and administrative expenses, including estimated synergies and contracted acquisition and development opportunities, and (iv) the REIT’s intention and ability to distribute available cash to security holders. Such forward-looking information reflects current beliefs of the REIT and is based on information currently available to the REIT. Other unknown or unpredictable factors could also have material adverse effects on future results, performance or achievements of the REIT. Forward-looking information involves significant risks and uncertainties should not be read as a guarantee of future performance or results and will not necessarily be an accurate indication of whether or not, or the times at which, or by which, such performance or results will be achieved, and readers are cautioned not to place undue reliance on such forward-looking statements. The forward-looking statements contained in this presentation are based on numerous assumptions which may prove incorrect and which could cause actual results or events to differ materially from the forward-looking statements. Although these forward-looking statements are based upon what the REIT believes are reasonable assumptions, the REIT cannot assure investors that actual results will be consistent with this forward-looking information. Such assumptions include, but are not limited to, the assumptions set forth in this presentation, as well as assumptions relating to (i) the REIT successfully realizing the operational and financial benefits described herein, including the realization of synergies, completion of anticipated acquisition and development opportunities, and generation of cash flow; and (ii) general economic and market factors, including exchange rates, local real estate conditions, interest rates and the availability of equity and debt financing to the REIT. These forward-looking statements may be affected by risks and uncertainties in the business of the REIT and market conditions, including that the assumptions upon which the forward-looking statements in this presentation may be incorrect in whole or in part, as well as risks related to increases or decreases in the prices of real estate; currency risk; project development, expansion targets and operational delays; marketability; additional funding requirements; governmental regulations, licenses and permits; environmental regulation and liability; competition; uninsured risks; contingent liabilities and guarantees, including the outcome of pending litigation; litigation; health and safety; trustees’ and officers’ conflicts of interest; the ability of the REIT to integrate the operations of NWI; the ability of the REIT to continue to develop and grow; and management of the REIT’s success in anticipating and managing the foregoing factors, as well as the risks described in the Circular and the AIF. The reader is cautioned that the foregoing list of factors is not exhaustive of the factors that may affect forward-looking statements. Other risks and uncertainties not presently known to the REIT or that the REIT presently believes are not material could also cause actual results or events to differ materially from those expressed in its forward-looking statements. Additional information on these and other factors that could affect the operations or financial results of the REIT are included in reports filed by the REIT with applicable securities regulatory authorities. These forward-looking statements, which reflect the REIT’s expectations only as of the date of this presentation. The REIT disclaims any obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. Certain information concerning Vital Trust contained in this presentation has been taken from, or is based upon, publicly available documents and records on file with regulatory bodies. Although the REIT has no knowledge that would indicate that any of such information is untrue or incomplete, the REIT was not involved in the preparation of any such publicly available documents and neither the REIT, nor any of their officers or trustees, assumes any responsibility for the accuracy or completeness of such information or the failure by Vital Trust to disclose events which may have occurred or may affect the completeness or accuracy of such information but which are unknown to the REIT. Funds from operations (“FFO”), adjusted funds from operations (“AFFO”), net operating income (“NOI”) and net asset value (“NAV”) are not measures recognized under International Financial Reporting Standards (“IFRS”) and do not have standardized meanings prescribed by IFRS. FFO, AFFO, NOI, and NAV are supplemental measures of a real estate investment trust’s performance and the REIT believes that FFO, AFFO, NOI, and NAV are relevant measures of its ability to earn and distribute cash returns to unitholders. The IFRS measurement most directly comparable to FFO, AFFO and NOI is net income. The IFRS measurement most directly comparable to NAV is net equity. A reconciliation of NOI, FFO and AFFO to net income is presented in the REIT’s management’s discussion and analysis of financial condition and results of operations of the REIT for the period ended December 31, 2016, as filed on SEDAR and a reconciliation of NAV is presented herein.
2 2
NWH AT A GLANCE
9.5M 141 $3.9BN SQUARE FEET (3)
PROPERTIES (3)
TOTAL ASSETS (3)
95.6% 11.1 OCCUPANCY YEAR WALE
$1.0BN 7.8% MARKET CAP (1)
DISTRIBUTION YIELD (1)
ESTABLISHED RELATIONSHIPS WITH LEADING HEALTHCARE OPERATORS
7.1% IFRS CAP RATE
87.0% PAYOUT RATIO (2)
NorthWest Healthcare Properties Real
Estate Investment Trust (TSX: NWH.UN) is a
specialist healthcare real estate investor that
owns a high quality portfolio of medical
office and hospital properties located
throughout major markets in Canada, Brazil,
Germany, Australia and New Zealand.
CORE HEALTHCARE INFRASTRUCTURE IN MAJOR MARKETS
T O R O N T O
SÃO PAULO
B E R L I N S Y D N E Y MELBOURNE
ASSET MIX REGIONS
2015
2016
2015
2016 NOI
DIVERSIFICATION (4)
A U C K L A N D
3
As Reported
$0.87/unit
41.5% / 51.5%
$11.66/unit
AFFO/unit (5)
LTV (6)
NAV (7)
Deliver stable property operating performance, cash flow and distributions
Normalized
$0.92/unit
$12.10 /unit
Adjusts for un-deployed cash from $86M equity and convert financing, other financing activities, Santa Helena acquisition, Q4-16 non-recurring items and currency
Occupancy /
WALE
39.5% / 49.3%
95.6%
11.1years
95.6%
11.1 years
Q4 2016 – KEY METRICS
Q4 2016
REIT delivered strong operational, financial and portfolio results in 2016
Target
$0.90 to $0.95/unit
~$11.00/unit
12 – 18 month target Renewed emphasis on capital
allocation – target 50% International asset mix
~96.0%
~10.5 years
~50.0%
Q4 2015
Run Rate
$0.95/unit
~$12.50/unit
Track to management run rate and guidance
<40% / <50%
96%
11 years
4
TRANSFORMATIONAL GROWTH CONTINUES
Improved
Market Profile Defensive High
Quality Portfolio
Positioned for
Growth
Core Healthcare Focus
Major Global Markets
Asset & Capital Diversification
Improved Portfolio Metrics
Increase in Market cap.
Reduced Payout Ratio
Reduced Leverage
Increased NAV
Aligned & Integrated Global Platform
Leverage Institutional Relationships
Identified Expansions and Developments
Actionable Acquisition Pipeline
Strategic International Growth
Operational Strength
Scalable Platform
Defensive Healthcare Assets
Internal value creation opportunities
Canadian Medical Office Building (MOB) Consolidation NWI investment and
international growth
5
$0.92
$572m $2,700m
~7x increase since inception(8) 15% increase since inception(8)
International portfolio above 98% Long-term stability
At inception (3) FY2015
At inception(3) Q4-2015 At inception(3) Q4-2015
At inception(3) Q4-2015 Q4-2016 Normalized
$3,866m
$0.80 $0.82
94.3% 90.7%
10.0 4.0
DASHBOARD
GROSS BOOK VALUE (3) NORMALIZED AFFO / UNIT
WEIGHTED AVERAGE LEASE EXPIRY OCCUPANCY
Q4-2016 Normalized
Q4-2016 Normalized
Q4-2016 Normalized
95.6% 11.1
6
GROSS BOOK VALUE (3) PORTFOLIO QUALITY
SP NOI (9)
FINANCIAL AND OPERATIONAL METRICS
NAV (7)
Normalized NAV has increased from $10.71 to $12.10 per unit
Portfolio Quality improved - occupancy up from ~94% to
~96% with longer lease terms from ~9 years to ~11 years
GBV has increased from $2.7BN to $3.9BN, a ~44% increase
SP NOI increased to 7% in Q4-16 vs. Q4-15
7
Consolidated LTV (Excl. Converts) has decreased from ~49%
(Q4-15) to ~40% (Q4-16 Normalized)
FINANCIAL PROFILE CAPITALIZATION
CAPITAL RAISE
Annualized AFFO / Unit has increased from $0.82 to $0.87.
Payout Ratio has reduced from ~98% to 92%.
FINANCIAL AND OPERATIONAL METRICS
Total capital issuance of ~$453M; $306M in NWH; $147M in
Vital
CAPITAL MARKETS AND LIQUIDITY
453
8
2016 - $350M OF STRATEGIC INTERNATIONAL ACQUISITIONS
July 2016
GHM closed on June 27,
2016 for A$58.5M
Acquired 19.9% of GHC REIT
at A$2.20/unit for a total
investment of $C92M
(A$95.5M) during Q3/16.
Dec. 2016 entered forward
contract to increase interest
to 22.9% (+3.0%.)
June to December 2016
Rede D'Or Investment (1)
– Hospital Ifor in Sao
Paulo for C$26M (R$65M)
at a ~10.75% cap rate
Long-term quadruple net
lease for 25 years and
indexation to inflation
Continued Rede D'Or
Investment (2) - Santa
Helena in Brasilia for
$127M at a ~9.5% cap
rate closed in Q4/16
Long-term quadruple net
lease for 25 years and
indexation to inflation
October 2016
Germany Australia Brazil (1) Vital Trust Brazil (2) Total
Size (C$M) ~$20.0 ~$150.0 ~$25.0 ~$35.0 ~$125.0 ~$350.0
GLA (Square Feet) 0.1 1.1 0.1 - 0.4 ~1.7
Cap Rate ~7.0% ~7.6% ~10.75% ~7.2% ~9.5% ~8.4%
Occupancy ~97.3% ~98.6% 100.0% 99.4% 100.0% ~99.0%
WALE (yrs) ~4.0 ~12.4 ~25.0 ~18.1 ~25.0 ~15.6
Vital Rights Offering for
NZ$160M – NorthWest
participated in its pro rata
share of NZ$40M
Rights price at NZ$2.08,
price before offering
closing of NZ$2.22
July 2016
Acquisition of a
Medical Office
Building complex
consisting of 2
buildings in Berlin
for EUR$13.5M.
April 2016
9 9
F I N A NCI A L O V E RV I E W
10
FINANCIAL HIGHLIGHTS
POSITIVE FINANCIAL
OPERATING RESULTS IN
LINE WITH
MANAGEMENT
GUIDANCE
NORMALIZED RESULTS
HAVE BEEN ADJUSTED
TO REFLECT THE
IMPACT OF RECENTLY
COMPLETED
TRANSACTIONS
NORMALIZATION ADJUSTMENTS
Normalization adjustments principally relate to:
- Acquisition of the Brazil Hospital Santa Helena, which closed in October 2016
- Public offering of 8,544,500 trust units (C$ 86.3M) in January 2017
- Acquisition of 2 properties in Germany (Q1 2017) part funded with proceeds of January offering
- Financing transactions completed in the quarter: Caxias financing and C$ 80.5M of convert offering
- Repayment of higher cost facilities with proceeds of convert offering and January equity
- Accrued rent to 2017 based on contract rental indexation adjustments in Brazil
- Removal of lease termination income occurred in the quarter
- Other non-recurring items that will not have an on-going impact in future quarters.
Q4-16
As Reported
Q4-16
Normalized
NOI $63.6M $52.6M
FFO $21.4M $24.5M
AFFO $19.2M $22.3M
W.A Units
Outstanding 86,367 96,980
AFFO / Unit (4) $0.22/unit $0.23/unit
Payout Ratio 92.0% 87.0%
LTV (5) 41.5% / 51.5% 39.5% / 49.3%
NAV / Unit (6) $11.66/unit $12.10/unit
11
REGIONAL DASHBOARD
C A N A D A B R A Z I L
A U S T R A L A S I A G E R M A N Y
LEADING MEDICAL
OFFICE BUILDING
PLATFORM
CONSOLIDATION OF
MEDICAL OFFICE
BUILDINGS
STRONG
RELATIONSHIPS WITH
LEADING OPERATORS 0.2% SP NOI Growth (9)
91.6% Occupancy
4.8YR WALE
LEADING PUBLICLY
LISTED HEALTHCARE
TRUSTS 1.2% SP NOI Growth (9)
95.4% Occupancy
4.7YR WALE
SP NOI Growth (9)
100% Occupancy
21.7YR WALE
12.5% SP NOI Growth (9)
98.6% Occupancy
15.7YR WALE
10.6%
12
SEGMENTED FINANCIAL INFORMATION (10)
Canada Brazil Germany Vital Vital
Mgr. GHC
Generation
Mgr. (13)
Corporate Combined
NORMALIZED INCOME SUMMARY:
NOI $18.6 $13.1 $3.4 $17.5 - - - - $52.6
FFO $12.9 $9.9 $1.8 $2.8 $1.9 $0.9 $2.0
($7.7) $24.5
AFFO $9.9 $10.8 $1.7 $2.8 $2.1 $0.9 $1.7 ($7.7) $22.3
NORMALIZED BALANCE SHEET SUMMARY:
Gross Assets $1,220 $651 $221 $1,005 $49 $95 $65 $54 $3,361
Total Liabilities (7) $701 $155 $113 $318 $3 - $1
$486 $1,778
Unitholders' Equity $518 $496 $108 $201 $59 $95 $64 ($432) $1,111
13
CAPITALIZATION
DEBT MATURITY PROFILE (11)
Market
Capitalization
Long-Term Debt ObligationsCanada Mortgages$632.04.84.6%German Mortgages$75.6--2.3%Convertible Debentures - NWI$71.94.77.1%Convertible Debentures - NWH$40.95.85.3%FCC Acquisition Facility$23.02.08.2%Near Term Debt ObligationsBrazil Term Loans$176.31.07.3%Margin Facilities$71.21.27.2%Revolving Credit Facilities$15.81.2BA+2.00%Deferred Consideration$41.3On Demand--
$1.0BN
Enterprise Value $2.7BN
Gross Book
Value
LTV
(Excluding
Convertibles) 41.5%
LTV
(Including
Convertibles) 51.5%
W.A. Interest
Rate 4.39%
% Unsecured
Debt 19.4%
% Fixed Debt 81.6%
REGIONAL DEBT STRATEGIES
Type Asset Level
Term Debt
Bank Loans and
Securitization
Asset Level
Term Debt
Asset Level
Revolving Debt
LTV (13) ~56% ~25% ~48% ~36%
Market Interest
Rates (14) ~3.9% ~7.8% ~1.9% ~5.1%
Typical
Amortization 25 years 10 years 50 years Interest Only
$3.9BN
14
QUARTERLY NAV/UNIT IMPACT
International Growth
- Canada: gain driven by recgnition density value at REIT`s Dundas -Edward Centre property in Toronto, partially offset by a valuation decrease at Glenmore Professional Centre property in Calgary, Alberta.
- Brazil: cap rate compression of 73 bp QoQ to 8.52% supported by positive macro-economic changes in Brazil and credit quality of Rede D`Or. NOI increases due to annual indexed leases based on three months of inflation.
- Germany: continued cap rate compression to 5.86% as demand for German real estate remains supported by institutional investors. NOI increases due to rent growth.
- Australasia:. Demand for healthcare properties continues to be strong with Vital Trust cap rates compressing 18 bps QoQ to 6.86%.
In Millions Canada Brazil Germany Australasia Total
Value Attributable To:
NOI changes 6.3 6.0 $4.2 $0.2 $16.7
Implied cap rate
changes 3.7 53.0 $1.9 $1.1 $59.7
Total $10.0 $59.0 $6.1 $1.4 $76.5
Per Unit $0.11 $0.67 $0.07 $0.02 $0.86
15
RISK MANAGEMENT – FOREIGN EXCHANGE
POSITIVE CURRENCY
ENVIRONMENT
RENTAL INDEXATION
ACTS AS NATURAL
CURRENCY HEDGE
LOCAL CURRENCY
PROPERTY /
CORPORATE DEBT TO
REDUCE INVESTMENT
RISK
OVER A 10 YEAR
PERIOD, PORTFOLIO
INDEX HAS REMAINED
RELATIVELY IN-LINE
WITH ITS BASE VALUE
F/X rates up 3.3% YTD in 2017
Var. %
Dec 31-216 9-Feb-17 Dec 31-216
BRL:CAD 0.413 0.429 3.7%
EUR:CAD 1.415 1.406 -0.7%
NZD:CAD 0.933 0.952 2.0%
AUD:CAD 0.969 1.021 5.3%
Portfolio weighted average 3.3%
FX Rate
16 16
PORTFOLIO OVERVIEW
17
BRAZIL
7 Hospitals /~1.187 Beds
2 Tenants
S&P Rated Tenant
CANADA
58 Medical Office Buildings
1,102 tenants
VITAL PROPERTY TRUST
GERMANY
New Zealand Listed Entity
38 Properties
6 Contracted Developments
22 Medical Office Buildings
465 Tenants
1 Development Site
PORTFOLIO OVERVIEW
$3.9BN International Platform Canada / Brazil / Germany / Australia & NZ
Berlin
São Paulo
Toronto
Melbourne
Auckland
GENERATION
HEALTHCARE
Australian Listed Entity
16 Properties
3 Contracted Developments
Insert GHC logo
18
Tenant Region % of Gross
Rent
Rede D`Or 19.5%
Healthscope 6.0%
Healthe Care 3.5%
Bantrel Co. 2.6%
CISSS/CIUSSS 2.5%
Hospital Sabara 1.8%
Winnipeg Regional Health
Authority 1.2%
Alberta Health Services 1.2%
Lawtons Drug Stores Limited 1.1%
Shoppers Realty Inc. 1.0%
Top 10 Tenants 40.4%
PORTFOLIO DIVERSIFICATION
DIVERSIFIED
PORTFOLIO IN
STRATEGIC
INTERNATIONAL
MARKETS AND STABLE,
CORE HEALTHCARE
REAL ESTATE ASSET
CLASSES
DIVERSIFIED TENANT
BASE WITH STRATEGIC
PARTNERSHIPS WITH
LEADING HEALTHCARE
OPERATORS IN LOCAL
MARKETS
TOP 10 TENANTS BY GROSS RENT (12)
1
2
3
6
7
8
9
10
4
5
NOI DIVERSIFICATION
BY GEOGRAPHY (4)
NOI DIVERSIFICATION
BY ASSET MIX (4)
REGIONS
2015
2016
ASSET MIX
2015
2016
19
Assets MOB - development
Size 82k Square Feet
Tenants Etobicoke Family Health
Team
Cap Rate (23) ~6.0%
Occ. ~90%
Lease Term ~16 Years
Rental
Increase Contract Rents
Acquisition
Date Completed Q3/16
Assets 2 Hospitals
Size 294 Beds + 22 surgical units/
~475k Square Feet
Tenants
Hospital Operator Rede D’Or
S.L.
Fitch ‘AA+(bra)’ rated
Cap Rate (23) ~9.7%
Occ. 100%
Lease Term ~25 Years
Rental
Increase Annual Inflation Index
Acquisition
Date Q3/Q4-2016
Assets 1 MOB
Size 31k square feet
Tenants
Castlereagh Imaging (Sonic
Healthcare), NSW Health
Sydney Children’s Hospital
Cap Rate (23) ~6.7%
Occ. 100%
Lease Term ~5.9 Years
Rental
Increase Annual Inflation Index
Acquisition
Date September 2016
Assets 1 MOB
Size ~60k Square Feet
Tenants ~17 Medical Practitioners
& Related Services
Cap Rate (23) ~6.2%
Occ. ~93%
Lease Term ~6.8 Years
Rental
Increase Annual Inflation Index
Acquisition
Date Q1 2017
REPRESENTATIVE INVESTMENTS
Rede D’Or Hospital Portfolio
Alte Holstenstrasse, Hamburg
Mons Road Medical Centre
Toronto West Health Centre
IFOR and Santa
Helena
20
~$225M of committed low risk development & expansions – $173M Australian hospital expansions to be funded through existing resources
– $55.4M Brazil hospital expansions to be funded through a combination of existing resources and property financing
~$20M of stabilized net operating income – Potential to generate up to an incremental ~$0.03 of AFFO/Unit
~$64M of stabilized value accretion – Potential to generate up to an incremental ~$0.13 of NAV/Unit (on a proportionate basis)
Substantial Completion of Barrie Primary Care Campus, Barrie, ON – Q4-2016 – ~80k square foot medical office building complex
ACCRETIVE DEVELOPMENT & EXPANSIONS
WITH A TRACK
RECORD OF
COMPLETING MORE
THAN $325M OF
DEVELOPMENTS AND
EXPANSIONS, THE
REIT IS LEVERAGING
ITS EXPERIENCE TO
DELIVER AN
ADDITIONAL $225M
OF INCOME AND
VALUE ENHANCING
PROJECTS TO ITS
PORTFOLIO
Country (15) Projects Est.
Completion
Project
Cost
Cost to
Complete
Pre-Leased
Occupancy Project
Yield
Project
NOI
Potential
Value
Accretion
8 Q2 2017 to
Q3 2019 173.0 116.8 100.0% ~8.0% 14.1 55.7
2 Q4 2017 /
Q4 2018 55.4 55.4 100.0% 10.5% 5.8 8.1
10 228.4 172.2 19.9 63.8
21
Projects consist of major expansions to add a combination of inpatient beds, operating
theaters, and parking to existing facilities
Developments are 100% pre-leased to the existing operators of these facilities under
long-term inflation indexed leases
Weighted average development yield of 8.3% provides scope to realize potential
development gains on completion
ACCRETIVE DEVELOPMENT & EXPANSIONS – Generation REIT
TWO PROJECTS
(FRANKSTON & CASEY)
ARE NEARING
COMPLETION WITH
CONSTRUCTION OF
CLAREDON STREET
EXPECTED TO
COMMENCE IN Q2/17 Millions of A$ Projects
Est.
Completion Project Cost Cost to
Complete
Development
Yield
Projected
NOI
Potential
Value
Accretion
Frankston
Private
Expansion
Q2 2017 29.5 6.4 8.5% 2.5 14.1
Casey
Private
Hospital
Q4 2017 44.8 19.0 8.0% 3.6 14.9
Epworth
Freemasons
Clarendon St
Q1 2019 36.0 36.0 8.4% 3.0 16.4
3 110.3 61.4 9.1 45.9
22
ACCRETIVE DEVELOPMENT & EXPANSIONS – Vital Trust
Million of A$ Projects Est.
Completion Project Cost Cost to
Complete
Project
Yield
Project
NOI
Potential
Value
Accretion
Palm Beach Q4 2017 6.3 5.4 8.0% 0.5 1.0
Sportsmed
Consulting
Q4 2017
9.5 7.1
8.0%
0.8 1.5
Toronto
Private
Q4 2017
9.4 8.0
8.0%
0.8 1.5
Maitland
Private Q4 2017 13.6 11.8 8.0% 1.1 2.2
Lingard
Private Q4 2018 23.8 23.0 8.0% 1.9 3.9
5 62.6 55.3 5.0 10.2
FIVE DEVELOPMENT
PROJECTS TOTALLING
~ A$63M ARE
CURRENTLY
UNDERWAY .
BROWNFIELD
REDEVELOPMENTS
REMAINS CORE TO
VITAL’S BUSINESS
MODEL AND A KEY
DRIVER OF NOI
GROWTH
The projects include a mix of modernisation and expansion at acute surgical and
mental health facilities to meet the growing demand for healthcare services
$5.0M of stabilized net operating income (at 100% interest)
$10M of potential development gains on completion (at 100% interest)
23 23
S T R AT E G Y & O U T L O O K
24
RELATIVE VALUATION
THE REIT IS TRADING
AT A SIGNIFICANT
DISCOUNT TO ITS
PEERS ON AN AFFO
MULTIPLE BASIS
11.2x
15.9x
20.5x
(3.4%)
- Based on NWH.UN’s closing unit price of $10.31/unit as of February 23, 2017 and normalized AFFO/Unit of $0.92 per year ($0.23/unit for the quarter)
- NWH.UN’s NAV is based on Q4 2016 normalized of $12.10.
(1.3%)
25.8%
25
INVESTOR FACTSHEET
Ticker NWH.UN
Listed Exchange TSX
Distribution Payable Monthly
Distribution Type 100% Return of Capital for 2016
Unit Price $10.31 (February 23, 2016)
Market Capitalization ~$1.0BI
Distribution Yield ~7.8%
52-Week Trading Range $9.02 - $10.91
Volume Weighted Avg. Price (VWAP) (20-day) $10.11
Average Daily Volume (20-day) 187,711
NAV (Q4-2016) (7) $12.10
26 26
I N V E S T M E N T T H E S I S
A P P E N D I X 1
27
DEFENSIVE, HIGH YIELDING SECURITY WITH GROWTH POTENTIAL
Supportive Fundamentals
Attractive Asset Class
Growth Opportunities
Value Opportunity
Proven & Aligned
INVESTMENT HIGHLIGHTS
• Favourable demographics and industry trends
• Aging populations
• Rising healthcare expenditures
• Defensive core healthcare infrastructure
• Global gateway cities
• Leading healthcare operators
• Significant internal and external growth opportunities
• Inflation indexed leases
• Accretive expansions + industry consolidation
• Currently trading at an AFFO multiple discount to Canadian
REIT peers
• 10+ year public company track record
• Highly aligned founder and management
28
Aging Population
>65 population cohort growing
rapidly in developed countries
604mm people worldwide over 65 by
2020, ~10% of global population
Consolidation & Cost
Savings
Scale required for efficiency and
quality
Rise of Public Private partnerships
Growing Populations and
Wealth Creation
Emerging economies demanding
better access to quality care
Patients seeking more choice and
control
The Rise of Private
Healthcare
Budget pressures affecting the
sustainability of public healthcare
funding
Governments mandating lower costs
and improved quality
Increased Healthcare
Spending
$8.7 trillion global healthcare
spending by 2010
10.6% of global GDP
Growing at 5.2% per annum
COMPELLING NEED FOR CAPITAL, FACILITIES AND REAL ESTATE SOLUTIONS
Source: Deloitte 2017 Global Healthcare sector outlook
KEY DRIVERS OF HEALTH CARE REAL ESTATE
29
U.S. Healthcare Opportunity
• NWH’s markets comprise a total population of ~350 million, slightly
larger than the United States
• Total healthcare real estate opportunity estimated to be comparable
to the US (~$1 Trillion) across NWH’s markets
• Significant potential consolidation opportunity with NWH’s platform
currently comprising ~$3.7 billion
HISTORICAL NOI GROWTH OF “BIG 3 HEALTHCARE REITS (1)
Source: Green Street Advisors (January 2017)
HEALTHCARE REAL ESTATE OPPORTUNITIES
NWH’s Market Opportunity
• Estimated U.S. healthcare real estate market exceeds $1 Trillion
• Largest healthcare REITs acquired over $100 Billion over last 10
years; still own less than 15% of the market
• Large U.S Healthcare REITs historically generated better returns with
lower volatility
30 30
REGIONAL PORTFOLIO O V E R V I E W S
A P P E N D I X 2
31
PORTFOLIO PROFILE
GLOBAL HEALTHCARE REAL ESTATE INFRASTRUCTURE PROFORMA
PORTFOLIO
COMPRISES 141
PROPERTIES
TOTALING 9.5M
SQUARE FEET OF GLA
IN FIVE COUNTRIES
STRONG OPERATING
FUNDAMENTALS
WITH OCCUPANCY OF
95.6%, WALE OF
11YEARS AND 54% /
46% MOB/HOSPITAL
MIX
Q4 2016 PF
Canada Brazil Germany Vital Trust
GHC
Proforma
Germany
Proforma
Platform
Number of
Properties 58 7 20 38 16 2 141
Asset Mix (2) 100% MOB 100%
Hospital 100% MOB
~24% MOB /
~76% Hospital
~66% MOB /
~34% Hospital 100% MOB
54% MOB /
46% Hospital
GLA (Million
Square Feet) 4.0 1.5 0.8 2.0 1.1 0.1 9.5
Gross Assets (3) $1,222 $651 $192 $1,004 $602 $29 $3.9B
Occupancy 91.6% 100.0% 95.4% 98.7% 98.4% 95.4% 95.6%
WALE (Years) 4.8 21.7 4.7 17.7 12.0 4.7 11.0
Avg. Building
Age (Years) ~29 ~12 ~25 ~19 ~12 [~] ~22
Weighted
Average Cap
Rate 6.6% 8.5% 5.8% 6.9% 6.7% 5.8% 7.1%
32
CANADA: LARGEST PORTFOLIO OF MOB ASSETS
Dundas-Edward Centre
Toronto, ON
Le Carrefour Medical
Laval, QC
YT
SK
QC
ON
NU
NT
NL
MB
BC AB
NB
PE
NS
Winnipeg (2)
Edmonton (4)
Calgary (7)
Airdrie (1)
Spruce Grove (1)
INVESTMENT AND MARKET OVERVIEW
Canada’s largest non-government owner/manager of MOBs and
healthcare related facilities
Portfolio of 58 properties comprising GLA of 4.0 million sf and
~1,102 tenants
91.6% occupancy and ~4.8 year WALE
High quality real estate with stable cash flow underpinned by
tenancies supported by the Canadian publicly funded healthcare
system
Provides stability and diversification to a broader international
healthcare real estate portfolio
QC PE ON
NS
NB
Levis (1)
Laval (1) Lachenaie (1) Joliette (1)
Hamilton (3)
Halifax (2)
Guelph (2)
Fredericton (1)
Collingwood (1)
Cambridge (1)
Richelieu (1)
Quebec City (3)
Ottawa (1)
Oakville (1)
New Glasgow (1) Moncton (1)
Mississauga (1)
Lower Sackville (1)
Longueuil (2)
London (2)
Whitby (1)
Vaudreuil-Dorion (1)
Toronto (10)
Montreal (1) Saint Hubert (1)
CANADA
Barrie (1)
33
BRAZIL: NEWLY BUILT PRIVATE PAY HOSPITAL ASSETS
INVESTMENT AND MARKET OVERVIEW
Institutional quality, core healthcare infrastructure assets in
strategic markets including São Paulo, Brasilia and Rio de Janiero
100.0% occupancy and ~21.7 year WALE
Stable cash flow with long-term, triple-net, inflation-indexed
leases, providing consistent organic growth
Long-term relationship with one of the country’s leading hospital
operators Rede D’Or São Luiz S.A. (S&P National Rating: AA-)
Hospital Caxias D’Or
Rio de Janeiro
Hospital Infantil Sabará
São Paulo
Manaus Bele
m Fortaleza
Natal
Recife
Macieo
Salvador
Brasilia
Rio De Janeiro São Paulo
Port Alegre
Hospital Coração Hospital Santa Luzia
Hospital Caxias
Hospital Brasil Hospital Sabará
PARA
GOIAS
FEDERAL
DISTRICT
AMAZONAS
BAHIA
SÃO PAULO RIO DE JANEIRO
RIO GRANDE
DO SUL
CEARA RIO GRANDE
DO NORTE
ALAGOAS
PERNAMBUCO
AMAPÁ
MINAS GERAIS
RORAIMA
MARANHÃO
PIAUI
TOCANTINS RONDÔNIA
ACRE
MATO GROSSO
DO SUL
PARANÁ
SANTA
CATARINA
Hospital Ifor
Hospital Santa Helena
Existing Assets
34
GERMANY: STRATEGICALLY LOCATED MOB ASSETS
6
1
1
11
Berlin Assets
Leipzig Portfolio
Ingolstadt
Fulda
NORDRHEIN-WESTFALEN
NIEDERSACHSEN
BADEN-WÜRTTEMBERG
SAXONY-ASPHALT
HESSEN
RHINELAND-PFALZ
BERLIN
SACHSEN
HAMBURG
SCHLESWIG-
HOLSTEIN
BRANDENBURG
BAYERN
MECKLENBURG-VORPOMMERN
SAARLAND
BREMEN
THURINGIA
INVESTMENT AND MARKET OVERVIEW
High quality MOB assets located in the major markets including Berlin,
Frankfurt, Ingolstadt and Leipzig
95.4% occupancy and ~4.7 year WALE
Highly fragmented MOBs market in Germany presents a unique
opportunity to consolidate healthcare infrastructure assets accretively
Fully integrated property management and asset management
capabilities allow efficient operation and deal sourcing
Polimedica
Berlin
Adlershof 1
Berlin
Hollis Centre
Ingolstadt
Berlin Neukolln
Berlin
Munich
Frankfurt
35
AUSTRALASIA (1): STRATEGIC INVESTMENT IN VITAL TRUST
WESTERN AUSTRALIA
NORTHERN
TERRITORY
QUEENSLAND
SOUTH AUSTRALIA
NEW SOUTH WALES
VICTORIA
TASMANIA
3
4
4
12
6
1
NEW ZEALAND
8
AUSTRALIA
Marian Centre
Perth, AU
Epworth Eastern Medical Centre
Melbourne, AU
Ascot Hospital
Auckland, NZ
Epworth Eastern Hospital
Melbourne, AU
INVESTMENT AND MARKET OVERVIEW
Manager and 24.7% strategic shareholder of Vital Trust (NZX:VHP),
Australasia’s largest listed healthcare real estate owner with 21 private
hospitals, 9 MOBs, 4 aged care assets and 4 development lots
98.7% occupancy and ~17.7 year WALE
Stable and growing cash flows underpinned by tenancies of high
quality hospital and healthcare operators with long-term, inflation-
indexed leases
36
AUSTRALASIA (2): STRATEGIC INVESTMENT IN GENERATION HEALTHCARE
Epworth Freemasons Private Hospital Melbourne CBD, Victoria
Epworth Victoria Parade Hospital Melbourne CBD, Victoria
Australian Red Cross Blood Clinic Brisbane, Queensland Major Market Focus
− The portfolio is centered around Australia’s three largest
cities: Sydney (pop: ~4.9m), Melbourne (pop: 4.5m), and
Brisbane (pop: ~2.3m)
Stable, Growing & Accretive Cashflow
− Long-term inflation indexed leases to some of the region’s
largest hospital operators
− Track record of earnings growth through accretive
acquisitions, expansions, and developments
Core Healthcare Strategy
− 10+ years of dedicated healthcare focus
− Strong healthcare operator relationships Healthscope,
Epworth Foundation, and St. John of God
STRATEGIC FIT
WESTERN AUSTRALIA
NORTHERN
TERRITORY
QUEENSLAND
SOUTH AUSTRALIA
NEW SOUTH WALES
VICTORIA
TASMANIA
8
3
5
PORTFOLIO OVERVIEW
Generation Healthcare REIT (ASX:GHC) is a leading
Australian listed healthcare REIT with over A$600M in
existing assets and a A$128M+ development pipeline of
yields at ~8.0% on average.
Portfolio of 16 Properties of ~1.1M Square Feet 6 hospitals, 5 medical centers, 3 residential aged care, and 2 lands
development parcels currently under construction
Strong occupancy and long-term lease expiry profile 98.4% occupancy and ~12.0 year WALE
Casey Specialist Centre Melbourne Suburb, Victoria
37 37
M A N A G E M E N T B I O G R A P H I E S
A P P E N D I X 3
38
Gerson Amado
Managing Director – Brazil
Leading healthcare real
estate asset management
platform
Relationships with hospital
operators
Office in Sao Paulo / 6
professionals
Jan Krizan
Managing Director – Germany
Established platform with
full property and asset
management capabilities
Office in Berlin
19 professionals
David Carr
CEO – Vital Trust
Fully integrated property
management and asset
management
Offices in Auckland and
Melbourne
12 professionals
Miles Wentworth
CEO – Generation REIT
Fully integrated asset &
development management
Office in Melbourne
6 professionals
Paul Dalla Lana
Chairman & CEO
Founder of NWH & NWI
REITs
Largest unitholder of REIT
Bernard Crotty
President
Previously President – NWI
REIT and Trustee – NWH
REIT
Shailen Chande
CFO
Previously VP, Finance and
Investments NWI REIT and
its predecessor companies
Chartered Accountant
Peter Riggin
COO & MD Canada
Previously President –
Canada, NWH REIT and
CEO – NWH REIT
GLOBAL PLATFORM WITH REGIONAL CAPABILITY AND EXPERTISE
HIGHLY EXPERIENCED
AND ALIGNED EXECUTIVE
MANAGEMENT TEAM
FULLY ESTABLISHED,
SCALABLE REGIONAL
TEAMS WITH EXPERTISE
IN HEALTHCARE
PROPERTY OPERATIONS,
ACQUISITIONS AND
DEVELOPMENT
LOCAL MARKET
KNOWLEDGE AND
STRONG RELATIONSHIPS
WITH LEADING
HEALTHCARE PROVIDERS
OVER 180
PROFESSIONALS ACROSS
9 OFFICES IN 5
COUNTRIES
MANAGEMENT – COMBINED REIT REGIONAL OPERATING PLATFORM AND EXPERTISE
39
NOTES
1. Based on NWH.UN’s closing unit price of $10.31/unit as of February 23, 2017.
2. Based on the REIT’s distribution policy of $0.80/unit per annum and normalized Q4-16 AFFO of $0.92/unit.
3. Based on total assets of NWH, Vital Trust and GHC on a fully consolidated basis including post-quarter acquisitions. NHW owns a 24.7% interest in Vital Trust and 19.8% interest in Generation.
4. In the REIT’s Q4-2016 MD&A, the diversification charts for the countries and asset mix are based on investment value and GLA respectively. The pie charts above reflect proportionate NOI, excluding the
assets held for sale in Canada and include i) the REIT’s 19.8% and 24.7% proportionate ownership of GHC and Vital Trust, respectively and ii) the announced 2 Germany acquisitions and iii) Vital and
Generation management fee income.
5. Reported AFFO/Unit represents quarterly AFFO annualized for the three month period ending December 31, 2016. Normalized AFFO/unit is based on Q4-16 Reported AFFO/unit and adjusted for completed
acquisitions, and financings as presented in the REIT’s Q4-16 MD&A PART XIII.
6. LTV excludes/includes convertible debentures and is shown on a fully consolidated basis (Vital Trust at 100%). On a proportionate ownership basis, Reported LTV is 46.6% / 59.5% and Normalized LTV is
44.2% /56.9%, respectively.
7. NAV is based on unitholder’s equity plus add-backs of (i) $193.8M of Class B and D exchangeable units; (ii) $93.5M related to the REIT’s proportionate share of its deferred tax liability; (iii) $6.6M net derivative
financial instruments; (iv) $14.7M DUP liability; (v) $2.5M accrued Ontario LTT; and, (vi) $13.5M adjustment to the fair value of the Vital Manager. Normalized NAV is based on reported NAV adjusted for (i)
Post Q4-16 F/X rates, (ii) January Equity Offering, (iii) Brazil Cap Rate compression
8. At inception represents metrics for NorthWest Healthcare Properties based on the IPO prospectus dated of March 25, 2010.
9. Represents same property NOI growth YoY (“SPNOI”) for the three months ended December 31, 2016 in source currency and excludes non-cash amortization and non-recurring transactions.
10. Represents Financial Statements as of December 31, 2016 adjusted for completed acquisitions, and financings as presented in the REIT’s Q4-16 MD&A PART XIII.
11. Reflects the debt maturity profile as per the REIT’s Q4-16 MD&A and does not include deferred consideration.
12. Gross rent has been adjusted to reflect the REIT’s 24.7% proportionate interest in Vital Trust as well as recording Hospital Sabara at its gross rent (before financing) and includes projected gross rent from the
REIT’s 19.8% proportionate ownership of GHC.
13. LTV’s are excluding corporate debt (ie. convertible debentures and revolving credit lines) and are shown on a regional basis.
14. Represent estimate of current market rates.
15. Assuming projects are 100% debt funded at the existing region’s financing costs and is for indicative purposes only. Does not include development pipeline from announced acquisitions.
40
CONTACT INFORMATION
Paul Dalla Lana, Chairman & CEO
416-366-2000 Ext. 1001
Shailen Chande, CFO
416-366-2000 Ext. 1002
NORTHWEST HEALTHCARE PROPERTIES REIT