2018 Preliminary Results Presentation Charles Peach, CFO Jonathan Laredo, CEO Michael Gibbons, CIO
Disclaimer This presentation (hereinafter "this document") has been prepared by Yew Grove REIT plc (the "Company“ or “Group”) for information purposes only. This document has been prepared in good faith but the information contained in it has not been independently verified and does not purport to be comprehensive. This document is neither a prospectus nor an offer nor an invitation to apply for securities. No representation or warranty, express or implied, is given by or on behalf of the Company, its group companies, or any of their respective shareholders, directors, officers, employees, advisers, agents or any other persons as to the accuracy, completeness, fairness or sufficiency of the information, projections, forecasts or opinions contained in this document. In particular, the market data in this document has been sourced from third parties. Save in the case of fraud, no liability is accepted for any errors, omissions or inaccuracies in any of the information or opinions in this document. Forward-looking statements This Announcement contains forward-looking statements, which are subject to risks and uncertainties because they relate to expectations, beliefs, projections, future plans and strategies, anticipated events or trends, and similar expressions concerning matters that are not historical facts. Such forward-looking statements involve known and unknown risks, uncertainties and other factors, which may cause the actual results, performance or achievements of the Group or the industry in which it operates, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. The forward-looking statements speak only as at the date of this Announcement. The Group will not undertake any obligation to release publicly any revision or updates to these forward-looking statements to reflect future events, circumstances, unanticipated events, new information or otherwise except as required by law or by any appropriate regulatory authority. 2
Table of Contents 1. Key Highlights 2. Portfolio Overview 3. Financial Review 4. Market Commentary 5. Conclusion and Outlook 3
1. Key Highlights
Key Highlights • Successful IPO and additional debt raise • Full deployment of the IPO proceeds in less than 7 months, and continue to develop the acquisition pipeline • Diversified and differentiated portfolio – ex-Dublin CBD, well built, well tenanted, with strong income • EPRA NAV per share above par within 7 months • Impressive income profile resulting in dividend for 2018, and quarterly distribution from 2019 onwards 5
Financial Highlights Period to Dec 31 18 Profit for the period €2.3m Net valuation change €1.6m Adjusted EPS 3.1c Net income (excluding property valuation gains) per share 0.964c Dividend per share 0.964c PID per share 0.870c Portfolio value €77.9m EPRA NAVPS 100.2c Loan facility €19.9m ‒ Facility drawn down €6.2m ‒ Headroom €13.7m Loan to Value 8.0% 6
2. Portfolio Overview
Portfolio Overview Portfolio by Tenant Type Location Key 2% 5% Building One, 1 Office Gateway 2 FDI Letterkenny 2 Office Govt/State Offices Large corporate 39% Building Three, 54% 3 Office Gateway SME 5 4 Ashtown Gate Office 4 Athlone Airways 1+3 5 Industrial Galway Dublin Industrial Estate 6 Catchment 13 6 IDA Athlone Industrial 8 Area 5 12 Blackwater 14 9 7 Office Limerick House 10 Portfolio by Asset Type 8 Bridge Centre Retail 11 7 9 Holly Avenue Industrial 2% Cork 10 Naas Enterprise 3% Industrial Park 18% Office 11 Listowel Office/Retail Industrial 12 Canal House Office/Retail Mixed Use 13 Heather Road Industrial Retail 14 Centre Point Industrial 77% 8
Detailed Portfolio Breakdown Reversionary WAULT to WAULT to Value ( € ‘m) Current Rent Yield to Yew Reversionary Type Location Yield to Yew Lease Break Lease End Vacancy (€‘000) Grove Rent (€’000) Grove (Years) (Years) Building One, 1 Office Dublin 18.0 1,101.2 6.1% 1,398.5 7.8% 3.5 5.0 5.6% Gateway Letterkenny 2 Office North West 16.0 1,436.7 9.0% 1,489.6 9.3% 9.3 9.3 0.00% Offices Building Three, 3 Office Dublin 14.0 913.4 6.5% 1,070.6 7.7% 2.0 2.0 0.00% Gateway 4 Ashtown Gate Office Dublin 9.4 766.7 8.2% 755.5 8.1% 3.0 7.3 0.00% Airways Industrial 5 Industrial Dublin 4.5 300.0 6.6% 461.9 10.2% 6.8 11.8 0.00% Estate 6 IDA Athlone Industrial Midlands 3.9 386.7 10.0% 443.5 11.5% 4.7 15.7 0.00% 7 Blackwater House Office Cork 2.3 229.0 10.1% 358.8 15.9% 1.6 5.5 24.9% 8 Bridge Centre Retail Midlands 1.9 229.2 11.8% 177.6 9.2% 2.4 3.0 0.00% 9 Holly Avenue Industrial Dublin 1.8 169.9 9.4% 169.9 9.4% 2.1 9.1 0.00% Naas Enterprise 10 Industrial Dublin 1.7 170.0 9.9% 185.5 10.8% 4.2 4.2 0.00% Park 11 Listowel Office/Retail South West 1.6 275.9 16.9% 150.3 9.2% 4.2 10.7 0.00% 12 Canal House Office/Retail Midlands 1.0 106.5 10.8% 51.6 5.2% 8.0 8.0 0.00% 13 Heather Road Industrial Dublin 1.0 92.5 9.7% 53.0 5.6% 10.7 10.7 0.00% 14 Centre Point Industrial Dublin 0.9 110.0 12.9% 51.0 6.0% 7.7 7.7 0.00% Total 77.9 6,287.7 8.1% 6,817.3 8.7% 4.9 7.4 3.5% 9 Note: Figures are as at 31 Dec 2018
One and Three Gateway Key Facts One Gateway Three Gateway Valuation: € 18m €14m Asset type: Office Office Area 1 : 51,645 sq. ft 43,211 sq. ft Yield to Yew Grove 2 : 6.1% 6.5% Vacancy: 5.6% 0.0% Reversionary yield: 7.8% 7.7% WAULT to break: 3.5 2.0 WAULT to lease end: 5.0 2.0 Asset acquired July 2018 • ‒ Offices developed in phases between 2007 and 2009 ‒ Located immediately south of Eastpoint Business Park and north of the IFSC and North Docklands ‒ Location increasing in value as the area matures in line with the substantial development of the North Docklands ‒ Business case is focused on increasing ERV’s in line with market recovery and increased attractiveness of location to interna tional occupiers who wish to establish themselves in Dublin City Centre Asset Management • ‒ Letting vacant space and managing rent reviews ‒ Proactive discussions with tenants about post break occupancy 10 1. The building area excluding the basement car park, and showers 2. Yield is the current rent divided by the all in cost or latest valuation (if the building has been valued since purchase 10
Offices 1, 2 & 3 Letterkenny Office Park Key Facts Valuation 1 : € 16m Asset type: Office Area: 100,548 sq. ft Yield to Yew Grove: 9.0% Vacancy: 0.0% Reversionary yield: 9.3% WAULT to break: 9.3 WAULT to lease end: 9.3 Asset acquired December, 2018 • ‒ Offices developed in phases between 2001 and 2007 and totally refurbished in 2016, adjacent land includes 688 surface car parking spaces ‒ All 3 buildings are let to Optum, a subsidiary of United Healthcare Inc (which guarantees the leases) ‒ The buildings are situated on one of the 3 neighbouring IDA parks which ring Letterkenny town ‒ Letterkenny is the centre of a regional stronghold of FDI business with Pramerica, United Health, Optibelt, SITA and Cloudranger amongst local occupiers. The town benefits from excellent business infrastructure including some of the best superfast broadband in the country. The planned development of the national motorway network will improve road access to an area already close to sea and air connections Asset Management • ‒ The tenant is actively considering an expansion on the site to house its rapidly growing workforce and discussions on a potential forward funded development will begin in 2019 11 1. The properties cost €16 million plus associated costs of c €1.2 million. The three properties have been valued together. 11
Blackwater House, Mallow Key Facts Valuation 1 : €2.3 m Asset type: Office Area: 28,880 sq. ft and 200 car park spaces Yield to Yew Grove: 10.1% Vacancy 2 : 24.9% Reversionary yield: 15.9% WAULT to break: 1.6 WAULT to lease end: 5.5 • Asset acquired in October, 2018 ‒ Offices developed in 2000 and situated on a business park which also houses a substantial Primary Healthcare Centre ‒ The building purchase came with land on the park which is zoned for office/industrial development • Asset Management ‒ Initially over 40% vacancy and three of the existing tenants [holding over]. The immediate plan is to regularise the existing leases, rent the vacant space and manage the upcoming rent reviews ‒ The park has zoned land and discussions with the IDA and potential OPW/FDI tenants will begin with a view to developing a forward funded opportunity 12 1. The valuation of the property has been adjusted to account for c €400k of capital expenditure which will occur over a year, a nd includes c. €220k of value for the development land adjoining the property 2. Vacancy is calculated at the reversionary rental value
3. Financial Review
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