HALF

YEAR

UPDATE

2017

Dear Investor,

I am pleased to update you on the activities and financial results of The GPT Group for the half year ended 30 June 2017.

GPT delivered strong financial performance during the period, with a Total Return of 16.9 per cent on a rolling 12 month basis. The value of the Group's investment portfolio increased by $480 million during the half, with Net Tangible Assets per security rising to $4.88, an increase of 6.3 per cent.

Funds From Operations (FFO) per security growth, which is the REIT sector's key measure of earnings, was 3.5 per cent higher compared to the previous corresponding period. This was primarily driven by 4.7 per cent like-for-like income growth across the Group's portfolio, supported by the high level of occupancy of 96.9 per cent. Total distributions of

12.3 cents per security were declared for the six months.

The Group's statutory profit for the six months to

30 June 2017 was $752.3 million, a 28.3 per cent increase on the prior corresponding period.

The Group's Retail portfolio delivered total centre sales growth of 3.4 per cent over the 12 month period to

30 June 2017. GPT's ongoing focus on strategic investment in our assets and maintaining the right tenant mix were key to the Retail portfolio's performance.

The Office portfolio continued to deliver strong results, with like-for-like income growth of 5.8 per cent over the period. This was driven by high portfolio occupancy and growth in net effective rents in the Group's core markets of Sydney and Melbourne.

The Group has also made solid progress advancing its development pipeline.

Construction of GPT's 15,700 square metre A Grade office development at 4 Murray Rose, Sydney Olympic Park commenced during the period. The Group's plans for a 26,000 square metre prime office tower at 32 Smith Street Parramatta reached an important milestone with a scheme submitted by Fender Katsalidis Architects for the proposed building being awarded design excellence by Parramatta City Council.

During the half, GPT delivered new logistics facilities in Huntingwood and Seven Hills in Sydney, both of which are now fully leased. Works also commenced on the development of two new logistics assets in Eastern Creek in Sydney.

GPT's Funds Management business continues to achieve strong results, delivering a Total Return for 12 months to 30 June of 17 per cent.

During the period, the GPT Wholesale Shopping Centre Fund (GWSCF) saw investors approve renewed Fund terms ahead of its ten year anniversary, and the successful completion of its first liquidity review. In May, GPT took the opportunity to acquire an additional $112 million in securities, increasing its investment in the Fund from 25.3 per cent to 28.9 per cent.

OUTLOOK

GPT is well positioned to deliver growth in earnings for securityholders as it heads into the second half of 2017.

At the Group's Interim Result announcement on 15 August, we upgraded earnings guidance for 2017 to 3 per cent growth in FFO per security, up from the 2 per cent announced in February. Distributions per security growth of approximately 5 per cent is expected.

Bob Johnston

CEO & MANAGING DIRECTOR

The revised earnings guidance reflects the strong performance of the business, supported by a high level of occupancy and income growth across the portfolio.

I would like to thank all securityholders for their ongoing support, and I look forward to updating you on the Group's activities early in 2018.

Bob Johnston CEO and Managing Director

GPT CALENDAR

June 2017 half year distribution payment date 31 August 2017

December 2017 half year distribution announcement date December 2017

December 2017 half year distribution record date 31 December 2017

2017 Annual Result announcement date February 2018

December 2017 half year distribution payment date February 2018

FINANCIAL SUMMARY

Delivering results from core business

3.5%

FFO1per security

growth

16.9%

Total Return

The Group's statutory profit for the six months to

30 June 2017 was $752.3 million, a 28.3 per cent increase on the prior corresponding period. The increase in the value of the investment portfolio of $480 million was a key contributor to the statutory profit result.

The Group declared a distribution of 12.3 cents per security for the six months, which was 7 per cent higher than the

Investment Portfolio Performance

previous corresponding period.

GPT's balance sheet is in a strong position, with a low level of gearing of 24.1 per cent at 30 June 2017. The Group's

4.7%

Portfolio like for like

$480m

Portfolio valuation

weighted average cost of debt decreased by five basis points during the period to 4.2 per cent.

6 months to 30 June 2017 2016 Change

income growth

uplift

Funds From Operations ($m)

279.8

269.8

3.7%

Net profit after tax ($m)

752.3

586.4

28.3%

Distribution

Capital Management

FFO per ordinary security (cents)

15.54

15.02

3.5%

FFO yield (based on period end price)

6.5%

5.6%

90 bps

12.3¢

Distribution per

security 1H17

24.1%

Net gearing

Distribution per ordinary security (cents) 12.3 11.5 7.0% Distribution yield (based on period end price) 5.2% 4.3% 90 bps Net interest expense ($m) (47.2) (50.1) 5.8%

Interest capitalised ($m) 11.8 3.4 247.1%

Weighted average cost of debt 4.2% 4.3% 10 bps

Interest cover 7.0 times 6.3 times 0.7 times

Portfolio Leasing & Occupancy

As at 30 Jun 17

As at 31 Dec 16

Change

96.9%

Total portfolio

occupancy

5.2yrs

Weighted average

lease expiry

Total assets ($m) 12,532.9 11,817.9 6.1%

Total borrowings ($m) 3,179.7 2,996.6 6.1%

NTA per security ($) 4.88 4.59 6.3%

Net gearing 24.1% 23.7% 40 bps

Net look through gearing 26.2% 25.7% 50 bps Weighted average term to maturity of debt 5.9 years 6.5 years 0.6 years

KEY FINANCIAL HIGHLIGHTS FOR THE

Credit ratings

Weighted average term of interest

A (stable)

A3 (stable)

A (stable)

A3 (stable)

No

Change

SIX MONTHS TO 30 JUNE 2017 INCLUDED:

rate hedging 5.1 years 4.4 years 0.7 years

Net Profit After Tax of $752.3 million, up 28.3 per cent

Funds From Operations (FFO) per security growth 3.5 per cent

16.9 per cent Total Return on a rolling 12 month basis

24.1 per cent net gearing

Net Tangible Assets of $4.88 per security up 29 cents

1. Funds from operations.

The GPT Group published this content on 01 September 2017 and is solely responsible for the information contained herein.
Distributed by Public, unedited and unaltered, on 01 September 2017 08:42:06 UTC.

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