GPT : Retail Roundtable

Microsoft PowerPoint - Retail Round Table - Morgan Stanley.pptx THE GPT GROUP RETAIL ROUNDTABLE Hosted by Morgan Stanley

Wednesday 1 June 2016

CONFIDENTIAL

Monthly Specialty Sales Growth1,2

31 March 2016

Moving Annual Change in Retail Sales by Category1

31 March 2016

6 monthly growth = 7.3% 6 monthly growth = 4.7%

17.1% 16.5%

14.3%

6.0%

6.9%

9.3%

7.8%

9.3%

4.6%

5.7%

5.0%

8.6%

Quarterly = 3.0%

4.6%

3.7%

2.4%

1.0%

3.6%

2.3%

5.9%

7.4%

6.5% 6.1%

4.8%

2.0%

2.8%

3.5%

-0.7%

-1.3%

Total Centre

Dept Store

DDS

Supermarket

Mini Majors

Other Retail

Total Specialties

Mobile Phones

General Retail

Homewares

Jewellery

Leisure

Food Catering

Retail Services

Apparel

Food Retail

1.1%

Mar-15

Apr-15

May-15

Jun-15

Jul-15

Aug-15

Sep-15

Oct-15

Nov-15

Dec-15

Jan-16

Feb-16

Mar-16

Specialties breakdown

1. Based on GPT weighted interest. Excludes development impacted assets (Macarthur Square and Wollongong Central).

2. Based on GPT weighted interest. Excludes development impacted assets (Macarthur Square and Wollongong Central). Forestway Shopping Centre excluded from November 2015. Macarthur Square excluded from March 2016.

Capitalisation Rates

CONFIDENTIAL

Retail Capitalisation Rates

$'Billion

35

Historical Sales Transactions: Australia

Office Retail Industrial Multiple

%

8.5 30

25

8.0 20

15

7.5 10

7.0

6.5

6.0

5.5

Mar‐05

Mar‐06

Mar‐07

Mar‐08

Mar‐09

Mar‐10

Mar‐11

Mar‐12

Mar‐13

Mar‐14

Mar‐15

Mar‐16

5.0

Source: MSCI IPD, JLL, Stonebridge, Colliers

Neighbourhood

Sub Regional Regional

Super & Major Regional

5

0

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Recent Major Retail Transactions

Centre

State

Value

($m)

Runaway Bay Shopping Village	QLD	160.0
Toombul Shopping Centre	QLD	228.3
Clifford Gardens Shopping Centre	QLD	188.0
Brimbank Shopping Centre	VIC	165.2
Forest Hill Chase	VIC	269.8
Mid-City Retail Centre	NSW	320.0
World Square	NSW	286.0
Dandenong Plaza	VIC	197.0

Myer Centre, Melbourne VIC 150.0

CONFIDENTIAL

• Strong retail sales growth moderating in recent periods

• Consistent specialty lease terms

• Rental reversions improving

• Highly productive international and domestic retailers are moving to >400sqm

• Consumer preference for experience are driving centre evolution

• International fast fashion bringing excitement to apparel category

• Evolving Department and Discount Department store retail offer

• Use of "big data" to maximise income and returns

• Moderation of online

• Increase in forecast retail supply in regional and neighbour space

• Variables impacting retailer sales and profitability: Depreciating AUD, lower interest rates, in- bound and domestic tourism growth, federal election, softening household savings ratio, lower fuel price