Presentation

Westfield Group
Australian Business Overview
- UBS Property Tour
March, 2009
Portfolio Summary as at 31 December 2008
Centres
Retail Outlets
GLA (million sqm)
Westfield Asset Value (billion)
1
Assets Under Management (billion)
2
Gross Lettable Area
United
States
Australia
United
Kingdom
New
Zealand
Total
55
44
8
12
119
8,843
12,070
1,256
1,670
23,839
5.9
3.7
0.6
0.4
10.6
US$15.5
$20.9
£1.9
NZ$3.0
$49.9
US$18.7
$29.3
£4.9
NZ$3.2
$69.4
Assets Under Management
UK
15%
UK
6%
Australia
35%
US
55%
NZ
4%
Australia
42%
US
39%
NZ
4%
1
WDC share of shopping centre assets and excludes work in progress and assets held for redevelopment
WDC and joint venture share of shopping centre assets and includes work in progress and assets held for redevelopment
Note: Exchange rates as at 31 December 2008 were AUD/USD 0.6897, AUD/GBP 0.4775, AUD/NZD 1.1961
2
2
Westfield Australian Portfolio Composition
The portfolio is diversified across six Australian states and territories
Geographic Diversification
SA
4.6%
QLD
17.4%
WA
8.1%
VIC
14.0%
ACT
4.6%
NSW
51.3%
Total portfolio value - $20.9bn
3
Australian Shopping Centres
North Queensland
Cairns Central* (50%)
Brisbane
Carindale** (50%)
Chermside
Mt Gravatt (75%)
Helensvale (50%)
North Lakes (50%)
Strathpine
Gold Coast
Pacific Fair* (44%)
Central Coast
Tuggerah
Kotara
Perth
Booragoon* (25%)
Carousel
Innaloo
Karrinyup* (33.3%)
Whitford City (50%)
Adelaide
Sydney
Marion (50%)
Tea Tree Plaza (50%)
West Lakes (50%)
Wollongong
Figtree
Warrawong
Melbourne
*
**
Properties managed by a third party
Held via Carindale Property Trust
Airport West (50%)
Bay City Plaza (50%)
Fountain Gate
Knox* (30%)
Plenty Valley (50%)
Southland (50%)
Doncaster (50%)
Canberra
Bondi Junction
Burwood
Chatswood
Hornsby
Hurstville (50%)
Liverpool (50%)
Macquarie*(55%)
Miranda (50%)
Mt Druitt (50%)
North Rocks
Parramatta (50%)
Penrith Plaza (50%)
Sydney CBD
Sydney Central Plaza
Warringah Mall* (25%)
Belconnen
Woden (50%)
4
Retail Property in Australia
„ Australian retail property has provided consistent stable returns over the long term
„ Strong growth in consumer spending over the last decade has underpinned retail property
performance
„ Quality retail property provides secure and diversified cash flows
„ Regional shopping centres create a franchise in their trade area
„ Franchise value is strengthened by ongoing re-development
„ Currently in Australia there are 63 super regional and regional shopping centres1
„ Westfield has ownership in 32 of these centres
„ Westfield owns and manages or has interests in 24 of the top 402 centres in Australia
1
2
Urbis March 2008
By GLA
5
Diversified Nature of the Australian Portfolio
Sales Diversification – Retail Category Comparison
Australia and New Zealand
United States
8%
2%
21%
6%
13%
3%
1%
1%
1%
5%
30%
7%
5%
12%
8%
3%
2%
11%
13%
Food
Discount Department Stores
Fashion
Jewellery
General Retail
Mobile Phones & Accessories
Food Catering
2%
Department Stores
Other Majors
Footwear
Leisure
Homewares
Retail Services
Other Categories
14%
7%
4%
6
Sales – Food vs Non-Food
Australia and New Zealand
United States
2%
21%
79%
98%
Food
Non‐Food
Food
Non‐Food
NB: US sales exclude Department Stores
7
Shopping Centre Operating Performance
Portfolio
1
Leased
Australia &
Specialty
Occupancy
1
Cost
Lease Deals Completed
Number
Area
2
Average Specialty
Store Rent
Amount
1
$1,337 psm
> 99.5%
17.2%
3,113
381,840 sqm
United States
92.6%
16.3%
1,319
3,306,004 sqf
US$45.58 psf
United Kingdom
98.9%
n/a
473
185,510 sqm
£638 psm
Group
97.1%
4,905
874,488 sqm
New Zealand
NZ$1,057 psm
4
Growth
3
Comparable
2
NOI Growth
6.3%
4.7%
2.7%
0.5%
2.0%
(1.8)%
2.8%
1
As at 31 December 2008
12 months to 31 December 2008
3
31 December 2008 compared to 31 December 2007
4
Includes Derby
2
8
Comparable Retail Sales Growth by Category
– Australia
Period to 31 December 2008
12 months
6 months
3 months
(1.5)%
(5.4)%
(7.1)%
Discount Department Stores
4.2%
4.6%
3.0%
Supermarkets
6.0%
6.3%
5.0%
Cinemas
6.5%
10.0%
15.9%
Fashion
1.8%
1.2%
1.0%
Food Catering
4.8%
5.0%
5.4%
Food Retail
3.9%
5.1%
6.6%
Footwear
4.6%
4.7%
4.3%
General Retail
2.0%
0.7%
0.6%
Homewares
1.9%
0.3%
0.2%
Jewellery
4.6%
3.5%
2.7%
Leisure
9.9%
8.6%
7.9%
Retail Services
6.6%
6.3%
6.5%
Specialties
4.2%
3.5%
3.3%
TOTAL
3.7%
2.6%
1.6%
Department Stores
9
Historical Performance – Australian Portfolio
„ The Westfield Australian portfolio has consistently maintained an occupancy rate of 99% or more for each of the last 13 years,
despite the adverse impact on the retail market of the introduction of the GST in July 2000
Australian Specialty Store Rent per sqm and
Percentage Stores Leased
Australian Specialty Store Sales per sqm
$10,000
$1,400
100%
$9,643 psqm
$9,500
$1,300
90%
Introduction of
GST
$9,000
$1,200
Introduction of
GST
80%
$8,500
$1,100
70%
$8,000
$1,000
60%
$7,500
$900
$7,000
$800
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008
50%
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008
Specialty Store Rent per sqm ($)
Percentage Stores Leased
Stable centres – Australia excludes mini-majors
1
On a comparable basis
10
Westfield Australian Portfolio – Stability of Income
„ Rental income is secured through base rents payable under lease contracts
„
Less than 2% of rental income is directly linked to retail sales performance
„ Lease structures provide both stability and flexibility to drive income
„
Majors lease term – typically 20 years + with upward only reviews throughout the term.
„
Specialty lease term – average 5-7 years with annual increases of CPI + 2%
Specialty
Specialty Lease
Lease Expiry
Expiry Profile
Profile by
by Area
Area -- Australia
Australia
11
The Westfield Difference
„
Long standing track record of delivering superior returns for investors through income growth and
enhancement of value
„
Operational Strategy
„ Strong operational focus
„ Intensive management and redevelopment
„ Leveraging longstanding relationships with retailers
„ Leveraging the “Westfield” iconic brand
„ Strategic acquisitions
„ Increase market penetration
„
Continual enhancement of our portfolio
„ 64% of portfolio (28 of 44 Assets) has been redeveloped in the past 10 Years
12
Westfield’s Competitive Advantage
Leasing
„ Specialty Tenant Relationships
„
Approximately 11,780 Specialty outlets (Australian Portfolio)
„ Optimum tenancy mix tailored to each Centre’s trade area
„ Leverage relationships with specialty retailers to deliver best rent outcome
Centre Management
„ Economies of scale to control Centre operating costs through national buying power
„ Ensuring best practice through portfolio benchmarking over 50 Centres in Australia and NZ
„ Maximise income opportunities through national corporate deals such as Foxtel, Travelex.
Marketing
„ Westfield is a nationally recognised “icon” brand
„ National campaigns such as “What’s What”
„ Aggregation of Centres into “Clusters” to allow optimum Marketing and brand impact
13
Westfield’s Competitive Advantage (contd.)
Development and Asset Management
„ Established Major Tenant Relationships
„
Approximately 289 Major Tenants in Australia
„ Proven track record in delivery of high return developments
„ Strategic Asset Management of portfolio to continually enhance asset value
„ Focus on redevelopment and expansion to ensure each Centre remains relevant to its
community and customers
„ Intense defensive focus in a competitive environment
Design & Construction
„ Vertically integrated designer and builder - specialising in retail and seamless alignment
with asset/fund managers objectives
„ Integrated functions allow superior control of:
„
Construction Costs
„
Construction Programmes
„
Design development
14
Completed Redevelopment Projects – Past 5 Years
Development
Opened
WDC Share
Total Cost
(A$million)
WDC Share
(A$million)
Bondi (Sydney)
2004
100%
968
968
Innaloo (Perth)
2005
100%
60
60
10.5%
Helensvale (Queensland, Aus)
2005
50%
180
90
11.5%
Tuggerah (NSW, Aus)
2005
100%
120
120
10.2%
Mt. Druitt (Sydney)
2005
50%
65
32.5
9.2%
Parramatta ( Sydney)
Apr ‘06
100%
110
110
7.90%
Liverpool (Sydney)
Oct ‘06
50%
200
100
9.70%
Chermside (Brisbane)
Oct ‘06
100%
200
200
10.20%
Kotara (Newcastle, Aus)
Oct ‘07
100%
170
170
9.10%
North Lakes (Brisbane, Aus)
Oct ‘07
50%
190
95
9.50%
May '08
50%
210
105
10.00%
Geelong (Victoria, Aus)
Jul ’08
50%
210
105
8.80%
Doncaster (Melbourne)
Oct ’08
50%
600
300
8.75%
2,315
1,488
Plenty Valley (Melbourne)
Total
WDC Yield
on Cost1
7.6% *
1
Stabilised income/Westfield Group cost
* Yield on Pre-merger basis
15
Our Operating Platform
Goals
Financial Strategies
Operational Strategies
and Execution
and Execution
Excellence of Delivery
Asset Team Delivery
Ownership/Passion
16
Westfield Group
Case Study:
Westfield Sydney City
Project Summary
Westfield Sydney City Centre
„ Iconic world class retail and commercial development
located in the heart of Sydney’s CBD
„ Seven (7) level World class retail facility; 38,000 sqm
approx. 250 shops including fashion, diverse food & bars,
restaurants, gymnasium and childcare facilities
100 Market Street
„ Complete refurbishment and reconstruction
„ 28,900m² with large 3,000m² campus style floor
plates
„ Four full height atriums
Skygarden Offices
„ Existing 12 Level office building
„ 15,200 sqm
85 Castlereagh Street (Option)
„ New commercial office tower comprising 32,800m²
Arial view from South East
„ A grade classification with typical floors of 1,485m²
„ Spectacular 1,500m² Sky lobby (Level 7)
„ Sweeping views over Sydney Harbour and Hyde
Park.
18
Westfield Sydney City Trade Area
Market size
„ Trade area population of 4,400,000 people
„ Retail market in excess of A$55 billion p.a.
Market size – Sydney MTA
„ Trade area population of 1,500,000 million
people
„ $20.5 billion retail market
Sydney CBD - $3.8 Billion retail sales
„ 260,000 CBD workers daily
„ Tourists – CBD
David Jones and Myer Department Stores
„ Highest grossing Dept Stores in the
country combined sales >$550 million
MAT.
19
Aerial View
Sydney Central
Plaza/Myer
Westfield
Sydney City
20
Sydney City context
DAVID
JONES
SYDNEY
CENTRAL
PLAZA/
MYER
DAVID
JONES
ZU /
BETTS
176 PITT STREET
21
Project Sections
85 Castlereagh
Street
85 Castlereagh
Street
Skygarden Offices
100 Market
Street
Retail Centre
Retail Centre
Section Looking West
Section Looking South
22
Westfield Sydney
– cnr Market St & Pitt St
Westfield Sydney – cnr Pitt St. and Market St
23
Westfield Sydney
– cnr Market St & Castlereagh St
24
Westfield Sydney
– Pitt Street Mall
Westfield Sydney – Pitt Street Mall
25
100 Market Street
Estimated Practical Completion
Q1, 2010
NLA
28,900m²
Office Levels
4-13
Typical Floorplate Size
3,064m²
„ Full refurbishment and
reconstruction
„ Comprising 28,900m² NLA over
10 levels, the building features a
typical floorplate of 3,064m²
„ Existing façade will be replaced
with a new full height glazed
treatment
„ Four (4) full height atriums cut
into buildings
26
100 Market Street, Sydney – Lobby montages
View from Market Street
Concept images only
John Wardle Architects - Design Architects & Joint Project Delivery. Hassell Architects
-Joint Project Delivery JWA Architects Dock 5, Melbourne. Artwork: Dani Marti.
Photography: John Gollings
27
100 Market St – Floor Plan
28
85 Castlereagh St – Office Tower (Option*)
Estimated Practical Completion*
Q1, 2012
NLA
32,800m²
Office Levels
8-32 inclusive
Typical Floorplate Size
1,485m²
* Subject to tenant pre-commitment
„ Designed by award winning architect, John
Wardle Architect
„ Typical floor plates of 1,485m²
„ Majority levels have sweeping views over
Hyde Park and Sydney Harbour
„ 10m wide and 28m high level entrance off
Castlereagh Street
„ Dynamic 1,500m² Sky lobby at base of tower
29
85 Castlereagh St – Indicative Floorplate (high rise)
30
Project Cost and Programme
„
Project Cost (Retail & 100 Market St)
$860 million
„
Target Yield Range
8.0- 8.5%
„
Construction Start
Feb 2009
„
Retail Centre opening
April/May 2011
„
Practical Completion 100 Market Street office
early 2010
„
Castlereagh St Retail precinct opens
early 2012
31
Westfield Sydney
– Aerial Montage
Aerial Montages
32
Westfield Group
Westfield Bondi
Site Visit
Background Information
Bondi Junction Redevelopment
Before
Now
34
Westfield Bondi at a glance …
Before
Now
% Change
„ Lettable Area (sqm)
66,110
110,320
( +67%)
„ Number of Retailers
126
400
(+317%)
„ Major (sqm)
„
David Jones
17,450
19,025
„
Myer
26,050
17,925
„
Woolworths
2,955
3,750
„
Target
-
5,270
„
Coles
-
4,760
„
Greater Union
-
6,723
„ Specialties (sqm)
15,600
48,603
„ Car Park Spaces
1,000
3,200
(+312%)
35
Westfield Bondi – Pre Development
36
Land and Authorities
(
98
d 19
uire
q
c
A
)
ne
)
k La
Coo red 2000
qui
(Ac
(Acquired 1996)
ge
B r id
e
(Leas
e
quir
(Ac
d 19
d 199
9)
94)
(Acquired 1999)
37
Authorities
Dec – 1996
DA Application lodged
1997 – July
Application called in by Minister
May – 1998
DA Approved
1999 – July
DA Application Lodged For Carousel
Dec – 1999
DA Approved for Carousel
2000 – April
DA Lodged for Composite Development
Dec – 2000
DA Conditionally approved
2002 – April
Commenced Construction
38
Development
Background:
„ AMP wholly owned centre until 1994
„ Westfield approached for Redevelopment
expertise and became JV Partner 1994
„ Westfield Acquired additional 50% in 2001
„ Value of Centre pre-development
$ 212m
„ Redevelopment in 2004 approx cost
$ 755 m @ 7.60% Yield
„ Estimated Value of Centre
on Completion (2004) :
$1,220m
„ Approx Enhanced Value:
$ 253m
„ Current Value:
$ 1,869m
Westfield Bondi,
Bondi, Sydney, NSW Australia
39
BONDI – Sections
Section
Car Park
Retail 1
Retail 2
Retail 3
Retail 4
Retail 5
Retail 6
Level 13
Level 12
Level 11
Level 10
Level 9 GB’s
Level 8 GB’s
Cinema
Retail 6
Retail 5 Target
Retail 4 DJ’s
Retail 3 DJ’s
Retail 2 DJ’s
Retail 1 DJ’s
Level 7 GB’s
Level 6 GB’s
Level 5 Coles
Level 4
Level 3
Level 2
Level 1
Car Park
Proposed
Mall
Cinema
Specialty Shops
Cinema
David Jones
Target
Loading Dock/ Park
Lift
Amenities
Parking
ELP Shop
40
Retail Sales
FEASIBILITY
ON COMPLETION
CURRENT
FORECAST
(Dec 05)*
(Dec 08)
A$550m
A$754m
A$940m
$1,000
$940
$901
4.3%
Compound
Annual Growth:
7.6%
9.2%
$900
(A$000's)
$825
9.4%
$800
$754
$700
$600
2005
* 2005
2006
2007
2008
is the first full trading year post project completion
41
Retail Sales (contd.)
„
ON COMPLETION
CURRENT
(Dec 05)*
(Dec 08)
A$8,924
A$11,218
Specialty ($PSM)
$12,000
$11,218
$10,660
5.3%
Compound
Annual Growth:
7.9%
$11,000
MAT $PSM (A$'s)
10.5%
$9,647
$10,000
8.1%
$8,924
$9,000
$8,000
2005
2006
2007
2008
42
Westfield Bondi - Specialty Rent Growth
„
Specialty ($PSM)
Passing as at
On Completion
December 2004
December 2008
A$1,344
A$1,594
00
7.3%
00
Compound
Annual Growth:
4.4%
3.6%
00
3.5%
3.1%
00
00
00
2004
2005
2006
2007
2008
43
Senses Merchandising
- Atrium banner
44
Customer Services
„ Concierge
„ Valet Parking
„ Handsfree Shopping
45
Enhancement of Offer – Luxury Evolution
46
Shop 6007
Before
47
Shop 6007
After – Max Brenner
48
Shop 3031
Before – Mon Amour
Shop 3031
After – Ed Hardy (women's)
49
Shop 3079
Before
50
Shop 3079
After – Ed Hardy (men's)
51
Westfield Group
Australian Business Overview
- UBS Property Tour
March, 2009