2015 Retail Investor Conference slides 2015

2015 INVESTOR CONFERENCE
Land Securities Retail
Scott Parsons
Managing Director, Retail Portfolio
2
Agenda
Scott Parsons – overview
Jat Sahota – customers and consumers
Polly Troughton – portfolio review
Scott Parsons – Bluewater
Q&A
Tour of Bluewater
Bluewater, Kent
3
Key themes
 Delivering strategy - Dominance,
Experience and Convenience
 Best in class portfolio positioned
to outperform
 Understanding the changing needs
of retailers and consumers
 Industry leader in leisure
and catering
 Decisive - risk aware
not risk averse
St David’s, Cardiff
4
Tackling a challenging market
Increasing
polarisation
between winners
and losers
Pace
of change
in customer
and consumer
requirements
Rigorous asset
management
is critical
5
Seismic change
Land Securities Retail*
Proportion of capital value - March 2012 vs. March 2015
£m
3,200
2,800
2,400
2,000
1,600
1,200
800
400
0
33.6% 40.1%
21.7% 14.9%
18.2% 17.8%
2012 2015
Dominant
shopping
centres
2012 2015
Retail
warehouse
and foodstores
2012 2015
Central London
retail
8.3%
8.3%
2012 2015
London suburb
centres
8.1%
18.9%
2012 2015
Leisure
and hotels
10.1%
0%
2012 2015
Secondary
centres
* Includes Central London retail
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The right space in the right place...
Scotland
£0.7bn
Northern
£1.8bn
Southern
£5.1bn
Southern region
Suburban London
Central London
Total
£2.6bn
£1.1bn
£1.4bn
£7.6bn
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Decisive capital allocation
 Secondary asset sales
The Bridges, Sunderland
Bluewater, Kent
Fountain Park, Edinburgh
Westgate, Oxford
 Investing in dominance
•
•
•
•
Leisure
Bluewater
Development
Asset enhancement
8
Land Securities Retail
Jat Sahota
Head of Commercial, Retail
9
Disposable income – the engine of retail growth
(%) growth YoY
5
4
3
2
1
0
-1
-2
-3
-4
-5
2005
2006
GDP
2007
2008
2009
2010
Household spending
2011
2012
2013
2014
Employment growth
2015
2016
2017
2018
2019
Real disposable income
Source: PMA
10
Changes in consumer behaviour…
The considered
consumer
Researchers
and influencers
The store
is still king
…continue to drive structural change in retail
11
The right space in the right place...
Bluewater, Kent
Trinity, Leeds
Bishop Centre, Taplow
White Rose, Leeds
…can dominate the catchment
12
Beyond catchment – shopper missions
Destination led
Locally driven
Purpose driven
 Leisure dominated trip
 Convenient grocery shopping
 Single item pick-up
 Pair/single doing
 Local neighbourhood
 Weekly grocery shop
a big shop
shopping
 The necessary evil
 Window shopping
 Killing time
 Friends browsing
 Convenient leisure
 The big ticket shop
 Family day out
 Friends big day out
55%
UK average: value of mission type
5%
40%
Source: CACI Shopper Missions 2014/2015 off peak
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We know what consumers value
Retail mix
Food options
Customer journey
Entertainment
14
Technology – helping consumers where it matters
 Understanding consumer priorities
 Planning, parking, wayfinding
 Offers and rewards
 Keeping close to innovation
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Rewarding consumers for loyalty
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Keeping close to future innovation
Other partners
Example companies
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Our consumers stay longer and spend more
Dwell time
Retail spend
85 mins
£84
Catering spend
Frequency
£13
57 visits
63 mins
£60
£10
45 visits
Land Securities portfolio average
UK average
Source: Year-to-date Land Securities survey data, CACI Shopper Dimensions
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Shopping centre sales densities (£ psf)
Sales densities growing year-on-year
7.4%
4.7%
Q3 2013
Q4 2013
Q1 2014
Land Securities fashion
Q2 2014
Q3 2014
Land Securities catering
Q4 2014
Q1 2015
Q2 2015
Sales densities growth
12 months ending
June 2015 vs 12 months
ending June 2014
Land Securities portfolio
Source: Land Securities portfolio average
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Summary
 Dominant shopping centres capturing high spending missions
 Understanding consumer priorities... for access, comfort, experience
and relevant technology
 Schemes that retailers want to be in
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Land Securities Retail
Polly Troughton
Head of Portfolio, Retail Parks and Leisure
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Key areas
1
2
Retail parks
Leisure and hotels
Convenience assets
fulfilling consumers’
convenience shopping trips
Expertise driving rental growth
4
3
Suburban London
Shopping centres
Strong growth potential and
mixed use development opportunities
Dominance, Experience
and Convenience
22
Focusing on convenience parks
Foodstores
Shopping Parks
Convenience Parks
23
Retail parks – convenience, resilience and liquidity
Key characteristics matrix
Catchment
Dominant
Strong trading location
Growing population
Property fundamentals
Flexible planning
Affordable rent
Flexible building design
Ample car parking
Refurbished elevations
Supermarket right size
and rent
Liquidity
Lot size <£80m
WAULT >7 years
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Strong trading locations... flexibility for retailer needs
Consolidate and release space
Discount retailers drive footfall and rental value
First UK location of new retailers
F&B in every park
Vacancy rates low and falling. WAULT 9 years
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Driving capital value and income
Goodmayes
Retail Park,
Chadwell Heath
Blackpool Retail Park,
Blackpool
Greyhound Retail Park,
Chester
The Peel Centre,
Bracknell
Kingsway West Retail Park,
Dundee
Bishop Centre,
Taplow
Lindis Retail Park,
Lincoln
Every asset has a plan
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Developing the right space in the right place
Worcester Woods, Worcester
Selly Oak, Birmingham
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Leisure driving strongest ERV growth
 Strength and depth of the market
 Increasing leisure spend
 Specialist leisure team
 Strong restaurant demand
Xscape, Yorkshire
Xscape, Milton Keynes
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Restaurant expansion driving rental growth
Restaurants ERV growth – March 2013 to March 2015
+27%
+37%
+19%
+15%
+31%
Bentley Bridge,
Wolverhampton
Boldon
Leisure Park,
Boldon
Cardigan
Fields,
Leeds
Cambridge
Leisure,
Cambridge
Cornerhouse,
Nottingham
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Focus on consumer experience... driving footfall
Xscape, Yorkshire
Xscape, Milton Keynes
30
London Retail... >£2.4bn in the UK’s engine room
Great North Finchley,
North Finchley
8.2 acres
Ealing Filmworks,
Ealing
2.2 acres
O2 Centre,
Finchley Road
9.2 acres
W12 Shopping Centre,
Shepherd’s Bush
5.8 acres
Odeon Cinema,
Camden
1.2 acres
Southside Shopping
Centre, Wandsworth
14.9 acres
Lewisham Shopping
Centre, Lewisham
7.9 acres
Shopstop,
Clapham
2.0 acres
Central London shops
Victoria, Piccadilly Lights,
One New Change
>50 acres in suburban London
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Maximising Crossrail opportunity
Ealing Filmworks, London
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New leisure and residential quarter in the heart of Ealing
Ealing average house prices
£600,000
£550,000
£500,000
£450,000
£400,000
£350,000
£300,000
2009 2010 2011 2012 2013 2014 2015E 2016E 2017E 2018E 2019E
Source: Nationwide
Source: Savills
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Creating places... making waves
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Dominance, Experience and Convenience
35
Creating a new shopping and leisure destination
Westgate, Oxford
36
Strong leasing momentum
 £440m TDC – £220m Land Securities’ share
 Innovative leasing strategy
 33% pre-let
Westgate, Oxford
37
Expanding F&B and strengthening retail mix
St David’s, Cardiff
38
Loyalty and leisure. Incubate and innovate
39
Sales density growth adding value to turnover rent
Optimising
tenant mix
Reconfiguration
and relocation
Consumer
experience
Gunwharf Quays, Portsmouth
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Summary
 Focusing on convenience retail parks
 Unique leisure expertise driving rental values
 Exploiting the London market
 Shopping centres in the right place with the right space
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Bluewater
Scott Parsons
Managing Director, Retail Portfolio
42
Bluewater... best of the best
£897m
Total annual sales
174 mins
Dwell time
94%
Conversion rate
6.6m
Affluent catchment
+4.8%
Calendar YTD sales
+1.7%
Calendar YTD footfall
43
A magnet for new brands
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Potential new
leisure/adventure/
experience zone
Planning
permission
for new hotel
New 60,000
sq ft MSU
in negs.
Enhanced
destination
dining quarter
MSUs – existing,
underway
and potential
Existing retailers
upgrading fitout
Ability to
add
additional
parking
Future potential
Upsize
completed last
year
Upsize
Terms
agreed for
upsized MSU
Potential
additional
MSU
New leisure &
catering zone
(former Glow)
6,250
new homes
Revitalised
leisure and
public realm
45
Wealth of success stories
46
Glow... optimising the leisure opportunity
Before
After
Bluewater, Kent
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Summary
 Best in class portfolio... compelling destinations, strong growth locations,
asset management and development upside
 Industry leader in leisure and catering
 Deep understanding of customer and consumer needs
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Important notice
This presentation may contain certain ‘forward-looking’ statements. By their nature,
forward-looking statements involve risk and uncertainty because they relate to future
events and circumstances. Actual outcomes and results may differ materially from any
outcomes or results expressed or implied by such forward-looking statements.
Any forward-looking statements made by or on behalf of Land Securities speak only as of
the date they are made and no representation or warranty is given in relation to them,
including as to their completeness or accuracy or the basis on which they were prepared.
Land Securities does not undertake to update forward-looking statements to reflect any
changes in Land Securities’ expectations with regard thereto or any changes in events,
conditions or circumstances on which any such statement is based.
Information contained in this presentation relating to the Company or its share price, or the
yield on its shares, should not be relied upon as an indicator of future performance.
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Notes
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Notes
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Notes
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