September Introducing Habas Investments

Transcription

1 September 2011 Introducing Habas Investments

2 Disclaimer Certain matters discussed by Habas Investments in this presentation constitute forward-looking statements within the meaning of the securities laws. Although Habas Investments believes that the expectations reflected in such forward-looking statements are based upon reasonable assumptions, it can give no assurance that these expectations will be achieved. Factors that could cause actual results to differ materially from current expectations include changes in macroeconomic conditions and the supply and demand factors in the areas in which Habas Investments is active; the continuing financial success of Habas Investments current and prospective tenants; continuing supply constraints in its geographic markets; the availability of properties for acquisition; the success of its efforts to lease up vacant space; the effects of natural and other disasters; the ability of Habas Investments to successfully integrate the operations and systems of acquired companies and properties.

3 Operations in Israel, Western Europe and North America New York Amsterdam Zurich Tel Aviv szeke

4 A multinational group with a long family heritage 1953: Separation of the footwear and real estate business 1962: First major development project 1991: Built the Kfar Saba City Center 2004: Start of the Yoo Tel Aviv project 2010: Start of the real estate debt operation; Re-establishment of the US HQ 1900s 1910s 1920s 1930s 1940s 1950s 1960s 1970s 1980s 1990s 2000s 2010s 1908: Foundation of a leather trading business in Palestine 1930s: Purchase of land in what would later become major cities in Israel 1949: Foundation of the Jerusalem shoes factory - the largest in the Middle East 1975: Developed residential neighborhoods in Israel 1980s: Developed 1,000s of residential units, shopping centers in Israel 1993: TASE IPO of the public company* Acquiring shopping centers in the US : Re-established the European HQ with major investment s in Western Europe * One of the Habas Group companies

5 Habas Investments: three business segments DEVELOPMENT Large-scale projects where the group s skill and reputation can be leveraged to command a premium INCOME PRODUCING PROPERTIES Cash flow from NSI dividends and direct ownership of properties in WE and the U.S REAL ESTATE DEBT Combining real estate expertise with financial sophistication ROOTED IN DEEP REAL ESTATE EXPERTISE

6 Overview HABAS INVESTMENTS Division DEVELOPMENT INCOME PRODUCING PROPERTIES REAL ESTATE DEBT HQ Israel Netherlands US Netherlands Switzerland Properties Yoo Tel Aviv 1 Rothschild Caesarea Koresh NSI 19.3% Swiss portfolio German portfolio Purchase of B-notes and other CMBS tranches

7 Development

8 Careful selection of development projects Habas Investmetns probably sees every development opportunity in Israel, but only handpicks those where it can create a truly new reality in real estate far ahead of anyone else

9 Past development projects The Arim Mall with over 100 businesses created a new city center in Kfar Saba, an affluent suburb in the greater Tel Aviv area. Many years after completion, it still is among the top 10 shopping centers in Israel 1994 Combining quality construction with a high standard of living, the Country Neighborhood in Modi'in is one of the most successful residential projects in the newly established city situated between Tel Aviv and Jerusalem. 1998

10 Past development projects A 600 unit residential complex built to the highest quality standards in the heart of Kfar Saba, an affluent suburb in the greater Tel Aviv area Dan Eden is a luxurious residential project located in one of Tel Aviv's most desirable neighborhoods, Shikun Dan. 2004

11 The Group s recent flagship development projects The Yoo Tel Aviv towers were developed under design supervision of Philippe Starck. The project led the way in transforming a deserted waste land into one of the most exclusive neighborhoods in Tel Aviv, and was the first branded development project in Israel. Total sales were NIS 1.2bn Back in 2003, people were still wondering whether high net worth individuals would buy multimillion dollar apartments at 1 Rothschild in central Tel Aviv. Habas created the market. Total sales were NIS 800m

12 Future projects Vacation apartments and retail space with a view of either the Mediterranean Sea or the Caesarea international golf course. In advanced planning stages An attractive location in the heart of Tel Aviv near Rothschild Boulevard. The company is in the process of rezoning for hotel, residential and retail use. 2013

13 Income producing properties

14 NSI: a Dutch REIT - Space to Perform Financial profile Portfolio profile Assets 1.4bn Income producing properties Habas owns 19.3% and is the largest shareholder Market cap m Focus on Netherlands Hertzel Habas is the NSI Chairman of the Supervisory Board Annual revenues 103m B-class assets, A-class locations Habas receives tax benefit on NSI operating profit Annual NOI 89m 50/50 retail/office Habas can leverage NSI equity Current dividend yield 8-9% 150 mid-size properties Sustainable annual dividend

15 Following completion of the merger with VastNed Estimated Pro-forma profile of the combined entity* Portfolio mix 63% Offices 304 properties Industrial 6% 2.4bn assets Geographical focus Retail 31% 70% Netherlands #2 mixed use REIT in The Netherlands Germany / Switzerland 8% Dividend yield 9% Belgium 22% Combined equity of 900m * As stated in the NSI presentation from April 20 th 2011

16 Direct ownership of income producing properties in Western Europe - some examples The Dietikon City Plaza is a 12,700 sqm Class A office building in Dietikon, Switzerland, situated on Zurich's outer ring. The leading office building in the area, it has 6 tenants and a 100% occupancy rate. Built in 1992, renovated in 2000, Bad Homburg is a 10,000-sqm retail property located in a prime location near Frankfurt. The high-quality, distinctive property includes a 241-car parking lot. The property is rented out in its entirety to one tenant, Karstadt retailer chain for a period of 15 years with two 5-yr extension options, The Agy Shopping Center is located in Fribourg, Switzerland, south of Bern, it was built in 1999 and covers 11,140 sqm of retail space. The center, which is situated on the Route d'agy highway, is comprised of 13 stores and an underground parking lot with 370 spaces. The shopping center's anchor stores are Coop, one of Switzerland's two leading supermarket chains, and Media Markt, Europe's largest retailer of consumer electronics. The center is 99% occupied.,

17 Habas USA Established in May 2011 Focus on income producing properties with a value added risk profile

18 Real estate debt

19 A significant opportunity for Habas According to DTZ, the European Debt Funding Gap (between existing debt and debt available to replace it) for is $100bn+ It takes real estate expertise, not just financial expertise to separate the chaff from the wheat

20 Habas Loan-to-Own Strategy What a pure financial player sees Owner credit worthiness Loan details Property potential What Habas sees

21 A recent case example: Wankdorf Center (Bern) 2006 B-note Senior debt Equity CHF 65 m CHF 230 m The owner purchases the building financed by 2 loans Breach of LTV Covenant for the whole loan Wiped out The owner is in breach of the LTV covenant, despite that there are no problems with the property and its tenants payments and the loan is still performing. April 2011 Habas Buys for CHF 11.25m Wiped out Based on deep understanding of the property, Habas buys the b-note at a discount and offers the owners either to buy the property or do all the work to sell the property in return for a profit share May 2011 Habas recoups Habas Profit share Habas takes over managing all aspects of the deal for selling the property, with the owner s consent, making a CHF19m or 170% profit in 2 months

22 About

23 Shareholders Public 20% Odin Psagot* 5% 6% HABAS INVESTMENTS 39% Habas family Analyst* 7% 23% Ofer Management Group * Institutional investors

24 Senior management Ronen Akavia CEO Amir Nitzani CEO Habas Star Eyal Reggev CEO Habas USA Dafna Katzir VP Marketing & Sales Shachar Klein CFO

25 Board of Directors Yoseph Rozen Josef Habas Haim Barzel Zamir Sofer Shimon Mizrahi Izake Lotan Noya Habas Hertzel Habas Chairman Eithan Ben Eliahu

26 Revenues and net income NIS m H Development Income producing properties * Real estate debt Total revenues Net profit (34.1) *Including the expected dividend from NSI to be distributed in Q

27 Healthy balance sheet long debt duration NIS m, year end 2,597 2,597 Cash 197 Apartments for sale Other ST assets Land for building Properties Other ST & LT 721 2,007 liabilities 1,945 2,007 1, Bank loans* Other LT assets Debentures 455 Subsidiaries Equity %* 19%* 23%* Equity as % of total balance sheet H H ASSETS LIABILITIES * Mostly non recourse

28 Strong cash flow generation NIS m dividend Global financial crisis 146 Cash H Fin* Inv Ops Cash 2010 EOY Fin* Inv Ops Cash 2009 EOY Fin* Inv Ops Cash 2008 EOY * Includes forex adjustment ($-4m in 2009, $+2m in 2010)

29 Recapping

30 Recent developments Opened US headquarters Closed Wankdorf Center B-note deal NSI VastNed merger New asset purchases in Germany Opportunistic sale of properties in the Swiss portfolio New dividend policy: >25% of annual profits NIS 55m dividend distributed since January 2011

31 Recapping the investment opportunity Long-standing player in global real estate Broad international portfolio of properties and activities Strong financials and cash flow generation Strong growth prospects: - Development - Income producing properties - Real estate debt

32 Thank you