2Q20 PARQUE ARAUCO INVESTOR PRESENTATION Important disclaimer This - - PowerPoint PPT Presentation

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2Q20 PARQUE ARAUCO INVESTOR PRESENTATION Important disclaimer This - - PowerPoint PPT Presentation

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PARQUE ARAUCO INVESTOR PRESENTATION Investor Presentation Parque Arauco 2Q20 PARQUE ARAUCO INVESTOR PRESENTATION Important disclaimer This document has been prepared by Parque Arauco for the purpose Contacts of providing general information

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SLIDE 1 PARQUE ARAUCO INVESTOR PRESENTATION

2Q20

Investor Presentation Parque Arauco

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SLIDE 2 PARQUE ARAUCO INVESTOR PRESENTATION

Important disclaimer

This document has been prepared by Parque Arauco for the purpose
  • f providing general information about the Company. The Company
assumes no responsibility for, or makes any representation or warranty, express or implied, with respect to, the accuracy, adequacy
  • r completeness of the information contained herein. The Company
expressly disclaims any liability based on such information, errors therein or omissions therefrom. This presentation includes certain statements, estimates and forecasts provided by the Company with respect to it’s anticipated future performance and involves significant elements or subjective judgment and analysis that may or may not prove to be accurate or
  • correct. There can be no assurance that these statements, estimates
and forecasts will be attained and actual outcomes and results may differ materially from what is estimated or forecast herein. The information contained herein has been prepared to assist interested parties in making their own evaluation of the company and does not purport to be all - inclusive or to contain all the information that a potential counterparty may desire. In all cases, interested parties should conduct their own independent investigation and analysis of the Company. Interested parties can
  • nly rely on the result of their own investigation and the
representations and warranties made in any definitive agreement that may be executed. 2

Contacts

Tori Creighton (Head of Investor Relations) Francisco Moyano (Corporate Finance Manager) Claudio Chamorro (CFO) Tel: (562) 22990510 | Email: ir@parauco.com

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SLIDE 3 PARQUE ARAUCO INVESTOR PRESENTATION

Contents

3 → Parque Arauco at a glance

→ Purpose, Mission & corporate strategy

INTRODUCTION

→ Chilean portfolio

→ Peruvian portfolio → Colombian portfolio

OUR OPERATIONS

→ Investment highlights

→ Stability → Diversification

INVESTMENT HIGHLIGHTS

→ Future developments

→ Landbank → Glossary

FUTURE DEVELOPMENTS

→ Geographic presence: assets and formats → Parque Arauco iconic and dominant shopping centers → Growth → Sustainability & Corporate governance

→ Financial strength centers

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SLIDE 4 PARQUE ARAUCO INVESTOR PRESENTATION

Introduction

→ Parque Arauco at a glance → Purpose, Mission & corporate strategy → Geographic presence: assets and formats → Parque Arauco iconic and dominant shopping centers

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SLIDE 5 PARQUE ARAUCO INVESTOR PRESENTATION

Parque Arauco at a glance

Parque Arauco is a real estate company dedicated to the development and operation of mixed- used properties in the Andean region.

OWNERSHIP STRUCTURE (JUNE 2020)

17

Regional shopping centers

10

Neighborhood shopping centers

7

Outlets

21

Strip centers Offices, medical centers, hotels

9 55 → Real estate assets

in Chile, Peru and Colombia

FINANCIAL INDICATORS (June 2020)

1,077,000 m2

→ Gross Leasable Area (GLA)

US$ 211 million

→ Consolidated revenue LTM

US$ 138 million

→ EBITDA LTM

65,4%

→ EBITDA margin LTM

US$ 3,594 million

→ Assets

US$ 1,018 million

→ Net financial debt CONTROLLING GROUP FOREIGN INVESTMENT FUNDS LOCAL BROKERS LOCAL PENSION FUNDS OTHER SHAREHOLDERS FAMILY SAID YARUR FAMILY ABUMOHOR LOCAL MUTUAL FUNDS

25% 24% 19% 14% 8% 5% 3% 2%

5

25% 5% 3% 21% 16% 16% 12%

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SLIDE 6 PARQUE ARAUCO INVESTOR PRESENTATION

2014 2015 2016 2019

6

Between 2014 and 2019, Parque Arauco has nearly doubled in GLA, NOI and AFFO

1982

Parque Arauco Kennedy

  • pens as first shopping

center in Chile.

1995

Parque Arauco S.A. IPO

2006

Parque Arauco expands into Peru with the purchase of a 45% stake in MegaPlaza Norte in Lima.

2010

Parque Arauco opens first mall in Colombia, Parque Arboleda in Pereira

2011

Capital increase for US$145 MM Capital increase for US$182 MM Purchase of minority shareholders in Colombia and Peru Capital increase for US$100 MM Parque Arauco achieves full operational control of Peruvian operation with purchase of Wiese Group minority interest.

+1.5x +1.3x +1.3x

GLA (m2) NOI (US$ MM) CONTROLLED ADJUSTED FFO (US$ MM)

69 78 87 106 119 142 92 2014 2015 2016 2017 2018 2019 LTM 2Q20 117 136 154 181 192 211 155 2014 2015 2016 2017 2018 2019 LTM 2Q20 728,500 818,500 947,000 1,012,0001,053,0001,075,5001,077,000 2014 2015 2016 2017 2018 2019 2Q20
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SLIDE 7 PARQUE ARAUCO INVESTOR PRESENTATION

Our essence

7 We are experts in developing and operating gathering places where people interact, connect, spend time together and share their

  • interests. We create dynamic assets that evolve with life styles and
integrate with their surroundings to create hubs of urban and social development.
  • We are responsible in our
treatment of and conduct towards all people: employees, tenants, customers and communities.
  • We value everyone’s
contribution without distinction.
  • We are environmentally
responsible.
  • We seek creative solutions.
  • We (always!) want to surprise
internal and external customers.
  • We are open to learning and
continuous improvement.
  • We follow the rules.
  • We behave ethically and honestly,
even in challenging contexts.
  • We lead by example.
  • We fulfill our commitments.
  • We act with professionalism,
excellence and a sense of urgency.
  • We mobilize to meet our
challenges.
  • We all contribute to creating a
great place to work.
  • We establish trust-based
relationships.
  • We do everything with passion.
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SLIDE 8 PARQUE ARAUCO INVESTOR PRESENTATION

Our operations

→ Chilean portfolio → Peruvian portfolio → Colombian portfolio

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SLIDE 9 PARQUE ARAUCO INVESTOR PRESENTATION

Chilean portfolio

9

  • 1. Includes 18 strip centers located in: Santiago (13), Viña del Mar (1), Calama (1), Coquimbo (1) and Antofagasta (1).
  • 2. Includes four premium outlets located in Santiago, Concepción, Coquimbo and Curauma.
  • 3. Current
ently, , Arauco Quilicura is predominant antly y closed, d, and withou hout a determined ned opening date, as a result of the social al protest ests s in Chile. . PARQUE ARAUCO KENNEDY ARAUCO MAIPÚ

8

Regional shopping centers

1

Neighborhood shopping centers

4

Outlets

18

Strip centers

31

Real estate assets

517,000 m2

Total Gross Leasable Area (GLA)

Format Year incorporated Total GLA (m2) Ownership (%) Owned GLA (m2) Occupancy (%) Parque Arauco Kennedy Regional Shopping Center 1982 110,500 100.0% 110,500 98.8% Arauco Maipú Regional Shopping Center 1993 75,000 100.0% 75,000 98.7% Arauco Chillán Regional Shopping Center 2007 35,500 51.0% 18,105 93.6% Arauco Estación Regional Shopping Center 2008 67,000 83.0% 55,610 93.4% Arauco San Antonio Regional Shopping Center 2009 28,500 35.7% 10,175 95.6% Arauco Express1 Strip Centers 2012 40,500 51.0% 20,655 89.6% Arauco Premium2 Outlets 2012 50,000 100.0% 50,000 87.4% Arauco Quilicura3 Regional Shopping Center 2013 32,000 51.0% 16,320
  • Arauco Coronel
Regional Shopping Center 2017 30,000 51.0% 15,300 96.2% Parque Angamos Neighborhood Shopping Center 2018 10,500 55.0% 5,775 82.5% Arauco El Bosque Regional Shopping Center 2018 30,000 51.0% 15,300 95.5% Puerto Nuevo Antofagasta Strip Center 2019 6,500 100.0% 6,500 73.0% Total Chile 516,000 77.4% 399,240 94.5%
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SLIDE 10 PARQUE ARAUCO INVESTOR PRESENTATION

Peruvian portfolio

10

  • 1. InOutlet and Viamix includes two premium outlets in Lima and three strip centers in Lima.
MEGAPLAZA NORTE LARCOMAR

6 9 2

Outlets

3

Strip centers

20

Real estate assets

405,500 m2

Total Gross Leasable Area (GLA) Regional shopping centers Neighborhood shopping centers

Format Year incorporated Total GLA (m2) Ownership (%) Owned GLA (m2) Occupancy (%) MegaPlaza Norte Regional Shopping Center 2006 112,000 100.0% 112,000 98.2% MegaPlaza Express Villa Chorrillos Neighborhood Shopping Center 2009 8,000 100.0% 8,000 98.3% Larcomar Regional Shopping Center 2010 26,500 100.0% 26,500 82.7% Parque Lambramani Regional Shopping Center 2010 30,000 100.0% 30,000 92.5% MegaPlaza Chimbote Regional Shopping Center 2012 28,000 100.0% 28,000 96.2% MegaPlaza Express Villa El Salvador Neighborhood Shopping Center 2012 9,000 100.0% 9,000 96.8% MegaPlaza Express Chincha Neighborhood Shopping Center 2013 10,500 100.0% 10,500 95.5% MegaPlaza Cañete Regional Shopping Center 2013 26,000 100.0% 26,000 93.6% MegaPlaza Express Barranca Neighborhood Shopping Center 2013 16,500 100.0% 16,500 99.7% InOutlet (Premium Outlets) and Viamix (Strip Centers)4 Outlets / Strip Centers 2013 10,000 100.0% 10,000 91.8% MegaPlaza Express Pisco Neighborhood Shopping Center 2015 15,000 100.0% 15,000 94.2% El Quinde Cajamarca Regional Shopping Center 2015 33,000 100.0% 33,000 96.5% El Quinde Ica Regional Shopping Center 2015 36,500 100.0% 36,500 98.5% MegaPlaza Express Jaén Neighborhood Shopping Center 2016 14,500 100.0% 14,500 97.4% MegaPlaza Huaral Neighborhood Shopping Center 2017 14,500 100.0% 14,500 96.6% MegaPlaza Villa El Salvador II Neighborhood Shopping Center 2017 15,500 100.0% 15,500 95.5% Total Perú 405,500 100.0% 405,500 95.7%
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SLIDE 11 PARQUE ARAUCO INVESTOR PRESENTATION

Colombian portfolio

11

3

Regional shopping centers

4

Real estate assets

154,500 m2

Total Gross Leasable Area (GLA)

1

Outlets

PARQUE LA COLINA Format Year incorporated Total GLA (m2) Ownership (%) Owned GLA (m2) Occupancy (%) Parque Arboleda Regional Shopping Center 2010 40,500 55.0% 22,275 96.6% Parque Caracolí Regional Shopping Center 2013 38,500 100.0% 38,500 89.7% Parque La Colina Regional Shopping Center 2016 62,000 100.0% 62,000 95.9% Arauco Premium Outlet Bogotá (Sopó) Outlet 2017 13,000 100.0% 13,000 64.1% Total Colombia 154,000 88.2% 135,775 91.9%
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SLIDE 12 PARQUE ARAUCO INVESTOR PRESENTATION

Investment highlights

→ Stability → Diversification → Growth → Sustainability & Corporate governance → Financial strength centers

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SLIDE 13 PARQUE ARAUCO INVESTOR PRESENTATION 16% 84% Top ten Other tenants

14% 86%

Variable rental revenues Fixed rental revenues 0% 28% 72% Parking Other revenues Rental revenues

REVENUE BREAKDOWN (Based on % of revenues 2Q20) CONTRACT LENGTH (Based on % of revenues LTM) TENANT REVENUE (Based on % of revenues LTM)

Stability

Revenue type and contract duration

13

weighted average length of rental contracts Our rental revenues are derived primarily from fixed contracts and are protected against inflation. Our top 10 tenants represent only 15% of Parque Arauco’s total revenue.

16.0 % 5.8 years

<2 years 2-3 years 3-4 years 13% 100% 40% 10% 37% >4 years Total

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SLIDE 14 PARQUE ARAUCO INVESTOR PRESENTATION

14

  • Note: Same Store Sales and Same Store Rent for the fourth quarter 2019 and first quarter 2020 do not include Arauco Quilicura since the majority of the mall is closed due to incidents related to the social crisis in Chile
  • SSS
SSS and SSR in the second nd quar arter er consi sider er tenant ants that opened d to the public or sold via deliver ery at least one day during ng the period.
  • d. Furthermor
  • re,
e, the methodol
  • lgy was adjust
sted ed from a month to month comparison son to one that include des s the sales s and m2 with h sales s of the entire e quarter.

SAME STORE SALES (SSS) AND SAME STORE RENT (SSR) (%) OCCUPANCY COST (%)

Stability

Consistent same store growth and healthy occupancy cost

Chile Peru Colombia

10.6 11.4 10.4 11.3 11.0 11.4 10.5 11.6 7.0 2Q18 3Q18 4Q18 1Q19 2Q19 3Q19 4Q19 1Q20 2Q20 7.2 7.4 6.8 8.3 7.6 7.9 7.5 8.2 3.5 12.7 13.2 10 10 13.9 12.5 11.9 9.9 14.5 14.1
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SLIDE 15 PARQUE ARAUCO INVESTOR PRESENTATION
  • 70%
  • 60%
  • 50%
  • 40%
  • 30%
  • 20%
  • 10%
0% 10% jun.-19 sept.-19 dic.-19 mar.-20 jun.-20
  • 1
  • 0,5
0,5 1 1,5 jun.-19 sept.-19 dic.-19 mar.-20 jun.-20 BCU 5Y BCU 10Y

Diversification

15

RETAIL SALES2 (YOY Var.%)

Parque Arauco operates in three different economies

INTEREST RATES4

4.0%

2018 GDP 2020f GDP

  • 1. Figures correspond to International Monetary Fund estimates for 2020.
  • 2. Source: National Chamber of Commerce’s Business Report for the Metropolitan Region (Chile); National Institute of Statistics and Information’s Technical Report on National Production (Peru); National
Administrative Department of Statistics’ Monthly Survey on Retail and Vehicle Trade (Colombia).
  • 3. Source: Bloomberg.
  • 4. Interest rates for Chile are in real terms whereas Peru and Colombia’s are nominal terms.

→ Population1: 18.9 million people → Inflation Projection 20203: 2.9% → GDP Projection 20203: -6.1% (2019: 1.1%)

Chile Peru Colombia

→ Population1: 32.8 million people → Inflation Projection 20203 : 1.5% → GDP Projection 20203 : -9.5% (2019: 2.2%) → Population1: 50.9 million people → Inflation Projection 20203 : 2.9% → GDP Projection 20203 : -4.9% (2019: 3.3%)

5 10 jun.-19 sept.-19 dic.-19 mar.-20 jun.-20 PEN 5Y PEN 10Y
  • 50%
  • 40%
  • 30%
  • 20%
  • 10%
0% 10% 20% jun.-19 sept.-19 dic.-19 mar.-20 jun.-20
  • 60%
  • 50%
  • 40%
  • 30%
  • 20%
  • 10%
0% 10% jun.-19 sept.-19 dic.-19 mar.-20 jun.-20 2 4 6 8 10 Jun-19 Sep-19 Dec-19 Mar-20 Jun-20 COGR 5Y COGR 10Y
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SLIDE 16 PARQUE ARAUCO INVESTOR PRESENTATION Chile Peru Colombia 20 14 18 Revenues/m2 (US$) Chile Peru Colombia 103 192 63 Sales/m2 (US$)

Diversification

16

  • 1. In MUS$ using the following exchange rates: US$1= CLP 794.43 US$1= PEN 3.47, US$1= COP 3702.69.
  • 2. Including overhead expenses (Corporate headquarters, regional Services Center, Chile Division, Peru Division and Colombia Division)

GLA (M2) COUNTRY LEVEL REVENUES1 (MMUS$ LTM) TENANT SALES1 (MMUS$ LTM) COUNTRY LEVEL EBITDA 1, 2(MMUS$ LTM)

Results have been positive in all three countries in the last twelve months

Total: 1,077,000 m2 Total: MMUS$ 2,071 Total: MMUS$ 228 Total: MMUS$ 334

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SLIDE 17 PARQUE ARAUCO INVESTOR PRESENTATION Neighborhood 6% Outlet 7% Strip Center 4% Regional 83%

17

FORMAT LEVEL DIVERSIFICATION (Based on % of revenues LTM) SOCIO-ECONOMIC DIVERSIFICATION (Based on % of revenues LTM)

Diversification

Parque Arauco diversifies its market risks at a country, format, and socio-economic level

Medium-low 7% Medium-high 43% Medium 50%
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SLIDE 18 PARQUE ARAUCO INVESTOR PRESENTATION 30.4% 17.8% 11.4% 27.4% 12.8% 0.3% 22.4% 29.2% 22.0% 18.5% 6.9% 1.0% 22.2% 4.2% 16.4% 48.8% 8.1% 0.4% 26.3% 20.3% 16.0% 26.8% 10.0% 0.5% Chile Peru Colombia Consolidated 18

GLA BY CATEGORY

Diversification

Departament Stores Home improvement & supermarkets Food & entertainment Specialized retail Mixed-use & services Others

4

→ Office towers, corresponding to 13,200 m2

21

→ Gyms, dance studios, sports centers

+530

→ Food and beverage locals ENTERTAINMENT

24

→ Movie theaters

50

→ Children’s entertainment areas

11

→ Cultural centers FOOD & BEVERAGES MIXED-USE SERVICES

+200

→ Financial and other services

3

→ Education spaces

23

→ Clinics and healthcare centers, corresponding to 19,200 m2

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SLIDE 19 PARQUE ARAUCO INVESTOR PRESENTATION

19 39 293 125 139 241 275 152 185 110 2Q20 2019 2018 2017 2016 2015 2014 2013 2012 Greenfields and expansions

72%

Minority interest

20%

M&A

9%

WACC Spread Over WACC Cap Rate 3% 8% 5%

TOTAL INVESTMENT (MMUS$)* VALUE CREATION SPREAD

Growth

Parque Arauco’s investment history

Parque Arauco is a real estate company dedicated to the development and
  • peration of mixed-used properties in the Andean region.

Our approximate value creation spread

*Using the following exchange rates: US$1= CLP 794.93. M&A considers cash flows used for acquiring subsidiares or other businesses. Minority interests considers cash flows used for acquiring non-controlling interests, other payments to acquire joint ventures, and payments from changes in ownership interests in subsidiaries that do not result in a loss of control. Greenfields and landbank includes purchase of other long-term assets. This does not include other investments, including interests received, purchases of property, plant and equipment, purchases of intangible assets, dividends received, and other inputs (outputs) of cash.

1,559 2020

→

3%

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SLIDE 20 PARQUE ARAUCO INVESTOR PRESENTATION

20

TOTAL RETURN, LAST 5 YEARS ANNUALIZED (Local currency)

Total return

Parque Arauco’s value creation is proven by the fact that it has had one of the highest “Total Return” of the real estate sector in the last years.

TOTAL RETURN, LAST 10 YEARS ANNUALIZED (Local currency)

Growth

Source: e: Bloomberg 1. Total return includes des dividen dends ds as of March h 31, 2019. 9.

11% 10% 8% 7% 6% 2% 0%

  • 3% -7% -8% -9% -10%-13%
  • 29%-30%
  • 63%
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16

28% 14% 10% 9% 8% 4% 4% 3% 3% 0%

  • 2% -5% -8% -10%
  • 37%
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 1 S&P 500 Index 9 Fibra Uno Administracion SA de 2 IRSA Inversiones y Representaciones 10 Taubman Centers Inc 3 Iguatemi Empresa de Shopping C 11 SACI Falabella 4 Multiplan Empreendimentos Imob 12 Klepierre SA 5 Parque Arauco SA 13 Simon Property Group Inc 6 BR Malls Participacoes SA 14 Macerich Co/The 7 S&P/CLX IPSA CLP TR 15 Hammerson PLC 8 Cencosud SA 16 Intu Properties PLC 1 IRSA Inversiones y Representaciones 9 Simon Property Group Inc 2 S&P 500 Index 10 S&P/CLX IPSA CLP TR 3 Parque Arauco SA 11 SACI Falabella 4 Iguatemi Empresa de Shopping C 12 Cencosud SA 5 Multiplan Empreendimentos Imob 13 Macerich Co/The 6 Taubman Centers Inc 14 Hammerson PLC 7 BR Malls Participacoes SA 15 Intu Properties PLC 8 Klepierre SA
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SLIDE 21 PARQUE ARAUCO INVESTOR PRESENTATION

21

E-COMMERCE SALES OVER TOTAL RETAIL SALES1 (%)

Innovating in a new business environment

E-COMMERCE SALES GROWTH1 (%)

Growth

8.5 9.3 10.3 11.6 13.3 13.7 1.3 1.6 1.9 2.4 3.2 3.7 2013 2014 2015 2016 2017 2018 USA Chile, Perú, Colombia 15.0 11.6 14.1 13.4 13.1 13.3 26.0 23.3 23.5 26.8 32.7 37.5 2013 2014 2015 2016 2017 2018 USA Chile, Perú, Colombia 0.4 1.2 3.0 0.9
  • 1.6
  • 0.5
3.7 2.5 1.2 1.2 1.5 1.3 2013 2014 2015 2016 2017 2018 USA Chile, Perú, Colombia

BRICK AND MORTAR SALES GROWTH 1 (%) Digital Directories New webpages New WiFi Smart parking Customer journey redesign App development INTERNET USE FOR ONLINE SHOPPING AND BILL PAYING2 (%)

77 49 30 12 7 United States China Chile Colombia Peru

PARQUE ARAUCO IS INVESTING IN TECHNOLOGY

1. Source: Eurmonitor, December 2018 2. Source: Global Findex 2017 (WorldBank)
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SLIDE 22 PARQUE ARAUCO INVESTOR PRESENTATION

ROOM FOR GROWTH IN EMERGING ECONOMIES1

Parque Arauco participates in countries with growing retail markets

Growth

RETAIL MARKETS IN CAPITAL CITIES1

50 100 150 200 250 300 500 1000 1500 2000 2500 GLA per 1,000 inhabitants GDP / GLA 50 100 150 200 250 300 500 1000 1500 2000 2500 GLA per 1,000 inhabitants GDP / GLA 1. Source: International Council of Shopping Centers, World Bank, The Brooking Institution, CoStar, Alphawise, CASC, CapitalLand Mall Trust, Japan Council of Shopping Centers, Mexico (CBRE), Brazil (ABRASCE), Peru (ACCEP), Morgan Stanley Research

22

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SLIDE 23 PARQUE ARAUCO INVESTOR PRESENTATION 31

The following are some of the most recent initiatives that we have developed in order to better the service and experience offered to our clients both inside and outside

  • f the mall, as well as strengthen our role in the omnichannel shopping environment.

ARAUCO PICK UP – PARQUE ARAUCO KENNEDY

Arauco Pick Up has already started its operation in Parque Arauco Kennedy. Aiming to deliver an innovative service amidst the new scenario faced by the country, we created Arauco Pick Up, a system that allows online shopping and pick up in the mall’s parking area, avoiding delivery

  • costs. And, customers never even have to leave

their car. It is a click-and-collect service on a shopping mall level, in which orders can be placed from a variety participating stores, picking them up in the express parking área dedicated to Arauco Pick-Up. This will favor social distancing, helping upkeep our customers’ and employees’ health, alongside reducing delivery times.

GASTRONOMIC DELIVERY- COLOMBIA

Our shopping centers, Parque La Colina, Parque Arboleda and Parque ue Caracolí, have started offering food delivery ry from participating mall restaura

  • urants. Custome

mers rs can order from the restaura urants via a a call center and get a t taste of their favorite dining spots at home.

TICKETLESS PARKING – PARQUE ARBOLEDA & PARQUE LA COLINA

We expanded the smart parking facilities to Parque La Colina and Parque Arboleda. With the help of a mobile app, shopping mall clients will be able to pay the parking through their phones (thus avoiding queues in traditional payment booths) or given the ability to subscribe to our “ticketless” payment, which uses a license plate reading in order to automatically register

  • payments. These solutions support the series of

measures implemented to prevent the spread of Covid-19, but also ultimately make for a better shopping experience.

PERSONAL SHOPPER - LARCOMAR

Geared toward end consumers, we launched a Personal Shopper initiative in Larcomar, which will facilitate “remote” shopping at a distance in

  • Larcomar. This personal shopper will be able to

assist in purchasing products available in

  • Larcomar. The client will just send a Whatsapp

message to the Personal Shopper, indicating which products they want to purchase, or making the Personal Shopper look for them. Our Shopper will then send all available options and

  • nce the client chooses, he/she will be able to

pay and receive the product to their doorstep through an external delivery company.

UPDATE: RAPPI COLOMBIA ALLIANCE

This alliance between Rappi Colombia and Parque La Colina was established in late 2019, but it has been heightened due to the pandemic, with sales increasing up to four times compared with months before the

  • pandemic. We already have more than 30 food and non-

food brands.

Innovation & Digitalization

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SLIDE 24 PARQUE ARAUCO INVESTOR PRESENTATION

DOW JONES SUSTAINABILITY INDEX DJSI Emerging Markets, DJSI MILA and DJSI Chile SUSTAINABILITY YEARBOOK 2020 The only Chilean real estate company included on S&P Global’s annual report

  • n leading companies in sustainability.

INDUSTRY MOVER Recognizes us as the company that made the most progress on sustainability practices in our industry over the last year. FTSE4GOOD The London Stock Exchange’s Sustainability

  • Index. For the second straight year, we were
listed on the Emerging Markets and Latin American indexes. GRESB PUBLIC DISCLOSURE Global Real Estate Sustainability
  • Benchmark. Organization that conducts
annual assessments of ESG practices for the global real estate industry. INSTITUTIONAL INVESTOR 2019 Latin America Executive Team First place in the Best CFO category and second place for Best IR, Best IR professional, Best ESG and Best Website. INFORME REPORTA CHILE Seventh place among 29 IPSA companies in study of the quality of information provided to shareholders and stakeholders. GREAT PLACE TO WORK Great Place to Work Institute Ninth among the best places to work in Chile and 18th in Colombia. ENERGY EFFICIENCY SEALS Ministry of Energy and Chilean Energy Sustainability Agency Arauco Maipú: Gold Seal Arauco Coronel, Parque Arauco Kennedy, Arauco Estación: Bronze Seal

Awards and recognition

23

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SLIDE 25 PARQUE ARAUCO INVESTOR PRESENTATION

Sustainability management

We created our sustainability agenda on the basis of inputs received from interaction with our stakeholders, as well as analysis of industry best practices and the issues with the greatest impact on our
  • business. Likewise, we consider standards
and international performance indicators
  • n ESG (environmental, social and
corporate governance) matters as well as alignment with each of the areas we are addressing through the United Nations Sustainable Development Goals (SDG). The Sustainability Area presents a quarterly report to the Board of Directors on the progress in these action areas and established priorities. There are periodic
  • pportunities to meet with the senior
executives and business leaders to ensure alignment, integration and organization- wide monitoring of the metrics and indicators established for each sustainability action area.

Our sustainability agenda

  • Road map for climate change and
managing our carbon footprint
  • Renewable energy consumption
  • Reuse and efficiently use water
  • Increase waste recycling
  • Implement sustainable design and
construction criteria
  • Timely outreach with neighboring
communities
  • Support emerging entrepreneurship
  • Promote sustainable practices in
the value chain
  • Integrate with the environment and
take action toward an inclusive culture
  • Be recognized for our labor
practices
  • Promote good corporate
governance practices
  • Identify and manage our risks in a
timely manner (S&S)
  • Strengthen our values-based
culture
  • Report our performance to our
stakeholders in a transparent, timely manner 24
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SLIDE 26 PARQUE ARAUCO INVESTOR PRESENTATION

25

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SLIDE 27 PARQUE ARAUCO INVESTOR PRESENTATION

Fixed 97% Variable 3%

June 2020

UF 68% PEN 15% COP 7% CLP 8% USD 2%

Jun June 2020

Financial strength

LIABILITY AMORTIZATION PROFILE AND DURATION (US$ MM)1

Conservative debt structure

5.4 years

Debt duration

5.8 years

Rental contract length

Feller and ICR

Local rating in Chile (as of June 2020) SUMMARY OF DEBT BY CURRENCY SUMMARY OF LIABILITY STRUCTURE SUMMARY OF DEBT RATES

Source: Parque Arauco
  • 1. Does not include accrued interests and the exchange rate is at the close of June 30, 2020.

AA

26

66 250 148 173 198 128 6 12 154 189 32 42 39 38 38 39 39 40 34 33 15 8 6 4 4 3

Bonds 57% Loans 43% Leasing 0%

June 2020

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SLIDE 28 PARQUE ARAUCO INVESTOR PRESENTATION

DATE: 10/12/2016 BASE: 1.46% SPREAD: 1.02% RATE: 2.48% DURATION: 12.71

  • 0,5
0,0 0,5 1,0 1,5 2,0 2,5 3,0 3,5 4,0 Generic AA Chilean Bond (Duration 15 years) Central Bank of Chile Interest Rate

Financial strength

The cost of debt has decreased importantly in the past 5 years

DATE: 04/17/2015 BASE: 1.62% SPREAD: 1.68% RATE: 3.30% DURATION: 14.77 DATE: 08/30/2018 BASE: 1.59% SPREAD: 0.75% RATE: 2.34% DURATION: 8.9

Parque Arauco has access to the debt markets in Chile, Peru and Colombia

Between 2012 and 2020, the real cost of debt for Parque Arauco has decreased 158 basis points from

4.1% to 2.5%

DATE: 04/22/2020 BASE: -0.10% SPREAD: 2.30% RATE: 2.20% DURATION: 4.7 DATE: 06/18/2020 BASE: 0.00% SPREAD: 1.50% RATE: 1.50% DURATION: 8.9

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SLIDE 29 PARQUE ARAUCO INVESTOR PRESENTATION

0.81 1.15 1.18 1.21 1.21 1.30 1.56 2014 2015 2016 2017 2018 2019 2Q20 0.47 0.76 76 0.72 72 0.77 0.66 0.66 0,72 2014 2015 2016 2017 2018 2019 2Q20 4.25 5.87 5.88 5.54 5.19 5.09 7.63 2014 2015 2016 2017 2018 2019 2Q20 3.31 3.33 3.04 3.42 3.76 3.76 2.57 2014 2015 2016 2017 2018 2019 2Q20 29

FINANCIAL INDICATORS (as of December of each year)

Financial strength

LIABILITIES / EQUITY (times) NET FINANCIAL DEBT / EQUITY (times)1 EBITDA/FINANCIAL EXPENSES (times) NET FINANCIAL DEBT / EBITDA (times) <1.5

1. This is Parque Arauco S.A.’s only covenant.
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SLIDE 30 PARQUE ARAUCO INVESTOR PRESENTATION

Future developments

→ Future developments → Landbank → Glossary

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SLIDE 31 PARQUE ARAUCO INVESTOR PRESENTATION

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Andrés Torrealba Country Manager, Chile Division

“The Parque Arauco Kennedy expansion project converts the company’s iconic shopping center into a mixed-use asset. As of year-end 2019, we had made considerable progress, completing the parking spaces, connecting tunnels and up to the sixth floor of the building—a very important milestone.”

PHASE 1 The expansion will add 11,000 m2 of commercial GLA to Parque Arauco Kennedy through construction of the Falabella chain’s flagship store and additional retail space. Furthermore, it involves construction of a 5-star, 401- room Hilton hotel by Hilton and the largest hotel convention center in Santiago, with capacity for more than 2,800 people in 3,000 m2. It also includes two restaurants, three bars, two pools, a gym, an executive lounge and another 700 parking spaces.

Parque Arauco Kennedy expansion

New projects

Format: Mixed use Commercial GLA: 11,000 m2 + Hotel (40,000 m2) + Convention center (3,000 m2) Ownership: 100% Total investment: US$ 187 million Construction began: 2017 Scheduled to open: Under review PHASE 2 The second expansion phase at Parque Arauco Kennedy was announced in 2018. It includes a 14-story tower and 10,000 m2 of additional commercial GLA at its base. Format: Mixed use Commercial GLA: 10,000 m2 + Tower GLA: 15,000 m2 Ownership: 100% Total investment: US$ 76 million Construction began: Under review Scheduled to open: Under review
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SLIDE 32 PARQUE ARAUCO INVESTOR PRESENTATION

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Eduardo Pérez CEO Parque Arauco Internacional

“This project, in association with important local real estate players, Ospinas & Cía. and Grupo Pegasus (co-founders of Colvalor), marks our arrival in

  • ne of Colombia’s four main

cities.” Parque Alegra

Format: Regional Shopping Center Location: Barranquilla, Colombia GLA: 50,000 m2 Parque Arauco’s ownership interest: 52.5% Total investment: US$ 116 million Construction began: 2019 Scheduled to open: Under review

New projects

This new shopping center with approximately 50,000 m2 of leasable area is being built on the south side of the city of Baranquilla, on the avenue that runs to the city’s northern side and to the airport. It is expected to be the leading shopping center on Barranquilla’s south side. Department store: Falabella Supermarket: Olímpica Cinema: Cine Colombia Children’s play area: PlayLand
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SLIDE 33 PARQUE ARAUCO INVESTOR PRESENTATION New projects Type Country Format Opening date Total GLA (m2) Ownership % Parque Arauco
  • wned GLA (m2)
Total investment Local currency1 Total investment MUS$2 Parque Alegra Development Colombia Regional Under review 50,000 52.5% 26,250 433,000 116 Subtotal 50,000 26,250 116 Expansions Type Country Format Opening date Total GLA (m2) Ownership % Parque Arauco
  • wned GLA (m2)
Total investment Local currency1 Total investment MUS$2 Parque Arauco Kennedy - Phase 1³ Expansion Chile Regional / Hotel Under review 11,000 100% 11,000 5,355,000 187 Parque Arauco Kennedy - Phase 24 Expansion Chile Regional / Tower Under review 10,000 100% 10,000 2,200,000 76 Larcomar Reconversion Peru Regional 1H21 3,000 100% 3,000 13,000 4 Parque La Colina - Bogotá Design Reconversion Colombia Regional 4Q20 500 100% 500 2,700 1 Subtotal 21,000 21,000 268 Acquisitions Type Country Format Opening date Total GLA (m2) Ownership % Parque Arauco
  • wned GLA (m2)
Total investment Local currency1 Total investment MUS$2 Puerto Nuevo Antofagasta (Balmaceda Tower, Hotel Tower) Development Chile Strip center 2H20 (Tower), TBD (Hotel) 3,000 100% 3,000 250,000 9 Subtotal 3,000 3,000 9 Projects incorporated in 2019 Type Country Format Incorporation date Total GLA (m2) Ownership % Parque Arauco
  • wned GLA (m2)
Total investment Local currency1 Total investment MUS$2 Arauco Premium Outlet Buenaventura (Remaining) Expansion Chile Outlet 1Q20 1,000 100% 1,000
  • Arauco Express Chicauma
Development Chile Strip center 2Q20 500 100% 500 2,000 0.1 Subtotal 1,500 1,500
  • Total
75,500 51,750 393 Remaining to invest 232

New projects

  • 1. Projects in Chile in UF, Peru in ThPEN, in Colombia in MCOP.
  • 2. Using exchange rates as of June 30, 2020: 28,695.46 CLP/UF, 821.30 CLP/USD, 3,755.83 COP/USD, 3.54 PEN/USD.
  • 3. In addition to the 11,000 m2 of GLA, the expansion includes a 401-room Hilton by Hilton and the largest hotel convention center in Santiago.
  • 4. This project also includes a 15,000 m2 tower.

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SLIDE 34 PARQUE ARAUCO INVESTOR PRESENTATION

Name m2 Ownership % Total cost (local currency)1 Total cost (in MUS$)2 Quilicura 25,486 100% 78,000 3 Buenaventura 115,864 100% 455,000 16 Chicureo 47,614 100% 206,000 7 Los Andes 39,254 100% 117,000 4 San Pedro de la Paz 17,002 100% 51,000 2 Total Chile 245,220 100% 907,000 32 Chimbote 42,657 100% 18,000 5 Talara 30,675 100% 9,400 3 Ica 12,643 100% 13,500 4 Chiclayo 6,609 100% 6,300 2 Pomalca Chiclayo 45,042 100% 6,565 2 Lambayeque- MegaPlaza 25,260 50% 18,900 5 San Juan de Lurigancho- MegaPlaza 80,000 50% 10,415 3 Otros MegaPlaza 106,157 50% 85,685 22 Total Peru 349,043 70% 168,765 46 Neiva 49,537 100% 22,000 6 Valledupar 46,000 100% 30,000 8 Barranquilla 56,166 100% 59,000 16 Total Colombia 151,703 100% 111,000 30 Total 745,966 86% 108

As of June 30, 2020

Land bank

  • 1. Land bank in UF (Chile), MPEN (Peru) and MCOP (Colombia).
  • 2. Using exchange rates as of June 30, 2020: 28,695.46 CLP/UF, 821.30 CLP/USD, 3,755.83 COP/USD, 3.54 PEN/USD.

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SLIDE 35 PARQUE ARAUCO INVESTOR PRESENTATION

35

Glosary

ADJUSTED FFO MARGIN: AFFO / revenues. AFFO: Adjusted Funds From Operations: Net Profit Depreciation & Amortization - Other Income/expenses - Share of Profit (Loss) of Associates Accounted - Foreign Exchange Differences - Income (Loss) for indexed assets and liabilities - Gains (losses) from the difference between the previous book value and the fair value of financial assets - Deferred tax+ Associates accounted Adjusted FFO. CONTROLLING ADJUSTED FFO: AFFO attributable to the shareholders
  • f the company.
CONTROLLING FFO: FFO attributable to the shareholders of the company. EBITDA: Earnings Before Income Tax Depreciation and Amortization: Revenues + Cost of Sales + Administration Expenses - Depreciation and Amortization EBITDA margin -EBITDA divided by revenues EPS: Earnings Per Share: Net income attributable to the equity holders of the company/weighted average number of shares
  • utstanding.
FFO: Funds From Operations: Net Profit - Depreciation & Amortization - Share of Profit (Loss) of Associates Accounted + Associates Accounted FFO. GLA: Gross Leasable Area. Equivalent to the sum of all the areas available for lease. GREENFIELD PROJECTS: Organic development of new shopping centers. LANDBANK: Land held by the company for future development LTM: Refers to information from the last twelve months. MONTHLY REVENUES/M2 : Monthly revenues divided by revenue- generating GLA during the month. MONTHLY SALES/M2: Monthly tenant sales divided by salesgenerating GLA during the month. NEIGHBORHOOD MALL: A shopping mall with a GLA between 6,000 and 20,000 m2. NET INCOME MARGIN: Net profit / revenues NOI: Net Operating Income: Revenues + Cost of Sales + Administration Expenses - Depreciation & Amortization + Associates accounted NOI. OCCUPANCY: GLA paying rent divided by total GLA OCCUPANCY COST: Minimum rent, plus variable rent, plus common expenses, plus a promotion fund that the tenants pay Parque Arauco divided by the sales of the tenant. OWNED GLA: Total GLA weighted by Parque Arauco’s interest in the mall. PIPELINE: Greenfield and expansion projects under development. PREMIUM OUTLET: Shopping center located outside of the city
  • ffering name brand clothing and goods for a reduced price.
REGIONAL MALL: A shopping mall with a GLA over 20,000 m2. SSR : Same Store Rent: Percentage change in rent collected from tenants that paid rent in both of the periods compared. SSS : Same Store Sales: Percentage change in sales from tenants that reported sales in both of the periods compared. STRIP CENTER: A shopping center with a GLA less than 6,000 m2. TENANT SALES : Sales of the consolidated assets. UF: Unidad de Fomento: A chilean currency unit indexed according to inflation on a daily basis.
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SLIDE 36