A R E T A I L R E A L E S T A T E C O M P A N Y I N V E S T O R P R E S E N T A T I O N N O V E M B E R 2 0 1 6
OVERVIEW MISSION & VALUES S&P 500 REAL ESTATE INVESTMENT TRUST (a) Own and operate best-in-class retail properties Headquarters Chicago that provide an outstanding environment and experience for our Communities, Retailers, Retail Properties 126 Employees, Consumers and Shareholders. States 40 CORE VALUES H – Humility • Inline & Freestanding GLA 55 million Total Retail GLA 124 million A – Attitude • NATICK MALL, NATICK, MA D – Do The Right Thing • Equity Market Cap $24.6 billion Enterprise Value $42.6 billion T – Together • O – Own It • Picture THE WOODLANDS MALL, HOUSTON, TX 2 a) As of September 30, 2016.
EXECUTIVE TEAM Marvin Levine, Sandeep Mathrani, Executive Vice President and Chief Executive Officer Chief Legal Officer Scott Morey, Michael Berman, Executive Vice President, Executive Vice President and Chief Technology Officer Chief Financial Officer Julie Knudson, Shobi Khan, Senior Vice President and Executive Vice President and Chief Human Resources Chief Operating Officer Officer Alan Barocas, Tara Marszewski, Senior Executive Vice President, Senior Vice President, Leasing Chief Accounting Officer Richard Pesin, Executive Vice President, Anchors, Development, and Construction 3
SUSTAINABILITY Commitment to environmental responsibility Awarded the 2015 Green Star and recognized as the North American leader in the Retail – Large Cap Sector by GRESB in 2014 2 0 1 5 I M P A C T A T A G L A N C E Top 10 U.S. company by solar Eliminated 23,200 metric tons of Diverted 54,300 tons of waste from capacity. landfills; enough waste to fill over carbon dioxide equivalents, taking 4,500 garbage trucks. 4,700 cars off U.S. roads. Reduced water consumption by 64 Since 2011, reduced electricity Upgrades to power saved 44.5 million gallons ; enough water to fill million kilowatt hours annually; consumption by 215.8 million almost 100 Olympic-size swimming kilowatt hours ; enough electricity equal to removing 4,200 homes pools. from the electrical grid. to power all the homes in Coral Gables, FL for one year. 4
DIGITAL INITIATIVES PARKING PRODUCT SEARCH 5
ANNUAL EBITDA GROWTH OF 4% TO 5% Contractual Fixed Increase in Rents + 2% - 3% Occupancy Growth Positive Releasing 1% Spreads Expense Growth (1%) Developments 1.5% Acquisitions 0.5% 6
LONG TERM DIVIDEND GROWTH FROM HIGH QUALITY CASH FLOWS HIGH QUALITY ASSETS Oter • 95% of NOI is derived from top 100 properties REVENUE MANAGEMENT Contractual Rent Bumps – In place rental revenue grows by 2-3% • through contractual rent bumps Occupancy & Rental Growth Rate- Approximately10% of leases • expire annually + 8-10% spreads = 1% growth EXPENSE MANAGEMENT Real Estate Tax Recovery - Largest expense is approximately 75% • recovered from tenants Sustainability Initiatives - Reduced utilities expenses via • sustainability initiatives such as lighting and HVAC upgrades, and solar power production 7
IRREPLACEABLE RETAIL REAL ESTATE IN THE U.S. Sales and NOI Contribution (a) Sales % of Company Top Retail Properties PSF (b) NOI (c) Top 10 $804 23% Top 30 $683 48% Top 50 $702 66% Top 100 $604 95% GGP owns 100 of the top 500 regional shopping centers in the U.S. a) Retail properties ranked by trailing 12 months NOI ending December 31, 2015. b) Sales per square foot for trailing 12 months ended December 31, 2015 for comparable tenants occupying space less than 10,000 square feet. 8 c) For 2015 YTD ending December 31, 2015.
HIGH QUALITY RETAIL PROPERTIES TOTAL U.S. RETAIL REAL ESTATE GLA GLA % of Total SF Per Capita (in millions) High Quality GLA High Quality (a) Regional Shopping Center GLA 495 1.6 40% High Quality (b) Open-Air Center GLA 732 2.3 60% Total High Quality Retail Real Estate 1,227 3.9 100% Quality Type Regional Shopping Centers 1.1 billion sf 3.4 sf per capita GGP owns 8.2% of all High Quality Retail Real Estate a) “High Quality” has been defined as a regional shopping center rated B+ or better by Green Street Advisors. b) “High Quality” has been defined as a Trade Area Power score of 75 -100 for strip centers, as rated by Green Street Advisors. 9
CHANGING THE VOCABULARY Services Restaurants Entertainment RETAIL REAL Sources of Demand ESTATE Grocery 10
REDEVELOPMENT OF ANCHOR BOXES Since 2011, 91 of 95 vacant department stores and boxes have been redeveloped for a total cost of $1.5 billion generating an 11% annual return. 18 department stores - Nordstrom (3), Von Maur (3), Macy’s (2), Boscov’s (2), Dillard’s • (2), Belk, Lord & Taylor, Bloomingdale’s, Carson’s, Bon Ton, and Target 14 entertainment venues - Dave & Buster’s (5), theaters (3), Round One (3), trampoline • parks (2), and Lucky Strike (1) 10 sporting goods stores – Dick’s Sporting Goods / Field & Stream (5), Sports Authority • (4), and Scheels (1) 7 fast fashion retailers - Forever 21 (5) and H&M (2) • 4 restaurants – Perry’s, Yard House, Old Town Pour House and Harry Caray’s • 5 grocery stores - Sprouts, Fresh Market, Wegmans, Save-a-Lot, and Total Wine • 3 fitness centers – 24 Hour Fitness, City Sports, and Family Fitness • 3 DSW • 4 Container Stores • 2 Pirch • 200,000 square feet of inline space including, but not limited to, Apple, Nike, Lululemon, • Tommy Bahama and Aritzia Other uses including, but not limited to, Nordstrom Rack, Saks Off Fifth, Crate& Barrel, • Petco, Ulta and HH Gregg 11 * Excludes boxes acquired from Macy’s and Seritage JV properties
RETAIL CATEGORY SHARE OF GLA Department Store % of Total Center Mini Majors % of Total Center GLA GLA 21% 17% 46% 13% 13% 15% 27% 23% 17% 15% Asia USA UK Australia Middle East Asia USA UK Australia Middle East Entertainment & Non Retail % of Specialty % of Total Center GLA Total Center GLA 16% 13% 45% 47% 11% 11% 36% 40% 8% 29% Asia USA UK Australia Middle East Asia USA UK Australia Middle East F&B % of Total Center GLA 15% 10% 8% 6% 6% Source: ICSC 12 Asia USA UK Australia Middle East
RETAILER DEMAND IS STRONG RETAILERS A'Gaci Charming Charlie's Hammermade Lou & Grey Peloton Sur la Table Z Gallerie Agent Christian Louboutin Louis Vuitton Zara Hanna Andersson Phillip Plein Tervis* Provocateur Havaianas Zegna Alex and Ani COS* Love Sick Pink Tempur-Pedic Cotton On lululemon Allen Edmonds Hot Topic Pirch Tesla Hugo Boss Polo The North Face Altar'd States Crayola* Lush Anthropologie David Yurman Ivivva MAC Prada Tiffany Apricot Lane David's Tea Jins Marbles Pressed Juicery Torrid Aritzia Dior John Hardy Marc Jacobs* Primark Tory Burch Sport Athleta Dry Goods Joie Massage Envy Rebecca Minkoff* Tumi Bally Dyptique* Kendra Scott Melissa Shoes Rebecca Taylor* Ulta Mitchell Gold + Restoration Bottega Veneta Escada Kiehl's Under 10* Bob Williams Hardware Box Lunch Fendi Kiko Cosmetics Muji Rue 21 Under Armour Bulgari Francesca's Kipling Nespresso* Saint Laurent Urban Outfitters Camper Frontgate* L’Occitane NYX Sephora Valentino Capital Teas Frye Boots* Lego Oakley Six:02 Vans Cartier Garage LL Bean Oliver Peoples* Soft Surroundings Vineyard Vines Walking Celine Givenchy* Lolli & Pops Other Stories* Splendid Company CH Carolina Gucci Longchamp* Pandora Suit Supply West Elm Herrera White Barn Chanel H&M Loro Piana Paul & Shark Superdry Candles 13 * Not currently within GGP’s portfolio
RETAILER DEMAND IS STRONG (cont’d) STRIP CENTER, POWER CENTER, BIG BOX, DINING, ENTERTAINMENT AMC Theatres Nando's Bar Louie Nordstrom Rack Blaze Pizza Red Robin Buffalo Wild Wings Regal Cinemas California Pizza Kitchen Ross Cheesecake Factory Round 1 Chipotle Seasons 52 Dave & Busters Shake Shack Dick’s Sporting Goods Smashburger Earl’s Sweetgreen Five Guys TJ Maxx Kona Grill Trader Joes Landmark Theatres Wegmans Longhorn Steak House Zinburger Lyfe Kitchen Main Event Entertainment Matchbox MOD Pizza* * Not currently within GGP’s portfolio 14
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