PRIMEVEST SMART CITY FUND IMPACT INVESTMENT IN SOCIAL INFRASTRUCTURE - - PowerPoint PPT Presentation

“PRIMEVEST SMART CITY FUND”

IMPACT INVESTMENT IN SOCIAL INFRASTRUCTURE

Utrecht, July 2018

WHY INVESTING IN THE PRIMEVEST SMART CITY INFRASTRUCTURE FUND?

• Cash Flows driven by essential communication services resilient to the economic cycle
• Urban areas increasingly depend on mobile communication infrastructure (5G) and the Internet of Things
• Assets with long economic life cycle & high barriers to entry
• SMART City infrastructure comprises SMART streetlights of which a part is connected to an inner-city fiber backhaul network (the latter referred to as SMART

Public Nodes)

• Average lifetime of SMART streetlights / SMART Public Nodes 20-35 years
• Long-term lease agreements with municipalities (minimum 15-20 years) that control city lighting and climate measurement
• Long-term stable cash flow return combined with upside potential
• Investing in SMART Lighting provides a long term stable cash return with (fixed revenues & fixed OPEX)
• Higher estimated return resulting from investing in further upgrade assets to SMART Public Nodes; extra revenues shared with municipalities
• Diversified end-user base reduces operator risk
• Higher risk-profile of the active and content & services business layers mitigated by only investing in the passive infrastructure components
• Open-access infrastructure model with diversified tenant base
• Impact investments with important social return
• Investors together with municipalities can play important role in realizing sustainability (Climate Treaty) & social responsibility targets
• Experienced international Primevest CP communication infrastructure team
• In depth fixed & mobile communication infrastructure experience
• Extensive network within local governmental organizations and technology partners in public domain

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ABOUT PRIMEVEST CAPITAL PARTNERS - HISTORY

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2017 2006 2001 FUTURE

Further growth on the back of existing strategy, business principles, policies and procedures, backed by a strong equity partner with long term investment horizon Management buy out of major parts of Bouwfonds IM supported by CommonWealth Investments Establishment of Bouwfonds IM Rabobank acquires Bouwfonds IM

ABOUT PRIMEVEST CAPITAL PARTNERS – PAN EUROPEAN PRESENCE

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We manage a portfolio of EUR 1.3 billion across Europe

€ 1.3 billion assets under management Activities in 10 countries in Europe Dedicated teams supported by local offices in the Netherlands and Germany Total staff of 35 employees based on existing funds & mandates

IRL 28M NL 505M UK 200M FR 101M ES 15M DE 264M FIN 28M NO 26M DEN 126M AUT 11M

STRATEGIC RATIONALE

FROM STREETLIGHT TO SMART PUBLIC NODE

INVESTMENT STRATEGY

OUR 3-STEP INVESTMENT APPROACH

NEXT STEPS

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A NEW ERA IN MOBILE COMMUNICATIONS BEGINS WITH THE ROLL-OUT OF 5G

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“As the telecommunications sector continues to build on the momentum of 2017, a new mobile era will emerge with the initial commercial rollout of fifth generation wireless network technology (5G). One of the most anticipated mobile technology platforms, 5G will be the connective tissue that blends nascent uses of mobile technology, such as the Internet of Things (IoT), autonomous vehicles, and mobile media, just to name a few”. Industry Outlook, Deloitte, 2018

CONVERTING 4G MOBILE NETWORKS TO 5G LTE NETWORKS REQUIRES EXTENSIVE EXPANSION OF INNER-CITY ACCESS POINTS…

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Introduction of 5G will transform the public space of cities:

• Up to 8 times more mobile access points in inner city areas
• Mobile access points placing needed every 500 - 800 meters

(versus 6.000 meters for 4G macro towers)

• Connection to sufficient electricity is needed (24/7 instead of

switched power grid)

• Connection to fiber fixed internet access is needed to deliver high-

bandwidth speeds

• Data transfer speeds up to 1 Gb/s (versus 50-100 Mb/s based on

4G networks)

…AND ACCELERATES THE GROWTH OF INTERNET OF THINGS BY CONNECTING OBJECTS IN THE INNER-CITY THROUGH SENSORS AND ANTENNAS

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1 BN. 22 BN. 50 BN.

1992 2018 2022

TO IMPLEMENT 5G AND CONNECTING OBJECTS IN THE PUBLIC DOMAIN, A MOBILE NETWORK INFRASTRUCTURE OF SMART PUBLIC NODES IS NEEDED

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What is a SMART PUBLIC NODE?

Like macro communication towers used for 4G, Smart Public Nodes are outdoor inner-city access points for mobile communication (5G & Wi-Fi) enabling at the same time connectivity for various devices including cameras, wireless broadband radios, and IoT sensors for SMART City applications and can be considered as an expansion of today’s mobile communications network

TODAY’S CITIES CONTROL MANY EXISTING OBJECTS WHICH CAN BE USED TO TRANSFORM INTO “SMART PUBLIC NODES”

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Existing public assets are crucial in the transition to a smart city and can be used as a ‘node’ between the new digital infrastructure, energy grids and end-user applications in a city

STREETLIGHTS ARE CONSIDERED TO BE THE MOST APPROPRIATE EXISTING OBJECTS TO CONVERT TO SMART PUBLIC NODES…

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• Density: 3.5 million streetlights in the Netherlands
• Accommodated with electricity
• Always close to communication infrastructure
• Elevation: makes it very suitable for antenna,

camera and sensor placement

• Modularity: physically expandable with equipment,

sensors, etc.

…SERVICING A BROAD RANGE OF POTENTIAL OF FUTURE SMART CITY APPLICATIONS…

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From single-purpose lighting to multi- purpose SMART Public Node

< Fiber > < Electricity transport network (3*25A) >

… BUT CITIES ARE ACTIVELY ASSESSING AN “OUTSOURCING MODEL” FOR THE PHYSICAL REPLACEMENT OF STREETLIGHTS OFFERING OPPORTUNITIES FOR (SEMI-) INSTITUTIONAL INVESTORS TO INVEST

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• Climate Treaty and End-of-life drive transition to SMART Lighting…
• the Dutch Government and cities agreed a binding Climate Treaty with the objective that 20% of total energy

consumption is from sustainable (renewable) sources and energy consumption is lowered by 20% by 2020 → implementing SMART Lighting is a top priority for cities & municipalities

• At the same time municipalities are implementing the new 'Omgevingswet' in 2019 by adding sensors (IoT) to the

smart lighting lamppost.

• replacement driven by physical or economical end-of-life of the streetlights (100.000 - 175.000> per year in NL)
• …whereas a combination of the lack of financial resources and knowledge & expertise drives the “outsourcing model”:
• Replacement and transition to ‘smart city’ to make the city more attractive go hand-in-hand to facilitate IoT sensors,

autonomous driving, EV-charging, WiFI in city hotspots, 5G mobile internet, security surveillance camera’s, etc.

• However, “smartization” requires specific expertise often not at hand and higher investment budgets (with already

many other tasks delegated to cities / municipalities requiring financial budget).

CONCLUSION: INVESTING IN LAMPPOSTS IS A SMART INVESTMENT

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Contributing to the necessary CO2 reduction… …and providing the infrastructure backbone for 5G & Internet of Things

STRATEGIC RATIONALE

FROM STREETLIGHT TO SMART PUBLIC NODE

INVESTMENT STRATEGY

OUR 3-STEP INVESTMENT APPROACH

NEXT STEPS

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INVESTMENT STRATEGY

SMART LIGHTING SMART Public Nodes SMART CITY

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Building-up a SMART City Asset Portfolio in 3 steps

STEP 1 STEP 2 STEP 3

Replacing traditional lampposts + implement new luminaires for SMART Lighting Long-term rent contract (20 years) for renting lampposts to city/municipality + renting related services (sensors, billboards) to private companies + fixed maintenance costs Upgrade approx. xx% of traditional lampposts to SMART Public Nodes for 5G + fiber/electricity to the lamppost and build inner-city fiber-ring Upgrade to SMART Public Nodes upon signed long term rent agreements with mobile

• perators + renting related additional

services (camera surveillance, EV charging) to municipality / private companies) Connecting homes and/or office/community buildings (libraries, schools, etc.) to the inner-city fiber-ring Expand inner-city fiber-ring by connecting new homes and/or buildings Type of investment Earnings model

STRATEGIC RATIONALE

FROM STREETLIGHT TO SMART PUBLIC NODE

INVESTMENT STRATEGY

OUR 3-STEP INVESTMENT APPROACH

NEXT STEPS

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PRIMEVEST HAS BUILT UP STRONG RELATIONSHIPS WITH MUNICIPALITIES, ECONOMIC BOARDS AND TECHNOLOGY PARTNERS….

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Acquisition pipeline

Municipalities Technology Partners Application Partners

… TO INTRODUCE THE PRIMEVEST’S “SMART CITY” BUSINESS PROPOSITION

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“Primevest Smart City Fund” Public & Private tenants Technology & Service partners

• Long-term rent agreements for

Smart lighting, Telecommunication (5G), Electric vehicle charging, Wifi, Camera surveillance, Billboards, etc.

• Infrastructure separated from

services

• Best-in-class technology partners for

maintenance

Smart City Asset Portfolio Rent agreements Supplier/partner agreements Investors

KEY STRENGHTS BUSINESS PROPOSITION - SUMMARY

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• 1. Open Business Model: long-term investments in open access infrastructure create an open

‘platform’ for a wide variety of revenue generating activities, with the benefit of cost-sharing across them.

• 2. The city as concessionaire and tenant for public functions: the city is concessionaire to the

business partners and tenant for public functions.

• 3. Revenue sharing & common objective to maximise utilisation: incentive for all parties to share
• pen access infrastructure as all parties can benefit from higher utilisation.
• 4. Operational strength: in a multi-tenant (partnership) framework, all partners (small or big, public or

private) work from their strength, delivering and maintaining their specific part of the smart city eco-system.

Multi-tenant business model reduces risk Incentive to maximise utilisation Operational strength & experience The city as reliable long- term tenant

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PRIMEVEST COMMUNICATION INFRASTRUCTURE TEAM (1)

HEIMEN VISSER

Heimen Visser (1972) joined the company in 2015. He has an extensive background of the past 16 years in the telecom and ICT sector. He worked for the Dutch incumbent telecom

• perator KPN Telecom, internet service provider Planet

Internet GmbH in Germany and Austria, for ICT company Getronics and Gemnet BV (the Dutch Government network company connecting 400 local government organizations to the central government for all vital public services in The Netherlands). He has experience in Sales, Business Development, Project management and Operations. Since 2012 he was overall responsible as Vice President for the Government segment of KPN servicing more than 1000 clients

• f KPN in The Netherlands with his team. Heimen has a title

Master of Law at the University of Leiden in The Netherlands

Fund & Acquisition Management

BAS VAN DONGEN

Bas van Dongen (1975) is responsible for managing the communication infrastructure activities and is fund manager

• f the Primevest Communication Infrastructure Fund (“PCIF”).

Prior to Primevest CP, Bas was Managing Director for Communication Infrastructure in Germany at Bouwfonds IM and member of the management team. In 2008, Bas was appointed as Head of Strategy & Marketing. In this role he was responsible for the strategy and positioning of Bouwfonds IM in the market. Prior to joining Bouwfonds, Bas acquired profound knowledge in the area of Corporate Finance and Mergers & Acquisitions at merchant bank Kempen & Co and Twynstra Gudde Corporate Strategy and

• Finance. Bas holds a Master degree in Business Economics

from Tilburg University, the Netherlands.

Fund Management

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PRIMEVEST COMMUNICATION INFRASTRUCTURE TEAM (2)

WALTER KUPPENS

Walter Kuppens (1959) has over 23 years’ experience in European real estate development. Walter is responsible for finance and risk management. He has been working consecutively for Ernst & Young (10 years), as a finance director for Multi Development Corporation (11 years) and as CFO for Foruminvest B.V., an European shopping centre

• developer. In the last 5 years Walter has been active as

interim-director for large Family Offices in the Netherlands. Walter studied accountancy (NOvAA) for small and mid-sized companies.

Partner Finance & Risk

• DR. PETER SELGERT

Acquisition & Asset Management (Germany) Peter Selgert (1952) is responsible for acquisition and asset management for the communication infrastructure funds in Germany. Prior to joining Bouwfonds IM in 2014, Mr. Selgert held various senior management positions in the communication industry as managing director or regional director sales & marketing at Technetix Ltd., C-COR Inc., Arris Inc. and Philips Broadband Networks for more than 15 years. Before he moved to the communication industry Mr. Selgert served as managing director at Philips Recordable Media GmbH in Wiesbaden, a subsidiary of Philips Consumer Electronics and as research scientist in the material science department of Hoechst AG. He graduated in physics Frankfurt University and holds a PhD in Physics. He successfully completed an executive education program at INSEAD.

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PRIMEVEST COMMUNICATION INFRASTRUCTURE TEAM (3)

JENS LOSSIN

Jens (1975) is responsible as senior fund analyst for the

• perational fund and risk management of PCIF as well as the

implementation of the investment strategy. Due to his more than 20 years of experience in banking, real estate (open and closed special funds) and investment, he will also take advantage of the optimization of his debt collection and liquidity management in his area of ​responsibility. His many years of expertise in fund, risk and financial management as well as Treasury, i.a. at the Berlin Hyp, Dexia, LB Immo Invest, HSH Real Estate, PATRIZIA GewerbeInvest. Jens Lossin has also held leading positions with and for telecommunications and infrastructure companies, i.a. Rail Power Systems and Balfour Beatty.

Fund Management PCIF

KLAUS LECKELT

Klaus Lecklet (1968), (Certified Real Estate Specialist, Telecommunications Engineer) has more than 20 years’ experience in the telecommunications industry. Mr. Leckelt held various senior management positions in the communication industry. As technical business manager and managing director for a Fiber network ISP he was responsible for project acquisition, market introduction of products and services and technical operations. Prior to this position he had various assignments as project manager and acquisition manager at national and international telecommunication service providers and system integrators. His area of expertise covers all areas of telecommunication networks and services including construction management and commissioning of PoPs and other communication network nodes. NN graduated in communications engineering and is a certified technical property expert and a certified Prince 2 Practioner. Next to his mother language German, he speaks fluently English, Spanish and French. .

Acquisition & Asset Management (Germany)