Q4-19 Investor Update (As of December 31, 2019)
Disclaimer/Forward-Looking Statements Statements made by us in this presentation and in other reports and ability to acquire additional real estate assets; continued high levels of, or statements released by us that are not historical facts constitute “forward- increases in, unemployment and a general slowdown in commercial activity; looking statements” within the meaning of Section 27A of the Securities Act our leverage and ability to refinance existing indebtedness or incur of 1933, as amended, and Section 21E of the Securities Exchange Act of additional indebtedness; an increase in our debt service obligations; our 1934, as amended. These for-ward-looking statements are necessarily ability to generate a sufficient amount of cash from operations to satisfy estimates reflecting the judgment of our senior management based on our working capital requirements and to service our existing and future current estimates, expectations, forecasts and projections and include indebtedness; our ability to achieve improvements in operating efficiency; comments that express our current opinions about trends and factors that foreign currency fluctuations; adverse changes in the securities markets; our may impact future operating results. Some of the forward-looking ability to retain our senior management and attract and retain qualified and statements may be identified by words like “believes”, “expects”, experienced employees; our ability to attract new user and investor clients; “anticipates”, “estimates”, “plans”, “intends”, “projects”, “indicates“, “could”, our ability to retain major clients and renew related contracts; trends in the “may” and similar expressions. These statements are not guarantees of use of large, full-service commercial real estate providers; changes in tax future performance and involve a number of risks, uncertainties and laws in the United States, Europe or Japan that reduce or eliminate our assumptions. Accordingly, actual results or the performance of Kennedy- deductions or other tax benefits; future acquisitions may not be available at Wilson Holdings, Inc. (the “Company”) or its subsidiaries may differ favorable prices or with advantageous terms and conditions; and costs significantly, positively or negatively, from forward-looking statements made relating to the acquisition of assets we may acquire could be higher than herein. Unanticipated events and circumstances are likely to occur. Factors anticipated. Any such forward-looking statements, whether made in this that might cause such differences include, but are not limited to, the risks report or elsewhere, should be considered in the context of the various that the Company’s business strategy and plans may not receive the level of disclosures made by us about our businesses including, without limitation, market acceptance anticipated; disruptions in general economic and the risk factors discussed in our filings with the U.S. Securities and business conditions, particularly in geographic areas where our business Exchange Commission (“SEC”). Except as required under the federal may be concentrated; the continued volatility and disruption of the capital securities laws and the rules and regulations of the SEC, we do not have and credit markets, higher interest rates, higher loan costs, less desirable any intention or obligation to update publicly any forward-looking loan terms, and a reduction in the availability of mortgage loans and statements, whether as a result of new information, future events, change in mezzanine financing, all of which could increase costs and could limit our assumptions, or otherwise. The information with respect to the projections presented herein is based on a number of assumptions about future events and is subject to significant economic and competitive uncertainty and other contingencies, none of which can be predicted with any certainty and some of which are beyond the company’s control. There can be no assurances that the projections will be realized, and actual results may be higher or lower than those indicated. Neither the company nor any of their respective security holders, directors, officers, employees, advisors or affiliates, or any representatives or affiliates of the foregoing, assumes responsibility for the accuracy of the projections presented herein. The modeling, calculations, forecasts, projections, evaluations, analyses, simulations, or other forward-looking information prepared by Property and Portfolio Research, Inc. (Licensor) and presented herein (the “Licensor Materials”) are based on various assumptions concerning future events and circumstances, all of which are uncertain and subject to change without notice. Actual results and events may differ materially from the projections presented. All Licensor Materials speak only as of the date referenced with respect to such data and may have changed since such date, which changes may be material. You should not construe any of the Licensor Materials as investment, tax, accounting, or legal advice. 1 Q4-19 INVESTOR UPDATE
Table of Contents Page Strategic Review 3 Financial Performance Review 15 Western US Markets 19 European Markets 28 Appendix 35 2 Q4-19 INVESTOR UPDATE
Overview Strategic Review 3 Q4-19 INVESTOR UPDATE
About Kennedy Wilson We are a leading global real estate investment company. We own, operate and invest in real estate through our balance sheet and through our investment management platform. We focus on multifamily and office properties located in the Western U.S., U.K., and Ireland. Office: 150 El Camino Multifamily: Radius Mixed-Use: Capital Dock Beverly Hills, CA, U.S. Seattle, WA, U.S. Dublin, Ireland 4 Q4-19 INVESTOR UPDATE
Kennedy Wilson (NYSE: KW) at a glance 1 $ 18 bn $ 421 m $ 95 m Estimated Annual IMRES AUM 2,4 2019 Fees 2,3 NOI 2 318 14 4.4 % $ 0.22 Total employees No. of offices Dividend yield 5 Quarterly Dividend 1 Information shown at share as of December 31, 2019 4 Includes $2bn related to property services 2 As defined in definitions section in the appendix 5 Based on annual dividend of $0.88 and share price of $20.17 on 2/20/20 3 Includes $17m of fees from property services 5 Q4-19 INVESTOR UPDATE
Key growth initiatives • Organic growth through value-add strategy and new Grow Property acquisitions 1 NOI • $105m of NOI from unstabilized and development assets by YE-2023 - $16M expected in 2020 Grow Investment • 2019: 39% increase in fee-bearing capital 2 Management • 2020: Targeting $1b in gross new fee-bearing capital Platform 6 Q4-19 INVESTOR UPDATE
The Kennedy Wilson Advantage Globally diversified real estate portfolio in growing 1 markets with complementary investment management platform Long-term relationships with major institutions 2 Local expertise to accretively allocate capital 3 First-mover advantage from early entry in key target 4 markets Proven 30-year track record as global real estate 5 investor and operator 7 Q4-19 INVESTOR UPDATE
Real Estate Portfolio and Value Creation Opportunities 8 Q4-19 INVESTOR UPDATE
Two key investment segments Investment Management Platform Balance Sheet Portfolio Commingled Fund Separate Account Multifamily: Atlas Office: 111 BPR Office: West Hills Multifamily: The Grange, Issaquah, WA, U.S. Victoria, London, UK Canoga Park, CA, U.S. South Dublin, Ireland • Complementary platform generating recurring • Permanent capital vehicle focused on asset management fees and promotes maximizing property cash flow • Primary investors include: • Targeting investments with accretive • insurance companies asset management opportunities • public and private pension plans • Longer-term hold period • family office and private equity clients 9 Q4-19 INVESTOR UPDATE
Excellent scale across multifamily and office 79% Multifamily & Office Sectors Geography Multifamily: 46% Western US: 51% $ 421 m $ 421 m Office: 33% UK: 24% Retail: 14% Ireland: 21% Estimated Estimated Hotel & Italy & Spain: 4% Annual NOI 1 Industrial: 7% Annual NOI 1 319 29,705 22.0 m 93.7 % No. of assets No. of multifamily Commercial Area (sq ft) 3 Occupancy 4 units 2 1 As defined in definitions section in the appendix 4 Stabilized multifamily and commercial assets only and excludes unstabilized 2 Includes 550 unstabilized units and 3,816 units under development assets 3 Includes 2.0m sq ft of unstabilized assets and 0.9m sq ft under development 10 Q4-19 INVESTOR UPDATE
Development and leasing pipeline to add ~$105m in NOI By YE-2021 2022-2023 +$34m +$70-73m Stockley Park , UK Kona Village Resort , Kona, Hawaii Grange , Dublin Clancy Quay Phase III , Dublin 8 Leisureplex , Co. Dublin Coopers Cross , Dublin The Clara , Boise, ID Hanover Quay , Dublin 2 One Westlake , Thousand Oaks, CA 11 Q4-19 INVESTOR UPDATE The scope of these projects are subject to change.
NOI delivery from completion of development & future leasing +$105m in Est. Annual NOI by 2023 $49 $50 $40 $28 $30 $22 $18 $20 $16 $11 $10 $21 $10 $12 $11 $9 $4 $0 2020 2021 2022 2023 US Europe 12 Q4-19 INVESTOR UPDATE
Investment Management Platform 13 Q4-19 INVESTOR UPDATE
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