Gazit Globe Dec 2012 Investor Presentation

Gazit-Globe | Company Presentation | December 2012

A GLOBAL REAL ESTATE PLATFORM

LOCATION LOCATION LOCATION

Disclaimer

2

This presentation may include forward-looking statements, including forecasts, evaluations, estimates and other information relating to future events and issues. Forward-looking statements may relate to, among other things, revenues, earnings, cash flows, capital expenditures and other financial items. Forward-looking statements may also relate to our business strategy, goals and expectations concerning our market position, future operations, profitability, liquidity and capital resources. All statements other than statements of historical facts are forward-looking statements and can be identified by the use of forward-looking terminology such as the words "anticipate", "believe", "could", "estimate", "expect", "intend", "may", "plan", "predict", "project", "will" and similar terms and phrases. Any forward-looking information contained in this presentation is based, in addition to existing information of the company, on present company expectations and evaluations regarding future developments and trends and on the interaction of such developments and trends. Although we believe the assumptions upon which any forward-looking statements are based are reasonable, any of these assumptions could prove to be inaccurate and the forward-looking statements based on these assumptions could be incorrect. Our business and operations involve risks and uncertainties, many of which are outside our control, and any one of which, or a combination of which, could materially affect our results of operations and whether the forward-looking statements ultimately prove to be correct. Forward-looking statements are based on current expectations and are not guarantees of future performance. Actual results and trends in the future may differ materially from those suggested or implied by any forward-looking statements in this presentation depending on a variety of factors including those described in greater detail in our Periodical and Annual Reports, Registration Statement on Form F-1, Annual Report on Form 20F and in other information we file and furnish with the Israel Securities Authority and the Securities and Exchange Commission, including under the heading “Risk Factors.” All written and oral forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by the previous statements. Except for any obligations to disclose information as required by applicable securities laws, we undertake no obligation to update any information contained in this presentation or to publicly release the results of any revisions to any statements that may be made to reflect events or circumstances that occur, or that we become aware of, after the date of this presentation. The information contained herein does not constitute a prospectus or other offering document, nor does it constitute or form part of any invitation or offer to sell, or any solicitation of any invitation or offer to purchase or subscribe for, any securities of Gazit-Globe Ltd. or any other entity, nor shall the information or any part of it or the fact of its distribution form the basis of, or be relied on in connection with, any action, contract, commitment or relating thereto or to the securities of Gazit-Globe Ltd.


Listed on the Tel-Aviv Stock Exchange (TASE: GLOB) & New York Stock Exchange (NYSE: GZT)

Focused on supermarket-anchored shopping centers

NIS 77.4 billion ($US 19.8 billion) in assets under management, over 600 properties

Approximately NIS 6.9 billion ($US 1.75 billion) in annual rent, more than NIS 18 million per day

6.6 million sqm of GLA, approximately 15,000 lease agreements

Approximately NIS 280 million in annual dividend for 2013, NIS 1.72 per share (Approx. $ 0.44)

Domestic Credit Rating: Aa3 Stable (Midroog, Moody’s subsidiary), ilA+ Stable (S&P Maalot)

A Global Real Estate Platform

3

LOCATION

LOCATION LOCATION

Based on consolidated numbers including Atrium

Numbers in USD are presented based on the exchange rate as of September 30, 2012 of 1 USD = 3.912 NIS

(TSX: FCR) 45.6%

(TASE: GLOB, NYSE: GZT)

Think Global, Act Local

(NASDAQ OMX: CTY1S) 48.6% (NYSE: EQY) 45.5% (VSX/Euronext: ATRS) 34.5% (*)

(TASE: DORI) 55.4%

100% 100% 75% 100%

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As of September 30, 2012

(*) The Company has a shareholders’ agreement with CPI, a real estate fund that is part of the Apollo Global Real Estate Management L.P.

Group that holds, to the best of the Company’s knowledge, approximately 19.4% of the share capital of ATR

1.0 4.4

10.6

15.6

21.0

27.0

44.4

38.3

55.2 57.2

70.8

77.4

1991 1998 2000 2002 2004 2005 2006 2007 2008 2009 2010 2011 Q3 2012

Total Assets (NIS billions)

Since 2007, the Company’s financial statements are prepared in accordance with the IFRS. Based on IFRS, investment property is presented at fair value

Up & Running Growth Engine

5


http://www.dori.co.il/language.html

Div

iden

d P

er S

har

e (N

IS)

CAGR 11.2%

Demonstrated Long-Term Value Creation

6

Consistent & Growing Dividends for Over a Decade

(*) Data from January 2000 to November 2012


0

200

400

600

800

1,000

31-Dec-99 31-Dec-00 31-Dec-01 31-Dec-02 31-Dec-03 31-Dec-04 31-Dec-05 31-Dec-06 31-Dec-07 31-Dec-08 31-Dec-09 31-Dec-10 31-Dec-11

Gazit-Globe TA-100 S&P EPRA Global

Average Annual Return of Approximately 18% from 2000

0.39 0.47 0.57 0.64 0.71 0.76

0.89 1.00 1.08

1.24 1.42 1.48 1.56 1.60

1.72

0.00

0.50

1.00

1.50

2.00

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 E

7

Tel Aviv

Warsaw

Sao Paulo

Boston

New York

Los Angeles

San Francisco Bay Area Prague

Toronto

Global Strategy, Business Focus, High Growth Potential

Stockholm Tallinn

Miami

Rio Grande do Sul


8 Westbury Plaza , Long Island, NY, USA

Strong Urban Locations with High Barriers to Entry

9 Serramonte Shopping Center, San Francisco, USA

Strong Demographics in High Growth Markets

10

Necessity Driven Asset Class

The Biewind & Tupper Buildings, Tufts Medical Center Campus, Boston, USA

11 Leaside Village, Ontario, Toronto, Canada

Development & Redevelopment

12 Palac Flora, Prague, Czech Republic

Achieving Market Dominance & Economies of Scale

13

Repositioning of

Properties

Property &

Adjacent Land

Acquisition

Redevelopment

of All/Part of the

Retail Shopping

Centers

New

Tenants

&

Anchor

Tenants

Expanding

Existing

Properties

Proactive Asset Management

13


14

Development & Redevelopment

Cost to Complete

(NIS millions)

Total Investment

as of September 30, 2012

(NIS millions)

Number of Assets

Region

1,228 3,465 33 North America

385 469 5 Europe

(*) 137 1 Brazil

5 36 1 Israel

1,618 4,107 40 Total

Investments in development and re-development of more than NIS 9.0 billion over the past 5 years

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(*) The project is in the planning stage and has yet to be approved by the authorized organs of the Company

15

Investment

opportunities

Economies of Scale

Improving the cost of

capital

Professional human capital

High liquidity & strong

balance sheet

Proactive and efficient operation

at all levels

Strategy in Action

15


16

99% of NOI comes from Investment Grade Rated Countries

AAA AA+ AA- A+

A A- BBB BB+ BB

Canada United States

Estonia Israel Slovakia Poland Lithuania Romania Hungary

Finland Czech

Republic Russia

Germany Brazil

Sweden Latvia

Denmark

Source: Bloomberg / Standard & Poor ‘s )Foreign Rating/Long-Term Debt)/ December 2011

84%

15% 1%

AA+ Countries and Above Other Investment Grade Countries Below Investment Grade Countries

Source: Bloomberg/ Standard & Poor ‘s )Foreign Rating/Long-Term Debt)/ November 2012

16


(*) Excluding foreign exchange fluctuation 17

93.3%

96.2%

98.9%

94.3% 94.0%

96.2%

98.9%

94.9%

North America Europe Israel Total

Q3/2011

Q3/2012

Strong tenants mix - Supermarkets, Necessity-Driven Retailers and Other High Quality Tenants

1-9/2012 Same Property NOI Growth(*) Resilient Assets with Stable Occupancy

Organic Growth - Global Diversification

17

2.2%

5.8% 6.0%

3.9%

North America Europe Israel Total

LOCATION

LOCATION LOCATION

56%

12%

32% Canada

Europe

USA

Israel

7-9/2012

External Growth - Investment Activity, NIS 4.35 billion

(NIS million)

Total Investments

7-9/2012 1-9/2012

New properties acquisition 1,202 3,063

Development & redevelopment 301 1,291

Total 1,503 4,354

Dispositions and recycle of capital 476 1,413

18

56%

13%

30% 1%

LOCATION

LOCATION LOCATION

1-9/2012

20

The Group has liquid assets available and undrawn lines of credit in the amount of NIS 8.3 billion

(of which approximately NIS 2.4 billion is on the Company level)

As of September 30, 2012, net debt to total assets (LTV) was 55.6%, as compared to 60.0% as of

September 30, 2011 and 58.0% as of December 31, 2011

Year to Date, the Group has raised approximately NIS 1.9 billion in equity

Year to Date, the Group has raised approximately NIS 4.8 billion in debentures, convertible debentures

and other loans

During and subsequent to the reporting period the credit rating of Atrium was upgraded by S&P and

Fitch to investment grade level of (BBB-) with a stable outlook and the credit rating of First Capital

Realty was upgraded by DBRS to BBB (High) and by Moody’s to Baa2 with a stable outlook

Liquidity and Financial Strength

20

LOCATION

LOCATION LOCATION

21

65.9%

58.0% 57.8%

51.6% 53.8%

52.5%

48.1%

55.8%

64.9% 63.7% 60.7%

58.0% 55.6%

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

70.0%

31.12.00 31.12.01 31.12.02 31.12.03 31.12.04 31.12.05 31.12.06 31.12.07 31.12.08 31.12.09 31.12.10 31.12.11 30.9.12

FCR Acquisition

CTY Acquisition

ATR Acquisition

21

Conservative Financial Leverage

Net Debt to Total Assets

(2000 – Q3/2012)


35%

34%

23%

8%

CAD $ Euro US $ NIS

35%

33%

30% 2%

Currency Diversification Lowers FX Risk

Assets

Currency Matching Policy

22

Shareholders’ Equity

LOCATION

LOCATION LOCATION

33%

35%

26%

5% 1% Canada

Europe

USA

Israel

Brazil

11%

6% 5%

4%

3%

3% 2% 1%

Finland Poland Sweden Russia

Czech Rep. Baltics Germany Other

NOI Diversification Across Leading Economies

(*) Based on proportional consolidated NOI for the three months ended September 30, 2012

NOI Diversification (*)

23

LOCATION

LOCATION LOCATION

24

110

8,321

Shareholder Equity (*) (NIS millions)

6,642

142

LTV 55.6%

LTV 60.0%

LTV – Net Debt to Total Asset

Q3/2011 Q3/2012

25% 29%

Increase in FFO while Deleveraging – Q3/2012

FFO (NIS millions)

24

Q3/2011 Q3/2012

21%

FFO Per Share (NIS)

Q3/2011 Q3/2012

0.71

0.86


(*) Retroactively adjusted due to the implementation of new accounting standards (2011 numbers)

25

811

6.61 1,352

1,181

928 6.99

Upgrading the Portfolio while Increasing NOI

GLA (Square meter, millions)

Rental Revenues (*) (NIS millions)

Q3/2011 Q3/2012

NOI (*) (NIS millions)

14% 14%

25

Q3/2011 Q3/2012 Q3/2011 Q3/2012


5%

(*) Retroactively adjusted due to the implementation of new accounting standards (2011 numbers)

26

110 111 126 138 142

Q3/11 Q4/11 Q1/12 Q2/12 Q3/12

1,181

1,248 1,259 1,268

1,352

Q3/11 Q4/11 Q1/12 Q2/12 Q3/12

811 849 840

865

928

Q3/11 Q4/11 Q1/12 Q2/12 Q3/12

+14% +14%

0.71 0.71 0.76 0.84 0.86

Q3/11 Q4/11 Q1/12 Q2/12 Q3/12

26

+21% +29%

ובתזרים מפעולות למניה( FFO)צמיחה בתזרים מפעולות

)*(צמיחה חזקה בפרמטרים התפעוליים


Strong Growth in Operational Parameters (*)

Increase in FFO and FFO Per Share

Consistent Growth

NOI (NIS millions) Rental Revenues (NIS millions)

FFO (NIS millions) FFO Per Share (NIS)

(*) Retroactively adjusted due to the implementation of new accounting standards (Q1/12 & 2011 numbers)

27

38.6

49.4

59.7

38.8

44.4 50.4

2010 2011 Q3/2012

Epra NAV Per Share Equity Per Share

Consistent Growth in NAV Per Share

EPRA NAV (*) and Equity Per Share

27

From 2010 to Q3/2012 the dividends paid by the Company totaled NIS 650 million, NIS 4.2 per share

EPRA NAV Per Share

CAGR +28 % Equity Per Share

CAGR +16%

LOCATION

LOCATION LOCATION

(*) Retroactively adjusted due to the implementation of new accounting standards (2010 & 2011 numbers)

28

1.30

6.61

0.36

5.41

0.24

3.71

2000 2000 2000 Q3/2012

GLA (Square meter, millions)

NOI (*) (NIS billions)

Rental Revenue (*)

(NIS billions)

Consistent Growth for Over a Decade

CAGR

26% CAGR

26% CAGR

15%

28

Q3/2012 Q3/2012

(*) Q3/2012 Annualized


29

56.3% 38.5%

5.2%

Gazit-Globe – Shareholders

Norstar

Public and others

As of November 27, 2012 29


Institutional Investor

Investor Relations

Gazit Globe Dec 2012 Investor Presentation