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CHARTER HALL GROUP
HALF YEAR RESULTS 2006
16 FEBRUARY 2006
CHARTER HALL HALF YEAR RESULTS 2006 1
CONTENTS
HALF YEAR SUMMARY
PROPERTY TRUST UPDATE
FUNDS UPDATE
HALF YEAR FINANCIALS
APPENDIX
CHARTER HALL HALF YEAR RESULTS 2006 2
SUMMARY
Results on track
New funds launched
New assets acquired
New projects secured
New leases signed
CHARTER HALL HALF YEAR RESULTS 2006 3
KEY EVENTS SINCE IPO
DATE NEW FUNDS LAUNCHED ACQUISITIONS PROJECTS: NEW & COMPLETED LEASING DEALS
Diversified Property Fund CHOF 4
FEB $14.7m Emirates House office asset 2ndproject secured ($134m end value)
2006 acquired in Perth CBD Northbank Plaza, Brisbane CBD
Core Plus Office Fund * Diversified Property Fund PDP 2
Wholesale (institutional) fund launched with $4.7m office asset acquired at Brisbane American Express pre-leases 17,000sqm
$137m seed asset fringe office building Atrium (Union St, Pyrmont)
DEC
2005 Core Plus Office Fund * CHPT
$137m office asset acquired from PDP 2 Willis Australia and Vic Gov’t lease
Atrium, Pyrmont (seed asset) 4,700sqm at 570 Bourke St
CHOF 4 CHPT
NOV
1st project secured ($27m end value) Nunawading. Leases: Bev Marks, Casual
2005 420 George Street, Brisbane Living, Nick Scali. HoA: 4th anchor tenant
Diversified Property Fund
SEP $28m retail fund launched with 3 seed
2005 assets. Current value $48m
CHOF 4 Diversified Property Fund PDP 3 PDP 3
$165m of institutional equity raised – $11.1m Harvey Norman Centre secured for Commonwealth Bank pre-leases
Site 5 SOP sold to CPA for $94m
largest fund of its kind in Australia DPF at Corio VIC, Geelong (seed asset) 23,000sqm office building at Site 5 SOP.
JUL
2005 CHIF 6
$7.2m Industrial asset acquired (leased to
LG) in Townsville QLD
Diversified Property Fund PDP 2
JUN
$5.7m office asset secured for DPF in
2005 Bourke Street Alexandria site sold
Mulgrave VIC (seed asset)
CHARTER HALL HALF YEAR RESULTS 2006 * CPOF equity raising currently underway. Roadshow commences 20 Feb, First close Q2 2006
4
FINANCIAL HIGHLIGHTS ON 30 DEC 05
Listing price 10 Jun 051 $0.75
ASX closing price $0.92
Total return since listing 27.6%
LPT S&P/ASX 300 Index performance 12.7%
Excess return 14.9%
Market capitalisation2 $315m
DPU (per stapled security)3 3.73c
1 1st installment only – 2nd installment payable 30 Jun 05
2 Includes $66m second installment
3 Period 6 Jun 05 (allotment) to 31 Dec 05
CHARTER HALL HALF YEAR RESULTS 2006 5
CHCCA SECURITY PRICE MOVEMENT
Core Plus Office Fund launched
130
Charter Hall Group
AMEX lease signed at Atrium
125
Willis lease signed at
Diversified Property Fund launched Bourke Street
120
115 Entry into S&P / ASX 300
Indexed to 100
110
CHOF4 raised
LPT ASX 300
105
100
95
90
09-Jun-05 09-Aug-05 09-Oct-05 09-Dec-05 09-Feb-06
CHARTER HALL HALF YEAR RESULTS 2006 6
ASSETS UNDER MANAGEMENT
50% increase in core investment AUM since IPO
CHG well positioned to source acquisitions: 15 assets totalling $508m were
acquired over last 12 months, 100% off-market
Current AUM
1,250 $1,163m
Opportunistic Assets (completion value)
1,000 Core Investment Assets
750
500
250
0
1998 1999 2000 2001 2002 2003 2004 2005 2006
6 mths
CHARTER HALL HALF YEAR RESULTS 2006 7
CHG PRODUCT SUITE
NEW PRODUCTS SINCE IPO EXISTING PRODUCTS AT IPO
CHARTER HALL OPPORTUNITY FUND 4 CHARTER HALL PROPERTY TRUST
(CHOF 4) (CHPT)
PROPERTY DEVELOPMENT PORTFOLIO
DIVERSIFIED PROPERTY FUND (DPF)
2&3 (PDP 2&3)
CHARTER HALL INVESTMENT FUNDS
CORE PLUS OFFICE FUND (CPOF) *
(CHIF 1-6)
CHARTER HALL HALF YEAR RESULTS 2006 * CPOF equity raising currently underway. Roadshow commences 20 Feb, First close Q2 2006
8
CHG PRODUCTS SPAN ENTIRE RISK/RETURN SPECTRUM
Return
18%+ OPPORTUNISTIC
15-17% ENHANCED
UNIVERSE
12-14% CORE PLUS
9-11% CORE
Risk
Low High
CORE CORE PLUS ENHANCED OPPORTUNISTIC
DPF
CHOF 4
CHG PRODUCTS CHPT CPOF *
PDP 1,2,3 (JV with AMP)
CHIF 1-6
INVESTMENT 70% passive property assets
Passive investments Development opportunities
CRITERIA 30% enhanced return investments for long term ownership
Institutional, High Net Worth,
INVESTORS Institutional Institutional
Retail
CHARTER HALL HALF YEAR RESULTS 2006 * CPOF equity raising currently underway. Roadshow commences 20 Feb, First close Q2 2006
9
PROPERTY TRUST (CHPT)
UPDATE
CHARTER HALL HALF YEAR RESULTS 2006 10
PROPERTY TRUST (CHPT)
WALE increased to 6.1 years from PDS 5.2 years1,2
Occupancy increased to 95% (100% including income support)
All properties performing well
Pre-leasing at Nunawading on track – rents and tenant quality mix
CHPT to hold approx 20% stake in CPOF3 and DPF
1 Assumes rent guarantee period only for uncommitted tenancies at Nunawading and Mentone
2 Includes 20% of Atrium (AMEX) and CHPT’s 20% of DPF portfolio
3 CPOF equity raising currently underway. Roadshow commences 20 Feb, First close Q2 2006
CHARTER HALL HALF YEAR RESULTS 2006 11
PROPERTY TRUST (CHPT)
Strong asset diversification and quality tenant composition
Bourke
20.8% Industrial
Kent 6.1% Gov't &
Chullora
8.1% Gov't
4.8% Retail / Bulky
DPF Related
Goods Retail
3.3% 17.6%
Menai 59.7%
CPOF
13.0% Commercial National,
9.4%
34.2% Internat'l &
Other
Retail
15.3%
Mentone Nunawading Chain
17.8% 22.9% 67.1%
ASSET DIVERSIFICATION SECTOR WEIGHTING TENANT DIVERSITY
by Acquisition Price by Net Income by Net Income
NOTE: Graphs include 20% of Atrium (AMEX) and CHPT’s 20% of DPF portfolio
CHARTER HALL HALF YEAR RESULTS 2006 12
PROPERTY TRUST (CHPT)
LEASE EXPIRY PROFILE BY NET INCOME
50% Nunawading & Mentone represent uncommitted tenancies
40% Wilson Parking
30% Lease Expiry Profile
20%
10%
0%
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
DPF 5.7
CQU 6.5%
CPOF 13.3
Harvey Norman 6.3%
Mentone 7.1 Minister for Finance 6.1%
Nunawading 5.0 AMEX 5.4%
Menai 3.9 Wilsons Parking 4.1%
Chullora 4.9 Harvey Norman Tenancy 4.0%
K&S 3.5%
Bourke 3.7
Bev Marks 2.5%
Kent 10.7
Volvo 2.5%
WALE 6.1
Nick Scali 2.3%
WEIGHTED AVERAGE LEASE EXPIRIES TOP 10 TENANTS
NOTE: Graphs include 20% of Atrium (AMEX) and CHPT’s 20% of DPF portfolio
CHARTER HALL HALF YEAR RESULTS 2006 13
PROPERTY TRUST (CHPT)
HOME HQ NUNAWADING
To be completed in August 2006
CHPT continues to receive 7.5% coupon on all
funds drawn until completion plus a rent
guarantee applies for 6 months post completion
on 15% of GLA
Leasing progressing well – leases signed with 3 anchor “bookend” tenants
including Nick Scali, Bev Marks and Casual Living plus Heads of Agreement
signed with the 4th anchor “bookend” tenant being a national electrical retailer
Tenancy areas sub 1,000sqm approved by Council providing scope for higher
rent / sqm for selected smaller tenancies
CHARTER HALL HALF YEAR RESULTS 2006 14
PROPERTY TRUST (CHPT)
MENTONE
Application for rezoning approved by VCAT and subsequently supported by
Council. Development permit application submitted
Subject to final development permit and Nylex remediation and relocation,
development likely to start on programme in Q1 FY07
Pre-leasing to commence in May 2006
Nylex income continues to be received until construction commencement
7.5% coupon receivable on all funds drawn once construction underway
CHARTER HALL HALF YEAR RESULTS 2006 15
PROPERTY TRUST (CHPT)
570 BOURKE STREET
Willis Australia signed lease over levels 3, 4 & 5
Victorian Government signed lease over part of level 20
and HoA for balance of level 20
Occupancy level 100%
400 KENT STREET
Fit-out works by Central QLD University completed
CHARTER HALL HALF YEAR RESULTS 2006 16
FUNDS
UPDATE
CHARTER HALL HALF YEAR RESULTS 2006 17
CHOF 4
Launched in July 2005 after being significantly oversubscribed
Raised $165m of equity - largest opportunity fund in Australia
Capacity created for over $500m of project end value
2 projects in Brisbane underway with total end value of approx $160m
Balance of equity to be allocated over next 12-18 months
Further projects under consideration
CHARTER HALL HALF YEAR RESULTS 2006 18
CHOF 4
PROJECT 1: NORTHBANK PLAZA, BRISBANE (STAGE 1)
Refurbishment of existing 26,000sqm office building
50/50 JV with local development & investment group Indigo
Completion Value $134m, Completion Date late 2007
Stage 2 (adjacent site co-owned by CHOF 4) under
investigation for a new A-grade office tower
PROJECT 2: 420 GEORGE STREET, BRISBANE
Refurbishment of existing 6,000sqm office building
Completion Value $27m
CHARTER HALL HALF YEAR RESULTS 2006 19
PDP FUNDS
Performance fees forecast in Prospectus/PDS for FY06 have been achieved
(75% of Atrium fee recognised in Jan 06, 25% in FY07)
PDP 2: Atrium Pyrmont sold to CHG’s CPOF for $137m
PDP 2: Bourke Street Alexandria sold to owner occupier
PDP 3: Zone Site 5, Sydney Olympic Park pre-leased to Commonwealth Bank
of Australia and sold to CPA for $94m
PDP 3: 151 Pirie St Adelaide ahead of programme with completion now
scheduled for May 2006
PDP 3: Sydney Wharf* 35% pre-sold – construction commences in April 2006
* 50/50 JV with Babcock & Brown
CHARTER HALL HALF YEAR RESULTS 2006 20
DIVERSIFIED PROPERTY FUND
Launched in September 2005
Current AUM $48m comprising 5 assets in 4 states, NSW, QLD, WA and VIC
Targeting asset size in $5-30m price bracket
Open-ended fund with strong potential for growth – primary vehicle for CHIF
AUM growth
CHG receives acquisition, funds management, performance and property
management fees
CHPT to hold a stake of 20%
CHARTER HALL HALF YEAR RESULTS 2006 21
DIVERSIFIED PROPERTY FUND
Good asset diversification and quality tenant composition
St Georges Tce
Perth CBD WA
30.5% Other
Mulgrave 30.5% QLD 8.7%
Melb Metro 9.8%
11.9% National,
Internat'l &
Retail
St Pauls Tce
Chain Gov't
Brisbane Fringe
Kent St 64.9%
9.8% Related
Sydney CBD
NSW 26.4%
24.7% VIC
Geelong 24.7%
35.0%
23.2%
GEOGRAPHICAL DIVERSIFICATION TENANT DIVERSITY
ASSET DIVERSIFICATION by Acquisition Price by Net Income
by Acquisition Price
St Georges Tce, Perth CBD Kent St, Sydney CBD Princess Hwy, Corio (Geelong) St Pauls Tce, Brisbane CBD Fringe Compark Ct, Mulgrave (Melb metro)
CHARTER HALL HALF YEAR RESULTS 2006 22
CORE PLUS OFFICE FUND (CPOF)
Launched in December 2005 and $137m seed asset acquired
Open-ended fund targeting institutional investors
Target raising $250-500m of equity providing up to $1,100m asset capacity
Fund to hold primarily passive and some assets with enhanced component
Annual fund management fee of 0.45% of AUM to be earned by CHG
Roadshow commences 20 February, first close Q2 06
CHPT to hold a stake of 20%
CHARTER HALL HALF YEAR RESULTS 2006 23
CORE PLUS OFFICE FUND (CPOF)
SEED ASSET
$137m, 20,000sqm Atrium acquired from PDP 2
Pre-leased to AMEX and Coles Supermarket
Located in Pyrmont on Sydney’s CBD fringe
Stable, secure and growing distribution yields
A-Grade office building with retail area & parking
Under construction until October 2006
7.75% income yield paid by vendor on progressive
fund draws including land
CHARTER HALL HALF YEAR RESULTS 2006 24
HALF YEAR
FINANCIALS
CHARTER HALL HALF YEAR RESULTS 2006 25
FINANCIALS
1. 75% of Atrium
INCOME STATEMENT ($000’s) 6 mths to 31 Dec 05 performance fee
recognised in Jan 06
Net Rental Income 5,766 and 25% in FY07 and
hence not included in
Income guarantee on rental income 600 the H1 FY06 results
Management fee income1 5,065 2. Tax expense is a credit
due to a one off payment
Interest income 1,136 which was tax deductible
in FY06 but amortised
Other income 687 over 5 years for
accounting purposes.
Total income 13,254 3. Fair value adjustments
represent property
Operating expenses (3,813) acquisition costs
including stamp duty
Financing costs (1,671) required to be written off
Total expenses (5,484) under AIFRS (AASB
140). Such costs were
Net profit before tax 7,770 capitalised under
AGAAP.
Tax 2 276 4. Represents distribution
from CHPT, nil dividend
Net profit after tax (6 months to 31 Dec 05) 8,046 from the company.
5. Before AIFRS fair value
Add - Jun 05 NPAT 509 adjustment.
6. EPU lower than DPU for
Net profit after tax 6 Jun to 31 Dec 05 8,555 the period as the bulk of
Less - AIFRS fair value adjustments 3 (9,136) performance fees are to
be earned (by CHL) in
Net profit/(loss) after tax per statutory accounts 6 Jun to 31 Dec 05 (581) H2 FY06.
Interim Distribution to security holders 4 9,849
6 Jun – 30 Jun 05 1 Jul 05 – 31 Dec 05 Total
EPU per stapled security 5 0.19c 3.05c 3.24c
DPU per stapled security 6 0.45c 3.28c 3.73c
CHARTER HALL HALF YEAR RESULTS 2006 26
FINANCIALS
BALANCE SHEET ($000’s)
Current assets 83,344
Non current assets 251,386
Total assets 334,730
Current liabilities 24,112
Non current liabilities 118,587
Total liabilities 142,699
Equity 192,031
FINANCIAL METRICS (000’s)
Property investments $240,088
Borrowings $116,666
Gearing 1 34.9%
Securities on issue 270,279
Securities on issue excluding LTI 2 264,057
NTA per security $0.73
1 Gearing has increased temporarily from 17.4% after the acquisition of Atrium, the seed asset of CPOF. CHPT is warehousing the asset until external equity is raised.
2 Excluding securities issued under Long Term Incentive Plan required under AIFRS (AASB 2).
CHARTER HALL HALF YEAR RESULTS 2006 27
CAPITAL MANAGEMENT
DEBT
Facility limit $225m
Amount drawn at 31 December 2005 * $117m (or 52%)
Average amount drawn for the period $44m
Hedged component 97%
Weighted average maturity – facilities 3 year evergreen
Weighted average maturity – hedges 6.3 yrs
Weighted average fixed rate 6.49%
Weighted average interest rate 6.33%
DRP (Dec 05 distribution)
Participation 71.7%
Issue price (2% discount) $0.8936
Equity raised $7.2m
* Of the $117m drawn as at 31 Dec 05, $69m is to be novated to CPOF upon allotment for CPOF.
CHARTER HALL HALF YEAR RESULTS 2006 28
APPENDIX
CHARTER HALL HALF YEAR RESULTS 2006 29
CHARTER HALL GROUP
BOARD OF DIRECTORS
2 Executive (Andre Biet and Cedric Fuchs), 2 Non-executive, 4 Independent
Stapled & Managed via Responsible Entity
CHARTER HALL FUNDS MANAGEMENT LTD
CHARTER HALL CHARTER HALL
LIMITED PROPERTY TRUST
Joint CEO Joint CEO
David Harrison David Southon
FUNDS PROPERTY PROPERTY PROPERTY
MANAGEMENT MANAGEMENT DEVELOPMENT INVESTMENT
BANKING
• Core Plus Office Fund • Opportunity Fund 4
• Diversified Property Fund • PDP 3
• Investment Funds • PDP 2
• Listed Property Trust • PDP 1
CORPORATE SERVICES: Finance, Company Secretarial, Compliance, Administration, Investor Relations,
Leasing, Marketing, Acquisitions
CFO Nathan Francis
CHARTER HALL HALF YEAR RESULTS 2006 30
NEW PRODUCTS SINCE IPO
FUND EQUITY ($m) AUM ($m) DESCRIPTION
Property development, Australia wide
$350 Target Equity IRR 20+, gearing 65% of completion value
Opportunity To be Wholesale (institutional) investors , closed end, CHPT committed $5m investment
$165
Fund 4 identified Equity invested with 2 and repatriated within 5 years
(CHOF 4) Raised
$150
Underway
$500 $137 Open ended fund currently being marketed to wholesale (institutional) investors, Q2
Seed asset 2006 1st close
Target
Core Plus acquired 70% Passive and 30% Enhanced office assets, above $30m, LT leases, solid tenant
Office Fund Raising
covenants, Australia wide
(CPOF) ($100 to be $1,000
Target Equity IRR 12%+, LT gearing 50-55%, CHPT will hold 20% stake
held by To be
CHPT) identified
Open ended fund, retail investors, Australia wide
$21 Passive quality assets, $5-30m range, LT leases, solid tenant covenants
Diversified $48 Currently 4 assets (fund’s been open since September 2005 – fast growing)
Property Fund Raised /
Under 65% gearing, providing 7.75%+ distribution yield, CHPT will hold 20% stake
(DPF) Currently
management
being raised
CHARTER HALL HALF YEAR RESULTS 2006 31
EXISTING PRODUCTS AT IPO
FUND EQUITY ($m) AUM ($m) DESCRIPTION
Property development, eastern seaboard
Property $269 $694 Target Equity IRR 25+, gearing 65% of completion value
Development Completed Wholesale (institutional) investors , closed end, equity invested with 2 and repatriated
Portfolio Raised &
Fully $291* within 5 years
1, 2 & 3 PDP 1 closed. All equity allocated in PDPs 2&3
(PDP 1,2,3) Allocated Underway
Passive quality assets, LT leases, solid tenant covenants
All funds that have come up for review have been rolled over
Investment $136
Funds $39 HNW investors, exclusive offers, 11 assets in total
(CHIF 1-6, Under
Remaining
W10DT) management
Stapled, 6 assets in total (part of CHG)
Passive quality assets, LT leases, solid tenant covenants, Australia wide
$265
Property Trust
(CHPT) Under
management
* Excludes Nunawading and Atrium projects which have been pre-sold, however CH is still receiving Fund Management Fees on Nunawading and Development Mgmt Fees on both until PC date
CHARTER HALL HALF YEAR RESULTS 2006 32
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