buwog group

BUWOG GROUP

COMPANY PRESENTATION

NOVEMBER 2016

ASSET MANAGEMENT

3

ASSET MANAGEMENT

Clear focus on growing cities and suburban areas

with intact socio-demographic profile

Clear focus on growing cities

Household growth

rate

2013 - 2015

Rent

development

(market)

2011 – 2025

BUWOG

units (2)

as % of total

Berlin 3.3% 16.8% 10.8%

Hamburg 5.2% 4.7% 6.1%

Luebeck 0.5% 9.8% 12.3%

Kiel 6.2% 10.9% 7.3%

Vienna 9.6% ~ 2% (1) 13.8%

Source: German Federal Office for Statistics, forecast bulwiengesa, IBB research

(1) Acc. to BWUOG’s lfl rental growth guidance (due to subsidised rental regime in Vienna)

(2) Cities and suburban area as per 31 July 2016

Key facts & KPIs

30 Apr16 31 Jul16

Number of units 51,058 50,901

Total floor area (in sqm) 3,532,273 3,520,169

Fair value (in EURmn) 3,716 3,852

Annualised net in-place rent (in EURmn) 201 206

Gross rental yield 5.4% 5.4%

Multiple 18.5 18.7

Asset Management

PORTFOLIO CLUSTER

Portfolio by regions

Asset Management

4

• Approx. 86% of the fair value of the BUWOG portfolio is located in

urban regions which are very attractive in terms of their

• economic development

• infrastructure and

• demographics

• Approx. 90% of the units and 92% of the fair value the German

portfolio is located in the TOP 10 locations in Germany. The focus

for acquisitions in Germany is also on these TOP 10 locations.

38%

31%

15% 16%

39%

32%

14% 15%

39%

33%

14% 14%

Federal capitals State capitals andmajor cities

Suburban regions Rural areas

30 April 2015 30 April 2016 31 July 2016

Fair value

by geographic cluster (total approx. EUR 3.9bn)

No of units in % Total floor area

(in sqm)

Annualised net in-

place rent

(in EURmn)

Monthly net in-

place rent (in

EUR/sqm)

Fair Value

(in TEUR) in %

Gross Rental Yield

(in %)

Lübeck 6,276 23% 363,791 24.5 5.7 382.6 21% 6.4%

Berlin 5,522 20% 365,675 26.4 6.2 506.3 28% 5.2%

Kiel 3,698 14% 230,117 16.2 6.0 247.5 14% 6.5%

Hamburg area 3,113 11% 193,165 13.1 5.7 221.1 12% 5.9%

Braunschweig 1,568 6% 91,062 6.2 5.8 91.0 5% 6.8%

Kassel 1,508 6% 107,292 5.3 4.4 70.5 4% 7.5%

Rendsburg 735 3% 40,317 2.7 5.8 31.2 2% 8.6%

Lüneburg 702 3% 51,076 3.4 5.8 48.6 3% 7.0%

Ratzeburg 649 2% 39,281 2.4 5.3 30.2 2% 8.1%

Heiligenhafen 633 2% 34,361 2.1 5.3 22.6 1% 9.2%

TOP 10 Germany 24,404 90% 1,516,136 102.4 5.8 1,651.5 92% 6.2%

Top 10 Germany

31 July 2016

Rental increase 78%

5

L-F-L RENTAL GROWTH

L-f-l rental growth of 4.2%

Re-letting 16%

Split of l-f-l rental growth

in % if total l-f-l rental growth

Rental growth :

EUR 676k /

month

No

of units

Occupied

floor area

(in sqm)

Net in-place

rent / month

(in EURmn)

Occupied

floor area

(in sqm)

Net in-place

rent / month

(in EURmn)

l-f-l rental

growth

Germany

Unregulated rental agreements 16,979 957,936 5.3 964,256 5.5 3.2%

Regulated rental agreements 9,257 594,315 3.2 595,397 3.2 1.9%

Total Germany 26,236 1,552,251 8.4 1,559,653 8.7 2.7%

Austria

Unregulated rental agreements 1,672 124,352 0.7 129,573 0.7 0.6%

Regulated rental agreements 21,682 1,559,801 6.0 1,552,902 6.4 6.6%

Total Austria 23,354 1,684,153 6.7 1,682,474 7.1 6.1%

Other (incl. Commercial) 528 89,846 0.5 89,079 0.5 2.2%

Total BUWOG Group 50,118 3,326,251 15.6 3,331,207 16.3 4.2%

31 Jul 2015 31 Jul 2016

L-f-l rental increase in Austria of 6.1%

• Mainly as a result of the increase in the maintenance & improvement contribution from

max. EUR 1.71 to max. EUR 2.00 per sqm/month (due to a change in the Austrian

rental law – “WGG Novelle”) BUWOG was able to increase its Austrian rents in July

2016 by 6.1% factoring in market conditions and other factors including other rental

regimes not affected by maintenance and modernization contributions.

KPIs

Monthly net in-place rent

(in EUR/sqm) EUR 5.07

Annualized net in-place rent

(in EURmn) EUR 206mn

Change in vacancy 6%

Asset Management

6

ECONOMIC L-F-L RENTAL GROWTH AUSTRIA

Economic l-f-l rental growth in Austria

• Austrian rental growth results from rent increases and increases of the rent‘s maintenance and improvement contribution component.

• Increases of the maintenance and improvement contributions are only reflected in rental income to the extent they are invested into the

respective portfolio units.

• To the extent they remain uninvested they are booked as liabilities against rental income.

Asset Management

• l-f-l rental growth is not entirely reflected in rental income and therefore does not translate directly to

NOI and FFO

• l-f-l rental growth with a positive effect on cash inflow

Economic l-f-l rental growth

• only driven by increases in basic rent and invested maintenance and improvement

contribution component

• slightly above 1% (per 31 July 2016)

7

CAPEX & MAINTENANCE PROGRAM

Additional capex & maintenance program of EUR 57mn in Germany

Investment of approx. EUR 57mn in Germany over the next

two years , to increase rental growth:

• Assumed capitalisation rate of approx. 90%

• Investments will be leveraged with 30% financing

Regional focus in EURmn

Hamburg surroundings 4

Kiel 13

Lübeck 17

Braunschweig 6

Berlin 17

Total 57

Measurements in EURmn

Energy efficiency 42

Increased density ( attic / balcony) 6

Increased density (new buildings) 9

Total 57

Rental growth approx. EUR 3mn p.a.

(after total investment)

Levered ROI approx. 7%

Gross Rental Yield approx. 6%

Asset Management

48%

42%

49%

57% 60%

34%

52% 53% 52%

61% 62%

33%

50%

Peer A Peer B Peer C Peer D Peer E BUWOG BUWOGNEW

8

INVESTMENT CAP RATE IN LINE WITH PEERS

Capitalisation policy of investments in line with best practice

Cap rate - market practice

in % of total investment volume

FY2014

FY2015

New capitalisation policy of investments for FY2016/17 of approx. 50%

Source: KPMG analyse

New capitalisation

policy of approx. 50%

still below average

capitalisation rate of

peer group

Peer Group

Ø FY 2015: 56%.

Asset Management

9

NEW CAP RATE

Implementation of the adapted capitalisation policy of investments

Asset Management

In Q1 2016/17 the new capitalisation guideline in line with best

practice was implemented

Capitalisation rate of 47.4% vs 23.2% in Q1 2015/16

Expected capitalisation rate of approx. 50% going forward

Expected positive effect on Recurring FFO of min. EUR

5mn for the entire FY 2016/17

The implementation of the new policy also lead to a change in

the comparative information (Q1 2015/16) amounting to EUR

1.7mn.

in EURmn Q1 2015/16 (old cap rate)

Q1 2015/16 (new cap rate)

Q1 2016/17 (new cap rate)

Change (1)

Maintenance and Modernisation 10.1 10.1 13.5 34.5%

Maintenance 7.7 6.1 7.1 -7.8%

Modernisation (CAPEX) 2.3 4.0 6.4 174.2%

Modernisation (CAPEX) in % 23.2% 39.7% 47.4% 24.2%

Average total floor area in 1,000 sqm 3,572 3,572 3,526 -1.3%

Maintenance and investment

in EUR per sqm 2.8 2.8 3.8 36.2%

Maintenance in EUR per sqm 2.2 1.7 2.0 -8.2%

Investment (CAPEX) in EUR per sqm 0.7 1.1 1.8 160.0%

(1) Relate to changes between Q1 2015/16 based on old cap rate to Q1 2016/17 based on new rate cap rate

PROPERTY SALES

635

140 154

484

70 1

FY2015/16 Q1 2015/16 Q1 2016/17

Unit Sales Block Sales

SALES

Highlights Q1 2016/17

Unit Sales cluster contains 12,512 units with a fair

value of approx. EUR 1.5bn

Run rate of approx. 600 units p.a. to be sold at steady

margins > 55%, primarily to owner-occupiers

Successful Unit Sales business in Q1 2016/17 with 154

units sold

1,119

210 155

Units sold

Property Sales

11

in EURmn Q1 2015/16 Q1 2016/17 Change

Revenues Property Sales 33.4 27.7 -17%

thereof Unit Sales 22.1 27.1 23%

thereof Block Sales 11.3 0.6 -95%

NOI Property Sales 9.6 9.6 0%

thereof Unit Sales 7.9 9.6 22%

thereof Block Sales 1.8 0.0 -98%

Margin on fair value (in%) 42% 56% 13.3PP

Margin on fair value – Unit Sales 59% 57% -1.9PP

Margin on fair value – Block Sales 19% 6% -12.5PP

Realised average price in EUR per sqm

Margin on fair value in %

2,108 2,095 2,297

907

1,421

1,836

1,608 1,809

2,286

FY2015/16 Q1 2015/16 Q1 2016/17

Unit Sales Block Sales Total

57% 59% 57%

14% 19%

6%

44% 42%

56%

FY2015/16 Q1 2015/16 Q1 2016/17

Unit Sales Block Sales Total

Highly profitable, recurring FFO from Unit Sales

PROPERTY SALES

Positive cash flow from Property Sales in Q1 2016/17(1)

Unit Sales: 154 units sold with an NOI contribution of approx.

EUR 9.6mn in Q1 2016/17.

Block Sales: only 1 unit sold in Q1 2016/17.

Within the business area Property Sales the Unit Sales

business generated a positive cash flow of EUR 19.4mn in

Q1 2016/17.

The Block Sales business generated a positive cash flow of

EUR 0.3mn in Q1 2016/17.

Property Sales – NOI contribution in Q1 2016/17

Q1 2016/17 NOI contribution of EUR 9.6mn and free cash flow of EUR 19.7mn

(FY 2015/16 NOI contribution of EUR 38.2mn and free cash flow of EUR 67.6mn)

Property Sales

12

(1) Excluding changes in receivables relating to property sales amounting to EUR 28mn

in EURmn Unit Sales Block Sales Total

Revenues Property Sales 27.1 0.6 27.7

FV of sold properties -16.8 -0.5 -17.3

Expenses from property sales -0.7 -0.1 -0.8

NOI Property Sales 9.6 0.0 9.6

in EURmn Unit Sales Block Sales Total

Revenues Property Sales 27.1 0.6 27.7

Debt repayment -7.0 -0.2 -7.2

Expenses from property sales -0.7 -0.1 -0.8

CF from Property Sales 19.4 0.3 19.7

DEVELOPMENT

14

DEVELOPMENT STRATEGY OVERVIEW

Total development pipeline of EUR 2.54bn with 8,897 units in Berlin, Hamburg and Vienna

Approx. 70% – 80% develop-to-sell

• Increase profitability

• Berlin, Hamburg and Vienna development focus

• 30-month timeline including preparation, construction, sales

launch and execution

• Pre-sales & down payments by purchasers accelerate cash

generation also during construction phase

• Funding: approx. 20% equity and 80% bank loans and down

payments by purchasers (relation between bank loans and

down payments depending on pre-sales and construction

progress)

• Development margin on investment volume

• 20% in Germany

• 18% in Austria

• Levered IRR Hurdle: 15%

Feasibility analysis

Marketability analysis

Funding analysis

Profitability analysis

Approx. 20% – 30% develop-to-hold

• Enhance portfolio quality, growth independent from acquisitions

• Currently only projects in Vienna are under construction, Berlin

and Hamburg are in planning

• New buildings with high quality and modern specification

enhancing portfolio quality

Subsidised (only Vienna)

• Subsidised loans & tenant

contributions minimise equity

requirement

• Permanent rental cap

approx. EUR 5.35 / sqm

• Holding period in own

portfolio approx. 10 years

• After 10 years unit sales to

tenants and third parties with

attractive FV margin of >

50%

Without subsidies

• Only Berlin and Hamburg

• No subsidies → no rent caps

• Attractive gross rental yield

of 4.5%

• NOI advantage vs.

secondary market assets

due to low maintenance &

capex

• High quality units remain in

own portfolio

Development

15

RISK MANAGEMENT DEVELOPMENT

Managing of risk by:

Large number of

purely residential

projects

Current development pipeline contains 49 projects in Berlin, Hamburg and Vienna

Currently 12 projects with 971 units under construction; projects divided into construction phases

Track record More than 65 years of development expertise in Austria

Experienced team of project developers in Germany

Exit optionality Construction in line with marketing capacity for development to sell

Alternative exit option into own portfolio as an attractive opportunity minimises the selling risk

3 largest German

speaking cities

BUWOG is only active in 3 hot spot markets: Berlin, Hamburg and Vienna

All cities with demand overhang due to fundamental household growth

Strict KPI

monitoring

Pre-sales in line with construction progress; on average 80% are sold at completion mainly via

experienced in-house sales teams

During the construction phase pre-sales and cost monitoring are measured in detail

Focus on reliable and stable regimes

Limited pipeline

duration

Favourable cycle as business benefits from strong fundamental demand coupled with low interest

rates and most stable and sought after markets

Very attractive yields for own new buildings in comparison to actual rental yields for secondary

market assets

Low financing

risk In contrast to pure developers BUWOG benefits from stable Asset Management and good access

to mortgage banks and access to capital markets as a listed company

Cluster

Know-how

Exit

Geographic

exposure

Execution

Cycle

Liquidity &

Financing

Risk:

Development

as of July 2016

No of

projects

No of

units Floor area

(in sqm)

Investment

volume

in EURmn

Currently under construction(1) 7 639 59,376 201

Planned construction start in FY

2016/17(2) 2 110 10,786 40

In planning stage(2) 9 2,465 206,884 795

Land reserves 0 0 0 0

Total 18 3,215 277,046 1,036

16

DEVELOPMENT BERLIN

Overview of development projects in Berlin

Currently under construction

Planned construction start in FY2015/16

In planning stage

Development product mix:

2,282 condominiums

933 rental apartments

(to be developed for own portfolio)

(1) Project “ Westendpark” and “Uferkrone” will be carried out in multiple phases with different dates for the beginning of construction. The major share with 197 uni ts are

currently under construction

(2) Project “Regattastr.” will be carried out in multiple phases with different dates for the beginning of construction. The first construction phase “Seefeld I” with 114 units

started in the FY 2015/16 and the develop-to-hold project “Ankerviertel “ started in Q1 2016/17 with 86 units

Development

as of July 2016

No of

projects

No of

units Floor area

(in sqm)

Investment

volume

in EURmn

In panning stage (construction

start from FY2016/17) 1 1,279 100,200 444

17

DEVELOPMENT HAMBURG

Hamburg become third development location



In planning stage


975 condominiums

304 rental apartments


Purchase of an approximately 42,700 sqm land site in Hamburg-Bergedorf for residential project with over 1,000 units is the launch of

development activities in Germany’s second largest city.

Development

18

DEVELOPMENT VIENNA

Overview of development projects in Vienna



In planning stage

as of July 2016

No of

projects

No of

units Floor area

(in sqm)

Investment

volume

in EURmn

Currently under construction 9 730 61,976 200

Planned construction start in FY

2016/17 8 1,071 77,678 243

In planning stage 16 2,602 216,723 618

Land reserves 4 0 0 0

Total 37 4,403 356,377 1,061.2


2,643 condominiums

1,760 subsidised and free financed rental

apartments


Development

266 464 730 181

890

1.071 1.313

1.289

2.602

Develop-to-hold Develop-to-sell Total

In planning stage

Planned constructionin FY2016/17

Under construction

86 553 639 110 110 1.151

2.594

3.745

Develop-to-hold Develop-to-sell Total

In planning stage

Planned constructionin FY2016/17

Under construction

Pipeline Berlin & Hamburg

in number of units and investment volume(1) in EURmn

19

Development

DEVELOPMENT PIPELINE

Development pipeline to-sell vs. to-hold with a total investment volume of EUR 2.541bn (as per 31 Jul 2016)

EUR 207mn

EUR 27mm

EUR 46mn

Investment

volume

EUR 279mn

1,760 units

Pfarrwiesengasse, 1190 Wien

52 Grad Nord, Berlin Grünau

Westendpark, Berlin

EUR 411mn

EUR 216mm

EUR 154mn

Investment

volume

EUR 782mn

2,643 units

EUR 618mn

EUR 243mm

EUR 200mn

Investment

volume

EUR 1,061mn

4,403 units Pipeline Vienna

in number of units and investment volume(1) in EURmn

EUR 308mn

EUR 25mm

Investment

volume

EUR 333mn

1,237 units EUR 931mn

EUR 40mm

EUR 176mn

Investment

volume

EUR 1,147mn

3,257 units

EUR 1,239mn

EUR 40mm

EUR 201mn

Investment

volume

EUR 1,480mn

4,494 units

(1) Investment volume excluding internally calculated cost of equity

Development pipeline

177 180 287 347

2.468

243 213 545

896

989

0

500

1.000

1.500

2.000

2.500

3.000

3.500

FY2015/16

FY2016/17

FY2017/18

FY2018/19

FY2019/20onwards

GER AT

Development pipeline

86 341

810

166 100

341

1.153

0

200

400

600

800

1.000

1.200

1.400

1.600

1.800

2.000

FY2015/16

FY2016/17

FY2017/18

FY2018/19

FY2019/20onwards

GER AT

Basic assumptions (develop-to-sell)(2)

20

OUTLOOK DEVELOPMENT

Development

Planned completion of units to-sell(1)

Outlook in units

Planned completion of units to-hold(1)

Outlook in units

Investment of approx. EUR 60mn p.a. for the next 3 years to increase

development pipeline in order to stabilise development output from FY

2019/20 onwards to:

• approx. 1,200 units completed to-sell p.a.

• approx. 400 units completed to-hold p.a.

Germany Austria

Ø sales price (in EUR per sqm) 4,900 4,000

Ø investment volume(3) (in EUR per sqm) 4,100 3,400

Ø sqm per unit 88 86

Ø margin on investment volume(3) 20% 18%

166

186

682

1,963

3,457

1,243

832

393(1) 420

The chart above illustrates the development pipeline’s planned completion times. In

development there may be delays as a result of unforeseeable factors of influence such as

expected approval processes resulting from bureaucracy.

The completion times may therefore change

Germany Austria Total

Develop-to-hold 1,237 1,760 2,997

Develop-to-sell 3,282(1) 2,643 5,925

Total 4,519 4,403 8,922

Total development pipeline in units

(1) Thereof 25 units already completed in Q1 2016/17

(2) Based on the current pipeline. Assumptions can be subject to change depending on individual projects

within the pipeline

(3) Excl. calculated cost of equity

(4) Definition: Sales minus capitalised and non-capitalised costs before tax (=investment volume) in relation to

investment volume

21

PIPELINE PROJECTS WITH HIGH MARGIN OF Ø19%

Average margin on investment volume of 18% in Vienna

in planning

under

construction

Average margin on investment volume of 20% in Germany

in planning

under

construction

0% 5% 10% 15% 20% 25% 30% 35%

0% 5% 10% 15% 20% 25% 30% 35%

Margin on investment volume: Sales minus capitalised and non-capitalised costs before tax (=investment volume excl. cost of equity) in relation to investment volume excl. cost of

equity

Size of bubbles refer to

the investment volume of

the project

Development

22

DEVELOPMENT ASSETS

Development assets according to status

Development

Projects Vienna

in % of total carrying amount

Under construction 40%

With zoning 32%

Without zoning 28%

Projects Berlin & Hamburg

in % of total carrying amount

Under construction 29%

Without zoning 63%

Total carrying amount:

EUR 255mn

Total carrying amount:

EUR 300mn

Development assets as per balance sheet

• Pipeline projects (under investment properties) are

undeveloped land reserves and projects whose

construction will begin more than 6 months after the

balance sheet date.

Increase due to closing of two land site acquisitions in

Austria (EUR 15mn) and two in Germany (EUR 102mn)

• Investment properties under construction are

development projects-to-hold which are under construction

of whose construction will begin less than 6 months after

the balance sheet date.

Increase mainly due to construction progress in Vienna

• Inventories are development projects to-sell which are

under construction or whose construction will begin in less

than 6 months after the balance sheet date.

• Increase due to increased number of units under

construction from 971 to 1,369 units.

in EURmn 30 Apr 16 31 Jul 16

Pipeline projects (under Investment properties) 168.7 287.0

Investment properties under construction 33.0 38.1

Inventories 217.3 230.0

Total assets development 419.0 555.0

With zoning 8%

35,2 54,4

168,7

287,0 33,0

38,1 217,3

230,0 33,2

32,4

-101,1 -113,3

-35,2 -54,4

FV adjustment according to EPRA guidelines

Inventories

Investment properties under construction

Pipeline projects (under investment properties)

Cash (related to down payments)

Loans relating to development

Down payments (liabilities)

23

“WORKING CAPITAL” - ASSETS AND FUNDING

Development

in EURmn

• Aim to complete the current pipeline within 5 years; pipeline

contains 8,897 units in Berlin, Hamburg and Vienna.

• Due to quick completion of pipeline assets as well as

financial liabilities related to development should be

considered working capital.

Comments

• Increase in working capital reflects intensified development

activity as pipeline and construction volume increase.

• EUR 32.4mn FV adjustments refer to inventories that are

measured at cost, while in the ERPA NAV calculation these

projects are measured at fair value to show the relating current

valuation upside amounting to EUR 32.4mn as per 31 Jul16.

• FV adjustment is included in EUR 474mn working capital

assumption to adjust for valuation differences under IFRS.

30Apr16

EUR 351mn

31Jul16

EUR 474mn

Pipeline matures quickly

Development assets

EUR 555mn

Liabilities

EUR -168mn

Cash

EUR 54.4mn

0%

20%

40%

60%

80%

100%

120%

T0 M0 M1 M2 M3 M4 M5 M6 M7 M8 M9 M10 M11 M12 M13 M14 M15 M16

Equity Bank loans Down payments by purchasers Construction costs

24

WORKING CAPITAL FINANCING

Illustrative financing structure of develop-to-sell projects

Financing: develop-to-sell (illustrative)

in % of total construction costs

margin on

construction costs

Land site acquisition

Start of construction &

marketing activity

Comments:

• Land site acquisition is generally

financed with equity.

• Construction costs amounting to

approx. 80% of gross investment

volume are financed with bank loans

and down payments by purchasers

(down payments are linked to certain

construction stages). Economically

down payments are netted with bank

loans and therefore reduce the

interest payments (however, within

the balance sheet both positions are

shown separately under financial

liabilities and other liabilities).

• On a single-project basis, debt is

typically rising in-line with construction

progress. However, rising down

payments received from purchasers

limit the actual LTV impact

increasing LTV

With the start of the construction

LTV increases in line with

progress as construction costs

are financed with bank loans

decreasing LTV

At certain construction stages BUWOG receives

down payments limiting the bank liabilities.

Therefore at a certain construction level LTV

decreases due to down payments received

Development

25

DEVELOP-TO-HOLD STRATEGY IN GERMANY

Location Berlin & Hamburg Berlin & Hamburg

Characteristics

• High-quality, modern specifications

• Modern floor plan

• State of the art energy efficiency leading to low

ancillary costs

• Limited capex requirements

• Solid long-term growth

• Lower-quality, old structure

• Energy inefficient

• Investment opportunity for short-term growth by

capex investment

• Significant capex requirements

• Modest long-term growth

Monthly net in-place rent approx. EUR 13 / sqm approx. EUR 5 / sqm

Gross Rental Yield(1) 4.5% 3.5% - 4.5%

NOI margin 87% 74%

NOI yield(2) 3.9% 2.6% - 3.3%

Capex requirement(3) 3.5% 14.6%

Economic Rental Yield(4) 3.8% 2.2% - 2.9%

Short Term l-f-l rental growth(5) approx. 1.0% approx. 1.8%

Long Term l-f-l rental growth(6) approx. 2.0% approx. 1.7%

Develop-to-hold Buy

(1) Annualised net in-place rent in relation to fair value

(2) NOI in relation to fair value

(3) Normalised capex requirements

(4) Based on annnualised net in-place rent after operating expenses and capex requirements

(5) Estimated like-for-like rental growth next 5 years

(6) Estimated like-for-like rental growth after 5 years

Illustrative

comparison

develop-to-hold vs.

portfolio acquisition –

BUWOG assumptions

Development

26

DEVELOP-TO-HOLD IN GERMANY

Develop-to-hold in Berlin & Hamburg

Development

Project Location

No.

of units

Total floor

area (in `000 sqm)

Investment

volume (in EURmn)(1)

Under construction

Ankerviertel Berlin 86 7.692 25.5

Future pipeline

Berlin 847 64.3 236.0

Hamburg 304 18.2 71.6

Total 1,237 90.2 333.1

Current develop-to-hold projects in Germany 1st develop-to-hold project “Ankerviertel” in

Berlin is under construction

• In Q1 2016/16 BUWOG started with the first

construction phase of the Project “Ankerviertel” in

Berlin.

• Project contains 86 units to-hold and an

expected gross initial rental yield of 4.5%.

• 270 units to-hold of the project “Regattastraße/

Ankerviertel” are included in the future pipeline.

• Currently the project “Ankerviertel” is reported

under inventories. In H1 2016/17 it will be

transferred to Investment properties under

construction as an external fair value valuation for

the development assets will only be done twice a

year.

Under Inventories the assets are measured at cost

while Investment properties under construction are

measured at FV.

Further increase of develop-to-hold units intended

(1) Investment volume excluding calculated cost of equity

HIGH MARGIN INTERIM TO-HOLD

DEVELOPMENT IN VIENNA

Due to the minimal use of equity required, this sample property development yields an levered IRR of 11.7% over the

period of 28 years

Implied equity commitment key to understand the full project return potential:

Project Otterweg in Vienna as illustrative sample

Planning/Construction

Year (3)-(1)

Divestment Period

Year 11-25

Cash-Out EUR (15,491) EUR (4,716) EUR (12,656)

Purchase

Cost of Land

EUR (1,750)

Construction

Cost

EUR (13,741)

Interest Cost

EUR (2,362)

Amortisation and

repayment of subsidised

and bank loans

EUR (10,294)

Cash-In EUR 15,491 EUR 5,135 EUR 35,863

Net CF 0 EUR 420 EUR 23,207

0 EUR 420 EUR 23,627

Subsidised and bank loans

EUR 11,599

Tenant Contributions(1)

EUR 3,892

Rental Income

EUR 5,135

Rental Income

EUR 13,467

Income from Sales

EUR 22,396

Interest costs EUR (3,411)

Amortisation of subsidised

and bank loans EUR

(1,305)

Equity Generation

Renting Period

Year 1-10

Average interest rate of

subsidised loans of 1.49% with

an average maturity of 21 years

Tenant contributions as “second

rent” paid upfront, which are

amortised over 100 years

Monthly rental prices of approx.

EUR 5.35 / sqm; rental growth

roughly in line with average CPI

Despite long project period,

equity is only tied up for a very

limited time

In EUR

thousand

Equity contribution only

required for purchase of land

and repaid by tenant

contributions upon completion

27

(1) Tenants are required to contribute approx. EUR 500/sqm down payments to landlord bearing negative interest

of 1% p.a in return for being eligible to subsidised rents according to Austrian subsidised rental regimes

Development

28

VALUATION PARAMETERS

Valuation parameters

EBIT multiple FFO Development

Margin on investment volume

• EBIT development of EUR 20.9mn in FY2015/16

• Anticipated increase to approx. EUR 50mn plus in FY

2018/19 EBIT multiple of European peers approx. 8x – 9x

• Recurring FFO development of EUR 11.8mn in FY2015/16

• Anticipated increase to approx. EUR 39mn plus in FY

2018/19

• BUWOG assumption of cost of equity of 8% results in a 12.5

multiple

• Total pipeline to-sell of approx. EUR 1.9bn gross investment

volume

• Margin on completed projects approx. 19%

• Anticipated profit before tax of EUR 360mn

Value step-up on develop-to-hold

• Total pipeline to-hold of approx. EUR 600mn gross

investment volume

• After completion value step-up possible

Levered IRR

• On average BUWOG expects levered IRR of min. 15% on

Development projects in Austria and Germany

Development

FINANCING -

KEY FACTS AND FIGURES

30

LTV Q1 2016/17

• Low LTV within the development business as land plot

acquisitions are generally financed with equity and only

construction costs are financed with bank loans and

down payments.

• On a single-project basis, LTV is typically rising in-line

with construction progress. However, down payments

received by purchasers are linked to certain

construction stages, and economically reduce the net

amount of bank loans and therefore bring down LTV.

• Decline of LTV based on increase of value of property

assets determined by appraisal as of 31 Jul 16.

Financing - Key Facts and Figures

Group LTV of 46.4% as per 31 Jul 16

• Meets target of sustainably below 50% with 46.4% for

the entire group.

• Decline in LTV is driven by Development LTV decrease.

Group LTV

46.4%

LTV Asset

Management

50.1%

LTV Development

20.4%

in EURmn 30 Apr16 31 Jul16

Investment properties 3,716.3 3,852.0

Non-current assets held for sale 0.0 0.0

Financial liabilities -1,951.5 -2,031.7

Cash 82.5 101.7

LTV Asset Management (in %) 50.3% 50.1%


Carrying amount total portfolio 4,135.3 4,407.0

Net financial debt -1,970.1 2,043.2

Group LTV (in %) 47.6% 46,4%


Pipeline projects / Investment properties 168.7 287.0

Investment properties under construction 33.0 38.1

Inventories 217.3 230.0

Financial liabilities -101.1 -113.1

Down payments by purchasers 35.2 54.4

LTV Development (in %) 24.1% 20.4%

Economic LTV Development (in %) 15.7% 10.6%

31

POST Q1 2016/17: SUCCESSFUL PLACEMENT

OF CB ENABLES FURTHER GROWTH Successful placement of EUR 300mn convertible bonds


Convertible Bonds - Key facts

Nominal EUR 300mn

Maturity 5 years

Coupon 0.00%

Premium 35%

Initial strike EUR 31.40

Dividend protection above EUR 0.69/share

ISIN AT0000A1NQH2

Placement on 6 Sept 2016

Placement of a senior unsecured CB due in 2021

• Multiple oversubscription in order book

• Zero-coupon with 35% premium

• 56% above last reported EPRA NAV at placement

• With an initial conversion price of EUR 31.40 the bonds are initially

converted into 9.6mn BUWOG shares.

• Diversification of source of funding.

Financing KPIs after placement of the convertible bond

(based on Q1 2016/17 figures)

• Ø interest rate 1.90%

• Ø maturity 14 years

• Ø lock-in period 12 years

Convertible Bonds - Use of proceeds

Capex program: EUR 40mn

Refinancing: EUR 40mn

Remaining net proceeds: > EUR 200mn

Portfolio acquisition(s) in Germany

Land site acquisition(s) in Berlin, Hamburg and Vienna

32

Successful refínancing of senior debt


Signing on 27 Oct 2016

• EUR 550mn refinancing of DGAG portfolio acquisition and subsidised

loans

• Consortium of Berlin Hyp and Helaba

• Lowering of group interest coupon from Ø 2.17% pre

convertible and refinancing to approx. 1.76% post convertible

and refinancing

• Waiver of amortisation brings additional free cash flow

• Closing expected end of January 2017

• Maturity 30 April 2024

Financing KPIs after CB and refinancing of senior debt

(based on Q1 2016/17 figures)

• Ø interest rate 1.76%

• Ø maturity 13 years

• Ø lock-in period 11 years

Refinancing benefits

Improvement of financial result p.a.: EUR 4.0mn

Savings of amortisation p.a.: EUR 13.0mn

Elimination of EUR 192mn subsidised loans in Germany and

resulting rental growth potential once rental capping periods

have run out

POST Q1 2016/17: REFINANCING OF

SENIOR DEBT UNLOCKS FURTHER VALUE

Subsidised loans 23%

Structure of amount outstanding

by type of financing (per 31 Jul2016)

Total nominal

amount:

EUR 2,135mn

CURRENT DEBT STRUCTURE

Debt Maturity Profile

Basis: outstanding liabilities in EURmn p.a. as per 31 Jul 2016 and convertible bonds placed on 6 Sept2016

33

Bank loans 77%

Ø interest rate of 2.17%

Cash financing costs of EUR -9mn only.

After the balance sheet date

• BUWOG placed 5 years convertible bonds of EUR 300mn with a zero coupon

• BUWOG refinanced mortgage loans with a volume of EUR 550mn to lower financing

cost on this tranche of debt by 60 bps to approx. 1.5% p.a. and to eliminate

amortisation payments for this debt tranche altogether leading to positive cash flow

effects of EUR 17mn p.a.

• Current Ø interest rate 1.76%

• Current Ø maturity 13 years

Key facts & KPIs (based on Q1,

adapted for refinancing & convertible bonds)

Total amount ~ EUR 2.4bn

LTV ~46%

Ø maturity 12.6 yrs

Interest lock-in period 10.5 yrs

Ø interest rate 1.76%

Loan structure Hedged &

Fixed interest loans 85%

Variable interest loans 15%

Highlights Q1 2016/17

Ø interest rate:

1.50%

Ø interest rate:

2.37%

Financing- Key Facts and Figures

September 09, 2021

Convertible bonds will be

redeemed at par (if not

previously converted)

59 59 55 55 55

55 52 48 47 46

535

37 53 45 16 18

42 26

633

9 16

139

300

by07/2017

by07/2018

by07/2019

by07/2020

by07/2021

by07/2022

by07/2023

by07/2024

by07/2025

by07/2026

from08/2026

regular repayments final repayments convertible bonds

GUIDANCE

35

GUIDANCE FY2016/17E CONFIRMED POST Q1

Guidance

Asset Management

&

Unit Sales

without acquisitions.

Unit sales of 600 units.

Block sales of 600 units.

L-f-l rental growth of 2.5% - 3%.

Property Development

Completion of 421 units in FY 2016/17e

Germany: 209 units.

Austria: 212 units.

Dividend payout ratio 65% of Recurring FFO

Recurring FFO guidance

EUR

90mn

Cap rate

Adopted capitalisation guideline of investments in line with market’s

best practice should lead to FFO accretion. EUR

5mn

EUR

13mn

min.

min.

min.

EUR

108mn min.

APPENDIX

30 Apr 16 31 Jul 16


Monthly net in-place rent EUR/sqm 4.20 4.44

Like-for-like rental growth(4) in % 0.3% 6.1%

Vacancy rate in % 4.7% 4.5%

Fair Value Portfolio EURmn 2,065 2,060

30 Apr 16 31 Jul 16






30 Apr 16 31 Jul 16






37

HIGHLIGHTS Q1 2016/17

Appendix Highlights Q1 2016/17

(1) EBITDA adjusted to account for valuation affects and deferred periods (IFRS 5)

(2) Investment volume excluding calculated cost of equity

(3) Definition: Sales minus capitalised and non-capitalised costs before tax (= investment volume excl. cost of equity) in relation to investment volume excl. cost of equity

(4) Comparison 31Jul16 vs. 31Jul15, as well as 30 Apr16 vs. 30Apr15

30 Apr 16 31 Jul 16

Total investment volume(2) EURmn 2,480 2,541

in units 8,121 8,897

Margin on investment volume(3) (based on transferred units)

in % 18% 19%

Development KPIs

Group Portfolio

German Portfolio

Austrian Portfolio

Q1 2015/16 Q1 2016/17 Change

NOI Asset Management EURmn 37.2 38.5 3.5%

NOI Property Sales EURmn 9.6 9.6 -0.3%

thereof Unit sales EURmn 7.9 9.6 21.6%

NOI Development EURmn 1.7 -0.9 n.a.

EBITDA(1) EURmn 43.4 39.2 -9.6%

EBITDA / share EUR 0.44 0.39

Recurring FFO EURmn 25.1 27.0 7.5%

Recurring FFO / share EUR 0.25 0.27

Earnings Data

30 Apr 16 31 Jul 16 Change

EPRA Net Asset Value EURmn 2,013.2 2,143.8 6.5%

EPRA Net Asset Value /

share EUR 20.18 21.49

LTV in % 47.6% 46.4%

Asset and Financial Data

38

SEGMENT KPIS Q1 2016/17

Appendix Highlights Q1 2016/17

Q1 2015/16 Q1 2016/17

EBITDA Asset Management EURmn 33.6 31.6

EBITDA Asset Management / share EUR 0.34 0.32

EBITDA Asset Managment margin in % 67.9% 59.9%

EBITDA Property Sales EURmn 8.4 9.4

thereof unit sales EURmn 7.78 9.43

EBITDA Property Sales / share EUR 0.08 0.09

EBITDA Property Sales yield(1) in % 37.0% 54.6%

EBITDA Development EURmn 1.4 -1.8

EBITDA Development / share EUR 0.01 -0.02

EBITDA Development yield(1) in % 7.5% -11.8%

Q1 2015/16 Q1 2016/17

FFO Asset Mgt EURmn 17.6 20.5

FFO margin Asset Mgt in % 35.5% 38.9%

FFO Unit Sales EURmn 7.1 8.8

FFO Unit Sales yield(1) in % 53.0% 52.4%

FFO Development EURmn 0.4 -2.3

FFO Development yield(1) in % 2.2% -15.2%

Total Recurring FFO EURmn 25.1 27.0

EBITDA Recurring FFO

30 Apr 16 31 Jul 16

Net financial debt

Asset Mgt & Property Sales EURmn 1,869.0 1,930.0

LTV Asset Mgt & Property Sales in % 50.3% 50.1%

Net financial debt

Development EURmn 101.1 113.1

LTV Development in % 24.1% 20.4%

Economic LTV Development(2) in % 15.7% 10.6%

Asset and Financial Data

(1) In relation to carrying amount of properties sold / cost of real estate inventories sold

(2) Financial liabilities netted with down payments received from purchasers

39

PORTFOLIO BY GEOGRAPHIC CLUSTER

as of 31 July 2016

No. of units in% of total

units

Total floor

area

in sqm

Annualised net

in-place rent(1)

in EURmn

Monthly net in-

place rent1)

in EUR / sqm

Fair value2)

in EURmn

in% of total

Fair value

Fair value2)

in EUR / sqm

Gross rental

Yield3)

Vacancy

rate4)

Federal capitals 11,574 23% 907,671 60.4 5.72 1,510 39% 1,664 4.0% 3.1%

Vienna 6,581 13% 575,983 35.9 5.40 1,026 27% 1,781 3.5% 3.9%

Berlin 4,993 10% 331,688 24.4 6.25 484 13% 1,461 5.0% 1.8%

State capitals and major cities5) 19,747 39% 1,275,639 75.7 5.06 1,254 33% 983 6.0% 2.3%

Lübeck 6,276 12% 363,791 24.5 5.74 383 10% 1,052 6.4% 2.2%

Kiel 3,284 6% 198,147 14.0 5.96 222 6% 1,120 6.3% 1.3%

Villach 2,744 5% 196,437 8.7 3.80 114 3% 581 7.7% 2.2%

Kassel 1,508 3% 107,292 5.3 4.37 71 2% 657 7.5% 5.4%

Braunschweig 1,439 3% 83,540 5.7 5.80 86 2% 1,032 6.6% 1.8%

Graz 1,140 2% 85,805 4.3 4.25 90 2% 1,049 4.8% 0.9%

Lüneburg 702 1% 51,076 3.4 5.80 49 1% 951 7.0% 4.0%

Innsbruck 701 1% 51,578 2.5 4.06 78 2% 1,518 3.2% 1.7%

Salzburg 671 1% 44,661 2.3 4.38 68 2% 1,517 3.4% 1.1%

Klagenfurt 567 1% 42,149 1.9 3.86 26 1% 610 7.2% 4.5%

Linz 470 1% 34,563 1.7 4.31 42 1% 1,208 4.1% 3.1%

Hamburg 245 0% 16,601 1.3 6.79 26 1% 1,578 5.0% 2.7%

Suburban regions6) 7,994 16% 560,480 31.9 4.92 542 14% 966 5.9% 3.8%

Hamburg 2,868 6% 176,564 11.8 5.61 195 5% 1,104 6.1% 0.6%

Klagenfurt 1,406 3% 100,797 4.5 3.95 76 2% 758 5.9% 4.8%

Villach 1,105 2% 86,218 3.7 3.94 59 2% 681 6.2% 9.9%

Berlin 529 1% 33,987 2.0 5.21 22 1% 641 9.1% 7.0%

Vienna 449 1% 37,031 2.1 4.84 52 1% 1,408 4.0% 3.7%

Salzburg 437 1% 34,271 2.3 5.78 52 1% 1,526 4.4% 3.5%

Graz 422 1% 31,834 1.8 4.81 27 1% 849 6.6% 2.4%

Kiel 414 1% 31,970 2.2 5.96 26 1% 800 8.7% 2.6%

Innsbruck 235 0% 20,288 1.0 4.14 28 1% 1,379 3.6% 0.0%

Brunswick 129 0% 7,521 0.5 5.37 5 0% 630 10.1% 1.6%

Rural areas 11,586 23% 776,378 38.5 4.40 547 14% 704 7.1% 6.0%

Rural areas Germany 6,903 14% 493,687 20.7 3.75 323 8% 653 6.4% 7.0%

Rural areas Austria 4,683 9% 282,690 17.9 5.51 224 6% 793 8.0% 4.2%

Total BUWOG Group 50,901 100% 3,520,169 206.5 5.07 3,852 100% 1,094 5.4% 3.6%

thereof Austria 23,831 47% 1,835,301 93.4 4.44 2,060 54% 1,123 4.5% 4.5%

thereof Germany 27,070 53% 1,684,868 113.0 5.74 1,792 47% 1,063 6.3% 2.5%

(1) Based on monthly net in-place rent (excluding utilities) as of balance sheet date

(2) Based on fair value of standing investments according to CBRE valuation reports as of 31 Jul 2016 for German portfolio and internal valuation for Austrian portfolio as of 31 Jul2016

(3) Annualised total net in-place rent (based on monthly net in-place rent excluding utilities as of the reporting date) in relation to fair value

(4) Based on sqm; 2.4.% adjusted by vacancy of unit sales

(5) More than 50,000 inhabitants and a significant share of the portfolio

(6) The immediate catchment area up to about 15km around federal capitals, state capitals and major cities

Appendix Asset Management

PORTFOLIO

Development of the Portfolio in Q1 2016/17


40

• Number of units decreased in Q1 2016/17 mainly due to the Property

Sales business in Austria:

• 155 units from Unit and Block Sales with a fair value of EUR 17mn

• Q1 16/17 valuation result of EUR 146.5mn thereof

• Germany EUR 137.4mn (prepared by external appraiser CBRE mainly

due to yield compression)

• Austria: EUR 9.1mn (prepared internally mainly due to sales price

potential)

Portfolio – Fair Value in EURmn

3,716

3,852

- 17

147 6

3.000

3.100

3.200

3.300

3.400

3.500

3.600

3.700

3.800

3.900

4.000

Fair value30Apr16

Block & Unit Sales Valuation capex Fair value31Jul16

No. of units:

50,901

Austria 46.8%

Germany 53.2%

Split of portfolio per region

in % of no. of units

41

VALUATION RESULT Q1 2016/17

Valuation result of EUR 147mn

Valuation result: EUR 146.5 mn

Market rent increases 8.5%

Yield compression 76.0%

Property management 9.4%

Sales price potential 6.1%

Split of valuation result

in %

Valuation

result in

EURmn

capex in

EURmn

Fair value

in EURmn

Fair value

per sqm

in EUR

Monthly

net in-place

rent3)

in EUR per sqm

Multiple

Federal capitals 72.4 2.1 1,510 1,664 5.7 25.0

Vienna 8.8 1.4 1,026 1,781 5.4 28.5

Berlin 63.6 0.7 484 1,461 6.3 19.8

State capitals and major cities1) 66.2 2.4 1,254 983 5.1 16.6

Suburban regions2) 6.8 0.6 542 966 4.9 17.0

Rural areas 1.1 1.3 547 704 4.4 14.2

Total BUWOG Group 146.5 6.4 3,852 1,094 5.1 18.7

thereof Germany 137.4 3.0 1,792 1,123 5.7 15.8

thereof Austria 9.1 3.4 2,060 1,063 4.4 22.0

• Positive valuation result mainly in

the following cities:

• Berlin: EUR 63.6mn

• Lübeck: EUR 32.3mn

• Kiel: EUR 23.6mn

• Vienna: EUR 8.8mn

• Q1 16/17 valuation result of EUR 146.5mn thereof

• Germany EUR 137.4mn

(prepared by external appraiser CBRE mainly driven by yield

compression)

• Austria EUR 9.1mn

(prepared internally mainly driven by adjustments in sales price

potential)

Split of valuation result per region

(1) More than 50,000 inhabitants and a significant share of the portfolio

(2) The immediate catchment area up to about 15km around federal capitals, state capitals and major cities

(3) Based on monthly net in-place rent (excluding utilities) as of the balance sheet date


ASSET MANAGEMENT

Adjustments relate to refund of RETT and allocated received

commission (EUR -2.8mn) in Q1 2015/16 and to allocated one-

off expenses in connection with SAP implementation (EUR

1.1mn)

Results Asset Management

42


NOI Asset Management in EURmn


Rental revenues 49.4 52.7 6.8%

NOI Asset Management 37.2 38.5 3.5%

Other operating income 3.2 0.6 -81.4%

Expenses not directly attributable -6.7 -7.5 13.2%

EBITDA Asset Management 33.6 31.6 -6,1%

Cash interest expenses -10.2 -9.8 -3.6%

Cash taxes -3 -2.4 -19.4%

FFO adjustments -2.8 1.1 140.2%

Recurring FFO Asset Management 17.6 20.5 16.3%

37,2 38.5 1,1 0,1

- 0.6

1.2

- 1.3

0,6

0,0

5,0

10,0

15,0

20,0

25,0

30,0

35,0

40,0

45,0

NOI AssetManagementQ1 2015/16

Rental Increase Vacancy rate Property Sales Change inmaintenance &improvementcontribution

liabilities

Expenses directlyrelated to

investmentproperties

Acquisitions NOI AssetManagementQ1 2016/17

EBITDA Asset Management adj.

Q1 2015/16 Q1 2016/17

EBITDA Asset Management 33.6 31.6

EBITDA margin 67.9% 59.9%

Adjustment -2.8 1.1

EBITDA Asset Management adj. 30.8 32.7

EBITDA margin adj. 62.2% 62.0%

As a result of a change in the

Austrian rental law (“WGG Novelle”):

tenant contributions are repayable if

not spent by BUWOG after 20 years

Like-for-like rental

increase 4.2%

As a result of higher

maintenance costs

ASSET MANAGEMENT

Comments

• In Austria property management costs may be charged to

tenants, while in Germany these costs cannot be charged to

tenants resulting in a difference in reporting: while these costs

are reported under operating expenses in Austria, in Germany

they are reported under expenses directly related to

investment property.

• Operating costs charged to tenants and facility management

revenues also contain property management services for third

parties carried out by BUWOG.

Results of Asset Management – Segment reporting

43


in EURmn Germany Austria Total

Residential rental income 26.7 23.0 49.6

Other rental income 1.9 1.2 3.1

Rental revenues 28.6 24.2 52.7

Operating costs charged to tenants and

facility management revenues 16.9 12.4 29.3

Other revenues 0.0 0.0 0.0

Revenues 45.5 36.6 82.0

Expenses directly related to investment

property -8.6 -5.5 -14.2

Operating expenses -16.7 -12.7 -29.4

NOI Asset Management 20.2 18.3 38.5

NOI margin Asset Management 70.6% 75.7% 72.9%

NOI Asset Management adj.

Q1 2015/16 Q1 2016/17

NOI Asset Management 37.2 38.5

NOI margin 75.1% 72.9%

Adjustment 0.8 0.6

NOI Asset Management adj. 38.0 39.1

NOI margin adj. 76.7% 74.0%

NOI Asset Management

• BUWOG’s NOI Asset Management also contains allocated

overhead expenses amounting to EUR 0.6mn in Q1 2016/17.

To be comparable we also report an NOI Asset Management

adjusted for allocated overheads.

• Reduction in NOI margin adj. is mainly due to higher

maintenance costs.

DEVELOPMENT: LAND PLOT ACQUISITION

Property plots acquired in Q1 2016/17

44

Project / Location Signing Closing No of

units

Floor area

(in sqm)

Investment

volume in

EURmn 2)

Fair value

in EURmn

"MGC-Plaza",

Döblerhofstrasse, 1030 Vienna, Austria 1) 07/2016 - 378 28,205 93.4 -

"Himberger Straße, Rothneusiedel",

1100 Vienna, Austria 2) 07/2016 07/2016 420 31,500 85.3 -

Total (as of 31 July 2016) 798 59,705 175.7 0.0

(1) Closing expected at the end of 2016

(2) Investment volume excluding cost of equity

(3) No external valuation per 31 July 2016; due to non-disclosure agreement with vendor, FV will not be reported per 31 July 02016

Project / Location Signing Closing No of

units

Floor area

(in sqm)

Investment

volume in

EURmn 2)

Fair value

in EURmn 3)

„Vorgartenstraße",

1020 Vienna, Austria 04/2016 05/2016 165 12,420 27.4 n.a.

"Mariendorfer Weg",

Berlin-Neukölln, Germany 02/2016 05/2016 561 44,160 167.5 n.a.

"Stuhlrohrquartier"

Hamburg-Bergedorf, Germany 04/2016 06/2016 1,279 100,170 444.3 n.a.

Total (as of 31 July 2016) 2,005 156,750 639.2

Property plots acquired in FY 2015/16 but closed in Q1 2016/17

Appendix Development

45

DEVELOP–TO–HOLD: PIPELINE

Project Location

No of

units

No. of

parking

spaces

Floor area (in `000

sqm)

Investment volume (1)

Monthly net in-

place rent (in EUR/sqm)(2)

Gross

rental

yield

Rent

parking (in EUR/

month)(3)

Tenant

contribution (in EURmn)

Planned

completion

Total (in

EURmn)

Spent (in %)

Remaining (in %)

Ankerviertel Berlin 86 86 7.7 25.5 14% 86% 12.0 4.7% 100.0 0.0 03/2018

Am Otterweg Vienna 88 73 7.0 15.8 89% 11% 5.6 4.3% 63.0 3.5 08/2016

Southgate Vienna 78 61 5.9 12.0 72% 28% 5.2 4.4% 50.8 2.9 11/2016

Breithenfurther Vienna 100 65 8.3 18.0 39% 61% 5.5 4.2% 59.0 4.1 08/2017

Total under construction 352 285 28.9 71.3 47% 53% 7.2 4.5% 70.6 10.6

Develop-to-hold: future pipeline (per 31Jul16)

Location No of units

No. of

parking

spaces

Floor area (in `000

sqm)


Land cost (in EUR/sqm)

Total (in EURmn

Spent (in %)

Remaining (in %)

Berlin 847 696 64.3 236.0 9% 91% 424

Hamburg 304 150 18.2 71.6 19% 81% 608

Vienna 1,494 948 108.3 233.5 9% 91% 262

Total future pipeline 2,645 1,794 190.9 541.1 10% 90% 385

Develop-to-hold: under construction (per 31Jul16)

(1) Excl. calculated cost of equity

(2) Expected initial monthly net in-place rent (in EUR/sqm)

(3) Expected initial rent per parking space (in EUR/month)

Project “Ankerviertel”

Currently the project “Ankerviertel” is reported under inventories. In H1 2016/17 it will be transferred to Investment properties under construction as an

external fair value valuation for the development assets will only be done twice a year.

Under Inventories the assets are measured at cost while Investment properties under construction are measured at FV.


46

DEVELOP–TO–SELL: PIPELINE

Location

No of

units

No. of

parking

spaces Floor area

(in `000 sqm)


Est. sales price (in EUR/sqm)

Presales (in %)

Total (in EURmn)

Spent (in %)

Remaining (in %)

Berlin 553 485 51.7 175.8 32% 68% 3,796 51%

Vienna 464 421 40.8 154.1 40% 60% 4,505 36%

Total under construction 1,017 906 92 329.9 36% 64% 4,109 49%

Location No of units

No. of parking

spaces Floor area

(in `000 sqm)


Land cost (in EUR/sqm)

Total (in EURmn)

Spent (in %)

Remaining (in %)

Berlin 1,729 1,246 153.3 598.6 14% 86% 735

Hamburg 975 850 82.0 372.8 16% 84% 718

Vienna 2,179 2,354 186.1 627.8 16% 84% 662

Total future pipeline 4,883 4,450 421.4 1,599.2 15% 85% 698

Develop-to-sell: under construction per Q1 2016/17

Develop-to-sell: future pipeline per Q1 2016/17

(1) Excl.. calculated cost of equity


420

103 25

971 962

1.369

FY 2015/16

Q12015/16

Q12016/17

Completed units Units under construction

47


DEVELOPMENT

Results Development Q1 2016/17

Negative Q1 2016/17 results in development due to planned low

volume of completions the development business (25 units

completed and 58 units sold and transferred in Q1 2016/17) and

increasing number of units under construction.

Guidance for FY 2016/17 remain unchanged with min. EUR 13mn

Property Development activity

Investment value of development projects (1) as of 31 Jul 2016

Berlin EUR 1,036mn

Hamburg EUR 444mn

Total investment volume:

EUR 2.5bn

Vienna EUR 1,061mn


NOI Development 1.7 -0.9 -149.5%

Other operating income 0.4 0.1 -77.8%

Expenses not directly attributable -0.7 -1.0 -32.8%

EBITDA Development(1) 1.4 -1.8 -231.8%

Cash interest expenses -0.6 -0.6 -1.9%

Cash taxes -0.1 0.0 83.8%

FFO adjustments -0.3 0.1 197.0%

Recurring FFO Development 0.4 -2.3 -611.9%

(1) EBITDA is equivalent to EBIT within the development business

(1) Beginning with FY 2016/17, the total investment volume will be represented excl. interest on

equity to provide greater transparency

DEVELOPMENT


Results Q1 2016/17 – segment split

Austria / Vienna:

Result of Property Development in Austria related to the sales of

completed projects in FY 2015/16 – see main sales below:

Samhaberplatz 15 units / EUR 4.3mn

Skytower 6 units / EUR 2.5mn

Am Otterweg 3 units / EUR 1.3mn

Other expenses also include non-capitalised expenses such as

marketing costs for projects under construction and projects with

a planned construction start in FY 2016/17 and following years.

Germany / Berlin:

The development result in Germany was mainly influenced by the

sale of the following development projects:

22 units of the “Uferkrone” project were sold for EUR 6.7mn

3 units of the project Gervin&Wilmers were sold for EUR

1.3mn

Other expenses also include non-capitalised expenses for

projects under construction and projects with a planned

construction start in FY 2015/16 and following years.

48

in EURmn Germany Austria Total

Sale of real estate inventories 8.1 10.3 18.4

Cost of real estate inventories sold -7.4 -7.7 -15.1

Other expenses from sale of real estate inventories -0.7 -0.7 -1.4

Real estate development expenses -1.0 -1.7 -2.7

Results of properties sold and available for sale 0.0 0.0 0.0

NOI Development -1.1 0.2 -0.9

Average sales price EUR 3,500 / sqm (completed and transferred units)

• Vienna: EUR 3,500 / sqm

• Berlin: EUR 3,600/ sqm

in EURmn Q1 2015/16(1) Q1 2016/17 Change

Rental revenues 49.4 52.7 7%

NOI of Asset Management 37.2 38.5 3%

NOI of Property Sales 9.6 9.6 0%

NOI of Property Development 1.7 -0.9 -150%

Other operating income 3.6 0.7 -81%

Expenses not directly attributable -8.0 -9.3 15%

Result of operations 44.0 38.6 -12%

Other revaluation results 16.0 146.5 818%

EBIT 60.1 185.2 208%

Financial result 63.0 -83.0 -232%

EBT 123.1 102.2 -17%

Income tax expenses -3.8 -3.1 -20%

Deferred tax expenses -22.7 -15.2 -33%

Net profit 96.6 83.9 -13%

EBITDA 43.3 39.2 -10%

49

Comments:

Q1 2016/17 is mainly influenced by 58 transferred

units and increased units under construction.

Previous quarter included received commission for

liabilities incurred EUR -1.2mn as well as one-off item

in connection with a previous acquisition (refund of

RETT) EUR -2mn.

Revaluation result of EUR 146mn due to yield

compression in Germany (EUR 137mn) and sales

price adjustment in Austria (EUR 9mn)

Influenced by negative non-cash valuation effects

(driven by decreasing interest rate) of EUR 71mn.

Cash financing costs amounted to EUR -9mn in Q1

2016/17.

Influenced by valuation results (investment properties,

loans and derivatives)

INCOME STATEMENT Q1 2016/17

Consolidated income statement Q1 2016/17

Appendix Financial Results

(1) Change in the comparative information: adoption of the capitalisation policy of investments amounting to EUR 1.7mn

in EURmn 30 Apr 16(1) 31 Jul 16 Change

Investment properties 3,885.0 4,139.0 7%

Properties under construction 33.0 38.1 15%

Other assets 70.4 47.1 -33%

Non-current assets 3,988.4 4,224.1 6%

Non-current assets held for sale 0.0 0.0 -

Inventories 217.3 230.0 6%

Cash and cash equivalents 82.5 101.7 23%

Other current assets 155.9 127.7 -18%

Current assets 455.7 459.4 1%

Total assets 4,444.1 4,683.5 5%

Equity 1,700.0 1,782.1 5%

Financial liabilities 2,052.7 2,145.0 4%

Deferred tax liabilities 207.8 229.0 10%

Other non-current liabilities 129.1 154.1 19%

Other current liabilities 354.5 373.4 5%

Total equity and liabilities 4,444.1 4,683.5 5%

50

BALANCE SHEET Q1 2016/17

Consolidated Balance Sheet Q1 2016/17

Comments:

Mainly influenced by revaluation of EUR 147mn,

Property Sales of EUR -17mn and land site

acquisitions.

Inventories and properties under construction

contain development projects with 1,369 units

that are currently under construction and 1,181

units with a planned construction start in FY

2016/17.

Mainly driven by a positive operating cash flow.

Positive financing cash flow (EUR 32mn) due to

prolongation of mainly working capital loans and

negative investment cash flow due to

investments in property development (EUR -

43mn).

Includes ordinary bank loans of approx.

EUR 1,641mn and subsidised loans of approx.

EUR 504mn.


17,2 17,4

7,9 9,6

Q1 2015/16 Q1 2016/17

Unit Salesresult

FFO

in EURmn Q1 2015/16

(old cap rate)

Q1 2015/16

(new cap rate) Q1 2016/17 Change(1)

Net profit 96.6 96.6 83.9 -13%

Results of Property Sales -9.6 -9.6 -9.6

Other financial result -73.7 -73.7 72.6

Fair value adjustments of investment properties -17.6 -16.0 -146.5

Impairment losses/revaluations 0.4 0.4 0.6

Deferred taxes 22.7 22.7 15.2

Other -3.1 -3.1 1.3

FFO 15.6 17.2 17.4 12%

Unit Sales result 7.9 7.9 9.6 21%

Recurring FFO 23.5 25.1 27.0 15%

Block Sales result 1.2 1.2 0.0 -98%

Total FFO 24.7 26.3 27.1 10%

Recurring FFO 23.5 25.1 27.0 15%

CAPEX -2.3 -4.0 -6.4 174%

AFFO 21.1 21.1 20.6 -2%

51

FUNDS FROM OPERATIONS Q1 2016/17


Recurring FFO development

in EURmn

Funds from Operations

25.1 27.0

Comments:

Net Profit mainly influenced by slightly lower

operating result (negative development result and

lower other operating income, mainly one-offs in the

previous quarter) as well as by negative non-cash

revaluation result of derivatives and loans which

was partly offset by positive property valuation

result.

Adjustment of non-cash items (mainly negative

valuation effects of loans and derivatives totalling

EUR 71mn and effects from valuation of loans at

amortised cost totalling EUR -1mn).

Adjustment of mainly one-off expenses in

connection with SAP implementation (EUR 1.3mn).

Increased Recurring FFO due to increased NOI

Asset Management and Unit Sales.

Change in comparative information (new cap rate)

Q1 2015/16 figures were adjusted for the new capitalisation policy amounting to EUR 1.6mn.

(1) Relate to changes Q1 2015/16 (old cap rate) to Q1 2016/17

2.013,2

2,143.8

83,9 23,8

23,6

- 0.6

1.500

1.600

1.700

1.800

1.900

2.000

2.100

2.200

EPRA NAV30Apr16

Net profit after non-controlling interests

Deferred taxes FV of derivative financialinstruments

Changes in the FV ofinventories

EPRA NAV31Jul16

52

EPRA NAV Q1 2016/17

EPRA NAV in EURmn

FY 2015/16 EPRA NAV was mainly influenced by the net profit after non-controlling interests, amounting to EUR 84mn.

(besides NOI of Asset Management and Property Sales mainly influenced by valuation result of EUR 147mn).

Changes of deferred taxes due to valuation results (investment properties, loans and derivatives).

Adjustment for the fair value valuation effect of derivatives.

Comments

EPRA NAV/share

EUR 21.49 EPRA NAV/share

EUR 20.18

Increase by EUR 1.31

(1)


(1) Also including EUR 0.2mn changes in FV of properties owned and used by BUWOG

82.5

101.7 30,2

-99.2

55,6 0,9

52,4

-9.7

-9.3 -1.8

0,0

20,0

40,0

60,0

80,0

100,0

120,0

140,0

Cash and cashequivalents(EURmn)30Apr16

Operatingactivities

Acquisitions Unit & BlockSales

Other New Loans Repayment offinancial liabiliies

Cash financingcosts

Other Cash and cashequivalents(EURmn)31Jul16

Contribution from operating activities amounted to EUR 30mn relating to Asset Management and Property Development.

Gross Contribution from Property Sales amounted to EUR 56mn and is shown under investing activities while the repayment of debt

relating to Property Sales is shown under financing activities (EUR 7mn).

CF from acquisition (EUR -99mn) mainly contains investments in standing investments and purchase of land sites for development

purposes.

CF from financing activities is mainly driven by prolongation of loans, repayments of loans and financing costs.

53

CASH FLOW Q1 2016/17

CF Q1 2016/17 was mainly influenced by investing activities


CF from investing activities

EUR – 42.6mn

(1) Including revenues of property sales (EUR 27.7mn) and changes in receivables relating to property sales (EUR 28.0mn)

CF from financing activities

EUR 31.6mn

(1)

54

REVIEW FINANCIAL RESULT Q1 2016/17

Non-cash and one-off

items are adjusted

within the Recurring

FFO calculation

Development of the EUR swap curve

31 July 2015 to 30 April 2016 and 31 July 2016, in %

Financial result Q1 2016/17 predominantly influenced by negative non-cash and one-off items (EUR 72.6mn)

Negative non-cash result from valuation of derivatives and financial

liabilities (EUR 71.4mn) due to fair value accounting (driven by lower

reference interest rate)

Negative valuation effect from financial instruments at amortised cost, i.e.

in particular non-subsidised loans which are measured at amortised cost

rather than fair value

in EURmn Q1 2016/17

Finnancing costs- cash -9.3

FV valuation of derivatives -23.6

FV valuation of loans -47.8

Non-cash valuation @ amortised costs -0.7

Other -1.6

Financial result -83.0

thereof non-cash & one-off -72.6


in EURmn FY 2014/15 FY 2015/16 Change

Rental revenues 187.7 199.4 6%

Results of Asset Management 128.3 136.1 6%

Results of Property Sales 42.1 38.2 -9%

Results of Property Development 12.5 21.4 72%

Other operating income 7.8 7.5 -4%

Expenses not directly attributable -32.2 -33.0 2%

Result of operations 158.5 170.3 7%

Other revaluation results 110.0 178.8 63%

EBIT 268.5 349.1 30%

Financial result -216.9 -41.0 -81%

EBT 51.6 308.2 >100%

Income tax expenses -10.7 -18.0 68%

Deferred tax expenses -0.2 -50.2 >100%

Net profit 40.7 239.9 >100%

EBITDA (1) 158.6 174.3 10%

55

Comments:

In previous year DGAG and Apollo results

contributed for 10 months only.

FY 2015/16 is mainly driven by 3 completed

projects in Vienna and 3 projects in Berlin.

Revaluation result of EUR 178mn, thereof EUR

191mn based on CBRE valuation report for

investment properties. Other revaluation result also

includes a negative contribution of EUR 12mn from

increased maintenance liability to tenants

recognition based on a change in Austrian rental

law (“WGG Novelle”).

Influenced by non-cash valuation effects (driven by

decreasing interest rate). Cash interest expenses

amounted to EUR -49mn in FY 2015/16.

Deferred tax expenses are largely influenced by fair

value valuation of standing investments.

INCOME STATEMENT FY 2015/16

Consolidated income statement FY 2015/16


(1) Results of operations adjusted to account for valuation effects add deferred periods (IFRS 5)

in EURmn 30 Apr 15(1) 30 Apr 16 Change

Investment properties 3,620.8 3,885.0 7%

Properties under construction 14.6 33.0 >100%

Other assets 41.9 70.4 68%

Non-current assets 3,677.3 3,988.4 8%

Non-current assets held for sale 5.8 0.0 -100%

Inventories 197.6 217.3 10%

Cash and cash equivalents 149.2 82.5 -45%

Other current assets (1) 150.9 155.9 3%

Current assets 503.5 455.7 -9%

Total assets(1) 4,180.8 4,444.1 6%

Equity 1,524.3 1,700.0 12%

Financial liabilities 2,105.4 2,052.7 -3%

Deferred tax liabilities 159.3 207.8 30%

Other non-current liabilities 122.1 129.1 6%

Other current liabilities(1) 269.7 354.5 31%

Total equity and liabilities(1) 4,180.8 4,444.1 6%

56

BALANCE SHEET FY 2015/16

Consolidated Balance Sheet FY 2015/16

Comments:

Mainly influenced by revaluation of EUR 191mn,

Property Sales of EUR -87mn and acquisitions

of EUR 39mn.

Inventories and properties under construction

contain development projects with 971 units that

are currently under construction and 2,488 units

with a planned construction start in FY 2016/17.

Mainly driven by a negative investment cash

flow due to investments in property

development (closing of 7 land plot acquisitions)

as well as a negative financing cash flow due to

amortisation of financial liabilities, dividend

payment and interest payments.

Includes ordinary bank loans of approx.

EUR 1,601mn and subsidised loans of approx.

EUR 492mn (total nominal amount of EUR

2.09bn with a carrying amount of EUR 2.05bn).

(1) Change in comparative information: The initial application of IFRIC 21 led to an increase of EUR 3.5mn


56,8 64,8

34,9 34,6

FY 2014/15 FY 2015/16

Unit Sales

FFO

in EURmn FY 2014/15 FY 2015/16 Change

Net profit 40.7 239.9 490%

Results of Property Sales -42.1 -38.2

Other financial result 171.1 -7.1

Fair value adjustments of investment properties -106.7 -190.8

Impairment losses/revaluations -1.8 1.8

Deferred taxes 0.2 50.2

Other -4.6 9.1

FFO 56.8 64.8 14%

Unit Sales result 34.9 34.6 -1%

Recurring FFO 91.7 99.4 8%

Block Sales result1) 5.7 3.6 -36%

Total FFO 97.4 103.0 6%

Recurring FFO 91.7 99.4 8%

CAPEX -17.3 -18.2 5%

AFFO 74.4 81.2 9%

57

FUNDS FROM OPERATIONS FY 2015/16


Recurring FFO development

in EURmn

Funds from Operations FY 2015/16

91.7 99.4

Comments:

Impact of 12 months DGAG and Apollo

consolidation and cyclical property development

business.

Adjustment of non-cash items (mainly negative

valuation effects of loans and derivatives totalling

EUR 12mn and effects from valuation of loans at

amortised cost totalling EUR -2mn).

Adjustment of recognition of maintenance liabilities

to tenants under revised rental regime EUR 12mn,

received commission for liabilities incurred EUR -

3mn, one-off item in connection with a previous

acquisition (refund of RETT) EUR -2mn and other

one-off and reorganisation expenses (EUR 2mn).

Impacted by envisaged development completions in

Q4 2015/16.

(1) excluding valuation effect from non-current assets held for sale of EUR 1.5mn previous year.

10,511,512,513,514,515,516,517,518,519,520,521,522,523,524,525,5

31.12.2015 29.02.2016 30.04.2016 30.06.2016 31.08.2016 31.10.2016

BUWOG AG EPRA Developed Europe MDAX ATX

CAPITAL MARKET POSITIONING

58

BUWOG is included in the following indices:

ATX: weighted with 6%

ATX Five: weighted with 10%

IATX: weighted with 24%

FTSE EPRA/NAREIT Developed Europe

GPR 250 Index

VÖNIX Sustainability Index

Current share price of EUR 20.95 (as of 15 Nov 2016)

represents 77% (incl. dividends) increase to first trading

price on 28 April 2014

Source: Thomson Reuters ¹ Rebased on Buwog 31 Dec 2015 share price

IMMOFINANZ Group’s stake

On 09 June 2016 IMMOFINANZ Group sold 18.5mn

BUWOG shares to SAPINDA Group (price per share was

EUR 19,00) and reduced its stake by 18.5% to roughly 10%.

2 convertible bonds issued prior to BUWOG’s spin-off by

IMMOFINANZ AG outstanding entitle bondholders to convert

into IMMOFINANZ and BUWOG shares. IMMOFINANZ

intends to use its remaining 10% stake in BUWOG to service

these convertible bonds

On 19 July 2016 SAPINDA Group placed its entire 18.5mn

BUWOG shares in the market (price per share was EUR

20.25, which represents a discount of 7% to closing price)

Comments on BUWOG capital market performance BUWOG vs relevant indices (01 Jan 2016 − 25 Oct 2016)

Appendix Capital Markets

Shareholder Structure per 20 July 2016

Free float 90%

IMMOFINANZ Group for IMMOFINANZ convertible bonds

10%

Total shares 99.8mn

+5%

+5%

-14%

-1%

19 Oct. 2016

0.69€ /share dividend payment

(adjustment made on 17 Oct)

59

ANALYST COVERAGE

Analyst

Coverage


Institution Date Target price Recommendation

Baader Bank 05 Sept 2015 EUR 25.00 Buy

Bank of America Merrill Lynch 19 Mar 2016 EUR 26.00 Buy

Barclays 27 Sept 2016 EUR 27.20 Overweight

Berenberg 14 Nov 2016 EUR 25.50 Buy

Deutsche Bank 17 May 2016 EUR 23.00 Buy

Erste Bank 01 Oct 2015 EUR 21.50 Accumulate

HSBC 15 Jul 2016 EUR 32.90 Buy

Kepler Cheuvreux 01 Sept 2016 EUR 26.00 Buy

M.M. Warburg Bank 26 Aug 2016 EUR 24.70 Buy

Raiffeisen Centrobank 29 Sept 2016 EUR 24.50 Hold

Average target price per 15 Nov 2016 EUR 25.63

Analyst coverage

60

FINANCIAL CALENDAR

Financial

Calendar

21 Nov 2016 Austrian & CEE Investor Conference

New York

22 Nov 2016

30 Nov 2016

Austrian Day

Chicago

UBS Global Real Estate CEO/CFO Conference, London

5 Dec 2016 Berenberg European Corporate Conference

Surrey, UK

21 Dec 2016

16 Jan 2017

31 Jan 2017

Publication H1 Report 2016/17

Kepler Cheuvreux Unicredit German Corporate Conference, Frankfurt

Convertinvest Viennese Convertible Day, Vienna

22 Mar 2017 Publication 9-months-report FY2016/17


BUWOG AG

T: +43 1 878 28-1130

W: www.buwog.com

Stock Symbols

Frankfurt Stock Exchange: BWO GR

Vienna Stock Exchange: BWO AV

Warsaw Stock Exchange: BWO PW

ISIN: AT00BUWOG001

Holger Lueth

Head of Corporate Finance and Investor Relations

T: +43 1 878 28-1203

E: [email protected]

61

buwog group

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