AFI Development PLC May 2008
Company Overview Leading Developer in a Strong Market
A leading real estate developer leveraged to the high growth Russian real estate market
Proven Track Record
Track record of value creation through executing innovative and visionary developments that act as a catalyst for urban regeneration
Attractive Portfolio and Pipeline
A portfolio of large-scale integrated development projects and a substantial longer term pipeline
Best-in-Class Execution
Local management team with proven track record and familiarity with local authorities and procedures International best-in-class execution from origination to completion
Value Enhancing Parent Company
Leverage parent's international expertise, business practices and relationships
June 2008 2
Geographical Expansion St. Petersburg Type: Retail GLA: 15,400 sqm
Moscow
Selective targeting of major Russian cities based on:
Volgograd
Population at or over 1 million
Type: Mixed Use GLA: 114,960
Perm Type: Mixed Use (in 3 Phases) Kislovodsk June 2008
GLA: 208,584
Strong, sustainable economic growth Shortage of highquality real estate
Type: Resort GLA: 31,500
3
Ukraine & the CIS Geographic focus broadened to include Ukraine and other CIS countries We have entered the Ukrainian market through acquisition of the assets and management platform of AFI Ukraine: In-depth local market knowledge – a solid
platform for growth A number of established development opportunities
Markets have highly complementary characteristics to Russia, with positive economic growth June 2008 4
Focus on Moscow and the Moscow Region Tverskaya Zastava
Moscow City Botanic Garden Pochtovaya
Ozerkovskaya
Otradnoye
Kuntsevo
Berezhkovskaya Kosinskaya
June 2008
Paveletskaya 5
Jones Lang LaSalle - Project Portfolio Summary Portfolio Breakdown by Asset Type (sqm)
Tverskaya Zastava
Shopping Centre
Shopping Centre
100%
70,203
225.6
625.5
2010
Plaza I
Offices, hotel, residential
100%
147,895
374.7
917.3
2011
Plaza II
Offices
100%
89,820
350.5
746.5
2011
Plaza II (a)
Offices
100%
7,823
17.9
47.9
2011
Plaza IV
Offices
95%
91,278
117.9
394.2
2011
222.1
264.5
1,142.5
1,648.8
Moscow
Ozerkovskaya
Moscow & Moscow Regions 90%
Regions 10%
Notes 1. Estimated Gross Lettable Area/ Gross Sellable Area 2. Adjusted for AFID beneficial ownership 3. Responsible for 100% of the costs and entitled to 75% of the revenues. With respect to the concert hall, AFID to contribute June 2008$20 MM of the costs, but has no ownership rights 4. AFID share is 50% of office and residential, 100% of hotel 5. This table does not include latest projects in Ukraine and Kislovodsk
Expected Completion
Asset Type
City
Portfolio Breakdown by Geography (sqm)
Valuation in Valuation at Current (2) (2) (3) State Completion $ MM $ MM
Project
Retail 15%
Office 60%
GLA/ (1) GSA sqm
Development
Res 25%
Hotel 2%
AFID Beneficial Ownership
Four Winds I
Offices
50%
25,988
Four Winds II
Residential
50%
36,421
Shopping Centre
Retail, offices, concert hall
75%(3)
97,451
City Hotel
Hotel
Phase II
Offices, hotel, residential
Phase III
Offices, residential
Phase IV
Offices
Otradnoye
Otradnoye
Residential, offices, retail
Paveletskaya
Paveletskaya Embankment
Offices
49.9% 50%
2008 2009
35,564
61.6
242.8
2010
54,2035
165.3
232.0
Completed / 2008
64,124
111.18
229.8
2008
(4)
50%
Completed
70%
21,574
64.8
164.2
2010
> 90%
596,460
405.9
1,701.6
2012
100%
67,000
57.5
325.4
2009
Plaza H2O
Offices
100%
8,918
34.9
34.9
Completed
Ruza
Ruza
Land plot
100%
-
94.8
235.2
2012
Berezhkovskaya
Berezhkovskaya
Offices
74%
99,600
101.9
280.9
2011
St. Petersburg
Discount centre project
Retail
76%
15,400
18.9
47.9
2010
Perm (Kama Gate)
Phase I - III
Residential, Office, Retail
30%
208,584
12.8
220.4
2010
Volgograd
Multi-functional complex
Retail, offices, hotel
100%
89,468
26.4
440.7
2011
Kuntsevo
Kuntsevo
Offices, retail
100%
1,275,414
700.3
7,624.0
2012
100%
51,625
8.0
113.1
2010
Kislovodsk
Kislovodsk
Spa Hotel, Retail, Entertainment
Kossinskaya
Kossinskaya
Offices, retail
100%
245,279
266.1
529.3
2010
Pochtovaya
Pochtovaya
Offices, residential
100%
160,945
258.2
1,029.2
2010
Botanic Garden
Serebryakova
Residential, Retail
90%
2010
Total
72,883
73.2
515.6
3,640,561
5,221.0
19,567.0
6
Tverskaya Zastava Square Transforming look, zoning and use of a central square Over 450,000 sqm of gross leasable/sellable area across seven mixed-use commercial and residential developments: Largest underground shopping mall in Moscow Over 190,000 sqm of Class A office space across various buildings located in the proximity of the square
Projects hit market between 2007 and 2011 June 2008 7
Moscow City The Shopping Mall comprises over 130,000 sqm of retail and leisure space, a 6,000-seat concert hall, a five-star hotel and one of the largest squares in Moscow Located in the heart of the “Moscow City” district, Russia’s largest real estate development project with 1.25 mln sqm of high-quality office space being developed
June 2008 8
Ozerkovskaya Embankment Nearly 3 hectare river front neighbourhood development in the historic Moscow district of Zamoskvorechye Phase Phase II –– Aquamarine Aquamarine II office office building building completed completed and and sold sold pre pre IPO IPO Phase Phase IIII –– Aquamarine Aquamarine IIII office office building building –– completed completed and and sold sold Phase Phase IIII –– Hotel Hotel and and residential residential buildings buildings to to be be completed completed in in 2008 2008 Phase Phase III III –Mixed –Mixed use use office office building building currently currently under under construction construction
Phase IV Mixed use office building in concept and design stage June 2008 9
Otradnoye New district of suburban town of Odintsovo, 8 km west of Moscow ring road
Residential district development with almost 600,000 sqm of GLA/GSA 450,000 sqm of Economy + accommodations spread out among nine residential buildings
The compound will also include additional retail and office space The development is surrounded by woodlands and is regarded as an upscale outof-Moscow township June 2008 10
Kuntsevo 20 hectare development located in western Moscow near the Kuntsevo metro station and adjacent to the Rublevskoye highway Mixed-use commercial project totalling over 1.2 mln sqm comprising primarily Class A office space Phased development with last phase expected to be completed by 2012 June 2008 11
Pochtovaya • Multipurpose facility with office, residential, and hotel component on Rubtsovskaya Embankment • AFI Development is at an advanced stage of planning on Pochtovaya Phase I
Full zoning and permits in place
Phases II and III have been added to Phase I plot to create a single plot of 4.9 hectares. The project will be delivered in stages and will comprise almost 250,000 sqm of GLA June 2008 12
Kossinskaya An integrated multi-purpose office and retail center in Eastern Moscow-the most undersupplied area of the city with easy access to MKAD, Vyhino metro and rail stations. 111,000 sqm Class B office building is complete and fit-out Establishing concept design for highest and best use of an additional 70,000 sqm of new development.
June 2008 13
New Initiatives Hotels AFI Development acquired of four hotel properties from Africa Israel Hotels Ltd: Plaza Plaza Spa, Spa, Kislovodsk: Kislovodsk:
Operational Operational –– four-star four-star hotel hotel with with 274 274 bedrooms bedrooms
Park Park Plaza, Plaza, Kislovodsk: Kislovodsk:
Land Land plot plot over over 55 hectares; hectares; ground ground works works underway, underway, development development of of this this 500-bedroom 500-bedroom hotel hotel isis expected expected to to complete complete in in 2010 2010
Versailles, Versailles, Kislovodsk: Kislovodsk:
Project Project to to redevelop redevelop an an historic historic building building and and the the construction construction of of new new facilities, facilities, which which include include aa luxury luxury spa spa hotel hotel
Kalinina, Kalinina, Zheleznovodsk: Zheleznovodsk:
Project Project to to convert convert an an existing existing building building into into aa modern modern three-star three-star hotel hotel with with aa total total area area of of 11,500 11,500 sqm sqm (175 (175 bedrooms) bedrooms)
June 2008 14
Outlook Track Track record record and and expertise expertise of of management management continues continues to to provide provide AFI AFI Development Development with with aa competitive competitive advantage advantage Extremely Extremely strong strong portfolio portfolio and and pipeline pipeline with with massive massive potential potential Continued Continued strong strong market market conditions conditions (commercial (commercial and and residential) residential) underpinned underpinned by by growing growing interest interest from from international international investors investors and and potential potential tenants tenants –– for for example, example, at at Four Four Winds Winds Existing Existing projects projects progressing progressing with with some some completing completing early early –– AFI AFI Development Development continues continues to to create create significant, significant, landmark landmark schemes schemes Robust Robust strategy strategy continues continues to to produce produce results; results; broadening broadening geographic geographic focus focus to to include include Ukraine Ukraine and and the the CIS CIS In-house In-house ‘best ‘best in in class’ class’ construction construction management management and and development development expertise expertise –– demonstrated demonstrated by by continued continued progress progress on on planning planning and and zoning zoning permissions permissions June 2008 15
Appendix – AFI Group – Value Enhancing Parent Company
Africa Israel Investments Holding Company Ticker: AFIL (TASE)
Africa Israel Properties
Africa Israel Residential
Africa Israel Hotels
AFI USA
AFI Development
Danya Cebus
Yielding Properties
Housing in Israel
Crowne Plaza and Holiday Inn in Israel
Real Estate Development in USA
Real Estate Development in Russia
Construction & Infrastructure
AFRP (TASE)
AFRE (TASE)
AFID (LSE)
DNYA (TASE)
Steel Trade Ceramics
Danya Cebus Rus
AFI Europe Real Estate Development in CEE
Related Industries & Other Activities
SPA Hotels in Kislovodsk
Construction in Russia
June 2008 16
Appendix –– Project Case Studies AFI Development successfully executed 8 projects between 2003 – 2006, achieving substantial returns (1) Patriarshy Ponds(1)
Primary Asset Type: Residential (24,235 sqm)
Nejinskaya
(1) Palaty Muravievikh(1)
Primary Asset Type: Residential (8,490 sqm)
Aquamarine I
House of Lions(1)
Primary Asset Type: Residential (4,100 sqm)
Udaltsova
Kislovodsk(1)
Primary Asset Type: Hotel (25,998 sqm)
Ozerkovskaya Emb.(2)
Primary Asset Type: Residential (170,791 (170,791 sqm) sqm)
Primary Asset Type: Office (13,558 sqm)
Primary Asset Type: Residential (33,461 sqm)
Primary Asset Type: MixedMixed-Use (117,589 sqm)
Year Sold: 2003; 100% sold
Year Sold: 2005; 100% Share sold
Year Sold: 2006; 100% sold
Year Sold: 2006; 50% Share sold
Sale Price/ Price/ Gross Cost: 2.3x
Sale Price/ Gross Cost: 2.4x
Sale Price/ Gross Cost: 1.9x
Sale Price/ Gross Cost: 3.9x
June 2008
Notes 1. AFI Development acted as development project manager, but did not own the asset 2. 50% of Phase II and III excluding hotels
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