1 1 Company Name : TSKB REAL ESTATE INVESTMENT TRUST Date of - - PowerPoint PPT Presentation

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Company Name : TSKB REAL ESTATE INVESTMENT TRUST Date of Establishment : 03.02.2006 Share Capital : 150.000.000 TL Listing : Istanbul Stock Exchange Ticker Symbol : TSGYO Address : Meclisi Mebusan Cad. Molla Bayırı Sk. No:1 34427 Fındıklı İstanbul Web-site : www.tskbgyo.com.tr e-mail : gyo@tskb.com.tr Phone : +90 (212) 334 50 20 Fax : +90 (212) 334 50 27

Disclaimer: This presentation must be read with the disclaimer in the Appendix

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Section I

The Company

Section III

Financial Data

Section II

Real Estate Portfolio

Section IV

TSGYO Stock Performance

Section V

Appendix

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Highlights

• Aims to achieve sustainable growth – leasable area up from 3k sqm to 50k sqm in 5 years
• Asset size grew from TL12m (2006) to TL 341m (2011)
• Strong real estate portfolio with a commercial focus enabling reliable revenues derived from rental income
• Income-sharing and joint-venture projects under evaluation
• Established in 2006 as a real estate investment and development company
• Developer of new projects, has demonstrated its ability to ensure profitable project development

TSKB REIT aims to be a leading player in the Turkish real estate sector

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Vision & Mission

VISION

To be a “reliable business partner” with a “pioneering role“ in its sector.

MISSION

To establish and maintain a growing and sustainable investment portfolio with high returns.

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Shareholder Structure

 The Company is one of four subsidiaries established by TSKB in the real estate market, demonstrating the parent company’s commitment to the sector:

1. TSKB Real Estate Investment Company 2. TSKB Real Estate Appraisal 3. TSKB Real Estate Consultancy Services 4. TSKB Real Estate Brokerage Services Shareholder Stake (%) TSKB 59.00 YF Securities 1.33 TSKB Employees Pension Fund 1.04 TSKB Real Estate Appraisal 0.30 Free Float on ISE* 38.33 Total 100.00

 Experienced main shareholder, Turkey’s oldest and largest investment and development bank TSKB, part of the Is Bank Group.

Free Float 38% Other 3% TSKB 59% * As of December 31, 2011, 7,763,100 of the listed shares were held by TSKB, thus, the total share of TSKB was 64.18% as of the date given.

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Management Board

General Manager Investments Accounting and Administrative Affairs

• Accounting
• Budgeting and Planning
• Administrative Affairs

Legal Consultant Tax Consultant Property Appraiser

Organization

Finance and Investor Relations

• Project Development
• Project Management
• Asset Management
• Investor Relations
• Compliance
• Finance

Executive Vice President

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2006 2007 2008 2009 2010 2011

• TSKB REIT established in

February.

• TSKB contributed the Tahir

Han Building as capital in kind in March.

• Land for Pendorya Shopping Center

(PSC) purchased in July.

• Land

for Adana hotel project purchased in 50% partnership in November.

• Paid in capital upped from TL10m to

TL75m.

• Fındıklı

Buildings added to the Company’s portfolio in December.

• TSKB acquired the construction

permit for PSC in July.

• TSKB REIT laid the foundation for

PSC in November.

• Paid in capital was increased to

TL100m.

• PSC completed and opened

to shoppers in December.

• TSKB REIT on the ISE in April.
• Paid in capital was increased to

TL150m.

History

• Construction on the Adana

hotel (Divan Hotel) project.

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Investment Strategy

• TSKB REIT's investment strategy is concentrated on commercial real estate due to the regular rent income and

cash flow pattern which can be obtained from these kinds of assets.

• Business and shopping centers, tourism facilities, logistic warehouses and industrial plants are typical

investment projects that the Company would like to add to its real estate portfolio.

• Residential investments can be another area of attraction as a part of a mixed use project or with respect to their

potential profitability in stand-alone cases.

Industrial and Geographical Focus The Goal of Growth by Project Development

• TSKB REIT adheres to an investment strategy which seeks to take a project from its initial conception and to

develop it, to organize all project-essential activities in the developmental process, and to complete the project in such a way as to ensure its viability.

• By holding onto the investments which are added to its property portfolio on a long-term basis, the Company’s

aim is not only to achieve sustainable growth but also to take advantage of the likely appreciation in the properties’ value in the long run.

Risk Calculation

• TSKB REIT engages in a painstaking planning process in order to minimize risk factors as much as possible by

verifying a project’s commercial viability before starting it, making sure that the financial resources required by the project will be available, and ensuring that the project is in compliance with existing laws and regulations.

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Section I

The Company

Section III

Financial Data

Section II

Real Estate Portfolio

Section IV

TSGYO Stock Performance

Section V

Appendix

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Breakdown of Real Estate Portfolio* Breakdown of Total Portfolio

*Proportion of Total Portfolio Value.

Portfolio Breakdown

Marketable Securities 5% Real Estate 95%

As of 31.12.2011 ( TL )

Project 15.600.000 Adana Hotel Project 15.600.000 Office Buildings 90.390.000 Fındıklı Buildings 83.030.000 Tahirhan Building 7.360.000 Shopping Center 203.845.000 Pendorya Shopping Center 203.845.000 Total Real Estate Value 309.835.000 Participations

• Marketable Securities

15.153.604 Total Portfolio Value 324.988.604

Office Buildings 29% Project 5% Pendorya Shopping Center 66%

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Value

(TL 000)*



Pendorya Shopping Center



Fındıklı Office Buildings



Tahirhan Office Building

Total

203,845 83,030 7,360

309,835

* Valuations carried out by independent real estate appraisal companies 

Adana Hotel Project 15,600

Real Estate Portfolio Summary

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Pendorya Shopping Center

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Location Pendik - Istanbul TSKB REIT Stake 95% Operational Date December 2009 Land Area (sqm) 23,100 Construction Area (sqm) 80,648 Leasable Area (sqm) 30,250 Occupancy (sqm) (December 2011) 93% Number of Stores 100 Anchor Tenants Tesco Kipa (8,400 sqm), MediaMarkt (5,500 sqm), AFM (2,500 sqm) Appraisal Value (TLm) 203.85

• 95% of Pendorya is held by TSKB REIT and 5% by the

development consultant, the Ataman Group.

• The center features a 1,000-person capacity food court and 1,000

vehicle parking lot. Annual expected footfall is 6 million.

• Center management expect a 96% occupancy rate to be achieved

by end-2012.

Hypermarket 27% Electronics 18% Stores 37% Food 8% Cinema 8% Other 2%

Main Tenants

Pendorya Shopping Center (contd.)

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Pendorya Shopping Center (contd.)

• The Pendorya site was selected after careful evaluation of the surrounding region to ensure

appropriate demographics and growth dynamics as well as unsaturated market conditions and potential.

• Pendorya is located at the crossroads of two of Istanbul’s main highways, and is 8 km distant from

the Sabiha Gokcen (SG) International Airport.

• The Pendik area on the Asian side of Istanbul has a rapidly growing catchment population of

Grade B income consumers. Ongoing boutique residential projects, a marina and other nearby tourism investments increase the attraction of Pendorya’s location.

• The construction of a 3,000-person Garanti Bank Operations Center in the neighbouring plot has
• started. Also located in the vicinity, Turkey’s largest state teaching and research hospital (540

beds) was opened at January 2011.

Pendik State Teaching and Research Hospital Turkey’s 3rd-largest marina First international fair facility on Asian side

Recent Developments in Pendik Region Pendik Development Pipeline

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Fındıklı Buildings

Fındıklı Office Buildings

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Location Istanbul TSKB REIT Stake 100% Land Area (sqm) 1,696 Leasable Area (sqm) 7,102 Number of Floors 7 Tenant TSKB Appraisal Value (TLm) 41.87

• TSKB REIT is the 100% owner of the building.
• The building of some 7,102 sqm of covered space was

purchased from TSKB in 2007.

• Currently, it is rented by TSKB and serves as the headquarters
• f the bank.
• The building was renovated in September 2007, and no major

maintenance outlays are expected in the near future.

• Close proximity to Bosphorus foreshore and mass transit
• ptions also have positive effect on site’s exclusivity. Galata

Port operations will likely increase the site’s future appraisal value.

Fındıklı Office Buildings (contd.)

Fındıklı Building I

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Location Istanbul TSKB REIT Stake 100% Land Area (sqm) 2,503 Leasable Area (sqm) 10,542 Number of Floors 10 Tenants TSKB, TSKB Foundation, TSKB RE Appraisal Appraisal Value (TLm) 41.16

• TSKB REIT is the 100% owner of the property.
• The building has 10,542 sqm of enclosed area and was

purchased from TSKB in 2007.

• Currently rented by TSKB and other TSKB Group companies.
• The building was renovated in September 2007, and no major

maintenance outlays are expected in the near future.

• Close proximity to Bosphorus foreshore and mass transit
• ptions also have positive effect on site’s exclusivity. Galata

Port operations will likely increase the site’s future appraisal value.

Fındıklı Building II

Fındıklı Office Buildings (contd.)

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Tahir Han Office Building

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Location Istanbul TSKB REIT Stake 74% Land Area (sqm) 606 Leasable Area (sqm) 3.200 Number of Floors 8 Tenants Various Appraisal Value (TLm) 7.36

• TSKB REIT owns 74% of the building. Tahirhan is a seven-

story building on 600 sqm plot and has a built up area of 3,200 sqm.

• Building has full sea views from the third story and up.
• Tahir Han is located on the border of a major

redevelopment project. It is suitable for conversion to more lucrative activities. The appraisal value of this site could appreciate considerably.

• At present, the offices are rented out to various companies

and individuals.

Tahir Han Office Building (contd.)

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Adana Hotel Project (Divan Hotel)

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Location Adana-City Center TSKB REIT Stake 50% Acquisition Date November 2007 Appraisal Value – Land (TLm) 15.6 Land Area (sqm) 3,608 Planned Project City Hotel Construction Start Date 3Q2011 Planned Construction Completion Date 1Q2013 Estimated Operational Date 1H 2013 Planned Investment (EURm) 30-34

• TSKB REIT acquired a 50% share of a 3,608 sqm plot

located in a central area of Adana.

• Adana is one of Turkey’s main industrial cities, with

additional business growth potential due to investments in the energy and petrochemical sectors.

• A city hotel project of 200 rooms is under development. The

hotel is to be operational in the first half of 2013.

• Total investment including the cost of the land is estimated

at EUR30m-34m.

Adana Hotel Project (contd.)

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Project fills need for a comfortable city hotel...

• Despite significant commercial and industrial progress in the past

few years, no new high standard hotel has opened in Adana, while the occupancy rate of the existing 5-star hotels has increased remarkably.

• Adana also lacks alternative places for social activities such as

conferences, wedding ceremonies, social occasions and MICE (Meetings, Incentives, Conferencing, Exhibitions) tourism.

• The land for the city hotel was acquired in 2007 with the intent to
• pen a city hotel in accordance with local demand. The land is

located in Seyhan, a central district of Adana.

• The project is located some 2.5 km from the airport and 5.5 km

from the bus terminal.

• An architectural project was prepared for the site, which is already

zoned.

• Operating Agreement (15-year maturity) was signed between

TSKB REIT and Palmira Turizm (Divan Group)

• Construction Licence has been acquired and construction works

has been started.

Adana Hotel Project (contd.)

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Section I

The Company

Section III

Financial Data

Section II

Real Estate Portfolio

Section IV

TSGYO Stock Performance

Section V

Appendix

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Current Assets 8,083 7,602 34,083 7,688 35,242 20,178

Cash and Banks 2,084 3,666 23,845 3,745 30,218 15,154 Financial Investments 5,979 3,417 489 841 1,450 1,888 Other Current Assets 20 519 9,749 3,102 3,573 3,136

Non-Current Assets 3,655 114,584 152,327 290,663 301,937 320,386

Investment Property 3651 69,245 75,580 278,976 290,261 309,835 Fixed Assets 4 45,339 76,729 25 39 85 Other Non-Current Assets

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11,662 11,637 10,466

Total Assets 11,738 122,186 186,410 298,351 337,179 340,564 Short-term Liabilities 41 12,319 7,113 20,431 22,977 11,636

Bank Debts

• 1,343

2,062 12,163 20,170 10,734 Trade Payables

• 8,769

156 4,397 988 573 Other 41 2,207 4,895 3,871 1,819 329

Long-term Liabilities

• 29,143

70,510 113,788 93,268 110,832

Bank Debts

• 29,139

70,509 113,700 93,161 110,685 Other

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1 88 107 147

Shareholders’ Equity 11,697 80,724 108,787 164,133 220,934 218,096

Paid-in Capital 10,000 75,000 100,000 100,000 150,000 150,000 Share Premium

• 593

593 Reserves

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43 153 153 153 Retained Earnings

• 1,666

5,681 8,634 63,980 70,188 Net Income (Loss) 1,697 4,026 3,063 55,346 6,208 (2,838)

Total Liabilities and Shareholders Equity 11,738 122,186 186,410 298,351 337,179 340,564

Balance Sheet

(TL 000)

2006 2007 2008 2009 2010 2011

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Revenues 25 66 6,048 4,723 14,381 14,734 Operating Costs (-) (375) (1,146) (3,149) (3,343) (12,230) (8,270) Net Operating Profit (350) (1,080) 2,899 1,380 2,151 6,464 Income from Other Operations 1,060 786 6,253 52,632 5,444 15,279 Expenses from Other Operations (-) (13 ) (177) (114) (41) (249) (70) Operating Profit 658 (471) 9,038 53,971 7,346 21,673 Financial Income 1,039 4,498 803 1,676 5,650 1,639 Financial Expenses (-)

• (6,778)

(301) (6,787) (26,150) Profit Before Tax 1,697 4,026 3,063 55,346 6,208 (2,838) Tax

• Net Income

1,697 4,026 3,063 55,346 6,208 (2,838)

Income Statement

(TL 000) 2006 2007 2008 2009 2010 2011

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Total Assets Real Estate Portfolio Assets

Key Parameters

Shareholders’ Equity

2006 2007 2008 2009 2010 2011 12 81 109 164 221 218

TL m

2006 2007 2008 2009 2010 2011 4 115 152 279 290 310

TL m

2006 2007 2008 2009 2010 2011 12 122 186 298 337 341

TL m

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Section I

The Company

Section III

Financial Data

Section II

Real Estate Portfolio

Section IV

TSGYO Stock Performance

Section V

Appendix

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TSGYO Stock Performance

Performance Performance 31.12.10 31.12.11 10.02.12 31.12.10-31.12.11 31.12.11-10.02.11 ISE 100 Index 66.004 51.267 59.332

• 22,3%

15,7% ISE REIT Index 36.063 29.849 33.757

• 17,2%

13,1% TSGYO 0,94 0,60 0,64

• 36,2%

6,7% Performance Performance 31.12.10 31.12.11 10.02.12 31.12.10-31.12.11 31.12.11-10.02.12 TSGYO Market Cap (TL mn) 141 90 96

• 36,2%

6,7% TSGYO Market Cap (USD mn) 91 48 55

• 47,8%

15,5%

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TSGYO Stock Performance

TSGYO, ISE REIT Index and ISE 100 Index Performance

0,50 0,60 0,70 0,80 0,90 1,00 1,10 1,20 1,30 1,40

TSGYO ISE REIT Index

ISE-100 Index

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TSGYO Stock Performance

TSGYO - Relative Performance to ISE REIT Index

55 60 65 70 75 80 85 90 95 100 105 110

TSGYO ISE REIT Index

• 36,9%

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Net Asset Value

* as of December 31, 2011 ** as of February 10, 2011

TSGYO Net Asset Value (NAV) ( TL ) Land 15.600.000 Adana Land 15.600.000 Office Buildings 90.390.000 Fındıklı Buildings 83.030.000 Tahirhan Building 7.360.000 Shopping Center 203.845.000 Pendorya Shopping Center 203.845.000 Total Real Estate Value 309.835.000 Participations

• Marketable Securities

15.153.604 Total Portfolio Value 324.988.604 Cash and Banks

• Receivables

1.888.295 Other Assets 13.687.365 Payables 122.468.063 NAV* 218.096.201 Market Cap** 96.000.000 Discount to NAV 56%

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Section I

The Company

Section III

Financial Data

Section II

Real Estate Portfolio

Section IV

TSGYO Stock Performance

Section V

Appendix

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Regulation Highlights

 Capital markets institution, under the supervision of the CMB  Corporate tax exemption  Allowed to invest in real estate, real estate projects, rights and capital market instruments backed by real estate, and money and capital market instruments  >50% of the the portfolio to be invested in real estate  Not allowed to carry out construction  Properties to be valued by independent and CMB licensed appraisal companies  Obligation to go public in 3 months after the establishment of the company  1/3 of the board of directors must be “independent”

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Public REITS

1. Akfen 2. Akmerkez 3. Alarko 4. Atakule 5. Avrasya 6. Doğuş 7. EGS 8. Emlak 9. İdealist 10. İş 11. Kiler 12. Martı 13. Nurol 14. Özderici 15. Pera 16. Reysaş 17. Saf 18. Sinpaş 19. Torunlar 20. TSKB 21. Vakıf 22. Yeşil 23. Yapı Kredi Koray

Non-public REITs

1. Albayrak 2. Bayraktar 3. Büyükhanlı 4. Halk 5. Kuyaş 6. Özak 7. Tuna 8. Servet

REITs in Turkey

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Disclaimer

This presentation does contain forward-looking statements that reflect the Company management’s current views with respect to certain future events based on the base-case assumptions. Although it is believed that the expectations reflected in these statements are reasonable, they may be affected by a variety of variables and changes in underlying assumptions that could cause actual results to differ materially. Neither TSKB REIT nor any of its directors, managers or employees nor any other person shall have any liability whatsoever for any loss arising from the use of this presentation.

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