Kojamo Oyj

Investor Presentation • Nov 5, 2020

5 November 2020 Jani Nieminen, CEO Erik Hjelt, CFO

Interim Report 1 –9/2020

Kojamo plc

• Summary of January– September 2020
• Financial development
• Outlook, financial targets and dividend policy

Summary of January– September 2020

3

Operating environment

General operating environment

• The COVID-19 pandemic has contracted the Finnish economy less than most European economies and the economy has started gradually recover during the summer
• The Finnish GDP is predicted to contract by 4.5 per cent in 2020. In addition to a decrease in exports, there will be a contraction of private consumption and private investment
• The impacts of the pandemic on the housing market are expected to be short-lived and urbanisation is expected to continue

Population forecast 2019

Business environment key figures

Population growth forecast 2019–2030

Kojamo plc's Interim Report January–September 2020

* Helsinki, Espoo, Kauniainen, Vantaa, ** Capital region, Hyvinkää, Järvenpää, Kerava, Kirkkonummi, Mäntsälä, Nurmijärvi, Pornainen, Porvoo, Riihimäki, Sipoo, Tuusula, Vihti Sources: General operating environment, Business environment key figures: Ministry of Finance, Economic Survey 10/2020; Population growth forecast: Statistics Finland,

4

Operating environment

Industry operating environment

• Urbanisation and decreasing average size of households increase the need for new apartments
• The pandemic has increased the slowing down of housing start-ups and the housing production is expected to be below the annual demand for housing in 2020 and 2021
• The supply in the long-term leasing market increased in the first part of the year, when new completed production entered the market and apartments intended for short-term rental were switched to long-term rental. These impacts are expected to be already fully in the market

Industry key figures	2020E	2019
Residential start-ups, units	28,000	38,700
Building permits granted, annual*, units	34,996	39,140
Construction costs, change, %	n/a	1.0
Prices of old dwellings in the whole country, change, %	1.0	1.2
Prices of old dwellings in the capital region, change, %	1.0–3.1	0.5–3.4
Rents of non-subsidised rental dwellings in the whole country, change, %	1.6	1.4
Rents of non-subsidised rental dwellings in the capital region, change, %	1.6–1.8	1.6–2.0

5

* Rolling 12 months, August 2020

Kojamo plc's Interim Report January–September 2020

Sources: Industry operating environment: Ministry of Finance, Economic Survey 10/2020; Industry key figures: PTT, Statistics Finland: Building and dwelling production 2020, May, Confederation of Finnish Construction Industries RT's business survey spring 2020; Housing production need: VTT, Need for housing 2020-2040

Operating environment

Pandemic does not have a long-term impact on the rental market

• In a longer term, migration keeps the demand for rental apartments especially close to good connections high. The significance of location and services is highlighted in housing needs
• People are increasingly attracted by the freedom provided by rental housing, which supports the development of the market for a long time
• In Helsinki, Tampere and Turku there are already more rental households than owner-occupied and the amount has increased in all of the largest city areas. This is a strong sign of acceleration of urbanisation and changes in living preferences as well
• Corona virus pandemic slowed down housing trade and uncertainty increases the popularity for rental apartments

6

* Helsinki, Espoo, Kauniainen, Vantaa, Hyvinkää, Järvenpää, Kerava, Kirkkonummi, Mäntsälä, Nurmijärvi, Pornainen, Porvoo, Riihimäki, Sipoo, Tuusula, Vihti Sources: The popularity of rental housing increases: MDI's population forecast 2040 and Pellervo Economic Research PTT, Housing markets 2020 forecast; Development of household sizes and rental household-dwelling units: Statistics Finland, Dwellings and housing conditions 2019

	Of the portfolio's fair value 98.8% in the seven
largest Finnish growth centres Apartment distribution, %
	Region	Number of apart ments, units	Number of commercial premises and other leased premises, units	Fair value, (EUR million)	Fair value (EUR thousand / unit)	Fair value (EUR / sqm)	Financial occupancy rate, %3)		4.0% 4.7% 5.0% 6.2% 5.3%	2.3%	Helsinki region Tampere region Turku region
	Helsinki region	20,858	315	4,472	211	3,757	96.4		13.9%	58.6%
	Tampere region	4,934	126	622	123	2,384	96.6				Oulu
	Turku region	1,904	17	217	113	1,980	97.7		Fair value	distribution, %
	Oulu	2,220	19	185	83	1,570	97.0				Jyväskylä
	Jyväskylä	1,771	2	185	104	1,986	93.1		2.4% 2.7%	1.2%
	Kuopio region	1,674	47	161	94	1,756	95.0		3.1% 3.1%		Kuopio region
	Lahti region	1,436	4	148	102	1,829	96.2		3.6%
	Others	816	24	71	84	1,487	95.6		10.3%		Lahti region
	Total	35,613	554	6,0611)	168	3,043	96.3				Others
	Others			5372)
	Total portfolio	35,613	554	6,598			96.3			73.8%

Kojamo plc's Interim Report January–September 2020

1) The figures reflect income-generating portfolio assets, which excludes ongoing projects, plots owned by the company and ownership of certain assets through shares 2) Fair value of ongoing projects, plots owned by the company and ownership of certain assets through shares and IFRS 16 right-of-use assets 3) Financial occupancy rate does not include commercial premises and other leased premises

7

The number of apartments under construction has doubled

• During the review period, 18 (482) apartments were sold, 45 (117) acquired and 340 (710) completed
• During the period, construction of 1,556 (855) apartments was started

Even stronger project pipeline

• Over 2,500 apartments Projects under construction under construction, all in the Helsinki region
• Co-operation agreements on the construction of over 1,000 apartments
• Metropolia property development project to bring even 1,000 apartments, as 7 former educational buildings will be converted into residential use

construction'

Lumo builds customer experience in a new way

Services of a new customer Services during tenancy

• Personal open house

• 250 € Affordable security deposit Move and installation service

• Pets are welcome
• Broadband included in rent
• Sustainable interior paints for free
• Key courier service

Our sustainability work is proceeding

• EPRA (European Public Real Estate Association) recognised Kojamo's financial statements for 2019 with a gold award for the second consecutive year and Kojamo's sustainability report for 2019 with a silver award
• Kojamo also received a Most Improved award for developing its sustainability reporting
• We will publish our sustainability programme on 2 December 2020

Total revenue and profit before taxes increased

• Total revenue increased mainly due to growth of property portfolio as well as Like-for-Like rental income growth

* Changes in value = Profit/loss on fair value of investment properties

Net rental income and FFO increased

• The growth was supported by the growth of apartment portfolio, Like-for-Like rental income growth and lower maintenance costs than in the comparison period

Changes in the total number of Kojamo shares have an impact on relative development of FFO per share. Per share key figures have been adjusted to reflect the impact of the decision by the Extraordinary General Meeting of Shareholders on 25 May 2018 regarding the share split. In the share split the shareholders received 30 new shares per each existing share 16

Occupancy rate on a good level despite of COVID-19 pandemic

• COVID-19 pandemic has temporarily had an impact on the increase of supply as well as migration
• The number of new agreements has been increasing

Financial occupancy rate = (Rental income / potential rental income at full occupancy) x 100. Financial occupancy rate does not include apartments under renovation Tenant turnover = (terminated rental agreements under the period / number of apartments) x 100

The calculation method of tenant turnover has been changed, starting from 1 January 2017. The comparison data has not been modified to reflect the new calculation method

Strong progress in investments

• Gross investments exceed the level of the whole year 2019

Gross investments and sales of investment properties, M€

Gross investments Sales of investment properties

696.0 367.3 365.2 259.9 175.6 264.1 -559.0 -82.2 -109.6 -26.0 -24.3 -3.3 2016 2017 2018 2019 1–9/2019 1–9/2020

Modernisation investments and repairs, M€

The value of investments properties was EUR 6.6 billion

• The shift from transaction-based valuation technique to yield-based valuation technique as of 31 December 2019 significantly increased the fair value of the investment properties
• The fair value has developed positively during the review period

Fair value of investment properties, M€ 1)

Number of apartments by valuation classes (at the end of the review period)

1) Investment properties include completed apartments, development projects and land areas as well as Investment properties held for sale

Plot and real estate development reserve 30 Sep 2020

	Apartments under construction	Binding preliminary agreements	Owned plots and developme nt projects1	In total
Investment / actual costs incurred	326.8	-	145.8	472.6
Cost of completion	295.0	233.4	-	528.4
1,000 fl.sq.m.			184
Apartments	2,532	1,062	~3,0002	~6,500

100% of plot and real estate development reserve is located in Helsinki region

Kojamo estimates that investments in development projects amount to approximately EUR 320–350 million in 2020

1) The management's estimate of the fair value, building rights of plots and number of apartments 2) The management's estimate, currently approximately 300 apartments in existing residential buildings

Equity ratio and Loan to Value (LTV)

• Equity ratio and Loan to Value (LTV) strengthened significantly

The share issue improved the equity ratio by 1.6 percentage points

EPRA NAV per share improved

• Key figures per share improved significantly
• According to EPRA's guidelines, we will adopt revised features of the Net Asset Valuation metrics in the 2020 financial statements

1) Key figures have been adjusted to reflect the impact of the decision by the Extraordinary General Meeting of Shareholders on 25 May, 2018 regarding the share split. In the share split the shareholders received 30 new shares per each existing share

Versatile capital structure

1.8

107

23

2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030->

4.6 4.7

Loan amounts presented as IFRS figures. In addition, lease liabilities amounting to EUR 61.9 million are included in interest-bearing liabilities.

Strategic targets 2020–2023

Key figure	Actual 1–9/2020	Strategic target
Annual growth of total revenue, %	2.3	4–5
Annual investments, M€	264.1	200–400
FFO/total revenue, %	39.6	> 36
Loan to Value (LTV), %	42.1	< 50
Equity ratio, %	44.1	> 40
Net Promoter Score (NPS)	36	40

Outlook, financial targets and dividend policy

Outlook for Kojamo in 2020

Kojamo estimates that in 2020, the Group's total revenue will increase by 2–5 per cent year-on-year. In addition, the company estimates that the Group's FFO for 2020 will amount to between EUR 146–158 million, excluding non-recurring costs.

The outlook takes into account the effects of the completed housing divestments and acquisitions, the estimated occupancy rate and rises in rents, as well as the number of apartments to be completed. The outlook is based on the management's assessment of total revenue, net rental income, administrative expenses, financial expenses, taxes to be paid and new development to be completed, as well as the management's view on future developments in the operating environment.

Additionally, the outlook is based on strong demand sustained by migration, which will increase Like-for-Like rental income. The management can influence total revenue and FFO through the company's business operations. In contrast, the management has no influence over market trends, the regulatory environment or the competitive landscape.

Kojamo's management estimates that the COVID-19 pandemic does not have a significant impact on the company's outlook for the rest of the year.

Dividend policy

Kojamo plc's Interim Report January–September 2020

Kojamo's objective is to be a stable dividend payer whose annual dividend payment will be at least 60 per cent of FFO, provided that the Group's equity ratio is 40 per cent or more and taking account of the company's financial position

62% 60% Dividend history

* Including extra dividend EUR 0.29 per share

Per share key figures have been adjusted to reflect the impact of the decision by the Extraordinary General Meeting of Shareholders on 25 May, 2018 regarding the share split. In the share split the shareholders received 30 new shares per each existing share

27

Total revenue, net rental income and FFO increased

Strong progress in property development investments, number of apartments under construction doubled from comparison period

Urbanisation continues and need for new apartments grows. We are in a good position to continue our growth

Thank you!

Contact details:

CEO Jani Nieminen, tel. +358 20 508 3201

CFO Erik Hjelt, tel. +358 20 508 3225

Manager, Investor Relations Maija Hongas, tel. +358 20 508 3004

www.kojamo.fi

Financial Statements Release for 2020 to be published on 18 February 2021

Welcome to join Kojamo's first Investors' Day on Wednesday 2 December 2020.

The event will be held in virtual format.

More information at kojamo.fi/investors-day

Change in the valuation technique of investment properties as at 31 December 2019

Change	Kojamo shifted from a transaction-based valuation technique to a yield-based valuation technique in the valuation of its investment properties
Rationale	The change in the valuation technique will make the company more comparable with its relevant international peer group
External valuation partner	Jones Lang LaSalle Finland Oy (JLL)
Entry into force	The new valuation technique was implemented on 31 December 2019. The change is a change in accounting estimates by nature, and it will not be applied retrospectively
Description of the technique	The new valuation technique is based on 10-year discounted cash flow (DCF) calculations. The discount rate is the 10-year cash flow yield requirement plus inflation. The weighted yield requirements used are the following: • Capital region 3.83% • Other regions of Finland 5.05% • Group total 4.23% JLL has given a statement about Kojamo's valuation, and the fair value of the investment properties under the assessment corresponds this statements

New strategy period 2020–2023

• Our strategy has proved to be strong, and we will continue to implement it going forward
• The Board of Directors has approved updated strategic targets and focal points for 2020–2023
• We seek strong growth with optimised financing structure and profitable business through industry-leading operating models. We have the capacity to pursue growth with a multi-channel approach and quickly react to opportunities. We invest strongly in servitisation and take advantage of solutions enabled by digitalisation

Strategic focal points 2020–2023

Delivering the best customer experience

We offer easy and effortless services for our customers and create added value through services

Strong growth

We seek profitable growth with multichannel approach and optimised financing structure

Operational excellence

We create competitiveness and profitability through industry-leading operating models

Responsibility and sustainable development

Responsibility is a part of our DNA and plays important role in the work of everyone at Kojamo

The most competent personnel and a dynamic place to work

We are known for dynamic and effective corporate culture. We ensure our future competitiveness through competence development and employee experience

Renewal through digital solutions

We improve our business and create added value to our customers by taking advantage of solutions enabled by digitalisation

Our Digital Roadmap will guide us from today to year 2023 according to our strategy

• Kojamo is a frontrunner thanks to the direct rental in its webstore. Now we will focus on direct rental service as the main rental channel
• We will strengthen our position by digitalising the whole customer path combining urban living experience and services
• We will utilise technology and renew operating models in order to implement operative excellence
• Use of data will be central in change supporting leadership, operations and customer work

Customer experience and servitisation

Scalability of operations, employee experience

Digitalisation of properties and services

Knowledge-based management and AI

Enabling technology and IT architecture

Our corporate responsibility is reflected in our mission of creating better urban housing

• Responsibility and sustainable development is one of Kojamo's strategic focal points
• We conducted a materiality analysis of sustainability in spring 2020. The results of the materiality analysis provide the foundation for our sustainability programme, which will be published on 2 December 2020
• We participated in the Global Real Estate Sustainability Benchmark (GRESB) survey for the first time in 2020
• Our sustainability report on the year 2019 marked the first time that we have applied the Global Reporting Initiative (GRI) framework and the EPRA (European Public Real Estate Association) Sustainability Best Practices Recommendations

Strong growth | Operational excellence | Renewal through digital solutions

Sustainability is visible in our every day life

Anti-grey economy models exceed legislative

requirements

Finland's most inspiring places to work recognition for the third consecutive year

90 EUR million tax footprint

4,951 years, indirect employment effect

0 data protection

violations or deviations

75%

Personnel satisfaction index on a high level (control group: 68%)

93.7 TR index on a high level

Kojamo plc's Interim Report January–September 2020 37 All figures represent the situation at the end of 2019 except for nearly zero-energy construction figures that represent the end of period. * = In line with VAETS II programme, at the end of 2019

-7.5%

Our goal to boost energy consumption during 2017–2025, of which we have achieved 73%*

100%

of Kojamo's premises are WWF Green Office certified

Shared cars in use of Lumo tenants

Hydropowercertified property electricity at 100% of properties

2,075 completed,

2,289 under construction, nearly zero-energy apartments

29,000 apartments' indoor temperature controlled by IoT solution (80%)

-1.2% specific water consumption (l/m³ )

-1.4% energy consumption index (kWh/m³ )

-1.2%

total energy consumption in properties (kWh/m³ )

-1.0% waste (kg/ apartment)

Kojamo's ten largest shareholders (as at 30 Sep 2020)

	Shareholder	Number of shares	% of shares
	Nominee-registered and direct foreign shareholders	104,045,568	42.1
1.	The Finnish Industrial Union	24,809,561	10.0
2.	Ilmarinen Mutual Pension Insurance Company	20,537,814	8.3
3.	Varma Mutual Pension Insurance Company	19,362,375	7.8
4.	Trade Union of Education in Finland	15,081,498	6.1
5.	Trade Union for the Public and Welfare Sectors	12,300,000	5.0
6.	Finnish Construction Trade Union	9,866,210	4.0
7.	Trade Union PRO	8,260,270	3.3
8.	Service Union United PAM	7,400,000	3.0
9.	Elo Mutual Pension Insurance Company	2,881,113	1.2
10.	Åbo Akademi University Foundation	2,198,763	0.9
Other	Finnish shareholders	20,401,227	8.3
Total		247,144,399	100.0

Development of the number of the shareholders

Number of shareholders

Share of nominee-registered and direct foreign ownership, %

Source: Euroclear Finland

	7–9/2020	7–9/2019	Change, %	1–9/2020	1–9/2019	Change, %	2019
Total revenue, M€	96.3	95.7	0.6	286.8	280.3	2.3	375.3
Net rental income, M€	68.9	69.5	-1.0	193.8	187.2	3.5	247.3
Net rental income margin, %	71.5	72.6		67.6	66.8		65.9
Profit before taxes, M€	72.8	66.6	9.4	198.0	191.4	3.5	1,031.3
Gross investments, M€	85.1	79.0	7.7	264.1	175.6	50.4	259.9
Funds From Operations (FFO), M€	42.0	39.7	5.9	113.5	106.1	7.0	140.7
FFO per share, €	0.17	0.16	6.3	0.46	0.43	7.0	0.57
Financial occupancy rate, %				96.3	97.1		97.2
Fair value of investment properties, Bn€				6.6	5.4	22.7	6.3
Number of apartments				35,613	35,061	1.6	35,272
Rental apartments under construction				2,532	1,211	109.1	1,316
EPRA NAV per share, €				15.90	12.11	31.3	15.49
Equity ratio, %				44.1	42.0		46.9
Loan to Value (LTV), %				42.1	46.7		40.5

Consolidated income statement

M€	7–9/2020	7–9/2019	1–9/2020	1–9/2019	1–12/2019
Total revenue	96.3	95.7	286.8	280.3	375.3
Maintenance expenses	-17.9	-17.3	-68.1	-69.0	-91.1
Repair expenses	-9.6	-8.9	-24.9	-24.1	-36.9
Net rental income	68.9	69.5	193.8	187.2	247.3
Administrative expenses	-8.8	-8.6	-29.0	-28.3	-38.7
Other operating income and expenses	1.4	0.5	2.7	1.4	1.7
Profit/loss on sales of investment properties	0.0	0.3	-0.7	0.2	0.1
Profit/loss on sales of trading properties	-	-	-	0.1	0.2
Profit/loss on fair value of investment properties	25.8	18.4	74.1	71.0	872.4
Depreciation, amortisation and impairment losses	-0.7	-0.3	-1.2	-0.9	-1.1
Operating profit	86.5	79.9	239.6	230.7	1,081.9
Total amount of financial income and expenses	-13.7	-13.3	-41.6	-39.3	-50.8
Share of result from associated companies	-	-	0.0	0.0	0.2
Profit before taxes	72.8	66.6	198.0	191.4	1,031.3
Current tax expense	-4.8	-9.2	-13.5	-17.2	-19.9
Change in deferred taxes	-9.6	-4.2	-26.1	-21.1	-186.2
Profit for the period	58.4	53.2	158.5	153.1	825.2

Balance sheet

M€	30 Sep 2020	30 Sep 2019	31 Dec 2019
ASSETS
Non -current assets
Intangible assets	0.1	0.2	0.2
Investment properties	6,595.4	5,376.4	6,260.8
Property, plant and equipment	29.6	31.0	30.9
Investments in associated companies	1.6	2.2	2.4
Financial assets	0.7	0.6	0.7
Non -current receivables	7.9	4.9	3.2
Derivatives	0.1	0.3	0.2
Deferred tax assets	17.2	20.1	14.4
Total non -current assets	6,652.5	5,435.8	6,312.8
Non -current assets held for sale	2.4	-	-
Current assets
Trading properties	0.1	0.3	0.1
Derivatives	0.5	0.4	0.3
Current tax assets	2.5	0.1	0.1
Trade and other receivables	10.7	8.7	7.7
Financial assets	127.9	152.0	132.1
Cash and cash equivalents	358.4	130.0	137.3
Total currents assets	500.2	291.4	277.6
TOTAL ASSETS	7,155.1	5,727.2	6,590.4

Balance sheet

M€	30 Sep 2020	30 Sep 2019	31 Dec 2019
EQUITY AND LIABILITIES
Equity attributable to shareholders of the parent company
Share capital	58.0	58.0	58.0
Share issue premium	35.8	35.8	35.8
Fair value reserve	-55.1	-61.1	-44.7
Invested non -restricted equity reserve	164.4	164.4	164.4
Retained earnings	2,950.9	2,204.7	2,877.0
Equity attributable to shareholders of the parent company	3,154.1	2,401.8	3,090.6
Total equity	3,154.1	2,401.8	3,090.6
Non -current liabilities
Loans and borrowings	2,889.0	2,424.8	2,429.3
Deferred tax liabilities	710.0	520.2	683.8
Derivatives	82.5	92.3	69.8
Provisions	0.4	0.5	0.5
Other non -current liabilities	4.7	13.9	5.1
Total non -current liabilities	3,686.6	3,051.7	3,188.4
Current liabilities
Loans and borrowings	248.6	215.9	244.9
Derivatives	0.7	0.1	0.2
Current tax liabilities	2.3	3.4	2.0
Trade and other payables	62.8	54.3	64.3
Total current liabilities	314.4	273.7	311.4
Total liabilities	4,001.0	3,325.4	3,499.8
TOTAL EQUITY AND LIABILITIES	7,155.1	5,727.2	6,590.4

Financial key figures

	30 Sep 2020	30 Jun 2020	31 Mar 2020	31 Dec 2019	30 Sep 2019
Equity ratio, %	44.1	43.3	45.3	46.9	42.0
Interest cover	4.2	4.3	4.3	4.3	4.4
Loan to Value (LTV), %	42.1	42.6	39.5	40.5	46.7
Hedging ratio, %	89	87	85	88	90
Average interest rate, %1)	1.8	1.7	1.8	1.8	1.8
Average loan maturity, years	4.6	4.8	4.4	4.7	4.9
Average interest rate fixing period, years	4.7	4.8	4.6	4.9	5.2

1) Includes interest rate derivates

Development of housing production

Completed apartments, units

Quarterly development in Helsinki, units

Kojamo plc's Interim Report January–September 2020 44 Source: Annual data for Helsinki region: Helsinki Region Environmental Services Authority HSY, Follow-up of the Helsinki Region's Agreement on Land-use, Housing and Transport (MAL); Finland total: Statistics Finland; Helsinki: Living in Helsinki, construction review quarterly. Estimates for 2020 have been made before the corona pandemic except for estimate for start-ups in Finland in total.

Important information

This presentation shall not constitute an offer to sell or the solicitation of an offer to buy securitites in any jurisdiction. No part of this presentation, nor the fact of its distribution, should form the basis of, or be relied on in connection with, any contract or commitment or investment decision.

This presentation includes forward-looking statements, which include statements regarding the Kojamo's business strategy, operating and financial targets, financial condition, profitability, results of operations and market data, as well as other statements that are not historical facts. Words such as "believe," "anticipate," "plan," "expect," "target," "estimate," "project," "predict," "forecast," "guideline," "should," "aim," "continue," "could," "guidance," "may," "potential," "will," as well as similar expressions and the negative of such expressions are intended to identify forward-looking statements, but are not the exclusive means of identifying these statements. By their nature, forwardlooking statements are subject to numerous factors, risks and uncertainties that could cause actual outcomes and results to be materially different from those projected. Undue reliance should not be placed on these forward-looking statements. Except for any ongoing disclosure obligation as required by applicable law, Kojamo does not have any intention or obligation to publicly update or revise any forward-looking statements, whether to reflect any future events or circumstances or otherwise.