ABACUS GROUP — AGM Information 2016

Nov 13, 2016

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Artist’s impression of Ashfield Mall residential development, Sydney NSW
Abacus Property Group - 2016 Annual General Meeting
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2016 Annual General Meeting

Abacus Property Group - 2016 Annual General Meeting

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2016 financial summary

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14 Martin Place, Sydney NSW
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Statutory profit Underlying profit $186 million $124 million Up 39% Down 3% Underlying earnings Recurring earnings 22.4 cps 18.0 cps Total securityholder Return on equity return 12 months to 30/6/16 12 months to 30/6/16 13.7% 13.7%

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710 Collins Street, Melbourne VIC
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World Trade Centre, Melbourne VIC
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Net tangible asset $2.66 per security Up 6.8%

Distributions 17.0 cps EPS compound annual growth rate since FY13 6.0% p.a.

Abacus Property Group - 2016 Annual General Meeting

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Strength and opportunity

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Acacia Ridge, Brisbane QLD
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1A Residential project, Erskineville NSW
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51 Allara Street, Canberra ACT
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Abacus has a strong balance sheet

Balance sheet remains conservative and gearing remains low at 25.8%

 Below targeted limits of up to 35%

Interest cover ratio of 4.2x

We maintain high levels of liquidity so we can take positions in assets when opportunities present themselves

This combined with our Third Party Capital partnerships provides flexibility to take advantage of market opportunities

Abacus Property Group - 2016 Annual General Meeting

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Reaffirmation of investment strategy

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SPICE apartments, Brisbane QLD
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Oasis Shopping Centre, Broadbeach QLD
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201 Pacific Highway, Sydney NSW
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We are a long term investor in real estate assets

We look for mispriced assets that represent fundamental value

We add value through active management

We see value in a diversified business that is invested across targeted sectors

• Commercial real estate: Office, Retail, Industrial

• Self –storage facilities

• Residential development projects

• A diversified platform provides resilience to earnings and cashflow

• Ability to re-weight as markets transition through the cycle

Our core plus strategy is integral across all our investment decisions within the sectors we operate

Abacus Property Group - 2016 Annual General Meeting

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Shifting to more recurring style earnings

Capital has been deployed to provide an appropriate rate of return throughout the cycle

Targeted transition of balance sheet allocation over the next 2 to 4 years

Transition to be funded from realisations across our funds management and residential project platforms as they complete

Anticipate circa $125 million of capital realisations from residential projects in FY17

Our capital allocation strategy is designed to grow recurring earnings which will support growth in distributions

• This will provide more predictability in our earnings mix

Balance sheet allocation

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$2.7bn
~10%
$2.2bn
Property Ventures $500
22% ~40%
Funds Management $150
7%
Self - Storage $574
26%
~50%
Property $1,000
45%
NOW 2-4 years
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Abacus Property Group - 2016 Annual General Meeting

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Upgrade to FY17 DPS and distribution strategy

We focus on delivering a stable distribution supported by recurring earnings which securityholders can rely on

Improving levels of recurring earnings over recent years, and our targeted asset allocation strategy, places the Group in a strong position to deliver increasing distributions to securityholders

Abacus is targeting distributions of 17.5 cents per security in FY17 barring unforeseen circumstances

Growth in distributions will be underpinned by contracted and organic growth from an increasing investment in self storage facilities and investment properties

 Increase of 2.9% on FY16

Going forward, Abacus will seek to target an annual distribution growth of between 2-3%pa

Abacus Property Group - 2016 Annual General Meeting

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Its all about the Property Building long term returns - Office

484 St Kilda Road, Melbourne VIC

• Acquired for $68 million in joint venture with Heitman LLC

• Outstanding core plus opportunity within the office sector at that time in the market

• High quality building - one of the best office assets in its precinct

• Asset level equity IRR of 25%

710 Collins Street, Melbourne VIC

• Acquired in late 2014 for $76.5 million

• Iconic, boutique office building located in Melbourne’s docklands

• Strong security to income with high quality tenants and long WALE

• Future development opportunities via an extension of the buildings office tower and a potential re-development of the goods shed into a retail venue

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484 St Kilda Road, Melbourne VIC
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710 Collins Street, Melbourne VIC
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Its all about the Property Building long term returns – Self-storage

Rouse Hill facility, Sydney NSW

• 2.1ha site with c.6.,827m[2] industrial/commercial GFA acquired for $8.5 million ($1,200psm)

• Split into two tenancy areas providing opportunity to immediately convert one tenancy to self-storage while retaining income on remaining tenancy

• Conversion will deliver over 3,000m[2] upon completion

• Facility is trading strongly with occupancy at 90%+ providing support for rental rates at current portfolio averages

Oakleigh South property, Melbourne VIC

• 6,782m[2 ] site with 3,576m[2] warehouse acquired for $3.5 million ($965psm)

• Good clearance in warehouse allows fit out of new mezzanine floor plus surplus land to be used for external/drop down units

• Provides NLA c4,500m[2] plus front office tenancy 500m[2] on Clarinda Road

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Oakleigh South facility pre conversion, Melbourne VIC
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Its all about the Property Building long term returns - Retail

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Birkenhead Point Shopping Centre and Marina, Sydney NSW
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Birkenhead Point Shopping Centre and Marina, Sydney NSW

• Acquired in 2010 for $174 million in joint venture with the Kirsh Group

• Partially refurbished, it presented strong redevelopment potential

• Abacus developed asset into Australia’s premium outlet centre combined with quality convenience based shopping offer to satisfy a strong and growing trade area

• Asset level equity IRR of 24%

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Lutwyche City Shopping Centre, Brisbane QLD
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Lutwyche City Shopping Centre, Brisbane QLD

• Acquired in mid 2015 for $65.0 million or $3,440psm in joint venture

• Large format four-level enclosed neighbourhood shopping centre

• Dominant convenience centre servicing local residents

• Strong repositioning opportunities - currently undergoing refurbishment and redevelopment projects in line to dominate its primary trade area for the convenience shopper

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Its all about the Property Building long term returns - Industrial

Browns Road, Clayton Melbourne VIC

Virginia Park, East Bentleigh, Melbourne VIC

• Acquired for $19.6 million in May 2013

• 10 year, triple net, sale and lease back to PMP Limited

• Strong income and cashflow asset while the site, in established residential location, suggested a residential rezoning may be highest and best use

• Anticipated asset level equity IRR of 35%

• Acquired 50% interest in 2006 for $37.5 million in joint venture

• 12.3ha office/industrial park with 58,500m[2] of NLA in Melbourne’s south east

• Acquired the adjacent GAT site in 2011 taking the site to over 16 ha

• A new Master Plan proposal has commenced to rezone site to accommodate existing office and develop a retail shopping centre, residential accommodation, a new secondary school and age care

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Browns Road, Clayton Melbourne VIC
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Virginia Park, East Bentleigh, Melbourne VIC
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Abacus Property Group - 2016 Annual General Meeting 10

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Its all about the Property Building long term returns – Third Party Capital

Since partnering with sophisticated third party capital investors we have transacted over $1.6 billion of acquisitions

We have become a capital partner of choice with major global groups

We have recently partnered with GAW Capital to invest in opportunistic logistics assets

Acquired two assets in FY17 for $65 million

 Altona, VIC for $30 million

• Chullora, NSW for $35 million

We also recently joint ventured with Investec to acquire 324 Queens Street, Brisbane for $132 million

		Capital partnering since 2010	Sector	Price1, A$
		Birkenhead Point, Drummoyne NSW	Retail	174,000,000
		350 George Street, Sydney NSW	Office/Retail	27,000,000
		4 & 14 Martin Place, Sydney NSW	Office/Retail	153,500,000
		32 Walker Street, North Sydney NSW 484 St Kilda Road, St Kilda VIC 309 George Street, Sydney NSW	Office Office Office/Retail	35,600,000 68,000,000 68,750,000
		180 Queen Street, Brisbane QLD	Office/Retail	29,500,000
		35 Boundary Street, Brisbane QLD	Office	40,250,000
		Wharf 10, Sydney NSW	Office	31,800,000
		World Trade Centre, Melbourne VIC	Office/Retail	120,400,000
		Oasis, Gold Coast QLD 201 Pacific Highway, St Leonards NSW Lutwyche City, Brisbane QLD	Retail Office/Retail Retail	103,500,000 115,000,000 65,000,000
		Merivale, South Brisbane QLD	Residential development	275,000,000
		324 Queens Street, Brisbane QLD	Office	132,000,000
		182–198 Maidstone Street, Altona VIC	Industrial	30,000,000
		2-34 Davidson Street, Chullora NSW	Industrial	35,000,000
		Red Cross Building, Sydney NSW	Office	112,900,000
		Total		1,617,200,000

1. Represents the acquisition price for commercial properties or the total estimated sales revenue from residential developments

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Its all about the Property Building long term returns – Third Party Capital

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Abacus has had a long history of partnering with other investors

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Many relationships have been forged over more than two decades and have lasted the distance

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These relationships provide outstanding opportunities for deal origination which matched with our management platform provides strong returns for our securityholders

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2-34 Davidson Street, Chullora NSW
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Its all about the Property Operational updates - Residential

• Campsie: Site one sold in September 2016 for $49.5 million - c. $140,000 a unit

Site two: Approved for 83 units with a further 19 units possible due for exchange under same pricing in late Nov16 Settlements in early 2017 will repay Abacus’ $42.1million loan and Abacus is entitled to a 50% share of any profits

Werrington: Stages 1/2: 138 land lots settled repaying $13m Abacus loan Stage 3 gazetted for 111 blocks – awaiting DA approval Stage 4 awaiting gazettal for 121 land lots

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Artist’s impression of 548-568 Canterbury Rd, Campsie NSW
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• The Prince: 146 residential unit development in Canberra Settlements began in October 2016 with 124 settled to date 1 unit handed back with 3 units remaining for sale

• $3m capital investment repaid with profit share to come

Spice: 274 residential unit development in South Brisbane Settlements began in October 2016 with 240 settled to date 12 units handed back with 4 units remaining for sale

• $32.1m capital investment repaid with profit share to come

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SPICE, Brisbane QLD
French Road, Werrington NSW
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Abacus Property Group - 2016 Annual General Meeting

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Its all about the Property Operational updates - Residential

Riverland, Milperra NSW

• Received NSW state government gazettal for the residential rezoning of stage one of its residential land sub-division in October 2016

• The gazettal approved the rezoning of the first stage of the residential development covering 15ha to R2 Low Density Residential

• A development application will sub-divide the land into a mix of large and small lots with a view to maximising revenue will now be progressed with council

Camellia, Parramatta NSW

• We are finalising traffic studies at the request of Council

• Studies to be submitted to the RMS and Transport for NSW for their approval

• Once approved, Parramatta Council will, if they are satisfied with the advice from the above departments, make the recommendation for the adoption of the Planning Proposal (PP) to the NSW Department of Planning and Environment and then the PP is gazetted

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The Prince, Canberra ACT
Aerial view of new Riverlands perspective, Milperra NSW
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Artist impression of possible residential development Camellia, NSW
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Strong securityholder value proposition

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Artist Impression of residential development
Hawthorn VIC
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Bacchus Marsh Village Shopping Centre, Bacchus
Marsh VIC
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Lutwyche City Shopping Centre, Brisbane QLD
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Residential projects are held at the lower of cost or net realisable value

The carrying value of residential projects are reviewed and impairment tested at each reporting date

Current cost base and transactional evidence suggests strong intrinsic value

Security pricing suggests residential business valued close to cost

$574 million prime self storage portfolio held at a weighted average cap rate of 8.0%

Projected FY17 distribution yield of 6.4%

Security price trading close to NTA of $2.66 per security

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Outlook

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Remuera self-storage facility, Auckland NZ
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Westpac House, Adelaide SA
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180 Queen Street, Brisbane QLD
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Property sector remains highly priced while the market is rampant with capital

The need to deploy capital desensitises investment decisions or as Boston Fed President Eric Rosengren warned:

‘one cost of the lower for longer interest rate cycle involves the potential to encourage commercial real estate speculation’

We are long term property investors committed to grow securityholder value over time

The easiest way to ensure long term value accretion is to avoid making mistakes at the point of acquisition

Our ultimate objective has always been to create secure and profitable real estate investments that will sustain and grow over time

We are very disciplined in our investment decision making always seeking fundamental value at the point of entry

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Business of the

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Abacus Property Group - 2016 Annual General Meeting 17

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Resolutions

Resolution 1

To receive and consider the annual financial report, directors’ report and auditor’s report of Abacus Property Group and its controlled entities for the year ended 30 June 2016

Resolution 2

To adopt the Remuneration Report for the year ended 30 June 2016

Resolution 3

That John Thame, who retires in accordance with the Constitutions, be re-elected as a director of Abacus Group Holdings Limited, Abacus Group Projects Limited and Abacus Storage Operations Limited

Resolution 4

That approval be given for the Company to grant 230,260 deferred security acquisition rights (SARs) to the Managing Director, Dr Frank Wolf OAM

Resolution 5

That the issue of 5,641,569 securities on 28 July 2016 be ratified and approved by securityholders

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Proxy results

Resolutions	FOR	OPEN	AGAINST
Adoption of remuneration report	466,356,726	1,155,094	16,338,627
	96.4%	0.2%	3.4%
Re-election of John Thame as a Director	462,140,059	3,358,690	21,088,329
	95.0%	0.7%	4.3%
Approval of SARs to Managing Director Dr	463,990,532	1,152,405	18,789,351
Frank Wolf	95.9%	0.2%	3.9%
Ratification of 5,641,569 placement securities	301,909,613	3,345,695	452,898
issued via institutional placement	98.8%	1.1%	0.1%

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Questions
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Disclaimer

The information provided in this document is general, and may not be suitable for the specific purposes of any user of this document. It is not financial advice or a recommendation to acquire Abacus Property Group securities (ASX: ABP). Abacus Property Group believes that the information in this document is correct (although not complete or comprehensive) and does not make any specific representations regarding its suitability for any purpose. Users of this document should obtain independent professional advice before relying on this document as the basis for making any investment decision and should also refer to Abacus Property Group’s financial statements lodged with the ASX for the period to which this document relates. This document contains non-AIFRS financial information that Abacus Property Group uses to assess performance and distribution levels. That information is calculated in accordance with the AICD/Finsia principles and is not audited.

Any forecasts or other forward looking statements contained in this presentation are based on assumptions concerning future events and market conditions. Actual results may vary from forecasts and any variations may be materially positive or negative.

The information in this document is current only as at the date of this document, and that information may not be updated to reflect subsequent changes.

To the extent permitted by law, the members of Abacus Property Group and those officers responsible for the preparation of this document disclaim all responsibility for damages and loss incurred by users of this document as a result of the content of, or any errors or omissions in, this document.

Abacus Property Group:

Abacus Group Holdings Limited ACN: 080 604 619

Abacus Group Projects Limited ACN: 104 066 104

Abacus Funds Management Limited ACN: 007 415 590 AFSL No. 227819

Abacus Storage Funds Management Limited ACN: 109 324 834 AFSL No. 277357

Abacus Storage Operations Limited ACN: 112 457 075

Abacus Property Group - 2016 Annual General Meeting 21