ARENA REIT. — Annual Report 2021

Aug 10, 2021

ARENA REIT

2021 FULL YEAR RESULTS 11 August 2021

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AGENDA

FY21 Highlights 3 Delivering on Strategy 4 COVID-19 Update 5 Sustainability 6 Financial Results 7 Portfolio Update 12 Outlook 20 Questions 21 Corporate Directory 22 Appendices 23 Important Notice 33

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2 A R E N A R E I T 2 0 2 1 F U L L Y E A R R E S U L T S

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FY21 HIGHLIGHTS

Continuing strong portfolio, investment and community outcomes

$165.4 million $51.9 million

Statutory net profit +116% on FY20

Net operating profit

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+18.5% on FY20
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• 18.5% growth in net operating profit driven by contracted rental growth, acquisitions and development completions and lower finance costs.

• 15% growth in NAV highlights essential nature of early learning (ELC) and healthcare properties.

• $106 million of capital deployed in FY21:

• $40 million acquisition of seven operating ELC properties; and

• Continued delivery of development completions and expanded development pipeline.

• Divestment of six ELC properties at 16% premium to book value.

15.2 cents

14.8 cents

Earnings per security[4] Distributions per (EPS) security (DPS)

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+4.5% on FY20
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+6% on FY20
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• Existing long WALE further increased to 20.1[1] years.

• .

• Gearing ratio of 19.9%[2]

• FY22 DPS guidance of 15.8 cents per security, an increase of 6.8%[3 ] on FY21.

• Post balance date portfolio lease renegotiation with Goodstart included an increase of 25 years of term on 87 ELC properties.

• Gearing calculated as ratio of net borrowings over total assets less cash.

• Guidance is estimated on a status quo basis assuming no new acquisitions or disposals, all developments in progress are completed in line with forecast assumptions, tenants comply with their existing or adjusted lease obligations and is based on Arena’s current assessment of the future impact of COVID-19 pandemic (which is subject to a wide range of uncertainties) and assumes ongoing government support of the early learning sector.

• EPS is calculated as net operating profit over weighted average number of securities on issue.

$2.56

$2.56 20.1 years[1 ] Weighted Average Net Asset Value Lease Expiry (WALE) (NAV) per security

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+15% on FY20
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+6.1 years on FY20
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3 A R E N A R E I T 2 0 2 1 F U L L Y E A R R E S U L T S

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• DELIVERING ON STRATEGY

• Strategy discipline and working in partnership continue to deliver positive outcomes

Working in partnership:

Portfolio management:

• Portfolio weighted average lease expiry (by income) increased to 20.1[1,2] years.

• Six ELC properties sold at average premium of 16% to book value.

• Net valuation uplift of $107.6 million.

• • Portfolio weighted average passing yield 5.77%.

Lease management:

• Post balance date portfolio lease renegotiation with Goodstart on 87 .

• ELC properties across Australia[2]

• 100% portfolio occupancy.

• • Average FY21 like-for-like rent increase of +3.3%[3] .

• Pro-forma WALE as at 30 June 2021.

• Arena REIT (ASX: ARF) ASX Announcement Market Update 29 July 2021.

• Continue to rollout the installation of renewable energy systems.

• • Completed rejuvenation of six ELCs in partnership with two tenant groups.

• • All tenant partners remain compliant with .

• COVID-19 rent relief agreements[4]

Investment and developments:

• Seven operating properties acquired at an average net initial yield of 6.1% on total cost with initial weighted average lease expiry of 27.3 years.

• 14 ELC developments completed at an average net initial yield on total cost of 6.6% with initial weighted average lease expiry of 20.8 years.

• Nine new ELC development projects acquired with forecast total cost of $54 million[5] .

1. Includes 25 market rent reviews from FY20 which were all resolved at an average increase of +6.5%.

2. Under the National Cabinet Mandatory Code of Conduct landlords are obliged to provide eligible tenants rental relief in proportion to the reduction in trade resulting from COVID-19.

3. Excludes two ELC projects that were conditionally contracted prior to, and one ELC project that was unconditionally contracted post, 30 June 2021.

4 A R E N A R E I T 2 0 2 1 F U L L Y E A R R E S U L T S

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COVID-19 UPDATE

Arena’s portfolio accommodates essential services

• All of Arena’s properties currently remain open and in operation.

• 100% of contracted rent has been receipted for the period 1 July 2020 to 30 June 2021.

• Origination and development programs largely unaffected.

• Medical centre properties assisting in national COVID-19 vaccination program and precedent for strong recovery in elective procedures following easing of any COVID-19 related restrictions.

• The essential nature of the services provided by the ELC sector was over

• reinforced through the various COVID-19 related funding commitments[1] the last 12 months. The Federal Government has recently committed a further investment of $1.7 billion[2] to the sector to:

• Support ongoing economic recovery in the short term; and

• Improve workforce participation, gender equality, women’s financial .

• security and economic activity over the medium to long term[3]

• https://www.dese.gov.au/covid-19/childcare; https://ministers.dese.gov.au/

• https://ministers.treasury.gov.au/ministers/josh-frydenberg-2018/media-releases/making-child-care-more-affordable-and-boosting 3. https://grattan.edu.au/wp-content/uploads/2020/08/Cheaper-Childcare-Grattan-Institute-Report.pdf

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5 A R E N A R E I T 2 0 2 1 F U L L Y E A R R E S U L T S

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• SUSTAINABILTY Investment proposition and approach drives sustainability and commercial outcomes

Sustainability outcome

• Develop, own and manage social infrastructure property which facilitates access to essential educational and healthcare services provided by our current tenant partners across multiple local communities.

• Installation of solar renewable energy systems reduces the carbon emissions of tenant partners:

• 21% of Arena’s properties currently using; and

• Additional 45% of properties are in the process of installing.

• Increasing stakeholder engagement with regard to sustainability.

• Increasing and updating leading framework indicators.

• Additional sustainability priorities over the short and medium term for ongoing action and future reporting.

Commercial outcome

• Proven track record in securing and executing on high quality opportunities which provide efficient, flexible and well located accommodation at sustainable initial and ongoing rent.

• Disciplined investment process delivering ongoing EPS, DPS and NAV growth.

• Operating cost savings for tenant partners.

• Rentalisation of cost of installation of renewable energy systems over the life of lease or increased valuation upside and predictability of income through lease extensions.

• Partnership approach delivers mutually beneficial outcomes for our team, tenant partners and ultimately our investors.

• Broadened universe of capital providers with mandate to invest.

6 A R E N A R E I T 2 0 2 1 F U L L Y E A R R E S U L T S

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FINANCIAL RESULTS

Gareth Winter Chief Financial Officer

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• FINANCIAL PERFORMANCE Ongoing investment supporting earnings and distribution growth

	FY21	FY20	Change	Change
	($’000)	($’000)	($’000)	(%)
Property income	59,808	53,844	5,964	+11%
Other income	541	559	(18)	-3%
Total operating income	60,349	54,403	5,946	+11%
Property expenses	(602)	(530)	(72)	+14%
Operating expenses	(4,382)	(4,291)	(91)	+2%
Finance costs	(3,422)	(5,738)	2,316	-40%
Net operating profit	51,943	43,844	8,099	+18.5%
Statutory net profit	165,351	76,641	88,710	+116%
Earnings per security (EPS1) (cents)	15.2	14.55	0.65	+4.5%
Distribution per security (DPS) (cents)	14.8	14.0	0.80	+6%

• Property income continues to increase due to: – Contracted annual rental growth and market rent reviews;

   - Acquisition of operating ELC properties; and ELC developments completed during FY20 and FY21.
  

• Higher statutory net profit arising from both increased property income and property valuation uplift, profits on sale of divested properties and positive revaluation of interest rate hedges.

• Finance costs lower due to reduced cost of debt and relatively higher capitalisation of interest due to increased development work in progress during FY21.

• EPS is calculated as net operating profit over weighted average number of securities on issue.

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• CONTRIBUTORS TO EPS GROWTH Rental growth and development completions supporting EPS growth

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18
- 0.60 15.20
0.85 - 0.15
16
14.55 0.55
14
12
10
8
6
FY20 EPS Contracted like-for-like Completed developments, Net operating expenses and Funding mix - equity FY21 EPS
rental income growth acquisitions and disposals other income
cents per share
1
EPS
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1. EPS is calculated as net operating profit over weighted average number of securities on issue.

9 A R E N A R E I T 2 0 2 1 F U L L Y E A R R E S U L T S

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FINANCIAL POSITION

Strong balance sheet supporting asset growth

As at	30 June 2021	30 June 2020	Change
	($m)	($m)	%
Total assets	1,151.5	1,012.6	14%
Investment properties	1,112.4	914.0	22%
Borrowings	240.0	215.0	12%
Net assets	878.9	751.9	17%
Securities on issue	343.6	327.3	5%
Net Asset Value (NAV) per security	$2.56	$2.22	+15%
Gearing1	19.9%	14.8%	+510bps

• Growth in total assets continues from the acquisition of operating properties, ELC development completions and property valuation uplift.

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•
Undrawn debt capacity of $90 million to fund the
balance of development pipeline of $57 million
and future growth opportunities.
Acquisition and development capital expenditure $m
$106
$100
$91
$81
$80
$71
$60
$40
$40
$20
$0
FY17 FY18 FY19 FY20 FY21
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1. Gearing calculated as ratio of net borrowings over total assets less cash.

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CAPITAL MANAGEMENT

Substantial capacity to fund new investment

As at	30 June 20211	30 June 2020	Change
Borrowings	$240m	$215m	+$25 million
Borrowings facility limit	$330m	$330m	-
Gearing2	19.9%	14.8%	+510bps
Weighted average facility term	3.7 years	3.5 years	+0.2 year
Weighted average cost of debt	2.65%	3.15%	-50bps
Interest cover ratio	8.9x	6.65x	+2.25x
Hedge cover	81%	80%	+100bps
Weighted average hedge rate	1.67%	2.20%	-53bps
Weighted average hedge term	4.4 years	4.7 years	-0.3 year

1. Incorporates the extension of the $130 million facility tranche to 31 March 2026 (previously 31 March 2023) and additional hedging completed post 30 June 2021.

2. Syndicated borrowing facility limit of $330 million comprised of:

3. $150 million expiring 31 March 2024;

4. – $50 million expiring 31 March 2025; and

5. – $130 million expiring 31 March 2026.

6. DRP in operation – $11.4 million raised in FY2021.

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Hedge maturity profile $m
$193
$200 2.00%
$185
$180
$160 $156 1.80%
$140
$128
$120 1.60%
$101
$100
$80 1.40%
$60
$40 1.20%
$20
$0 1.00%
FY22 FY23 FY24 FY25 FY26
Average debt hedged (LHS) Average hedge rate (RHS)
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1. Gearing calculated as ratio of net borrowings over total assets less cash.

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PORTFOLIO UPDATE

Rob de Vos Managing Director

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PORTFOLIO OVERVIEW	PORTFOLIO OVERVIEW	PORTFOLIO OVERVIEW	PORTFOLIO OVERVIEW	PORTFOLIO OVERVIEW	PORTFOLIO OVERVIEW	PORTFOLIO OVERVIEW
	Number of assets	30 June 2021 valuation	Net valuation movement versus 30 June 2020		30 June 2021 passing yield	Change versus 30 June 2020
		$m	$m	%	%	bps
ELC portfolio	238	959	+92.0	+11.8%	5.84%	(40)
Healthcare portfolio	11	153	+15.6	+11.4%	5.34%	(78)
Total portfolio	249	1,112	+107.6	+11.8%	5.77%	(45)
86% 14% Sector diversity (by value) ELC Healthcare 34% 29% 20% 8% 6%3% 1% Geographic diversity (descending by value) QLD VIC NSW WA SA TAS NT 27 17 10% 7% 6% 6% 4% 3% 2% 18% Tenant diversity (descending by incom Goodstart Green Leaves BGH Fund Affinity G8 Education Edge Petit Oxanda SACare Other

Tenant diversity (descending by income)

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Goodstart
Green Leaves 18%
27%
BGH Fund
Affinity
2%
G8 Education
3%
Edge
Petit 4%
Oxanda
6%
SACare
Other
6%
17%
7%
10%
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Totals may not add due to rounding.

13 A R E N A R E I T 2 0 2 1 F U L L Y E A R R E S U L T S

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LEASE EXPIRY PROFILE[1 ]

Weighted average lease expiry increased to 20.1 years[2]

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35%
Healthcare (%) ELC (%)
31.7%
30%
25%
20%
15%
11.3%
10%
8.2%
5.4% 1.4%
3.9%
0.6%
4.3%
5%
4.8% 2.5% 2.9% 1.8%
0.2% 2.6% 2.4%
0.3% 2.2%
0.7% 0.4% [5.7% 4.7% ]
0.6% 0.3% 0.7% 0.4%
0%
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1. Pro-forma WALE as at 30 June 2021. 2. By income.

2. Post balance date portfolio lease renegotiation with Goodstart included an increase of 25 years of term on 87 ELC properties across Australia.

3. Seven operating ELC properties added to portfolio with initial weighted average lease term of 27.3 years.

4. • 14 ELC development completions added to portfolio with initial weighted average lease term of 20.8 years.

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Portfolio WALE (years)
22
20.1 [1 ]
20
18
16
14.1 14.0
14 12.9
12.8
12
10 9.7
8.9
8.5
8
6
FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21
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14 A R E N A R E I T 2 0 2 1 F U L L Y E A R R E S U L T S

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ANNUAL RENT REVIEWS

FY21 average like-for-like rent increase of +3.3%[1 ]

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100%
3.4% 2.4%
8.1%
9.0% 16.0%
11.5%
11.2%
80% 8.8%
11.2%
60%
40%
78.0%
76.5%
64.0%
20%
0%
FY22 FY23 FY24
Higher of 'agreed fixed amount' or CPI CPI linked review Fixed Review Market review
income
rental
%
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• All FY20 and FY21 market reviews were resolved at an average increase of +6.5%; these review outcomes apply from the original review date.

• 16% of FY24 reviews are market rent reviews; all are subject to a 0% collar and approximately half are subject to a 7.5% cap and approximately half are uncapped.

• • >76% of annual reviews in FY22 and FY23 will increase at the higher of an agreed fixed amount or CPI.

• Includes 25 market rent reviews from FY20 and 11 from HY21 which were all resolved at an average increase of +6.5%. 2. Totals may not add due to rounding.

15 A R E N A R E I T 2 0 2 1 F U L L Y E A R R E S U L T S

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ACQUISTIONS AND	ACQUISTIONS AND	ACQUISTIONS AND	ACQUISTIONS AND
DEVELOPMENTS
Delivering essential community service accommodation
• High quality, purpose built properties with existing and new tenant partners.
• 14 ELC development projects were completed in		FY21.
• Development pipeline scheduled to be completed over FY22 and FY23.
Acquisitions/development completions Number	of properties	Total	cost ($m)				Initial yield on total cost (%)		Initial weighted average lease term (years)
Operating ELC acquisitions	7		40.4					6.1	27.3
ELC development completions	14		74.7					6.6	20.8
Total/weighted average	21	115.1						6.4	23.0
Development pipeline1
Number of projects		15
Forecast total cost		$91 million
Initial yield on total cost		6.2%
Capex amount outstanding		$57 million
1. Includes two ELC projects that were conditionally contracted prior to, and one ELC project that was unconditionally contracted post, 30								June 2021.
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16 A R E N A R E I T 2 0 2 1 F U L L Y E A R R E S U L T S

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• ELC OPERATING ENVIRONMENT

• Strong macroeconomic drivers continue to support Australian ELC sector

Female Workforce Participation Rate[4]

• Government support was improved by the introduction of Childcare Subsidy (CCS) in July 2018 and the essential nature of the services provided by the ELC sector was reinforced through the various COVID19 related funding commitments[1] over the last 12 months.

• The Federal Government has recently committed a further investment of $1.7 billion[2] to the sector to:

• Support ongoing economic recovery in the short term; and

• Improve workforce participation, gender equality, women’s financial .

• security and economic activity over the medium to long term[3]

• Strong structural demand for services and record female workforce participation rate continue to drive increased long day care (LDC) .

• participation rates over the medium to long term[4,5]

• .

• Net new ELC supply to 30 June 2021 was +3.65%[6]

• https://www.dese.gov.au/covid-19/childcare/; https://ministers.dese.gov.au/.

• . https://ministers.treasury.gov.au/ministers/josh-frydenberg-2018/media-releases/making-child-care-more-affordable-and-boosting

• https://grattan.edu.au/wp-content/uploads/2020/08/Cheaper-Childcare-Grattan-Institute-Report.pdf.

• ABS Female Labour Force Participation Rate (aged 20-74 at least one dependant child of ELC age).

• Australian Government ‘Early Childhood and Child Care in Summary’ Reports 2012-2020.

• https://www.acecqa.gov.au/resources/national-registers.

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68%
65%
63%
60%
58%
55%
53%
50%
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LDC participation rate [5 ]
55%
53%
50%
48%
45%
43%
40%
38%
35%
Dec-10 Dec-11 Dec-12 Dec-13 Dec-14 Dec-15 Dec-16 Dec-17 Dec-18 Dec-19 Dec-20
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17 A R E N A R E I T 2 0 2 1 F U L L Y E A R R E S U L T S

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ELC PORTFOLIO Portfolio strength continues to be underpinned by quality offering

100% portfolio occupancy as at 30 June 2021.

Arena’s ELC portfolio operating data[1] to 31 March 2021:

• Overall ELC occupancy is higher as compared with previous average 31 March occupancy.

• :

• Average daily fee of $114.16[2]

• +0.44% from 31 December 2020[2] ; and

• +4.51% from 31 March 2020[2] .

• Net rent to revenue ratio of 11.0%[2] .

• Arena analysis based on operating data provided by Arena’s tenant partners as at 31 March 2021.

• COVID-19 related impacts to ELC operator revenues, government subsidies and attendances may diminish the like-for-like accuracy of these measures during the period.

• Assumes CCS fully covers a daily fee of approximately $135.40 based on CCS capped hourly fee of $12.31 per hour over an 11 hour day.

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Arena ELC portfolio – net rent to gross operator revenue [1,2]
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15%
14%
13%
12%
11%
10%
9%
8%
7%
6%
5%
HY16 FY16 HY17 FY17 HY18 FY18 HY19 FY19 HY20 FY20 HY21 FY21
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Arena ELC portfolio - average daily fee per place [1,2,3]
CCS benchmark daily fee
40%
30%
20%
10%
0%
<$80 $80-$90 $90-$100 $100-110 $110-$120 $120-$130 $130-$140 $140+
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18 A R E N A R E I T 2 0 2 1 F U L L Y E A R R E S U L T S

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HEALTHCARE SECTOR & PORTFOLIO

Strongly sought after asset class

• Strong structural macro-economic drivers continue to support Australian healthcare accommodation including growing and ageing population and increased prevalence of chronic health conditions.

• Medical centres participating in COVID-19 vaccination roll-out.

• Strong occupancy has been maintained across the specialist disability accommodation portfolio.

• Increased domestic and international interest in Australian healthcare property and increasing interest in social infrastructure property more generally.

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19 A R E N A R E I T 2 0 2 1 F U L L Y E A R R E S U L T S

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• OUTLOOK Long term income predictability with inflation protection

INCOME GROWTH

• FY22 distribution guidance of 15.8 cents per security, an increase of 6.8%[1] on FY21.

• Annual rent increases:

• 76% of rent reviews in FY22 and FY23 will increase at the higher of an agreed fixed amount or CPI; and

• o 16% of FY24 reviews are market rent reviews.

• Full impact of FY21 and partial impact of FY22 acquisitions and development completions.

• • .

• $91 million development pipeline comprising 15 ELC projects[2]

OUTLOOK

• Essential nature of early learning and healthcare reinforced through COVID-19 period.

• Gearing[3] at 19.9%, no debt expiry until March 2024.

• Proven ability to secure and execute on high quality opportunities while maintaining a disciplined investment process for opportunities that meet Arena’s preferred property characteristics.

• Guidance is estimated on a status quo basis assuming no new acquisitions or disposals, all developments in progress are completed in line with forecast assumptions, tenants comply with their existing or adjusted lease obligations and is based on Arena’s current assessment of the future impact of COVID-19 pandemic (which is subject to a wide range of uncertainties) and assumes ongoing government support of the early learning sector.

• Includes two ELC projects that were conditionally contracted prior to, and one ELC project that was unconditionally contracted post, 30 June 2021.

Investment objective: To deliver an attractive and predictable distribution to investors with earnings growth prospects over the medium to long term.

1. Gearing calculated as ratio of net borrowings over total assets less cash.

20 A R E N A R E I T 2 0 2 1 F U L L Y E A R R E S U L T S

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QUESTIONS

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CORPORATE DIRECTORY

Please direct enquiries to Sam Rist on samantha.rist@arena.com.au

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ROB DE VOS
Managing Director
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GARETH WINTER
Chief Financial Officer
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SAM RIST
Head of Investor Relations
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22 A R E N A R E I T 2 0 2 1 F U L L Y E A R R E S U L T S

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APPENDICES

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FINANCIAL PERFORMANCE – FY21

	FY21	FY20	Change	Change
	($’000)	($’000)	($’000)	%
Property income	59,808	53,844	5,964	+11%
Other income	541	559	(18)	-3%
Total operating income	60,349	54,403	5,946	+11%
Property expenses	(602)	(530)	(72)	+14%
Operating expenses	(4,382)	(4,291)	(91)	+2%
Finance costs	(3,422)	(5,738)	2,316	-40%
Net operating profit (distributable income)	51,943	43,844	8,099	+18.5%
Non-distributable items:
Investment property revaluation & straight-lining of rent	107,651	36,926	70,725
Change in fair value of derivatives	4,949	(4,104)	9,053
Profit/(loss) on sale of investment properties	1,909	1,303	606
Transaction costs	(39)	(144)	105
Amortisation of equity-based remuneration (non-cash)	(983)	(1,155)	172
Other	(79)	(29)	(50)
Statutory net profit	165,351	76,641	88,710

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BALANCE SHEET – FY21

	30 June 21	30 June 20	Change	Change
	($’000)	($’000)	($’000)	%
Cash	14,018	76,330	(62,312)	-82%
Receivables and other assets	14,246	11,427	2,819	+25%
Investment properties	1,112,431	914,007	198,424	+22%
Intangibles	10,816	10,816	-	-
Total assets	1,151,511	1,012,580	138,931	+14%
Trade and other liabilities	14,455	11,218	3,237	+29%
Distributions payable	12,801	22,419	(9,618)	-43%
Borrowings	239,163	213,953	25,210	+12%
Derivatives	6,174	13,110	(6,936)	-53%
Total liabilities	272,593	260,700	11,893	+5%
Net assets	878,918	751,880	127,038	+17%
Number of securities on issue (m)	343.6	327.3	+16.3m	+5%
Net asset value per security ($)	2.56	2.22	$0.34	+15%
Gearing1(%)	19.9	14.8	+510bps	+34%

1. Gearing calculated as ratio of net borrowings over total assets less cash.

	Covenant Facility requirement Ratio Loan to value ratio (LVR) Maximum 50% 21.6% Interest cover ratio (ICR) Minimum 2x 8.9x

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PORTFOLIO COMPOSITION AND
MOVEMENT
Portfolio movements (30 June 2020 to 30 June 2021) [1 ]
250
9 12
240 7
6
230 17
220
14
210
200
239
236 236 237
190
222 222
180
170
160
150
30-Jun-20 Development sites Development projects Operating properties Operating properties 30-Jun-21
acquired completed acquired divested
Existing portfolio Development pipeline
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1. Excludes two ELC projects that were conditionally contracted prior to, and one ELC project that was unconditionally contracted post, 30 June 2021.

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ELC PORTFOLIO VALUATIONS	ELC PORTFOLIO VALUATIONS	ELC PORTFOLIO VALUATIONS	ELC PORTFOLIO VALUATIONS
As at 30 June 2021	Number of properties	Value ($m)	Passing yield (%)
Independent ELC freehold valuations
Queensland	15	$ 59.7	5.83%
NewSouth Wales	2	$ 8.1	5.40%
Victoria	12	$ 45.6	5.42%
Western Australia	4	$ 12.5	5.94%
Tasmania	5	$ 17.7	6.21%
Northern Territory	2	$ 5.4	6.36%
Total independent ELC freehold valuations	40	$ 149.0	5.75%
Director ELC freehold valuations
Queensland	65	$ 278.2	6.08%
New South Wales	30	$ 103.3	5.82%
Victoria	54	$ 254.3	5.38%
South Australia	8	$ 36.7	6.02%
Western Australia	20	$ 69.6	5.83%
Tasmania	3	$ 11.6	6.25%
Totaldirector ELCfreeholdvaluations	180	$ 753.7	5.79%
Total freeholdELC portfolio	220	$ 902.7	5.78%
IndependentELCleaseholdvaluations– Victoria	6	$ 16.5	8.90%
Total ELC portfolio excluding development sites	226	$ 919.2	5.84%
ELC development sites	12	$ 40.0	n/a
Total ELC portfolio	238	$ 959.2	5.84%

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ELC PORTFOLIO METRICS

	30 June 2021	30 June 2020	Change
Leased ELCs	226	211	+15
Development sites	121	17	-5
Total ELCs	238	228	+10
WALE (by income) (years)	21.42	14.2	+7.2 years
Tenanted occupancy (%)	100	100	-
Average passing yield (%)	5.84	6.24	-40bps
Portfolio value ($m)	959.1	777.4	+23%
Average rental increase (%)	3.64	3.9	-26bps
Rent to gross revenue ratio (%)	11.03	10.74	+30bps
Average daily fee ($)	114.163	109.234	+5%
Portfolio composition (% by value)
Metropolitan %	68	65	+300bps
Regional %	32	35	-300bps

1. Excludes two ELC projects that were conditionally contracted prior to, and one ELC project that was unconditionally contracted post, 30 June 2021.

2. Post balance date portfolio lease renegotiation with Goodstart included an increase of 25 years of term on 87 ELC properties.

3. Arena analysis based on operating data provided by Arena’s tenant partners as at 31 March 2021; COVID-19 related impacts to ELC operator revenues, government subsidies and attendances may diminish the like-for-like accuracy of these measures during the period.

4. Arena analysis based on operating data provided by Arena’s tenant partners as at 31 March 2020; COVID-19 related impacts to ELC operator revenues, government subsidies and attendances may diminish the like-for-like accuracy of these measures during the period.

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HEALTHCARE PORTFOLIO METRICS 30 June 2021 30 June 2020 Change Total healthcare properties 11 11 - WALE (by income) (years) 11.9 12.8 -0.9 years Tenanted occupancy (%) 100 100 - Average passing yield (%) 5.34 6.12 -78bps Property portfolio ($m) 153.3 136.6 +12% Average rental increase (%) 1.7 2.25 -55bps Portfolio composition (% by value) Metropolitan % 91 91 - Regional % 9 9 -	HEALTHCARE PORTFOLIO METRICS 30 June 2021 30 June 2020 Change Total healthcare properties 11 11 - WALE (by income) (years) 11.9 12.8 -0.9 years Tenanted occupancy (%) 100 100 - Average passing yield (%) 5.34 6.12 -78bps Property portfolio ($m) 153.3 136.6 +12% Average rental increase (%) 1.7 2.25 -55bps Portfolio composition (% by value) Metropolitan % 91 91 - Regional % 9 9 -	HEALTHCARE PORTFOLIO METRICS 30 June 2021 30 June 2020 Change Total healthcare properties 11 11 - WALE (by income) (years) 11.9 12.8 -0.9 years Tenanted occupancy (%) 100 100 - Average passing yield (%) 5.34 6.12 -78bps Property portfolio ($m) 153.3 136.6 +12% Average rental increase (%) 1.7 2.25 -55bps Portfolio composition (% by value) Metropolitan % 91 91 - Regional % 9 9 -	HEALTHCARE PORTFOLIO METRICS 30 June 2021 30 June 2020 Change Total healthcare properties 11 11 - WALE (by income) (years) 11.9 12.8 -0.9 years Tenanted occupancy (%) 100 100 - Average passing yield (%) 5.34 6.12 -78bps Property portfolio ($m) 153.3 136.6 +12% Average rental increase (%) 1.7 2.25 -55bps Portfolio composition (% by value) Metropolitan % 91 91 - Regional % 9 9 -
	30 June 2021	30 June 2020	Change
Total healthcare properties	11	11	-
WALE (by income) (years)	11.9	12.8	-0.9 years
Tenanted occupancy (%)	100	100	-
Average passing yield (%)	5.34	6.12	-78bps
Property portfolio ($m)	153.3	136.6	+12%
Average rental increase (%)	1.7	2.25	-55bps
Portfolio composition (% by value)
Metropolitan %	91	91	-
Regional %	9	9	-

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• PORTFOLIO LOCATION MAP

• Excludes two ELC projects that were conditionally contracted prior to, and one ELC project that was unconditionally contracted post, 30 June 2021.

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% % % % % % % %									% %																						% % %
								7	%																					7	%
								6	%																					6	%
									% % % %																						% % % %

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ELC SALES YIELDS VERSUS 10 YEAR BOND Average ELC Sales Yield versus 10 Year Australian Government Bond Yield 10.00% 9.00% 8.00% 7.00% 6.00% 5.00% 4.00% 3.00% 2.00% 1.00% 0.00% ELC Sales Yield (three month rolling average all states) 10 Year Govt Bond Yield

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IMPORTANT NOTICE This presentation has been prepared by Arena REIT (Arena) comprising Arena REIT Limited (ACN 602 365 186), Arena REIT Management Limited (ACN 600 069 761 AFSL No. 465754) as responsible entity of Arena REIT No.1 (ARSN 106 891 641) and Arena REIT No.2 (ARSN 101 067 878) and is authorised to be given to the ASX by Gareth Winter, Company Secretary. The information contained in this document is current only as at 30 June 2021 or as otherwise stated herein. This document is for information purposes only and only intended for the audience to whom it is presented. This document contains selected information and should be read in conjunction with the Financial Report for the year ended 30 June 2021 lodged with the ASX on 11 August 2021 and other ASX announcements released from time to time. This document may not be reproduced or distributed without Arena’s prior written consent. The information contained in this document is not investment or financial product advice and is not intended to be used as the basis for making an investment decision. Arena has not considered the investment objectives, financial circumstances or particular needs of any particular recipient. You should consider your own financial situation, objectives and needs, conduct an independent investigation of, and if necessary obtain professional advice in relation to, this document.

Except as required by law, no representation or warranty, express or implied, is made as to the fairness, accuracy, completeness or correctness of the information, opinions and conclusions, or as to the reasonableness of any assumption, contained in this document. By receiving this document and to the extent permitted by law, you release Arena and its directors, officers, employees, agents, advisers and associates from any liability (including, without limitation, in respect of direct, indirect or consequential loss or damage or any loss or damage arising from negligence) arising as a result of the reliance by you or any other person on anything contained in or omitted from this document.

This document contains certain forward-looking statements along with certain forecast financial information. The words “anticipate”, “believe”, “expect”, “project”, “forecast”, “guidance”, “estimate”, “outlook”, “upside”, “likely”, “intend”, “should”, “could”, “may”, “target”, “plan”, and other similar expressions are intended to identify forward-looking statements. The forward-looking statements are made only as at the date of this document and involve known and unknown risks, uncertainties, assumptions and other important factors, many of which are beyond the control of Arena and its directors. Such statements reflect the current expectations of Arena concerning future results and events, and are not guarantees of future performance. Actual results or outcomes for Arena may differ materially from the anticipated results, performance or achievements expressed, projected or implied by these forward-looking statements or forecasts. Other than as required by law, although they believe that there is a reasonable basis for the forward-looking statements, neither Arena nor any other person (including any director, officer or employee of Arena or any related body corporate) gives any representation, assurance or guarantee (express or implied) that the occurrence of these events, or the results, performance or achievements expressed in or implied by any forward-looking statements in this announcement will actually occur and you are cautioned not to place undue reliance on such forward-looking statements. Risk factors (which could be unknown or unpredictable or result from a variation in the assumptions underlying the forecasts) could cause actual results to differ materially from those expressed, implied or projected in any forward-looking statements or forecast. Past performance is not an indicator or guarantee of future performance or results.

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