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Brookfield Global Listed Real Estate
Q1 2019
© 2019 Brookfield Public Securities Group LLC
Brookfield’s Real Estate Business & Securities Team
Jason Baine Bernhard Krieg, CFA Iconic Brookfield Assets1
Portfolio Manager Portfolio Manager
23 Years of Investing Experience 21 Years of Investing Experience
18 Years with Brookfield 13 Years with Brookfield
Launched Brookfield’s real estate Extensive long/short and real estate
securities platform in 2001 securities experience
Supported by Nine Analysts
Average 13 years experience 5 Manhattan West | New York
Cross-border coverage with regular coverage rotations
Centralized team in Chicago
One of the largest real estate investors in the world1 CityPoint | London
Brookfield Place | Toronto
History of buying assets on a value basis
Own some the world’s most iconic real estate assets
Global operator for over 120 years1 Woodlands Mall | Houston Brookfield Place | New York
$188 billion1
REAL ESTATE ASSETS
UNDER MANAGEMENT Canary Wharf | London
As of December 31, 2018. 1. Assets under management for Brookfield Asset Management Inc. includes its affiliates. Brookfield Public Securities Group LLC has approximately $20
billion in total assets under management as of December 31, 2018 and includes discretionary, non-discretionary and administrative. Values may not add to the total due to rounding.
Iconic Brookfield Assets are not held be the fund.
2
Why Do Demographics Matter?
Population Growth Home Price Growth
(2001-2017) (2001-2017)
30% 120%
27%
101%
90%
20% ~2X ~2X
Growth Growth
14% 60%
52%
10%
30%
0% 0%
Population Median Home Price
U.S. Seattle U.S. Seattle
As of July 2, 2018. Source: Biggest US Cities by Population; Zillow Home Value Index
3
Cost of Living
2 Parent & 2 Child Households – Per Month
San Francisco Austin
Housing $3,121 -$1,870 Housing $1,251
Food $998 Food $738
Child Care $1,730 Child Care $1,108
Transportation $1,114 Transportation $1,150
Health Care $1,152 Health Care $964
Other Necessities $1,662 Other Necessities $802
Taxes $2,593 -$1,875 Taxes $718
Monthly Total $12,370 -$5,639 Monthly Total $6,731
New York City Nashville
Housing $1,789 -$787 Housing $1,002
Food $908 Food $792
Child Care $2,773 Child Care $1,052
Transportation $589 Transportation $1,170
Health Care $1,238 Health Care $1,170
Other Necessities $1,088 Other Necessities $724
Taxes $1,958 -$1,265 Taxes $693
Monthly Total $10,343 -$3,740 Monthly Total $6,603
As of March 2018. Source: Economic Policy Institute. Costs are in 2017 dollars
4
Quality of Life
Average One-Way Average Yearly
Commute Time Temperature
Austin 23.8 min Miami 77.05 F
Nashville 24.3 min Austin 69.4 F
Miami 28.5 min Nashville 59.25 F
Chicago 31.3 min San Francisco 57.3 F
San Francisco 32.4 min New York 55.15 F
New York City 40.3 min Chicago 51.3 F
As of December 20, 2017. Source: US Census Bureau 2016; usclimatedata.com
5
Current State Income Taxes
As of March 5, 2018. Source: taxfoundation.org 2018
6
Future Tax Liabilities – Pension Liabilities
Pension Promises Grew Faster than GDP Funded Ratios Declining
(2003-2016) (2003-2016)
New York New York
141% difference
New Jersey New Jersey
-62% difference
California
California
Illinois
Illinois
Tennessee
Tennessee
Texas
Texas
0% 20% 40% 60% 80% 100% 120% 140% 160% 180% 0% 20% 40% 60% 80% 100% 120%
2003
GDP
Accrued Liabilities 2016
As of July 20, 2018. Source: Overpromising has crippled public pensions. A 50-state survey by Ted Dabrowski and John Klinger
7
Future Tax Liabilities – Aging Infrastructure
Aging Infrastructure by Area
60%
50%
40%
30%
20%
10%
0%
CALIFORNIA NEW YORK ILLINOIS NORTH TEXAS TENNESSEE FLORIDA
CAROLINA
% of Roads in Poor Condition % of Structurally Deficient Bridges
As of April 10, 2018. Source: U.S. Department of Transportation; 2017 Infrastructure Report Card.
8
Historical Population Growth
Coastal & Northern Sunbelt
3.5% 3.5%
3.0% 3.0%
2.5% 2.5%
2.0% 2.0%
1.5% 1.5%
1.0% 1.0%
0.5% 0.5%
0.0% 0.0%
2011
2012
2013
2014
2015
2016
2017
2011
2012
2013
2014
2015
2016
2017
San Francisco New York Austin Nashville
As of December 20, 2017. Source: U.S. Census Bureau, 2017.
9
Faster Growth in Sunbelt Talent Pools
Texas Tennessee
Residents with bachelor’s Residents with bachelor’s
degrees degrees
3.2M 21.0% 712K 16.7%
Total Growth Total Growth
(2010-2016) (2010-2016)
549K 102K
New since 2010 New since 2010
California New Jersey New York
Residents with bachelor’s Residents with bachelor’s Residents with bachelor’s
degrees degrees degrees
5.1M 13.7% 1.7M 2.7M 12.1%
Total Growth
Total
10.8% Total
Growth
(2010-2016) Growth
619K 138K (2010-2016) 286K (2010-2016)
New since 2010 New since 2010
New since 2010
As of December 20, 2017. Source: U.S. Census Bureau 2016.
10Recent Corporate Relocations and Expansions
Austin Nashville
Company Jobs Company Jobs
Apple 5k - 15,000 Amazon 5,000
Oracle 10,000 Alliance Bernstein 1,050
Charles Schwab 1,500 Asurion 400
Indeed 1,500 Tenneco 200
Amazon 800 Five Star Custom Foods 138
General Motors 500 Medline Industries 100
PIMCO 200
As of September 1, 2018. Source: Austin Chamber of Commerce (2017-2018); Nashville Chamber of Commerce (2017-2018).
11Dual Demographic Wave
Annual U.S. Population Change
Forecasted
Annual U.S. Population Change
Forecasted
(Ages 25-45) (Ages 65+)
2.2 2.2
2 2
1.8 1.8
1.6 1.6
1.4 1.4
1.2 1.2
Millions
Millions
1 1
0.8 0.8
0.6 0.6
0.4 0.4
0.2 0.2
0 0
1970
1972
1974
1976
1978
1980
1982
1984
1986
1988
1990
1992
1994
1996
1998
2000
2012
2014
2016
2018
2020
2022
2024
1970
1972
1974
1976
1978
1980
1982
1984
1986
1988
1990
1992
1994
1996
1998
2000
2002
2004
2006
2008
2010
2012
2014
2016
2018
2020
2022
2024
As of December 20, 2017. Source: U.S. Census Bureau 2017 National Population Projection Data.
12Migration Pattern
As of December 20, 2017. Source: U.S. Census Bureau 2017
13Higher Growth in Sunbelt Office Jobs
Coastal & Northern Sunbelt
6% 6%
5% 5%
4% 4% 50% growth
3% 3%
40% growth
2% 21% growth
2%
1% 1%
7% growth
0% 0%
-1% -1%
-2% -2%
-3% -3%
-4% -4%
-5% -5%
-6%
-6%
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
San Francisco New York Austin Nashville
As of January 31, 2018. Source: Bureau of Labor Statistics (BLS) and Baird Research.
14Office Employment & Net Migration Forecasts
Q2 2018 – Q2 2020 Forecast
3.0% Austin
Orlando
Houston
Dallas
2.5%
Las Vegas Tampa
San Antonio
Office-using Employment Growth
Phoenix Raleigh
2.0%
Miami
Nashville
Memphis
1.5% Baltimore Charlotte
Atlanta U.S. National
Chicago
Sacramento
San Diego
1.0% Los Angeles Norfolk
Boston
San Francisco
New York
0.5%
Washington D.C.
0.0%
-2.0% -1.0% 0.0% 1.0% 2.0% 3.0% 4.0% 5.0% 6.0%
Net Migration (% of Population)
Gateway Major Non-Gateway Secondary Sunbelt Secondary Snowbelt
As of September 13, 2018. Source: Cushman & Wakefield.
15Office Supply
San Francisco Austin
Forecasted
Forecasted
5% 40% 12% 40%
35% 35%
4% 10%
30% 30%
8%
3% 25% 25%
20% 6% 20%
2% 15% 15%
4%
10% 10%
1% 2%
5% 5%
0% 0% 0% 0%
1988
1990
1992
1994
1996
1998
2000
2002
2004
2006
2008
2010
2012
2014
2016
2018
2020
2022
1988
1990
1992
1994
1996
1998
2000
2002
2004
2006
2008
2010
2012
2014
2016
2018
2020
2022
Completions (% of existing stock) Vacancy Rate Completions (% of existing stock) Vacancy Rate
New York Forecasted Nashville
Forecasted
4% 20% 8% 25%
3% 18% 7%
2% 16% 20%
6%
1% 14%
12% 5% 15%
0%
10% 4%
-1%
8% 3% 10%
-2% 6%
-3% 2%
4% 5%
-4% 2% 1%
-5% 0% 0% 0%
1988
1990
1992
1994
1996
1998
2000
2002
2004
2006
2008
2010
2012
2014
2016
2018
2020
2022
1988
1990
1992
1994
1996
1998
2000
2002
2004
2006
2008
2010
2012
2014
2016
2018
2020
2022
Completions (% of existing stock) Vacancy Rate Completions (% of existing stock) Vacancy Rate
As of December 31, 2018. Source: CBRE Econometric Advisors.
16Office Rents
Cumulative Rent Growth
200%
164%
150% 158%
100%
75%
65%
50%
0%
-50%
1988
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
San Francisco Austin New York Nashville
As of December 31, 2018. Source: CBRE Econometric Advisors.
17Apartment Supply
San Francisco Austin
Forecasted
Forecasted
6% 9% 6% 9%
8% 8%
5% 5%
7% 7%
4% 6% 4% 6%
5% 5%
3% 3%
4% 4%
2% 3% 2% 3%
2% 2%
1% 1%
1% 1%
0% 0% 0% 0%
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
Completions (% of existing stock) Vacancy Completions (% of existing stock) Vacancy
New York Nashville
Forecasted
Forecasted
6% 9% 6% 9%
8% 8%
5% 5%
7% 7%
4% 6% 4% 6%
5% 5%
3% 3%
4% 4%
2% 3% 2% 3%
2% 2%
1% 1%
1% 1%
0% 0% 0% 0%
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
Completions (% of existing stock) Vacancy Completions (% of existing stock) Vacancy
As of December 31, 2018. Source: Axiometrics, a RealPage Company.
18Apartment Rents
Cumulative Rent Growth
80%
70% 71%
60%
55%
50%
50%
40%
30%
25%
20%
10%
0%
-10%
-20%
1Q08
3Q08
1Q09
3Q09
1Q10
3Q10
1Q11
3Q11
1Q12
3Q12
1Q13
3Q13
1Q14
3Q14
1Q15
3Q15
1Q16
3Q16
1Q17
3Q17
1Q18
3Q18
San Francisco Austin New York City Nashville
As of December 31, 2018. Source: Axiometrics, a RealPage Company.
19Key Takeaways
Demographics drive demand for real estate
Demographic demand for Sunbelt cities is significantly
better
Strong case for both employees and employers to
migrate
We continue to watch supply closely, but not an issue
currently
Several attractively priced REITs with exposure to
Southern office and residential markets in the portfolio
As of June 30, 2018. Past performance is not indicative of future results.
20What We See As Benefits of REIT Investing
Exposure to
Real Estate
REIT Income
Equity
Investing Investing
Investing
Potential
Diversification
Diversification does not guarantee a profit nor protect from loss in a declining market. 21REITs – Attractive Investment Potential
Simple business
model, transparent Ability to access
quarterly reporting public and
monitored by private debt and
regulatory equity markets
agencies
Why
Invest in
REITs?
Professional Low
Management Leverage
Team
Daily
Liquidity
22REIT Company Examples
Major Cities - Office
Boston Properties SL Green
• Owns or holds interests in 197 commercial properties • New York City's largest owner of Office real estate
• Properties: Boston, Los Angeles, New York, San • Owns or holds interests in 30 Manhattan office buildings
Francisco and Washington, DC
Salesforce Tower (Rendering) San Francisco, CA, U.S. 420 Lexington Avenue New York, The Graybar Building.
Derwent London PLC Japan Real Estate Investment Corporation
• Derwent London owns predominantly an office portfolio in • The company owns a portfolio of 73 office properties
13 ‘villages’ in London’s West End and Tech Belt focused on the Tokyo market
The White Chapel Building London. Otemachi Financial City North Tower.
For illustrative purposes only. Information is as of March 31, 2019 and subject to change without notice. The mention of a specific security is not a recommendation to buy or sell.
Past performance is not indicative of future results.
23REIT Company Examples
Major Cities - Retail
Simon Property Group Inc Unibail-Rodamco-Westfield
• S&P 100 company with total market capitalization of $56 • One of Europe’s largest listed commercial property
billion companies, with a portfolio of over 150 retail assets
• Owns or has an interest in 200+ retail real estate properties throughout the EU, UK and US
Walt Witman Shops Huntington Station New York. Les Quatre Temps, Paris
Hammerson PLC Scentre Group
• Portfolio includes investments in 21 prime shopping • Scentre Group owns and operates 41 shopping centers in
centers in the U.K., Ireland and France Australia and New Zealand
Union Square Aberdeen, U.K. Westfield Bondi Junction, Sydney, Australia
For illustrative purposes only. Information is as of March 31, 2019 and subject to change without notice. The mention of a specific security is not a recommendation to buy or sell.
Past performance is not indicative of future results. 24Income and Capital Appreciation
Combination of Capital Appreciation and Income Return
(12/31/1996 – 3/31/2019)
Capital Appreciation
10%
8.90% Income
9%
8% Total Return
7% 3.65% 6.21%
6% 5.19%
5% 0.15%
4% 4.33%
3%
5.25% 5.04%
2%
1% 1.88%
0%
Global REITs Global Equities Global Bonds
Yield
(3/31/2019) 3.90% 2.65% 1.77%
Correlation with
Global REITs
(12/31/1996 – 1.00 0.77 0.57
3/31/2019)
As of March 31, 2019. Source: Bloomberg; Brookfield Public Securities Group LLC Reflects longest common available time period for all indexes shown. The index data presented above
includes is shown for illustrative purposes only. Global REITs represented by the S&P Developed REIT Index for the period 12/31/1996 through 1/31/2005 and the FTSE EPRA Nareit
Developed Index for the period 2/1/2005 to the latest date. Global Equities represented by the MSCI World Index; Global Bonds by the ICE BofAML Global Corporate Bond Index. See
end of this presentation for additional disclosures and definitions.
25Historical Hedge Against Inflation
• The growth in REIT distributions has historically outpaced the rate of inflation
• Property values have tended to rise during inflationary periods
REIT Dividend Growth vs. Inflation
12%
10.2%
9.6%
10%
8.6% 8.4%
8% 7.3%
6.5% 6.3%
6% 4.8%
4.1%
4% 3.0% 3.3% 4.4% Avg.
2.5% 2.7%
1.7% 2.1% 2.1% 1.9%
2% 1.5% 1.5%
0.5% 0.1%
0.8% 0.7% 1.9% Avg.
0%
-0.4% -0.4%
-2%
-4%
-6%
-8%
-7.5%
-10%
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Global REITs Annual Growth in Dividends per Share
U.S. Consumer Price Index
Sources: Bloomberg and Morningstar. Global REITs reflects factors relevant to any such comparison such as differences differ given different tax treatment of income versus capital
the FTSE EPRA Nareit Developed Index. The above in the volatility, and regulatory and legal restrictions between gain and other factors, such as the capital structure of the
indexes do not reflect deductions for fees, expenses or the indexes shown and an actively managed investment investment. Past performance does not guarantee results.
taxes. Indexes are not managed, and investors cannot strategy. See index definitions at the end of this The Consumer Price Index is a measure of the average
invest directly in an index. Performance is shown for presentation. Investing in real estate securities involves change over time in the prices paid by urban consumers for
illustrative purposes only and does not predict or depict the different risks, including the loss of principal. The tax a market basket of consumer goods and services.
performance of any investment. There may be material treatment of returns of the asset classes listed above may
26REIT Dividend Growth Has Historically Outpaced Inflation
Annual Growth In Dividends and Major Expenses (2006-2018)
College
5.0%
Tuition
REIT
4.5% Costs
Dividends
4.0%
Healthcare
3.5% Costs
3.0%
2.5% 75% 72%
Total Total
Core
2.0% Increase Increase 53% Inflation
Total
Increase
1.5% 28%
Total
1.0% Increase
0.5%
0.0%
REIT Dividend growth has outpaced core inflation as well as Healthcare Costs while also
keeping pace with the rapid rise in College Tuition Costs
Sources: Bloomberg and Bureau of Labor Statistics. Global REITs reflects the FTSE EPRA Nareit Developed Index. Core CPI represents U.S. CPI Urban Consumers; Healthcare Costs
represented by US CPI Urban Consumers Medical Care Services; College Tuition Costs represented by U.S. CPI College Tuition & Fees
27Real Estate Has Low Correlation With Equities
The correlation with broader equities has been below 0.5 during most periods
Trailing 5 year correlation between
U.S. REITs and U.S. Equities
0.9
0.8
0.7
0.6
0.5
0.4
0.3
0.2
0.1
0
Sources: Bloomberg U.S. REITs reflects the MSCI US REIT Total Return Gross Index. U.S. Equities represents the S&P 500 Total Return Index.
28Global Real Estate vs. Global Equities
Global Real Estate has underperformed Global Equities since the Fed began
raising rates, providing an attractive opportunity to add exposure
135
Global Equities
returned ~33% Global Equities
130 through 9/30/2018+30% During the period
125
120
Global
Global Equities Real Estate
fell
115 +15% During the period
13.3% in Q4
110 Global Real Estate
Global
returned ~6% Real Estate
105 was down only
through 9/30/2018
5.5% in Q4
100
95
90
Global Real Estate Securities Global Equities
As of March 31, 2019. Sources: Bloomberg, MSCI, FTSE EPRA Nareit. Global Real Estate represented by FTSE EPRA Nareit Developed Total Return Index USD; Global Equities
represented by MSCI World Gross Total Return USD Index.
29REIT Fund Flows
U.S. Mutual Fund and ETF Flows and AUM Japan Mutual Fund AUM
Source: Citi Research and Lipper as of 3/28/2019 Source: Citi Research and Bloomberg as of 3/28/19
30Balance Sheets Over The Past Decade
We believe significantly improved balance sheets decrease the risk associated with
rising rates
Debt to Total Assets: All listed U.S. equity REITs
70
65
FOMC Tightening Cycle
60
Debt/Market Assets
Debt to Total Assets (%)
55
50
45
40
35
30
25
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
As of September 30, 2018. Source: Nareit. FOMC: Federal Open Market Committee
31Average Global Valuations
Global Historical Premium (Discount) to NAV
30%
20%
10%
0%
-10%
Historical Average: -7.4% Current:
-5.9%
-20%
-30%
-40%
-50%
Global Premium (Discount) to NAV
Historical Average
As of March 31, 2019. Represents data beginning January 1995. Represents estimated average public market valuations relative to estimated average private market valuations for
global real estate. NAV or Net Asset Value is the "market value" of all a company's assets, including but not limited to its properties, after subtracting the “market value” of all its
liabilities and obligations. Source: UBS Global Real Estate Research; Brookfield Public Securities Group LLC research and estimates.
32Global Real Estate – Valuation Dispersions Across Geographies
Although global real estate in aggregate trades near its historical average, many
regions trade at meaningful discounts to their long-term averages
Premium (Discount) to NAV by Geography
80%
180%
60%
160%
40%
140%
20%
120%
0%
100%
-20%
80%
-40%
60%
-60%
40%
-80%
20%
Current
Historical 10th to 90th Percentile
Historical Maximum/Minimum
As of March 31, 2019. Represents data beginning January 1995. Valuation dataset duration varies by geography and is dependent on data availability for each individual market.
Represents estimated average public market valuations relative to estimated average private market valuations for each real estate market. NAV or Net Asset Value is the "market value"
of all a company's assets, including but not limited to its properties, after subtracting the “market value” of all its liabilities and obligations. The geographies and sectors are defined by
UBS Global Research and BMO Capital Markets and do not necessarily reflect any widely followed indexes. Source: UBS Global Real Estate Research; Brookfield Public Securities
Group research and estimates. Canada data sourced from BMO Capital Markets.
33U.S. Real Estate – Wide Valuation Spreads in Select Sectors
Intra-sector valuations remain wide in most U.S. sectors
Premium (Discount) to NAV by Sector
70%
60%
50%
40%
30%
20%
10%
0%
-10%
-20%
-30%
-40%
-50%
-60%
-70%
-80%
Office Industrial Diversified Apartment Healthcare Regional Mall Strip Center Net Lease Hotels Self-Storage
Current Sector Average
Current Range from Sector Minimum to Sector Maximum
As of March 31, 2019. Represents estimated average public market valuations relative to estimated average private market valuations for each real estate sector. NAV or Net Asset
Value is the "market value" of all a company's assets, including but not limited to its properties, after subtracting the “market value” of all its liabilities and obligations. Sectors are defined
by Brookfield Public Securities Group LLC research and estimates and do not necessarily reflect any widely followed indexes. Source: Brookfield Public Securities Group LLC research.
Information referenced herein represents U.S. Real Estate Securities and not specific Fund or Strategy information.
34The Real Estate Securities Team
Seasoned leadership team supported by a deep roster of analysts
Investment Jason Baine Bernhard Krieg, CFA
Leadership Portfolio Manager Portfolio Manager
23 Years of Investing Experience 21 Years of Investing Experience
18 Years with Brookfield 13 Years with Brookfield
Launched Brookfield’s real estate Extensive long/short and real estate
securities platform in 2001 securities experience
Analysts James Allison Jamieson Duff, CFA Anar Isman, CFA
Continental, Central and Eastern U.S. Industrial; U.S. Residential and Timber;
Europe; Nordic Countries Japanese REITS Japanese Developers; Canada
16 Years of Experience 8 Years of Experience 15 Years of Experience
7 Years with Brookfield 8 Years with Brookfield 7 Years with Brookfield
Kevin Mueller Julian Perlmutter, CFA Michael Shoemacher
Generalist U.S. Student Housing; Storage; Data U.S. Healthcare; United Kingdom;
2 Years of Experience Centers and Towers; Hong Kong; China Australia
1 Year with Brookfield 16 Years of Experience 15 Years of Experience
7 Years with Brookfield 7 Years with Brookfield
Richard Sweigard John Wallace, CFA Matt Wenman, CFA
U.S. Office, Diversified and U.S. Strip Center Retail; Product Specialist;
Regional Malls; Singapore Triple Net Lease; Global Hotels Portfolio and Market Analytics
18 Years of Experience 18 Years of Experience 13 Years of Experience
14 Years with Brookfield 3 Years with Brookfield 13 Years with Brookfield
Trader Rob Kosar
23 Years of Experience
14 Years with Brookfield
35Brookfield Global Listed Real Estate Fund Portfolio Characteristics
March 2019
Asset Allocation Allocation Changes
N. America -2.7% N. America +0.9%
U.S. Sectors
U.S. Portfolio U.S.
U.S. Sectors Current
Healthcare 10.0% Healthcare 10.0%
6.9% 6.2%
Residential 9.1% Residential 9.1%
8.7% 10.5%
Office 8.7% Office 8.7%
7.3% 5.6%
Net Lease 5.3% Net Lease 5.3%
5.9% 2.5%
Retail 4.9% Retail 4.9%
7.7% 11.1%
Self Storage 4.0% Self Storage 4.0%
3.6% Benchmark 2.3% One Year Ago
Hotel 3.6% Hotel 3.6%
3.3% 5.2%
Industrial 3.5% Industrial 3.5%
4.9% 3.0%
Data Centers 1.5% Data Centers 1.5%
2.1% 3.2%
Specialty 0.0% Specialty 0.0%
1.3% 2.7%
0.0% Diversified 0.0%
Diversified 1.4% 0.0%
Canada 2.5% Canada
Canada 2.5%
Canada 2.7% 0.0%
Asia Pacific +0.8% Asia Pacific +3.1%
12.2% Japan 12.2%
Japan 11.1% 12.3%
8.5% Hong Kong/China 8.5%
Hong Kong/China 8.5% 5.2%
3.8% Australia/N.Z. 3.8%
Australia/N.Z. 4.8% 3.7%
3.3% Singapore/Other 3.3%
Singapore/Other 2.7% 3.6%
Europe +1.0% Europe -2.2%
10.9% Continental Europe 10.9%
Continental Europe 12.4% 10.0%
7.2% U.K. 7.2%
U.K. 4.8% 10.4%
Active Weight
One Year Change
Portfolio
Current Portfolio
Benchmark
Portfolio One Year Ago
As of March 31, 2019 and includes Cash. Benchmark refers to the FTSE EPRA Nareit Developed Index. Weights and portfolio holdings are subject to change. Due to rounding,
amounts presented herein may not add up precisely to the total. See end of this presentation for additional disclosures and definitions. 36Southeastern & Midwest Multifamily REIT
o Established owner and operator of
multifamily apartment communities in
the Southeast and Midwest United Market Exposure
(% of Net Operating Income)
States
o Portfolio of over 100,000 units in 17
states
o $11.5B market capitalization 13%
o $126 million development pipeline
32%
9%
7%
4% 6%
5% 4%
6% 7%
7%
Acklen Apartments - Nashville
Atlanta, GA Dallas, TX
Charlotte, NC Austin, TX
Nashville, TN Washington, DC
Tampa, FL Orlando, FL
Canyon Point Apartments - Austin Raleigh/Durham, NC Fort Worth, TX
Other
As of June 30, 2018. Source: Company filings. Properties identified in the image are held indirectly by the Fund as of March 31, 2019. .
37Hong Kong – Office Landlord
Central portfolio creates a network effect of international commerce
Source: Company filings. Properties identified in the image are held indirectly by the Fund as of March 31, 2019. .
38Hong Kong – Office Landlord
Gross Assets as of June 30, 20181
90% Investment Properties
77% Hong Kong
Central office portfolio average rent
Central office market
continues to have
stable rent growth
As of June 30, 2018. Source: Company filings. Shown for illustrative purposes only
39Hong Kong – Office Landlord
Worries of a U.S./China trade war have caused a Portfolio trades well below replacement cost at
selloff for Hong Kong landlords, we believe this is US$1,800/SF
overdone • Henderson Land purchased an adjacent land site for
US$6,400/sf ($3bn) and are under-writing US$8,000/sf
Attractive Current Valuation total construction costs.
• 7.5% implied cap rate • Cheung Kong Assets Sold its “The Center” which is on
• Implied US$1,800/SF the border of Central for US$5bn or US$4,300/sf
• 13x Price/FFO • Private transactions have had cap rates of 2-3%
• 3.1% dividend yield
• 0.43x Price/Book, near a 10 year low (57% Discount) High barriers to entry
• Hong Kong Island will see virtually no new supply in
Price to Book Ratio coming years
1.2x
• Landlord’s high-quality Central portfolio has only 1%
1.1x
vacancy
1.0x
0.9x Management proactively addressing valuation
0.8x • Enacted first share buyback since 2008, repurchased
Average = 0.66x
0.7x $130m of securities year to date
0.6x • We expect share buybacks to continue if pricing
0.5x dislocation persists
0.4x
Current = 0.43x
0.3x
As of March 31, 2019. Source: Brookfield Public Securities Group LLC and company filings. 1) Valuation example provided for illustrative purposes only . SF: Square feet. FFO: Funds from operations
40Real Estate Universe
Historical Investment Characteristics
• Many lease agreements have contractual increases $1.5 trillion
tied to inflation, leading to generally attractive Total market capitalization
revenues and cash flows
(>400 companies)
• Assets with a history of pricing power—the ability to
pass along rising costs to customers—which has
been beneficial in periods of elevated inflation
• Companies, which are bound by the REIT structure,
are generally required to distribute 90% of income
Healthcare Shopping Centers Industrial Single Family Rental Self Storage
Longer Lease Term Shorter Lease Term
Triple Net Lease Regional Malls Office Multifamily Hotels
As of December 31, 2018. Source: Brookfield Public Securities Group LLC research and estimates
41Is the correlation between REITs and rates a myth?
100%
80%
60%
40%
R2 = 0.10
20%
Global REITs
One Year 0%
Total Return
-20%
-40%
-60%
Positive GDP Growth
-80%
-2.5% -2.0% -1.5% -1.0% -0.5% 0.0% 0.5% 1.0% 1.5% 2.0% 2.5%
Negative GDP Growth
10-Year U.S. Treasury Yield
Year-Over-Year Change
The correlation is very weak; we believe GDP growth is likely a better indicator
As of September 30, 2018. Source: Bloomberg; Brookfield Public Securities Group LLC Reflects trailing 12-month returns and GDP growth for each quarterly observation for the period
12/31/1992- latest. Reflects longest available time period. Global REITs represented by the S&P Developed REIT Index for the period 12/31/1992 through 1/31/2005 and the FTSE
EPRA Nareit Developed Index for the period 2/1/2005 to the latest date.
42Brookfield Global Listed Real Estate Fund Key Holdings
Top Ten
Market Cap Active
Ticker Company Region Sector Weight
(billions) Weight1
VNA.GY Vonovia SE Continental Europe Residential $26.9 4.5% 2.7%
AVB AvalonBay Communities Inc U.S. Residential $27.8 3.8% 2.0%
KRC Kilroy Realty Corp U.S. Office $7.7 3.4% 2.9%
MAA Mid-America Apartment Communities Inc U.S. Residential $12.5 3.3% 2.5%
VTR Ventas Inc U.S. Healthcare $22.8 3.2% 1.8%
PSA Public Storage U.S. Self Storage $38.0 3.0% 0.9%
8802.JP Mitsubishi Estate Co Ltd Japan Office $25.2 2.9% 1.6%
8801.JP Mitsui Fudosan Co Ltd Japan Office $24.9 2.9% 1.4%
MGP MGM Growth Properties LLC U.S. Net Lease $2.9 2.7% 2.7%
SGP Simon Property Group Inc U.S. Retail $56.3 2.6% -1.0%
Total 32.3%
Top Overweight Positions
Market Cap Active
Ticker Company Region Sector Weight
(billions) Weight1
KRC Kilroy Realty Corp U.S. Office $7.7 3.4% 2.9%
VNA.GY Vonovia SE Continental Europe Residential $26.9 4.5% 2.7%
MGP MGM Growth Properties LLC U.S. Net Lease $2.9 2.7% 2.7%
MAA Mid-America Apartment Communities Inc U.S. Residential $12.5 3.3% 2.5%
DOC Physicians Realty Trust U.S. Healthcare $3.4 2.3% 2.1%
As of March 31, 2019. 1. Relative to the FTSE EPRA Nareit securities identified and described do not represent all of the precisely to the total. Performance data quoted represents
Developed Index (Net of WHT). Weights and portfolio securities purchased, sold or recommended for the Fund. past performance, which does not guarantee future
holdings are subject to change. The mention of specific The reader should not assume that an investment in the results. No guarantee that the Fund currently holds any of
securities is not a recommendation or solicitation for any securities identified was or will be profitable. Due to the names referenced herein. See end of this presentation
person to buy, sell or hold any particular security. The rounding, amounts presented herein may not add up for additional disclosures and definitions.
43Brookfield Global Listed Real Estate Fund Performance Summary
(BLRAX, BLRCX, BLRYX)
Performance Summary as of 3/31/19
Inception One Three Five Since
(Net of Fees) Date QTD YTD Year Years
1
Years
1
Inception
1
Brookfield Global Listed Real Estate Fund (Class A – excluding sales charge) 4/30/12 15.16% 15.16% 10.39% 5.79% 6.51% 8.36%
Brookfield Global Listed Real Estate Fund (Class A – including sales charge) 4/30/12 9.67% 9.67% 5.15% 4.08% 5.48% 7.60%
Brookfield Global Listed Real Estate Fund (Class C – excluding sales charge) 4/30/12 14.97% 14.97% 9.52% 5.01% 5.71% 7.55%
Brookfield Global Listed Real Estate Fund (Class C – including sales charge) 4/30/12 13.97% 13.97% 8.52% 5.01% 5.71% 7.55%
Brookfield Global Listed Real Estate Fund (Class Y) 11/30/11 15.29% 15.29% 10.66% 6.06% 6.75% 10.34%
FTSE EPRA Nareit Developed Index (Net of WHT) 14.59% 14.59% 13.27% 5.68% 6.41% 7.30%2
FTSE EPRA Nareit Developed Index (Gross of WHT) 14.86% 14.86% 14.33% 6.67% 7.36% 8.20%2
Performance
Growth of $10,0002 $16,594
$17,000
$16,000
$15,000 $16,277
$14,000
$13,000
$12,000
$11,000
$10,000
$9,000
$8,000
Apr-12 Jan-13 Oct-13 Jul-14 May-15 Feb-16 Nov-16 Sep-17 Jun-18 Mar-19
Brookfield Global Listed Real Estate Fund (Class A – including sales charge) (Net of Fees)
FTSE EPRA Nareit Developed Total Return Index (Net of WHT)
1) Annualized. As of March 31, 2019. or CDSC and if reflected, the sales charge or fee would of the Fund.
2) References Class A’s inception date. reduce the performance quoted. Investment performance The chart illustrates the performance of a hypothetical
3) Relative to Class A – including sales charge against the reflects fee waivers, expenses and reimbursements in $10,000 investment made in the Fund since inception. Results
FTSE EPRA Nareit Developed Index (Net of WHT). effect. In the absence of such waivers, total return and for the Fund are net of management and performance fees.
Performance data quoted represents past performance; NAV would be reduced. Investment performance reflects Represents performance since inception of the Fund:
past performance does not guarantee future results. The fee waivers, expenses and reimbursements in effect. In November 30, 2011 through March 31, 2019. The quoted
investment return and principal value of an investment the absence of such waivers, total return and NAV would benchmarks do not reflect deductions for fees, expenses or
will fluctuate so that an investor’s shares, when be reduced. The gross operating expense ratio for the taxes. Benchmark performance is shown for illustrative
redeemed, may be worth more or less than their original Class A, C, and Y Shares are 1.22%, 1.97%, 0.97%, purposes only and does not predict or depict the performance
cost. Current performance of the Fund may be lower or respectively. The FTSE EPRA Nareit Developed Index is an of any investment. There may be material factors relevant to
higher than the performance quoted. Performance data unmanaged market-capitalization-weighted total-return index, any such comparison such as differences in the volatility, and
current to the most recent month end may be obtained by which consists of publicly traded equity REITs and listed regulatory and legal restrictions between the indices shown
calling 855.244.4859. Performance shown including sales property companies from developed markets. The Index is and the Fund. See end of this presentation for additional
charge reflects the Class A maximum sales charge of unmanaged and, unlike the Fund, is not affected by cash disclosures and definitions.
4.75% and the Class C Contingent Deferred Sales Charge flows, trading and expenses. It is not possible to invest directly
(CDSC) of 1.00%. Performance data excluding sales in an index. Index performance is shown for illustrative 44
charge does not reflect the deduction of the sales charge purposes only and does not predict or depict the performanceBrookfield Global Listed Real Estate Fund
Fund Characteristics
Fund AUM Fund Inception
BLRAX BLRCX BLRYX Benchmark
$1.9 billion Nov-11
Distribution Rate1 3.78% 3.13% 3.99% 4.04%
Concentration in names and themes
30 Day SEC Yield
• Best ideas globally: generally 40 to 70 securities
(subsidized)2 2.36% 1.74% 2.73% --
• Top 10 holdings represent approximately 30% to 40% of
total portfolio 30 Day SEC Yield
(unsubsidized)2 2.35% 1.72% 2.71% --
Individual holdings Weighted Average
• High conviction/large cap 3% to 10% Market Cap $15.8B $15.8B $15.8B $15.6B
• Other 1% to 3%
Number of
Holdings 58 58 58 333
Active weights
Top 10
• Limited underweight positions
Concentration 32.3% 32.3% 32.3% 20.2%
• Typical overweight per position 0.5% or 2.0%
• Target portfolio active share generally ~65% Non-Benchmark
• Benchmarked to the FTSE EPRA Nareit Developed Index Exposure 4.2% 4.2% 4.2% --
(Net of WHT3)
As of March 31, 2019. As of December 31, 2018 the Fund estimates approximately 33.87% of its distributions is a return of capital. Targets are subject to change without notice.
The manager makes no warranty that the targets will be achieved. 1) The distribution rate is calculated as the annualized amount of the most recent quarterly distribution declared
divided by March 31, 2019 Net Asset Value per share. This calculation does not include any non-income items such as loan proceeds or borrowings. The Fund estimates that it
has distributed more than its net investment income and net realized capital gains; therefore, a portion of your distribution may be a return of capital. 2) Class A. As of March 31,
2019, 30 Day SEC Yield does not include income that is determined to be from return of capital. Assets are preliminary and subject to change. 3) Withholding Tax (WHT). Assets
reflect the Brookfield Global Listed Real Estate Fund. Benchmark performance is shown for illustrative purposes only and does not predict or depict the performance of any
investment. There may be material factors relevant to any such comparison such as differences in the volatility, and regulatory and legal restrictions between the indices shown
and the Fund. Past performance is not indicative of future results.
45Disclosures
Must be preceded or accompanied by a current prospectus. by a fund in lower-rated and non-rated securities presents a
greater risk of loss to principal and interest than higher-rated
Mutual fund investing involves risk. Principal loss is possible.
securities. Some securities held may be difficult to sell,
Investing in real estate securities involves different risks,
particularly during times of market turmoil. If a fund is forced
including the loss of principal. The tax treatment of returns of
to sell an illiquid asset to meet redemption, the fund may be
the asset classes listed above may differ given different tax
forced to sell at a loss. Using derivatives exposes a fund to
treatment of income versus capital gain and other factors such
additional risks, may increase the volatility of a fund’s net
as the capital structure of the investment. Unlike bonds, REIT
asset value and may not provide the result intended. Since a
distributions are not fixed and may fluctuate (positively or
fund will invest more than 25% of its total assets in securities
negatively) over time based on market conditions. Moreover,
in the real estate industry, a fund may be subject to greater
the underlying property values of a REIT may increase or
volatility than a fund that is more broadly diversified. Past
decline over time causing the value of the REIT to increase or
performance is no guarantee of future results. Opinions
decline accordingly. Investors in bonds receive a principal
expressed are subject to change at any time, are not guaranteed
payment are par value upon maturity, unless the bond defaults
and should not be considered investment advice.
or is called. Below are real estate related risk disclosures that
apply to Brookfield real estate mutual funds. Property values Diversification does not guarantee a profit or protect from loss in a
may fall due to increasing vacancies or declining rents declining market.
resulting from unanticipated economic, legal, cultural or
Fund holdings and sector allocations are subject to change and are
technological developments. REITs are dependent upon
not recommendations to buy or sell any security. Current and future
management skills and generally may not be diversified. REITs
portfolio holdings are subject to risk.
are subject to heavy cash flow dependency, defaults by
borrowers and self-liquidation . Of course, along with any INDEX PROVIDER DISCLAIMER
benefits realized through the effects of rising inflation, Brookfield Public Securities Group LLC does not own or participate
companies that own and operate real assets will likely in the construction, or day-to-day management of the indices
experience rising operating costs associated with the goods referenced in this document. The index information provided is for
and services they provide. As inflation rises, there is no your information only and does not imply or predict that a Brookfield
assurance that they will have the pricing power to pass along Public Securities Group LLC product will achieve similar results.
such costs to customers. There are also independent factors This information is subject to change without notice.
that could hinder their ability to perform in periods of rising
inflation. For example, unfavorable changes in the regulatory The Indices referenced in this document do not reflect any fees,
environment, rapidly rising interest rates or unforeseen expenses, sales charges, or taxes. It is not possible to invest
imbalances in supply and demand could make it difficult for directly in an index. The index sponsors permit use of their indices
real estate, infrastructure, natural resource, and commodity and related data on an "As Is" basis, makes no warranties regarding
securities to keep pace with inflation. Please see important same, does not guarantee the suitability, quality, accuracy,
disclosures at the end for additional risk considerations.A fund timeliness, and/ or completeness of their index or any data included
may invest in small and mid-cap companies, which involve in, related to, or derived therefrom, assumes no liability in
additional risks such as limited liquidity and greater volatility. connection with the use of the foregoing. The index sponsors have
A fund may invest in foreign securities which involve greater no liability for any direct, indirect, special, incidental, punitive,
volatility and political, economic and currency risks and consequential, or other damages (including loss profits). The index
differences in accounting methods. Investing in emerging sponsors do not sponsor, endorse, or recommend Brookfield Public
markets may entail special risks relating to potential Securities Group LLC or any of its products or services.
economic, political or social instability and the risks of There may be material factors relevant to any such comparison
nationalization, confiscation or the imposition of restrictions such as differences in the volatility, and regulatory and legal
on foreign investment. Debt securities rated below investment restrictions between the indices shown and the strategy.
grade are commonly referred to as “junk bonds” and are
considered speculative. Increases in interest rates can cause
the prices of fixed income securities to decline, and the level
of current income from a portfolio of fixed income securities
may decline in certain interest rate environments. Investment
46Disclosures
INDEX DEFINITIONS DEFINITIONS
The FTSE EPRA Nareit Developed Total Return Index is an FOMC is the Federal Open Market Committee; the monetary
unmanaged market-capitalization-weighted total-return index, which policymaking body of the Federal Reserve System.
consists of publicly traded equity REITs and listed property
Active Share is a measure of the percentage of stock holdings in a
companies from developed markets.
manager's portfolio that differs from the benchmark index.
The FTSE EPRA Nareit Developed Index is calculated by the FTSE
Alpha is a measure of the difference between a fund's actual
Group. Performance is calculated by price, total return and net total
returns and its expected performance, given its level of risk as
return and the Index is calculated daily. Constituents must meet
measured by beta.
minimum market capitalization, liquidity requirements, and real
estate activity requirements in order to be included within the Index. Annualized Return is periodic returns rescaled to a period of one
North American and Asian companies must be of a minimum of year.
US$200 million in market capitalization with liquidity of US$100 Bps = basis points.
million. European companies are bound by €50 million market cap
minimum and liquidity of €25 million. The Net version of the index is Cash flows refer to the amount of cash generated and used by a
calculated net of applicable withholding tax, however does not company over a given period.
reflect deductions for fees, expenses, or other taxes. Consumer Price Index (CPI) is a measure that examines the
The S&P Developed REIT Index serves as a benchmark of publicly weighted average of prices of a basket of consumer goods and
traded equity REITs domiciled in developed markets. services, such as transportation, food and medical care. It is
calculated by taking price changes for each item in the
The NCREIF Fund Index – Open End Diversified Core Equity (NFI- predetermined basket of goods and averaging them.
ODCE) is a capitalization-weighted, gross of fee, time-weighted
return index with an inception date of December 31, 1977. Open- Correlation, in the finance and investment industries, is a statistic
end funds are generally defined as infinite-life vehicles consisting of that measures the degree to which two securities move in relation
multiple investors who have the ability to enter or exit the fund on a to each other. Correlations are used in advanced portfolio
periodic basis, subject to contribution and/or redemption requests, management, computed as the correlation coefficient, which has a
thereby providing a degree of potential value that must fall between -1.0 and +1.0.
The MSCI World Gross Total Return Index is a free float-adjusted Pice-to-book ratio, or P/B ratio, is a financial ratio used to
market-capitalization-weighted index that is designed to measure compare a company's current market price to its book
the equity market performance of developed markets. investment value.
liquidity
R2 is a percentage measure of how often one variable changes
The ICE BofA Merrill Lynch Global Corporate Index is an when another variable changes. In statistical terms, it is a measure
unmanaged, commonly accepted measure of the performance of of how correlated a group of actual observations are to a model’s
global investment grade corporate securities. predictions.
The above-mentioned indexes do not reflect deductions for fees, Standard Deviation measures the degree to which an investment’s
expenses or taxes. The indexes are unmanaged and cannot be return varies from its mean return.
purchased directly by investors. Index performance is shown for
The SEC yield is based on a 30-day period ending on the last day
illustrative purposes only and does not predict or depict the
of the previous month. It is computed by dividing the net investment
performance of any investment.
income per share earned during the period by the maximum
The MSCI US REIT Index is a free float-adjusted market offering price per share on the last day of the period.
capitalization weighted index that is comprised of equity Real Estate
Yield refers to the earnings generated and realized on an
Investment Trusts (REITs).
investment over a particular period of time, and is expressed in
The S&P 500® Index is an unmanaged weighted index of 500 large terms of percentage based on the invested amount or on the
company stocks that is widely-recognized as representative of the current market value or on the face value of the security.
performance of the U.S. stock market. Indexes are not managed
Quasar Distributors, LLC is the distributor of Brookfield Investment
and an investor cannot invest directly in an index.
Funds and Brookfield Public Securities Group LLC is the Investment
Advisor. 47You can also read
