LEG Immobilien AG Company Presentation - November 2019

Page created by Frederick Chen
 
CONTINUE READING
LEG Immobilien AG Company Presentation - November 2019
LEG Immobilien AG

November 2019

Company Presentation
LEG Immobilien AG Company Presentation - November 2019
Disclaimer

While the company has taken all reasonable care to ensure that the facts stated in this presentation are accurate and that
the opinions contained in it are fair and reasonable, this presentation is selective in nature and is intended to provide an
introduction to, and an overview of the Company’s business. Any opinions expressed in this presentation are subject to
change without notice and neither the Company nor any other person is under any obligation to update or keep current the
information contained in this presentation. Where this presentation quotes any information or statistics from any external
sources, you should not interpret that the Company has adopted or endorsed such information or statistics as being
accurate.

This presentation may contain forward-looking statements that are subject to risks and uncertainties, including those
pertaining to the anticipated benefits to be realised from the proposals described herein. Forward-looking statements may
include, in particular, statements about future events, future financial performance, plans, strategies, expectations,
prospects, competitive environment, regulation, and supply and demand. The Company has based these forward-looking
statements on its views and assumptions with respect to future events and financial performance. Actual financial
performance could differ materially from that projected in the forward-looking statements due to the inherent uncertainty of
estimates, forecasts and projections, and financial performance may be better or worse than anticipated. Given these
uncertainties, readers should not put undue reliance on any forward-looking statements. The information contained in this
presentation is subject to change without notice and the Company does not undertake any duty to update the information
and forward-looking statements, and the estimates and assumptions associated with them, except to the extent required by
applicable laws and regulations.

This presentation does not constitute an offer or invitation to purchase or sell any shares in the Company and neither this
presentation or anything in it shall form the basis of, or be relied upon in connection with, any contract or commitment
whatsoever.

2 I   November 2019
LEG Immobilien AG Company Presentation - November 2019
Key Investment Highlights

       c. 3.8% Dividend Yield1) from Stable Residential Cash Flows with Sound Growth Prospects
        Leading cash flow profitability in German residential industry driven by attractive scale effects in our core markets
        Significant potential for stable, above average growth (structural organic + external growth)

       Leading Operating Performance Based on Focused Platform
        Favourable demand/supply and high affordability in NRW basis for structural growth
        NRW stands out with comparatively low political risks
        Strong beneficiary from net immigration (right product in the right region)

       Creating Tangible Value from Acquisitions with High Potential for Synergies
        Acquisition of c. 55,000 units since IPO with immediate value contribution and a very low execution risk
         (FFO per share accretion, no NAV dilution)
        Management expertise in affordable housing and in-depth knowledge with high synergies in core markets as key
         success factors

       Leader in Innovation / Successfully Leveraging Value of Customer Base
        Launched Multimedia, Energy Services and Craftsmen Services businesses as additional earnings drivers

       Strong Balance Sheet / Long Term Secured Financing at Very Attractive Terms
        LTV of 36.3% secures defensive profile
        Average cost of debt of Ø 1.64% with average maturity of c. 7.3 years
        Secures high visibility for future earnings and dividend growth
1)    Based on mid-point guidance 2020, share price as of 8 November 2019 (€100.75)

3 I     November 2019
LEG Immobilien AG Company Presentation - November 2019
Highlights 9M-2019

Overall company development: Delivering on key value drivers
  Acquisitions:                                           Approx. 5,700 units signed (YTD), pipeline of several smaller deals
  Capital growth:                                         Another valuation uplift of around 3% expected in Q4 (~8% in FY-2019)
  Financing:                                              Further reduction of avg. interest costs ahead (early redemptions + acquisitions)

Sound rent momentum persists
  In-place rent, l-f-l                                    €5.82/sqm (+2.9%; free financed units +3.7%)
  EPRA-Vacancy, l-f-l                                     3.6% (unchanged YOY)
  Maintenance/Capex                                       €21.88/sqm (+7.7% YOY)

Financials: Producing compelling total returns
  Net cold rent                                           €439.8m (+5.5% YOY from €417.0m)
  Adjusted EBITDA                                         €330.5m (+8.0% YOY from €305.9m)
  FFO I                                                   €259.1m (+7.0% YOY from €242.2m), FFO per share €4.09 (+6.7% YOY from €3.83)
  Pro forma NAV post conversion1                          €100.52 per share (up from €93.40 in FY-2018; +7.6% YTD/ +11.4% incl. €3.53 DPS)
  DPS-2019 (proposal)                                     €3.60 (rising dividend despite 9.2% higher number of shares)

 1)   NAV after a simulated, executed conversion of the 2014/2021 convertible which was nearly completed at end of Q3-2019

4 I      November 2019
LEG Immobilien AG Company Presentation - November 2019
LEG at a Glance
Leading residential platform across Germany’s largest state

                                       Overview                                                                       Key Financial Metrics 9M-2019
  One of the largest German residential real estate                                               Net Cold Rent                                                  €439.8m
   companies with 130,968 residential units and market
   leader in the NRW market                                                                        Adj. EBITDA                                                    €330.5m
  NRW is one of the largest metropolitan areas in Europe                                          FFO I                                                          €259.1m
   accounting for 21% of German GDP
  Regional focus bears structural competitive advantages                                          GAV                                                            €11,277m
   for operating efficiency and performance
                                                                                                   Pro forma NAV per share1)                                      €100.52
  93% of LEG‘s portfolio is located in the catchment area of
   growth cities such as Cologne, Düsseldorf or Münster                                            LTV                                                             36.3%

                               Key Data (9M-2019)                                                                      Geographic Reach across NRW

     Number of residential units:                                 131,135
     Residential sqm:                                             8.36m
     In-place rent (l-f-l):                                       €5.82 /sqm                                                                           Münster
                                                                                                                                                                       Bielefeld
     EPRA-vacancy (l-f-l):                                        3.6%
     Rent free financed/ restricted units (l-f-l):                €6.20/4.80 /sqm                                                                                Dortmund
     Apartment size:                                              64 sqm                                                               Duisburg         Essen

     Apartments per building:                                     7 units                                                                                Wuppertal
                                                                                                                                        Düsseldorf
     Number of rooms per unit:                                    3 rooms
                                                                                                                                              Cologne
                                                                                                                                                          Bonn

1) Adjusted   for the effects from an executed conversion of the 2014/2021 convertible (adj. EPRA-NAV per share diluted €100.20 (excl. goodwill))

5 I   November 2019
LEG Immobilien AG Company Presentation - November 2019
Agenda

 I.            LEADING OPERATING PERFORMANCE       Leading operating performance and profitability on
                                                   basis of a regionally focused business model

 II.           ATTRACTIVE NRW MARKET               Metropolitan region benefitting from sound growth
                                                   prospects; net immigration as key growth driver

 III.          MARKET LEADING PLATFORM WITH        Proven track record for value accretive acquisitions in
               EXTERNAL GROWTH POTENTIAL           core markets with high synergies

 IV.           INNOVATION & VALUE-ADDED SERVICES   Creating additional value by leveraging value of the
                                                   customer base; aspiration to become a digital leader

 V.            FINANCIALS: HIGH PROFITABILITY –    Sound FFO and dividend growth on basis of leading
               STRONG BALANCE-SHEET                operating profitability and long term secured financing

 VI.           BUSINESS UPDATE & OUTLOOK

6 I     November 2019
LEG Immobilien AG Company Presentation - November 2019
I.          Leading Performance
Strong track record of outperforming German residential market

                       L-f-l in-place rent (€/sqm)                           Successful rent management1) (€)

                                                                                                                    6.65
                                                            5.67                6.12
                                                     5.46
                                             5.34
                                      5.21
                               5.11
                                                                                2012                                2018
                       4.96                                                            Germany in-place rent per sqm
              4.86
      4.79

                                                                                                                    6.03
                                                                                5.11

      2011    2012     2013   2014    2015   2016    2017   2018                2012                                2018
                                                                                LEG in-place rent per sqm unrestricted units

                                                                      LEG‘s affordable living product in urban areas well
       LEG continuously outperformed the broader German
                                                                       suited to market conditions
        residential market
                                                                      Excess demand and high affordability create
       Strong outlook for further growth acceleration
                                                                       headroom for sustained organic growth

                                                                                                             Source: LEG as of FY-2018
                                                                                                             1) Sources: LEG, Bundesbank
                                                                                                             2) Like-for-like

7 I    November 2019
LEG Immobilien AG Company Presentation - November 2019
I.        Leading Performance
Portfolio: Attractive combination of yield and growth

                                                                 High Growth                                      Higher Yielding
  As of 30.09.2019, IFRS 5 excluded                                                            Stable Markets                       Total Portfolio1)
                                                                   Markets                                           Markets
  No. of Units                                                       41,497                              48,313       39,476            131,135

  % of GAV                                                             46%                                32%          21%               100%

  Gross Yield                                                          4.3%                              5.7%          6.5%              5.3%

  EPRA-Vacancy l-f-l                                                   1.9%                              3.6%          6.4%              3.6%

  In-Place Rent CAGR l-f-l
                                                                       2.9%                              2.8%          2.9%              2.9%
  FY-2016 – FY-2018

  Free Financed Portfolio Rent CAGR l-f-l
                                                                       3.9%                              3.7%          3.5%              3.8%
  FY-2016 – FY-2018

               High exposure to attractive economic centers and university cities (e.g. Cologne, Düsseldorf, Münster)
               Higher Yielding markets – attractive cash cows with decent growth profile

Only residential units shown. Total includes an additional 1,849 residential units located outside NRW

8 I    November 2019
LEG Immobilien AG Company Presentation - November 2019
I.          Leading Performance
Positive rent development across all submarkets
                                                                                                     Strong results on the basis of tailor-made
                                                                               Minden-
                                                                               Lübbecke                       management strategies
                                          Steinfurt
                                                                           Herford

                                                                         Bielefeld
                                                                                     Lippe
                                                                                                                         High-Growth Markets
                            Borken              Munster
                                                                  Gütersloh
                                     Coesfeld         Warendorf
                                                                                                                                30.09.2019          (YOY)

          Kleve                                    Hamm                       Paderborn Hoxter
                                                                                                 # of units                      41,497           +0.3%
                   Wesel            Recklinghausen
                              Gelsenkirchen
                        OberhausenHerne Dortmund
                                                Unna         Soest
                                                                                                 In-place rent (sqm), l-f-l      €6.51            +3.3%
                                   Bochum
                       DuisburgEssen
                                            Hagen Hochsauerlandkreis
                                                                                                 EPRA-Vacancy, l-f-l             1.9%             -50 bps
                 Krefeld
          Viersen         Mettmann
                     Düsseldorf Wuppertal Märkischer Kreis
          Monchengladbach        Remscheid
                  Rhein-Kreis
                             Solingen                                                                                         Stable Markets
                    Neuss                                 Olpe
       Heinsberg             Leverkusen
                                                                                                                                                    (YOY)
                       Rheinisch-Bergischer Kreis
                              Cologne
                                              Oberberg.   Siegen-
                                                          Wittgenstein
                                                                                                                                30.09.2019
                   Rhein-Erft-Kreis           Kreis
               Düren              Rhein-Sieg-Kreis                                               # of units                     48,313            +1.6%
         Aachen
                                 Bonn
                                                                                                 In-place rent (sqm), l-f-l     €5.47             +3.0%
                   Euskirchen                                                                    EPRA-Vacancy, l-f-l            3.6%              +20 bps

                                         Total Portfolio1                                                               Higher-Yielding Markets
                                                30.09.2019                             (YOY)                                   30.09.2019          (YOY)
 # of units                                     131,135                              +0.7%       # of units                     39,476            +0.2%
  In-place rent (sqm), l-f-l                    €5.82                                +2.9%       In-place rent (sqm), l-f-l     €5.39             +2.2%
  EPRA-Vacancy, l-f-l                           3.6%                                 0 bps       EPRA-Vacancy, l-f-l            6.4%              +60 bps
 1)   IAS 40 only, IFRS 5 excluded

9 I      November 2019
LEG Immobilien AG Company Presentation - November 2019
I.         Leading Performance
  Well diversified portfolio with attractive reversionary potential

                   High Growth Markets                                                                                                                                             Stable Markets
     As of 9M-2019                          LEG            NRW2                                    NORTH RHINE-
                                                                                                    WESTPHALIA                                                  As of 9M-2019                LEG       NRW2
     No. of Residential Units               41,497         4,139,973
                                                                                                                                                                No. of Residential Units     48,313   2,922,288
     Occupancy Rate (%)                     98.2%            97.3%
                                                                                                                                           Minden-              Occupancy Rate (%)           96.4%     96.9%
                                                                                                                                           Lübbecke
     In-Place Rent per sqm (€)               6.51             7.59                               Steinfurt                                                      In-Place Rent per sqm (€)     5.47      5.98
                                                                                                                                        Herford
     Rent Potential1)                        17%                 n/a
                                                                                                                                                                Rent Potential1)              9%         n/a
                                                                                                                                  Bielefeld
                                                                                                                                              Lippe
                                                                                  Borken              Munster
                                                                                                                            Gütersloh
                                                                                           Coesfeld             Warendorf

                                                         Kleve                                          Hamm                               Paderborn   Hoxter
                                                                       Wesel             Recklinghausen
     The LEG                                                                      Gelsenkirchen
                                                                                                      Unna             Soest
                                                                            Oberhausen Herne Dortmund
     portfolio offers a                                                   Duisburg Essen
                                                                                        Bochum

     11% average rent                                                                                   Hagen
                                                                                                                                                                           Higher Yielding Markets
                                                                     Krefeld
     upside potential1                                     Viersen         Mettmann                         Hochsauerlandkreis
                                                                     Dusseldorf Wuppertal      Märkischer Kreis
                                                                                                                                                                 As of 9M-2019                LEG      NRW2
                                                           Monchengladbach         Remscheid
                                                                              Solingen
                                                                  Rhein-Kreis
                                                                  Neuss                                     Olpe                                                 No. of Residential Units    39,476   1,910,513
                                                      Heinsberg             Leverkusen
                                                                      Rheinisch-Bergischer Kreis
                                                                                               Oberbergischer Siegen-
                                                                            Cologne            Kreis                                                             Occupancy Rate (%)          93.8%     96.0%
                                                                 Rhein-Erft-Kreis                             Wittgenstein
                                                                 Düren
                                                        Aachen
                                                                                           Rhein-Sieg-Kreis                                                      In-Place Rent per sqm (€)    5.39      5.72
                                                                                       Bonn
                                                                                                                                                                 Rent Potential1)             6%         n/a
                                                                     Euskirchen

Source: LEG as of 9M-2019, CBRE, Empirica, IT.NRW
1) Market rent (CBRE) compared to LEG portfolio
2) No. of residential units as of 2017, occupancy rate as of 2018

  10 I       November 2019
I.      Leading Performance
Attractive portfolio + operational excellence = strong rent growth

              L-f-l residential rent (€/sqm/month)                               Rent growth drivers

                              +2.9%                                     +3.3%
                                                                         0.2%             +3.0%      Cost rent adjustments

                                                                         0.6%
                                          5.82
                       5.65                                                                0.7%      Re-letting

                                                                         0.6%
                   Q3-2018               Q3-2019
                                                                                           0.8%      Modernisation
            L-f-l free financed rent (€/sqm/month)

                              +3.7%                                                                  Mietspiegel
                                                                         1.9%              1.5%
                                                                                                     adjustments

                                          6.20
                       5.98

                                                                       FY-2017           FY-2018
                   Q3-2018              Q3-2019
                                                                  Well diversified mix of growth drivers (low
    Performance of free financed units demonstrates strong        execution risk)
     underlying fundamentals                                      Growth not boosted by overspending (capex)
    Rent restricted units: +0.5% year-on-year (like-for-like)     though supported by modernization program
    High exposure to structural growth markets and respective    Effects from capex are now partially included in
     commuter belts supports outperformance                        the re-letting cluster

11 I   November 2019
Capex & Maintenance
Lifting internal growth potential

  Lifting growth potential while maintaining high capital efficiency

                                          €194.9m            • Investments increased 11.8% year-over-year
                  €174.4m              (€21.88/sqm1)
               (€20.32/sqm1)                                 • Excess demand creates headroom for rent increases
                 €120.3m                 €136.5m             • Leading capital efficiency as key value driver (rent growth relative to
                                                               capital expenditure)
                  €54.1m                 €58.4m              • Target return of c. 6% on modernisation projects (IRR)
                  9M-2018                9M-2019
                                                             • Enhanced capex programme ongoing
                         Maintenance    Capex

  Rising capital expenditure leads to portfolio valuation upside and FFO accretion

in €/sqm:           13.8                 16.1           18.2                  22.4        29.4            ~30-32          ~31-33

                                                                                                         270-280          280-290
in €m:                                                                                    252.7

                                                                             187.5
                                                       149.6                                               200              200
                                                                                           179
                                         114.2                               116
                    89.1                                78
                                          60
                    43
                                                        72                    72           74               80              80
                    46                    54

                  2014                   2015          2016                  2017         2018            2019             2020
1Development
                                                               maintenance            capex
               excluded.

12 I   November 2019
I.      Leading Performance
Unlocking value potential through construction on own land

                                Münster
 • Four buildings with 51 units in Münster: seizing value potential
   through densification on vacant plots of own land
 • Construction cost €7.7m or c.€2,200/sqm; IPR c.€12-13/sqm
 • Respecting the environment and responding to demographic
   changes

                         Cologne (Höhenhaus)                          www.leg-wohnen.de/Gartensiedlung

  • 43 buildings with c. 200 units will be replaced by 400 units
  • First architectural draft expected end of 2019
  • Approx. 30% of apartments will be subsidised or price-
    demanded units, resulting in varying levels of in-place rent
  • Will include a kindergarten and be responsive to aging tenants

                       Hilden (Greater Düsseldorf)
  • Construction of 3 buildings with 38 apartments (completion by
    spring/summer 2020)

                             Total pipeline
                                                                              New construction in Hilden
 • Total pipeline of c.1,000 units, yield on cost >4.5%
 • Target: 500 new build units per year from 2023

13 I   November 2019
Agenda

 I.           LEADING OPERATING PERFORMANCE     Leading operating performance and profitability on
                                                basis of a regionally focused business model

 II.          ATTRACTIVE NRW MARKET             Metropolitan region benefitting from sound growth
                                                prospects; net immigration as key growth driver

 III.         MARKET LEADING PLATFORM WITH      Proven track record for value accretive acquisitions in
              EXTERNAL GROWTH POTENTIAL         core markets with high synergies

 IV.          INNOVATIVE VALUE-ADDED SERVICES   Creating additional value by leveraging value of the
                                                customer base

 V.           FINANCIALS: LEADING CASH FLOW     Sound FFO and dividend growth on basis of leading
              PROFITABILITY – STRONG BALANCE-   operating profitability and long term secured financing
              SHEET

 VI.          BUSINESS UPDATE & OUTLOOK

14 I    November 2019
II.        Attractive NRW Market
NRW: economic engine in Germany with liquid labour market

                                         Key facts                               Large German corporates based in NRW

     Key metropolitan area in Germany, and one of the
      largest areas in Europe (17.9m inhabitants)

     Largest economy: Germany in Europe, NRW in                                                                                  Bielefeld

      Germany                                                                                                                 Gütersloh

                                                                                                                          Essen
     Germany’s economic powerhouse generating approx.                                              Mulheim/Ruhr
                                                                                                                     Düsseldorf
      21% of German GDP
                                                                                                                           Leverkusen
                                                                                                                   Cologne
     About one third of the largest companies in Germany                                                          Bonn
      are based in NRW (10 of the DAX30 companies and 8
      of Germany’s 30 largest companies by revenue in
      2017/18)

     Centrally located in Europe, excellent infrastructure and                        Decreasing unemployment in NRW
      a key transport hub (with multiple airports, dense
      railway system, motorway network and waterways)             12%   11.4%
                                                                  11%
     Robust labour market with decreasing rate of                10%           9.5%
      unemployment (-40% since 2006)                                                      8.9%
                                                                  9%                             8.7%              8.3%
                                                                                                                           7.8% 7.7%
                                                                  8%               8.5%
     Highest population density – key advantage for                                               8.1% 8.1%                                     7.0%
                                                                  7%                                                                      7.4%          6.4% 6.5%
      efficient property management
                                                                  6%
                                                                        2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
                                                                                                     unemployment rate                   May

Source: Federal Statistical Office, Federal Employment Agency

15 I     November 2019
II.        Attractive NRW Market
Portfolio highly exposed to structural growth markets

           Geographic reach of growth cities (60 km radius)                                                                                                 Key data

                                                                                                                      Approx. 93% of LEG‘s portfolio is located in the catchment
                                                                                                                       area of growth cities (60 km) and around 64% in the
                                                                                              Minden-                  commuter belts (60 km) of Düsseldorf and Cologne, the
                                                                                              Lübbecke

                                                      Steinfurt
                                                                                                                       most populous cities in NRW
                                                                                          Herford
                                                                                                                      Many principal university cities are located in NRW, e.g.
                                                           Münster
                                                                                        Bielefeld
                                                                                                    Lippe              Cologne, one of Germany’s “Universities of Excellence” or
                                    Borken

                                               Coesfeld                         Gütersloh                              Bonn, Aachen and Münster
                                                                  Warendorf

                                                                                              Paderborn     Höxter
           Kleve                                         Hamm
                       Wesel              Recklinghausen
                                                       Unna
                                   Gelsenkirchen
                             Oberhausen Herne Dortmund
                                                                             Soest                                                                   Structural growth cities
                                         Bochum
                           Duisburg Essen

                       Krefeld                               Hagen                                                     Number of 1-2 person households constantly growing in
             Viersen            Mettmann
                                                                          Hochsauerlandkreis
                            Düsseldorf Wuppertal          Märkischer Kreis                                              swarm cities and outperforming Germany (2017: 75.3% in
       Mönchengladbach           Solingen
                     Rhein-Kreis
                                                                      Olpe
                                                                                                                        Germany)
                     Neuss      Leverkusen
        Heinsberg
                                   Cologne                Oberbergischer Siegen-                                       Growth cities tend to younger age structure compared
                                                          Kreis          Wittgenstein
                       Rhein-Erft-Kreis
                                                                                                                        to Germany: stronger increase in share of people under the
                   Düren
                                             Rhein-Sieg-Kreis
        Aachen                                                                                                          age of 40 (2017: 43.0 % in Germany) and percentage of
                                        Bonn
                                                                                                                        people above the age of 60 steadily shrinking (2017: 27.9%
                       Euskirchen                                                                                       in Germany; rising trend)

                                                                                                                     Source: Federal Statistical Office

16 I      November 2019
II.         Attractive NRW Market
NRW: leading position in future industries

                                               Highlights                                                                           Key markets showing sound household growth1)
  •    Direct investments: #1 in Germany for foreign investors
       • 29.2% of direct investments in Germany                                                                               Germany
                                                                                                                              Inhabitants +2.6%
                                                                                                                                                                                                Inhabitants +3.1%
                                                                                                                              Households +3.7%
  •    Chemicals: #1 in Germany, #5 in Europe (sales)                                                                                                                                           Households +7.1%
       • NRW generates 30.8% of German sales
                                                                                                                                                  Inhabitants +2.5%
                                                                                                                                                  Households +0.7%
  •    Biotechnology: #1 in Europe, #9 worldwide (patents)
       • Highest number of biotech patent applications in Europe
       • NRW generates 44.4% of German sales
                                                                                                                             Inhabitants +4.0%
                                                                                                                             Households +3.7%
  •    Microsystems Technology: top position
                                                                                                                                                                                              Gütersloh
       • 28% of all German players are located in NRW with focuses in                                                                                                                         1,448 units
          Aachen, Cologne/Bonn, Münster, and Dortmund as a hotspot

  •    Nanotechnology: top position in Germany and Europe                                                                                                                  Dortmund
       • More than 200 companies, thereof 50 large companies                                                                                                              13,596 units
       • 220 institutes (of which 9 Fraunhofer, 3 Max Planck and
         universities)                                                                                                                                    Düsseldorf
                                                                                                                                                          5,307 units
                                                                                                                                             Mönchengladbach
                                                                                                                                                6,444 units
  •    Mobile communication: #1 in Germany
       • NRW companies account for 83% of the German mobile                                                                                                      Cologne
                                                                                                                                                                3,898 units
         communication market
                                                                                                                                                                                                      Inhabitants +6.1%
                                                                                                                                                                       Bonn                           Households +5.3%
  •    Education: 6 of 10 largest universities located in NRW 2)                                                                      Inhabitants +2.4%             2,283 units
                                                                                                                                      Households +1.6%
       • e.g. RWTH Aachen, one of the largest technical universities in
                                                                                                                                                                                         Inhabitants +4.7%
         Europe, renowned for engineering, IT and natural sciences                                                                                                                       Households +1.9%
1) Federal Statistical Office, 2016 vs. 2011
2) Cologne, Aachen, Münster, Bochum, Duisburg/Essen, Bonn. Measured by number of registered students. Source: Federal Statistical Office, winter term 2018/19

17 I      November 2019
II.         Attractive NRW Market
NRW: high quality of life in the Rhine area

                      NRW’s capital Düsseldorf, international trade and business hub                                                                                   Münster
                                                                                                                                                                                       Belefeld

 • Ranked #6 worldwide in Mercer Quality of Living Ranking 2018 especially for its                                                                      Duisburg          Essen
                                                                                                                                                                                  Dortmund

   good infrastructure and its vast offering for cultural and leisure activities. Its excellent                                                     Düsseldorf            Wuppertal

   medical care, vibrant art scene and fashion industry represent other benefits.                                                                            Cologne
                                                                                                                                                                          Bonn

 • Ranked #18 worldwide in Monocle Quality of Life Survey 2018 especially for its
   excellent infrastructure (road, rail, air) and vast opportunities for leisure activities and                                                     Düsseldorf                        2014-2040
   shopping. According to Monocle, Düsseldorf is a rare combination of a local community                                                            Population                           +10.6 %
   and an enthusiastic cosmopolitan city.
                                                                                                                                                    Households                            +15.5%
 • Düsseldorf offers an international airport, a well-known trade fair and is home to                                                               Düsseldorf                                    2016
   companies such as Henkel, Metro, Ceconomy, Uniper or Gerresheimer.
                                                                                                                                                    Population                           613,230
 • The city is a hub for international businesses with 5,000 German or European                                                                     Vacancy1)                                 1.5%
   headquarters, especially from Japan and multiple telecommunication firms such as                                                                 Asking rent1)                 10.00 €/sqm
   Vodafone or Ericsson.

 • Many consultancies have their German headquarters                                                               Düsseldorf Medienhafen:
   (e.g. McKinsey, A.T. Kearney, Booz Allen Hamilton) or                                                           Architecture by Frank Gehry,
   large offices in Düsseldorf                                                                                     first-class restaurants and
                                                                                                                   various offices occupied by
                                                                                                                   media and consulting turned
                                                                                                                   this former harbor area into a
                                                                                                                   city hotspot.
1) Market vacancy and market asking rent 2) According to Wirtschaftswoche and ImmobilienScout24   Photo credits: Michael Gaida                                     Source: LEG Housing market report

18 I      November 2019
II.        Attractive NRW Market
NRW: successful structural change of the Ruhr area

                                           Example 1: Dortmund                                                            Münster
                                                                                                                                         Belefeld

  The former center of the mining and steel industry has developed into an innovative and
                                                                                                                                    Dortmund
  future oriented science and technology city:                                                             Duisburg
                                                                                                                           Essen

                                                                                                          Düsseldorf        Wuppertal

  • It has become a top location for future oriented sectors e.g.,                                              Cologne
                                                                                                                            Bonn

    biotechnology/biomedicine, energy efficiency technology, production technology, IT. Its
    microsystems technology cluster is the largest in Germany and one of the largest in
                                                                                                    Dortmund                            2014-2040
    Europe. 900 logistics companies with 27,000 employees benefit from the good
    infrastructure.                                                                                 Population                                +5.1%
                                                                                                    Households                                +6.5%
  • Excels in scientific research (e.g., Max Planck Institute of Molecular Physiology
    (MPI) as one of the world’s leading institutions or Dortmund’s Fraunhofer Institut for          Dortmund                                        2016
    Material Flow and Logistics as Europe’s top institute for logistics solutions). The             Population                             585,813
    science and technology campus in Dortmund includes 16 faculties and >33,000
    students as well as the technology center with c.350 companies and c.10,000                     Vacancy1)                                   2.5%
    employees in the areas of IT, logistics, microsystems, nanotechnology, production               Asking rent1)                       6.15 €/sqm
    technology.

  The Phoenix lake is one of Germany’s largest urban development
  projects on a former blast furnace and steel production site offering
  a vast recreational area for water sports and leisure, premium
  residential units, commercial units, offices and a marina with
  restaurants.

1) Market vacancy and market asking rent                                                      Source: LEG Housing market report Photo credits: evgenIT

19 I     November 2019
II.        Attractive NRW Market
NRW: successful structural change of the Ruhr area

                                           Example 2: Essen                                                              Münster
                                                                                                                                        Belefeld

  The former coal mining and steel city (Krupp) has developed into an important business,                                          Dortmund
  service and trade center:                                                                               Duisburg
                                                                                                                          Essen
                                                                                                         Düsseldorf        Wuppertal

  • 8 of the 100 largest German companies (by sales) are headquartered in Essen                                Cologne
                                                                                                                           Bonn

    (e.g. E.ON, RWE, Thyssenkrupp, Aldi Nord, Schenker, Evonik, Brenntag, Hochtief);
    also c.13,000 small and medium sized companies.
                                                                                                      Essen                            2015-2040

  • The industrial focus is on future-oriented industries. Essen is one of Germany’s top              Population                             +3.4%
    locations for energy (RWE, E.ON and many small/medium-sized companies), for                       Households                             +4.4%
    healthcare, medical research and health management as well as for environment
    and water management and an important center for creative businesses.                             Essen                                        2016
                                                                                                      Population                          583,084
  • Research from the University of Duisburg-Essen is highly regarded (in particular
    biomedicine, nanotechnology, urban development). As a specialist centre for medical               Vacancy1)                                3.4%
    provision it employs top-class doctors in nearly every specialty 40,000 jobs in the               Asking rent1)                    6.07 €/sqm
    health services industry and.
  • The European Commission has
    awarded Essen “The European                       Zollverein UNESCO World Heritage Site:
    Green Capital 2017” thanks to its                 More than 25 years after its closure, the
    successful transformation from a                  once largest colliery in Europe combines
    coal and steel city to the greenest               culture and dining, design and architecture,
    city in NRW.                                      handicraft and the creative industry – as the
                                                      only World Heritage Site of the Ruhr Area.
1) Market vacancy and market asking rent                                                                              Source: LEG Housing market report

20 I     November 2019
II.          Attractive NRW Market
Positive demographics with stabilising net immigration

  Cities entering upswing mode                                                                                                                              Key facts
  Index = 1975                                                                                                                Federal Agency of Migration and Refugees collected data
                                               End of declining population
110                                                                                                                            that net immigration of foreigners to Germany amounted
                                                                                                  Bielefeld
                                                                                      0.4%
105                                                                                                                            to about 0.4 million in 2018, thereof 0.26 million
                                                                                                  Mönchen-
                                                                                      0.5%        gladbach                     non-EU nationals 6)
100
                                                                                      0.4%        Krefeld                     End of 2017, 1.4 million people seeking protection (incl.
 95
                                                                                                                               asylum seekers) were registered in Germany, the majority
 90                                                                                   0.5%        Dortmund
                                                                                                                               living in NRW (30%) 4)
 85                                                                                   0.6%        Essen
                                                                                                                              Stabilising net immigration is currently continuing with
 80
                                                                                                                               decreasing share of refugees (c. -17% asylum seekers
   1975 1980 1985 1990 1995 2000 2005 2010 2015
                                                                                        CAGR 2011 - 2016                       2018 YOY; c. 0.18 million new asylum seekers in 2018)5)
                                                                                                                              Immigration is driving overall population growth,
                             Net immigration to Germany
                                                                                                                               triggering additional growth in net new households
   ~1.0 m 1)
(c. +80% yoy)
                                                                                                                              Additional pressure on affordable housing segment due
                                                                                                                               to immigrants leaving temporary housing
       NRW             ~25%                                                                       0.8 m 3)
                                                                                                                              Outperformance of German economy attracts qualified
                             0.5 m 2)            ~0.42 m 6)                0.4 m 6)                                            new immigration
                                                                                                                              Liquid labour market and affordable living as pull-factors
       2015                   2016                   2017                   2018               2019-2020
                                                                                                                               for NRW
Sources:
1)    Interview with director of Federal Agency of Migration and Refugees (Aug 2016)
2)    Federal Statistical Office, press release 13 Mar 2018
3)    Deutsche Bundesbank, Monthly Report June 2018
4)    https://www.welt.de/politik/deutschland/article178141460/Migration-nach-Europa-In-NRW-leben-mehr-Asylzuwanderer-als-in-ganz-Italien.html, June 2018
5)    Bundesamt für Migration und Flüchtlinge, August 2019
6)    Federal Statistical Office, press release 16 July 2019

21 I      November 2019
II.       Attractive NRW Market
 NRW cities still showing decent upside potential
                                                                                                                                            Purchasing power1) / household
                                                                                                                                            Gross rent / household
              34.6%                             29.3%                                                                              %        Gross rent ratio

                                                                                24.9%
                                                                                                   23.6%                                                              23.3%
EUR        4,644
                                                                                                                                    21.7%
                                                                          4,138
                                                                                                                                                                3,910
                                                                                                                              3,602
                                                                                                3,371
                                          3,262

                      1,605

                                                       956                              1,031
                                                                                                                                                                              910
                                                                                                           796                              781

               Munich                           Berlin                      Dusseldorf           Dortmund                           Essen                              NRW

 Source: Own calculations based on Empirica (2018), IT:NRW (2017), MB Research (2018)             1) Net income pre tax and social insurance contributions and including received transfer payments

 22 I     November 2019
Agenda

 I.           LEADING OPERATING PERFORMANCE       Leading operating performance and profitability on
                                                  basis of a regionally focused business model

 II.          ATTRACTIVE NRW MARKET               Metropolitan region benefitting from sound growth
                                                  prospects; net immigration as key growth driver

 III.         MARKET LEADING PLATFORM WITH        Proven track record for value accretive acquisitions in
              EXTERNAL GROWTH POTENTIAL           core markets with high synergies

 IV.          INNOVATION & VALUE-ADDED SERVICES   Creating additional value by leveraging value of the
                                                  customer base; aspiration to become a digital leader

 V.           FINANCIALS: HIGH PROFITABILITY –    Sound FFO and dividend growth on basis of leading
              STRONG BALANCE-SHEET                operating profitability and long term secured financing

 VI.          BUSINESS UPDATE & OUTLOOK

23 I    November 2019
III.   Market Leading Platform with External Growth Potential
Strong acquisition track record since IPO – Creating tangible value

 Portfolio growth set to continue in 2019
                                             Approx. 5,700 units signed in 2019 in a challenging market environment,
                                              thereof 1,400 in Lower Saxony and 1,160 in Bremen
                                             Average initial FFO yield of > 5%
                                             Pipeline of several predominantly smaller deals

 Portfolio development since IPO (in units)                                  Attractive initial yields + operational improvements +
                                                                                                      low risk
                           ~46,000               ~ 137,000                                           = Creation of tangible value

          90,926                                                          • Portfolio1): average in-place rents c. +13% (average 48
                                                                            months, CAGR of 3.2%), vacancy down by 60 bp

                                                                                         Lifting attractive value potential also in Stable and
                                                                                         Higher Yielding markets

          2012           Acquisitions             11/2019
                       (net of disposals)
                                                                     1) Acquisitions   since year end 2012; excl. acquisitions in 2019

24 I   November 2019
III.    Market Leading Platform with External Growth Potential
Scalability of platform + cost discipline support value accretive growth

 Strong volume growth at overhead cost below FY-2013 level…

     Recurr.
 admin costs                                                                                    # of units
                                   33.1         36.7               32.1
                           35.2                                                33.3    34.0
       €35m                                                                                     150,000

                                                                                                100,000

                                                                  128,488   130,085   133,969
                                                                                                50,000
                                  106,961      108,916
                     94,311

                         2013      2014         2015               2016      2017      2018

 …leads to a significant drop of the administrative costs ratio

     Recurr.
admin costs/
net cold rent                                                                                   Net cold rent

       12 %              9.8%                                                                   €500m

                                     8.5%        8.4%                                  560.2
        9%                                                                    534.7
                                                                   511.7

        6%                                       436.1
                                                                   6.3%       6.2%      6.1%
                         360.5      390.1
                                                                                                €350m
                         2013      2014         2015               2016      2017      2018

25 I     November 2019
Agenda

 I.           LEADING OPERATING PERFORMANCE       Leading operating performance and profitability on
                                                  basis of a regionally focused business model

 II.          ATTRACTIVE NRW MARKET               Metropolitan region benefitting from sound growth
                                                  prospects; net immigration as key growth driver

 III.         MARKET LEADING PLATFORM WITH        Proven track record for value accretive acquisitions in
              EXTERNAL GROWTH POTENTIAL           core markets with high synergies

 IV.          INNOVATION & VALUE-ADDED SERVICES   Creating additional value by leveraging value of the
                                                  customer base; aspiration to become a digital leader

 V.           FINANCIALS: HIGH PROFITABILITY –    Sound FFO and dividend growth on basis of leading
              STRONG BALANCE-SHEET                operating profitability and long term secured financing

 VI.          BUSINESS UPDATE & OUTLOOK

26 I    November 2019
IV.      Innovation & Value-Added Services
Leveraging LEG‘s strong customer base with additional services

                Partner                          Partner                     Partner                             Partner

                Cooperation                 Joint venture (51%)        Joint venture (51%)              • Elderly care services
       • Multimedia: TV,                 • Electricity, heating,    • Small repair work,                • Emergency call
         internet and telephone            metering                   craftsmen services                  system

         Launch January 2014               Launch March 2015          Launch January 2017               Pilot launch in 09-2018

                     FFO contribution – Services                   Growth drivers
                                                                    Increasing penetration rate & portfolio growth
                                                           €19m
                                                 €16m
                                                                    New services & third party business
                                         €15m
                                                                    Price adjustments

                                  €9m                              Principles
                          €6.8m                                     Additional cash flow streams at low risk
                 €4.6m                                              Stay focused:     • selective extension of value chain
                                                                                       • complementary to letting business
        €0.0m
                                                                    Value add for tenants and shareholders
       2013      2014     2015    2016   2017    2018      2019E

27 I     November 2019
IV.     Innovation & Value-Added Services
Digitization
Digitization as a technology trend is of tremendous importance for the real estate industry and LEG is headed
towards a leading position as a driver of innovation.

       Greatest digital achievements
       • Accounting Robot in Receivables Management increases
         customer satisfaction as employees focus on customer need
         instead of repetitive bookkeeping-tasks
       • Success with tenant app, additional 50% active users
         convinced by extended self-services
       • Streamlining internal processes in maintenance and
         repair to reduce costs

       Current development

       • Substituting written form by phone service to increase
         customer satisfaction
       • No more phone queues as we call our customers back on
         demand                                                           LEG’s Innovation management approach
       • Monitoring water quality in our apartment houses con-
         tinuously and automatically through IoT increasing tenant        Internal scope                External scope
         safety and reducing costs

       Digitization in the long run                                  • Corporate culture          • Innovative services and
                                                                       supporting constant          business models
       • Further automation of processes                               development / innovation   • Extensive network
       • Development of ecosystems with strategic partners to
         increase customer satisfaction and retention                • State-of-the-art processes • Alliances and strategic
       • Development of value-add services (disruptive topics)       • Collaboration and            partnerships
                                                                       communication              • Transferable innovations and
                                                                                                   best practices

28 I    November 2019
Agenda

 I.           LEADING OPERATING PERFORMANCE       Leading operating performance and profitability on
                                                  basis of a regionally focused business model

 II.          ATTRACTIVE NRW MARKET               Metropolitan region benefitting from sound growth
                                                  prospects; net immigration as key growth driver

 III.         MARKET LEADING PLATFORM WITH        Proven track record for value accretive acquisitions in
              EXTERNAL GROWTH POTENTIAL           core markets with high synergies

 IV.          INNOVATION & VALUE-ADDED SERVICES   Creating additional value by leveraging value of the
                                                  customer base; aspiration to become a digital leader

 V.           FINANCIALS: HIGH PROFITABILITY –    Sound FFO and dividend growth on basis of leading
              STRONG BALANCE-SHEET                operating profitability and long term secured financing

 VI.          BUSINESS UPDATE & OUTLOOK

29 I    November 2019
V.    Financials: High Profitability
Financial Highlights 9M-2019

           Net Cold Rent (€m)            Adj. Net Rental and Lease Income (€m)                  Adj. EBITDA (€m)

                       +5.5%
                                                         +7.9%
                                                                                                        +8.0%

         417.0                  439.8                              350.1
                                              324.4                                          305.9                   330.5

       9M-2018                 9M-2019      9M-2018               9M-2019                   9M-2018                9M-2019

                 FFO I (€m)              Capex-Adj. FFO I / AFFO (€m)                                Margin (%)
                                                                                            9M-2018 9M-2019          Comment
                       +7.0%                                                                                       Ongoing efficiency
                                                                                 Adj. NRI     77.8       79.6       gains offsetting
                                                                                                                  higher maintenance
                                                       0.6%                                                          See above +
                                                                                 Adj.
                                                                                              73.4       75.1      decreasing admin.
                                                                                 EBITDA                                  costs
                                259.1
         242.2                                                                                                    See above + lower
                                                                                 FFO I        58.1       58.9
                                                                                                                    interest ratio
                                            121.9                 122.6
                                                                                                                  See above + higher
                                                                                 AFFO         29.2       27.9
                                                                                                                  growth investments
       9M-2018                 9M-2019     9M-2018               9M-2019

30 I   November 2019
V.    Financials: High Profitability
Income statement 9M-2019

 € million                                               9M-2019    9M-2018

 Net rental and lease income                                340.2      315.2    Higher net cold rents (+€22.8m
                                                                                 YOY/+5.5%)
 Net income from the disposal of investment property         -0.8       -0.7

 Net income from the valuation of investment property       551.6      383.5
                                                                                Revaluation gains of 5.1%

 Net income from the disposal of real estate inventory       -2.0       -1.5

 Net income from other services                               1.5        3.8
                                                                                Admin. costs contain one-off
                                                                                 effects e.g. severance
 Administrative and other expenses                          -38.0      -31.7     payments, higher
                                                                                 depreciation due to the
                                                                                 adoption of IFRS 16
 Other income                                                 0.4        0.6

 Operating earnings                                         852.9      669.2    Net income from fair value
                                                                                 measurement of derivatives
                                                                                 -€92.6m; thereof -€91.3m from
 Net finance costs                                         -182.0     -117.9
                                                                                 convertibles
                                                                                 (9M-2018: -€49.6m)
 Earnings before income taxes                               670.9      551.3    Stable cash interests (€58.4m;
                                                                                  -€0.4m YOY) despite rising
                                                                                 debt volume
 Income tax expenses                                       -182.0     -143.6

                                                                                Cash taxes (-€12.9m); lower
 Consolidated net profit                                    488.9      407.7     expenses for FY 2019
                                                                                 expected

31 I   November 2019
V.      Financials: High Profitability
FFO calculation 9M-2019

 € million                                            9M-2019   9M-2018
 Net cold rent                                         439.8     417.0     +€22.8m/+5.5%

 Profit from operating expenses                         -0.9      -3.3
 Maintenance (externally-procured services)            -36.9     -37.6
 Staff costs                                           -48.8     -45.2     Growth in staff costs mainly due
                                                                            to additional FTE’s for crafts
 Allowances on rent receivables                         -5.8      -4.1      services and enhanced capex
 Other                                                  -0.3      -7.0      programme

 Non-recurring project costs (rental and lease)         2.9       4.7      Adj. NRI increased by +€25.5m
 Recurring net rental and lease income                 350.0     324.5      YOY (+7.9%); rising
                                                                            maintenance costs/inflation
 Recurring net income from other services               3.4       5.6       more than offset by efficiency
 Staff costs                                           -24.4     -19.6      gains

 Non-staff operating costs                             -10.9     -10.9
                                                                           Rising staff costs only due to
 Non-recurring project costs (admin.)                  12.0       5.8       one-time effects (severance
                                                                            payments c. €8m)
 Recurring administrative expenses                     -23.3     -24.7
 Other income and expenses                              0.4       0.5
                                                                           EBITDA increased by +€24.6m
 Adjusted EBITDA                                       330.5     305.9      YOY (+8.0%); recurring admin.
 Cash interest expenses and income                     -58.4     -58.8      costs slightly decreased

 Cash income taxes from rental and lease               -10.0      -4.1
                                                                           Stable interest expenses (avg.
 FFO I (including non-controlling interests)           262.1     243.0
                                                                            1.63% vs. 1.71% in 9M-2018)
 Non-controlling interests                              -3.0      -0.8      despite rising debt volume
 FFO I (excluding non-controlling interests)           259.1     242.2
 FFO II (including disposal of investment property)    255.9     240.6
 Capex-adjusted FFO I (AFFO)                           122.6     121.9

32 I     November 2019
V.       Financials: Strong Balance Sheet
Balance sheet 30 September 2019
                                                                      Revaluation €551.6m
 € million                                 30.09.2019   31.12.2018    Capex €132.4m
       Investment properties               11,276.6     10,709.0      Reclassifications (Disposal)
                                                                       -€178.9m
       Other non-current assets              222.6        175.9       Acquisitions €25.9m
 Non-current assets                        11,499.2     10,884.9      IFRS 16 and Others €36.6m

       Receivables and other assets            96.2         55.4
                                                                      Cash flow from operating
       Cash and cash equivalents             382.3        233.6        activities €224.8m
                                                                      Investing activities
 Current assets                              478.5        289.0
                                                                       - €4.7m
 Assets held for sale                        172.5          20.3      Financing activities
 Total Assets                              12,150.2     11,194.2       -€71.4m

 Equity                                     5,549.5      4,783.9
       Non-current financing liabilities    4,319.4      4,113.3
                                                                     Financing liabilities
       Other non-current liabilities        1,618.1      1,382.3      Loan proceeds €436.5m
 Non-current liabilities                    5,937.5      5,495.6      Repayment of loans
                                                                       -€270.2m
       Current financing liabilities         257.8        484.8
       Other current liabilities             405.4        429.9
 Current liabilities                         663.2        914.7
 Total Equity and Liabilities              12,150.2     11,194.2

33 I      November 2019
V.       Financials: Strong Balance Sheet
LTV 30 September 2019

 € million                                     30.09.2019   31.12.2018

       Financial liabilities                     4,577.2      4,598.1     Strong balance sheet (LTV
                                                                           target: 40-43%) after equity
       Leasing liabilities (IFRS 16)                32.1          0.0      conversion of the 2014/2021
                                                                           convertible leaves headroom
       Cash & cash equivalents                     382.3        233.6      for further growth investments
                                                                          Potential for further de-
 Net Debt                                        4,162.8      4,364.5      gearing via capital growth
       Investment properties                    11,276.6     10,709.0
       Properties held for sale                    172.5         20.3
       Prepayments for investment properties         4.3            -

 Property values                                11,453.4     10,729.3

 Loan to Value (LTV) in %                           36.3         40.7

34 I     November 2019
V.          Financials: Strong Balance Sheet
LT financing secures future earnings growth
           Weighted avg. interest (excl. subsidised loans)
%
           as of 30.09.2019                                       1.3%
                                                     1.6%
                                                                  €962m
                                                      €908m
                                                                                                                                                   Variable
                                                                                                                                                   interest
                                                                                                                                                    9.9%
                                                                          1.6%
                                                                                          1.6%
                                                                          €536m   1.7%
                                              2.2%                                                                                 Swaps
                                                                                          €458m
                                                                                  €420m                                            12.7%
                                              €360m
                      1.0%                                                                                        €290m                                  Fixed
                             4.2%                                                                                                          30.09.2019
                     €172m            2.8%                                                        1.4%     1.8%                                         interest
         0.5%                €133m                                                                €120m                                                  77.3%
                                      €106m                                                               €102m
    €23m

                1)                                           3)
      2019           2020 2) 2021     2022    2023    2024        2025 4) 2026    2027    2028     2029   2030 2031 ff
    1) remaining volume convertible bond 2014/21 (€23m)
    2) commercial paper (€100m)
    3) corporate bond (€500m)
    4) convertible bond (€400m)

                                         Key Facts                                                                        Maturities
    Average debt maturity                             7.3 years (7.4 years)5                     0-2 years                                 4.2% (2.1%)5

    Interest costs                                    Ø 1.64% (1.68%)5                           3-5 years                             13.1% (13.3%)5

    Hedging ratio                                     90.1% (89.9%)5                             6-8 years                             52.5% (53.6%)5

    Rating                                            Baa1 (Moody‘s)                             ≥ 9 years                             30.3% (31.0%)5
 5)      excluding commercial paper

35 I          November 2019
EPRA-Net Asset Value
EPRA-Net Asset Value 30 September 2019

 € million                                                                                 30.09.2019           31.12.2018               €486.2m net profit
 Equity (excl. minority interests)                                                              5,527.4            4,757.6               €551.5m equity conversion
                                                                                                                                         -€41.5m change in OCI
 Effect of exercising options, convertibles and other rights                                       86.7              553.9               -€223.1m dividend
                                                                                                                                         -€3.3m IFRS 16 and Others
 NAV                                                                                            5,614.1            5,311.5
 Fair value measurement of derivative financial instruments                                         71.5             222.2
 Deferred taxes1)                                                                               1,281.7            1,132.7
 EPRA-NAV                                                                                       6,967.3            6,666.4
 Number of shares fully-diluted incl. convertible (m)2)                                         69.010              68.824             Comment on pro forma NAV
                                                                                                                                       post conversion
 EPRA-NAV per share in €                                                                        100.96               96.86             This figure incorporates an
                                                                                                                                       equity conversion of the
 Goodwill resulting from synergies                                                                  52.7               52.7
                                                                                                                                       2014/2021 convertible which
 Adjusted EPRA-NAV (excl. goodwill)                                                             6,914.6            6,613.7             was nearly completed at end of
                                                                                                                                       Q3 (92.5% and the remainder
 Adjusted EPRA-NAV per share in €                                                               100.20               96.10             in October 2019)

 Effects from a simulated executed conversion                                                       22.2             -185.7
 Pro forma NAV (excl. goodwill) post-conversion                                                 6,936.8            6,428.0
 Pro forma NAV post conversion per share in €                                                   100.52               93.40

  Attractive rental yield of 5.3% (thereof free financed portfolio 5.4%) and low value per sqm (€1,295) still reflect an
   average gap to current transaction prices
  Value of services business as attractive hidden gem not included in NAV
        Scenario: additional value approx. €5.20-€7.80 per share (discount rate of 4.0%-6.0%)3)
 1) And goodwill resulting from deferred taxes on EPRA-adjustments   2) Actual number of shares outstanding:      3) Assumption: expected 2020 FFO, growth rate of 0%
                                                                       68.6m (30.09.2019), 63.1m (31.12.2018)

36 I   November 2019
Agenda

 I.           LEADING OPERATING PERFORMANCE       Leading operating performance and profitability on
                                                  basis of a regionally focused business model

 II.          ATTRACTIVE NRW MARKET               Metropolitan region benefitting from sound growth
                                                  prospects; net immigration as key growth driver

 III.         MARKET LEADING PLATFORM WITH        Proven track record for value accretive acquisitions in
              EXTERNAL GROWTH POTENTIAL           core markets with high synergies

 IV.          INNOVATION & VALUE-ADDED SERVICES   Creating additional value by leveraging value of the
                                                  customer base; aspiration to become a digital leader

 V.           FINANCIALS: HIGH PROFITABILITY –    Sound FFO and dividend growth on basis of leading
              STRONG BALANCE-SHEET                operating profitability and long term secured financing

 VI.          BUSINESS UPDATE & OUTLOOK

37 I    November 2019
VI.      Business Update
Accelerating external growth

Portfolio growth supported by the broadening of the regional scope
      LEG remains net buyer with acquisition of portfolios with c. 5,700 units YTD (thereof 210 newly built apartments)
      Purchase of c. 2,600 units outside of NRW underpins LEG’s sourcing capabilities also outside its previous core region
      Bulk of the transactions become effective in 2020; annualised FFO impact of €13-14m (c. €6-7m net after disposals)
      Several smaller deals in negotiations
      Firepower for further acquisitions in 2020 > €400m

Further capital growth ahead
  Expected valuation uplift of approx. 8% for FY-2019 (+5.1% in H1-2019)
  Drivers are yield compression and rent performance

Early refinancing of loans: Extension of maturity profile at lower interest cost
  Early loan redemptions planned (volume c. €340m), positive net FFO effect of c. €7m p.a. (one-time cost c. €27m)

Commitment to corporate social responsibility
  Additional foundation planned (capital contribution of €16m); objective: support of preventative measures for tenants
  Voluntary commitment to lower modernisation yields (depending on affordability) and more conservative approach with
   regard to adjustments from rent tables

38 I    November 2019
VI.     Business Update
Accelerating external growth

Acquisitions                Residential              Purchase price     Rent multiple     Price / sqm       FFO p.a.
signed in 2019              units
                            5,516                    approx. €500m      21.7x             €1,433            c. €13m
                                                                                                            (FY 2020)

                            Top 5 locations                           Units      Federal state          Market segment
                            Bremen                                  1,160        Bremen                  stable
                            Greater Aachen region1                  1,094        NRW                     high growth
                            Oldenburg                                 912        Lower Saxony            high growth
                            Dortmund                                  269        NRW                     stable
                            Duisburg                                  193        NRW                     higher yielding
                       1)   Baesweiler, Alsdorf, Übach-Palenberg

Development                 Residential              Purchase price     Rent multiple     Price / sqm       FFO p.a.
Projects2                   units
                            2103                     approx. €38m       26.5x             €2,576            c. €0.9m

                       2)   Dortmund, Bielefeld, Lüdenscheid
                       3)   including 99 subsidised units

39 I   November 2019
VI.      Business Update
Outlook for 2019 & 2020

                                                   2019                       2020
KPI
                                                                                                  prev.
       FFO I                                  €338m - €344m              €370m - €380m            €356m-€364m

                           prev.
       L-F-L rent growth   3.0-3.2%              c. 3.0%           c. 2.8% (3.0 % excl. refinancing)    prev.
                                                                                                        3.2-3.4%

       L-F-L vacancy       prev. slighty      stable (≙3.3%)        slightly decreasing (~3.0%)
                           decreasing

       EBITDA margin                              ~73%                        ~74%

       Investments                             ~30-32€/sqm                ~31-33€/sqm

       Dividend                            €3.60 (>70% of FFO I)          70 % of FFO I

40 I    November 2019
VI.        Business Update
Attractive Dividends from Robust Cash Flows
                 NAV per share (€), excl. goodwill                                                   Dividend per share (€)

                                                                            100.521)

                                                              93.401)

                                                 80.901)

                                                                                                                                     3.53

                                      67.15                                                                                   3.04

                                                                                                                   2.76
                          58.92
                                                                                                         2.26
              52.69
                                                                                              1.96
   49.39
                                                                                       1.73

  2013        2014         2015        2016        2017        2018         Q3-2019    2013   2014       2015      2016       2017   2018

 1) For 2017, 2018, Q3-2019 pro forma NAV per share is shown and applied.

41 I   November 2019
LEG Share Information

                           Basic data                                  Well-balanced shareholder structure

 • Prime Standard, Frankfurt Stock Exchange
 • Total no. of shares: 69,009,836 (68,573,216 as at 30.09.2019)
 • Ticker symbol: LEG
                                                                                                      MFS
 • ISIN: DE000LEG1110                                                                                 9.6%

 • Indices: MDAX, FTSE EPRA/NAREIT, GPR 250,                                                                  BlackRock
                                                                                                                 7.5%
               Stoxx Europe 600
                                                                                                                      BNP Paribas
 • Weighting (30.09.2019): MDAX 2.75%; EPRA 2.68%                                                                        3.2%
 • Rating: Baa1 (stable) by Moody’s

        Share price (13.11.2019, indexed; 31.01.2013 = 100)

 300
                                                                    Other free
 250                                                                   float
 200                                                                  79.7%
 150
 100
  50
   0
       05-2014
       08-2014

       11-2015

       08-2016

       02-2018
       02-2013
       05-2013
       08-2013
       11-2013
       02-2014

       11-2014
       02-2015
       05-2015
       08-2015

       02-2016
       05-2016

       11-2016
       02-2017
       05-2017
       08-2017
       11-2017

       05-2018
       08-2018
       11-2018
       02-2019
       05-2019
       08-2019
       11-2019

                          EPRA Germany      LEG                    Source: LEG; shareholdings according to voting rights notifications

42 I   November 2019
Financial Calendar

Date                   Report/Event

11.03.2019             Annual Report 2018

09.05.2019             Quarterly Statement Q1 as of 31 March 2019

29.05.2019             Annual General Meeting, Düsseldorf

09.08.2019             Quarterly Report Q2 as of 30 June 2019

15.11.2019             Quarterly Report Q3 as of 30 September 2019

20.11.2019             Roadshow London, Bank of America Merrill Lynch

22.11.2019             Roadshow Amsterdam, Kempen

27.11.2019             Roadshow Zurich, UBS

28.11.2019             Berenberg Real Estate Seminar, Paris

03.12.2019             UBS Global Real Estate Conference, London

05.12.2019             Berenberg European Corporate Conference, Surrey/UK

43 I   November 2019
Contact
  Investor Relations

    Burkhard Sawazki
    Head of Investor Relations &
    Strategic Business Analysis
    Tel: +49 (0) 211 4568-204
    burkhard.sawazki@leg.ag

    Karin Widenmann
    Senior Manager Investor Relations
    & Strategic Business Analysis
    Tel: +49 (0) 211 4568-458
    karin.widenmann@leg.ag

LEG Immobilien AG                       Phone: +49 (0) 211 4568-400
Hans-Boeckler-Str. 38                   Fax: +49 (0) 211 4568-22 204
40476 Düsseldorf, Germany               E-Mail: ir@leg.ag

  44 I   November 2019
Appendix
LEG Management Board

                                               Lars von Lackum                                       Dr. Volker Wiegel
                                                     CEO                                                   COO

                       • Strategy, M&A, Organisation and          • Controlling & Risk             • Asset and property
                         Digitisation                               Management                       management, including
                       • Executive and Supervisory Board Office   • Corporate Finance & Treasury     commercial management
                       • Law, Compliance & Internal Audit         • Investor Relations               and district management
                       • Human Resources                          • Portfolio Management           • Modernisation &
Responsibilities       • Corporate Communications                 • Accounting & Tax                 Procurement
                       • Acquisitions                                                              • Rent, Capex / Opex, Mgt.
                       • Project development                                                       • Repairs Management
                                                                                                   • Energy Services

With LEG               Since 2019                                                                  Since 2013

In Industry            6 years                                                                     Since 2013

46 I   November 2019
The LEG portfolio is highly attractive

       Aachen          Düsseldorf    Duisburg   Hamm

       Köln            Minden       Münster     Osnabrück

       Ratingen        Remscheid     Siegburg   Solingen

47 I   November 2019
Portfolio Structure
      30 September 2019

                                       Construction Years                             Free Financed / Rent Restricted Units
                               After 1989
                                                                   Until 1949
                                                  5%       12%                           Rent
                                                                                       restricted
                                                                                         units
                 1970-1989          25%                                                                    25%

                                                                                                                      75%
                                                       57%                                                                         Free
                                                                          1950-1969                                             financed
                                                                                                                                  units

                                          Building Types1)                                          Apartment Size2)
                                                                                                           > 90
Portfolio
Sound property fundamentals basis for value growth

As of 30.09.2019; IAS 40 only, IFRS5 excluded
                                                                                                Market
                                                                                               Multiples,      GAV
                                            GAV        % of Total                              Estimated    Commercial/
                           Residential   Residential   Residential    GAV/       In-Place        Rental       Other
 Market                      Units       Assets (€m)      GAV        sqm (€)   Rent Multiple    Values1)    Assets (€m)   Total GAV
 High-
 Growth                      41,497         4,946         46%         1,798       23.1x          20.0x         236         5,182
 Markets

 Stable
 Markets                     48,313         3,474         32%         1,124       17.4x          16.1x         125         3,599

 Higher-
 Yielding                    39,476         2,222         21%         932         15.3x          14.3x          65         2,287
 Markets

 Subtotal NRW               129,286        10,642         98%         1,294       19.0x          17.2x         426        11,068

 Portfolio outside
                             1,849          169            2%         1,369       18.8x          17.6x           2           171
 NRW

 Total Portfolio            131,135        10,811        100%         1,295       19.0x          17.2x         428        11,239

 Other Assets                                                                                                                237

 Total                                                                                                                    11,476
 1) As of June 30, 2019.

49 I   November 2019
Portfolio Overview
Above inflationary rent growth and high occupancy
• EPRA-vacancy of 3.3% (l-f-l) as of FY-2018
• Significant rent upside1) potential with current in-place rents of € 5.65/sqm/month (as of FY-2018), approx. 13% below market
  rent levels
• In-place rent for unrestricted units has increased by approx. 3.9% (l-f-l) yoy, outperforming inflation
                                Residential                                                             Market                                                             Rent CAGR last 5 Occup. CAGR
Market (FY-2018)                  Units               % of total rent            Rent /sqm            rent3)/sqm          % to market1)            EPRA-Vacancy                yrs (lfl)*    last 5 yrs*

High-Growth
                                    41,423                   37%                      6.36                7.48                  18%                       2.0%                      2.9%                   -0.9%
Markets

Stable
                                    48,965                   35%                      5.34                5.92                  11%                       3.1%                      2.7%                   5.1%
Markets

Higher-Yielding
                                    41,731                   27%                      5.23                5.68                   9%                       5.9%                      2.8%                   -2.2%
Markets

Total2)                            133,969                  100%                      5.65                6.38                 12.8%                      3.5%                      2.9%                   0.4%

                            % Sub-                                                                                             % free
Market                      sidised                EPRA-Vac. Rent CAGR Occ. change last                                      financed                        EPRA-Vac. Rent CAGR Occup. CAGR
(FY-2018)                    units        Rent/sqm    (%)   last 5 yrs (lfl)* 5 yrs*                                           units          Rent/sqm          (%)    last 5 yrs (lfl)* last 5 yrs*
 High-Growth
                              29%             5.03           0.8%              1.0%                  22.9%                      71%              6.96             2.4%               3.8%                  -2.0%
 Markets
 Stable
                              29%             4.70           2.1%              1.1%                  27.7%                      71%              5.63             3.5%               3.5%                  3.8%
 Markets

 Higher-Yielding
                              21%             4.49           4.4%              0.9%                   9.5%                      79%              5.45             6.2%               3.4%                  -2.4%
 Markets

 Total2)                      26%             4.77           2.1%              1.1%                  20.6%                      74%              6.00             3.8%               3.7%                  -0.5%
Source: LEG, CBRE
* As of FY-2018 and FY-2014
Note: Rent change free financed/subsidised is same store. 1) rent upside is defined as the difference between LEG in-place rent and market rent, the latter of which is an indicator of an average rent value that
     could theoretically be achieved, not implying that an adjustment of the in-place rent to the market rent is feasible, as stringent legal and contractual restrictions regarding rent increases exist.
     2) Total includes an additional 1,850 residential units located outside NRW 3) Cf. Footnote 1 for a definition of market rent

50 I      November 2019
Portfolio Overview
Well-balanced portfolio with significant growth potential
   30.09.2019                        Units                            Gross Asset Value                            Rental Income

                                      1%                                           2%                                    2%

                                                                             21%
                               30%           32%                                                                   26%         38%
                                                                                        46%
  By Market

                                     37%                                     32%
                                                                                                                         35%

                        High Growth Markets        Stable Markets   Higher Yielding Markets      Non-NRW Markets

                       Subsidised                               Subsidised                                  Subsidised
                         25%                                      26%                                         23%
  Restricted

       vs.

                                                      Free-                                     Free-                                  Free-
 Unrestricted                                       financed                                  financed                               financed
                                                       75%                                       74%                                    77%

51 I   November 2019
Sustainability
What we have done so far

 Creation of an organisational and reporting structure

                                                                              Sustainability Manager
                                                                                                       Management Board
 • Management Board bears overall responsibility
 • Top decision-maker: CEO
 • Steering Committee for strategic decisions and pooling of the activities                            Steering Committee
   includes more than 10 Heads of key divisions/functions
 • Sustainability Officers/Data Owners in various departments for
   monitoring the achievement of goals and for data collection                                            Data Owner
 • Sustainability Manager as interface

 Disclosure and assessments

 • Annual Sustainability Report based on GRI standard, including
   EPRA Sustainability Performance Measures
   (third party assurance: limited assurance by PwC)
 • Participation in GRESB real estate assessment

52 I   November 2019
Sustainability
Roadmap 2023: Commitment to environmental targets

 Given that housing is the sector that contributes most to carbon emissions we set ourselves targets
 that help reducing energy consumption and carbon emissions of our property portfolio.

 Environmental targets

 • Energy efficient modernisation of more than 15% of our portfolio
       (i.e., 3% p.a. on average) from 2017-2021
 • Thereby reducing the number of residential buildings in energy efficiency
       classes G and H by more than 20%
 • Increasing tenants’ awareness by enhancing consumption transparency
                                                                                       A+/A B   C   D   E   F   G   H

 Further sustainability targets

 • Compliance: further reduction of compliance risks
 • Tenants: stable or increasing tenant satisfaction, steady improvement of services
 • Employees: increase in employee satisfaction and employer attractiveness
 • Sustainability reporting: close data gaps

53 I     November 2019
Leading Performance
Capex – Watch the value traps

                                       Investment /       IRR at 7% yield   Required yield on
 Measure               Life cycle                                                               Rent increase in %
                                       apartment (in €)   on costs          costs (6% IRR)

 Floor covering        15 years        1,100              0.1%                  10.3%               2.6%

 Bathroom              30 years        5,000              5.7%                  7.3%                8.5%

 Kitchen               10 years        3,000              negative              13.6%               9.5%

 Conclusion for LEG:

             Bottom-up investment approach with strict IRR targets
             Capital discipline is key – not overpaying for growth
             LEG aims at capital efficiency

54 I   November 2019
Rent revisionary potential
Refinancing of subsidised loans lifting value

     Rent Potential Subsidised Units                                                           Number of Units Coming Off Restriction and Rent Upside
    In the following 10 years more than                                          # Units                                                                                                   c. 17,000
                                                                                                                                                                                                          c. 8,800
     24,000 units will come off rent                                                                              2,166
     restriction                                                                                     1,733                    1,589

                                                                                         697                                                827
    Units show significant upside to                                                                                                                    164                      242
                                                                                                                                                                      36
     market rents
                                                                                        2020         2021         2022        2023         2024         2025         2026        2027         2028      2029 et seq.
    Subject to general legal and other
     restrictions, the economic upside can
     theoretically be realised the year                                                                        Spread to Market Rent (in €/sqm/month)
     after restrictions expire

                                                                                        3.36
                                                                                                     2.67
                                                                                                                                            1.81                     1.74                      1.92
                                                                                                                               1.43                                               1.35
         ≥10 years                                                                                               1.03                                    1.43                                                 1.18
          25.8%                               ≤ 5 years
                                               18.9%
                                                                                       2020         2021         2022         2023         2024         2025         2026         2027         2028     2029 et seq.

                                                                                                                                      ≤ 5 years2)                6 – 10 years2)                  ≥ 10 years2)
                                                                                   In-place rent                                        €4.60                          €4.90                          €4.90
                                               6-10 years
                                                                                   Market rent1)                                        €6.48                          €6.72                          €6.01
                                                 55.3%                             Upside potential3)                                    41%                            37%                             23%
                                                                                   Upside potential          p.a.3)                    €10.9m                         €22.1m                          €10.2m

Source: LEG as of Q3-2019
1) Employed by CBRE as indicator of an average rent value that could theoretically be achieved, not implying that an adjustment of the in-place rent to the market rent is feasible, as stringent legal and
    contractual restrictions regarding rent increases exist.
2) ≤5 years = 2019-2023; 6-10 years = 2024-2028; ≥10 years = 2029ff.
3) Rent upside is defined as the difference between LEG in-place rent as of Q3-2019 and market rent (defined in footnote 1) as of Q2-2019.

55 I      November 2019
Rent Regulation: Political Discussion
Increasing political discussion
Coalition agreement of the Federal Government of Germany
Future changes according to the coalition agreement and current drafts of Federal Government:

             Topic                                         Description                                Impact for LEG

                              • Extension of validity period from 2 to 3 years and agreement on       Validity period effects only a
 Mietspiegel                    change of reference period from 4 to 6 years (draft law)
                                                                                                      periodic shift. Extension of
                                                                                                      reference period likely to have a
 (reference rent)             • Both changes solely applicable for qualified Mietspiegel              marginal negative impact on
                                                                                                      rent growth.

                              • Reduction of modernization charge from 11% to 8%                      LEG is only slightly affected,
                                (review after 5 years)                                                due to pursuit of a less
Modernization
                              • Rent increase max. €3 per sqm over a period of six years              aggressive modernization
                                                                                                      approach.
                                (rents below €7 per sqm: limitation to max. €2 per sqm)

Reletting                     • Mandatory disclosure of previous tenant’s rent                        No impact for LEG.

 Mietpreisbremse              • Assessment of suitability and effectiveness in NRW is ongoing in
                                                                                                      LEG does not face significant
                                2020                                                                  effects.
 (rental cap)

                              • Reform of the land transfer tax (Grunderwerbsteuer) includes
Share deals                     lowering the threshold from 95 to 90% and increasing the holding      LEG does not expect significant
                                                                                                      effects (only for PE deals).
                                period from 5 to 10 years (which makes share deals less profitable)
Currently discussed on state level (Berlin) and demanded by certain political groups:
                              • Rental freeze as proposed in Berlin is not expected to be expanded    No impact for LEG. NRW
Rental freeze                   to NRW or local level.                                                government disapproves of this
                                                                                                      instrument.

56 I   November 2019
You can also read