DEUTSCHE BANK PRESENTATION 23/24 November 2015Impact of new competition on existing shopping centre performance

Where are we?

• 7.5% p.a. growth in shopping centre GLA since 2005

• More than 2000 shopping centres

• 6th highest per capita shopping centre GLA in world

• And

• 2.2mil m² shopping centres on drawing board

• Mall of Africa, Ballito, Springs, Cornubia, Menlyn et al in the ground: additional 500k+ m2

The disconnect

Why the continuing development?• Extrapolation by retailers of “unusual” 2004 – 2007 trading performance• Retailer obsession with market share at expense of profitability • Retailer herd mentality• Relative low fixed costs in growing retailer space – labour & rental• Developers subsidizing store development costs• Long lag time between commitment and taking delivery• Poor market-demand research for both retailers and developers • Financial institutions eagerness to “grow” credit book• Availability of “put options” to listed REITS• REITS eagerness to increase exposure to retail assets• Poor/non-existent town planning and local authorities’ eagerness to grow tax base

Consequences:

• Continuing decline in trading densities

• Ongoing retailer cannibalization and margin compression

• Increasing occupancy cost to turnover ratios leading to low rental growth

• Increased operating costs at centre level – marketing

• Over-capitalization in retail assets in order to compete

• Declining values for owners and local authorities

• “Dead Mall” syndrome & “still born” malls

PERFORMANCE RATING OF POST 1995 SHOPPING CENTRESExcluding Rural and Township centres

PERFORMANCE RATING OF POST 1995 SHOPPING CENTRESSHOPPING CENTRES BIGGER THAN 30 000m2 DEVELOPED 2000 - 2008

MOFFET RETAIL PARK 2000 3 GARDEN ROUTE 2005 3MIMOSA MALL 2000 4 WILLOWBRIDGE 2005 2KEY WEST 2000 4 TRADE ROUTE 2006 2PRINCESS CROSSING 2000 2 CENTURION LIFESTYLE 2006 2CANAL WALK 2000 6 VAAL MALL 2006 5GATEWAY 2001 6 KOLONNADE RETAIL PARK 2006 2LONGBEACH MALL 2001 2 MOUNTAIN MILL WORCESTER 2006 2MALL @ REDS 2003 4 GREENSTONE 2007 4LIBERTY MIDLANDS MALL 2003 6 MAPONYA MALL 2007 2BALITO LIFESTYLE 2003 4 CEDAR SQUARE 2007 2LIBERTY PROMENADE 2003 6 IRENE MALL 2007 2PAARL MALL 2003 3 HIGHVELD MALL 2007 5CLEARWATER 2004 5 FOUNTAINS MALL - J/BAY 2008 1FESTIVAL MALL 2004 4 WOODMEAD RETAIL 2008 4WOODLANDS 2004 4 MELROSE ARCH 2008 1CARNIVAL MALL 2005 4 STONERIDGE 2008 1ECO BOULEVARD 2005 1 WONDERBOOM JUNCTION 2008 3EAST RAND RETAIL PARK 2005 3 ARBOUR CROSSING 2008 2ZAMBESI RETAIL PARK 2005 1 WESTWOOD MALL 2008 1SOUTHCOAST MALL 2005 2 MOOIRIVER MALL 2008 4CAPE GATE 2005 3 ZEVENWACHT MALL 2008 2

PERFORMANCE RATING OF POST 1995 SHOPPING CENTRESSHOPPING CENTRES BIGGER THAN 30 000m2 DEVELOPED POST 2008HEMMINGWAYS 2009 1 BRITS MALL 2012 1THE GROVE 2009 2 CRADLESTONE 2013 2PARKVIEW PTA 2009 1 SUNWARD LIFESTYLE 2013 2GALLERIA 2009 3 TUBATSE CROSSING BURGERSFORT 2013 1WESKUS MALL 2009 2 SECUNDA MALL 2013 5GOLDFIELDS MALL 2010 3 KALAHARI MALL 2013 2L'LANGA NELSPRUIT 2010 2 FOREST HILL 2014 1PLATINUM SQUARE 2010 1 NEWTOWN JUNCTION 2014 1MALL OF THE NORTH 2011 4 HEIDELBERG MALL 2014 2NEWCASTLE MALL 2012 3 MATLOSANA MALL 2014 1MIDDELBURG MALL 2012 4 BAY WEST 2015 1

COMPETING SHOPPING CENTRES: RUSTENBURG

Analysis of competition impact: Growthpoint Portfolio Waterfall Mall & Value Centre Platinum SquareDate of Development 1998 & 2007 Nov-12GLA - m2 59518 32300Current Trading density R2850/m2

Major Tenants

PnP, GAME, Woolworths, Clicks, Ster Kinekor, Truworths, Foschini, Mr Price, Corricraft, The Hub, Waltons

Checkers Hyper, Foodlovers Market, Sportsmans warehouse, MRP Home, Dion Wired, House & Home, Toys-R-Us, UFO Furniture

Performance also impacted by platinum mine strike in 2014

Level of Competition Competition limited to non fashion retailers

Overall Trading Density change Trading Density change excl PicknPay & GAMEFoot Counts Change

2011 - 2012 8.0% 7.0% 2012 - 2013 -8.0% -3.5% -5%2013 - 2014 -5.0% -4.2% -6%2014 - current 5.0% 7.1% -2%

Trading Density change : 2012 to currentPicknPay -32% R80 mil p.a.GAME -30%Incredible Connection -25%Identity -18%Ster Kinekor -16%Clicks -9%Edgars -7%

COMPETING SHOPPING CENTRES: KRUGERSDORP/ROODEPOORT

Analysis of competition impact: Growthpoint Portfolio Keywest Krugersdorp Cradle StoneDate of Development 2000 Nov-13GLA - m2 52000 76422Current Trading Density R2100/m2

Major tenantsPnP, GAME, Woolworths, Clicks, NuMetro, Truworths, Foschini, Mr Price, Virgin Active

Checkers, PnP, Woolworths, Foodlovers Market, GAME, Dion Wired, Edgars, Truworths, Foschini, Mr Price, Dischem, Ster Kinekor

Level of Competition Competition across all retailers

Overall Trading Density change Trading Density change excl national retailersFoot Counts Change

2012 - 2013 7.0% 7.4%

2013 - 2014 -3.0% 1.0% -3%

2014 - current 6.0% 10.0% -3%

Decline in Trading Density: Yr 1 Decline in Trading Density: Current year

GAME -22% Maxi's -17%

Edgars -11% Foschini -9%

Jewellery -10% GAME -5%

Foschini -8%

Ackermans -7%

PEP -7%

Woolworths -6%

PicknPay -5%

COMPETING SHOPPING CENTRES: KLERKSDORP

Analysis of competition impact: Growthpoint Portfolio City Mall Klerksdorp Matlosana Mall Flamwood

Date of Development 1997 Nov-14 2014GLA - m2 24638 63000 19396Current Trading Density R1400/m2

Major tenants

Woolworths, The Hub, JET, Clicks, Mr Price, Ackermans, Foschini, Truworths

PicknPay, Checkers, Woolworths, Foschini, Truworths, MrPrice, Edgars, Ackermans, Ster Kinekor

Hi-Fi Corporation, Dischem, Fruit & Veg City, Sportsmans Warehouse, Checkers, Incredible Connection, GAME

Level of competition Full competition across all retailers

Trading Density Impact

Rand value loss - Rmil

Trading Density

Impact ex WW

Foot counts

Nov-14 -28.0% 13 -25% -22%Dec-14 -23.0% 15.3 -19% -18%Jan-15 -24.0% 8 -17% -20%Feb-15 -22% 6.5 -17% -19%Mar-15 -21% 6.7 -19% -18%Apr-15 -28% 12.5 -25% -23%

May-15 -20% 7.9 -13% -24%Jun-15 -19% 6.6 -13% -15%Jul-15 -18% 6.8 -14% -10%

Aug-15 -19% 6.8 -17% -15%Sep-15 -28% 10.2 -21% -15%

Analysis of competition impact: Port ElizabethWalmer Park Greenacres The Bridge Baywest

Date of Development 1988 1981 1991 2015GLA - m2 43020 40398 45708 86995Current Trading Density R 2,750 R 2,400 R 1,750

Major tenants

Woolworths, Edgars, Nu Metro, Zara, Clicks, Mr Price, Ackermans, Foschini, Truworths

Checkers, Woolworths, Edgars, Ackermans, Truworths, Foschini

Shoprite, GAME, Mr Price, Ster Kinekor

PicknPay, Checkers Hyper, Woolworths, Edgars, Ster Kinekor, Ice Rink, GAME, Truworths, Foschini

Level of Competition Competition across all retailers

WALMER PARK GREENACRES THE BRIDGE

Jun-15 -0.3% -8.0% -1.4%

Jul-15 7.0% -10.0% 0.6%

Aug-15 -0.8% -5.0% 4.5%

Sep-15 -1.3% -4.0% 1.9%

SIGNIFICANT TURNOVER CHANGE OVER PERIOD

WALMER PARK GREENACRES THE BRIDGE

Edgars -21% -17%

Shoprite -5.10%

Truworths -9%

Jet -7%

Cinemas -18% -29%

Cotton On -26% Duplicated stores

Lecreuset -25% Duplicated stores

Restaurants -18%