#1MAURITIUS SITE VISIT MARCH 2019 Mauritius grit#21 2 Contents Group Overview Country Overview Portfolio Overview Mauritius SSSS grit#3Hosting Today Bebe Bronwyn Corbett Chief Executive Officer Debby Kippen Group Asset Manager 13 Bronwyn has significant corporate finance and deal making experience. She played an instrumental role in the JSE listing of Delta Property Fund Limited in 2012 where she held the positions of Chief Financial Officer and Chief Operating Officer prior to taking up the leadership role at Mara Delta Property Holdings. During her tenure at Delta Property Fund Limited, Bronwyn spearheaded the diversification of the REIT's funding sources into the debt capital markets, leading to the establishment of a ZAR2 billion Domestic Medium Term Note Program (DMTN program). She led the team responsible for obtaining a national scale issue rating from Global Credit Ratings as part of the DMTN program. In addition, Bronwyn co-headed the team responsible for growing assets under management from ZAR 2.2 billion at listing to ZAR 11.8 billion in May 2016. Bronwyn is a founder member and served as non- executive director on the board of Mara Delta Property Holdings (now Grit Real Estate Income Group) where she played a significant role in the listing and conversion of the fund to its current pan-African focus, underpinned by dollar based leases. She assumed the role of Chief Executive Officer in the lead-up to the fund's merger with Pivotal to form Mara Delta. She has grown the portfolio from $220 million at inception to approximately $800 million currently. Debby has almost 30 years' experience in the Commercial Property Industry. After graduating from UCT she started her career at Fedsure which was subsequently acquired by Investec Property Group. This relationship spanned a period of some fifteen years. Initially starting out in marketing, she progressed into Retail Centre Management and Portfolio Management for the Kwa-Zulu Natal and Eastern Cape portfolios. For the last 11 years Debby headed up the Eris Property Group KZN office as Regional Manager for KZN and Eastern Cape. She was responsible for growing the groups business as well as managing existing assets for both third party and internal clients in commercial, retail and industrial portfolios. During her career she has also focused on the management of rural property developments in the Eastern Cape and northern KZN. During this time she represented property owners on various Association Boards including the La Lucia Ridge Office Estate, Ridgeside Office Estate and Westway Office Park and was the founding Chairperson of the Board for the Umhlanga Village UIP. Prior to joining Grit Real Estate Income Group, Debby was General Manager for Broll in Property and Facilities Management in Mauritius.#414 Hosting Today After completing articles with PwC, Leon moved to the Global Risk Management Services within PwC, where he become the Senior Manager in charge of Data Management. In 2004, he moved to Solenta Aviation where he became Group Finance Director within 18 months. During his tenure as Group Finance Director, the group expanded from 12 aircraft to 48 aircraft, operating in 8 African countries (including South Africa, Mozambique, Algeria, Ghana, Gabon, Kenya, Tanzania and Cote d'Ivoire). He joined Grit in April 2015 as CFO, where he has continued to utilize his tax structuring knowledge and experience in operating in Africa to expand the asset base of the group. Leon van de Moortele Chief Finance Officer Bevan Smith Senior Investment Manager Bevan is a chartered accountant with an Honors Degree in Accounting from Unisa and is also a CFA charter holder. Bevan joined the Delta Group in 2015 as an Investment Manager and then moved into the role of Senior Investment Manager at Grit Real Estate Income Group. Prior to joining Grit Real Estate Income Group Bevan played the roll of Investment Principal at RH Managers, a boutique private equity firm, specializing in green field healthcare investments within South Africa. In 2013 Bevan was instrumental in the successful listing of Accelerate Property Fund on the JSE, which consisted of 51 properties, valued at R5.9 billion. Post completion of his articles in 2009, Bevan joined EY's corporate finance division TAS, where he gained invaluable experience in due diligence, valuations, lead advisory, business modelling and JSE related activities.#5GROUP OVERVIEW#6Designed to Perform Delivering attractive, stable & sustainable shareholder returns through selective risk mitigated investments Experienced, well-resourced Strong & broad African management exposure Talented team Margins of Safety 01 team, in-country management, Hard currency alignment of interests. 02 Repatriation of funds Robust risk mitigation 03 Political risk & macro-economics Consistent performance 9 consecutive dividend payments Quality portfolio Diversification, investment grade Relationship strength Joint ventures, access to pipeline 16 04 Land tenure 05 Ability to raise debt 06 Counterparty Compelling USD returns High quality long-term hard currency income Blue-chip multinational tenants Mauritius grit#71 7 Socio-economic Impact - Grit Group Total 97 Employees 70 Local: 27 Expat Expat 28% Local 72% Grit Services Ltd - 51 Employees Gender Distribution [CATEGORY NAME] [PERCENTA GE] 32 Female: 19 Male O Male 44% Mauritius SSSS grit#8Attractive & Diversified Portfolio 7 countries, 5 asset classes, 25 assets¹ Country Value Mozambique Mauritius US$280m US$162m Morocco US$92m Zambia श्री US$170m Ghana US$55m Kenya US$34m Botswana US$3m 18 S $$ 96.0% Occupancy² at reporting date Total Portfolio Value4 (US$m) Properties acquired Office: 2 HY19 796.4 Corp. Accomm: 1 Light Industrial: 2 96.6% Occupancy² FY18 Corp. Accomm: 1 642.3 31 Jan '19 Office: 1 Other: 1 FY17 Hospitality: 4 490.4 Retail: 2 8.6% Valuation yield FY16 296.7 Retail: 4 Light Industrial: 1 Office: 1 6.5 WALE (years)³ FY15 210.4 Office: 4 Retail: 1 Includes 1 equity investment & 1 land parcel held for development Calculation based on EPRA vacancy 123 + 1. 2. 3. Weighted by GLA 4. Includes property loans receivable Mauritius SSSS grit#9Strength of Counterparty Successful delivery of hard currency income from multi-national tenants % Rental Contribution to Portfolio by Tenancy Classification ExxonMobil LUX* 15% [VALUE] 5% 43% RESORTS & HOTELS 92.3% multinational tenants¹ 64.5% 35% rental income top 15 tenants ■ Forbes ■ Other Global ■ Pan African ■ National ■ Local 1. Includes Forbes 2000, Other Global & Pan African tenants, weighted by income 19 93.2% income hard currency weighted ave. annualised 3.1% rental escalation Mauritius SHOPRITE SSSS vodacom IMPERIAL game Save money Live better BEACHCOMBER RESORTS & HOTELS BARCLAYS VALE grit#10| 10 Emerging Countries for Comparison Grit Current Investment Jurisdictions Current Investment Jurisdictions Countries Portfolio Moody's Sovereign Rating GDP Growth p.a. since 2010 GDP per Capita (PPP) Population Stability (M) Mozambique 38.1% Caa3 5.9% $1,294 30.3 Botswana Mauritius Ghana 0.3% 72 A2 4.9% $8,168 2.3 22.7% Baa1 3.8% $23,597 1.3 8.9% B3 7.2% $5,026 29.0 Morocco 13.2% Ba1 3.6% $8,956 35.2 Zambia 12.8% Caa1 5.2% $4,119 17.8 Kenya 4.0% B2 5.9% $3,000 48.0 Turkey Ba3 7.4% $25,000 80.0 Nigeria B2 1.5% $5,333 190.9 South Africa China Baa3 0.4% $12,294 56.7 Aa3 6.9% $15,308 1,386.0 India Baa2 6.7% $6,426 1,339.0 Indonesia Baa2 5.1% $11,188 237.4 Source: Trading Economics Mauritius grit#11COUNTRY OVERVIEW#12Why Mauritius? Ability to list in USD on the Mauritius Stock Exchange Pool of liquidity and support from institutional investors in Mauritius Mauritius as a financial hub in the region and gateway to Africa Business-friendly policies and investment-friendly regime 83 Established rule of law and Political Stability Full range of banking services from international providers Competent workforce (27 local staff out of 45 based in Mauritius) ❖ Mauritius benefits from an array of Double Taxation Agreements (DTAs) and generally favourable tax regime Grit currently has stakes in 4 hotels and one commercial building in Mauritius 1st in Africa World Bank Doing Business Survey 2017 2018 Index of Economic Freedom (Heritage Foundation) Economic Freedom of World 2017 (Fraser Institute) World Economic Forum Global Competitiveness Report 2017 - 2018 Mo Ibrahim Index of African Governance 2017 Social Progress Report 2017 Global Information Technology Report 2016 | 12 Mauritius grit#13MAURITIUS (-/Baa1/- *) Country Risk Assessment - Mauritius . KEY DEVELOPMENTS Bank of Mauritius (BOM) is expected to keep its key policy rate of 3.50% throughout 2019, given the subdued inflation currently sitting at 0.5% y/y in Jan 2019 Over the long term, Mauritius' development as a transshipment and finance hub on China's Maritime Silk Road - to be secured by a free trade agreement by early 2019 - will help boost economic growth. Political stability undermined by persistent revelations of corruption, illegal activity or misconduct from leading political figures which could prompt early elections in 2019. As at 31 Dec, tourist arrivals have grown by 4.3 y/y • • • • KEY STRENGTHS Mauritius has had historically a stable political environment Judicial system is regarded as independent Diversified economy; manufacturing and tourism expected to benefit from growth in Asia Good record of attracting investment and business friendly environment Prudent external debt-management and strong payments record. Ample liquidity available in the domestic capital market Double Taxation Avoidance Agreements (DTAAs) and Investment Promotion and Protection Agreements (IPPAs) with many African countries Mauritius is moving towards being a transshipment and financial hub for Sino-African trade, which represents opportunities for Mauritius' long term growth trajectory The country also aims to become a leading tax free shopping destination, auguring for an expansion in the tourism and retail sectors. KEY RISKS The country is also exposed to external shocks through the economy's openness, high dependence on food and fuel import costs, and excessive reliance on volatile export revenues from tourism, sugar and textiles UK and EU growth impacts on Mauritian economy. Should growth lower in those regions, Mauritius is also affected. Increase in external debt and public contingent liabilities Mauritius is particularly prone to imported inflation from high oil and food prices. Both carry a substantial weighting in the CPI basket. "Changes to Mauritius' tax treaty with India and its participation in the 'Convention on Mutual Administrative Assistance in Tax Matters' will weigh on the country's financial sector." Sector Focus: Hospitality ☐ Tourism is the third pillar of the economy and has shown resilience and steady growth in the last few years From 656,450 tourist arrivals in 2000, the country now welcomes c. 1.4m tourists each year Traditional markets such as the EU (+5.6%) has seen sustained growth, while targeted growth markets including China and India are seeing stabilized arrivals Sector focus: Education Growing number of expats on the island and rising middle income have contributed to increased demand for high end school, with international standards The supply in this particular niche has historically been limited given free schooling offered by the State but is now catching up. Tourism Statistics Tourist arrivals Growth of "Accomodation and Food Sevices Activities" sector (%) Tourist arrivals increase over previous year (%) Gross earnings from Tourism (Rs. Mn) Gross earnings per tourist (Rs.) I 13 Source: statsmauritius.govmu.org 2014 1,038,334 2015 Tourism Statistics 2016 2017 1,151,252 1,275,227 1,341,860 2018 1,399,287 6 5 9 11 9 11 5 5 4 4 44,304 50,191 55,867 60,262 64,000 42,668 43.597 43,809 44,909 45,878 Mauritius SSSS grit#14PORTFOLIO OVERVIEW#15Canonnier Golf Resort & Spa 15 Location: Sector: Property Yield: GLA: Rental per m²: Vacancy: WALE: Pointe aux Canonniers Hospitality 7.5% 25,248m² $16.18 0% 13 years Escalation: Current Valuation: Anchor Tenant: 1.7% US$25.5 million Beachcomber Mauritius grit#16Mauricia Resort & Spa | 16 Location: Sector: Property Yield: GLA: Rental per m²: Vacancy: WALE: Grand Baie Hospitality 7.5% 23,266m² $11.92 0% 13 years Escalation: Current Valuation: Anchor Tenant: 1.7% US$23.5 million Beachcomber Mauritius grit#17Victoria Resort & Spa I 17 Location: Sector: Property Yield: GLA: Rental per m²: Vacancy: WALE: Pointe aux Piments Hospitality 7.5% 41,696m² $14.52 0% 13 years Escalation: Current Valuation: Anchor Tenant: 1.7% US$42.1 million Beachcomber Mauritius grit#18| 18 Tamassa Resort 7 Location: Sector: Property Yield: GLA: Rental per m²: Vacancy: Bel Ombre Hospitality 7.5% 21,567m² $13.34 0% WALE: 8 years Escalation: Current Valuation: 0% US$52.2 million Anchor Tenant: LUX* Mauritius grit#19I 19 Barclays House BARCLAYS Location: Sector: Property Yield: GLA: Rental per m²: Vacancy: WALE: Escalation: Cybercity Ebène Office 7.6% 8,269m² $11.81 4.6% 8 years 5% BARCLAYS Current Valuation: Anchor Tenant: US$15.6 million Barclays Mauritius grit#20Thank you Grit Real Estate Income Group Reg. No. C128881 3rd floor, La Croisette Shopping Centre, Grand Baie 30517, Mauritius Level 3, Alexander House, 35 Cybercity Ebene 72201, Mauritius T +230 269 7090 E [email protected]#21Disclaimer This report has been issued and approved for use by you solely for your information and should not be considered to be an offer or solicitation of an offer to buy or sell or subscribe for any securities, financial instruments or any rights attaching to such securities or financial instruments. This report is intended for use by professional and business investors only. The information and opinions have been compiled from reliable sources but neither Grit Real Estate Income Group ("Grit"), nor its directors, officers or employees accepts any liability for loss arising from the use of this information or the accuracy of it. Any forecasts, opinions or estimates constitute opinions given at the date of this report only. There can be no reliance on the fact that future results or events will be consistent with past performances, these results, opinions or forecasts or estimates. The past performance and opinions and estimates given in this report, express or implied, should not be seen as a guarantee of future performance. This report is subject to change and its accuracy is not guaranteed. The value of securities can rise or fall depending on currency exchange fluctuations which can affect the value positively or negatively. Investors should seek professional advice of whether to invest in the securities discussed in this report. Grit securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the "Securities Act"), and may not be offered or sold, directly or indirectly, in the United States of America, unless they have been registered under the Act or the investor has exemption from the Securities Act. Grit does not intend to register its securities under the Securities Act or to conduct a public offering of the securities in the United States of America. Should securities be offered in the future, in the United States of America, any offering of securities will be made only to qualified institutional buyers in accordance with Rule 144 A under the Securities Act or in other transactions exempt from, or not subject to, the registration requirements of the Securities Act and applicable state or local securities laws. Outside the United States of America, any future offering of securities will be made in accordance with applicable regulations and under securities legislation. In member states of the European Economic Area ("EEA") which have implemented the Prospectus Directive (each, a "Relevant Member State"), this presentation is directed exclusively at persons who are qualified investors within the meaning of the Prospectus Directive ("Qualified Investors"). For these purposes, the expression Prospectus Directive means Directive 2003/71/ EC (and amendments thereto, including Directive 2010/73/EU, to the extent implemented in a Relevant Member State), and includes any relevant implementing measure in the Relevant Member State. In the United Kingdom this presentation is only being distributed to, and is only directed at, Qualified Investors who are (i) investment professionals falling within Article 19(5) of the UK Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the "Order"); or (ii) high net worth entities falling within Article 49(2)(a) to (d) of the Order, or (iii) other persons to whom it may otherwise be lawfully communicated (all such persons together being referred to as "relevant persons"). Persons who do not fall within the category of relevant persons should not take any action on the basis of this presentation and should not act or rely on it. 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