BoKlok the very short version...A concept for affordable housing 50/50 Cooperation with IKEA on...

Jonas SpangenbergStanford 23/02/2017

BoKlokthe very

short version

§ A concept for affordable housing

§ 50/50 Cooperation with IKEA on concept level.

§ 100% Skanska operation on business level

§ 20 year anniversary 2016§ Specialized unit established

2010 with full responsibility for all BoKlok business including construction

§ Acts in whole value chain from business development to construction on site with own production facility

Melker Schörling & Ingvar Kamprad at the grand inauguration of the first BoKlok-project in Ödåkra 1997

Basic facts

Speed (10-12 months from sale start to handing over)§ Short lead times,

uncomplicated land§ High turnover rate in land

bank, >50% options§ High capital turnover rate,

target >2 times per year

Predictability§ Industrialized process§ Few subcontractors and close

cooperation with CS

Low cost§ Volumes§ Limited product portfolio and

customization

Attractive return for

the owners (margin &

ROCE)

Truly proud employees

Highly satisfied

customers

Key success factors

Volume development 2011-2020 (# sold homes)

CAGR (11-16):Volume: 24%Earnings: 53%

CAGR (16-20):Volume: 13%Earnings: 13%

0

500

1,000

1,500

2,000

2,500

2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

Actuals 2011-2016

BP 2011-2020

Best case 2017-2020

1. Continue the BoKlok formula; – small scale projects in the affordable

residential segment – highly standardized and industrialized

processes, controlling the whole value chain

– high capital turnover rate (>2,0) 2. Growth in Sweden, establish solid

footprint in the capital areas in Finland & Norway

3. Transform BoKlok into the obvious sustainable offer for the many people

Current focus

A NEW MULTIFAMILY-HOUSING SOLUTION

FernandoBarcenasVPofConstruction

Involved with industrializedconstruction for over 25 yearsholding positions at OutinordUniversal, Western Forms, amongothers. Via his company wasresponsible for the industrializedproduction of over 125,000 housingunits. B.S. in Architecture from UAG.

HugoMedinaVPofRealEstate

Extensive experience in multifamilyreal estate investments, holdingpositions in real estate privateequity and capital markets in NewYork. Master’s in Real Estate fromCornell University.

CuauhtémocPérezExecutiveDirector

Prior to starting hi:hab, was abusiness consultant at the BostonConsulting Group. Also held variouspositions in real estate developmentand urban planning in the largesthomebuilding company in Mexico.MBA from Stanford.

Executive Summary (I / III)

ABOUTUS

hi:hab designsandsupplieslow-costmultifamilybuildingsdirectlytocustomersunderasubscriptionmodel.Thebuildingsarefullyremovableandarehostedinurbanlotsnotforsale,usingafixed-termlease.

THEOPPORTUNITY

Thereisalargeaffordabilityproblemintherentalindustrythathasledtorentersspendingover50%oftheirincomeonrentinmajorcities.

Thereisavastamountofunderutilizedlotslocatedinurbancoresthatcouldbebetterutilizedforthedevelopmentofmultifamilyrentalbuildings.InUScitieswithpopulationsover250k,15%oflandareaconsistsofvacantlandtypicallynotforsale.

Byapplyingtechnology, hi:hab aimstoprovidecustomerswithaccesstotheirmostdesiredlocationsthatwerepreviouslyunavailable.

OURREVENUEMODEL

SupplyFee18%marginonbldg.materials

hi:hab providesinvestorswiththeprojectplan&thebuildingkitdirectlyfromourfactorysuppliers.

Executive Summary (II / III)

OURTECHNOLOGY

Wehaveengineeredabuildingsystemthatallowsustobuildlow-cost,high-qualitymultifamilybuildingsthatcanbeinstalledorremovedin30days.Thisallowsforanewwayofacquiringlandformultifamily:fixed-term RevenueShareAgreements(RSAs)

RSAs arealignedtotheneedsofurbanlotowners:maintainownershiptocaptureappreciation,getoutsizedmonthlyincomeandkeepalloptionsopenuponterminationofagreement.

SalesFee8%feeonmonthlygrosssales

Wecollectmonthlysubscriptionsfromcustomers.Wesupportlandlordsinservingourcustomersthroughanintegratedsuiteofoutsourcedapps.

Executive Summary (III / III)

HOWDOESAHI:HABBUILDINGFAREVS.ALTERNATIVES

LOTOWNER(in-network)

BUILDINGINVESTOR(in-network)

CUSTOMERS(subscribers)

MexicoCityCaseStudy:TopNeighborhood

2-4xnetrevenueMX$3,000/m2/yr compared toMX$670-1,300/m2/yr for aparkinglot lease (depends on location fortraffic flow)

>1.6x netrevenue

3Xyield on cost

MX$4,150/m2/yr compared toMX$2,650/m2/yr rent income

30%YOC vs.10%(30%savings onhard costs /1.6xrevenue)

<30%disposableincome

50%ofav.marketticket

Pricestarting@MX$4k/mo vs.$8k(shared,oldapt.)Targettop80%ofprofessionalworkforce,vs.top20%.

hi:hab’s supply chain

3.SIPSystemforFloors

4.BoardsforInteriorWalls

5.Fixedfurniture

6.Plumbing&Electrical

7.RollUpWindows&Doors

2.InsulatedMetalPanelsforRoof&ExteriorWalls

1.SteelBeamStructure

SpecializedSteelBuildingSubcontractor

SpecializedSubcontractors

TERNIUM(SteelGlobalConglomerate)

CustomOSBBoards

GAVIOTA/DICKSON

VariousFixtures

VIEGA DURMAN

Manufacturing(National)BuildingSystems SiteInstallation(LocalGCs)

BLSSYSTEMS(Chinese/Canadian)

VALSAPANEL

SpecializedPrefabInteriorsSubcontractors

Planned construction schedule

STEELBEAMSTRUCTUREASSEMBLYDAY1


PLANTABAJA

PLANTAPRIMERYTERCERNIVEL

PLANTASEGUNDONIVEL

FACHADAFRONTAL

FACHADALATERAL1

FACHADALATERAL2

SECCION

MODELOESTRUCTURAL1

DISEÑOSCONEXIONES

VISTATRIDIMENSIONALESTRUCTURA

PLANTAESTRUCTURA

SECCIONTRANSVERSAL

SECCIONLONGITUDINAL

ESTRUCTURADEACEROVISTA1

PROPUESTADECONEXIONESTIPONODO

BoKlok the very short version...A concept for affordable housing 50/50 Cooperation with IKEA on...

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