Managing the Defence property portfolio – now and into the future Peter Howman, Managing Director

Agenda

•  Current  projects  and  opportuni0es  for  industry  

•  ADF  housing  demand  vs.  supply  

•  Investment  management  

DHA was established in 1988

•  DHA’s  main  role  is  to  provide  housing  and  related  

services  to  ADF  members  and  their  families  

•  Shareholder  Ministers  are  the  Minister  for  

Defence  and  the  Minister  for  Finance  and  

Deregula0on  

•  DHA  is  a  GBE  

•  DHA  pays  taxes  and  dividends  

•  2012-­‐13  revenues  exceeded  $1  billion  

•  Managed  property  porLolio  valued  at  $10  billion  

Where we came from

Where we came from

National projects - locations

Seaward  Village  

Overall housing stock

Apart from major changes to bases and unit locations, the overall ADF demand for DHA housing is relatively static.

DHA housing construction/purchase demands arise largely from four sources:

•  replacement of disposed stock •  replacement of SLB properties at end of

lease •  construction to meet changed ADF demand,

and •  new product for the singles market.

Breezes Muirhead

AE2 Ermington

Bluewattle Townsville

•  Member  of  Urban  Design  Ins0tute  of  Australia  

•  Member  of  the  Real  Estate  Ins0tute  of  Australia  

•  Sponsored  20  Appren0ceships  na0onwide  through:  

–  Master  Builders  Group  Training  –  Housing  Ins0tute  of  Australia  Group  

Appren0ceship  Scheme  

–  Group  Training  NT  –  TORGAS  

Industry Connections

Contractor management

•  The  defini0on  of  small,  medium  and  large  business:    –  small  business:  employing  fewer  than  20  people  

–  medium  business:  employing  20  or  more  people,  but  fewer  than  200  people    

–  large  business:  employing  200  or  more  people.  

Division Small  and  Medium  Size  Contractors

Large  Contractors

Property  and  Tenancy  Services

943 5

Sales  and  Marke<ng 130 1

Property  Provisioning  Group  (Development  and  Construc<on)

253 57

Air  Condi0oning Garage  Door Pool

Alarm  Security Gas Screens

Asbestos Glazing Smoke  Alarm  Maintenance

Blind  Cleaning Grounds  Maintenance Sprinkler

Cabinet  Maker Gu^er  Cleaning Tiling

Carpentry Hea0ng Tiling  Roof

Carpentry Hot  Water  Systems Tree  Surgery

Cleaning Landscaping TV  Antennas

Concre0ng Locksmith Water  Tanks

Electrical Pain0ng Waterproofing

Fencing Pest  Control Window  Furnishing

Floor  Covering Plasterer

Floor  Covering  Cleaning Plumbing

RMS Panel Services

Services included in the Repairs and Maintenance Panel

DHA  sells  proper<es  to  private  investors  

Private  investor  leases    property  back  to  DHA  

DHA  uses  property  to  house  Defence  families  

Investment management model

Why sale and leaseback works

Lease agreement

• Long-term lease and flexibility to extend or reduce to meet our Defence housing obligation

• Investors receive rental income that is backed by the Australian Government

• We maintain control through an all-inclusive property management service, including repairs and maintenance

DHA today

•  Has  transformed  Defence  housing  into  a  $10b+  na0onal  porLolio:  –  manage  over  18,500  proper0es  Australia-­‐wide  

–  manage  almost  13,000  proper0es  on  behalf  of  private  investors  

–  provide  modern,  liveable  dwellings  (average  age  =  9  years)  

–  have  adequate  private  funding  to  maintain  dwellings  at  the  highest  standards  (to  value  of  $60m  in  R&M  p.a.)  

•  Is  a  high  performing,  full  tax  paying  Government  Business  Enterprise  

•  Provides  significant  shareholder  returns,  with  revenues  generated  through  our  proven  private  capital  raising  program  

•  Is  now  also  an  award-­‐winning  and  sustainable    residen0al  developer,  with  $1.3b  worth  of  developments  underway  and  a  further  $1b+  in  the  pipeline  

Any  ques0ons?