Olav Thon Eiendomsselskap. Arne B. Sperre Executive Vice President Finance

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1 Olav Thon Eiendomsselskap Arne B. Sperre Executive Vice President Finance Oslo, September 20, 2018

2 Agenda Olav Thon Eiendomsselskap Investment strategy Business area and it s property portfolio Key financials Projects under development Trends Macroeconomics Changes in the retail trade industry Online shopping Shopping centers in change

3 Olav Thon Group OLAV THON FOUNDATION 100% OLAV THON GRUPPEN AS 100% 72% THON HOLDING AS OLAV THON EIENDOMSSELSKAP ASA OLAV THON

4 Olav Thon Foundation The objectives: To exercise a stable and long-term Norwegian ownership of the Olav Thon Group To award funds to public benefit purposes: up to NOK 50 mill. Each year Non profit purposes The largest foundation in Norway Capital above NOK 25 billion Owner of Olav Thon Group since 2013 The Olav Thon prizes Yearly award International and national prizes for medical and natural scientific research (About MNOK 40)

5 Olav Thon Group Norway s leading company in real estate and hotel business Largest shopping center owner in Norway and Sweden Thon Hotels => Norway s 3 largest hotel chain Olav Thon => Living legend => «A Norwegian folk tale»

6 Investment Strategy OTE ASA «Acquire, Develop, Own» Mainly investments in projects under construction and property purchases Investments : MNOK

7 Olav Thon Eiendomsselskap Highlights Listed on the Oslo Stock Exchange since 1983 The Market Cap. has increased from MNOK 200 to MNOK ( ) Average annual return from 1983 about 13,5% 2018: Norway s leading shopping center player focus on the largest shopping centres 5 of Norway s 6 largest Key figures 1H2018 Profit before tax: MNOK (Fair value adjustments : MNOK 535 Profit before tax and fair value adjustments increased by 9 % to MNOK

8 Financial results ,000 4,000 3,000 2,000 1,000 Profit before taxes ,000 1,800 1,600 1,400 1,200 1, Profit before taxes and fair value adjustments : Annual growth: 10 % 1H -18: Growth from 1H-2017: 9%

9 Share performance OLT from June 2013: + 66% OSEBX from 2013: +109% Decline from ATH: - 15%

10 Financing During 1H the average interest rate increased from 2,98% to 3,04% Short-term interest rates +/- 1% => The average interest rate => +/- 0,5% Long-term interest rates +/- 1% => Market value of FI => +/- MNOK

11 Founding sources ( ) = Bank loans = Bond loans = Commercial papers The Scandinavian Capital Markets provides 65% of the funding (49% Norway, 16% Sweden) Interest-bearing debt: MNOK

12 Portpolio of properties

13 Portpolio of properties ( ) 140 Properties => Market value: MNOK Average net yield => 5,17% Retail property => 81% Yearly rental income => MNOK Rental distribution => Norway 91%, Sweden 9% 4.00% Vacancy 3.50% 3.00% 2.50% 2.00% 1.50% 1.00% 01/01/ /01/ /01/ /01/ /01/ /01/ /01/ /01/2018

14 Portpolio of shopping centres ( ) 90 shopping centres Norway: 85 (incl. 22 under management) Sweden: 5 Market value (incl. JV) : MNOK Retail sales in owned centres: 1H-2018: MNOK (+1,8%) => Like-for-like => + 2,0%

15 Shopping center player No. 1 in Norway NORWAYS 20 LARGEST SHOPPING CENTRES IN FIRST HALF 2018 Ranking Shopping Centre Place Sales (ex. VAT) Change in % 1 Sandvika Storsenter Sandvika ,6 2 Strømmen Storsenter Strømmen ,4 3 Lagunen Storsenter Bergen ,1 4 Amfi Moa Ålesund ,8 5 Storo Storsenter Oslo ,0 6 Sørlandssenteret Kristiansand ,1 7 CC Vest Oslo ,9 8 Sartor Storsenter Straume ,8 9 Kvadrat Sandnes ,5 10 Ski Storsenter Ski ,9 11 City Lade Trondheim ,8 12 Bydel Aker Brygge Oslo ,5 13 Alna Senter Oslo ,5 14 Oslo City Oslo ,4 15 City Nord Bodø ,8 16 Jekta Storsenter Tromsø ,5 17 Jessheim Storsenter Jessheim ,2 18 City Syd Trondheim ,8 19 Åsane Storsenter Bergen ,6 20 Vestkanten Storsenter Bergen ,3 Norways 20 largest shopping centres ,0 % Yellow = owned by the Group Green = managed by the Group Grey = owned by sister company

16 «Commercial properties» ( ) 50 «commercial properties» in Oslo area (excl. Shopping centres) Market value: MNOK Retail, offices and 3 hotel properties Market value of the 5 largest: MNOK Some famous landmarks in Oslo

17 Investments ,500 Investments 4,000 3,500 3,000 2,500 2,000 1,500 1, Investments in 1H-2018: MNOK 700

18 Property projects 5 larger projects under construction Projects to adjust the shopping centres to the digitalisation of retailing and to develop the services offered at the centres (cinemas etc.) sq.m. rentable spaces and parking spaces To be completed in 2018 and 2019 Several larger projects in the planning phase

19 Macroeconomics Norwegian macroeconomics is important Interest rates => Directly and indirectly The consumer spending => Indirectly Exchange rates => Directly and indirectly

20 Changes in the retail trade industry Nordic retail survey 2018 (Media Agency IUM) Status: Consumers no longer need to visit the physical store to shop «Web-rooming» => 38% of the customers, increases moderately «Show-rooming» => Stable low share: 3% «The analog consumer» => 39% of the customers, falling trend

21 Online shopping «Online shopping has become shopping» = Death of the malls? 90% of Scandinavians over 18 years shop «regularly» online Online Shopping makes up about 6% of the total store sales in Norway. (Assess challenges) Purchases of travel and hotel rooms account for about 55% of the online shopping in Norway. Opportunities for the Shopping centres: => The retailers can communicate effectively with shoppers => Pick-up point for the online shopping in the shopping centres

22 Online shopping China and US «Physical stores serve an indispensable role during the consumer journey and should be enhanced through data-driven technology and personalized services in the digital economy» Daniel Zhang CEO Alibaba Group

23 Shopping centers in change developement trends 1) Mall functions are further developed => Meeting points for shopping, services and experience 2) Digital development in the retail trade industry => Web-rooming, Show-rooming, Robotics, «Mobile mirror», ++ 3) Payment Gateways => New and simpler Payment Gateways => Vipps, Apple, Samsung,+ 4) Omni Channel => The stores must offer more sales channels => Physical shops, Online shopping and combinations 5) Service points => New and better service points => «Click and collect», «Pick up points» => The role of the store is changing => Meeting point for inspiration ++

24 Changes in the tenant mix «In the good old days» Post office Bank Traveling agency CD shop Photoshop Rental of video Rental of TV/appliances Bingo «Today» More service and experience oriented New business concepts Exotic food courts Cinema Fitness gym Bowling Health and wellness Pick up points/shops with storage The shopping malls change over time as trends in consumer behavior and demand for goods, services and experiences change

25 Disclaimer The information included in this Presentation contains certain forward-looking statements that address activities, events or developments that Olav Thon Eiendomsselskap ASA ( the company ) expects, projects, believes or anticipates will or may occur in the future. These statements are based on various assumptions made by the Company, which are beyond its control and are subject to certain additional risks and uncertainties. The Company is subject to a large number of risk factors including but not limited to economic and market conditions in the geographic areas and markets in which Olav Thon Eiendomsselskap is or will be operating, counterpart risk, interest rates, access to financing, fluctuations in currency exchange rates, and changes in governmental regulations. For a further description of other relevant risk factors we refer to the Annual Report for 2017 for Olav Thon Eiendomsselskap. As a result of these and other risk factors, actual events and our actual results may differ materially from those indicated in or implied by such forward-looking statements. The reservation is also made that inaccuracies or mistakes may occur in the information given above about current status of the Company or its business. Any reliance on the information above is at the risk of the reader, and Olav Thon Eiendomsselskap disclaims any and all liability in this respect. Olav Thon Eiendomsselskap ASA P.O. Box 489, Sentrum 0105 Oslo Norway Tel: Contact info: Arne B. Sperre Executive Vice President - Finance arneb.sperre@olavthon.no Tel: