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BWP Trust

Level 11 Wesfarmers House, 40 The Esplanade, PERTH WA 6000

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Homeware and Appliances - Perth, WA

BWP Trust is a real estate investment trust listed on the Australian Securities Exchange (“ASX”) investing in and managing commercial properties throughout Australia.

The Trust owns 80 Bunnings Warehouses, eight of which have adjacent retail showrooms that the Trust owns and are leased to other retailers, one Bunnings Warehouse sub let to Super A-mart, a standalone showroom property and two industrial properties leased to tenants for manufacturing, storing and distributing goods and services.

The Trust’s main source of income is the rent paid by Bunnings and other tenants for leasing their respective premises from the Trust. Rent is generally based on the area of the property leased by the tenant, and typically does not have reference to the tenant’s turnover at the premises. Growth in rental income typically comes from acquiring additional leased properties and from increases in rent from existing properties. Rents from existing properties grow as a result of annual incremental rent increases and periodic market reviews in accordance with the lease. Rental growth may also occur when there are upgrades to existing properties, which increase the lettable area.

The main items of expense for the Trust are borrowing costs and the fee paid to the responsible entity for managing the Trust. The amount of borrowing costs will be determined by the level of borrowings the Trust has from time to time, and the interest rates and bank costs associated with those borrowings. The level of management fee paid by the Trust depends on the value of the gross assets of the Trust over the period.

The Trust’s assets are predominantly comprised of its investment properties. Investment properties are revalued each six months to assess their fair value based on market conditions and the circumstances of each particular property. Changes in the fair value of properties as a result of revaluations are recorded as an unrealised revaluation gain or loss for the period and do not affect distributable profit. Borrowings to fund investment in properties are the Trust’s largest liability and typically represent 20 to 30 per cent of the value of the Trust’s total assets.

As required by the Trust’s constitution, the Trust distributes all its net profit each six months, excluding unrealised movements in the fair value of investment properties.

The Trust is managed by an external responsible entity, BWP Management Limited (“the responsible entity”) which is appointed under the Trust’s constitution and operates under an Australian Financial Services Licence.

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