MAY PETE GLADWELL Head of Public Sector Partnerships 10 October 2013 INVESTMENT IN REGENERATION: Aligning Long Term Investment with Long Term Social Need LEGAL & GENERAL. APRIL 2015 EVERY DAY MATTERS

2 2 LEGAL & GENERAL GROUP PLC Long term direct investments Direct investment programme, with £5.7 billion invested to date "L&G's decision to launch a £15 billion regeneration vehicle and invest £1.5 billion is fantastic news and a vote of confidence in the UK economy and our regional cities.“ Greg Clark Minister for Cities £15bn Places for people: £252m, acquiring 4,000 homes, building 7,000 houses, 50 year lease Thames Valley Housing: £40m, 25 year facility enabling 500 affordable homes Royal Liverpool University Hospital: £429m rebuild English Cities Fund schemes in Liverpool, Plymouth, Canning Town, Salford and Wakefield: over 5.4m sq ft of mixed-use space, brownfield land Transport and Logistics: £320m, maturities to 30 years Aberdeen international business park: £127m investment, 335,000sq ft office space CALA Homes: £210m investment (47% stake), further £200m for Banner Homes Hyde Housing Group: £102m investment 15 year facility Sentinel Housing: private placement (registered social housing provider in Hampshire) University of Southampton: £93m, 1,104 beds, 40 years income Methodist Care Homes: £70m investment, 30 year lease

3 3 LEGAL & GENERAL GROUP PLC University of Hertfordshire £145m, and equity investment Inflation linked leases Slow Money Creating a slow money asset class: student accommodation. Imperial College, Clapham £116m, 566 postgraduate studio rooms Inflation linked leases University of Southampton £93m, 1,104 beds Inflation linked leases Unite Group £121m, 10 year facility £149m, 9 year facility University of Greenwich £43m, 358 beds Inflation linked leases University of Arts, London £58m, 475 beds Inflation linked leases 50 year financing 43 year financing 40 year financing 37 year financing 28 year financing

4 4 LEGAL & GENERAL GROUP PLC Hyde Housing Group £102m, Methodist Care Homes £70m long term RPI RPI linked financing. Ideal Carehomes - £51m. 10 year debt facility Inflation linked lease Royal Liverpool £89m £252m investment Acquiring 4,000 homes Building 7,000 houses Inflation linked lease to Thames Valley Housing Association (£40m) For NHS key workers 15-year facility 32 year long term funding 50 year investment (30 year) 25 year financing Tesco distribution hub at Reading £120m. 25 year lease term Next distribution hub £86.7m. 25 year lease term Waitrose distribution hub in Milton Keynes for £114m. 30 year lease term Funded 100% of capital req’d More Slow Money Direct investment examples

5 5 LEGAL & GENERAL GROUP PLC English Cities Fund (ECF) Salford Development Agreement signed with Salford Council. Planning Consent for 40 acres £50m invested in 2014 Plymouth Partnership with Plymouth City Council and HCA. Outline consent 2.13m sq ft mixed use. Canning Town Partnership with Newham Council, HCA and LTGDC. 3 phases of development 406,00 sq ft residential led mixed used scheme Wakefield Partnership with Council and Network Rail Consent achieved for 704,000 sq ft Liverpool Multi phase development 373,000 sq ft Offices, 50 Apartments,

6 6 LEGAL & GENERAL GROUP PLC Slow Money: Media City, Salford Investment in a £500m Development Part of our £5.7bn Direct Investments Illiquidity boosts risk-adjusted returns

7 7 LEGAL & GENERAL GROUP PLC Collaborative approach needed for creative problem-solving 1.Government to implement Lyons and Armitt to tackle infrastructure and housing shortages 2.Need for new models that go beyond the classic “20% IRR” developer model 3.New level of shared Trust and Ambition between Public and Private Sector Partners “The significant problems that we have created cannot be solved at the level of thinking we were at when we created them.” – Albert Einstein