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NZX announcement - 29 March 2021 Precinct Internalisation Agreement The Independent Directors of Precinct Properties New Zealand Limited ( " Precinct " ) ( NZX : PCT ) are pleased to announce today that they have reached an agreement with the Manager , AMP Haumi Management Limited ( “ AHML " ) , to terminate the Management Services Agreement and internalise the management of Precinct . The transaction is expected to provide cost savings of $ 14.6 million per annum and be 6.0 % ¹ accretive to adjusted funds from operations ( AFFO ) per share on a pro forma basis which assumes that current development projects are complete . Importantly , Precinct will retain key management personnel and the transaction positions Precinct to deliver on the next phase of its strategy . Craig Stobo , Independent Chairman of Precinct said " Since listing in 1997 Precinct has continued to evolve through a changing market , to become one of New Zealand's leading listed property businesses today . AHML has helped create significant shareholder value for Precinct shareholders as we have transformed the quality of this business over the past 10 years . The shareholders of AHML have a global perspective of real estate markets and their influence is evident in the successful completion of over $ 1.5bn in developments in that time . We are delighted that we have been able to agree terms with AHML to internalise the management of Precinct . The independent directors believe that internalisation will best position Precinct for future growth and is an appropriate progression considering the scale and breadth of Precinct's business . The internalisation will ensure the retention of key staff , the continuity of Precinct's successful strategy and ongoing stable shareholder returns . " Key terms of the transaction include : ● Precinct ● A gross payment from Precinct to AHML of $ 215m . As a result of this transaction , $ 10m of fees on current development projects are no longer required to be paid . ¹ Assuming the net cost to Precinct of $ 145m is funded via debt . Accretion of 3.3 % based on PCT's WACC . Precinct Properties New Zealand Limited E hello@precinct.co.nz W www.precinct.co.nz Head Office Level 12 , 188 Quay Street , Auckland 1010 PO Box 5140 , Auckland 1141 , New Zealand T 0800 400 599 Wellington Office Level 19 , 157 Lambton Quay , Wellington T 0800 400 599 PO Box 2 , Wellington 6140 , New Zealand