PORTFOLIO INITIATIVES

Engaging our tenants

As one of the largest property groups in Australia, we provide property services to approximately 5,000 tenants primarily major corporate and government organisations. In the last year, we have implemented a number of initiatives to further enhance the relationship we have with our tenants.

Portfolio wide initiatives

DEXUS tenant surveys

For the last two years we have conducted annual tenant surveys in our office and industrial portfolios and in 2008 ran our first national retailer survey. Our aim is to gain a greater depth of understanding of our tenants’ needs so we can continue to improve our service delivery and ensure our properties meet the needs of our tenants, now and in the future.

The surveys enable tenants to provide feedback and rate their level of satisfaction in relation to key areas such as property maintenance, building management, communications and sustainability. To encourage participation in the survey, we make a donation of $25 to our "People’s Choice" charity for each survey completed – this year donations went to the Royal Flying Doctor Service.

Service excellence

Consistent with our commitment to delivering service excellence to our tenants, we have sought to enhance the quality of our customer service over the past year with new initiatives in tenant engagement and the management of our suppliers.

In 2009/10 our office tenant surveys will be undertaken by an external provider to enable more effective benchmarking with industry standards and ultimately enable further improvements in our service delivery.

Currently, in our supply agreements we require our contractors and service providers to confirm their commitment to the principles of fair contracting. In 2009/10 this will be expanded to include key performance indicators in delivering service excellence and sustainability performance, which will then be integrated into our procurement procedures.

Office portfolio initiatives

Across our office portfolio, we introduced a new engagement program, where our property and portfolio management teams annually prepare a tenant communication plan for each building, mapping opportunities for regular tenant liaison. This is tailored to the property and the individual tenant needs. The office property management teams also conduct regular tenant meetings and we produce tenant newsletters, which further enhance communications.

In addition, for the second year running, we engaged with our tenants to gather additional feedback on our services, properties and facilities through the DEXUS tenant survey.

As in the first year survey, office tenants rated sustainability as important to their company. Tenants rated resource efficiency programs and the use of environmentally friendly materials as “important” to “very important” and responded favourably when asked whether they would like further information and support on environmental sustainability initiatives in their tenancies.

Over the last 12 months, we established a number of Green Building Committees which include building tenants, so that we can further engage with our tenants on sustainability and drive increased sustainability performance. In addition, we provide sustainability updates in tenant newsletters.

In May 2009 we completed the internalisation of property management in our office portfolio, with the objective of improving the quality of service offered to our tenants and enhancing operating efficiencies by bringing full management of our properties in-house.

This is consistent with our integrated property management model which we believe gives us greater connectivity with our tenants and the ability to create greater value.

Industrial portfolio initiatives

The internalisation of the property management of our industrial portfolio in Victoria is currently underway, expanding our team in Victoria, with New South Wales to follow later in 2009.

Tenant surveys were also conducted in our industrial portfolio for the second year running, where the average rating for the importance of Environmental Sustainability remained high (rated between “important” and “very important”).

Retail portfolio initiatives

Tenant engagement in our retail sector continues at both a centre and portfolio level. We hold regular retailer meetings and produce centre newsletters to ensure that retailers are fully briefed on all activities and opportunities in the centres. We also work with consultants to ensure our programs are best practice and add value to both our retailers and customers, as well as our business.

In October 2008, we launched our first national retailer survey. The results of this annual survey were encouraging, with many of the highest scores relating to sustainability, such as the importance of waste management, recycling programs and energy efficient programs and the importance of the use of environmentally-friendly materials.

During the year we developed a new values and reward program for retailer performance – the DEXUS S.T.A.M.P awards. These will be launched later in 2009 and aim to reward performance in the following areas:

S - Sales

T – Trading hours

A – Administration (sales remittance and timely payment of rent)

M – Marketing participation

P – Presentation

Industry engagement

In the property industry we play an active role through the Property Council of Australia (PCA) to contribute to the development of our sector, including engaging through the PCA at all levels of government on policy issues. We also seek to work collaboratively with the sector to promote the CR&S capability of the property industry.

Our employees are members of more than 30 organisations across relevant industry and professional sectors, including:

• Property Council of Australia
• Green Building Council of Australia
• Australian Property Institute
• Facilities Management Association of Australia
• Property Management Institute
• Shopping Centre Council of Australia
• Royal Institute of Chartered Surveyors
• Australian Society of Certified Practising Accountants
• Financial Services Institute of Australia
• Institute of Chartered Accountants
• Australian Marketing Institute
• Chartered Institute of Building Services Engineers
• Australian Compliance Institute
• Chartered Securities Association

Several members of DEXUS also hold senior positions on industry bodies and committees as well as participating in professional development programs by presenting at industry courses. For Example:

• Immediate Past President, PCA
• Board Member, PCA
• Chair, PCA Audit Committee
• Chair, PCA Risk Committee
• Member, PCA Property Investment and Finance Advisory Committee
• API President's Appointment Committee
• Director, Shopping Centre Council of Australia
• Advisory Member, Shopping Centre Council of Australia
• Member, PCA Industrial Committee
• Member, PCA National Sustainability Round Table

Government engagement

In the course of doing business we engage with government at a local, state and federal level, for example, through consultation in the development process and through participation with our industry body the PCA.

We have strict rules regarding the payment or acceptance of gifts or benefits to and from third parties, as set out in our Gifts, Benefits and Entertainment Compliance Policy. This policy prohibits financial or in-kind contributions to political parties and politicians. No gifts, benefits or donations were made to political parties or politicians in 2008/09.

All employees are required to conduct themselves in an appropriate manner that does not bring the Group’s reputation into disrepute. In 2009/10 we will develop a formal policy on participation in public policy development and lobbying.