Covivio Sa · EURONEXT:COV
Covivio Sa — Investor Day (December 2022)
131 slides from Covivio Sa's investor day presentation, Dec 6, 2022
Slide 1: Capital Markets Day December 6th 2022
Build sustainable relationships and well-being The Westin Grand - Berlin Uhland - Berlin CAPITAL MARKETS DAY DECEMBER 6TH 2022 Goujon - Paris Corte Italia - Milan
Slide 2: Welcome to Berlin, #1 city in Covivio's portfolio
WELCOME TO BERLIN, #1 CITY IN COVIVIO’S PORTFOLIO Residential – Uhland Residential – Kudamm Hotels – Park Inn Alexanderplatz 84% RESIDENTIAL 18,000 units, mostly Altbau buildings in the city center Residential – Königstraße 60 Residential – Nollendorfstrasse €3.7BN Group Share portfolio in Berlin, G
Slide 3: Agenda
AGENDA I. WELL PREPARED FOR A CHALLENGING 4 ENVIRONMENT II. ESG: ON TRACK WITH OUR OBJECTIVES 26 III. CBRE PRESENTATION ON GERMAN RESIDENTIAL 38 IV. UPDATE ON OUR 3 ASSET CLASSES 39 GERMAN RESIDENTIAL: A PRIME PORTFOLIO WITH GROWTH DRIVERS 40 OFFICES: A SUCCESSFUL STRATEGY 71 HOTELS: PERFORMANCES AB
Slide 4: I. Well prepared for a challenging environment
I. WELL PREPARED FOR A CHALLENGING ENVIRONMENT 21 Goujon - Paris
Slide 5: I. Well prepared for a challenging environment
I. WELL PREPARED FOR A CHALLENGING ENVIRONMENT I.1. A HIGH-QUALITY DIVERSIFIED PORTFOLIO I.2. STRATEGY ADJUSTMENTS TO THE NEW ENVIRONMENT I.3. DISCIPLINE DEBT MANAGEMENT TO MAINTAIN A HEALTHY BALANCE SHEET 21 Goujon - Paris
Slide 6: A diversified specialist
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… A DIVERSIFIED SPECIALIST A EUROPEAN PORTFOLIO A DIVERSIFIED REIT 55% 30% 15% 37% 42% Offices in France, Residential Hotels France Germany Italy & Germany in Germany in Europe ~1.4M ~41,300 ~44,700 €17.8BN m² of offices units Hotel room
Slide 7: Our strategic pillars are more than ever relevant
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… OUR 3 STRATEGIC PILLARS ARE MORE THAN EVER RELEVANT LARGE CITIES CONCENTRATING 80% 1 TOP LOCATIONS IN MAJOR EUROPEAN ECONOMIC ACTIVITY Paris, Milan and Berlin # CITIES among the Top 4 cities in Europe by GDP of our portfolio is in cent
Slide 8: Qualitative strengthening since 2015
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… QUALITATIVE STRENGTHENING SINCE 2015 END OF 2015 TODAY BETTER ASSETS LOCATIONS 55% Of the portfolio in central locations* 80% Of the portfolio in central locations* MORE SUSTAINABLE PORTFOLIO 35% Of green assets 91% Of green assets EXI
Slide 9: I. Well prepared for a challenging environment
I. WELL PREPARED FOR A CHALLENGING ENVIRONMENT I.1. A HIGH-QUALITY DIVERSIFIED PORTFOLIO I.2. STRATEGY ADJUSTMENTS TO THE NEW ENVIRONMENT I.3. DISCIPLINE DEBT MANAGEMENT TO MAINTAIN A HEALTHY BALANCE SHEET CB21 – La Défense
Slide 10: A challenging and volatile environment
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… A CHALLENGING AND VOLATILE ENVIRONMENT WAR IN UKRAINE & ENERGY CRISIS SINCE FEBRUARY RISING INFLATION IN THE EUROZONE, SIGNS OF STABILIZATION IN NOVEMBER Year-on-year Eurozone inflation (%) 10.6% 9.9% 10.0% 8.9% 9.1% 8.6% Jun-22 Jul-22
Slide 11: Covivio is adjusting its strategy
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… COVIVIO IS ADJUSTING ITS STRATEGY 1 ACTIVE DISPOSAL STRATEGY IN 2023-2024 2 REFOCUSED PIPELINE FOR LOWER CAPEX 3 CAPITALIZE ON RENTAL GROWTH ACCELERATION Corte Italia Milan 11
Slide 12: Active disposal strategy by end-2024
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… 1 ACTIVE DISPOSAL STRATEGY BY END-2024 €154M €1.5BN GROUP SHARE DISPOSAL AGREEMENTS IN GROUP SHARE THE LAST MONTH FINANCE CAPEX IN LINE WITH 2021 APPRAISAL VALUES PORTFOLIO OF €441M OF DISPOSALS YTD DECREASE NET DEBT & LEVERAGE ASSETS
Slide 13: Disposal strategy
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… 1 DISPOSAL STRATEGY Remaining non-core assets SALE OF Selective core mature assets German Residential : acceleration on privatizations & small bloc sales Pan-European portfolio & 3 assets classes RELYING ON OUR DIVERSIFICATION… Allowin
Slide 14: Refocused offices committed pipeline
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… 2 REFOCUSED OFFICES COMMITTED PIPELINE € 2.5BN (GROUP SHARE) ~€200M AT END-JUNE 2022 CAPEX/YEAR UNTIL 2026 € 2.0BN - €394M (GROUP SHARE) AT END-2022 5.2% YIELD ON COST Q3 2022 + €22M Deliveries - €114M + €52M Postponed Additional fit-o
Slide 15: Moving forward
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… 2 MOVING FORWARD OFFICE MANAGED PIPELINE ✓ In 2023, launch of 2 projects in Paris CBD with high reversionary potential (>50%) & low capex (35% of 1 total cost) ✓ Postpone other managed projects TRANSFORM OFFICES INTO RESIDENTIAL 2 ✓ Bu
Slide 16: Shift in strategy: the German residential pipeline
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… 2 SHIFT IN STRATEGY: THE EXAMPLE OF THE GERMAN RESIDENTIAL PIPELINE INCREASING BUILD-TO-SELL IN GERMANY PIPELINE(1) AT PIPELINE(1) AT END-2021 END-2022 €420M Margins BUILD TO SELL €225M 35% BUILD TO SELL 65% (Group share) (Group share)
Slide 17: Capitalize on rental growth acceleration
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… 3 CAPITALIZE ON RENTAL GROWTH ACCELERATION PERFORMANCE TRENDS AT END-SEPTEMBER Success of our business model Accelerating indexation OFFICES +4.5% (o/w +2.3% indexation) Increased demand for prime Like-for-like rental growth Continued
Slide 18: Crystalize high reversionary potential
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… 3 CRYSTALIZE HIGH REVERSIONARY POTENTIAL OFFICES GERMAN RESIDENTIAL HOTELS PARISIAN PORTFOLIO +15-20% 2 ASSET MANAGEMENT OPERATIONS IN THE LAST 12 MONTHS +20% reversionary potential vs. regulated rent reversionary potential excl. asset
Slide 19: Preliminary appraisals in H2 2022 show resilience of our portfolio
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… PRELIMINARY APPRAISALS IN H2 2022 SHOW THE RESILIENCE OF OUR PORTFOLIO BASED ON PRELIMINARY FEEDBACKS FROM APPRAISERS. SUBJECT TO FINAL VALIDATION. APPRAISALS PRELIMINARY FULL YEAR 2022 DRIVERS OF PORTFOLIO’S IN H1 APPRAISALS IN H2 EXP
Slide 20: I. Well prepared for a challenging environment
I. WELL PREPARED FOR A CHALLENGING ENVIRONMENT I.1. A HIGH-QUALITY DIVERSIFIED PORTFOLIO I.2. STRATEGY ADJUSTMENTS TO THE NEW ENVIRONMENT I.3. DISCIPLINE DEBT MANAGEMENT TO MAINTAIN A HEALTHY BALANCE SHEET Silex² - Lyon
Slide 21: Healthy balance sheet
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… HEALTHY BALANCE SHEET LONGSTANDING LTV REDUCTION LARGE HEADROOM LTV POLICY <40% VS. BANK COVENANTS 50% LTV(1) 42.2% ≤ 60% 45% (for banks) 39.5% (Bank covenant) 40% 7.3x ≥ 2.0x 35% HIGH ICR (Bank covenant) 30% 2015 2016 2017 2018 2019 2
Slide 22: Highly diversified debt profile
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… HIGHLY DIVERSIFIED DEBT PROFILE €8.6BN Gross Debt (€7.8BN Net debt) DIVERSIFIED DIVERSIFIED DIVERSIFIED BY GEOGRAPHY BY ASSETS BY SOURCE Hotels Europe Commercial Papers Backed by €1.4BN Hotels 14% 14% 9% (€756M) Corporate credit lines
Slide 23: Well spread debt maturities
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… WELL SPREAD DEBT MATURITIES 5 YEAR AVERAGE DEBT MATURITY Highly diversified 2024-2025 debt expiries In €bn, Group share In €M, Group share 1.46 1.48 Mortgage Loans 683 701 1. 1.06 0.96 0.93 0.81 0.76 0.65 Corporate Credit 479 624 2. 0.
Slide 24: Focus on 2024-2025 expiries
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… FOCUS ON 2024-2025 EXPIRIES 1. MORTGAGE LOANS 2. CORPORATE CREDIT LINES 3. BONDS €1.4BN ~€ 350M € 1.1BN € 0.5BN per semester Undrawn • Highly diversified by assets • 20 tranches and all below €200M & geographies(1) • Long term partners
Slide 25: Managed cost of debt thanks to high hedging ratio
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… MANAGED COST OF DEBT THANKS TO HIGH HEDGING RATIO 86% 6.5 ~2.5% YEARS EXPECTED AVERAGE HEDGING RATIO AVERAGE HEDGING COST OF DEBT IN 2026 INSTRUMENTS Simulation based on the current MATURITY debt level and profile, assuming that debt w
Slide 26: II. ESG: on track with our objectives
II. ESG: ON TRACK WITH OUR OBJECTIVES Stream Building - Paris
Slide 27: Our purpose, the backbone of our ESG strategy
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… OUR PURPOSE, THE BACKBONE OF OUR ESG STRATEGY BUILD SUSTAINABLE RELATIONSHIPS & WELL-BEING Focus Focus 1 of 2 3 4 of today today WELL-BEING HIGH SUSTAINABLE DEVELOPING OUR OF OUR GOVERNANCE BUILDINGS TALENTS END-USERS STANDARDS THE SIG
Slide 28: II. ESG: on track with our objectives
II. ESG: ON TRACK WITH OUR OBJECTIVES II.1. SUSTAINABLE BUILDINGS II.2. HIGH GOVERNANCE STANDARDS II.3. OUTSTANDING RATINGS Stream The Sign Building - Milan- Paris
Slide 29: An ambitious carbon reduction target
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… AN AMBITIOUS CARBON REDUCTION TARGET S Decrease by 63% our 100 CARBON TRAJECTORY NET ZERO emissions vs. 2010 (kgCO2 / m² / year, 100 basis) BY 2030 Compensate the remaining SCOPES 1 & 2 part of our emissions TARGET ON SCOPE 3 Build in
Slide 30: A 91% certified portfolio
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… A 91% CERTIFIED PORTFOLIO GERMAN RESIDENTIAL 100% CERTIFIED GREEN % of certified tertiary assets having HQE/LEED/BREEAM certification 30% OF THE PORTFOLIO > Very Good Outstanding 21% <Very Good 31% OFFICES 57% 88% 88% CERTIFIED GREEN 3
Slide 31: Green capex to achieve our 2030 carbon trajectory
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… GREEN CAPEX TO ACHIEVE OUR 2030 CARBON TRAJECTORY GREEN CAPEX % OF THE PORTFOLIO VALUE (GROUP SHARE) M€/YEAR (GROUP SHARE) OFFICES €111M €14M ~ 1% 10% Such as optimization of monitoring systems short-term actions GERMAN RESIDENTIAL €13
Slide 32: Selected examples of green capex
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… SELECTED EXAMPLES OF GREEN CAPEX OFFICES GERMAN RESIDENTIAL HOTELS Wellio Gare de Lyon, Paris Berlin Neukölln Park Inn Alexanderplatz €250K green capex plan: €1.2M green capex plan: ▪ Facade insulation ▪ LED relamping ▪ Window moderniz
Slide 33: II. ESG: on track with our objectives
II. ESG: ON TRACK WITH OUR OBJECTIVES II.1. SUSTAINABLE BUILDINGS II.2. HIGH GOVERNANCE STANDARDS II.3. OUTSTANDING RATINGS The Sign - Milan
Slide 34: High governance standards
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… HIGH GOVERNANCE STANDARDS Delfin (since 2007) Separate chairman & CEO Best practices board Free-float 27% composition 43% women members 49% 57% independent members SHAREHOLDING Strong experience with diversity of skills STRUCTURE ACM (
Slide 35: Experienced board & management team with proven track record
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… EXPERIENCED BOARD & MANAGEMENT TEAM WITH PROVEN TRACK RECORD STRONG EXECUTIVE COMMITTEE WITH LONG EXPERIENCE IN THE INDUSTRY 11 Members 23 Average years of experience in Real Estate 13 Average years at Covivio JEAN-LUC BIAMONTI CHAIRMA
Slide 36: II. ESG: on track with our objectives
II. ESG: ON TRACK WITH OUR OBJECTIVES II.1. SUSTAINABLE BUILDINGS II.2. HIGH GOVERNANCE STANDARDS II.3. OUTSTANDING RATINGS The Sign - Milan
Slide 37: A strategy well recognized by ESG rating agencies
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… A STRATEGY WELL RECOGNIZED BY ESG RATING AGENCIES B- rating Negligible risk 88/100 Best possible rating Prime universe since 2015 Global sector leader 13nd in the sector (1,069 companies) AAA rating 83/100 81/100 Best possible rating S
Slide 38: III. CBRE presentation on German residential
III. CBRE PRESENTATION ON GERMAN RESIDENTIAL Königstrasse 60 - Berlin
Slide 39: IV. Update on our 3 asset classes
IV. UPDATE ON OUR 3 ASSET CLASSES CB21 – La Défense
Slide 40: IV. Update on our 3 asset classes
IV. UPDATE ON OUR 3 ASSET CLASSES IV.1. GERMAN RESIDENTIAL: A PRIME PORTFOLIO WITH GROWTH DRIVERS IV.2. OFFICES: A SUCCESSFUL STRATEGY IV.3. HOTELS: PERFORMANCES ABOVE 2019 AND ASSET MANAGEMENT OPPORTUNITIES Feuerbachstrasse 31 - Berlin
Slide 41: IV.1. German residential: A. German residential market
IV.1. GERMAN RESIDENTIAL: A PRIME PORTFOLIO WITH GROWTH DRIVERS A. GERMAN RESIDENTIAL MARKET 41
Slide 42: Favourable demographic trends
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… FAVOURABLE DEMOGRAPHIC TRENDS GERMANY CONTINUES TO OUTPERFORM EUROPEAN UNION POSITIVE EXPECTATIONS IN OUR CITIES BY 2030 Demographic variations in Germany and European Union from 2013 to 2021 Population – Annual growth expectations by
Slide 43: Lack of offer is further building up
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… LACK OF OFFER IS FURTHER BUILDING UP STRUCTURAL UNDERSUPPLY IN GERMANY… …EXPECTED TO CONTINUE Completion volume of residential units in Germany Restrictions in Residential construction Minimum needed 400,000 300,000 17% 48% Constructio
Slide 44: Continued rise in rents
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… CONTINUED RISE IN RENTS GROWTH IN RENTAL MARKETS FOLLOW INFLATION OVER THE MEDIUM TERM Example of high inflation period MARKET RENTS CONTINUE TO RISE IN GERMANY 7% 6% MARKET RENT MIETSPIEGEL INCREASE (RENTAL INDEX) 5% INCREASE 4% +13.4
Slide 45: German government to provide public help against rising charges
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… GERMAN GOVERNMENT TO PROVIDE PUBLIC HELP AGAINST RISING CHARGES GERMAN GOVERNMENT ANNOUNCED A €200BN “DEFENSIVE SHIELD”(1) AGAINST SURGING ENERGY PRICES DETAILS OF THE AID PACKAGE The goal is to protect companies and households from th
Slide 46: IV.1. German residential: B. A high-quality portfolio
IV.1. GERMAN RESIDENTIAL: A PRIME PORTFOLIO WITH GROWTH DRIVERS B. A HIGH-QUALITY PORTFOLIO 46
Slide 47: Quality improvement and shift towards Berlin
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… QUALITY IMPROVEMENT AND SHIFT TOWARDS BERLIN ACTIVE ON GERMAN RESIDENTIAL THROUGH ITS 61.7% SUBSIDIARY ALONGSIDE LONG TERM INSURANCE COMPANIES PORTFOLIO AT END-JUNE 2022 PORTFOLIO AT END-2015 Hamburg Hamburg Berlin €5.4BN 7% Berlin 8%
Slide 48: Our key differentiating factors
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… OUR KEY DIFFERENCIATING FACTORS A portfolio mostly 100% 90% exposed to #1 A-cities in Germany In Metropolitan areas >1M inhabitants In cities >500k inhabitants Target the high-end Lower tenant effort rate ~63% #2 of the housing market
Slide 49: Berlin – a prime portfolio (1/2)
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… BERLIN – A PRIME PORTFOLIO (1/2) €3.1BN(1) PORTFOLIO (Of which €0.5bn of commercial assets fully indexed) HIGH-QUALITY LOCATIONS AND STRONG REVERSIONARY POTENTIAL VALUATION AVERAGE RENT WELL HIGH-QUALITY WELL BELOW BELOW REGULATED BUIL
Slide 50: Berlin – a prime portfolio (2/2)
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… BERLIN – A PRIME PORTFOLIO (2/2) Prenzlauer Fregestrasse Promenade 76 OUR PORTFOLIO IN BERLIN 16,862 RESIDENTIAL UNITS Königstrasse 60 Kurfürstendamm 96 1,195 COMMERCIAL Prenzlauer Nollendorf- Allee 174 strasse 26 UNITS Südstern (FULLY
Slide 51: North-Rhine-Westphalia – a refocused portfolio
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… NORTH-RHINE-WESTPHALIA – A REFOCUSED PORTFOLIO SINCE 2015 PORTFOLIO AT END-JUNE 2022 OTHERS 15% INVESTMENTS ESSEN Mostly in the most 39% dynamic cities DUSSELDORF 10% +9 pts of Düsseldorf & Essen +10 pts €500M € 1.4BN PORTFOLIO GROUP S
Slide 52: North-Rhine-Westphalia – a refocused portfolio
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… NORTH-RHINE-WESTPHALIA – A REFOCUSED PORTFOLIO Margareten- strasse OUR PORTFOLIO IN Essen NORTH RHINE-WESTPHALIA Essen and Mülheim Duisburg Dürerstrasse Duisburg €1.4BN €0.7BN PORTFOLIO VALUE €0.2BN PORTFOLIO VALUE Mettmannerstrasse PO
Slide 53: Dresden, Leipzig and Hamburg – dynamic cities
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… DRESDEN, LEIPZIG AND HAMBURG – 3 DYNAMIC CITIES A CONCENTRATED PRINT WITH HIGH GROWTH POTENTIAL HAMBURG: €0.4BN DRESDEN & LEIPZIG: €0.4BN €10.2/M²/Month €4,455/M² €7.4/M²/Month €2,548/M² AVERAGE RENT VALUE AVERAGE RENT VALUE +20/25% ~
Slide 54: Dresden, Leipzig and Hamburg
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… DRESDEN, LEIPZIG AND HAMBURG Marschner- Nordplatz 2 strasse 15 - 27 Leipzig OUR PORTFOLIO Dresden IN DRESDEN, LEIPZIG AND HAMBURG Freiberger- €0.9BN strasse 5 - 27 Dresden PORTFOLIO VALUE Eppendorfer 6,723 RESIDENTIAL UNITS Weg 110 - 1
Slide 55: A strong local team with a proven track record
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… A STRONG LOCAL TEAM WITH A PROVEN TRACK RECORD More than 500 people to locally manage DANIEL FREY the whole value chain CEO KEVIN LABUS JOCHEN HUMPERT RAINER LANGENHORST MATTHIAS GÖBEL KATJA STIEFENHÖFER Head of Chief Chief Head of CFO
Slide 56: Portfolio quality: high tenant satisfaction
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… PORTFOLIO QUALITY: HIGH TENANT SATISFACTION THANKS TO OUR SOCIAL COMMITMENT HIGH CLIENT-CENTRICITY 1 Covivio #home 360 23 24/7 Tenant Employees taking Services Call center IN THE care of customers centers and emergency App FOCUS MONEY
Slide 57: IV.1. C. Adapt the portfolio strategy and rely on its growth drivers
IV.1. GERMAN RESIDENTIAL: A PRIME PORTFOLIO WITH GROWTH DRIVERS C. ADAPT THE PORTFOLIO STRATEGY AND RELY ON ITS GROWTH DRIVERS 57
Slide 58: Adapt the portfolio strategy to the new environment
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… ADAPT THE PORTFOLIO STRATEGY TO THE NEW ENVIRONMENT 1 STREAMLINE THE DEVELOPMENT PIPELINE 2 ACCELERATE DISPOSALS 3 INCREASE RENT THROUGH ASSET MANAGEMENT Königstrasse 60 Berlin 58
Slide 59: A high quality pipeline
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… 1 A HIGH QUALITY PIPELINE TOTAL PIPELINE AT END-2021 WELL LOCATED PROJECTS 8 7 7 7 11 19 12 5 9 82% 13 10 5 4 14 1 2 225,000m² 3 17 6 IN BERLIN 15 18 19 TOTAL SURFACE 16 WHERE LACK OF OFFER IS THE HIGHEST IN GERMANY €639M TOTAL BUDGET
Slide 60: Strategic shift to build-to-sell
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… 1 STRATEGIC SHIFT TO BUILT-TO-SELL PIPELINE(1) MAIN AT END-2022 IMPACTS FINANCING #1 NEEDS DECREASE BUILD TO SELL € 420M 65% - €100M BY 2025 (+30pts (Group share) vs before shift) of which - €30M in 2023 PROFITABILITY BUILD TO LET €220
Slide 61: Further margins and value creation
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… 1 FURTHER MARGINS AND VALUE CREATION COMMITTED PIPELINE MANAGED PIPELINE € 196M € 443M >90% IN BERLIN, TO BE DELIVERED BEFORE 2025 TO BE LAUNCHED PROGRESSIVELY €139M >25% HAMBURG €77M 13% Current Book Built-to-Sell Profit margin value
Slide 62: Prenzlauer Promenade: from build-to-rent to build-to-sell
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… PRENZLAUER PROMENADE: FROM BUILD-TO-RENT TO BUILD-TO-SELL INITIAL PROJECT IN BERLIN (5km from city center) Spree 278 UNITS City Subcentre c.18,000 m² €6,500/M² Not fully SURFACE €45M Centre Price delivered Fringe build-to-sell 2022 56%
Slide 63: Adapt the portfolio strategy to the new environment
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… ADAPT THE PORTFOLIO STRATEGY TO THE NEW ENVIRONMENT 1 STREAMLINE THE DEVELOPMENT PIPELINE 2 ACCELERATE DISPOSALS 3 INCREASE RENT THROUGH ASSET MANAGEMENT Königstrasse 60 Berlin 63
Slide 64: Accelerating disposals through 2 sources
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… 2 ACCELERATING DISPOSALS THROUGH 2 SOURCES #1 BLOC SALES Capacity to sell small portfolios (average value : €7M/asset) TARGET to different kind of buyers (Family offices, funds, institutional, local administrations) €150M SALES #2 COND
Slide 65: Capitalizing on privatizations (1/2)
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… 2 CAPITALIZING ON PRIVATIZATIONS (1/2) HIGHLY DIVIDED PORTFOLIO Since 2016, 2,700 units divided per year… 5,113 € 5.4BN Portfolio at end-june 2022 2,896 2,014 2,352 2,356 1,442 564 2016 2017 2018 2019 2020 2021 2022 … leading to 14,000
Slide 66: Capitalizing on privatizations (2/2)
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… 2 CAPITALIZING ON PRIVATIZATIONS (2/2) SOLID TRACK RECORD REGULAR PRIVATIZATIONS WITH HIGH MARGINS HIGH GROWTH RESERVE IN EACH CITY (Group share disposals, In € million) €40M BERLIN HAMBURG DRESDEN €37M €27M & LEIPZIG ~ €5,300/m² ~ 6,0
Slide 67: Adapt the portfolio strategy to the new environment
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… ADAPT THE PORTFOLIO STRATEGY TO THE NEW ENVIRONMENT 1 STREAMLINE THE DEVELOPMENT PIPELINE 2 ACCELERATE DISPOSALS 3 INCREASE RENT THROUGH ASSET MANAGEMENT Königstrasse 60 Berlin 67
Slide 68: 3 rental growth drivers
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… 3 3 RENTAL GROWTH DRIVERS INDEXATION RELETTINGS MODERNIZATIONS Increasing Mietspiegel High reversionary Attractive Yield (85% of the rents) potential on Cost New index to be published in Berlin in H1 2023 +15/20% >5% VS. REGULATED RENT
Slide 69: Focus on modernizations
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… 3 FOCUS ON MODERNIZATIONS F Roemerstraße 25 F Duisburg D SOUND G 2019 C TRACK B 6.4% RECORD YoC 10.9% YoC 5.6% 31% €40M/year YoC value 178% creation value MODERNIZATION creation 44% value CAPEX Ratingen west creation Ratingen F 2020 D
Slide 70: Key takeaways
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… KEY TAKEWAYS #1 #3 An asset class Adapting the benefitting strategy to from positive # 2 the changing long-term environment #4 trends High quality portfolio Strong growth drivers Build-to-sell Reversion Modernizations Privatizations 70
Slide 71: IV. Update on our 3 asset classes
IV. UPDATE ON OUR 3 ASSET CLASSES IV.1. GERMAN RESIDENTIAL: A PRIME PORTFOLIO WITH GROWTH DRIVERS IV.2. OFFICES: A SUCCESSFUL STRATEGY IV.3. HOTELS: PERFORMANCES ABOVE 2019 AND ASSET MANAGEMENT OPPORTUNITIES 21 Goujon - Paris
Slide 72: IV.2. Offices: A. Increasing demand and polarization
IV.2. OFFICES: A SUCCESSFUL STRATEGY A. INCREASING DEMAND AND POLARIZATION IN EUROPEAN OFFICE MARKETS 72
Slide 73: Pursuit of the recovery across our offices markets
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… PURSUIT OF THE RECOVERY ACROSS OUR OFFICES MARKETS… OFFICES TAKE-UP IS RECOVERING IN EUROPE (1) 9-months 2022 figures (in million m²) 12.0 GREATER 1.5M m² > €980 /m² (2) PARIS TAKE-UP PRIME RENT 10.0 +20% YoY +7% YoY Average: 9.2 M m²
Slide 74: …with an increasing polarization
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… …WITH AN INCREASING POLARIZATION OFFICE TAKE-UP STILL FOCUSED ON CENTRAL AREAS LEADING TO INCREASING POLARISATION 9M Take-Up breakdown - Greater Paris Changes in available supply - Greater Paris (%) (%) Outer Rim -11% QoQ +3% QoQ +8%Qo
Slide 75: IV.2. Offices: B. A high-quality offices portfolio
IV.2. OFFICES: A SUCCESSFUL STRATEGY B. A HIGH-QUALITY OFFICES PORTFOLIO 75
Slide 76: Office portfolio mostly exposed to city-centers
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… OFFICE PORTFOLIO MOSTLY EXPOSED TO CITY-CENTERS CORE Assets CORE Assets in City-centers 64% 27% Outside City-centers Core assets in Core assets in: Greater Paris, Paris/Levallois, Italy, Berlin Periphery of German cities Milan Düsseldo
Slide 77: IV.2. Offices: C. A portfolio built around 3 strategic pillars
IV.2. OFFICES: A SUCCESSFUL STRATEGY C. A PORTFOLIO BUILT AROUND 3 STRATEGIC PILLARS 77
Slide 78: 3 pillars to tackle structural office changes
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… 3 PILLARS TO TACKLE STRUCTURAL OFFICE CHANGES 1 CENTRALITY 2 NEW BUILDINGS 3 WELL-BEING OF OUR END USERS Percier Paris 78
Slide 79: Continued centrality increase
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… 1 CONTINUED CENTRALITY INCREASE SUSTAINED TRANSFORMATION OF OUR OFFICE PORTFOLIO IN FRANCE AND ITALY 2019 H1 2022 c.€1.6BN REINVESTED IN OFFICES SOLD CENTRAL BETWEEN EARLY 2020 AND MID 2022 & PRIME DEVELOPMENTS 89% of Italian portfolio
Slide 80: 3 pillars to tackle structural office changes
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… 3 PILLARS TO TACKLE STRUCTURAL OFFICE CHANGES 1 CENTRALITY 2 NEW BUILDINGS 3 WELL-BEING OF OUR END USERS Percier Paris 80
Slide 81: Offer new buildings
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… 2 OFFER NEW BUILDINGS SOLID A €2.0BN COMMITTED PIPELINE FITTING CLIENTS NEEDS & CREATING VALUE PIPELINE SOLID AT END-2022 80% IN CITY-CENTERS 20% IN TOP BUSINESS DISTRICTS PIPELINE AT END-2022 PARIS MILAN BERLIN 14 14 PROJECTS PROJECTS
Slide 82: Offer new buildings
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… 2 OFFER NEW BUILDINGS 80% IN CITY-CENTERS 20% IN TOP BUSINESS DISTRICTS Maslo, Anjou, Q1 2023 Levallois Q3 2023 Q2 2025 Paris Q1 2023 Q2 2023 Dassault 9,300m² extension, 30% pre-let 19,800m² 100% pre-let 100% pre-let 0% pre-let 100% pr
Slide 83: Illustration of our offices strategy: Goujon
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… 2 ILLUSTRATION OF OUR OFFICES STRATEGY 21 GOUJON – A STATE-OF-THE-ART BUILDING IN PARIS CBD SURFACE AREA +30% €950/m² 8,600 m² UPSIDE ON ECONOMIC RENT NEW TOP RENT €930/m² ~10% incentives COST (GS) TARGET RENT €196M €820/m² TARGET RENT
Slide 84: 3 pillars to tackle structural office changes
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… 3 PILLARS TO TACKLE STRUCTURAL OFFICE CHANGES 1 CENTRALITY 2 NEW BUILDINGS 3 WELL-BEING OF OUR END USERS Percier Paris 84
Slide 85: Improve the well-being of our end-users
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… 3 IMPROVE THE WELL-BEING OF OUR END-USERS Design- A Design thinking process to involve all key Thinking Offer stakeholders High-quality Offer best services to help our tenants to attract services and retain talents High-quality Carbon
Slide 86: Higher customer satisfaction
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… 3 HIGHER CUSTOMER SATISFACTION KINGSLEY SURVEY JUNE 2022(2) 89% of offices tenants 4.3/5 4.1/5 Property management Facility overall management overall satisfaction satisfaction SATISFIED 3.8/5 Surveyor’s index 3.6/5 Surveyor’s index or
Slide 87: Milan – showcase of our successful office strategy
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… MILAN – SHOWCASE OF OUR SUCCESSFUL OFFICE STRATEGY STRATEGIC PRIORITIES SINCE 2015 YTD PERFORMANCE Increasing +22pts 95% 98% Of occupancy centrality % portfolio in Milan Of portfolio in Milan1 Accelerating >50% €435M of Milan portfolio
Slide 88: Strategic roadmap
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… STRATEGIC ROADMAP #1 #3 Continue to Push on our reinforce all-in-one centrality services DUPLICATE OUR #2 offer GLOBAL OFFICES STRATEGY IN OUR Continue to upgrade GERMAN OFFICE asset quality PORTFOLIO 88
Slide 89: IV.2. Offices: D. German offices
IV.2. OFFICES: A SUCCESSFUL STRATEGY D. GERMAN OFFICES: ASSET MANAGEMENT & REINFORCEMENT IN BERLIN 89
Slide 90: The first European office market
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… THE FIRST EUROPEAN OFFICE MARKET TOP 5 GERMAN CITIES OFFICES SUB-MARKETS Hamburg Take-up 479,000 m² 3.7% Vacancy rate €2.6BN average 2.9M M² 1.9M M² 0.9M M² Berlin annual investments AVERAGE ANNUAL Take-up 855,000 m² 2.9% Vacancy rate
Slide 91: Continued rise in rents in top German cities
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… CONTINUED RISE IN RENTS IN TOP 5 GERMAN CITIES PRIME RENT EVOLUTION AVERAGE RENT EVOLUTION +7%/year on average since 2017 in Berlin +8%/year on average since 2017 in Berlin ( in € / m² /Year) ( in € / m² /Year) € 600 € 350 €576 €339 €
Slide 92: A portfolio concentrated on top German cities
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… A PORTFOLIO CONCENTRATED ON TOP 5 GERMAN CITIES FRANKFURT DÜSSELDORF 30% 19% 21 ASSETS € 1.5BN PORTFOLIO GROUP SHARE AT END-JUNE 2022 17 IN OPERATION BERLIN 26% HAMBURG 18% 4 IN DEVELOPMENT MOSTLY IN BERLIN Others MUNICH 7% 92
Slide 93: A new team for a new strategy roadmap
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… A NEW TEAM FOR A NEW STRATEGY ROADMAP ASSET MANAGEMENT 5 EMPLOYEES DEVELOPMENT FRIEDERIKE HOBERG Head of German Offices 8 EMPLOYEES ▪ Joined Covivio as Head of German Offices in 2022 PROPERTY ▪ +15 Years of experience in real estate, l
Slide 94: A portfolio mostly made of core assets
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… A PORTFOLIO MOSTLY MADE OF CORE ASSETS 66% 34% 80% CORE ASSETS in operation in development 20% NON-CORE ASSETS 89% (1) €4,400/m² (1) €192/m² (1) 76% €3,000/m² €149/m² Occupancy rate Average value Average rent Occupancy rate Average val
Slide 95: Covivio strategy for offices in Germany
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… COVIVIO STRATEGY FOR OFFICES IN GERMANY 1 TACKLE LETTING CHALLENGES 2 DISPOSE NON-CORE ASSETS 3 CAPTURE RENTAL GROWTH 4 REINFORCE BERLIN EXPOSURE Alexanderplatz Berlin 95
Slide 96: Tackle letting challenges
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… 1 TACKLE LETTING CHALLENGES LETTING CHALLENGES ARE FOCUSED ON 4 ASSETS SUB-MARKET ASSET VACANCY LOCATION VACANCY Redevelop 47% In the city-center, with excellent accesibility 5.5% Before reletting In the center Herzog, Düsseldorf Refur
Slide 97: Case study: Herzogterrassen, Düsseldorf
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… 1 CASE STUDY: HERZOGTERRASSEN, DÜSSELDORF CREATING A NEW REFERENCE IN THE HEART OF DÜSSELDORF Excellent accessibility Attractive rent metro at 200 m €252/m² vs €336/m² CBD Central location Iconic building 5 min to CBD Large floorplans
Slide 98: Case study: Zeughaus, Hamburg
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… 1 CASE STUDY: ZEUGHAUS, HAMBURG HISTORICAL PART: 42,000 m² of offices 15,900 m² in the North of Hamburg, 2 Parts: Strong architectural identity Unique floorplans, with cathedral and triple heights NEW PART: 30% Occupancy 25,700 m² Tech
Slide 99: Covivio strategy for offices in Germany
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… COVIVIO STRATEGY FOR OFFICES IN GERMANY 1 TACKLE LETTING CHALLENGES 2 DISPOSE NON-CORE ASSETS 3 CAPTURE RENTAL GROWTH 4 REINFORCE BERLIN EXPOSURE Alexanderplatz Berlin 99
Slide 100: Disposal of non-core assets
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… 2 DISPOSAL OF NON-CORE ASSETS Pentahof Hamburg 100% c.€300M OUTSIDE CITY CENTERS Progressive Eight disposal Dornach Munich Y2 OF ASSETS TO BE after asset Frankfurt SOLD TO IMPROVE management PORTFOLIO QUALITY 76% OCCUPANCY works RATE A
Slide 101: Covivio strategy for offices in Germany
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… COVIVIO STRATEGY FOR OFFICES IN GERMANY 1 TACKLE LETTING CHALLENGES 2 DISPOSE NON-CORE ASSETS 3 CAPTURE RENTAL GROWTH 4 REINFORCE BERLIN EXPOSURE Alexanderplatz Berlin 101
Slide 102: Capture rental growth
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… 3 CAPTURE RENTAL GROWTH GERMAN CPI 10.0% THROUGH +1.0% +4.2% 5.3% INDEXATION Indexation Indexation FY 2021 9M 2022 2.3% -0.3% 12/20 3/21 6/21 9/21 12/21 3/22 6/22 9/22 2021/2022 ACHIEVEMENTS THROUGH 5-10% +5 / +10% Through Renewals (46
Slide 103: Covivio strategy for offices in Germany
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… COVIVIO STRATEGY FOR OFFICES IN GERMANY 1 TACKLE LETTING CHALLENGES 2 DISPOSE NON-CORE ASSETS 3 CAPTURE RENTAL GROWTH 4 REINFORCE BERLIN EXPOSURE Alexanderplatz Berlin 103
Slide 104: Increase Berlin exposure through prime developments
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… 4 INCREASE BERLIN EXPOSURE THROUGH PRIME DEVELOPMENTS ALEXANDERPLATZ 60,000m² Mixed-use (office, residential, retail) LOFT 7,600m² Mixed-use (office, residential) €387M TOTAL BUDGET BEAGLE 5,000m² Office 104
Slide 105: Alexanderplatz, Berlin
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… 4 ALEXANDERPLATZ, BERLIN Urban Campus Mixed-use high-rise asset, developed as an urban campus: flexible office space, furnished apartments, retail & SURFACE AREA community areas 60,000 m² 30,000m² 15,000m² 15,000m² COST Office Resident
Slide 106: Loft, Berlin
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… 4 LOFT, BERLIN Mixed-use property located in a trendy central location, near Berlin Central Station SURFACE AREA & Federal chancellery 7,600 m² Full refurbishment and roof extension (+1,000 m²) of an COST existing asset in Moabit: an a
Slide 107: Beagle, Berlin
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… 4 BEAGLE, BERLIN 100% Office refurbishment PRE-LET Existing asset from the 1980s, acquired by Covivio in 2019 in FOR 15 YEARS TO DEUTSCHE BAHN order to refurbish it SURFACE AREA 5,000 m² Efficient accessibility COST On the way to the A
Slide 108: Our roadmap for the medium term
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… OUR ROADMAP FOR THE MEDIUM TERM REPRODUCE THE SUCCESSFULL OFFICE STRATEGY FROM FRANCE AND ITALY Continue to focus Sell non core assets Accelerate the deployment on central locations of services to clients Reinforce €300M Services offer
Slide 109: IV. Update on our 3 asset classes
IV. UPDATE ON OUR 3 ASSET CLASSES IV.1. GERMAN RESIDENTIAL: A PRIME PORTFOLIO WITH GROWTH DRIVERS IV.2. OFFICES: A SUCCESSFUL STRATEGY IV.3. HOTELS: PERFORMANCES ABOVE 2019 AND ASSET MANAGEMENT OPPORTUNITIES The Westin Grand - Berlin
Slide 110: IV.3. Hotels: A. A leader in hotel real estate
IV.3. HOTELS: PERFORMANCES ABOVE 2019 AND ASSET MANAGEMENT OPPORTUNITIES A. A LEADER IN HOTEL REAL ESTATE 110
Slide 111: A leader in hotel real estate
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… A LEADER IN HOTEL REAL ESTATE COVIVIO IS ACTIVE ON HOTELS THROUGH ITS SUBSIDIARY (COVIVIO HOTELS) OWNED AT 43.9% A PAN-EUROPEAN PORTFOLIO COVIVIO HOTELS BUSINESS AT A GLANCE UK / Ireland €Bn 0.9 GAV Belgium / Netherlands Germany €Bn 1.
Slide 112: A strategic portfolio for operators
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… A STRATEGIC PORTFOLIO FOR OPERATORS Average Non-replicable prime locations 8.8/10 Booking.com Location grade Solid tenants Base Leader tenants 12.3Years and operators Lease duration STRONG POSITIONING Reasonnable Sustainable effort rat
Slide 113: A well-balanced and diversified hotel portfolio
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… A WELL-BALANCED AND DIVERSIFIED HOTEL PORTFOLIO BY COUNTRY BY CONTRACT TYPE BY SEGMENT BY OPERATOR GAV GAV GAV GAV €2.6BN GS COVIVIO 13% 14% Others 21% 22% Belgium 5% 41% 32% 6% variable 6% 11% Spain 13% Upscale 7% 20% 14% 13% Others U
Slide 114: Covivio's quality hotel portfolio in Germany
€1.5BN WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… COVIVIO’S QUALITY HOTEL PORTFOLIO IN GERMANY PORTFOLIO AT 100% (0.6BN GROUP SHARE) LEASE PROPERTIES OPERATING PROPERTIES 44% Berlin 13% Dresden & Leipzig 5% Frankfurt 4% Munich 34% other cities NH Berlin Pullman 99 rooms Dresde
Slide 115: A portfolio managed by an experienced team
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… A PORTFOLIO MANAGED BY AN EXPERIENCED TEAM TUGDUAL MILLET SEBASTIEN DE COURTIVRON CEO DEPUTY CEO – HOTEL OPERATIONS SOPHIE GAUTIER CRISTINA HOYO PATRICK BOUR HEAD OF HEAD OF CFO ASSET MANAGEMENT FRANCE ASSET MANAGEMENT HOTELS + NORTHER
Slide 116: IV.3. Hotels: B. Industry faced an unprecedented stress test
IV.3. HOTELS: PERFORMANCES ABOVE 2019 AND ASSET MANAGEMENT OPPORTUNITIES B. THE INDUSTRY HAS SUCCESSFULLY FACED AN UNPRECEDENTED STRESS TEST 116
Slide 117: Market – recovery faster and higher than expected
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… MARKET – RECOVERY FASTER AND HIGHER THAN EXPECTED CONTINUED RECOVERY MOMENTUM STRONG PRICING POWER Monthly RevPAR (1) (%) vs 2019 AVERAGE PRICES PER ROOM BEATING 2019 LEVELS Oct 21 Dec 21 Feb 22 Apr 22 Jun 22 Aug 22 Oct 22 30% +22% +18
Slide 118: Covivio variable revenues above 2019 since May
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… COVIVIO VARIABLES REVENUES ABOVE 2019 SINCE MAY ACCORINVEST VARIABLE RENTS EBITDA OPERATING PROPERTIES 21% OF HOTEL’S PORTFOLIO 20% OF HOTEL’S PORTFOLIO 2019 2022 2019 2022 2022 2022 2019 2019 Jan. Feb. Mar. Apr. May. Jun. Jul. Aug. Se
Slide 119: IV.3. Hotels: C. The return to a new normal
IV.3. HOTELS: PERFORMANCES ABOVE 2019 AND ASSET MANAGEMENT OPPORTUNITIES C. THE RETURN TO A NEW NORMAL 119
Slide 120: Leisure and business coming back to pre-Covid level
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… LEISURE AND BUSINESS COMING BACK TO PRE-COVID LEVEL TRAVEL EXPENSES IN EUROPE INDUSTRY WIDE TRENDS (In % of 2019) 140% 132% Extending a business trip has become 125% 125% 118% a “new normal” 120% 117% 125% 110% 109% 111% 112% Working f
Slide 121: Leisure and business coming back: RevPAR forecasts
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… LEISURE AND BUSINESS COMING BACK TO PRE-COVID LEVEL REVPAR FORECASTS IN EUROPE EXPECTED REVPAR INCREASES IN 2023 OCCUPANCY AVERAGE (2023 vs 2022) RATE DAILY RATE (2023 vs 2022) 10% +10% Domestic +8% +8% Individual 8% +7% Business Inter
Slide 122: IV.3. Hotels: D. Asset management opportunities
IV.3. HOTELS: PERFORMANCES ABOVE 2019 AND ASSET MANAGEMENT OPPORTUNITIES D. ASSET MANAGEMENT OPPORTUNITIES TO BOOST PERFORMANCES 122
Slide 123: Asset management opportunities to boost performances
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… ASSET MANAGEMENT OPPORTUNITIES TO BOOST PERFORMANCES COVIVIO HOTELS PORTFOLIO BREAKDOWN 2023 1 2 3 OPERATING 3 2 VARIABLE RENTS FIXED VARIABLE OPERATING PROPERTIES ACCORINVEST LEASES ACCORINVEST PROPERTIES 20% 21% LEASES Steady increas
Slide 124: Invest in asset and choose tenant to increase rent
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… INVEST IN ASSET AND CHOOSE TENANT TO INCREASE RENT 1 FIXED LEASES 2 VARIABLE LEASES 3 OPERATING PROPERTIES Other opportunities ACQUISITION to come on our fixed RADISSON RED MADRID Acquired in 2017 leased portfolio: with an existing ind
Slide 125: Accorinvest portfolio: successful asset management
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… ACCORINVEST PORTFOLIO: SUCCESSFUL ASSET MANAGEMENT 1 FIXED LEASES 2 VARIABLE LEASES 3 OPERATING PROPERTIES UNTIL 2022 TRANSFORMING FROM LEASE TO #1 VARIABLE RENT IN FIXED RENT WITH B&B #3 FRANCHISE 39 ASSETS LET TO ACCORINVEST 30 Hotel
Slide 126: Invest in rooms to increase ADR
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… INVEST IN ROOMS TO INCREASE ADR 1 FIXED LEASES 2 VARIABLE LEASES 3 OPERATING PROPERTIES Opportunities on our operated Westin Grand portfolio: Berlin €6M €5M CAPEX(1) CAPEX(2) Costs and management 2019 INVESTMENT INVESTMENT TO FULLY opt
Slide 127: IV.3. Hotels: E. Outlook
IV.3. HOTELS: PERFORMANCES ABOVE 2019 AND ASSET MANAGEMENT OPPORTUNITIES E. OUTLOOK 127
Slide 128: Outlook for 2023
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… OUTLOOK FOR 2023 #1 #3 Positive trend Asset on management Revenues #2 opportunities to boost #4 2019 is not Benefit from performances a ceiling anymore indexation on Selective the back of disposal of sustainable both fixed and effort r
Slide 129: V. Key takeaways
V. KEY TAKEAWAYS Alexanderplatz - Berlin
Slide 130: Key takeaways
WELL PREPAR… ESG: ON TRAC… CBRE PRESEN… UPDATE ON O… KEY TAKEAW… KEY TAKEWAYS DIVERSIFICATION AND PORTFOLIO QUALITY ARE KEY STRENGTHS 1 IN A CHALLENGING AND VOLATILE ENVIRONMENT SOLID FINANCIAL PROFILE TO BE FURTHER REINFORCED 2 BY €1.5BN DISPOSAL PLAN AND REDUCED INVESTMENTS STRONG OPERATING TREND
Slide 131: Contacts
CONTACTS Investor Relations Vladimir MINOT Tel.: +33 1 58 97 51 94 vladimir.minot@covivio.fr Paris 30, avenue Kléber 75116 Paris Tel.: +33 1 58 97 50 00 www.covivio.eu