Colonial Sfl Socimi Sa · BME:COL

Colonial Sfl Socimi Sa — Inmobiliaria Colonial SOCIMI — FY2021 Earnings Presentation

57 slides from Colonial Sfl Socimi Sa's earnings presentation, Feb 28, 2022

  1. Slide 1: Annual Results 2021

    Annual Results 2021 February 2022 FY2021

  2. Slide 2: Disclaimer

    Disclaimer By attending this presentation and receiving this document, you are agreeing to be bound by the following limitations. Any failure to comply with these restrictions may constitute a violation of applicable securities laws and/or may result in civil, administrative or criminal liabilities.

  3. Slide 3: Agenda

    Agenda 01 Highlights 02_ Back to Growth in Operations 03 Back to Growth in Financials 04 Leadership in ESG & Decarbonization 05 Accelerating Growth in 2022 – 2023 06 Conclusion & Outlook 3

  4. Slide 4: Presenting management team

    Presenting management team PRESENTING MANAGEMENT TEAM Pere Viñolas Carmina Ganyet Carlos Krohmer Chief Executive Officer Corporate Managing Director Chief Corporate Development Officer 4

  5. Slide 5: Highlights: Back on Track with Solid Growth

    01 Highlights Back on Track with Solid Growth

  6. Slide 6: 2021 Results - Back to Growth

    01 Highlights 2021 Results - Back to Growth GROWTH BACK ON TRACK WITH ABOVE AVERAGE RETURNS QUALITY DELIVERING SUPERIOR PERFORMANCE 11. +9% NTA Total Shareholder Return, well above peer average 1. 1 Letting Volume of 170,344 sqm - 2nd highest in history 22. Net Total Assets of 12.04 €/share beating

  7. Slide 7: 2021 Results - Financial Results

    01 Highlights 2021 Results - Back to Growth in Financial Results STRONG TOTAL RETURN & VALUE CREATION SOLID PROFITABILITY Total Shareholder Return +9% Group Net Profit €474m +€471m NTA Based +15% NTA per share 12.04 €/sh. +7% Recurring Earnings €128m in comparable terms +13% EPRA NTA €6.5bn Recurrin

  8. Slide 8: 2021 Results - Operations

    01 Highlights 2021 Results - Back to Growth in Operations OUTSTANDING OPERATING PERFORMANCE ESG LEADERSHIP +75% Portfolio with high Letting volume 170,344 sqm YoY 95% eco-efficiency +252 bp 2nd highest in history Only European Office Company Letting acceleration in 2H 110,560 sqm +101% CDP Rating Yo

  9. Slide 9: Quality delivering superior performance

    02 Back to Growth in Operations Quality delivering superior performance

  10. Slide 10: Outstanding letting performance – 2nd highest volume in history

    02 Back to Growth in Operations Outstanding letting performance – 2nd highest volume in history > Grade A product in CBD scarce in every market > Paris CBD with take-up outperforming pre-Covid levels > 4Q21 take-up accelerating in Barcelona and Madrid Rental market – Recovering Take-up facing scarce

  11. Slide 11: Strong performance on all operational KPIs

    02 Back to Growth in Operations Strong performance on all operational KPIs LETTING VOLUME SQM KPIS 2021 1Q21 2Q21 3Q21 4Q21 TOTAL YoY MAX. RENT RELEASE SPREAD1 ERV GROWTH2 PARIS 2,080 15,234 19,437 19,722 56,472 +137% 930 +2% +8% €/sqm/y MADRID 35 +4% +1% 10,890 6,934 32,657 26,297 76,779 +72% €/sqm

  12. Slide 12: Outstanding letting performance – 2nd highest volume in history

    02 Back to Growth in Operations Outstanding letting performance – 2nd highest volume in history > Colonial with strong letting activity: +75% on previous year (+114% in economic terms) > Acceleration in 2H 2021, doubling the letting volume of the previous year 2H > Letting activity focused on CBD as

  13. Slide 13: Renovation Program with solid progress on pre-lets

    02 Back to Growth in Operations Renovation Program with solid progress on pre-lets > Strong letting momentum on renovation program > Paris assets almost fully let Cézanne Saint Honoré Washington Plaza Prime CBD – 10,000 sqm Prime CBD – 10,000 sqm 1 Paris program almost fully let 90% 100% let let > 2

  14. Slide 14: Grade A CBD capturing market take-up benefitting from polarization trend

    02 Back to Growth in Operations Grade A CBD capturing market take-up benefitting from polarization trend PARIS MADRID BARCELONA Letting volume - sqm Letting volume - sqm Letting volume - sqm Total 56,472 Total 76,779 Total 37,093 Thereof CBD & 7ieme 55,226 Thereof CBD 45,076 Thereof CBD & 22@ 29,049

  15. Slide 15: Significant increase of occupancy up to 96%

    02 Back to Growth in Operations Significant increase of occupancy up to 96% > Letting Volume of more than 100.000 sqm in second half > Significant letting-up of new space increasing occupancy +256 bp in a quarter > Group Occupancy at 96% with Paris portfolio almost fully let (98.4%) SQM SIGNED EPRA

  16. Slide 16: Vacancy at healthy 4%: availability of top-quality product

    02 Back to Growth in Operations Vacancy at healthy 4%: availability of top-quality product 4% of available high-quality space with solid letting prospects > 1.9% renovation program assets in Paris & Madrid > 1.6% Grade A CBD premises in Barcelona & Madrid EPRA VACANCY Renovation Program Madrid 1.0%

  17. Slide 17: Solid Rental growth with acceleration at year end

    02 Back to Growth in Operations Solid Rental growth with acceleration at year end > Group ERV growth of +5%: Paris the strongest portfolio with +8% > ERV growth with significant acceleration in the last quarter of the year > Contract portfolio best positioned to capture momentum in indexation & ERV

  18. Slide 18: Project delivery with high capital gain margin

    02 Back to Growth in Operations Project delivery with high capital gain margin > Delivery of 2 prime projects in the CBD of Paris and Barcelona > Strong rental uplift & value creation on total cost > Long term secured GRI of €11m with Top Tier Tenants Diagonal 525 – CBD Barcelona 83 Marceau – Prime

  19. Slide 19: Strong financials underpinned by strong recovery of CBD

    03 Back to Growth in Financials Strong financials underpinned by strong recovery of CBD

  20. Slide 20: Gross Rental Income +2% like for like (Paris +3%)

    03 Back to Growth in Financials Gross Rental Income +2% like for like (Paris +3%) > Gross Rental Income +2% like for like (Paris +3% like for like) > GRI increase fully rental price driven (Barcelona outstanding with +3.4%) > Contract portfolio best positioned to capture momentum in indexation & ERV

  21. Slide 21: Net Rental Income at +3.3% like for like (Paris +6.4%)

    03 Back to Growth in Financials Net Rental Income at +3.3% like for like (Paris +6.4%) > Net Rental Income +3.3% like for like > Paris with outstanding +6.4% like for like in Net Rental Income > Madrid +2% like for like in NRI offsetting temporary correction in Barcelona LIKE-FOR-LIKE VARIANCE1 – NR

  22. Slide 22: GAV growth of +6% like for like (+4% in second half)

    03 Back to Growth in Financials GAV growth of +6% like for like (+4% in second half) > Strong +6% YoY like for like growth across all segments > Madrid with outstanding +7% like for like YoY growth > Significant value growth acceleration in 2H 2021 GAV 2021 GROWTH GAV VARIANCE LFL +6% LFL 2021 Full

  23. Slide 23: Solid profitability with enhanced quality

    03 Back to Growth in Financials Solid profitability with enhanced quality > Group Net Profit of €474m, +€471m vs previous year > Recurring Profit of €128m, double digit increase in comparable terms1 > Recurring EPS of 24.6 €Cts./share at the high range of guidance SOLID INCREASE IN NET PROFIT SOLID

  24. Slide 24: Recurring EPS at high end of guidance, +12% in comparable terms

    03 Back to Growth in Financials Recurring EPS at high end of guidance, +12% in comparable terms1 > Comparable Recurring EPS of 30.43 €cts/share, +12% vs. previous year > Temporary EPS decrease mainly due to disposals & renovation program acceleration > Disposals of non-core: capital recycling for ne

  25. Slide 25: Active Balance Sheet Management & Green Bond Conversion

    03 Back to Growth in Financials Active Balance Sheet Management & Green Bond Conversion > 100% Green Bond Conversion: unique on the IBEX-35 and in the Spanish Real Estate Sector > Improved debt profile & financing cost through active liability management > Solid Capital structure for additional grow

  26. Slide 26: Strong Total Shareholder Return

    03 Back to Growth in Financials Strong Total Shareholder Return > Total Shareholder Return1 (NTA based) of +9% > NTA of 12.04€/share, +7% growth YoY > Acceleration of NTA growth in 2H 2021 EPRA NET TANGIBLE ASSETS (EPRA NTA) TOTAL SHAREHOLDER RETURN 1 €/share Capital Value Creation 2021 0,25 (0,22)

  27. Slide 27: Increasing ambition on Net Zero

    04 Leadership on ESG & Decarbonization Increasing ambition on Net Zero

  28. Slide 28: Decarbonization Strategy on track

    04 Leadership on ESG & Decarbonization Decarbonization Strategy on track LEADERSHIP ON DECARBONIZATIN & ECOEFFICENCY DECARBONIZATION PLAN ON TRACK Scope 1&2 (KgCo2e/sqm) 30 Executed 25 YTD LFL -5% 25 Net Zero 21 Target-25% 20 2030 15 -45% 10 Targeted -65% CARBON DISCLOSURE PROJECT GRESB 8 Plan 6 SCO

  29. Slide 29: Leadership on ESG Rating

    04 Leadership on ESG & Decarbonization Leadership on ESG Rating SUSTAINABILITY INDICES PERFORMANCE VIGEO RATING SUSTAINALYTICS RATING MSCI ESG RATING FTSE4GOOD RATING SCORE: A1+ SCORE: 10.1 in ESG risk SCORE: A SCORE: 4/5 > Top 3% of the 4,892 companies > Top 21 of the 431 listed real > High Scoring

  30. Slide 30: Accelerating Growth in 2022 – 2023

    05 Accelerating Growth in 2022 – 2023 Superior growth & returns through prime positioning

  31. Slide 31: Accelerating growth in 2022 – 2023

    05 Accelerating growth in 2022 – 2023 ACCELERATION OF EPS GROWTH IN 2022 & 23 1 SFL Acquisition - Alpha VI 2 Project Pipeline on track 3 Renovation Program with positive momentum 4 Alpha VII - Acquisition Program relaunched 5 Indexation & Rental Growth 31

  32. Slide 32: SFL Acquisition - Alpha VI

    05 Accelerating growth in 2022 – 2023 1 SFL Acquisition - Alpha VI > SFL transaction successfully closed: Colonial’s stake increased up to 98.3% > Buying into strong Paris prime market at optimal market timing > Streamlined Pan-European Platform to accelerate EPS and NTA growth SFL TRANSACTION SUCCE

  33. Slide 33: Project Pipeline Pre-Letting on track

    05 Accelerating growth in 2022 – 2023 2 Project Pipeline Pre-Letting on track > More than €79m of additional rents to flow into the recurring P/L > €28m of secured rents through solid pre-let performance > Project pipeline delivery & pre-letting process on track GLA Total1 Yield Capital Gain GRI2 Pa

  34. Slide 34: Renovation Program with positive momentum

    05 Accelerating growth in 2022 – 2023 3– Renovation Program with positive momentum > Significant progress in letting up the renovation program > Passing rents have doubled in 6 months up to €17m of annualized GRI > Reversion of €30m annualized GRI secured as of 12/21 RENOVATION PROGRAM SIGNIFICANT G

  35. Slide 35: Alpha VII - Acquisition Program relaunched

    05 Accelerating growth in 2022 – 2023 4 Alpha VII - Acquisition Program relaunched Launch of a new acquisition program: more than €500m generating more than €20m of rents 1 Paris City Center 15eme 39,500 sq m – Amundi HQ Opportunistic Acquisition at attractive terms > €500m Investment ✓ Purchase Opt

  36. Slide 36: Rental Growth & Indexation

    05 Accelerating growth in 2022 – 2023 5 Rental Growth & Indexation > Strong reversion to be secured, especially in Paris and Barcelona > Contract portfolio well positioned to benefit from indexation > Grade A portfolio to capture rental growth of CBD market on the back of market recovery 1. STRONG R

  37. Slide 37: Colonial platform with several growth drivers in place

    05 Accelerating growth in 2022 – 2023 Colonial platform with several growth drivers in place Colonial platform with several growth drivers in place > Full impact of SFL acquisition to come through > Delivery of Project Pipeline & Renovation Program > New Acquisition Program with additional rental in

  38. Slide 38: Conclusion & Outlook

    07 Conclusion & Outlook

  39. Slide 39: Strong EPS growth expected in 2022

    07 Conclusion & Outlook Strong EPS growth expected in 2022 2021 – BACK TO GROWTH WITH SOLID RESULTS ON ALL METRICS > Superior NTA Total Return & Value Creation > Solid Profitability with strong like for like growth in earnings & value > Outstanding operational performance with increasing momentum >

  40. Slide 40: Q&A

    Q&A

  41. Slide 41: Solid profitability with enhanced quality

    APPENDICES Solid profitability with enhanced quality > Group Net Profit of €474m, +€471m > Recurring Profit impacted by disposals & renovation program acceleration > Comparable Recurring EPS of 30.43 €cts/share, +12% vs. previous year level PROFIT & LOSS ACCOUNT GROUP NET PROFIT €m Value Creation th

  42. Slide 42: Capital Recycling & Acquisitions to enhance growth profile

    APPENDICES Capital Recycling & Acquisitions to enhance growth profile > Ongoing flight to quality through active portfolio management > Disposals of more than €2bn of mature and/ or non-core product > Acquisitions of more than €4bn of assets reloading the Prime Exposure ONGOING FLIGHT TO QUALITY THR

  43. Slide 43: Alpha VII - Acquisition of the Amundi headquarters in Paris

    APPENDICES Alpha VII - Acquisition of the Amundi headquarters in the center of Paris > Large Scale efficient asset at one of the best transportation hubs in the city center of Paris > Core investment with secured rents for the coming 12 years and limited capital deployment 91 Boulevard Pasteur, Pari

  44. Slide 44: Alpha VII - Acquisition of Buenos Aires, in Barcelona CBD

    APPENDICES Alpha VII - Acquisition of Buenos Aires, 21 in Barcelona CBD > Opportunistic investment of 8,784 sqm of office space in Barcelona’s CBD > Efficient asset at attractive pricing with secured rents & value-added potential Buenos Aires 21, Barcelona CBD Barcelona CBD Real Estate Rationale > S

  45. Slide 45: Project pipeline – GRI reversionary potential going forward

    APPENDICES Project pipeline – GRI reversionary potential going forward > More than €79m of additional rents to flow into the recurring P/L > €28m of secured rents through solid pre-let performance > Prime Project pipeline delivery on track GLA Total 1 Yield Project City % Group Delivery (sqm) Cost €

  46. Slide 46: Project pipeline – significant value creation potential going forward

    APPENDICES Project pipeline – significant value creation potential going forward > Prime Project pipeline delivery on track with high capital gain margins YTD > 2 out of 9 projects already delivered in 2021 > Significant additional capital value creation potential to be crystalized GLA Total 1 Yield

  47. Slide 47: Rental Price levels remain solid

    APPENDICES Rental Price levels remain solid during RELEASE SPREAD1 GROWTH ON SIGNED RENTS2 Washington Plaza Diagonal 682 Diagonal 409 90 Champs-Elysées Cedro 103 Grenelle +3% +40% +48% +37% +22% +9% Diagonal, 609 Illacuna Santa Engracia Puerto de Somport, 8 Recoletos 27 Via Augusta +47% +25% +17% +3

  48. Slide 48: Investment markets for prime product remain active - Paris

    APPENDICES Investment markets for prime product remain active > Paris CBD an attractive target for International Investors > Attractive Pricing for Core product in CBD 1, François 1er CBD €84m 3,400 sqm 2.20% Yield (3Q 2021) Théodore CBD €80m 3,400 sqm 2.48% Yield (2Q 2021) 59 Haussmann CBD €237m 10

  49. Slide 49: Investment markets for prime product remain active - Barcelona

    APPENDICES Investment markets for prime product remain active > Barcelona leading the investment market in Spain – specially in the 22@ district Tanger, 36 22@ €67m 8,415sqm €7,976/sqm (3Q 2021) Torre Sabadell CBD €90m 12,000 sqm €7,500/sqm (4Q 2021) Pre-Capex BARCELONA Tanger, 66 22@ €50m 7,2111 sq

  50. Slide 50: Investment markets for prime product remain active - Madrid

    APPENDICES Investment markets for prime product remain active > Investor appetite with increased momentum for Prime in Madrid Goya, 1 CBD €35m 1,850m €18,919/sqm (3Q 2021) *Commercial component Castellana 42 CBD €54m 4,500m €12,000/sqm (3Q 2021) MADRID Francisco Gervás, 10 CBD €70m 8,000 sqm €8,750/

  51. Slide 51: Investment markets with enhanced momentum for Prime

    APPENDICES Investment markets with enhanced momentum for Prime > Colonial portfolio with additional potential for yield compression > Prime market yields & scarcity value as driver > Prime Yields at very attractive spreads compared to reference rates VALUATION YIELDS (1) BARCELONA MADRID PARIS Colon

  52. Slide 52: AAA Clients with strong solvency

    APPENDICES AAA Clients with strong solvency CONTRACT PORTFOLIO 2021 MATURITIES – DELIVERY YTD ON TRACK 2022 MATURITIES – MIX 2022 MATURITIES BREAKDOWN % on annualized Group GRI Madrid 18.8% 1.2% 7.2% 10.4% 4.6% 25% 71 5 27 Paris 53% Barcelona 22% Paris 39 Madrid 17 Barcelona Group Signed & Not Stays

  53. Slide 53: Environment: Excellence on ESG & Decarbonization

    APPENDICES Environment: Excellence on ESG & Decarbonization OUTSTANDING RATING RESULTS BENCHMARK / INDEX ACHIEVEMENT / RATING CDP Score at A confirming decarbonization leadership > The sole Office Real Estate company in Europe > Among the only 5 real estate companies in Europe > Among the only 12 re

  54. Slide 54: CDP Score at A confirming decarbonization leadership

    APPENDICES Environment: Excellence on ESG & Decarbonization CDP Score at A confirming decarbonization leadership > Scoring of A: well above Europe regional average and Financial services sector > Strong YoY momentum: increase up to A coming from A- GLOBAL CDP SCORE REACHING THE “A” LIST > The sole O

  55. Slide 55: Continuous improvement on GRESB performance

    APPENDICES Environment: Excellence on ESG & Decarbonization CONTINUOUS IMPROVEMENT ON GRESB PERFORMANCE 90 94 +56% 77 60 61 34pts 2017 2018 2019 2020 2021 55

  56. Slide 56: Continuous improvement on GRESB performance

    APPENDICES Environment: Excellence on ESG & Decarbonization CONTINUOUS IMPROVEMENT ON GRESB PERFORMANCE 56

  57. Slide 57: www.inmocolonial.com

    www.inmocolonial.com © Colonial

Inmobiliaria Colonial SOCIMI — FY2021 Earnings Presentation on 6ix