Stoneweg European Stapled Trust · SGX:SEB
Stoneweg European Stapled Trust — Q1 2025 Earnings Presentation
42 slides from Stoneweg European Stapled Trust's earnings presentation, Apr 28, 2025
Slide 1: 1Q 2025 business update
1Q 2025 business update 28 April 2025
Slide 2: Introduction and highlights
Constituent of MSCI ACMI IMI (APAC) Credit ratings Constituent of Investment grade BBB- Investment grade BBB- Positive Outlook Stable Outlook ESG ratings Introduction and 8.8 Negligible Risk highlights Top in peer group Ranked 6th in SGTI 2024 Highest base score in the REIT and Business Trust catego
Slide 3: Quality logistics / light industrial and prime office portfolio
Quality logistics / light industrial and prime office portfolio Logistics/light industrial sector now with 56% weighting, heading upwards to > 60% €2.24 93% 56% ~86% 810 billion Freehold properties Logistics / light industrial, complemented by prime office Western Europe and the Nordics Tenant-custo
Slide 4: 1Q 2025 key highlights
1Q 2025 key highlights SERT in confident operational and capital management position with a rebased portfolio, successful €500m bond issuance, new sponsor integration and strong investor support including a well-received unit buyback Overall: - SERT’s operational position has strengthened - SERT has
Slide 5: 1Q 2025 score card: secured income growth and derisked debt book
1Q 2025 score card: secured income growth and derisked debt book Logistics / light Industrial up +9.6% NPI on a like for like and Office up +4.2% Financial highlights Capital management highlights €33.5 NPI +2.4% vs pcp 3.374 INDICATIVE DPU 3.7% lower than pcp +41.7% NET GEARING 1.5 p.p. higher than
Slide 6: Financial and capital management highlights
Financial and capital management highlights 6
Slide 7: 1Q 2025 financial highlights: +7.4% like-for-like NPI growth
1Q 2025 financial highlights: +7.4% like-for-like1 NPI growth 1Q 2025 impacted by higher interest costs from the new bond, partially offset by higher NPI 1Q 2025 commentary vs 1Q 2024 1Q 2025 1Q 2024 Financial performance €’000 €’000 Fav./ • 1Q 2025 gross revenue was largely in line with (Selected L
Slide 8: 31 March 2025 balance sheet
31 March 2025 balance sheet NAV €1.98/unit due to payment of distribution. Buyback of 338,000 units completed in 1Q 2025 As at 31 Mar 2025 As at 31 Dec 2024 €’000 €’000 (unless stated otherwise) (unless stated otherwise) Cash & cash equivalents 47,359 38,536 Receivables 38,003 21,617 Asset held for
Slide 9: Long 4.1 years WADE providing a stable debt position
Long 4.1 years WADE providing a stable debt position Issued new Series 002 6-year €500 million bond in January 2025 with full redemption of the Series 001 €450 million; New bond was almost 5x oversubscribed with over 100 institutional investors at a spread of 195 basis points 89% hedged with €150
Slide 10: 3M Euribor vs 6Y Euro swap chart and hedging position on unsecured bank loans
3M Euribor vs 6Y Euro swap chart and hedging position on unsecured bank loans 3-month Euribor has been dropping steadily and is currently around 2.30% with expectation to drop further 6-year swap has dropped recently however bond margins are higher given the additional volatility and risk caused by
Slide 11: Ample liquidity and investment-grade quality capital metrics
Ample liquidity and investment-grade quality capital metrics New €500 Bond issued in January 2025 for 6-year term increases WADE to above 4 years • 41.7% net gearing slightly above the Board policy (35-40% in the medium term) but below Policy ceiling 45% • Other metrics comfortably within bond/loan
Slide 12: 1Q 2025 portfolio and asset management highlights
1Q 2025 portfolio and asset management highlights 12
Slide 13: Long-dated lease profile enhances cash flow visibility
Long-dated lease profile enhances cash flow visibility Logistics / light industrial 5.2 years Office 5.1 years WALE WALE % by WALE % by WALB % by WALE % by WALB 54.4% 59.1% 38.9% 35.9% 22.5% 19.5% 15.3% 16.4% 16.5% 14.5% 15.9% 13.1% 12.8% 12.2% 10.5% 11.1% 10.5% 7.7% 6.9% 6.4% 2025 2026 2027 2028 20
Slide 14: Core Western Europe portfolio's blended occupancy high at >93%
Core Western Europe portfolio’s blended occupancy high at >93% Total portfolio occupancy dipping temporarily to 92%, with the Western European portfolio achieving 93.1% Central Eastern European portfolio dipping slightly to 85.9%, mostly due to less space renewed in Poland 5-year occupancy by countr
Slide 15: Logistics / light industrial: occupancy stabilised at 94%
Logistics / light industrial: occupancy stabilised at 94% Occupancy remained stable at 94.0%, with a minor 0.2% dip since year-end 2024, primarily due to the non-renewal of 8,000 sqm at Parc des Docks – which is expected to be re-leased soon at higher rents 5-year occupancy by country1 Weighting by
Slide 16: Logistics / light industrial: long WALE and +4.9% rent reversion
Logistics / light industrial: long WALE and +4.9% rent reversion Occupancy in the sector led by higher light industrial occupancy 5-year rent reversion (%) Sector performance highlights 40.0% 30.0% Logistics / Light industrial: +4.9% WALE Logistics: +7.6% 20.0% Light industrial: +4.4% 5.2 years 10.0
Slide 17: Logistics / light industrial leasing highlights
Logistics / light industrial leasing highlights Healthy leasing activity in Denmark, Veemarkt and the Netherlands Significant 10-year new lease signed for a total of 3,407 sqm at Parc du Landy in France OCCUPANCY OCCUPANCY OCCUPANCY 100% 100% 98.9% Fabriksparken 20 Veemarkt Parc du Landy Denmark The
Slide 18: Office portfolio: temporary dip in Dutch occupancy rate
Office portfolio: temporary dip in Dutch occupancy rate Overall occupancy has declined to 85.7%, partly due to fall in Haagse Poort’s occupancy in the Netherlands due to NN Group’s optimisation/lease extension/upgrade – advanced lease negotiations for new tenant for most vacant space at higher rents
Slide 19: Office portfolio: prolonged WALE and slightly negative reversion
Office portfolio: prolonged WALE and slightly negative reversion • Long WALE of 5.1 years in 1Q 2025 and slight -0.6% rent reversion (NN's positive reversion to be included in 2Q) • Large lease renewal for 9,599 sqm at +1.4% rent reversion at Central Plaza in the Netherlands Office portfolio highlig
Slide 20: SERT's office portfolio is majority future-proofed, benefitting from structural trends
SERT’s office portfolio is majority future-proofed, benefitting from structural trends Occupiers are focused on smaller footprints but best-in-class space as hybrid working patterns settle CBRE estimates that only 20% of European office stock is aligned to tenant demand vs. SERT’s 83% SERT str
Slide 21: Office leasing highlights
Office leasing highlights Significant 5.5-year lease renewal for 9,599 sqm with +1.4% rent reversion at Central Plaza in the Netherlands Significant 7-year lease renewal with Motorola as the anchor tenant at Green Office in Poland OCCUPANCY OCCUPANCY OCCUPANCY 97.5% 97.4% 77.0% Central Plaza Bastion
Slide 22: Ongoing and upcoming AEIs further augment portfolio's quality
Ongoing and upcoming AEIs further augment portfolio’s quality Nove Mesto ONE Industrial Park I, DC8, Spennymoor, UK De Ruijterkade 5, Amsterdam, The Slovakia (upcoming, committed) (upcoming, committed) Netherlands (upcoming, early planning) €5 million (estimated cost) €10 million (estimated cost) €1
Slide 23: Economic and market commentary
Economic and market commentary 23
Slide 24: Europe is vulnerable to the tariff war in the short term; public investment expected to raise demand
Europe is vulnerable to the tariff war in the short term; Public investment is expected to raise demand in the long term Heightened global uncertainty has encouraged Europe to pursue reforms that will support long-term resilience The negative: short-term The positive: mid-to long-term Commentary P
Slide 25: Policy changes and significant increase in defence spending by Europe is starting to show in the data
Policy changes and significant increase in defence spending by Europe is starting to show in the data US policy shifts are leading European governments to look domestically for defense procurements • European aerospace and defence manufacturers are boosting production; this rising government demand
Slide 26: European logistics – reducing vacancy trends and market rental growth
European logistics – reducing vacancy trends and market rental growth Vacancy is expected to increase slightly in 2025 due to increased pipeline activity at the end of 2024 • CBRE expects that occupational outlook will improve from here on, subject to consumption activity and impact from tariffs • R
Slide 27: Positive European office market trends
Positive European office market trends Office-based jobs and limited supply leads to falling vacancy driving rental growth • Job creation is closely corelated with occupier demand • CBRE forecast each key cities expected job growth, averaging 1%pa job growth over next 5 years (LHS chart) • CBRE fore
Slide 28: European office market – rent trends
European office market – rent trends Rents growing faster than inflation in many European office markets especially in markets with strong job growth • Prime office rents expected to keep up / Prime real rent change % per annum five years to end 2Q 2030 outpace with inflation in many markets • In ag
Slide 29: Conclusion
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Slide 30: Key priorities for 2025
Key priorities for 2025 Take strategic steps within SERT’s portfolio to unlock value and generate alpha, to catalyse positive unit price performance to close the gap to NAV/unit and to deliver sustainable, risk adjusted returns Active asset Disciplined capital Investment strategy Sustainability mana
Slide 31: Appendix
Appendix 31
Slide 32: Resilient and diversified majority Western-European portfolio
Resilient and diversified majority Western-European portfolio • ~86% weighted to Western Europe; 6.2% portfolio initial yield / 7.9% portfolio reversionary yield By geography By asset class SERT operates in countries with high sovereign ratings Poland 7.0% Netherlands AAA / Sta Others 2.0% Slovakia
Slide 33: Highly diverse tenant-customer roster underpins cashflow
Highly diverse tenant-customer roster underpins cashflow • No single industry trade sector represents >16.0%1 of the portfolio • Top 10 tenant-customers at only 21%1 of the total headline rent • c. 90%1 of SERT’s tenants are large MNCs and government/semi-government tenant-customers Top 10 tenant-cu
Slide 34: Portfolio to benefit from structural trends (logistics/light industrial)
Portfolio to benefit from structural trends (logistics/light industrial) Nearshoring is a long-term trend that is just starting to gather momentum Global markets most appealing for nearshoring in 2024 54% Rank Country Region 1. Portugal EMEA have increased / near-shored 2. Czech Republic EMEA invent
Slide 35: SERT's portfolio operational statistics
SERT’s portfolio operational statistics Carrying Value2 Reversionary Number of No. of Assets NLA (sqm)1 (€ million) Initial Yield3 (%) Yield4 (%) Occupancy (%)1 Leases1 The Netherlands (total) 14 247,830 607.6 5.5 8.0 94.1 207 •Logistics / Light Industrial 7 70,043 107.6 5.1 6.0 99.6 145 •Office 7 1
Slide 36: SERT's portfolio overview as at 31 March 2025
SERT’s portfolio overview as at 31 March 2025 104 well-located properties across European gateway cities with average portfolio initial yield of 6.2% and a longer-term reversionary yield of 7.9% The Netherlands Denmark Properties 14 Properties 12 Properties 104 247,830 152,433 Lettable Area (sqm) Le
Slide 37: SERT's portfolio composition
SERT’s portfolio composition Commentary • SERT’s portfolio has a weighting of 55.7% to logistics / light industrial as at 31 March 2025, further advancing the Manager’s stated strategy of pivoting SERT to a majority weighting of this sector 37
Slide 38: European real estate pricing has stabilised as investment volumes slowly rise
European real estate pricing has stabilised as investment volumes slowly rise Office remains the largest sector in 1Q2025, followed by living and logistics sectors European investment volumes, € bn 400 350 300 5 year average of €268 billion 250 200 150 100 50 0 1Q 2025 2007 2008 2009 2010 2011 2012
Slide 39: Logistics sector investment volumes improved in 2024
Logistics sector investment volumes improved in 2024 France, Denmark and the Netherlands are particularly strong markets • European industrial and logistics investment increased 21% during 2024 to €40.5bn, up from €33bn in 2023 • Total volumes for Q4 were 32% higher at €13.95 bn, making it the stron
Slide 40: Key economic forecasts in Eurozone
Key economic forecasts in Eurozone Annual forecasts 2022 2023 2024E 2025E 2026E 2027E Commentary GDP 3.6 0.5 0.8 0.8 1.0 1.7 • Oxford Economics downgraded Private consumption 5 0.6 1.0 1.5 1.5 1.7 Eurozone GDP growth forecast due to Fixed investment the escalating trade war, including the 2.1 2.0 -2
Slide 41: Disclaimer
Disclaimer This presentation is for information purposes only and does not constitute or form legal, financial or commercial advice, or a recommendation of any kind, part of an offer, invitation or solicitation of any offer to purchase or subscribe for any securities of SERT in Singapore or any othe
Slide 42: If you have any queries, kindly contact
If you have any queries, kindly contact Investors: Stoneweg EREIT Management Pte. Ltd. Elena Arabadjieva Chief Operating Officer & Head of Investor Relations elena.arabadjieva@stoneweg.com.sg +65 6920 7539 Dimas Ardhanto Manager, Investor Relations dimas.ardhanto@stoneweg.com.sg +65 6920 7539 Media:
Stoneweg European Stapled Trust — Q1 2025 Earnings Presentation on 6ix