Covivio Sa · EURONEXT:COV
Covivio Sa — Investor Day (November 2019)
112 slides from Covivio Sa's investor day presentation, Nov 7, 2019
Slide 1: Capital Markets Day France Offices
CAPITAL MARKETS DAY FRANCE OFFICES PARIS 7 NOVEMBER 2019
Slide 2: Agenda of the day
AGENDA OF THE DAY MORNING – 10:00 am to 12:00 pm Presentation on Covivio France Offices strategy Lunch - 12:00 pm to 1:00 pm AFTERNOON – 1:00 pm to ~3:30 pm Asset tour in Paris CBD, Paris 17th North & Levallois End of the asset tour in Porte Maillot (metro line 1, RER A, taxi) CMD 2019 2
Slide 3: Summary of the presentation
SUMMARY OF THE PRESENTATION I. INTRODUCTION 05 Christophe KULLMANN, CEO II. GREATER PARIS OFFICE MARKET 19 Charles BOUDET, CEO JLL France & Virginie HOUZE, Head of Research JLL France III. COVIVIO FRANCE OFFICES STRATEGY 21 Olivier ESTEVE, Deputy CEO ; Marielle SEEGMULLER, Operations Director ; Laur
Slide 4: Today's presentation objectives
TODAY’S PRESENTATION OBJECTIVES FOCUS ON FRANCE OFFICES & DEVELOPMENT PIPELINE 1 Our portfolio has a significant growth potential 2 Our development pipeline will deliver solid revenue & value growth 3 Our portfolio will fuel this pipeline in the short & medium term, especially in Paris We are broade
Slide 5: Introduction
I. INTRODUCTION THE SUCCESS OF OUR BUSINESS MODEL INTRODUCTION TO THE OFFICES STRATEGY
Slide 6: Covivio, a diversified specialist
COVIVIO, A DIVERSIFIED SPECIALIST A €23 BN1 INTEGRATED PORTFOLIO BUILT ON 3 STRATEGIC PILLARS DIVERSIFIED BY ACTIVITY2 FOCUS ON MAJOR 1 EUROPEAN CITIES OFFICES RESIDENTIAL HOTELS €10.9 bn €6.1 bn €5.4 bn DEVELOPMENT 57% 26% 15% 2 PIPELINE And <2% non-strategic DIVERSIFIED BY GEOGRAPHY2 CLIENT 3 FOCU
Slide 7: Sustainable high occupancy and long leases
A SUCCESSFUL BUSINESS MODEL / SUSTAINABLE HIGH OCCUPANCY AND LONG LEASES 7.3 7.2 7.1 7.0 6.6 6.4 6.1 6.0 years on 5.8 5.8 5.5 average 97.1% 96.3% 96.7% 98.0% 98.1% 97.9% 94.8% 95.8% 95.5% 96.0% 96.6% on average 2010 2011 2012 2013 2014 2015 2016 2017 2018 Q3 2019 Occupancy rate Firm average lease le
Slide 8: Excellent track record on the development pipeline
A SUCCESSFUL BUSINESS MODEL / EXCELLENT TRACK RECORD ON THE DEVELOPMENT PIPELINE 2010-2019 10 YEARS OF SUCCESSFUL DEVELOPMENT PROJECTS 61 €2.4 BN 96% PROJECTS DEVELOPMENT COST1 OCCUPANCY IN THE YEAR OF THE DELIVERY 480,000 m² OF OFFICES 2,870 HOTEL ROOMS 7% 30% YIELD ON COST VALUE CREATION AT DELIVE
Slide 9: Introduction
I. INTRODUCTION THE SUCCESS OF THE BUSINESS MODEL INTRODUCTION ON THE OFFICES STRATEGY
Slide 10: Covivio Offices Strategy
COVIVIO OFFICES STRATEGY 1 2 3 HIGH-QUALITY STRONG ENHANCING PORTFOLIO DEVELOPMENT OUR CLIENT-FOCUS PIPELINE CMD 2019 10
Slide 11: A high-quality, well located offices portfolio
1 - A HIGH-QUALITY, WELL LOCATED OFFICES PORTFOLIO €10.9 bn €9.0 bn Group share Attractive locations in France, Italy & Germany… …focused on dynamic markets 95% LOCATED IN1 Rent increase for new space in Greater Paris, Milan & Berlin PARIS €2.2 bn Group share +6 % GREATER PARIS 2 €2.6 bn MILAN BERLI
Slide 12: France offices portfolio: dynamic locations with potential
FRANCE OFFICES PORTFOLIO / DYNAMIC LOCATIONS WITH POTENTIAL Portfolio 96% in strategic locations Strong development pipeline Paris (38%) 1.6 million m² 750,000 m² Major business districts in Greater Paris (45%) of offices of redevelopments & new constructions €6.8 bn €4.7 bn €5.7 bn of projects Grou
Slide 13: Italy offices portfolio: focus on Milan
ITALY OFFICES PORTFOLIO / FOCUS ON MILAN Portfolio 90% in Milan1 Strong development pipeline 1.6 million m² M3 170,000 m² M5 of offices of redevelopments & new constructions Bicocca M1 M2 Certosa Maciachini M1 Porta Nuova City Life M5 Semi-centre Lambrate / €3.9 bn Forlanini M1 Lorenteggio CBD M4 €0
Slide 14: Accelerating in offices in Germany (1/2)
ACCELERATING IN OFFICES IN GERMANY (1/2) Increasing take-up: +7% per year on average over last 5 years SUPPORTIVE MARKET Low vacancy rate: 4.1% 1 IN THE MAJOR GERMAN CITIES1 Lack of supply : space under construction2 = 40% of yearly take-up Existing teams for Asset Management & Property management E
Slide 15: Accelerating in offices in Germany (2/2)
ACCELERATING IN OFFICES IN GERMANY (2/2) A flagship development … already €200 million …and ~€90 million project… of offices in our portfolio… of investments secured in 2019 BERLIN ALEXANDERPLATZ IN BERLIN IN BERLIN EBERSWALDER BERLIN 60,000 m² mixed-use project 67,000 m² over 15 assets Acquisition
Slide 16: Significant and growing development pipeline potential
2 - SECOND PILLAR OF THE STRATEGY / DEVELOPMENT PIPELINE A SIGNIFICANT & GROWING POTENTIAL IDENTIFIED IN OUR PORTFOLIO €8.0 bn €6.8 bn group share +1/3 TOTAL EUROPEAN €6.0 bn PIPELINE €4.4 bn group share €2.0 bn €1.3 bn German residential, hotels & mixed-use €2.0 bn Offices in Italy & Germany €1.2 b
Slide 17: Client-focused approach since the beginning
3 – CLIENT-FOCUSED APPROACH SINCE THE BEGINING 2001 - 2007 2008 - 2018 TODAY MAIN Location | Cost Location | Well-being | Flexibility CLIENT Location | Cost Energy performance Cost | Sustainability NEEDS • Property development • Acceleration of developments • Sale & leaseback • Building long-term •
Slide 18: Deploy our solutions throughout our portfolio
DEPLOY OUR SOLUTIONS THROUGHOUT OUR PORTFOLIO BE CLOSE TO IMPROVE LIFE OFFER FLEXIBLE IMPROVE OUR EFFICIENCY OUR END-USERS IN OUR BUILDINGS SOLUTIONS THROUGH DIGITALIZATION Survey of Implement new services Deploy our flexible Digital roadmap 1,300 end-users to respond to their workspace offer, for t
Slide 19: Greater Paris Office Market
II. GREATER PARIS OFFICE MARKET JLL FRANCE
Slide 20: Presentation on the Greater Paris office market by JLL
PRESENTATION ON THE GREATER PARIS OFFICE MARKET BY JLL 1 / Office top trends: Human Experience, Digital & Flex Charles BOUDET, CEO of JLL France 2 / The Office market in Greater Paris Virginie HOUZÉ, Head of Research at JLL France CMD 2019 20
Slide 21: Covivio France Offices Strategy
III. COVIVIO FRANCE OFFICES STRATEGY III-A. DEVELOPMENT PIPELINE - SUCCESSFUL COMMITTED PROJECTS - POTENTIAL IN OUR PORTFOLIO III-B. CLIENT-ORIENTED STRATEGY - MORE SERVICES IN OUR PORTFOLIO - FLEX-WORKSPACE OFFER - DIGITALIZATION
Slide 22: A significant pipeline located mainly in Paris
Total France offices pipeline €4.7 bn Committed projects €1.4 bn Managed projects €3.3 bn A SIGNIFICANT PIPELINE LOCATED MAINLY IN PARIS €1.4 bn committed projects €4.7 bn development pipeline in France offices €4.3 bn Group share €3.3 bn managed projects ~50% in Paris ~35% in Greater Paris business
Slide 23: Capacity to renew our development projects
CAPACITY TO RENEW OUR DEVELOPMENT PROJECTS ACCELERATING THE PACE OF COMMITMENTS & FUELLING THE PIPELINE WITH FUTURE PROJECTS €4.7 bn TOTAL FRANCE €2.8 bn €2.7 bn OFFICES PIPELINE €2.6 bn at 100% X2.5 €1.3 bn €3.3 bn €1.7 bn €1.4 bn €1.4 bn +30% MANAGED PROJECTS €2.2 bn €1.1 bn COMMITTED PROJECTS x3
Slide 24: Committed projects in attractive locations
Total France offices pipeline €4.7 bn Committed projects €1.4 bn Managed projects €3.3 bn €1.4 BN OF COMMITTED PROJECTS IN ATTRACTIVE LOCATIONS (€1.1 BN GS) 86% 8% Paris and Greater Paris Lyon Silex 2 Lyon Part-Dieu 210,000 m² Levallois ALIS Paris 17 So Pop Paris 17 N2 Paris 8 Jean Goujon 5.8% yield
Slide 25: Levallois, a historic business district
Total France offices pipeline €4.7 bn Committed projects €1.4 bn Managed projects €3.3 bn LEVALLOIS / A HISTORIC BUSINESS DISTRICT OFFICE STOCK ~950,000 M² Thais Delivered in 2016 ASSET TOUR - SEPTEMBER CMD 20192019 25
Slide 26: Levallois Alis, a prime redevelopment
Total France offices pipeline €4.7 bn Committed projects €1.4 bn Managed projects €3.3 bn LEVALLOIS ALIS / A PRIME REDEVELOPMENT An attractive investment … … for redevelopment into a prime asset … … with limited risks 2000 €215 m 5.0% ► SCARCITY OF NEW SPACE ACQUISITION OF BLOCKS A & C TOTAL YIELD A
Slide 27: Paris 17 – Clichy – Saint-Ouen dynamic area
Total France offices pipeline €4.7 bn Committed projects €1.4 bn Managed projects €3.3 bn PARIS 17 – CLICHY - SAINT-OUEN / A DYNAMIC AREA IN THE NORTH OF PARIS OFFICE STOCK ~1.2 MILLION M² New Paris courthouse 27
Slide 28: Paris So Pop, flagship demolition-reconstruction project
Total France offices pipeline €4.7 bn Committed projects €1.4 bn Managed projects €3.3 bn PARIS SO POP / A FLAGSHIP DEMOLITION-RECONSTRUCTION PROJECT An attractive investment … … for redevelopment into a prime asset … … with limited risks 2012 ACQUISITION OF CITROËN HQ AT 8.1% YIELD €226 m 6.1% ► AT
Slide 29: Malakoff-Montrouge-Chatillon business district
Total France offices pipeline €4.7 bn Committed projects €1.4 bn Managed projects €3.3 bn MALAKOFF-MONTROUGE-CHATILLON BUSINESS DISTRICT OFFICE STOCK ~1 MILLION M² 8 min Transport HUB Chatillon-Montrouge 8 min 29
Slide 30: Flow & IRO construction projects
Total France offices pipeline €4.7 bn Committed projects €1.4 bn Managed projects €3.3 bn FLOW & IRO / TWO HIGH-QUALITY CONSTRUCTION PROJECTS An attractive investment … … for redevelopment into prime assets … … with limited risks 2015 TOTAL COST 100% 20% ACQUISITION OF FLOW, A VACANT ASSET FLOW PRE-
Slide 31: Covivio France Offices Strategy
III. COVIVIO FRANCE OFFICES STRATEGY III-A. DEVELOPMENT PIPELINE - SUCCESSFUL COMMITTED PROJECTS - POTENTIAL IN OUR PORTFOLIO III-B. CLIENT-ORIENTED STRATEGY - MORE SERVICES IN OUR PORTFOLIO - FLEX-WORKSPACE OFFER - DIGITALIZATION
Slide 32: Significant potential in our portfolio to renew our pipeline
Total France offices pipeline €4.7 bn Committed projects €1.4 bn Managed projects €3.3 bn SIGNIFICANT POTENTIAL IN OUR PORTFOLIO TO RENEW OUR PIPELINE… ~ 550,000 m² €3.3 BN >35% OF OFFICES TOTAL COST POTENTIAL VALUE CREATION €3.2 BN GROUP HARE 1 REDEVELOPMENT OF “HISTORIC” ASSETS €1.2 bn 2 LAND BANK
Slide 33: Located in key strategic markets
Total France offices pipeline €4.7 bn Committed projects €1.4 bn Managed projects €3.3 bn …LOCATED IN KEY STRATEGIC MARKETS Lille MAJOR Paris REGIONAL CITIES 50% 20% 30% Greater Paris Lyon Bordeaux CMD 2019 33
Slide 34: Attractive locations in Paris & Greater Paris
Total France offices pipeline €4.7 bn Committed projects €1.4 bn Managed projects €3.3 bn ATTRACTIVE LOCATIONS IN PARIS & GREATER PARIS Saint Ouen Saint Denis Pleyel Victor Hugo Redevelopment 360,000 Levallois Pereire CAP 18 Land Banks m² Selective acquisition Laborde Carnot Jemmapes Provence Anjou
Slide 35: Redevelopments of historic assets
REDEVELOPMENTS OF “HISTORIC” ASSETS
Slide 36: A strong track record of redevelopment
Total France offices pipeline €4.7 bn Committed projects €1.4 bn Managed projects €3.3 bn A STRONG TRACK RECORD OF REDEVELOPMENT PARIS MENILMONTANT Full Redevelopment – 2017 4,500 m² ORANGE ACQUISITION: 2006 STAYED AS TENANT TOTAL YIELD VALUE COST ON COST CREATION €26 m 5.2% 41% LEVALLOIS THAIS Demo
Slide 37: A pipeline mainly located in Paris
Total France offices pipeline €4.7 bn Committed projects €1.4 bn Managed projects €3.3 bn A PIPELINE MAINLY LOCATED IN PARIS… TOTAL 11 ASSETS Levallois Pereire COST 88,000 €1.2 m² Laborde Jemmapes Carnot Provence Anjou Voltaire BN AVERAGE RENT 419 €/m² Keller Raspail AVERAGE VALUE Boulogne Molitor B
Slide 38: Prime or emerging areas in Paris
Total France offices pipeline €4.7 bn Committed projects €1.4 bn Managed projects €3.3 bn … IN PRIME OR EMERGING AREAS IN PARIS GROWTH IN PRIME RENTS IN PARIS BY AREA OVER 10 YEARS PARIS PARIS PARIS PARIS PARIS PARIS PARIS ÉTOILE OPÉRA 3/4/10/11 5/6/7 12/13 14/15 18/19/20 900 €/m² Prime Rent 2019 85
Slide 39: Short-term projects
Total France offices pipeline €4.7 bn Committed projects €1.4 bn Managed projects €3.3 bn SHORT-TERM PROJECTS LABORDE 8th ANJOU 8th CARNOT 17th 6,200 m² 10,100 m² 11,200 m² SURFACE SEE 35,000 m² FOCUS TOTAL COST EXPECTED €0.6 RENTAL INCREASE 2020 2021 2022 ~45% BN PROVENCE 9th TARGET 7,500 m² VALUE
Slide 40: Focus: Anjou redevelopment potential in the CBD
Total France offices pipeline €4.7 bn Committed projects €1.4 bn Managed projects €3.3 bn FOCUS / ANJOU, LARGE REDEVELOPMENT POTENTIAL IN THE CBD TODAY Saint Lazard Train Station 10,100 m² Saint- let to Orange until 2021 Augustin Current rent Madeleine €560/m² on offices Orange Anjou Palais de l'Ely
Slide 41: Medium-term projects
Total France offices pipeline €4.7 bn Committed projects €1.4 bn Managed projects €3.3 bn MEDIUM-TERM PROJECTS BOULOGNE Molitor JEMMAPES 10th KELLER 15th RASPAIL 14th BOBILLOT 13th 4,500 m² 9,200 m² 3,500 m² 14,000 m² 3,700 m² SURFACE 54,000 m² SEE FOCUS TOTAL COST EXPECTED €0.6 RENTAL INCREASE 2020
Slide 42: Focus: Paris 10th Jemmapes redevelopment
Total France offices pipeline €4.7 bn Committed projects €1.4 bn Managed projects €3.3 bn FOCUS / PARIS 10th JEMMAPES, REDEVELOPMENT POTENTIAL IN AN EMERGING AREA Bassin de la Villette TODAY 9,200 m² PARIS JEMMAPES fully let to Orange until 2022 Parc des Buttes Chaumont Current rent Gare du Nord Col
Slide 43: Land banks
LAND BANKS
Slide 44: Land banks: 290,000 m² to be developed
Total France offices pipeline €4.7 bn Committed projects €1.4 bn Managed projects €3.3 bn LAND BANKS / 290,000 M² TO BE DEVELOPPED FOR €1.5 BN PARIS + GREATER PARIS SEE FOCUS PARIS LILLE 100,000 m² 22,000 m² SEE FOCUS VÉLIZY / MEUDON 80,000 m² BORDEAUX LYON 30,000 m² 55,000 m² CMD 2019 44
Slide 45: Focus: Velizy-Meudon business district
Total France offices pipeline €4.7 bn Committed projects €1.4 bn Managed projects €3.3 bn FOCUS / VELIZY-MEUDON, AN ATTRACTIVE BUSINESS DISTRICT FOR LARGE CORPORATES VÉLIZY-MEUDON BUSINESS DISTRICT: ~1 MILLION M² OF OFFICES ~ 80,000 m² TO DE DEVELOPPED DS Campus Extension 2 + Thalès extension + VIBE
Slide 46: Focus: Cap 18 construction potential in Paris
Total France offices pipeline €4.7 bn Committed projects €1.4 bn Managed projects €3.3 bn FOCUS / CAP 18, A LARGE CONSTRUCTION POTENTIAL IN PARIS Porte de TODAY Clignancourt Porte de la Chapelle CAP 18 Rosa Park 67,000 m² Campus BNP Paribas The Cargo business incubator of business premises Vill’Up s
Slide 47: Selective value-add acquisitions
SELECTIVE VALUE- ADD ACQUISITIONS
Slide 48: Value-add acquisitions: ~100,000 m² to be redeveloped
Total France offices pipeline €4.7 bn Committed projects €1.4 bn Managed projects €3.3 bn VALUE-ADD ACQUISITIONS / ~100,000 M² TO BE REDEVELOPPED FOR €0.6 BN SAINT-DENIS PLEYEL / 15,000 m² SAINT-DENIS PLEYEL SAINT-OUEN VICTOR HUGO So Pop (Ongoing) N2 (Ongoing) RUEIL LESSEPS SAINT-OUEN V. HUGO / 40,0
Slide 49: Focus: Rueil Vinci value-add acquisition
Total France offices pipeline €4.7 bn Committed projects €1.4 bn Managed projects €3.3 bn FOCUS / RUEIL VINCI, A VALUE-ADD ACQUISITION RUEIL VINCI BEFORE 300 m from RER A Noisy-Champs Line 15 Grand Paris Express (2023) AFTER ACQUISITION IN 2016 TOMORROW at 7.8% yield 38,600 m² Up to 44,000 m² (headq
Slide 50: Focus: Saint Ouen Victor Hugo
Total France offices pipeline €4.7 bn Committed projects €1.4 bn Managed projects €3.3 bn FOCUS / SAINT OUEN VICTOR HUGO, 14,000 M² BUILDING WITH ADJACENT LAND TODAY New Regional HQ of Ile-de-France region Les Docks 14,000 m² (New green urban development zone) of offices & light industrial VICTOR HU
Slide 51: Focus: Saint Denis Pleyel redevelopment
Total France offices pipeline €4.7 bn Committed projects €1.4 bn Managed projects €3.3 bn FOCUS / SAINT DENIS PLEYEL, REDEVELOPMENT ON THE METRO LINE 14 TODAY ST DENIS PLEYEL To Roissy 11,600 m² of multi-tenant offices Olympic Village 2024 Current rent Transport HUB St Denis Pleyel €130/m² New Regio
Slide 52: Key takeaways on France offices development pipeline
KEY TAKEAWAYS ON FRANCE OFFICES DEVELOPMENT PIPELINE
Slide 53: Sustainable pace of commitments & deliveries
FRANCES OFFICES / SUSTAINABLE PACE OF COMMITMENTS & DELIVERIES €1.4 BN €1.0 BN €1.0 BN €1.3 BN COMMITTED SHORT-TERM MEDIUM-TERM LONGER-TERM PROJECTS PROJECTS PROJECTS PROJECTS TODAY 2020-2021 2022-2023 2024 & BEYOND €4.7 BN ESTIMATED LAUNCH PIPELINE Mainly Mainly Land banks redevelopments redevelopm
Slide 54: Sustainable source of rental growth
FRANCE OFFICES / SUSTAINABLE SOURCE OF RENTAL GROWTH RENTAL INCOME IN THE YEAR AFTER DELIVERY FROM COMMITTED PIPELINE FROM MANAGED PIPELINE ~+€25 M ~+€24 M ~+€20 M ~€20 MILLION Group share 57% PER YEAR ~+€7 M Group share 32% ON AVERAGE Projects ~+€13 M already delivered in 2019 2020 2021 2022 2023 &
Slide 55: Covivio France Offices Strategy
III. COVIVIO FRANCE OFFICES STRATEGY III-A. DEVELOPMENT PIPELINE - SUCCESSFUL COMMITTED PROJECTS - POTENTIAL IN OUR PORTFOLIO III-B. CLIENT-ORIENTED STRATEGY - MORE SERVICES IN OUR PORTFOLIO - FLEX-WORKSPACE OFFER - DIGITALIZATION
Slide 56: Listening to market trends & customers' expectations
LISTENING TO MARKET TRENDS & OUR CUSTOMERS’ EXPECTATIONS Technological leap & New ways of working Generational needs New workspace use digital revolution Talent retention WHAT CONSEQUENCES FOR COVIVIO? Attractivity Creative Room, Collaborative Spaces, REVISED SERVICES OFFER IN OUR BUILDINGS Modern C
Slide 57: Measuring our customers' satisfaction
MEASURING OUR CUSTOMERS’ SATISFACTION SATISFACTION CLIENT SURVEY IN 2019 WITH 1,300 END-USERS INTERVIEWED IN 12 BUILDINGS ACTION 7.8 PLANS CO-DEFINED ACCESSIBILITY SERVICES 10 WITH SATISFACTION RATE OUR TENANTS SECURITY COMFORT CMD 2019 57
Slide 58: Focus on main expectations
FOCUS ON MAIN EXPECTATIONS 1 COMFORT 2 SERVICES 3 MOBILITY 4 DIGITALIZATION & GREEN CERTIFICATIONS CMD 2019 58
Slide 59: Green certifications
1 / GREEN CERTIFICATIONS “GREENING” RATE FRANCE OFFICES1 TARGET TARGET 100% OF GREEN -40% IN ENERGY OFFICES CONSUMPTION IN 2020 2008-2020 540 490 420 372 354 338 332 2008 2010 2012 2014 2016 2017 2018 Primary Energy (kWhpe/GLAsqm/year) ACHIEVEMENTS VS TARGET AT END-2018 -32% CMD 2019 1 Core portfoli
Slide 60: Enhanced green areas on developments
1 / ENHANCED GREEN AREAS ON ONGOING AND FUTURE DEVELOPMENT TARGET FOCUSING ON “BIODIVERCITY” LABEL… … AND OTHER APPROACHES 100% OF DEVELOPMENTS WITH GREEN AREAS MONTPELLIER POMPIGNANE PARIS CARRÉ SUFFREN VELIZY CAMPUS EIFFAGE Green areas LA DÉFENSE CB21 Rooftops Terraces PARIS JEAN GOUJON CHATILLON
Slide 61: Comfort certifications
1 / COMFORT CERTIFICATIONS AN EXPERIMENTAL APPROACH Feedback Define from our stakeholders Group policy PARIS JEAN GOUJON CHATILLON IRO PARIS ART&CO SO POP CMD 2019 61
Slide 62: Differentiated servicing approach inspired by hospitality
2 / DIFFERENTIATED SERVICING APPROACH INSPIRED BY OUR HOSPITALITY BUSINESS LINE TARGET ALL INCLUSIVE OFFER 100% OF OFFICES WITH COLLABORATIVE / SERVICES WELLNESS SPACES COMPONENT IN 2023 FOOD FACILITIES PHYSICAL CONCIERGE SERVICES DIGITAL CONCIERGE SERVICES THAÏS - LEVALLOIS DUGUESCLIN - LYON RIVERS
Slide 63: Paris Carre Suffren, revisiting the services offer
2 / PARIS CARRE SUFFREN, REVISITING THE SERVICES OFFER 25,000 M² BUILDING TOTAL INVESTMENT NEW €9.5 M CATERING BAR EXPERIENCE Ongoing 3,000 m² refurbishment RESHAPED of services areas ALTERNATIVE RENT WORKING INCREASE AREAS +10% CMD 2019 63
Slide 64: Lyon Silex 2, an all-inclusive offer
2 / LYON SILEX 2 / AN ALL-INCLUSIVE OFFER 31,000 M² OF PRIME OFFICES IN LYON PART-DIEU TO BE DELIVERED EARLY-2021 FLEXIBLE SPACES SERVICES TERRACES AND SKY-RESTAURANT GREEN AREAS & WELL-BEING CMD 2019 64
Slide 65: Ensuring high accessibility of our buildings
3 / ENSURING HIGH ACCESSIBILITY OF OUR BUILDINGS 61% >2 rail-transport access (subway, tramway, RER) CLOSE PROXIMITY LESS THAN 500 M TO PUBLIC TRANSPORT 38% 97.7% >1 rail-transport access ACCESSIBLE BETWEEN 500 M 2.3% 1% Bus only AND 1 KM CMD 2019 65
Slide 66: Covivio France Offices Strategy
III. COVIVIO FRANCE OFFICES STRATEGY III-A. DEVELOPMENT PIPELINE - SUCCESSFUL COMMITTED PROJECTS - POTENTIAL IN OUR PORTFOLIO III-B. CLIENT-ORIENTED STRATEGY - MORE SERVICES IN OUR PORTFOLIO - FLEX-WORKSPACE OFFER - DIGITALIZATION
Slide 67: A growing market with solid perspectives
A GROWING MARKET WITH SOLID PERSPECTIVES GROWING DEMAND SUPPORTS NEW OPENINGS… …WITH ROOM TO GROW 2.8 m ONLY ~1% OF TOTAL OFFICE STOCK 2.2 m in Paris, Milan & Berlin 1.8 m +50 % SPACE IN TWO YEARS 48% OF COMPANIES EXPECT TO USE SOME FLEX-WORKSPACE IN THE NEXT 3 YEARS END-2016 END-2017 END- 2018 VS 2
Slide 68: A key component of our offices strategy
A KEY COMPONENT OF OUR OFFICES STRATEGY STRATEGIC DRIVERS CONCRETE TOOLS OPERTIONAL RESULT NEUTRALIZE THE RISK DIRECT CONTACT Integrate users feedbacks OF OBSOLESENCE WITH END-USERS in the conception of our buildings The last brick in our services offer ABILITY TO BEST RESPOND IMPROVE OUR Offer a fu
Slide 69: Attractive positioning in European flexible landscape
AN ATTRACTIVE POSITIONING IN THE EUROPEAN FLEXIBLE LANDSCAPE CO-WORKING SERVICED OFFICES COMPLETE OFFERS OFFERS (business center) (co-working & private offices) 21% 45% 34% OF THE SURFACE OF THE SURFACE OF THE SURFACE The most dynamic segment >50% of the growth of Europe flexible space since 2016 CM
Slide 70: Covivio flexible workspace: 12,000 m² opened
COVIVIO FLEXIBLE WORKSPACE / 12,000 M² OPENED AT 4 SITES EUROMED MARSEILLE GARE DE LYON – PARIS 12th OPENING OPENING of the 1st of the 2nd site 2,300 m² in Paris 5,000 m² End-2017 March 2018 Sept. 2018 Oct. 2018 MIROMESNIL – PARIS 8th MONTMARTRE – PARIS 18th OPENING of the 1st site 1,400 m² located
Slide 71: A full range of real estate solutions
A COMPLEMENTARY OFFER / A FULL RANGE OF REAL ESTATE SOLUTIONS TRADITIONAL MIXED-BUILDINGS WITH TRADITIONAL BUILDINGS DEDICATED LEASE LEASE & FLEXIBLE WORKSPACE TO FLEXIBLE WORKSPACE CALYPSO ART&CO WELLIO MIROMESNIL EUROMED MARSEILLE PARIS GARE DE LYON PARIS 8th Wide range of layouts & locations Larg
Slide 72: Art&Co in Gare de Lyon mixed-use building
EXAMPLE OF A MIXED-USE BUILDING / ART&CO IN GARE DE LYON 13,000 m² 8,000 m² (~60%) Traditional leases Flexible workspace 5,000 m² (~40%) (720 workstations) ROOFTOP EVENTS PROJECT & INNOVATION ROOMS SPACE TRADITIONAL LEASE OFFICE OFFICE RECEPTION DESK / BAR LOUNGE BAR / WORK MEETINGS CAFE CO-WORKING
Slide 73: Expanding our client base
A COMPLEMENTARY OFFER / EXPANDING OUR CLIENT BASE 70% NEW COMPANIES to support in their real estate strategy, for OF OUR FLEXIBLE CLIENTS more business ARE LARGE CORPORATES opportunities WE SUPPORT Traditional lease partners becoming OUR PARTNERS flex-workspace IN THEIR TRANSFORMATION clients CMD 20
Slide 74: Building in partnership with Orange, Montmartre
EXAMPLE OF A BUILDING IN PARTNERSHIP WITH ORANGE / MONTMARTRE IN PARIS 18th 5,900 m² Lease extension 4,500 m² (76%) with Orange in 2018 +12 years firm Flex-workspace offer 1,400 m² (24%) 100% occupied incl. 50% secured by Orange ► Secure Orange presence WIN-WIN ► Offer flexibility and innovative w
Slide 75: Benefits of an integrated model
A COMPLEMENTARY OFFER / THE BENEFITS OF AN INTEGRATED MODEL IN THE DEVELOPMENT PHASE IN THE OPERATING PHASE Rely on our in-house development team Rely on our in-house property management team FLEXIBLE WORKSPACE IS TAKEN INTO ACCOUNT AT DESIGN PHASE CMD 2019 75
Slide 76: A successful concept (1/2)
A SUCCESSFUL CONCEPT (1/2) 96% OCCUPANCY ON AVERAGE1 PARIS MIROMESNIL PARIS MONTMARTRE 3,500 m² 96% occupancy 1,400 m² 100% occupancy 4 PARIS GARE DE LYON MARSEILLE EUROMED >12 MONTHS SITES OPEN 5,000 m² 95% occupancy 2,300 m² 97% occupancy AVERAGE IN FRANCE CONTRACT LENGHT INCREASING PRICES
Slide 77: A successful concept (2/2)
A SUCCESSFUL CONCEPT (2/2) ON OPERATING SITES ~€15 million Revenue IN 2020 ~€8.5 million EBIT EXCLUDING HOLDING COSTS +25-30% AVERAGE PROFITABILITY EBIT vs RENT CMD 2019 77
Slide 78: Next openings: 22,500 m² by 2022
NEXT OPENINGS / 22,500 M² IN FRANCE & IN MILAN BY 2022 BORDEAUX MILAN PARIS 5th IN 2019 CITÉ DU NUMÉRIQUE VIA DANTE GOBELINS 4,700 m² 4,300 m² & 2020 3,000 m² PARIS 8th IN 2021 LYON SILEX 2 5,500 m² JEAN GOUJON & 2022 5,000 m² CMD 2019 78
Slide 79: Covivio France Offices Strategy
III. COVIVIO FRANCE OFFICES STRATEGY III-A. DEVELOPMENT PIPELINE - SUCCESSFUL COMMITTED PROJECTS - POTENTIAL IN OUR PORTFOLIO III-B. CLIENT-ORIENTED STRATEGY - MORE SERVICES IN OUR PORTFOLIO - FLEX-WORKSPACE OFFER - DIGITALIZATION
Slide 80: Digital transformation, a key response to new trends
DIGITAL TRANSFORMATION, A KEY RESPONSE TO NEW REAL ESTATE TRENDS 90% of our time is spent in a building. NEW WAYS OF LIVING Users require greater flexibility and new services ENERGY CHALLENGES Buildings represent ~25% of CO2 emissions in Europe ECONOMIC CHALLENGES Real estate and energy prices are r
Slide 81: IT & digital roadmap: 3 main pillars
COVIVIO IT & DIGITAL ROADMAP / 3 MAIN PILLARS FOR THE NEXT 3 YEARS 1 2 3 BUILDING DATA DRIVEN EUROPE AS A SERVICE ACTIONS & CHANGE TO DELIVER TO ANTICIPATE TO IMPROVE the best offer to our clients and develop knowledge efficiency and work differently JOINTLY DEVELOPED WITH OUR EUROPEAN TEAMS (BUSINE
Slide 82: Building as a service: partnership with Monbuilding
1 - BUILDING AS A SERVICE / PARTNERSHIP WITH MONBUILDING FOR OFFICES CLIENTS DESIGN OUR OFFICE CLIENTS’ DIGITAL JOURNEY AN APP & WEB PLATFORM FOR OUR OFFICES CLIENTS (Flex and traditional) ► COMMUNITY & COMMUNICATION ► SMART BOOKING / Meeting rooms, co-working space, with direct payment ► CONCIERGE
Slide 83: Building as a service: partnership with Facilioo
1 - BUILDING AS A SERVICE / A PARTNERSHIP WITH GERMAN START-UP FACILIOO FOR RESIDENTIAL CLIENTS COVIVIO#HOME, 3 MAIN OBJECTIVES An app for our residential clients… CLIENT SERVICE / Focus less on day-to-day, more on clients’ expectations COMMUNICATION / Direct link FASTER RESPONSE TIME with Covivio T
Slide 84: Data-oriented strategy to serve clients (1/2)
2 - A STRONG DRIVE TO ADOPT A DATA-ORIENTED STRATEGY TO SERVE OUR CLIENTS BETTER AND FASTER (1/2) 1ST INITIATIVES MEASURE ENERGY CONSUMPTIONS AND ACCESS TO A DATA PORTAL IN REAL TIME 22 BUILDINGS PILOT AND ANTICIPATE ENERGY EQUIPPED CONSUMPTION OF COVIVIO’S WITH SENSORS TO IMPROVE BUILDINGS FOR EFFI
Slide 85: Data-driven strategy to serve clients (2/2)
2 - A STRONG DRIVE TO ADOPT A DATA DRIVEN STRATEGY TO SERVE OUR CLIENTS BETTER AND FASTER (2/2) 1ST INITIATIVES FIRST TRIAL TO MEASURE ACTUAL KNOW OUR CLIENTS BETTER EFFICIENCY ON ONE WELLIO SITE WITH A CRM SOLUTION ► DATA PORTAL TO ACCESS AND MONITOR ► FOLLOW CLIENTS AT THE EUROPEAN LEVEL ROOM OCCU
Slide 86: Europe & change: actions on change and culture
3 - EUROPE & CHANGE / CONCRETE ACTIONS ON CHANGE AND CULTURE FOR INNOVATION 1,001 IDEAS Launch of a JOINT INNOVATION PLATFORM in 2018 for Covivio employees to PROMOTE NEW IDEAS and empower our teams to be stakeholders in our transformation ► 4 THEMES: Europe, client service, quality at work and What
Slide 87: Key takeaways
KEY TAKEAWAYS
Slide 88: Key takeaways
KEY TAKEAWAYS Focus on France Offices 1 Growth potential Through our development pipeline 2 Value creation potential >35% target value creation 3 Capacity to fuel this pipeline Mainly in Paris Full services offer to deploy on our portfolio 4 Client-oriented approach Digital transformation CMD 2019 8
Slide 89: Asset tour
ASSET TOUR COVIVIO — cmp 2019
Slide 90: Asset tour
ASSET TOUR Wellio Paris Miromesnil – Flexible workspace 1 11 avenue Delcassé, Paris 8 Paris Percier – Multi-let 2 9 avenue Percier, Paris 8 6 Orange Paris Anjou 7 3 5 11/15 rue d’Anjou, Paris 8 8 9 4 Orange Paris Carnot 4 2 3 23 rue Mederic, Paris 17 1 Paris Streambuilding – Development project 5 ZA
Slide 91: Wellio Miromesnil flex-workspace building (1/2)
WELLIO MIROMESNIL / REFURBISHED INTO A FLEX-WORKSPACE BUILDING (1/2) 11 AVENUE DELCLASSE, PARIS 8 SURFACE AREA 4,800 m² 7TH Event space INCL. 3,500 m² FLEX-SPACE 320 DESKS OCCUPANCY RATE Intermediate floors (Meeting rooms and flexible offices) 96% ON FLEXIBLE OFFICE PRICE PER DESK €1,100/month ON FL
Slide 92: Wellio Miromesnil flex-workspace building (2/2)
WELLIO MIROMESNIL / REFURBISHED INTO A FLEX-WORKSPACE BUILDING (2/2) 11 AVENUE DELCLASSE, PARIS 8 2009 / ACQUISITION AT A 7.6% YIELD Arc de Triomphe 2017 / DEPARTURE OF THE PREVIOUS TENANTS AND REFURBISHMENT Grand Palais WELLIO Miromesnil MAR. 2018 / OPENING OF WELLIO Percier Madeleine Parc END-OCT.
Slide 93: Percier trophy asset in the heart of the CBD (1/2)
PERCIER / TROPHEE ASSET IN THE HEART OF THE CBD (1/2) 9 AVENUE PERCIER, PARIS 8 Arc de Triomphe SURFACE AREA Grand Palais 8,600 m² WELLIO Madeleine Miromesnil Percier OCCUPANCY RATE 98% CURRENT RENT ON OFFICES Parc Monceau €585/m² Saint Lazard Train Station FIRM LEASE TERM 2 YEARS CMD 2019 93
Slide 94: Percier trophy asset in the heart of the CBD (2/2)
PERCIER / TROPHEE ASSET IN THE HEART OF THE CBD (2/2) 9 AVENUE PERCIER, PARIS 8 2009 / ACQUISITION AT A 6.3% YIELD 2015 / LEASE WITH CHLOÉ GROUP 6,000 M² AT €570/M² 2018 / ADDITIONAL LEASE WITH CHLOÉ 1,400 M² AT €640/M² >10% RENT INCREASE POTENTIAL MAIN TENANT CHLOÉ GROUP (90%) CMD 2019 94
Slide 95: Orange Anjou redevelopment potential (1/2)
ORANGE ANJOU / REDEVELOPMENT POTENTIAL IN THE CBD (1/2) 11/15 RUE D’ANJOU PARIS 8 Saint Lazard Train Station SURFACE AREA Saint-Augustin 10,100 m² Madeleine RENT ON OFFICES Orange Anjou OCCUPANCY RATE €560 /m² The Elysée palace 100% ORANGE (93%) & LA POSTE (7%) FIRM LEASE TERM Grand Palais 2 YEARS C
Slide 96: Orange Anjou redevelopment potential (2/2)
ORANGE ANJOU / REDEVELOPMENT POTENTIAL IN THE CBD (1/2) 11/15 RUE D’ANJOU PARIS 8 2006 / SALE & LEASEBACK WITH ORANGE AT 6.2% YIELD 2021 / END OF LEASE OF ORANGE AND LA POSTE EXTRACTING RENT INCREASE & VALUE CREATION THROUGH REDEVELOPMENT €900/m² CURRENT PRIME RENT IN THE AREA 3% CURRENT PRIME YIELD
Slide 97: Orange Carnot redevelopment potential (1/2)
ORANGE CARNOT / REDEVELOPMENT POTENTIAL IN THE CBD (1/2) 23 RUE MÉDÉRIC, PARIS 17 Arc de Triomphe SURFACE AREA 11,200 m² Parc Monceau RENT ON OFFICES Orange Carnot OCCUPANCY RATE €590 /m² 100% BY ORANGE Wagram Avenue FIRM LEASE TERM 2 YEARS CMD 2019 97
Slide 98: Orange Carnot redevelopment potential (2/2)
ORANGE CARNOT / REDEVELOPMENT POTENTIAL IN THE CBD (2/2) 23 RUE MÉDÉRIC, PARIS 17 2006 / SALE & LEASEBACK WITH ORANGE AT 6.6% YIELD 2021 / END OF LEASE OF ORANGE EXTRACTING RENT INCREASE & VALUE CREATION THROUGH REDEVELOPMENT €750/m² CURRENT PRIME RENT IN THE AREA 3% CURRENT PRIME YIELD CMD 2019 98
Slide 99: Paris Streambuilding mixed-use project (1/2)
PARIS STREAMBUILDING / AN INNOVATIVE MIXED-USE PROJECT (1/2) ZAC CLICHY BATIGNOLLES, PARIS 17 ONE OF THE LARGEST URBAN REGENERATION AREA OF PARIS THE BATIGNOLLES AREA WITH AN OBJECTIVE OF NEUTRAL CARBON BALANCE Project STREAMBUILDING A mix of offices, retail and high-end residential Residential | 23
Slide 100: Paris Streambuilding mixed-use project (2/2)
PARIS STREAMBUILDING / AN INNOVATIVE MIXED-USE PROJECT (2/2) ZAC CLICHY BATIGNOLLES, PARIS 17 WINNER OF THE “REINVENTER PARIS” COMPETITION FOR URBAN INNOVATIVE PROJECTS SURFACE AREA 15,900 m² Rooftop agriculture TOTAL COST €162 m Hotel (4,600 m²) SHARED AT 50% Offices (4,800 m²) & Flex-offices (4,50
Slide 101: Paris So Pop redevelopment-extension (1/2)
PARIS SO POP / REDEVELOPMENT-EXTENSION BETWEEN PARIS & ST-OUEN (1/2) 6 RUE FRUCTIDOR, PARIS 17TH New Paris courthouse SURFACE AREA 31,000 m² SO POP TOTAL COST €226 m SHARED AT 50%1 TARGET RENT €420 /m² YIELD ON COST CMD 2019 101 6.1% AMBITIOUS GREEN CERTIFICATIONS CMD 2019 101
Slide 102: Paris So Pop redevelopment-extension (2/2)
PARIS SO POP / REDEVELOPMENT-EXTENSION BETWEEN PARIS & ST-OUEN (1/2) 6 RUE FRUCTIDOR, PARIS 17TH 2012 / ACQUISITION OF CITROËN HEADQUARTERS AT 8.1% YIELD 2018 / DEPARTURE OF CITROËN 2019 / BUILDING PERMIT WITH A 70% EXTENSION FROM 18,500 m² TO 31,000 m² 2019 / SYNDICATION OF 49.9% WITH CREDIT AGRICO
Slide 103: Levallois Alis three buildings (1/2)
LEVALLOIS ALIS / THREE BUILDINGS FOR A PRIME REDEVELOPMENT (1/2) 35 RUE BAUDIN, LEVALLOIS-PERRET SURFACE AREA 20,500 m² Thais Delivered in 2016 TOTAL COST €215 m SHARED AT 50% TARGET RENT €530 /m² ON OFFICES YIELD ON COST 103 5.0% CMD 2019 103
Slide 104: Levallois Alis three buildings (2/2)
LEVALLOIS ALIS / THREE BUILDINGS FOR A PRIME REDEVELOPMENT (2/2) 35 RUE BAUDIN, LEVALLOIS-PERRET 2000 / ACQUISITION OF THE FIRST TWO BLOCKS OF 13,000 m² 2015 / ACQUISITION OF THE THIRD BLOCK OF 4,700 m² AT 6.4% YIELD JAN. 2019 / DEPARTURE OF LAGARDÈRE 2019 / BUILDING PERMIT WITH A 15% EXTENSION TO 2
Slide 105: Thais redevelopment of former Orange building (1/2)
THAIS / REDEVELOPMENT OF A FORMER ORANGE BUILDING (1/2) 29 RUE ANATOLE FRANCE, LEVALLOIS-PERRET Eiffel Tower Grand Palais Arc de Triomphe SURFACE AREA 5,600 m² Porte Maillot RENT ON OFFICES OCCUPANCY RATE €490 /m² 100% THAIS Louise Michel FIRM LEASE TERM 4 YEARS CMD 2019 105
Slide 106: Thais redevelopment of former Orange building (2/2)
THAIS / REDEVELOPMENT OF A FORMER ORANGE BUILDING (2/2) 29 RUE ANATOLE FRANCE, LEVALLOIS-PERRET 2003 / ACQUISITION OF THE BUILDING 2014 / DEPARTURE OF ORANGE 2015-2016 / DEMOLITION & RECONSTRUCTION Q2 2017 / DELIVERY CMD 2019 81% VALUE CREATION REALISED 106
Slide 107: Maillot attractive location at Porte Maillot
MAILLOT / ATTRACTIVE LOCATION AT THE NEW PORTE MAILLOT 18 RUE GUSTAVE CHARPENTIER, PARIS 17 Arc de Triomphe La Grande Armée avenue SURFACE AREA 9,800 m² Palais des congrès RENT ON OFFICES OCCUPANCY RATE €480 /m² Extension of the Parodi square Orange Maillot 100% New access road linking the two avenu
Slide 108: Appendix
APPENDIX COVIVIO — cmp 2019
Slide 109: Covivio committed pipeline
COVIVIO COMMITTED PIPELINE Total Total Surface 1 Pre-let Capex to be invested Synthesis of Committed projects Budget 2 Budget 2 Target Yield 3 (m²) (%) (€M, Group share) (€M, 100%) (€M, Group share) France Offices 210,720 m² 46% 1,412 1,103 5.8% 531 Italy Offices 94,500 m² 68% 424 424 6.4% 164 Germa
Slide 110: France offices committed pipeline
FRANCE OFFICES COMMITTED PIPELINE Total Capex to be Total Surface¹ Target rent Pre-let Budget ² invested Committed projects Location Project Delivery Budget² Target Yield³ (m²) (€/m²/year) (%) (€M, Group (€M, Group (€M, 100%) share) share) Meudon Ducasse Greater Paris Construction 5,100 m² 2020 260
Slide 111: France offices managed pipeline
FRANCE OFFICES MANAGED PIPELINE Surface Total Cost Total Cost Projects Location Type 100% 100% Group share m² €M €M Total ~550 000 m² ~€3.3 bn ~€3.2 bn Provence Paris Redevelopment ~7 500 m² Anjou Paris Redevelopment ~10 100 m² Jemmapes Paris Redevelopment ~11 700 m² Carnot Paris Redevelopment ~11 2
Slide 112: Contact
CONTACT Paul Arkwright Hugo Soussan Tel.: +33 1 58 97 51 85 Tel.: +33 1 58 97 51 54 Mobile: +33 6 77 33 93 58 Mobile: +33 6 84 44 95 40 paul.arkwright@covivio.fr hugo.soussan@covivio.fr Paris 30, avenue Kléber 75116 Paris Tel.: +33 1 58 97 50 00 www.covivio.eu