Helios Re Socimi, S.a. · BME:SCHLR
Helios Re Socimi — Lar España Real Estate SOCIMI — Investor Day (October 2016)
88 slides from Helios Re Socimi's investor day presentation, October 2016
Slide 1: Investor Day
www.larespana.com Investor Day October 2016
Slide 2: Investor Day - Jose Luis del Valle
Investor Day www.larespana.com Jose Luis del Valle Chairman Lar España October 2016
Slide 3: Disclaimer
3 Disclaimer This document has been prepared by Lar España Real Estate SOCIMI, S.A. (the “Company”) for information purposes only and it is not a regulated information or information which has been subject to prior registration or control by the Spanish Securities Market Commission. This document ne
Slide 4: Welcome Lar España Investor Day
Welcome Lar España Investor Day Marcelo Spínola Office Building, Madrid
Slide 5: Presenting team
5 Presenting team José Luis del Valle Alec Emmott Luis Pereda Miguel Pereda Chairman Lar España Lar España Director Chairman Grupo Lar CEO Grupo Lar Lar España Director Jose Manuel Llovet Jorge Perez de Leza Sergio Criado Hernán San Pedro Grupo Lar Head of Retail Grupo Head of Non Retail Lar España
Slide 6: Why an Investor Day?
6 Why an Investor Day? Present Communication Time to Update Announcements Intense investor After >2 years operating Management fee communication policy as a SOCIMI, we want to Capital and dividend Recurrent roadshows share with you the policy and investor meetings performance and strategic o
Slide 7: Today's Agenda
7 Today’s Agenda Corporate Governance/ CSR: Corporate Stands Alec Emmott, Lar España Director The Value of Management: 360 Digital Luis Pereda, Chairman Grupo Lar Marcelo Spínola Asset Tour Transformation Corporate Stands Investment Retail Strategy: Jose M. Llovet, Grupo Lar Head of Retail Developme
Slide 8: Major milestones since 2014
8 Major milestones since 2014 22. SC El Rosal 23. RU Galaria 28. RP Vistahermosa 24. RC VidaNova Development 4. OF Marcelo Spinola 25. RC Megapark 5. SC Albacenter 6. SC Anecblau 15. RE Lagasca99 7. LW Alovera 1. SC Txingudi 8. RU Villaverde 2. SC Las Huertas IPO March 14 3M14 6M14 9M14 12M14 3M15 6
Slide 9: Investor Geographical Breakdown
9 Investor Geographical Breakdown USA 24.8% SPAIN 34.1% UK 33.3% OTHER 7.8% …with the support of investors worldwide
Slide 10: Liquidity
10 Liquidity € Mn 3,335 2,326 954 565 1,295 839 1,008 259 0.72% 0.34% 0.33% 0.32% 0.28% 0.25% 0.22% 0.03% Spanish Spanish Irish Spanish Spanish Irish Italian Peer 1 Peer 2 Peer 1 Peer 3 Peer 4 Peer 2 Peer 1 Market cap L3M average daily traded value as a % of Market cap Average liquidity in line with
Slide 11: Lar España Strategy
11 Lar España Strategy Special focus on under managed First IPO of a Spanish REIT assets listed on the Spanish Stock Exchanges Real estate Manager with objective of MANAGEMENT implementing an Active Management Strategy in order to deliver “Alpha” >100 Real Estate Company’s business strategy is to ac
Slide 12: Assets Strategy I
12 Assets Strategy I 1 Focus on shopping centres and retail parks Key assets in their catchment areas Locations Locations selected based on: Prime assets in their area of influence Level of competition Close to 500,000 sqm GLA Current GDP per capita and future growth outlook Impact of tour
Slide 13: Assets Strategy II
13 Assets Strategy II 2 Opportunistic approach to other assets Core locations Focus on value added assets Luxury residential for sale Management as a key element to make acquisitions and Offices in Madrid and Barcelona generate differential value, taking advantage of Grupo Lar’s Logistics in m
Slide 14: Right timing, right resources, right platform
14 Going forward 1 RIGHT TIMING Cycle 2 RIGHT RESOURCES Operational Opportunity Financial Know-How 3 RIGHT PLATFORM Size RESULTS Synergies Operation Developments Revaluation Rotation potential Dividends
Slide 15: Closing Remarks
15 Closing Remarks Track Record Tools to Grow Brilliant Future After >2 years operating Lar España is set to grow Lar España aspires to as a SOCIMI, Lar España through: become the reference has built an outstanding Portfolio size increase with value-added REIT in retail platform and its current fi
Slide 16: Investor Day
Investor Day Follow us: www.larespana.com Lar España Real Estate SOCIMI info@larespana.com Investor Day App
Slide 17: Corporate Governance and Social Responsibility
Corporate Governance and Social Responsibility Investor Day www.larespana.com Alec Emmott Board Member Lar España October 2016
Slide 18: Corporate Governance as a priority
18 Corporate Governance as a priority Lar España has prioritized best-in-class corporate governance Pledge to guarantee that the Company’s governance structures are adequately integrated and functioning as intended Objectives of the Action Plan 2014-2016 Ensuring strong governance Transparency in ma
Slide 19: Governance Structure
19 Governance Structure Independent and experienced Board: 4 Critical Activities internalized independent directors (4 out of 5) José Luis del Valle Roger Cooke Pedro Luis Uriarte Sergio Criado Jon Armentia Susana Guerrero Chairman and Independent Independent CFO Corporate Legal Independent Director
Slide 20: Alignment of interests
20 Alignment of interests Commitment & Exclusivity: Alignment of interests with the manager Grupo Lar is contracted to Grupo Lar now owns a 3.5% Initial 5-year management provide Management services stake in Lar España, subject to contract (since March 2014) exclusively to LRE a lock-up period
Slide 21: Corporate Governance Targets
21 Corporate Governance Targets 6 Create and distribute value in a sustainable manner: 6 protecting investor’s rights, and providing a fair Investors treatment of all stakeholders. and Shareholders Ensure reliability and traceability of financial 5 information. 5 Financial Information Management and
Slide 22: Corporate Governance Initiatives
22 Corporate Governance Initiatives Risk Control and Code of Conduct and Internal Audit Management System Whistle-blowing Policy approved in February Approved by the Board of Lar España has an internal 2015 Directors in 2015 to audit department to monitor complement the CNMV the proper functio
Slide 23: Corporate Social Responsibility
23 Corporate Social Responsibility i. Promote communication and value creation for long-term shareholders. ii. Cooperate with institutions, non-governmental organizations, and private companies, Economic to promote community welfare in the medium and long term. iii. Promote training and performance
Slide 24: Investor Day
Investor Day Follow us: www.larespana.com Lar España Real Estate SOCIMI info@larespana.com Investor Day App
Slide 25: The Value of the Management
The Value of the Management Investor Day www.larespana.com Luis Pereda Chairman Grupo Lar October 2016
Slide 26: Commitment and exclusivity
26 Commitment and exclusivity Manager Contract Summary 1 Grupo Lar is contracted to exclusively provide Management services to LRE. Initial five-year contract 2 The Manager is committed to exclusivity for commercial property investment opportunities in Spain In the Residential sector in Spain, Lar E
Slide 27: Grupo Lar Snapshot
27 Grupo Lar Snapshot A Real Estate Reference in Spain 1 Stable Ownership & Governance Family owned Company with more than 40-year of track record 2 Strong Management Team +270 employees in 7 Countries 3 Geographical Diversification Long history of Real Estate of Residential, Shopping Centres and 4
Slide 28: Grupo Lar evolution and key milestones
28 Grupo Lar evolution and key milestones 1 2 3 4 c. 40 year track record of Experience across varied Partnerships with key Phased expansion into operations asset classes international institutional international markets investors Opening of Peru JV with Fortress JV with Baupost Morgan Stanl
Slide 29: Board of Directors
29 Board of Directors Total of 10 Directors Mr. Felipe Pereda Mr. Luis Pereda Mr. Miguel Pereda Mr. Jaime Pereda Mr. Miguel Amo Executive Chairman Secretary Mr. Félix González Quesada Mr. Antonio Rodriguez Pina 4 Independent Vice President Qualcomm Spain and Deutsche Bank’s Country Head in Spain Dir
Slide 30: Experience in all asset classes
30 Experience in all asset classes Long track record of experience investing, developing and managing shopping centres, offices, logistics and residential buildings Retail Offices Logistics Residential 39 shopping centres invested, 9 office buildings 10 Industrial 10,000 residential developed or man
Slide 31: Successful international experience
31 Successful international experience Joint Ventures with Tier 1 Investors and long term relationships with Financial Institutions Retail co-investments Whitehall MSREF
Slide 32: Leaders in retail management - Gentalia
32 Leaders in retail management - Gentalia
Slide 33: Leaders in retail management - Gentalia
33 Leaders in retail management - Grupo Lar holds a stake of 66,66% in the shopping centre management company “Gentalia” Gentalia in Numbers Leasing Activity 2007-H1 2016 Period 52 4 679,289 3,145 Shopping Centres New Shopping sqm GLA of signed Number of signed under leasing and Centre Project contr
Slide 34: Grupo Lar's track record - Awards
34 Grupo Lar’s track record - Awards PANORAMA SARRIÁ FORUM “Architecture, Urbanism and Public Most innovative building” Real Estate Service Award 2007” in the category of Quatrium Awards, granted by Grupo Vía New Residential Developments granted (2003). by the Town Hall of Madrid. PANORAMA P
Slide 35: Lar España
Lar España Megapark Retail Complex, Bilbao
Slide 36: What have we achieved?
36 What have we achieved? Retail platform + non-retail assets MALL Offices Logistics Residential Retail Offices in consolidated Focus on logistic Development of first homes locations of Madrid and properties on a selective in niche markets without Top retail player Barcelona with good basis with low
Slide 37: Company Snapshot
37 Company Snapshot EPRA Net Initial Yield: 5.8% GAV (€ Mn) Development s 6,2% Logistics Residential 5% 5% Retail 6% Rental Properties Offices 13% 95% 4.4%3 Offices €1,1911 €1,1911 Retail Develop. 7,2% 5% Retail Logistics 71% EPRA Occupancy Rate: 93.0% Annualized Net Rental Income (€ Mn) Logistics 9
Slide 38: New base fee scheme
38 New base fee scheme Base fee New base fee scheme applicable since today1 1.25% on EPRA NAV up to €600 Mn 1.25% on last EPRA NAV Base fee reported reduction 1% on the excess on EPRA NAV > €600 Mn Portfolio evolution since IPO € Mn NAV: GAV2: €610.6Mn €1,191Mn 1000 800 600 400 200 0 Q12014 Q2
Slide 39: Portfolio distribution
39 Portfolio distribution Location by asset class 6 10 13 4 15 RETAIL 9 7 12 5 76% GAV 5 OFFICES 21 22 20 23 1 24 13% GAV 17 16 26 19 18 11 5 LOGISTICS 6% GAV 14 25 3 1 RESIDENTIAL 2 8 5% GAV 15
Slide 40: Expertise and management tools
40 Expertise and management tools… Shareholder 1 2 3 4 5 Return Fundraising Acquisition Development, Active Divestments Repositioning property & turnaround Management activities . …showcased in upcoming Corporate Stands Retail Retail 360º Digital Transformation Lagasca 99 Investment Development
Slide 41: Investor Day
Investor Day Follow us: www.larespana.com Lar España Real Estate SOCIMI info@larespana.com Investor Day App
Slide 42: Retail Strategy: A value creation story
Retail Strategy A value creation story Investor Day www.larespana.com Jose Manuel Llovet Grupo Lar Head of Retail October 2016
Slide 43: Leading shopping centres in strong catchment areas
LEADING SHOPPING CENTRES IN STRONG CATCHMENT AREAS
Slide 44: Leading shopping centres in strong catchment areas
LEADING SHOPPING CENTRES IN STRONG CATCHMENT AREAS The forefront of our strategy is to create shopping destinations for consumers and retailers, increasing shareholders value and deliver strong long-term returns
Slide 45: Did you know that…
Did you know that… Vistahermosa Retail Park, Alicante
Slide 46: Year-on-year consumption rates positive for 29 months
46 Year-on-year Consumption Rates have been positive for the last 29 months… Notes: 1. Year-on-year consumption variation compared to the same period in previous year, starting to count only positive variations from November 2013 till July 2016.
Slide 47: Previously we had 72 months in negative
47 Previously we had 72 months in negative? Notes: 1. Year-on-year consumption variation compared to the same period in previous year, starting to count only negative variations from March 2008 till October 2013. 2. *3 months in 2010 had a minimum increase.
Slide 48: Consumption index still 12% below 2007 level
48 Consumption Index at July 2016 is still 12% below 2007’s level (room for growth)? Notes: Comparing accumulated consumption figures Jan-Jul 2007 and Jan-Jul 2016.
Slide 49: Market yields of target shopping centres
49 Market yields of our target SC in the peak were 5.25% and now are 6% whilst Offices and High- Street are already the same?
Slide 50: Lar España is the most active buyer in retail
50 Lar España is the first MOST ACTIVE BUYER (second including corporate deals) in Retail since Jan 2014?
Slide 51: Biggest portfolio of dominant value add centres
51 Lar España has the biggest Portfolio of Dominant Value Add Centres in Spain?
Slide 52: Capital value per m² below replacement cost
52 Lar España capital value per m² of €2,244 is 15% below its Replacement Cost and 22% below other Socimis SC’s, having better quality and more balanced portfolio?
Slide 53: Top 10 tenants represent 40% of total income
53 Our top 10 Tenants represent 40% of total income and their sales increased by +8% YTD?
Slide 54: WAULT is 3
54 WAULT is 3… in theory we can rotate all of our tenants in 3 years?
Slide 55: Turnover rents and specialty leasing
55 Turnover Rents are 4% of Total Gross Income and Specialty Leasing is 2.7%?
Slide 56: Asset Selection
Asset Selection Megapark Retail Complex, Bilbao
Slide 57: Lar España has a clear objective
57 LAR España has a clear objective Consolidate among the top 3 retail operators in Spain: Target to selectively increasing GLA to generate revenue synergies Top 10 players own 167 shopping centres which represent c.25% Spain Total Retail GLA by Size of the total Spanish market Total Assets GLA per
Slide 58: Well defined investment strategy
58 Well defined investment strategy Asset Type Shopping centres and retail parks Asset Prime dominant assets in their catchment areas Quality and Large properties for their catchment (30,000 – 100,000 sqm) Location Located in high density population areas, with Segment Value added: Creating shopping
Slide 59: Vision
59 Vision Invest in higher-growth assets Dominant in its area Portfolio Selection Resilient centres. Recovery capture Develop higher-return assets (2-digit IRRs) Upgrade retail quality Sales Increase / Occupancy increase Operational Execution Re-letting at higher market rents. Reversio
Slide 60: Vision
60 Vision Invest in higher-growth assets Dominant in its area Portfolio Selection Resilient centres. Recovery capture Develop higher-return assets (2-digit IRRs) Upgrade retail quality Sales Increase / Occupancy increase Operational Execution Re-letting at higher market rents. Reversio
Slide 61: Our Portfolio
Our Portfolio Portal de la Marina Shopping Centre, Alicante
Slide 62: Our Portfolio
62 Our Portfolio Geographically diversified… As Termas El Alisal Megapark Txingudi …and in the wealthiest Galaria regions Gran Vía El Rosal Las Huertas AnecBlau Villaverde Sagunto DEV Albacenter Direct catchment Portal de la Marina Palmas Altas DEV area of 6 Mn inh. Vistahermosa 15% of Total Spanish
Slide 63: Portfolio Key Metrics
63 Portfolio Key Metrics GLA 2 assets TDC Number of units €222 Mn under 350,000 sqm Operating 850 + 250 (Dev) development 120,000 sqm Development NMV €847 Mn (June 2016) (Operating Centres) Occupancy Footfall Sales growth (June 16) c. 50 Mn +5% (Sep15-Aug16) 93% vs National index 3% (June 16) Notes:
Slide 64: Portfolio of high quality assets & growth
64 Portfolio of high quality assets & growth Megapark Palmas Altas P. Marina El Rosal Anecblau As Termas Gran Vía Vigo Vistahermosa LAR España largest assets represent 90% of its retail GAV Dominant in its catchment area % of High Quality Tenants 1 98% n.a. 95% 89% 98%
Slide 65: Ongoing Development Projects
65 Ongoing Development Projects Asset Strategic Positioning Asset Strategic Positioning • Best possible location in Seville → urban site • Best possible location in Sagunto → urban site • Catchment area: 1.5 Mn people • Touristic destination: triple population in Summer • Low commercial offer in the
Slide 66: The value of a retail platform
66 The value of a retail platform 350,000 sqm, 850 shops, 50,000,000 visitors, 13 cities Retail Leaders in Spain Critical Portfolio Size gives us benefits in: Synergies in procurement of services Mass Global Negotiations with tenants Experience Nation Present in most regions of the & New Leaders wid
Slide 67: Value Creation
Value Creation As Termas Shopping Centre, Lugo
Slide 68: Value Creation. Our 4 Pillars
68 Value Creation. Our 4 Pillars 1 2 EXPERIENCE Best Retailers Transform prime under-managed SC City meeting point vs REPOSITIONING Shopping experience, Image enhancement, services improvement New Decoration CONVENIENCE Strong and disruptive Marketing CAPEX Investment partnership with
Slide 69: 1. Experience vs Convenience
69 1. Experience vs Convenience 8% TOTAL RENTS 7% TOTAL RENTS 4% TOTAL RENTS Top 10 Retailers generate 40% of the rents 4% TOTAL RENTS 3% TOTAL RENTS 3% TOTAL RENTS Best Retailers per activity. Leaders in sales, visits and customer service 3% TOTAL RENTS 3% TOTAL RENTS 3% TOTAL RENTS
Slide 70: 1. Experience vs Convenience
70 1. Experience vs Convenience Outstanding Marketing Creating Dining Events Experience creating through connection Marketing with our customers Events ANEC BLAU ANEC BLAU ALBACENTER €56,000 400 9,000 K visitors economic followers impact
Slide 71: 2. Repositioning Capex
71 2. Repositioning Capex Refurbishment Projects Timeline: Las Huertas Albacenter Megapark El Rosal Nov 2016 June 2017 Q4 2017 June 2016 May 2017 Oct 2017 TBD Txingudi Vistahermosa P. Marina AnecBlau
Slide 72: 3. Technology
3. Technology Omnichannel presence to enhance Shopping and Social Experience Online/Offline Market Place Online Market Place Delivery Online Shopping Wi-Fi Facebook App Other Contact with Social your Client Web Twitter Youtube Networks Know your Client Seeketing (beacons) Footfall Market Surveys
Slide 73: 3. Technology
3. Technology IB CATEGORIAS 73 i) GARANTIA TIENES ) DIAS DE ELECTRONICA NUEVO ONIX SP Exteriores Bao HATTT thi APIA PAGO SEGURO EN TODAS TUS COMPRAS
Slide 74: 4. Sustainability
74 4. Sustainability Committed to being a sustainable and socially responsible business BREEAM Environmental Certifications OPERATING WATER CO2 COSTS CONSUMPTION 9% 1 40% 1 10% 1 Accessibility Certifications 1. 2016-2017 Target
Slide 75: Results
Results Albacenter Shopping Centre, Albacete
Slide 76: Key Financials of Our Portfolio
76 Key Financials of Our Portfolio Footfall Sales GLA Leased +8.6% vs. 1.5 Av. Footfall Index Spain H1 2016 +4.6% LfL 13,709 sqm 65 deals signed H1 2016 +19% Rent Uplift +12.5% vs. 3.1 Sales Index Spain H1 2016 14% Rotation since acquisition 1.4% Increase in occupancy Discounts Bad Debt Reduction Im
Slide 77: Investor Day
Investor Day Follow us: www.larespana.com Lar España Real Estate SOCIMI info@larespana.com Investor Day App
Slide 78: Non-Retail Strategy: An opportunistic approach
Non-Retail Strategy An opportunistic approach Investor Day www.larespana.com Jorge Pérez de Leza Grupo Lar Head of Non Retail October 2016
Slide 79: Non Retail Assets Portfolio overview
Non Retail Assets Portfolio overview Non Retail Assets: Non-Retail Assets 24% of LRE’s GAV Offices Logistics Residential Number of Assets 5 5 1 GLA (sqm) 50,460 161,838 9,453 Avg. Occupancy (%) 90.10% 100% n.a. GAV (€ Mn) 160 72 58 GAV (€ / sqm) 3,167 447 6,168 Passing Rent (€ Mn) 7 6 n.a. EPRA NIY
Slide 80: Madrid Office Market
Madrid Office Market Notable take up with slow ramp up in rents Vacancy rates by zone Key Figures Average rents by zone H1 2016 take up 220,900 sqm, + 7.5% vs H1 2015 Take up mainly coming from organic growth 7 consecutive quarters with >100 transactions signed Transaction average size of 95
Slide 81: Madrid Logistics Market
Madrid Logistics Market Good performance continues in 2016 Take Up Volume Local Regional National GDP (var.%) Stock (m2) Vacancy (%) Local Regional National H1 2016 take up 186,000 sqm, + 34% vs H1 2015 (which was record year) A2 axis (where Alovera is) concentrates 75% of the take up Avg. rent
Slide 82: Opportunistic approach to non retail assets
Opportunistic approach to non retail assets Core locations Focus on value add assets Focus on liquid markets Off market acquisitions Luxury residential in Madrid Management as a key element to Offices in Madrid and Barcelona generate value, leveraging on Grupo Logistics in main markets (
Slide 83: How does this strategy relate to LRE's non-retail assets
Examples How does this strategy relate to LRE’s N-RA Core locations Focus on value add assets Lagasca 99 located in the Salamanca Lagasca 99 was an off market district, best residential área in Madrid opportunity with a very difficult closing Offices in Madrid (Egeo, Arturo Soria, process Torr
Slide 84: Case Example 1: Lagasca - Unique development opportunity
Case Example 1: Lagasca 99 Unique development opportunity Asset Characteristics Asset Type Total GLA Residential 26,203 Sqm Construction Period Acquisition Price* 2016 - 2018 EUR 50 Mn Location €/m2 Lagasca 99, Juan Bravo 3, Madrid 3,807 €/sqm Asset Profile Location in Salamanca district, most exc
Slide 85: Case Example 1: Lagasca - Progress to Date
Case Example 1: Lagasca 99 85 Progress to Date 42% sold off market Commercial success of “off market“ commercialization, committing more than 42% of the product and with an impact on the sales over the initial estimate (10,000 € / sqm) Full marketing campaign launched in October Construction wor
Slide 86: Case Example 2: Torre Spínola
Case Example 2: Torre Spínola 86 Works completed on time and on cost Works completed BREEAM certification The best office building in a consolidated office area Great visibility from M-30 ring, the most travelled highway in Madrid Stunning city views Commercialization started (CBRE & Aguirre Newman
Slide 87: Case Example 3: Logistic Assets
Case Example 3: Logistic Assets Attractive NIYs at Acq. With 100% occupancy Alovera I, II, III & IV Almussafes Alovera I, II, III & IV Almussafes Acquisition Date Acquisition Price Acquisition Date Acquisition Price 07/08/2014 – 26/05/2015 EUR 55.01 Mn 26/05/2015 EUR 8.35 Mn Location Price per sqm L
Slide 88: Investor Day
Investor Day Follow us: www.larespana.com Lar España Real Estate SOCIMI info@larespana.com Investor Day App
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