Nepi Rockcastle N.v · JSE:NRP
Nepi Rockcastle — H1 2017 Earnings Presentation
43 slides from Nepi Rockcastle's earnings presentation, August 2017
Slide 1: Results Presentation August 2017
RESULTS PRESENTATION AUGUST 2017
Slide 2: Company profile
Company profile • Merger of NEPI and Rockcastle became effective as of 11 July 2017. • Leading property investment and development group in CEE, and one of the top ten listed real estate companies in Continental Europe by market capitalisation. • Dominant property portfolios in Romania, Poland and S
Slide 3: A leading commercial real estate company in CEE
A leading commercial real estate company in CEE NEPI Rockcastle is one of the top ten listed real estate companies in Continental Europe and the largest in CEE Continental European Real Estate landscape by market capitalisation 16 August 2017 (€bn) 25 21.8 20 17.2 15 12.3 10.7 10 9.5 6.7 6.4 6.1 5.5
Slide 4: Robust portfolio by scale and geographical diversification
Robust portfolio by scale and geographical diversification Increased geographical diversification and scale with primary focus on CEE market, benefitting from strong macro prospects Combined direct property portfolio Combined direct and indirect portfolio 47+28+96541 36+22+117543 by market value by
Slide 5: Well-positioned CEE direct property portfolio
Well-positioned CEE direct property portfolio High-quality portfolio characterised by: • mainly large/dominant shopping centres; • high-quality assets in densely populated areas or that have good macrodynamics; • low vacancy levels. weighted by ownership NEPI Rockcastle* SLOVAKIA Property value €4 0
Slide 6: Strategy
Strategy Strong strategic positioning oriented towards robust long-term growth Leading retail business Proven management team and business model • Portfolio of dominant retail assets in high growth CEE markets. • Internally managed business. • Focus on dominant retail malls in cities with superior •
Slide 7: NEPI Rockcastle's income-producing portfolio map (August 2017)
NEPI Rockcastle’s income-producing portfolio map (August 2017) RETAIL ROMANIA OFFICE ROMANIA 1 Mega Mall 43 City Business Centre 2 City Park 25 44 Floreasca Business Park 3 Promenada Mall 45 The Lakeview 4 Shopping City Sibiu 46 The Office Cluj-Napoca 5 Shopping City Timisoara 47 Victoriei Office 6
Slide 8: Combined key indicators as at 30 June 2017
Combined key indicators as at 30 June 2017* • Distributable earnings per share (euro cents): 23.46 • Adjusted NAV per share: €6.72 • Income-producing properties weighted by ownership: €3.8bn • Total GLA of 1.48 million m2 • NOI: €125m • Listed securities portfolio: US$1.33bn (equivalent of €1.16bn)
Slide 9: Direct portfolio overview
Direct portfolio overview INVESTMENT PROPERTY OVERVIEW AS AT 22 AUGUST 2017 (PRO FORMA) Weighted Weighted Weighted GLA Valuation Passing rent/ERV Occupancy Number '000m2 €m €m % TOTAL PROPERTIES 70 1 889 4 231 297 INCOME-PRODUCING 52 1 563 4 026 277 96.3% Retail 42 1 344 3 560 241 96.0% Office 8 191
Slide 10: Listed securities portfolio and strategy
Listed securities portfolio and strategy • Strategic emphasis on companies which dominate their respective regions and consistently outperform their competitors. • Portfolio concentration on larger, more liquid counters in developed markets, with sustainable growth. • Bias toward US, UK and European
Slide 11: Finance strategy
Finance strategy Robust balance sheet DEBT MATURITY PROFILE AS AT 30 JUNE 2017 (€m) 800 • Funding through a combination of equity, debt and sale of the listed securities portfolio. 600 • Investment grade credit ratings: Baa3, positive outlook - Moody’s BBB, stable outlook - Standard & Poor’s 400 • 6
Slide 12: Retail operational highlights
Retail operational highlights* Romania Croatia • 7.7% in turnover • 9.4% in turnover • 4.2% in footfall • -2.3% in footfall Poland Czech Republic • 7.6% in turnover • 4.0% in turnover • -2.0% in footfall • 0.0% in footfall Slovakia Serbia • 4.3% in turnover • 0.9% in turnover • 0.9% in footfall • 2.
Slide 13: Top 10 retail tenants by rent
Top 10 retail tenants by rent Sustainable anchor tenant base 5% 4% * 3% ** 3% 2% 2% 2% 1% 1% 1% * Bershka, Massimo Dutti, Oysho, Pull and Bear, Stradivarius and Zara ** Reserved, Cropp Town, House, Mohito, Sinsay RESULTS PRESENTATION – AUGUST 2017 13
Slide 14: Contracted gross rent
Contracted gross rent Long-term lease duration €m 300 250 200 150 100 50 0 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026+ Retail Office Industrial Weigthed average remaining duration is 4.3 years RESULTS PRESENTATION – AUGUST 2017 14
Slide 15: Macroeconomic prospects - future growth prospects in CEE
Macroeconomic prospects - future growth prospects in CEE % % Real GDP growth General gov. debt (% of GDP) 5 100 4 80 3 60 40 2 20 1 0 0 2016 2017 2018 2019 2020 2021 2016 2017 2018 2019 2020 2021 CEE is the growth engine of the EU economy, developing faster than Western Europe. The general governmen
Slide 16: 10-year forecasted growth
CEE private consumption forecasted growth 120% 120% Serbia €26bn 100% 100% Baltic 10-year forecasted growth countries €55bn 80% Poland 80% €267bn Bulgaria Hungary Slovakia 60% €30bn €60bn €46bn Slovenia 60% €21bn Czech Romania Croatia Republic 40% €113bn €28bn €87bn 40% EU 15 20% 20% 0 0 €2 000 €3 0
Slide 17: Serdika Center and Office
Serdika Center and Office SOFIA PROVINCE (BULGARIA) 1 558 000* INHABITANTS SOFIA CITY 1 324 000 * Sofia Province together with Sofia City St. Alexander Nevsky Cathedral RESULTS PRESENTATION – AUGUST 2017 17
Slide 18: Serdika Center and Office
Serdika Center and Office CATCHMENT AREA 30’ - 919 000 15’ - 327 000 5’ - 49 000 RESULTS PRESENTATION – AUGUST 2017 18
Slide 19: Serdika Center and Office
Serdika Center and Office • The shopping mall is only a 5-minute drive from Sofia's main Ownership 100% motorway Trakiya, 10 minutes from Sofia Airport and 10 minutes from the centre. Type Regional Mall and Office • Excellent tenant mix with anchors such as Billa, H&M, Lettable area - retail 51 500m
Slide 20: Serdika Center and Office
Serdika Center and Office FLOOR PLAN FIRST FLOOR GROUND FLOOR BASEMENT RESULTS PRESENTATION – AUGUST 2017 20
Slide 21: Completed office projects
Completed office projects The Office Cluj-Napoca - extension Victoriei Office • Third phase completed with 20,200m2 GLA. • The landmark office is almost fully let, with tenants gradually taking over their premises until October 2017. • Third phase is 96% leased. • Tenants include renowned companies
Slide 22: Acquisitions, developments and extensions pipeline
Acquisitions, developments and extensions pipeline ACQUISITIONS PIPELINE (€ MILLION) JUN 2017 )500( 0 500 1000 1500 2000 Money spent Committed Further opportunities under due dilligence Further opportunities DEVELOPMENTS AND EXTENSIONS PIPELINE (€ MILLION) JUN 2017 )500( 0 500 1000 1500 2000 Finalis
Slide 23: Developments
Developments Poland 5 WOLOMIN UNDER CONSTRUCTION 5 5 ZIELONA ZIELONAGORA GORA 1. Promenada Novi Sad - Phase I 7 2. Ramnicu Valcea Mall OPOLE 3. Shopping City Galati extension 4 ZABRZE 4. Platan Shopping Centre extension 5. Galeria Wolomin extension UNDER PERMITTING AND PRE-LEASING 1. Promenada Mall
Slide 24: Schedule of developments and extensions as at June 2017
Schedule of developments and extensions as at 30 June 2017 Target GLA of opening existing GLA of Weighted Weighted Country Type Category date Ownership property development cost to date total cost % m2 m2 €m €m Developments under construction 76 900 120 800 66.0 237.2 Promenada Novi Sad - Phase I Se
Slide 25: Promenada Novi Sad - Phase I (Serbia)
Promenada Novi Sad - Phase I (Serbia) DEVELOPMENT UNDER CONSTRUCTION CATCHMENT AREA 45’ - 607 000 30’ - 354 000 15’ - 211 000 VOJVODINA REGION 1 892 000 INHABITANTS NOVI SAD CITY - 319 000 Promenada Novi Sad (56,000m2) Mercator Center (18,000m2) BIG Center (34,000m2) RESULTS PRESENTATION – AUGUST 20
Slide 26: Promenada Novi Sad - Phase I (Serbia)
Promenada Novi Sad - Phase I (Serbia) DEVELOPMENT UNDER CONSTRUCTION RENDER • Novi Sad is the second largest city in Serbia, 70 km from the Ownership 100% capital, Belgrade, and is connected by international highways Total estimated lettable area 56 000m2 to Budapest, Vienna, Belgrade, Zagreb and Sk
Slide 27: Promenada Novi Sad - Phase I (Serbia)
Promenada Novi Sad - Phase I (Serbia) DEVELOPMENT UNDER CONSTRUCTION FLOOR PLAN SECOND FLOOR FIRST FLOOR GROUND FLOOR BASEMENT one level of parking on the third floor not presented RESULTS PRESENTATION – AUGUST 2017 27
Slide 28: Ramnicu Valcea Mall (Romania)
Ramnicu Valcea Mall (Romania) DEVELOPMENT UNDER CONSTRUCTION CATCHMENT AREA 45’ - 315 000 30’ - 156 000 15’ - 115 000 VALCEA COUNTY 360 000INHABITANTS RAMNICU VALCEA CITY - 119 000 Ramnicu Valcea Mall (27,900m2) River Plaza Mall (12,400m2) Winmarkt (11,400m2) Family Center (6,000m2) RESULTS PRESENTA
Slide 29: Ramnicu Valcea Mall (Romania)
Ramnicu Valcea Mall (Romania) DEVELOPMENT UNDER CONSTRUCTION RENDER • Construction is ongoing for the regional mall in Ownership 100% Ramnicu Valcea. Estimated lettable area 27 900m2 • The development will include a Carrefour hypermarket, Targeted opening December 2017 Cinema City and numerous natio
Slide 30: Ramnicu Valcea Mall (Romania)
Ramnicu Valcea Mall (Romania) DEVELOPMENT UNDER CONSTRUCTION FLOOR PLAN FIRST FLOOR GROUND FLOOR RESULTS PRESENTATION – AUGUST 2017 30
Slide 31: Shopping City Galati - extension (Romania)
Shopping City Galati - extension (Romania) DEVELOPMENT UNDER CONSTRUCTION CATCHMENT AREA 45’ - 559 000 30’ - 368 000 15’ - 310 000 GALATI COUNTY 520 000 INHABITANTS GALATI CITY - 305 000 Shopping City Galati (27,500m2) Braila Mall (55,400m2) RESULTS PRESENTATION – AUGUST 2017 31
Slide 32: Shopping City Galati - extension (Romania)
Shopping City Galati - extension (Romania) DEVELOPMENT UNDER CONSTRUCTION RENDER • The extension will include a cinema, food court and additional Ownership 100% fashion offering. Lettable area - Property in use 27 500m2 • The extended mall will share access and parking with the Estimated lettable ar
Slide 33: Shopping City Galati - extension (Romania)
Shopping City Galati - extension (Romania) DEVELOPMENT UNDER CONSTRUCTION FLOOR PLAN EXISTING SHOPPING CENTRE EXTENSION FIRST FLOOR GROUND FLOOR RESULTS PRESENTATION – AUGUST 2017 33
Slide 34: Platan Shopping Centre - extension (Poland)
Platan Shopping Centre - extension (Poland) DEVELOPMENT UNDER CONSTRUCTION RENDER • Extension and refurbishment works, including the construction Ownership 100% of a multi-level car park, started in June 2017. Lettable area - Property in use 25 200m2 • Increase the shopping centre’s GLA to 40,300m2.
Slide 35: Platan Shopping Centre (Poland)
Platan Shopping Centre (Poland) DEVELOPMENT UNDER CONSTRUCTION FLOOR PLAN FIRST FLOOR GROUND FLOOR RESULTS PRESENTATION – AUGUST 2017 35
Slide 36: Galeria Wolomin - extension (Poland)
Galeria Wolomin - extension (Poland) DEVELOPMENT UNDER CONSTRUCTION • The retail park adjoining the existing Galeria Wolomin Ownership 100% shopping centre. Lettable area - Property in use 24 200m2 • Increase the total retail GLA to approximately 30,700m2. Estimated lettable area - extension 6 600m2
Slide 37: Galeria Wolomin - extension (Poland)
Galeria Wolomin - extension (Poland) DEVELOPMENT UNDER CONSTRUCTION FLOOR PLAN RESULTS PRESENTATION – AUGUST 2017 37
Slide 38: Developments under permitting and pre-leasing
Developments under permitting and pre-leasing Shopping City Targu Mures - Phase I, Romania Shopping City Satu Mare, Romania RENDER RENDER • Planned to have two phases of development. • Zoning obtained in July 2017. The project will be a regional dominant retail scheme, located in the city centre. •
Slide 39: Developments under permitting and pre-leasing » continued
Developments under permitting and pre-leasing » continued Focus Mall Zielona Gora - extension, Poland Krusevac & Sabac Retail Park, Serbia RENDER RENDER • Extension enabling the current mall to retain its dominant • 8,500 - 9,000 m2 GLA retail parks positioned next to a Lidl position in the city and
Slide 40: Developments under permitting and pre-leasing » continued
Developments under permitting and pre-leasing » continued Solaris Shopping Centre - extension, Poland RENDER • The additional GLA represents approximately 50% of the Ownership 100% existing property. Estimated lettable area 9 200m2 • The redevelopment introduces a greater efficiency of current Targe
Slide 41: Conclusions
Conclusions • Strong position in CEE market – dominant asset base, proven track record and optimal capital structure. • Positive market fundamentals. • Substantial acquisition and development pipeline, with material portion in controlled developments. • Ability to secure further growth opportunities
Slide 42: Disclaimer
Disclaimer NEPI Rockcastle plc is a commercial property investor and developer, listed on the Main Board of the Johannesburg Stock Exchange Limited (JSE) and Euronext Amsterdam (AEX). The information in this presentation has been included in good faith but is for general informational purposes only.
Slide 43: RESULTS PRESENTATION – AUGUST 2017
RESULTS PRESENTATION – AUGUST 2017 43