Helios Re Socimi, S.a. · BME:SCHLR
Helios Re Socimi — Lar España Real Estate SOCIMI — Investor Presentation (May 2018)
51 slides from Helios Re Socimi's investor presentation, May 2018
Slide 1: Corporate Presentation
CORPORATE PRESENTATION www.larespana.com The Spanish Retail Specialist May 2018
Slide 2: Index
Index 01 02 03 04 05 Company Investment Financial ESG Appendix 1 Description Highlights Results Results Appendix 2
Slide 3: Company Description
01 Company Description
Slide 4: Snapshot
01 Company Description 4 Snapshot Shareholder Structure First IPO of a Spanish REIT listed on the Spanish Stock Exchange Other investors PIMCO 43.0% 19.6% Focused on creating both sustainable income and strong capital returns for shareholders Franklin Lar España is managed by Grupo Lar, private Real
Slide 5: Portfolio at a glance
01 Company Description 5 Portfolio at a glance GAV1 €1.54 Bn Other Assets 18% Retail 82% Unique exposure to real Resilient prime dominant Recurrent cash flow estate retail assets and the shopping centers in generation @ 5.4% Net Spanish consumer and EPRA Annualized Net Rent €73.3 Mn attractive catch
Slide 6: A Cherry Picked Portfolio
01 Company Description 6 A Cherry Picked Portfolio Retail Acquisitions Other Assets Acquisitions Alovera II As Termas Divestments Portal de la Alovera III Marina Egeo Alovera IV Nuevo Alisal Almussafes Palmas Altas Megapark Albacenter P. Marina Development Hypermarket Hypermarket Leisure Area P. Mar
Slide 7: Major corporate milestones from 2017 & Q1 2018
01 Company Description 7 Major corporate milestones from 2017 & Q1 2018 JAN MAR MAY JUL SEP DEC FEB +15.8% Abadía Retail Dividend +19.5% Vidanova Parc Analyst Day Rivas Futura Asset Revaluation Park Acquisition Payment Asset Revaluation Credit for Construction Acquisition since Acq. 22 Retail Units
Slide 8: Board of Directors & Critical Activities
01 Company Description 8 Board of Directors & Critical Activities Independent and experienced Board: 5 independent directors (5 out of 7) Critical Activities internalized José Luis del Valle Roger Cooke Pedro Luis Uriarte Sergio Criado Jon Armentia Susana Guerrero Chairman and Independent Independen
Slide 9: External Manager: A Real Estate Reference
01 Company Description 9 External Manager: A Real Estate Reference Grupo Lar now owns a 5.7% stake in Lar España, subject to a lock-up period Manager New IMA recently signed Grupo LAR Key Facts 1 Family owned Company +40Y of experience Retail Offices 39 Shopping centres 9 Office buildings developed
Slide 10: Investment Strategy Focused in Retail
01 Company Description 10 Investment Strategy Focused in Retail Investment Target Creation of unique shopping Criteria 100% experiences levered ownership IRR>12% Customer journey analysis Value-Creation Potential Optimum size for area of influence Dominant Optimal and fine-tuned tenant line-up Core+
Slide 11: The value of a retail platform
01 Company Description 11 The value of a retail platform Main market players by owned GLA, Lar España has a clear objective to consolidate among the including GLA under development1 top retail operators in Spain: target to selectively increasing GLA to generate revenue synergies Peer 1 584,222 14 La
Slide 12: Strong Transformation + Innovation
01 Company Description 12 Strong Transformation + Innovation Transformation Strategy Digital Innovation Big Data Customer Intelligence Full Market Connectivity Knowledge Webs Seeketing APPS System WIFI Social Media E-Beacons c.95k 30% 35 sqm Rotation Rate since Leased since Relettings + New Lettings
Slide 13: Business Plan Guidance 2018-2021
01 Company Description 13 Business Plan Guidance 2018-2021 Target Returns ▪ 12% Target Annual Return on investments ▪ €380m of divestments over the next 24 months From Office, residential and non-core retail assets Divestments ▪ >€90 Mn of divestments From all logistics assets ▪ Finance all existing
Slide 14: Investment Highlights
02 Investment Highlights
Slide 15: Top 10 Value Drivers
02 Investment Highlights 15 Top 10 Value Drivers 10 1 Attractive Dividend Momentum of Real Policy Estate in Spain /Yield Compression 9 2 ANNUALIZED NET RENT NET LTV €73.3 Mn 33% Optimal Debt Upside from the Retail Management Existing Portfolio CURRENT POTENTIAL ANNUALIZED AVG. COST OF DEBT NET RENT
Slide 16: Value Driver 1: Momentum of RE in Spain / Yield Compression
02 Investment Highlights 16 Value Driver 1: Momentum of RE in Spain / Yield Compression 1 2 3 4 5 6 Spanish economy has been It is expected to continue Consumer´s Confidence Unemployment Rate Future Investment Spanish Real Estate surprising on the upside outperforming the keeps growing in line with
Slide 17: Value Driver 2: Potential from the Existing Retail Portfolio
02 Investment Highlights 17 Value Driver 2: Potential from the Existing Retail Portfolio +c.60% +5.6% +6.4% +c.8% >6% Estimated Rental Topped-Up NIY Topped-Up Expected NIY Expected NIY Increase Potential Reversionary NIY Future Investments 15 c.110 Existing Developments Existing Income 15 94 Generat
Slide 18: Value Driver 3: Strong Operating Results
02 Investment Highlights 18 Value Driver 3: Strong Operating Results Lar España is outperforming the market Letting activity at the core of the strategy Sales Q1 2018 Visits Q1 2018 +9.3% €147.3 Mn 13.6 Mn RENTAL GROWTH Lar España 5% Footfall ANNUALIZED Lar España +1.7% ROTATION RATE Retail Sales +3
Slide 19: Value Driver 3: Strong Operating Results
02 Investment Highlights 19 Value Driver 3: Strong Operating Results All figures refer to Q1 2018 period Vs Q1 2017 Active Asset & Tenant €18.3 Mn €0.4 Mn Management LfL Occupancy Rate LfL NOI GRI LfL Mall Income + Growth Growth Growth Growth Incentives to Tenants Smart Capex in Operating +1.9 p.p.
Slide 20: Disruptive projects differentiating among our competitors
02 Investment Highlights 20 Value Driver 4: Innovation Strategy Disruptive projects differentiating among our competitors To position Lar España To create shared value to lead economic and as the leader in digital transformation social progress, and also generate financial in the retail sector retur
Slide 21: Disruptive projects differentiating among our competitors
02 Investment Highlights 21 21 Value Driver 4: Innovation Strategy Disruptive projects differentiating among our competitors Big Data Full Conectivity Market Knowledge Market Place DIGITALIZATION & WEBS DIFFERENTIATION CUSTOMER APPS SEEKETING SYSTEM TRANSACTIONAL INTELLIGENCE WIFI E-BEACONS WEB SOCI
Slide 22: Value Driver 5: Developments – Lagasca99
02 Investment Highlights 22 Value Driver 5: Developments – Lagasca99 VALUATION GLA Sqm Location Purchase Date 26,203 Madrid 30 January 2015 €176 Mn In process Acquisition Price1 Market Value (Mar 2018)1 €50.1 Mn €88.0 Mn 1Corresponds to the 50% of the JV with Pimco High interest from national and in
Slide 23: Value Driver 5: Developments – Vidanova Parc
02 Investment Highlights 23 Value Driver 5: Developments – Vidanova Parc Opening Pre Letting Expected Rent All-in Costs Building Permit 2 Expected Date % of GLA € Mn € Mn Edification Works Owned 45,136 Q3 2018 98% >4.0 45.7 09/2017 Plot acquired in 2015 ACQUISITION PRICE €14 Mn MARKET VALUE (MAR 18)
Slide 24: Value Driver 5: Developments – Vidanova Parc
02 Investment Highlights 24 Value Driver 5: Developments – Vidanova Parc VidaNova Parc will be a reality in July 2018 ALL TENANTS SIGNED
Slide 25: Value Driver 5: Developments – Palmas Altas
02 Investment Highlights 25 Value Driver 5: Developments – Palmas Altas Opening Pre Letting Expected Rent All-in Costs Building Permit AREA1 2 Expected Date % of GLA € Mn € Mn Edification Works Owned 100,000 Q2 2019 63% c.15.0 191.1 07/2017 Plot acquired in 2016 8 Inditex Tenants already signed Bran
Slide 26: Value Driver 6: Attractive valuation of the existing portfolio FY 2017
02 Investment Highlights 26 26 Value Driver 6: Attractive valuation of the existing portfolio FY 2017 Total Portfolio Portfolio Value evolution LfL 2017/16 Since Acquisition € Mn Portfolio Value 28.5% 21.7% 61.5% 11.1% ASSET MANAGEMENT IMPACT Valuation Growth CAGR1 1,538 1,536 12.5% 9.3% 38.5% 1,275
Slide 27: Value Driver 6: Attractive valuation of the developments Q1 2018
27 02 Investment Highlights Value Driver 6: Attractive valuation of the developments Q1 2018 <2 MONTHS LEFT <12 MONTHS LEFT <3 MONTHS LEFT FOR THE START FOR VIDANOVA’S OPENING FOR PALMAS ALTAS’ OPENING OF LAGASCA 99 DELIVERY Given the level of progress on the developments and the refurbishment of El
Slide 28: Value Driver 7: Asset Rotation Policy Aimed at Maximizing Returns
02 Investment Highlights 28 Value Driver 7: Asset Rotation Policy Aimed at Maximizing Returns 2018 ACQUISITIONS 2018 DIVESTMENTS 6.2% 4.9% Avg. NIY €75.6 Mn €112.5 Mn Avg. NIY RIVAS FUTURA RETAIL PARK EGEO OFFICE BUILDING NET INITIAL SALE PRICE YIELD LOCATION GLA +22.2% LOCATION GLA c.6.0% Madrid 18
Slide 29: Value Driver 7: Asset Rotation Policy Aimed at Maximizing Returns
02 Investment Highlights 29 Value Driver 7: Asset Rotation Policy Aimed at Maximizing Returns Remaining non-core assets will add value in the coming months Offices Logistics VALUATION1 VALUATION2 €94 Mn €87 Mn +17 p.p. occupancy 5.3 100% 1.7 increase WAULT Occupancy maintained in all WAULT in Marcel
Slide 30: Value Driver 8: Acquisition Pipeline Aimed at Increasing Retail Platform
02 Investment Highlights 30 Value Driver 8: Acquisition Pipeline Aimed at Increasing Retail Platform Current Opportunities +€220 Mn of Investment Pipeline ✓ Large and visible pipeline Short Term Pipeline 110k+ including actionable off-market acquisitions with yields in the 6% area Asset Class Aprox.
Slide 31: Value Driver 9: Debt Management as a Means of Value Creation
02 Investment Highlights 31 Value Driver 9: Debt Management as a Means of Value Creation Key Figures of the financing Back-loaded Amortization Profile €589.4 Mn € Mn €140 Mn Senior Secured Bond €449.4 Mn Bank Debt 33% Net Loan to Value (LTV) 257.8 208.2 140.0 100.7 Avg. Cost of Debt 2.2% 3.8 5.5 13.
Slide 32: Value Driver 10: Predictable and Sustainable Dividend Distribution Policy
02 Investment Highlights 32 Value Driver 10: Predictable and Sustainable Dividend Distribution Policy ✓ Predictable and ✓ Competitive in the ✓ Attractive vs ✓ As a result of a Dividend policy sustainable dividend International Real Spanish equity solid cash flow objectives and distribution schedule
Slide 33: Value Driver 10: Consistent dividend growth per share
02 Investment Highlights 33 Value Driver 10: Consistent dividend growth per share 4th DIVIDEND IN 4 YEARS 55 0.55 €0.49 ps €45.0 Mn 5.1% DIVIDEND YIELD 45 0.45 2017 DIVIDEND ON NAV1 €0.33 ps €45.0 Mn 0.35 Dividend approved by the AGM 35 +50% and to be paid on VS 2016 €0.20 ps €30.0 Mn 0.25 18th MAY
Slide 34: Financial Results Q1 2018
03 Financial Results Q1 2018
Slide 35: Successful & Strong Key Facts delivered in Q1 2018
03 Financial Results 35 Successful & Strong Key Facts delivered in Q1 2018 +10% vs €1,536 Mn GAV 1 Q1 2017 €33.2 Mn Net Profit €10.47 EPRA NAV €968.8 Mn EPRA NAV pre-divestment fee per share 2 Rental +9% vs EPRA EPRA €19.6 Mn Income Q1 2017 5.6% “topped-up” NIY 5.4% Net Initial Yield 2018 +24% Sale
Slide 36: Solid Company performance in Q1 2018
03 Financial Results 36 Solid Company performance in Q1 2018 €19.6 Mn Revenues +9% vs Q1 2017 €968.8 Mn EPRA NAV €10.47 p.s.1 01 Solid Q1 2018 Results and Balance Sheet 33% Net LTV; €589.4 Mn Gross Debt 2.21% cost of debt Retail NOI LfL improvement +5.0% LfL 02 Impressive Performance of the Business
Slide 37: Consolidated Income Statement
03 Financial Results 37 Consolidated Income Statement (€ Millions) Chg (%) Rec. Q1 2018 Q1 2017 Q1-18/Q1-17 2 Recurring Non-Recurring Total Recurring Non-Recurring Total2 Rental Income 19.6 - 19.6 18.0 - 18.0 Other Income 0.4 - 0.4 0.6 - 0.6 Property Operating Expenses (4.5) - (4.5) (4.1) - (4.1) Ba
Slide 38: ESG Results
04 ESG Results
Slide 39: ESG - Asset Management & Environment
04 ESG Results 39 ESG - Asset Management & Environment 1 Responsible asset management focused on consumptions and emissions Promoting sustainability certification measures, CSR Master Plan to meet the encouraging the use of new technology to improve our assets’ environmental quality and most demandi
Slide 40: ESG - Corporate Governance
04 ESG Results 40 ESG - Corporate Governance Risk Control & Management System Integrated enterprise risk management (ERM) system designed to mitigate the risks exposure ERM system involves all Lar España’s staff and Risk Map: the ERM system categorises risk into high, 1 supervising of third parties
Slide 41: Appendix 1
05 Appendix 1
Slide 42: Retail Assets
05 Appendix 1 42 42 Retail Assets Megapark Gran Vía P. Marina El Rosal Anec Blau As Termas P. Altas P. Abadía4 Bilbao Vigo Alicante Ponferrada Barcelona Lugo Seville Toledo Development Market Value €214.0 Mn €163.0 Mn €119.8 Mn €109.0 Mn €95.4 Mn €84.2 Mn €82.4 Mn1 €79.0 Mn (Dec 2017) GLA (Sqm) 83,3
Slide 43: Retail Assets
05 Appendix 1 43 43 Retail Assets Rivas Albacenter 22 R. Units Vistahermosa Vidanova Parc Madrid Albacete North Spain + Alicante Valencia Balearic Islands Development Other Assets4 Market Value €61.6 Mn €56.3 Mn €52.5 Mn €50.4 Mn €29.8 Mn1 €62.3 Mn (Dec 2017) GLA (Sqm) 36,726 27,890 28,822 33,550 44
Slide 44: Offices, Logistics and Residential
05 Appendix 1 44 44 Offices, Logistics and Residential Office Logistics Residencial Lagasca99 Market Value Market Value €94.0 Mn1 €91.9 Mn €176.0 Mn3 (Dec 2017) (Mar 2018) GLA (Sqm) 23,816 280,000 GLA (Sqm) 26,203 Acquisition Date NA NA Acquisition Date 30 Jan ´15 Acquisition Price €51.4 Mn €65.6 Mn
Slide 45: Appendix 2
05 Appendix 2
Slide 46: Highlights of the Investment Management Agreement
05 Appendix 2 46 Highlights of the Investment Management Agreement 1 Alignment with current Business Plan 7 2 Unanimously approved by the seven REINFORCING PRESENCE Enhanced Corporate Provides continuity OF INDEPENDENT members of the Board Governance and certainty DIRECTORS IN THE BOARD (5 independe
Slide 47: External management by Grupo Lar continues to be the optimal strategy for Lar España
05 Appendix 2 47 External management by Grupo Lar continues to be the optimal strategy for Lar España Retail property requires skilled, hands-on management… …which Grupo Lar is uniquely qualified to provide ▪ Granular unit configuration and diverse ▪ Lar España can draw upon the expertise Operationa
Slide 48: Recognitions
Recognitions
Slide 49: Recognitions
49 Recognitions 2017 EPRA BPR & sBPR Awards Since June 2015: Member of FTSE EPRA/Nareit Global Estate Index First SOCIMI to be awarded with the "EPRA Recognition of the CSR GOLD AWARD” in Financial Reporting for the work and progress made 3rd consecutive year this year Sustainability Certification A
Slide 50: Disclaimer
50 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 n
Slide 51: Corporate Presentation
Corporate Presentation Follow us: www.larespana.com Lar España Real Estate SOCIMI info@larespana.com Lar España App
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