Prodea Real Estate Investment Co. Sa · ATHEX:PRODEA
Prodea Real Estate Investment Co. Sa — Investor Presentation (September 2020)
34 slides from Prodea Real Estate Investment Co. Sa's investor presentation, September 2020
Slide 1: Company presentation
Company presentation September 2020
Slide 2: Disclaimer
Disclaimer By viewing or receiving this presentation, you are agreeing to be bound by the following limitations. The information contained in this presentation has been prepared by Prodea Real Estate Investment Company Societe Anonyme (the “Company”) and has not been independently verified and will
Slide 3: Senior management working together with the company since foundation
Senior management working together with the company since foundation Chris Papachristophorou Aris Karytinos Athanasios Karagiannis Theresa Messari Executive Chairman of the BoD CEO CIO General Manager, Chairman of the Investment COO and CFO Member of the Investment Committee Committee 27+ 6 30+ 9 10
Slide 4: Prodea Investments at a glance
Prodea Investments at a glance Company overview Key portfolio KPIs Best in Largest REIC in Greece(b) Largest Greek REIC with a €2.2bn portfolio and market class portfolio cap of €2.0bn(a) 97.1% Occupancy €2.2bn GAV 16(c) / 10(d) Footprint across Greece and Cyprus (“Hellenic market”) WAULT (years) an
Slide 5: Prodea Investments has a strong track record of growth
Prodea Investments has a strong track record of growth GAV (in €m) 2010 NBG founded Pangaea as its real estate subsidiary and (c) 2.225 (c) fully controlled REIC 2,218 Evolution of Greek 4 government bond (d) yield(a) 315 1.782 2013 Invel acquired 66% stake 31.7% (Jan, 2012) 144 1.583 1.473 1.492 71
Slide 6: Highly supportive and institutional shareholder base
Highly supportive and institutional shareholder base Shareholding structure Key shareholder Free float 2% ▪ Invel is a real estate investment and management company established in 2013 ▪ The combined transaction experience is in excess of €20bn of real estate GAV Invel / Invel Invel consortium – key
Slide 7: Clear and well defined strategy
Clear and well defined strategy Clear Disciplined Active asset Optimal strategic goals acquisition strategy management strategy financing strategy ✓ Enhance portfolio ✓ Invest in the core ✓ Maintain revenue ✓ Target <40% Net LTV diversification Hellenic market with visibility selective acquisitions
Slide 8: Off-market GAV growth: 3x €1.1bn
Prodea Investments is uniquely positioned to unlock off-market pipeline opportunities focused on Hellenic market Assets with solid fundamentals, rental growth and rental yield compression potential Selectiveness ✓Prime location ✓Attractive risk/return profile ✓Environmental efficiency GAV growth
Slide 9: Past acquisitions demonstrate Prodea Investments’ capabilities and investment strategy
Past acquisitions demonstrate Prodea Investments’ capabilities and investment strategy Cypriot CYREIT Commercial property, Athens HR Sale & Lease-back, Greece • Acquired 100% management shares and 88% • Acquired in 2018 at c.€6m • Acquired in 2014 at c.€116m investment shares of Cypriot CYREIT from
Slide 10: Access to unique value creation opportunities of €500m
Access to unique value creation opportunities of €500m €500m identified pipeline focused on Hellenic region ~90% off-market: banks/funds, corporations, developers, families, individual owners By segment By geography By type By status Value-add opportunities Exclusivity / 33% (a) DD Offices 21% 17% S
Slide 11: Key investment highlights
Key investment highlights 1 A unique, market leading platform with an ability to benefit from Greek macro recovery 2 High quality portfolio in strategic locations well diversified across geography and sector 3 Superior cash generation from high yielding well occupied portfolio with proven resiliency
Slide 12: Macro recovery momentum in Greece
1 Macro recovery momentum in Greece Greek economy has recovered and stabilised over past few Newly elected government committed to deliver macro years recovery 2016 2019 Δ ✓ Capital controls fully lifted GDP growth -0.3% 1.9% c.+215 bps ✓ Already implemented new tax legislation, resulting in lower t
Slide 13: A strong market leader representing the opportunity to play attractive real estate dynamics
1 A strong market leader representing the opportunity to play attractive real estate dynamics Greek real estate on an upward trajectory vs. rest of Europe Spread between GGB and Bund compressed Spread of 10-year GGB vs. Bund since 2017 (in bps) Companies free float(a) market cap since beginning of e
Slide 14: Unique portfolio of prime and modern assets, well diversified across geography and sectors
Unique portfolio of prime and modern assets, well diversified across 2 geography and sectors Well diversified portfolio across geography and asset class Landmark assets in the portfolio Breakdown by geography Karela Property, near Athens airport Other(a) GAV: €129m Italy 5% Occupancy: 100% WAULT: 23
Slide 15: Footprint across attractive and prime locations in Hellenic market
Footprint across attractive and prime locations in Hellenic market with 2 growing presence in neighbouring countries Map is not to scale Hellenic market: 330 properties in Greece and 26 properties in Cyprus Italy: 14 assets in 7 cities Value: €1,857m | GLA: 1,147k sq.m. | Occupancy: 97.0% | Key citi
Slide 16: High rental yielding portfolio with superior KPIs
3 High rental yielding portfolio with superior KPIs 7% Hotels 45% 22% 18% Retail big boxes & Directly Offices Bank branches high street retail Leased operated Total(a) No. of properties(b) 65 195 91 5 + 2 374 GLA(c) (000 sqm) 599 179 310 44 + 75 1,292 GAV Appraised value 2,218 (in €m)(c),(d) 993 490
Slide 17: Proven resiliency across the cycle with stable and high occupancy rates
3 Proven resiliency across the cycle with stable and high occupancy rates Office occupancy evolution Bank branches occupancy evolution 100% 100% 100% 100% 100% 100% 98% 98% 97% 98% 97% 97% 100% 96% 2014 2015 2016 2017 2018 2019 6M 2020 2014 2015 2016 2017 2018 2019 6M 2020 Retail big boxes & High st
Slide 18: A portfolio leased to strong creditworthy tenants
A portfolio leased to strong creditworthy tenants, comprising financial and 4 governmental institutions, as well as well-known corporates… Top 5 tenant mix Rent (%) NBG rental exposure evolution (NBG rent as % of total rent) ▪ One of Greece’s 99% National Bank largest banks in terms 44.0% of Greece
Slide 19: Embedded risk protection from long leases and multi-tenant base
… Providing embedded risk protection resulting from long leases 4 and significant multi-tenant base Only c.30% of total rental income today is expiring within the next 5 years % of rental income expiring (%) 25% 21% 15% 10% 9% 5% 6% 5% 3% 0% 0% 1% 0% 2020 2021 2022 2023- 2028 2029 2031 2032 2033 203
Slide 20: Prodea’s bank branches are located in prime urban locations suitable to capture retail demand
Prodea’s bank branches are located in prime urban locations suitable to 4 capture retail demand … with a proven track record of immediate lease up post Prodea branches are renowned for being in the best locations... conversion from retail bank branches to high street retail Alexandrou-polis, Evros H
Slide 21: Conservative long term capital structure and active balance sheet management
Conservative long term capital structure and active balance sheet 5 management Active balance sheet management Net LTV(a) ◼ In 2014, despite Greek economic crisis, the company successfully issued a €237.5m bond loan programme fully subscribed by a 35,5%(b) 36,5% reputable global asset manager 28,8%
Slide 22: Strong financial performance and robust financial structure
Strong financial performance and robust financial structure Revenue (a) Adjusted EBITDA (€m) : Effect from operating hotels (€m) : Effect from operating hotels 175 177 121 40 39 116 114 118 2.9% 11.8%(b) 1.6%(b) 101 1.1% 102 7.3%(b) (0.8)%(b), 7 6 118 121 136 138 101 102 109 108 2017A 2018A 2019A LT
Slide 23: Financial policy
Financial policy 1 ▪ Keep LTV at a conservative level with long term target of 35-40% Leverage ▪ Target in line with large REITs across Europe and very sustainable ▪ Growth plans within the framework of leverage target 2 ▪ Maintain access to multiple sources of funding, including both capital market
Slide 24: Key takeaways
Key takeaways Unique strategic opportunity… …targeting superior long-term value creation Macro market ✓ Greece at a turning point in economic recovery cycle Real estate cycle ✓ Yield compression underway momentum Best-in-class ✓ ✓ High quality portfolio in prime locations portfolio €500m of identifi
Slide 25: Appendix
Agenda Appendix 24
Slide 26: Office Real Estate Market in Greece
Office Real Estate Market in Greece: continues to enjoy a healthy performance despite a blip of inactivity during covid-19 lockdown Market outlook Prime office rental trends in Athens CBD and Kifisias avenue € per sqm / month ▪ CBD: € 18-22 /sqm/month (~35% below peak) Prime rent ▪ Prime rent in Kif
Slide 27: Retail Real Estate Market in Greece
Retail Real Estate Market in Greece: sector is anticipating a 2020-21 comeback in the aftermath of the covid-19 lockdown and reduced consumer spending Market outlook Prime high street rents in Athens ▪ Ermou: €180-230 /sqm/month (enhanced vs. 2008 peak) Prime rent ▪ Modest outlook fuelled by lower c
Slide 28: Logistics Real Estate Sector in Greece
Logistics Real Estate Sector in Greece: both investment and occupier market boast highest momentum Market outlook Prime warehousing & logistics rental trends in Greater Athens ▪ € 3.70-4.20 /sq m/month (c. 37% below peak) Prime rent €/ sq m/ month Aspropyrgos ▪ Rents continue to grow 7 6 ▪ Gross yie
Slide 29: Hotel market in Cyprus
Hotel market in Cyprus: attractive tourism dynamics impacted by covid-19 Number of arrivals (million)(a) Arrivals by nationality 2019 (Q1 2020) (b) 3.939 3.977 3.652 United 3.187 Kingdom Other Countries 2.659 31% (36%) 34% (30%) 2.392 2.465 2.405 2.441 2.141 2.173 Greece 4% (10%) 247 Germany 4% (4%)
Slide 30: Portfolio breakdown by geography and asset class
Portfolio breakdown by geography and asset class Office Bank branches Other 9% Rome 1% Other <1% Italy 1% Milan 7% Italy 20% Hellenic market 71% Hellenic Rome 12% market 99% GAV: ~€1.0bn Rest of Greece GAV: 42% ~€0.5bn Rest of Greece Attica 1% 47% Attica Cyprus 61% 5% Thessaloniki 4% Thessaloniki Re
Slide 31: Consolidated statement of financial position – IFRS
Consolidated statement of financial position – IFRS Amounts in € ’000s Dec-2017 Dec-2018 Dec-2019 Jun-2020 Assets Non-current assets Investment property 1,580,698 1,779,481 2,090,040 2,085,017 Equity method investments and joint ventures - - 11,006 15,604 Property and equipment 2,058 2,149 110,035 1
Slide 32: Consolidated income statement – IFRS
Consolidated income statement – IFRS Amounts in € ’000s Dec-2017 Dec-2018 Dec-2019 LTM Jun-2020 Rental income 117,943 121,363 135,611 137,844 Revenue from hospitality and ancillary services - - 33,092 27,912 Sale of development properties - - 6,273 10,951 Other 6 3 80 80 Revenue 117,949 121,366 175,
Slide 33: EBITDA and FFO calculations
EBITDA and FFO calculations 12M Period Ended EBITDA Amounts in € ’000s Dec-2017 Dec-2018 Dec-2019 LTM Jun-2020 Profit for the period 83,698 115,104 298,902 202,529 Plus: Depreciation of Property and Equipment and Amortisation of Intangible 54 53 3,553 5,333 Assets Plus: Net Finance costs 22,190 21,8
Slide 34: NAV & EPRA NAV break-down
NAV & EPRA NAV break-down Amounts in € ’000s Dec-2017 Dec-2018 Dec-2019 Jun-2020 Shareholders’ Equity 1,227,853 1,286,682 1,418,444 1,363,792 (less): IFRS Adjustment (a) (214) (62) 848 1,827 NAV 1,227,639 1,286,620 1,419,292 1,365,619 Y-o-Y Growth 4.8% 10.3% (3.8)% (a) Difference between the NBV and
Prodea Real Estate Investment Company — Investor Presentation (September 2020) on 6ix