Merlin Properties Socimi, S.a. · BME:MRL
Merlin Properties Socimi — 6M 2024 Earnings Presentation
42 slides from Merlin Properties Socimi's earnings presentation, Jul 22, 2024
Slide 1: 6M24 Results Presentation
6M24 RESULTS PRESENTATION 2 2 J U LY 2 0 2 4
Slide 2: Disclaimer
DISCLAIMER This presentation has been prepared certain assumptions and estimates. These offering, will not be registered under the This presentation may include forward- by MERLIN Properties SOCIMI, S.A. (the internal analyses may have not been verified U.S. Securities Act of 1933, as amended (the l
Slide 3: Contents
■ 6M24 Financial results ■ Offices ■ Logistics ■ Shopping centers CONTENTS ■ Valuation and debt position ■ Logistics Best Plan ■ Digital Infrastructure Plan Ismael Clemente Miguel Ollero CEO COO ■ Closing remarks & Outlook
Slide 4: Key highlights | Overview
Key highlights | Overview Operating performance • Strong operating performance overall, with solid LfL rental growth (+2.8%), positive release spread and high occupancy levels • Continued performance in Offices with robust release spreads, good LfL growth and guiding to higher occupancy in FY24 (ca.
Slide 5: 6M24 Financial Results
6M24 FINANCIAL RESULTS
Slide 6: 6M24 Financial results
6M24 Financial results (€ million) 6M24 6M23 YoY Gross rents 248.2 237.8 +4.4% Gross rents after incentives 234.5 222.4 +5.4% Net rents(1) 208.6 201.1 +3.7% EBITDA(2) 188.4 181.7 +3.7% Margin 75.9% 76.4% FFO(3) 147.8 147.4 +0.3% Margin 59.5% 62.0% AFFO 142.5 140.8 +1.2% IFRS net profit 132.8 (47.5)
Slide 7: GRI bridge
6M24 Financial results | GRI bridge STRONG OPERATING PERFORMANCE RESULTING IN A GOOD RENTAL GROWTH (+2.8%) (€m) +1.8% Offices LfL(1) +4.1% Logistics +2.8% +3.3% Shopping centers 237.8 +6.5 +3.9 248.2 6M23 Like-for-Like Balance acquisitions, 6M24 growth disposals & other 7 (1) Portfolio in operation
Slide 8: Occupancy and WAULT
6M24 Financial results | Occupancy and WAULT OVERALL OCCUPANCY STABLE (-35 BPS VS 3M24), SET TO IMPROVE TOWARDS YEAR-END Occupancy and WAULT to first break per asset type(1) -35 bps 97.6% 96.0% 98.0% 95.4% n.a. MERLIN 92.3% Average 8.0 6.3 3.2 3.0 3.1 MERLIN 2.2 Average Offices Logistics Shopping ce
Slide 9: Offices
OFFICES
Slide 10: Offices | GRI bridge and breakdown
Offices | GRI bridge and breakdown MADRID OVERTAKING BARCELONA IN OCCUPANCY LfL(1) (€m) +1.8% 127.1 +2.3 +5.2 134.6 6M23 Like-for-Like growth Balance acquisitions, 6M24 disposals & other LfL growth by area Occupancy by area 3M24 6M24 Madrid +2.5% Madrid 90.7% +85 bps 91.5% Barcelona (1.4%) Barcelona
Slide 11: Offices | Leasing activity
Offices | Leasing activity Contracted sqm #Renewed contracts Release spread Tenants contracted Madrid 82,801 83 +1.9% Barcelona 9,264 31 (1.1%) Lisbon 869 5 (0.2%) Total 92,934 119 +1.1% 11
Slide 12: Offices | Flex space
Offices | Flex space 3 NEW SPACES OPENED IN THE SEMESTER PLUS 3 SPACES TO OPEN BEFORE YEAR-END KPIs 28,845 sqm 2,868 desks 82% occupancy 13 spaces € 399 ADR(1) Openings in 1H24 El Viso 70 desks Torre Glòries (extension) 75 desks Plaza Cataluña (extension) 80 desks 3 new openings in 2H24 Plaza Ruiz P
Slide 13: Offices | Recovery in the A-1 corridor
Offices | Recovery in the A-1 corridor OCCUPANCY IN THE A-1 HAS INCREASED BY CA. 80K SQM SINCE 2018, EQUIVALENT TO 18% OCCUPANCY GAIN Alcobendas 308k sqm 25k sqm Total stock Vacant FY24(1) Largest Business Hub concept in Europe Moraleja residential area 28 assets +64k users +7k users Services & 77 t
Slide 14: Logistics
LOGISTICS Mh ——
Slide 15: Logistics | GRI bridge and breakdown
Logistics | GRI bridge and breakdown LfL(1) (€m) +4.1% 39.7 +1.6 +0.7 42.0 6M23 Like-for-Like growth Balance acquisitions, 6M24 disposals & other LfL growth by location Occupancy by area 3M24 6M24 Madrid +4.2% Madrid 98.4% 98.4% +2 bps Barcelona +6.8% Barcelona 95.7% 93.5% (222 bps) Other +2.5% Othe
Slide 16: Logistics | Leasing activity
Logistics | Leasing activity Contracted sqm #Renewed contracts Release spread Tenants contracted Madrid 55,950 8 +2.1% Barcelona - 2 +12.1% Other 6,534 Total 62,484 10 +2.9% 16
Slide 17: Logistics | ZAL Port
Logistics | ZAL Port STRONG PERFORMANCE Stock 765,006 sqm Third parties stock (ground leases) 156,306 sqm Stock under management 921,312 sqm Tenants Contracted sqm Release spread # contracts 115,953 (1.7%) 32 Occupancy by area 98.4% (48 bps) 97.9% €m 6M24 6M23 YoY Gross rents 37.7 37.9 (0.3%) EBITDA
Slide 18: Shopping centers
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Slide 19: Shopping centers | GRI bridge and breakdown
Shopping centers | GRI bridge and breakdown LfL(1) (€m) +3.3% 64.2 +2.0 63.4 (2.8) 6M23 Like-for-Like growth Balance acquisitions, 6M24 disposals & other Footfall evolution(2) Tenant sales evolution OCR evolution 6M24 11.5% 6M24 vs 6M23 +3.3% 6M24 vs 6M23 +5.0% FY23 11.7% FY22 11.8% 19 (1) Portfolio
Slide 20: Shopping centers | Occupancy and leasing
Shopping centers | GRI bridge and breakdown VIRTUALLY FULL OCCUPANCY (96.0%) Release spread # contracts Tenants All portfolio +6.4% 88 X- M A D R ID Contracted sqm Total 30,899 20
Slide 21: Valuation and debt position
_ VALUATION POSITION | —— ie waa
Slide 22: Valuation and debt position | GAV summary
Valuation and debt position | GAV summary PORTFOLIO YIELDS OVERALL ABOVE 5% Passing yield 4.8% 5.6% 6.2% 5.2% 11,375 10,699 6,198 GAV TOTAL with minority stakes (€ million) Shopping centers 2,004 Minority stakes Data Centers 1,445 Logistics Offices Other(1) TOTAL 609 676 444 (1) Other includes WIP,
Slide 23: Valuation and debt position | GAV drivers
Valuation and debt position | GAV drivers 12 BPS EXPANSION DURING THE SEMESTER ACROSS THE PORTFOLIO WITH DCs COMPENSATING EROSION +13.3% +0.0% GAV MERLIN LIKE-FOR-LIKE (0.4%) (0.6%) (0.3%) average(2) EVOLUTION(1) Offices Logistics Shopping centers Data Centers +14 +12 bps +11 MERLIN average YIELD +7
Slide 24: Sound financial structure
Valuation and debt position | Sound financial structure 30/06/2024 31/12/2023 Net debt € 4,157m € 4,050m LTV 35.6% 35.0% Average cost (spot) 2.49% (2.77%) 2.38% (2.71%) Fixed rate debt 97.2% 99.7% Average maturity (years) 4.8 5.1 Liquidity(1) (€ million) 1,572 1,309 Rating Outlook BBB+ Stable Baa2 P
Slide 25: Sound financial structure: debt maturities
2 725 302 2 600 800 100 500 Valuation and debt position | Sound financial structure 600 500 187 17 2025 REFINANCING ALREADY TACKLED, DEMONSTRATING ONCE 300 AGAIN A PRO-ACTIVE LIABILITY MANAGEMENT 22 2 2 170 22 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 871 (€ million) Refinanced 71 Unsec
Slide 26: Logistics Best Plan
LOGISTICS BEST PLAN
Slide 27: Short term: commercialization & pending capex
Logistics Best Plan | Short term: commercialization & pending capex SHORT TERM 33k sqm pre-let 73k sqm agreed HoT 57k sqm under commercialization Cabanillas Park II 60k sqm To be delivered by San Fernando III 11k sqm 2H25 32k sqm Total remaining investment Lisboa Park 33k sqm Valencia-Bétera 25k sqm
Slide 28: Mid & long term: commercialization & pending capex
Logistics Best Plan | Mid & long term: commercialization & pending capex 349k sqm Mid & long term pipeline w/106k sqm with agreed HoT Cabanillas Park II 55k sqm Azuqueca III 55k sqm Pending Capex San Fernando III 57k sqm € 175m Lisboa Park 102k sqm Valencia-Bétera 70k sqm Expected stabilized GRI € 1
Slide 29: Digital Infrastructure Plan (MEGA)
DIGITAL INFRASTRUCTURE PLAN (MEGA)
Slide 30: Overview of developments
Digital Infrastructure Plan | Overview of developments 260 MW DC CAPACITY WITH POWER IN SPAIN AND PORTUGAL Phase I Phase II 60 MW 200 MW operating DC Development DC 24 MW + 94 MW Bilbao-Arasur 16 MW + 6 MW Barcelona-PLZF Biggest DC campus in Spain In operation In operation / Under development 20 MW
Slide 31: Phase I overview
Digital Infrastructure Plan | Phase I overview INITIAL DATA CENTER PHASE DEVELOPED ACROSS THREE SITES AND 90% BOOKED BY 1H24 Biggest DC campus in Spain Barcelona - PLZF Bilbao - Arasur Madrid - Getafe In operation In operation / Under development In operation IT capacity 16 MW 24 MW 20 MW Electricit
Slide 32: Phase I (60 MW): Roll-out highlights
Digital Infrastructure Plan | Phase I (60 MW): Roll-out highlights INVESTMENT AND STABILIZED GRI ALIGNED WITH PREVIOUS GUIDANCE, DESPITE DEPLOYMENT DELAYS € 9.4m/MW €m 44 565 75 14.4% >10% 97 Stabilized Stabilized Gross YoC(2) Net YoC(2) 55 294(1) ~70% 90% CAPEX Stabilized NOI Booked Margin Invested
Slide 33: Phase II: Bilbao-Arasur extension (94 MW)
Digital Infrastructure Plan | Phase II (200 MW): Bilbao-Arasur extension (94 MW) MERLIN’S DC CAMPUS IN THE NORTH OF SPAIN, WITH 118 MW IT FOR NOW Substation Existing 24 MW IT BIO03-ARA Phase I (BIO03-ARA) Future BIO02-ARA 94 MW IT Phase II (BIO02-ARA + BIO01-ARA) BIO01-ARA 33
Slide 34: Phase II: Lisbon-DC campus (100 MW)
Digital Infrastructure Plan | Phase II (200 MW): Lisbon-DC campus (100 MW) LARGEST DATA CENTER CAMPUS IN PORTUGAL WITH 100MW FOR NOW 100 MW IT 34
Slide 35: Phase II overview
Digital Infrastructure Plan | Phase II overview Biggest DC campus in Spain Biggest DC campus in Portugal Barcelona - PLZF Bilbao - Arasur Lisbon-VFX In operation In operation / Under development Licensed DC development IT capacity 6 MW 94 MW 100 MW (Repowering) Power Granted 15 MW 140 MW 250 MW • BI
Slide 36: Phase II (200 MW) roll-out highlights
Digital Infrastructure Plan | Phase II (200 MW) roll-out highlights TIME-TO-MARKET IS THE KEY DRIVER FOR PHASE II Fully Fully granted Construction tendering Beginning of works First rents licensed(1) power ongoing expected in 4Q24 expected in 2027 €m 397 6 2,106 886 14.2% >10% Stabilized GRI Stabili
Slide 37: Clear and attractive growth strategy
Digital Infrastructure Plan | Clear and attractive growth strategy HIGHLY VISIBLE NEAR-TERM CAPACITY AND SIZEABLE IDENTIFIED PIPELINE TO SUSTAIN FUTURE GROWTH Snapshot of MERLIN’s Data Center plan Installed Capacity, MW 380 Identified Future Pipeline with power Current focus 200 Phase II 60 Developm
Slide 38: Long term future pipeline: Bilbao-Arasur extension
Digital Infrastructure Plan | Long term future pipeline: Bilbao-Arasur extension 180MW ADDITIONAL IT CAPACITY THROUGH EXTENSION IN ADJACENT PLOTS OWNED BY MERLIN… 1.10 Ca 2 Pi p . el in 18 e 0 180 MW M IT DC 4.1 4.2 4.3 W 5.1 IT 7.b Phase I & II Arasur Pipeline 38
Slide 39: Long term pipeline: Lisbon-DC Campus repowering and extension
Digital Infrastructure Plan | Long term future pipeline: Lisbon-DC Campus repowering opportunity and extension …80MW REPOWERING PLUS 120MW EXTENSION IN ADJACENT PLOT OWNED BY MERLIN +80 MW IT +120 MW IT repowering extension in of Lisbon DC adjacent plot Campus 39
Slide 40: Closing Remarks & Outlook
CLOSING REMARKS & OUTLOOK
Slide 41: Closing remarks & Outlook
Closing remarks & Outlook | Operations • Strong performance in all key financial and operating metrics (LfL rental growth, occupancy, release spread and FFO generation) • Healthy occupancy levels in all three asset classes with offices performing very solidly and virtual full occupancy in logistics
Slide 42: Contact details
Paseo de la Castellana, 257 28046 Madrid +34 91 769 19 00 info@merlinprop.com www.merlinproperties.com
MERLIN Properties SOCIMI — 6M 2024 Earnings Presentation on 6ix