Helios Re Socimi, S.a. · BME:SCHLR
Helios Re Socimi — Lar España Real Estate SOCIMI — Investor Presentation (November 2018)
50 slides from Helios Re Socimi's investor presentation, November 2018
Slide 1: Corporate Presentation
CORPORATE PRESENTATION www.larespana.com The Spanish Retail Specialist November 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 PIMCO Other investors 19.6% 45.6% Focused on creating both sustainable income and strong capital returns for shareholders Manager Grupo Lar Lar España is managed by Grupo Lar, pri
Slide 5: Board of Directors & critical activities
01 Company Description 5 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 Leticia Iglesias Jon Armentia Susana Guerrero Hernán San Pedro Chairman and Independent Independe
Slide 6: Major corporate milestones from 2017 & 2018 YTD
01 Company Description 6 Major corporate milestones from 2017 & 2018 YTD JAN MAR MAY JUL SEP DEC FEB JUN AUG +15.8% Abadía Retail Dividend +19.5% Vidanova Parc Analyst Day Rivas Futura +34% Galaria Asset Park Acquisition Payment Asset Revaluation Credit for Construction Acquisition Asset Retail Park
Slide 7: Portfolio at a glance
01 Company Description 7 Portfolio at a glance 87% of GAV concentrated in retail assets Assets GLA 23 631,448 2 acquisitions in 2018 sqm €1,526 Mn €70 Mn Gross Asset EPRA Annualised Value Net Rent Retail Rest of the portfolio GAV 87% 13% Remaining offices Retail portfolio and Offices unique resident
Slide 8: Investment Strategy focused on retail
01 Company Description 8 Investment Strategy focused on retail Unique shopping centres & retail parks SHOPPING CENTRES & RETAIL PARKS MAIN CHARACTERISTICS Dominant in its Value-creation Core+ catchment areas potential 100% Target levered ownership IRR>12% Unique exposure to real estate retail Resili
Slide 9: The value of a retail platform
01 Company Description 9 The value of a retail platform Main market players by owned GLA, including Lar España has consolidated among the top retail operators in Spain. Now, GLA under development1 the target is to selectively increasing GLA to generate revenue synergies Owned GLA (est.) Avg. ownersh
Slide 10: Strong Transformation + Innovation
01 Company Description 10 Strong Transformation + Innovation Transformation Strategy Digital Innovation Big Data Customer Intelligence Full Market Connectivity Knowledge Webs Seeketing APPS System WIFI Social Media E-Beacons >25k 7% 105 sqm Annualised tenant Rotated area Relettings + New Lettings Ma
Slide 11: External manager: A real estate reference
01 Company Description 11 External manager: A real estate reference Grupo Lar now owns a 10% 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 12: Business Plan Guidance 2018-2021
01 Company Description 12 Business Plan Guidance 2018-2021 Target ▪ 12% Target Annual Return on investments Returns ▪ €403 Mn of divestments From Office, residential and non-core retail assets 31% realized Divestments ▪ >€119 Mn of divestments From all logistics portfolio (100% realized) 100% realiz
Slide 13: Investment Highlights
02 Investment Highlights
Slide 14: Top 10 Value Drivers
02 Investment Highlights 14 Top 10 Value Drivers 10 1 Attractive Dividend Momentum of Real Policy Estate in Spain /Yield Compression 9 2 ANNUALIZED NET RENT NET LTV €70 Mn 31% Optimal Debt Upside from the Retail Management Existing Portfolio CURRENT POTENTIAL ANNUALIZED AVG. COST OF DEBT NET RENT WI
Slide 15: Value Driver 1: Momentum of RE in Spain / Yield Compression
02 Investment Highlights 15 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 16: Value Driver 2: Potential from the Existing Retail Portfolio
02 Investment Highlights 16 Value Driver 2: Potential from the Existing Retail Portfolio +5.6% +c.8% >6% +57% Retail Expected Expected Estimated Rental Topped-Up NIY NIY NIY Increase Potential Future Ongoing Investments Existing Income Development Generating Assets 15 110 4 15 95 6 80 70 Annualised
Slide 17: Value Driver 2: Capex, a tool to create value
02 Investment Highlights 17 Value Driver 2: Capex, a tool to create value Ongoing Refurbishments Est. Capex % Execution Megapark €6.5 Mn 90% executed Phase I Portal de la Marina €3.2 Mn 50% executed As Termas €1.4 Mn 35% executed Gran Vía de Vigo €0.9Mn 50% executed Albacenter Shopping Centre Eloy G
Slide 18: Value Driver 3: Strong operating results
02 Investment Highlights 18 Value Driver 3: Strong operating results Lar España continues outperforming the market, Letting activity despite 4 shopping centres under refurbishment at the core of the strategy Visits 9M 2018 Sales3 9M 2018 +8.0% 41.5 Mn €486.3 Mn RENTAL GROWTH5 Vs 9M 2017 Vs 9M 2017 2
Slide 19: Value Driver 3: Strong operating results
02 Investment Highlights 19 Value Driver 3: Strong operating results All figures refer to 9M 2018 period Active Asset & Tenant Vs 9m 2017 Management LfL Occupancy Rate LfL NOI LfL GRI Incentives reduction to + Growth Growth Growth tenants Smart Capex in Operating +1.5% +4.1% +3.0% 9.7% Assets Total
Slide 20: Value Driver 4: Disruptive projects differentiating among our competitors
02 Investment Highlights 20 Value Driver 4: Innovation Strategy Disruptive projects differentiating among our competitors Succesful shopping centres performance Winning assets in a moment of change and opportunity by Lar España is leading the digital transformation in the Spanish retail sector DIGIT
Slide 21: Value Driver 4: 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 New residential concept €203 Mn in the centre of Madrid Valuation1 79% 90% 44% FY 2016 FY 2017 9M 2018 Most units’ deliveries expected Special dividend before 2018 Year-End announced Avg. Price Plot with 4 façades that features 44
Slide 23: Value Driver 5: Developments – VidaNova Parc
02 Investment Highlights 23 Value Driver 5: Developments – VidaNova Parc VidaNova Parc fully opened in September Tenants impressed by initial sales figures Tenants >170,000 100% sales GLA leased visitors above estimates 1st week 45,773 Sqm €49.0 Mn €61.6 Mn GLA Total Investment Valuation1 +40 €5 Mn
Slide 24: Value Driver 5: Developments – Lagoh
02 Investment Highlights 24 Value Driver 5: Developments – Lagoh Summer Excellent location, 4 km from Seville’s city centre 2019 Opening 8 Inditex 76% Brands signed GLA signed and committed 14 Mn/year c.200 €106.2 Mn Exp. Visits Tenants Valuation1 €151.6 Mn 1.5 Mn inhabitants c.15 Mn Estimated Great
Slide 25: Value Driver 6: Attractive valuation of the existing portfolio 9M 2018
02 Investment Highlights 25 25 Value Driver 6: Attractive valuation of the existing portfolio 9M 2018 € Mn Portfolio Value GAV by asset class 1,538 76 244 1,526 156 1,275 Retail 87% 899 Residential 7% 406 Offices 6% 2014 2015 2016 2017 Acquisitions Divestments Revaluation 30 Sep 2018 2018 2018 2018
Slide 26: Value Driver 7: Asset rotation policy aimed at maximizing returns
02 Investment Highlights 26 Value Driver 7: Asset rotation policy aimed at maximizing returns Business Plan Execution Arturo Soria Sale Egeo Sale Villaverde & Alisal Sale Logistics Portfolio & Galaria Sale Office Building Office Building Retail Parks Cheste Sale Retail Park 5.8% €32.5 Mn €79.3 Mn €3
Slide 27: Value Driver 7: Asset rotation policy aimed at maximizing returns
02 Investment Highlights 27 Value Driver 7: Asset rotation policy aimed at maximizing returns Remaining non-core assets will add value in the coming months OFFICES LAGASCA99 VALUATION1 VALUATION3 €97.5 Mn €203 Mn MARCELO SPÍNOLA ELOY GONZALO JOAN MIRÓ VALUATION1 VALUATION2 VALUATION1 €38.5 Mn €39.4
Slide 28: Value Driver 8: Acquisition pipeline aimed at increasing retail platform
02 Investment Highlights 28 Value Driver 8: Acquisition pipeline aimed at increasing retail platform Current Opportunities €250 Mn of new investments ✓ Large and visible pipeline Last Acquisitions 110k+ including actionable off-market acquisitions with yields in the 6% area Asset Class Aprox. GLA Lo
Slide 29: Value Driver 9: Debt management as a means of value creation
02 Investment Highlights 29 Value Driver 9: Debt management as a means of value creation Debt Structure and Amortization Profile As at 30.09.2018 €140 Mn €467.0 Mn Senior Secured Bond Bank Debt Gross Financial Debt € Mn €607.0 Mn 259.2 239.0 Net LTV Avg. Cost of Debt 140.0 31% 2.27% 88.9 119.2 Fixed
Slide 30: Value Driver 10: Predictable and sustainable dividend distribution policy
02 Investment Highlights 30 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 31: Value Driver 10: Consistent dividend growth per share
02 Investment Highlights 31 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 32: Financial Results 9M 2018
03 Financial Results 9M 2018
Slide 33: Solid company performance in 9M 2018
03 Financial Results 33 Solid company performance in 9M 2018 +12% 21% 11 quarters in Net Profit Developments & €10.76 NAV p.s. outperforming the OPERATING +44% refurbishment revaluation +13% vs 9M 2017 Spanish market RESULTS in Property Operating Result1 since June 2018 in sales & footfall VidaNova
Slide 34: Successful & strong financial key figures delivered in 9M 2018
03 Financial Results 34 Successful & strong financial key figures delivered in 9M 2018 23 631,448 Assets GLA sqm €1,526 Mn +7% €58.6 Mn +2% €1,018 Mn 13.5% GAV vs 9M 2017 GRI vs 9M 2017 EPRA NAV ROE €607.0 Mn 2.27% €60.6 Mn +45% €10.76 8.0% Financial Debt Cost of Debt EBITDA1 vs 9M 2017 EPRA NAV per
Slide 35: Solid retail performance & robust operating results in 9M 2018
03 Financial Results 35 Solid retail performance & robust operating results in 9M 2018 Retail Rest of the portfolio Retail Rest of the portfolio GAV 87% 13% Rental Income 93% 7% Retail yields Operating results Commercial activity +3.0% LfL GRI €5.8 Mn 25,461 sqm 6.5% Negotiated rent Rotated area Pot
Slide 36: Consolidated Income Statement
03 Financial Results 36 Consolidated Income Statement (€ Millions) P&L RECURRING NON-RECURRING Chg% 9M 2018/17 9M 2018 9M 2017 9M 2018 9M 2017 9M 2018 9M 2017 Rental Income 58.6 57.2 58.6 57.2 - - Other Income 3.1 1.6 3.1 1.6 - - Property Operating Expenses (10.3) (9.6) (10.3) (9.6) - - Base Fee (6.
Slide 37: ESG Results
04 ESG Results
Slide 38: ESG - Asset Management & Environment
04 ESG Results 38 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 39: ESG - Corporate Governance
04 ESG Results 39 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 40: Appendix 1
05 Appendix 1
Slide 41: Retail Assets
05 Appendix 1 41 41 Retail Assets Megapark Gran Vía P. Marina El Rosal Lagoh Anec Blau As Termas Abadía Bilbao Vigo Alicante Ponferrada Seville Barcelona Lugo Toledo Development Market Value €217.9 Mn €165.0 Mn €122.5 Mn €109.0 Mn €106.2 Mn1 €95.9 Mn €85.6 Mn €80.9 Mn (Jun 2018) GLA (Sqm) 83,366 41,
Slide 42: Retail Assets
05 Appendix 1 42 42 Retail Assets Rivas Vidanova Parc Albacenter Vistahermosa Madrid Valencia Albacete Alicante Other Assets3 Market Value €65.4 Mn €61.6 Mn1 €57.9 Mn €49.7 Mn €103.0 Mn (Jun 2018) GLA (Sqm) 36,447 45,773 27,890 33,363 44,888 30 Jul ’14 Acquisition Date 6 Feb ´18 3 Aug ’15 16 Jun ’16
Slide 43: Offices and Residential
05 Appendix 1 43 43 Offices and Residential Offices Residential Lagasca99 Market Value Market Value €99.4 Mn1 €203.0 Mn3 (Jun 2018) (Sep 2018) GLA (Sqm) 23,816 GLA (Sqm) 26,203 Acquisition Date NA Acquisition Date 30 Jan ´15 Acquisition Price €51.4 Mn Acquisition Price €50.1 Mn4 EPRA NIY2 0.1% Const
Slide 44: Appendix 2
05 Appendix 2
Slide 45: Highlights of the Investment Management Agreement
05 Appendix 2 45 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 46: External management by Grupo Lar continues to be the optimal strategy
05 Appendix 2 46 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 47: Recognitions
Recognitions
Slide 48: Recognitions
48 Recognitions 2018 EPRA BPR & sBPR Awards Since June 2015: Member of FTSE EPRA/Nareit Global Estate Index First SOCIMI to be awarded with the "EPRA Recognized with the GOLD AWARD” in Financial Reporting for the “EPRA Gold Award” in 4th consecutive year Sustainability Best Practices Sustainability
Slide 49: Disclaimer
49 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 50: Corporate Presentation
Corporate Presentation Follow us: www.larespana.com Lar España Real Estate SOCIMI info@larespana.com Lar España App
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