Covivio Sa · EURONEXT:COV
Covivio Sa — Debt Investor Presentation (May 2022)
50 slides from Covivio Sa's debt investor presentation, May 2022
Slide 1: Implementation of a 100% Green Financing Program
Build sustainable relationships and well-being Milan – The Sign IMPLEMENTATION OF A 100% Madrid – Barcelo Torre GREEN FINANCING PROGRAM Paris La Défense – CB 21 Berlin – Uhland
Slide 2: Executive Summary
EXECUTIVE SUMMARY New AHEAD OF ITS ESG OBJECTIVES IN 2021, COVIVIO INCREASED ITS AMBITIONS WITH A NEW CARBON TRAJECTORY - 40% Carbon CO2 Emissions by 2030 vs 2010 on scopes 1, 2 & 3 Trajectory Portfolio PIONNEER OF GREEN FINANCINGS ISSUED IN 2016, WITH A 1ST GREEN BOND 91% bearing a green certificat
Slide 3: ESG STRATEGY: AT THE HEART OF COVIVIO’S DEVELOPMENT COVIVIO’S GREEN BOND FRAMEWORK
I. ESG STRATEGY: AT THE HEART OF COVIVIO’S DEVELOPMENT 4 II. RATIONALE OF THE 100% GREEN BONDS STRUCTURE 15 III. COVIVIO’S GREEN BOND FRAMEWORK 18 IV. FOCUS ON THE CONSENT SOLICITATION PROCESS 27 APPENDIX 31 3
Slide 4: 1. ESG Strategy: At the Heart of Covivio's Development
1. ESG STRATEGY: AT THE HEART OF COVIVIO’S DEVELOPMENT Noeme – Bordeaux 4
Slide 5: ESG – Recognized Leader in Real Estate
ESG – RECOGNIZED LEADER IN REAL ESTATE OUTSTANDING RATINGS IMPROVING YEAR AFTER YEAR Global +5pts Sector Leader 90/100 VS 2020 85/100 REIT Sector 8.3 -0.2pts 8.5 Lower grade = VS 2020 #6 Negligible risk Lower risk vs. AAA 2020 AA Sector vs. Leader 73/100 2020 71/100 Sector Leader 83/100 5
Slide 6: Our Purpose: Build Sustainable Relationships & Well-being
OUR PURPOSE: BUILD SUSTAINABLE RELATIONSHIPS & WELL- BEING 1 2 3 4 WELL-BEING HIGH SUSTAINABLE DEVELOPING OUR OF OUR GOVERNANCE BUILDINGS TALENTS END-USERS STANDARDS THAIS LEVALLOIS, 5,600 m² 6
Slide 7: Sustainable Buildings
SUSTAINABLE BUILDINGS A SECTOR AT THE HEART OF ENERGY TRANSITION Buildings generate nearly 1 40% of annual CO emissions 2 CONSTRUCTION Our responsibility is strong as we have 2 the power and the means to foster carbon reduction across the value chain ACCOUNTS FOR >50% Thus, we decided since 2018 to
Slide 8: Sustainable Buildings
SUSTAINABLE BUILDINGS NEW TRAJECTORY ANNOUNCED IN 2021 AHEAD OF OUR CARBON TRAJECTORY (Scopes 1, 2 and 3) Decrease by 63% our In Carbon intensity (kgCO2 / m² / year) NET ZERO emissions vs. 2015 80 BY 2030 Compensate the remaining SCOPES 1 & 2 part of our emissions 70 TARGET ON SCOPE 3 Build in a mor
Slide 9: Sustainable Buildings: Strategic Priorities to Reach Our Carbon Ambitions
SUSTAINABLE BUILDINGS 5 STRATEGIC PRIORITIES TO REACH OUR CARBON AMBITIONS Activating the decrease in carbon emissions >50% of our new development projects are existing Favor refurbishment & buildings restructuration, in line with our ambition of net zero fight urban sprawling artificialization Most
Slide 10: Environment – Greening the Portfolio
ENVIRONMENT – GREENING THE PORTFOLIO OUTSTANDING ACHIEVEMENTS IN TERMS OF CERTIFICATIONS Share of Green Portfolio1 Focus on offices (57% of the portfolio): 88% certified green 100% Split of the office certifications 91% 88% 57% 84% 36% Outstanding Good or below 21% 31% 54% 2015 2021 48% 45% % of cer
Slide 11: Committed to All Stakeholders
COMMITTED TO ALL STAKEHOLDERS BEST PARTNER FOR OUR TENANTS LAUNCH OF COVIVIO FOUNDATION €1.7M TO BE GRANTED WITHIN 5 YEARS HIGH OFFICES TENANTS’ SATISFACTION LEVEL 89% satisfied or very satisfied1 DEDICATED TO DEVELOP 12 ASSOCIATIONS ATTRACTING 2021 BLUE CHIP LETTINGS COMPANIES ACCOMPANYING 2021 RES
Slide 12: Well-being of Our End-users
WELL-BEING OF OUR END-USERS Fairest GENERATE WELL-BEING Landlord award 100% IN THE FOCUS MONEY SURVEY 2021 #1 of our new office developments projects with a well-being Independent survey updated every year certification among 26 German residential companies, including ~1,400 tenants surveyed OFFER M
Slide 13: Developing Our Talents
DEVELOPING OUR TALENTS Independent survey carried out every 2 years by Kantar Ex-Aequo 83% 8% 44% mentorship program Employee satisfaction Average turnover over the last 5 Women in years management position Among the lowest in our industry Leadership program European 95% >80% 42% Graduate program Op
Slide 14: High Governance Standards
HIGH GOVERNANCE STANDARDS Covéa (since 2003) Separate chairman & CEO 7% Best practices board Crédit Agricole Assurances composition (since 2005) 40% women members (vs. 10% in 2011) Free-float 8% 49% 60% independent members (vs. 40% in 2011) 94% ACM (since 2003) 9% Strong experience with diversity of
Slide 15: 2. Rationale of the 100% Green Bonds Structure
2. RATIONALE OF THE 100% GREEN BONDS STRUCTURE Noeme – Bordeaux 15
Slide 16: Integrate Covivio's ESG Dynamic into Covivio's Financing Structure
INTEGRATE COVIVIO’S ESG DYNAMIC INTO COVIVIO’S FINANCING STRUCTURE Pioneer of Sustainable Finance with ESG policy included through its financing activities with three issuances of Green Bonds in 2016, 2019 and 2021 (representing an amount of c. 39% of Sustainable Bonds among the c. €2.8bn total outs
Slide 17: Ambitiousness of This Methodology
AMBITIOUSNESS OF THIS METHODOLOGY COVIVIO’S AMBITION If the bondholders decide to positively vote during the General Meetings, A fully integrated approach On Bonds all of Covivio’s conventional bond will be requalified as with 100% of Bond Financing GENERAL portfolio Green Bond. In addition, all fut
Slide 18: 3. Covivio's Green Bond Framework
3. COVIVIO’S GREEN BOND FRAMEWORK Noeme – Bordeaux 18
Slide 19: Overview of Covivio's Green Bond Framework: Use of Proceeds
OVERVIEW OF COVIVIO’S GREEN BOND FRAMEWORK 1 USE OF PROCEEDS ➢ Proceeds will be used to finance and/or refinance Eligible Green Portfolio that comprises Eligible Green assets, capital and selected operational expenditures, and investments (see next slides for details of the criteria) ➢ Eligible asse
Slide 20: Overview of Covivio's Green Bond Framework: Management of Proceeds
OVERVIEW OF COVIVIO’S GREEN BOND FRAMEWORK 3 MANAGEMENT OF PROCEEDS ➢ An amount equal to the proceeds from Covivio Green bonds issued under this Framework will be earmarked for allocation to the Eligible Green Portfolio as validated by the GBC. ➢ Covivio commits on a best effort basis to reach full
Slide 21: Overview of Covivio's Eligibility Criteria
OVERVIEW OF COVIVIO’S ELIGIBILITY CRITERIA CATEGORIES ELIGIBLE CRITERIA UN SDGs Green Existing buildings and New buildings – see next slide Buildings Acquisition, installation, maintenance and repair of on-site renewable energy equipment, this category includes: Renewable •Solar photovoltaic systems
Slide 22: Focus on the Green Building Eligibility Criteria
FOCUS ON THE GREEN BUILDING ELIGILIBITY CRITERIA AMBITIOUS CRITERIA FOR ELIGIBLE ASSETS Existing Buildings New Buildings Existing Buildings that received at least one of the following certifications: New Buildings that received at least one of the following certifications*: BREEAM certification leve
Slide 23: Second-Party Opinion
SECOND-PARTY OPINION MOODY’S ESG HAS PROVIDED A SECOND-PARTY OPINION ON COVIVIO’S FRAMEWORK “Moody’s ESG Solutions considers that the contemplated framework is coherent with Covivio’s strategic sustainability priorities and sector Issuer issues and that it contributes to achieving the Issuer’s susta
Slide 24: Covivio's Green Framework: Contribution to EU Environmental Objectives and UN SDGs
COVIVIO’S GREEN FRAMEWORK: CONTRIBUTION TO EU ENVIRONEMENTAL OBJECTIVES AND UN SDGS Covivio’s Green Bond Framework contribution to EU Covivio’s Green Bond Framwork contribution to Sustainable environemental objectives Development Goals (SDGs) Covivio will contribute, where relevant and possible, to
Slide 25: Eligible Portfolio: €4.7bn of Offices
ELIGIBLE PORTFOLIO: €4.7BN OF OFFICES1 29% 36% Platinum & €1,7Bn under New Financing 20% Paris 18% Milan development Outstanding 63% 6% Berlin Excellent 46 buildings & Gold 15% Major Regional 8% Very Good 41% Greater Paris Cities €3,0Bn or top 15% of the 64% Core national building stock Refinancing
Slide 26: Green Bond Expected Allocation
GREEN BOND EXPECTED ALLOCATION ▪ Covivio has €2.8 Bn in outstanding bonds ▪ Covivio’s current Eligible Green Portfolio comprises €4.7 Bn of Covivio’s assets can be categorised as eligible under its Sustainable Bond Framework as of 31st December 2021. Net of dedicated financings, the value amounts to
Slide 27: 4. Focus on the Consent Solicitation
4. FOCUS ON THE CONSENT SOLICITATION Noeme – Bordeaux 27
Slide 28: Summary and Consent Solicitation Overview
SUMMARY AND CONSENT SOLICITATION OVERVIEW Overview: ▪ Covivio announced a Consent Solicitation on its current EUR conventional senior notes to approve the requalification into Green Bonds ▪ The Group intends to allocate an amount equivalent to the proceeds of the target notes to the financing or the
Slide 29: Target Bonds
TARGET BONDS Governing O/S Quorum at First Required Issuer ISINs Maturity CCY Coupon Law Amount (M) Meeting Majority 20% of the principal 2/3 majority of the FR0013262698 June-27 EUR 595 1.500% amount of the Notes votes cast Covivio French 20% of the principal 2/3 majority of the FR0013519279 June-3
Slide 30: Documents and Contacts for the Consent Process
DOCUMENTS AND CONTACTS FOR THE CONSENT PROCESS Documents available to investors: ❑ Each Notice relating to the Meetings (including any adjourned meeting ❑ Independent Auditors Report from EY on fund allocation, dated 18 May or any Meeting on Second or Third Call) 2022 ❑ Sustainable Bond Framework da
Slide 31: Appendix
APPENDIX COVIVIO
Slide 32: Eligible Assets Examples
ELIGIBLE ASSETS EXAMPLES COVIVIO
Slide 33: Eligible Assets Examples: Assets in France
ELIGIBLE ASSETS EXAMPLES ASSETS IN FRANCE Silex² - 31,000m² Flow - 22,500m² Lyon CBD at 200m from Part Dieu Montrouge – Greater Paris Station Delivered in 2019 Delivered in 2021 100% occupancy (EDVANCE) 92% occupancy 2,400m² of green areas (Solvay, ArchiMed, Wellio) High ceillings and 20m depth buil
Slide 34: Eligible Assets Examples: Assets in Italy
ELIGIBLE ASSETS EXAMPLES ASSETS IN ITALY The Sign D – 13,000m² Milan Symbiosis GH – 38,000m² Delivery in 2024 Milan 100% occupancy (L’Oréal) Delivery in 2024 LEED Platinium, WELL 100% occupancy (Moncler) Platinium, Wiredscore LEED Platinium, WELL Air Quality, thermal comfort, Natural Easy access to
Slide 35: Eligible Assets Examples: Assets in Germany
ELIGIBLE ASSETS EXAMPLES ASSETS IN GERMANY FAC - 46,000m² Frankfurt Airport Center Own railway station Strongly connected to city and business district LEED Gold AlexanderPlatz - 60,000m² Berlin CBD Delivery in 2025 Mixed use project In Berlin’s Mitte disctrict 55% Covivio – 45% insurance companies
Slide 36: List of Eligible Assets
LIST OF ELIGIBLE ASSETS ASSETS IN FRANCE ASSETS IN ITALY PARIS MILAN THE LINE PARIS 8TH CORSO ITALIA MILAN STEEL PARIS 16TH DUCA D'AOSTA MILAN GOBELINS PARIS 5TH MONTE TITANO MILAN LITTRE PARIS 6TH JEAN GOUJON PARIS 8TH SYMBIOIS SCHOOL MILAN SAINT LAZARE PARIS 8TH SYMBIOSIS AB MILAN ANJOU PARIS 8TH
Slide 37: Credit Update
CREDIT UPDATE COVIVIO
Slide 38: Solid Fundamentals
SOLID FUNDAMENTALS 1 Relying on diversification and markets with sound fundamentals SOLID ✓ Office: a confirmed need for corporates BUSINESS MODEL ✓ Residential: structural lack of offer ✓ Hotels: recovery is starting 2 ✓ Offices: increasing lettings, increasing indexation GOOD RENTAL GROWTH ✓ Resid
Slide 39: Covivio: €18bn Diversified Portfolio
COVIVIO: €18BN DIVERSIFIED PORTFOLIO WITH BEST-IN-CLASS PLATFORMS IN EACH ASSET CLASS + €6.7bn PORTFOLIO AS OF DEC 31ST, 2021 in 6 years 45% GERMANY LTV €17.7bn FRANCE 40.6% (GS) 38.1% + €3bn €17.7bn €11bn + €2bn (€26.7bn 100%) (GS) + €0.6bn vs 2020 39% - €6bn + €7bn LTV OTHERS IN ITALY EUROPE 15.7%
Slide 40: Offices – Dynamic Letting Activity in Q1 2022
OFFICES – DYNAMIC LETTING ACTIVITY FOR COVIVIO IN Q1 2022 36,100 M² LET OR PRE-LET 32 B - Boulogne La Défense – CB21 18,500 M² PRE-LETTINGS Paris - Stream Building Paris - Anjou 92.4% 17,600 M² Total Offices occupancy NEW LETTINGS +0.2pp vs end-2021 Orly - Belaia Milan – Symbiosis D 40
Slide 41: Success of Our Development Pipeline in Q1 2022
SUCCESS OF OUR DEVELOPMENT PIPELINE IN Q1 2022 PARIS – ANJOU: ANOTHER SUCCESS OF OUR STREAM BUILDING: ORANGE LANDBANKS IN PARIS MIXED-USE PROJECT IN THE CITY CENTER OF PARIS 100% Pre-let to a TOP luxury firm ✓ Offices Space 100% pre-let to a Top Tech firm in Q1 2022 in Q1 2022 ✓ Long-stay hotel 100%
Slide 42: Hotels – Acceleration of Recovery in Q1 2022
HOTELS - ACCELERATION OF RECOVERY IN Q1 2022… REVPAR VS 2019 : RECOVERY ACCELERATING… … AND STRONG PRICING POWER WITH AVERAGE PRICES(1) SOMETIMES BEATING 2019 LEVELS Omicron wave +2% -3% -15% +3% -29% +12% = -22% France UK Europe Germany Sources: MKG, STR, Morgan Stanley research 42 (1) Last 28 Days
Slide 43: German Residential – Sustained Growth
GERMAN RESIDENTIAL – SUSTAINED GROWTH 41% due to Reletting HAMBURG + 2.0% LfL +2.9% 36% due to Indexation BERLIN + 2.6% LfL Like-for-like 33% due to Modernizations growth in Q1 ‘22 NRW + 3.6% LfL (10)% of Vacancy effect linked to future DRESDEN & LEIPZIG privatizations + 2.8% LfL 99.0% Occupancy 43
Slide 44: Acceleration of Like-for-Like Rental Growth
ACCELERATION OF LIKE-FOR-LIKE RENTAL GROWTH OFFICES HOTELS RESIDENTIAL Q1 2021 H1 2021 9M 2021 FY 2021 Q1 2022 92.6% +51% 2021 Q1 2022 2.5% +2.9% 92.4% 1.5% 92.4% 92.2% +3.5% +2.9% LfL Rents LfL Rents 92.0% Occupancy Excluding one-off effect of 0.5% Mietendeckel cancellation 91.8% Q1 2021 H1 2021 (+
Slide 45: Strong Rental Growth Performance in Q1 2022
STRONG RENTAL GROWTH PERFORMANCE IN Q1 2022 Average Q1 2022, €million Revenues Revenues % change Occupancy rate % change lease term Group share Q1 2021 Q1 2022 like-for-like % firm, in years France Offices 49.3 46.6 -5.5% +1.7% 93.6% 4.4 Italy Offices 28.9 27.8 -3.6% +4.1% 96.9% 7.4 Germany Offices
Slide 46: Adjusted EPRA Earnings 2021 / €410.5 Million
ADJUSTED EPRA EARNINGS 2021 / €410.5 MILLION Change Change €million – Group share 2020 2021 €m % Adjusted Epra Earnings Net rental income 539.0 530.7 -8.3 -1.5% +7% vs 2020 EBITDA from hotel operating activities & coworking 9.0 17.6 +8.6 +95.6% Income from other activities (incl. property developmen
Slide 47: +3.9% LFL Value Growth in 2021 Underpinning Our Strategy
+3.9% LFL VALUE GROWTH IN 2021 UNDERPINNING OUR STRATEGY Development + €100m OFFICES +1% 21% of offices portfolio 57% Like-for-like Manage-to-Core 15% - €55m €10.1bn Rest of the portfolio + €39m 64% RESIDENTIAL Berlin +11% / €3,368/m² 28% +14% NRW Dresden & Leipzig +18% / €1,940/m² +12% / €2,418/m²
Slide 48: 39% LTV, Reduced by -2 pts in 2021
39% LTV, REDUCED BY -2 PTS IN 2021 Secured debt profile -2pts LTV 39.1% yoy Covenant 60% (42% bank LTV 2021) Covivio Bonds 39% Corporate credit facilities 16% Immobilien 20% Covivio 65% LOW COST OF DEBT -9 bps 1.20% yoy Investor mortgages facilities 3% Bank mortgage loans 42% Covivio Hotels 15% Debt
Slide 49: Disclaimer
DISCLAIMER This document (the “ Presentation”) may contain information, opinions and certain forward looking statements that reflect Covivio's management's current views with respect to future events and financial and operational performance of the Group. These forward looking statements are based o
Slide 50: Contact
CONTACT Paul Arkwright Quentin Drumare Tel.: +33 1 58 97 51 85 Tel.: +33 1 58 97 51 94 paul.arkwright@covivio.fr quentin.drumare@covivio.fr Paris 30, avenue Kléber 75116 Paris Tel.: +33 1 58 97 50 00 www.covivio.eu 50