Warehouses De Pauw SA · EURONEXT:WDP
Warehouses De Pauw SA — WDP Conference Bucharest 2018
37 slides from Warehouses De Pauw SA's conference presentation, Oct 4, 2018
Slide 1: EIB's views on prospects for private sector development in Romania
EIB’s views on prospects for private sector development in Romania with a focus on the warehouse infrastructure L. Tassan Zanin (EIB Resident Representative in Romania), R. Pal (Economist, Economics Department), P. Vanhoudt (Economist, Projects Directorate) Disclosure: The information included in th
Slide 2: Today's take aways
Today’s take aways • Part 1 – The EIB: what it does and how it works. A snapshot of the EIB activities in Romania. • Part 2 - Romania: a macro-economic overview • Part 3 - Logistics warehouses in Romania: logic for EIB co-financing Corporate Presentation 2017 2 04/10/2018
Slide 3: The EIB: the EU bank
The EIB: the EU bank ‣ Provides long term finance and expertise for sound and sustainable investment projects ‣ Natural financing partner for the EU institutions since 1958 ‣ Around 90% of lending is within the EU ‣ Shareholders: 28 EU Member States Investing in Europe’s growth 3 04/10/2018
Slide 4: The EIB at a glance
The EIB at a glance ‣ Largest multilateral lender and borrower in the world ‣ We raise our funds on the international capital markets ‣ We pass on favourable borrowing conditions to clients ‣ Some 450 projects each year in over 160 countries ‣ Headquartered in Luxembourg with 40 local offices ‣ Arou
Slide 5: 60th Anniversary
60th Anniversary EUR EUR 162 11903 1 100 billion 3 000 billion countries operations disbursed investment mobilised 1958 2018 TREATY OF ROME 60th ANNIVERSARY 5
Slide 6: EIB Group results 2017
EIB Group results 2017 EUR Innovation Environment Infrastructure SMEs 78.2 bn EUR EUR EUR EUR 13.8bn 16.7bn 18bn 29.6bn 6
Slide 7: EIB Group impact
EIB Group impact 10,924 MW 572,324 Improved Safer drinking 3.9 million 7.44 million of power created families healthcare water for jobs sustained new & upgraded (99.6% from in EIB-financed services for 23 million in 285,800 high speed digital renewables) affordable social 45.7 million people firms c
Slide 8: EIB products
EIB products We help catalyse investments: attractive funding for long-term growth Lending Blending Advising Counter-cyclical role Vast majority of our We blend EU with EIB Lack of finance is only Addressing market financing is done funds to enhance our one barrier to access to needs by acting as a
Slide 9: EIB project cycle
EIB project cycle We support sound and sustainable projects Eligibility Check and Art19 procedure with the EC • Financial • Economic Step 7 Step 2 • Social Step 1 Proposal Repayment Appraisal • Environmental • Technical assessment EIB project Step 6 Monitoring cycle Step 3 Approval • EIB Management
Slide 10: EUR 13bn EIB lending in Romania since 1992
EUR 13bn EIB lending in Romania since 1992 Support to investment projects: Water, • Addressing regional disparities sewerage, solid waste, urban • Strengthening competitiveness development… • Improving people’s living Transport 43% standards Telecomm 2% EIB operations in Romania cover all major econ
Slide 11: Substantial increase of EIB lending in Romania in 2017
Substantial increase of EIB lending in Romania in 2017 • EIB signed new loans totalling EUR 1.32bn 27% increase compared to 2016 • EIF committed EUR 551m in 21 operations • Total result of EIB Group (EIB + EIF) reached EUR 1.87bn, representing 1.04% of Romanian GDP 5th position among EU Member Sta
Slide 12: Financing of EIB Group in Romania in 2017
Financing of EIB Group in Romania in 2017 Financing under the Investment Plan for Europe ‣ EUR 15m to support the private healthcare provider Regina Maria in the upgrading and expansion of its network of facilities outside Bucharest ‣ EUR 7.5m to GreenFiber International SA to strengthen its waste c
Slide 13: Financing of EIB Group in Romania in 2017
Financing of EIB Group in Romania in 2017 Fostering urban development ‣ EUR 21m to the Municipality of Oradea to finance improvements of its urban infrastructure ‣ EUR 22m for the second phase of the refurbishment programme covering multi-family housing in the Bucharest municipality of Sector 6 Supp
Slide 14: Macroeconomic Overview and Investment in Romania
Macroeconomic Overview and Investment in Romania Rozalia Pal EIB Economics Department Bucharest October 03, 2018 14 04/10/2018
Slide 15: GDP growth – a closer look
GDP growth – a closer look GDP growth components Potential and Actual GDP Contribution to the annual percentage change Annual percentage change Note: Forecast values for 2018 and 2019. Source: Econ calculations, EC, Eurostat Source: Econ calculations, Eurostat European Investment Bank Group 15 04/10
Slide 16: Some challenges ahead
Some challenges ahead Inflation rate Budget deficit Per cent of GDP Annual percentage change Note: Forecast values for 2018 and 2019. Source: Econ calculations, NBR Source: Econ calculations, EC European Investment Bank Group 16 04/10/2018
Slide 17: Real investment activity – a closer look
Real investment activity – a closer look Real investment: private vs. public Investment growth Annual percentage change Per cent of GDP Note: Forecast values for 2017 and 2018. Source: Econ calculations, Eurostat Source: Econ calculations, Eurostat European Investment Bank Group 17 04/10/2018
Slide 18: Transport infrastructure remains key bottleneck
Transport infrastructure remains key bottleneck Infrastructure quality Total EU payments Per cent of total allocated funds, cumulative 7 Better-than-expected infrastructure FI NL 6 FR AT DK PT ES DE LU SE EE GBBE 5 LT SICZ Infrastructure quality IE HRLV HUSK CY PL ITMT GR 4 BG RO 3 2 1 Worse-than-ex
Slide 19: Better EU funds absorption could benefit public investment recovery
Better EU funds absorption could benefit public investment recovery Funds absorption and potential growth ‣ Raising EU funds absorption rate to 95% for the current program period could add one percentage point to potential growth ‣ EU-funded investment can raise quality ‣ Additional public investmen
Slide 20: Continuously increasing FDI stock in Romania
Continuously increasing FDI stock in Romania FDI stock and portfolio investment FDI stock by main economic activities % of total Note: As of Dec 2016, Total economy 70.1 bn Source: Econ calculations, NBR Source: Econ calculations, NBR European Investment Bank Group 20 04/10/2018
Slide 21: What can 12,000 firms tell us about investment trends in Europe?
What can 12,000 firms tell us about investment trends in Europe? EIB investment survey: ‣ 12,500 firms surveyed across EU28 (of which 600 in UK) ‣ NFCs 5+ employees in manufacturing, services, construction & infrastructure sector ‣ Information on: ‣ Firm characteristics and performance ‣ Investment
Slide 22: Cautious private investment, Construction first to increase
Cautious private investment, Construction first to increase Investment cycle Low investment expanding HU High investment expanding HR Firms expecting to increase/decrease investment in 22% LT SK CY DEAT current financial year (net balance,%) 17% PT PL NL SI EE BE LU 12% IT EU CZ Constr DK LV FI SME
Slide 23: Quality of assets needs serious upgrade
Quality of assets needs serious upgrade State-of-the-art machinery and equipment Share of high energy efficiency buildings average share average share 80% 80% 60% 60% 40% 40% 20% 20% 0% 0% ES NL EE HU LU IT HR LV PL AT IE LT PT DE FI SI SE RO SK MT BE DK FR UK BG CZ ES NL EE HU HR LT PT IT AT IE MT
Slide 24: Higher focus on innovation and R&D activity
Higher focus on innovation and R&D activity to improve productivity and growth Innovation activity average share allocated Incremental Leading Developers Active innovators innovators Investment in R&D EU: 7.3% EU: 11.7% EU: 8.6% RO: 6.1% RO: 8.5% US: 7.5% Basic Adopting Inactive EU: 48.5% EU: 23.9%
Slide 25: Replacement is the current priority in Romania
Replacement is the current priority in Romania, just as in EU. Higher Investments in new products expected. Purpose of previous year's investment Future investment priorities share of total investment share of total investment 100% 100% 80% 80% 60% 60% 40% 40% 20% 20% 0% 0% Manufacturing Constructio
Slide 26: Perceived investment gap twice as large for SMEs
Perceived investment gap twice as large for SMEs compared to large firms Perceived investment gap share of firms EU 2016 EU 2017 RO 2016 RO 2017 Manufacturing Construction Services Infrastructure SME Large 0% 20% 40% 60% 80% 100% Invested too much About the right amount Invested too little Don't Kno
Slide 27: Business environment, skilled staff and transport infrastructure need improvements
Business environment, availability of skilled staff and transport infrastructure need improvements Long-term barriers to investment share of responses Demand for product or service Availability of skilled staff Energy costs Access to digital infrastructure Labour market regulations Business regulati
Slide 28: What can public investment do to support firms?
What can public investment do to support firms? Perceived public investment priorities proportion of responses 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% EE GR ES HR HU NL IE LV RO DK FI IT LT LU PL PT SK SI SE AT FR DE MT BE BG UK CY CZ Transport infrastructure Transportation ICT infrastructure En
Slide 29: 72% of Romanian companies rely on internal sources
72% of Romanian companies rely on internal sources, above the EU average (62%) Source of investment finance Dissatisfaction with external finance average proportion share of responses 100% Amount obtained 80% Cost 60% 40% Length of time 20% Collateral 0% Services SME EU 2016 EU 2017 RO 2016 RO 2017
Slide 30: Less happy to rely exclusively on internal finance
Less happy to rely exclusively on internal finance but on average less likely to be finance constrained Finance cross Firms happy to rely exclusively on internal funds IE 29% 24% UK LU MT FI 19% DK HU SE DE AT SI NL LV PL GR ESEU BG 14% PT BE CYMan CZ SME 9% RO IT HR LT Serv FR SK Large EE Constr 4%
Slide 31: Conclusion
Conclusion ‣ Investment grew in 2017 on account of a pickup in private investment, mainly in the construction sector; ‣ Continuously increasing FDI stock. FDI flows increased by almost 50 % in 2016; equity and reinvested earnings increased further in 2017; ‣ Public Investment to strengthen starting
Slide 32: EIB – quod investments in logistics infrastructure?
EIB – quod investments in logistics infrastructure? Patrick VANHOUDT EIB – Project Department Bucharest October 03, 2018 32 04/10/2018
Slide 33: Does the EIB finance real estate investments? What would be the logic?
EIB – does the EIB finance real estate investments? What would be the logic? ‣ EIB: real estate investments are generally not eligible ‣ speculative investments ‣ “economic rent” (no land bank financing) ‣ Exceptionally commercial real estate, notably logistics warehouses, social housing, etc may be
Slide 34: Market failures: 1) convergence
Market failures: 1) convergence ‣ Romania joined the EU on 1st of January 2007 ‣ EIB contacted by WDP in 2009 ‣ At that time: ‣ Highest based agricultural economy; wide-spread poverty ‣ Largely obsolete industrial base ‣ Romania’s wholesale and retail infrastructure least developed in the EU27 ‣ Ser
Slide 35: Market failures: 2) access to finance
Market failures: 2) access to finance ‣ Romania joined the EU on 1st of January 2007 ‣ EIB contacted by WDP in 2009 ‣ At that time: ‣ The crisis significantly squeezed market liquidity and availability of funding ‣ Long-term corporate borrowing opportunities restricted, particularly in the real esta
Slide 36: Externalities
Externalities: ‣ Signalling effects ‣ EIB conditions require ‣ Sound governance principles ‣ Sound environmental standards ‣ Environmental Impact Assessment, Zoning Permit, Valid Building Permit, etc prior to drawing EIB funds • -> Rolling-out of advanced environmental standards • -> Avoidance of re
Slide 37: Conclusion
Conclusion: ‣ Romania: “bumpy economic road” ‣ Decision to increase non-speculative capacity of Class-A warehouses was a sensible thing to do in the context of: ‣ Addressing market failures ‣ Assisting in achieving catch-up growth ‣ Setting advanced environmental standards and trends for class-A war