success in city retail the golden mile...2015/11/12 · herman konings tina debo saskia schatteman...
TRANSCRIPT
The golden mile
Success in city retail
DE BELEGGERSCLUB HEUSDEN Qrf Update H1 2015
ON SCHEDULE
1I Introducing Qrf
2I City Retail because…
3I Acquisition strategy and activities
4I Portfolio management
5I Accomplishments of 1H 2015
6I The share ‘Qrf’
7I Key portfolio statistics
8I Conclusion
1I INTRODUCING QRF
QRF IS A BELGIAN FIXED-CAPITAL REAL ESTATE INVESTMENT TRUST AND LISTED ON EURONEXT BRUSSELS (QRF:BB) AS OF DECEMBER 2013
4
5
QRF WAS FOUNDED IN 2013. IT AROSE FROM A FORMER SUCCESFULL RETAIL FUND THAT WAS MANAGED BY QUARES
Quares stands for Quality Real Estate Services. Quares is a real estate specialist operating in Belgium, the Netherlands, Luxembourg, Germany and France.
Management team
6
ANNELEEN DESMYTER CEO
PREBEN BRUGGEMAN CFO
BERT WEEMAES COO
• Founding Partner of Quares
• Founded CC Company NV, currently Quares Residential Agency, in 2004
• Formerly project developer in corporate real estate for Eurinpro
Retail experience with Quares Retail Fund, Quares Retail Fund 2 and the bond issue for the acquisition of the high street shopping centre Century Center Antwerpen
• Previously active on capital markets operations and M&A transactions in the real estate sector at Bank Degroof
• Prior equity analyst at Bank Degroof covering the listed real estate sector
• Former director at City Mall, a real estate retail developer
• Previously held positions as member of the Board, CFO and Development & Real Estate Director at Decathlon Benelux
Retail experience with k Kortrijk, Les Grands Prés Mons expansion and Shopping Le Côté Verre Namur and the expansion of Decathlon Benelux
With years of experience in Retail Real Estate
7
WE INVEST IN, (RE)DEVELOP AND RENT OUT PRIME RETAIL REAL ESTATE IN THE ‘GOLDEN MILE’ OF BELGIAN CITIES
INVESTORS IN RETAIL REAL ESTATE
2I CITY RETAIL BECAUSE…
… urbanisation
9
KEY DRIVERS:
• Vibrant social & cultural life
• Mobility & destination proximity
• Economic activity & employment
… population growth
10
0,95
1
1,05
1,1
1,15
1,2
1,25
1,3
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Antwerpen Mechelen Beringen
Genk Hasselt Aalst
Dendermonde Gent Sint-Niklaas
Leuven Brugge Kortrijk
Oostende Roeselare Turnhout
Brussels Hoofdstedelijk Gewest
Population growth in the 15 largest flemish cities and brussels Source: Belgian FOD Economie & Studiedienst Vlaamse Regering
… the city shopping experience
11
• An authentic shopping experience
• A healthy mix of fun & run, leisure, food & drinks, …
• A fun combination of types of stores, brands, chains versus local
… city shopping is fun shopping
12 Source: Vlerick, “City Centres become more and more popular”, 2012
36%
45%
51%
56%
30%
43%
0% 10% 20% 30% 40% 50% 60%
50+
35-50 year
18-34 year
woman
man
total
I like to go shopping for fun - % (totally) agrees
… we choose to shop in the city
13
47%
35%
28%
13%
8%
0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50%
the centre of the city (near) where I live
the centre of the city (near) where I work
a shopping centre outside or on the edge of a city
a website where I can order online
an out-of-town store
How many times do you shop with a clear purpose in any of these locations? A clear purpose means that you go shopping because you have planned to buy
something sustainable (shoes, jacket, dvd, …) - % (very) often
Source: Vlerick, “City Centres become more and more popular”, 2012
… supporting government policies
14
• Investment budgets for city retail locations
• City managers
• Government policies promote city retail
… the future and value of omni-channel
15 Source: CBRE Global Investors, 2014
- Webshop, mobile site, store are individual channels
- E-commerce is threat
- No data interaction between channels
- Channels cross, but…
- Generating traffic to store remains first priority
- Few data interaction
- Not store-, but customer-centric view
- Path-to-purchase interchangeable
- Posibilities to perform data-analysis
16
17
3I ACQUISITION STRATEGY & ACTIVITIES
Acquisition strategy: real estate criteria
19
• Quality and accessibility of the assets
• Quality of the tenants and the underlying rental contracts
• Clear focus to adherence to laws and regulations
• Re-rental potential of the property
Asset type - Focus on high quality retail
properties on city locations
Location - Located in high streets that
are dominant for their catchment area
- i.e. the golden mile in catchment areas of > 50,000 consumers
Attractive locations
20
• Streets with high footfall in Belgian cities with catchment area of min. 50,000
• Cities with an active city development and marketing policy
• Support of expansion plans & introduction in Belgian market
• Strong portfolio growth
Golden mile as a preferred location
21
• Must-have location
• Growing rents
• Scarcity
• Solid liquidity
Acquisition strategy: financial criteria
22
• Sustainable contribution to the earnings per share and dividend policy
Investment size - Strong growth ambitions
Leverage ratio - Overall leverage ratio of
maximum 55%
Straight-forward
23
Portfolio with potential
4I PORTFOLIO MANAGEMENT
Active portfolio management
26
Property improvement
Dialogue with stakeholders
Anticipation on retail markets of tomorrow
Creativity team
27
HERMAN KONINGS
TINA DEBO
SASKIA SCHATTEMAN
• Manager of trend and future research bureau Pocket Marketing / nXt.
• VP Product and Design for Kipling
• Member of the board with NMBS
• Former CMO Lead for Microsoft and former Vice President with Telenet.
Advisory group on the marketing and positioning of Qrf in regards to current and future retail, e-commerce and city shopping trends
5I ACCOMPLISHMENTS OF 1H 2015
29
Focus on Belgian inner-city retail properties that are dominant in their catchment area • 8% portfolio growth in 1H 2015 • Resulting in 537 KEUR additional yearly rent • The part of inner-city real estate increases to 75%
Mai
n h
igh
ligh
ts
Diversified in terms of tenants, individual asset size and geographical spread
• Acquisitions in Gent, Oudenaarde, Antwerp and Namur with a nice tenant mix: Esprit, Armand Thiery, Gerry Weber, ...
Sustainability and social responsibility • Establishing sustainable relationships with stakeholders • Being attentive to environmental impact • Supporting young artists which promote the inner-city
1H 2015 Highlights
Active portfolio management • 2 renewals of rental contracts with rental increase • 0 rental contracts ended • Several pop-up stores
Capital increase • Contribution in kind of 2 retail properties located in Antwerp
& Namur • 193,097 new issued shares • Increasing the shareholders’ equity by 4.73 MEUR
Resulting in acquisitions on 4 locations
30
Gent
Oudenaarde
Namur
Antwerpen
Investment value of approx.
11 MEUR
Acquisitions in 1H 2015
31
Date of
transaction
City Street Tenant(s) GLA Contractual
rents on annual
basis
April 21, 2015 Oudenaarde Nederstraat 43-45 Esprit (Jomi
BVBA)
1,228 m² 150 KEUR
May 27, 2015 Gent Lange Munt 61-63 Gerry Weber 638 m² 132 KEUR
June 24, 2015 Namen Rue de Fer 10 Armand Thiery 192 m² 180 KEUR
June 24, 2015 Antwerpen Kammenstraat 34 Dstrezzed 161 m² 75 KEUR
TOTAL 537 KEUR KEU
September 2015: Acquisition Aalst
32
Aalst, Nieuwstraat 29-33
- 7,080 m² GLA
- 33 m’ frontage
- 77 parking lots on roof
Acquisition yield of approx. 5.75%
978 KEUR annual rental income
Investment Value of approx. 17.0 MEUR
6I THE SHARE ‘QRF’
33
Qrf share
34
Evolution of stock price and NAV Key data per share
Per share data (in EUR) 30.06.2015 30.12.2014 30.06.2014
Total number of shares
outstanding 3 466 008 3 272 911 3 272 911
Closing price 25,04 25,90 24,46
Market capitalisation 86 788 840 84 768 395 80 055 403
NAV (IFRS) 22,71 23,13 22,64
Premium to NAV (IFRS) 10,3% 12,0% 8,0%
NAV (EPRA) 23,58 23,87 23,23
Premium to NAV (EPRA) 6,2% 8,5% 5,3%
-
200
400
600
800
1.000
1.200
1.400
1.600
1.800
2.000
20,0
21,0
22,0
23,0
24,0
25,0
26,0
27,0
28,0
29,0
30,0
Volume per dag Stock Price NAV per share (IFRS)
(in EUR) (in KEUR)
Dividend guidance
• Expected gross dividend for FY 2015 of at
least 1,30 EUR
• Gross dividend yield of 5,2% (1)
(1) Based on closing price as of 30 June 2015
Qrf - An interesting investment opportunity
35
CITY RETAIL
2 Focus on high street in prime and regional cities
3 Offering solid risk-return profile 4 Quality of
underlying portfolio
5 Steered by experienced and motivated management team
1 Resilient retail market
Goal: 1,3 EUR Gross Dividend per share (= 0,975 Net per share)
7I KEY PORTFOLIO STATISTICS
Well-spread tenant base
37
FASHION
51%
6%
6%
5%
4%
4%
4%
3%
3%
3%
3% 2% 2% 2%
Sectoral spread (% Contractual rents on annual basis)
Fashion (H&M, Bershka, G-Star, …)
Sport & Leisure (HEMA, Neckerman, Oxygen,Standaard, ..)Interior & Decoration (Casa, Euro Center, …)
Horeca (Panos, Mc'Donalds, …)
Car (Citroën)
Electro & Telecom (Van den Borre, Phone House, …)
Parking
Jewelry (Twice as Nice, ...)
Beautycare (Kruidvat, Hans Anders, …)
Garden & do-it-yourself (Brico, …)
Office articles (Ava papierwaren, …)
Shoes (Torfs, Tamaris, Janelli, …)
Food (Lidl, …)
Varia
Well-spread tenant base
38
FASHION
11,9%
5,4%
4,5%
4,3%
3,7%
3,4%
3,4%
2,4%
2,2%
H&M
Sissy Boy
Citroën
Bershka
Apcoa
Piocheur
Esprit
C&A
Mc DONALD'S
Tenant spread (% Contractual rents on annual basis)
High and stable occupancy rate
39
96,8%
96,0% 96,2%
99,5% 99,7%
99,0%
90%
91%
92%
93%
94%
95%
96%
97%
98%
99%
100%
30/12/2013 30/12/2014 30/06/2015
Occupancy rate (excl. rental guarantees on vacant property) Occupancy rate
Portfolio valuation
40
FASHION
Real estate portfolio (in K EUR) 30.06.2015 30.12.2014 30.12.2013
Fair value of the real estate portfolio 150 228 139 218 114 201
Gross rental surface (in m²) 60 248 58 029 51 730
Gross portfolio yield (incl. rental guarantees on vacant property) 6,1% 6,2% 6,2%
Gross portfolio yield (excl. rental guarantees on vacant property) 6,0% 6,0% 6,1%
Occupancy rate 99,0% 99,7% 99,5%
Occupancy rate (excl. rental guarantees on vacant property) 96,2% 96,0% 96,8%
43%
15%
13%
11%
5%
5%
3% 2% 2% 2%
Geographical spread per province (% Fair Value)
Antwerp
Liège
East Flanders
Limburg
Brussels CapitalRegionFlemish Brabant
Luxembourg
Namur
74%
21%
6%
Geographical spread per region (% Fair Value)
Flanders
Wallonia
Brussels
Evolution of the Fair Value of the portfolio
41
114,2 MEUR
129,4 MEUR
139,2 MEUR
150,2 MEUR
167,0 MEUR
66%
71%
73%
75%
77%
0,0 MEUR
20,0 MEUR
40,0 MEUR
60,0 MEUR
80,0 MEUR
100,0 MEUR
120,0 MEUR
140,0 MEUR
160,0 MEUR
180,0 MEUR
30/12/2013 30/06/2014 30/12/2014 30/06/2015 30/06/2015 + ACQ Aalst
Fair Value % inner-city
8I CONCLUSION: A VALUED PARTNER
Expectations on 2015
43
2 Diversification in regional and main cities in Belgium
3 Straight-forward operating 4 Further growth by acquisitions
5 Sustaining dividend level
1 Focus on Golden Mile
44
QUESTIONS?
THANK YOU