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Intervest Offices & Warehouses NV
Earnings Release • Nov 8, 2021
3966_10-q_2021-11-08_fa017b3b-695a-4e62-ab7d-02aaf2e0e8d1.pdf
Earnings Release
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INTERIM STATEMENT THIRD QUARTER 2021
PRESS RELEASE Regulated information Embargo until 08.11.2021, 6:00 p.m.
Antwerp, 8 November 2021
Realization of important milestones in strategic growth plan #connect2022 through focus on active rental policy and sustainable value creation via in-house (re)developments, resulting in a solid foundation for the future
Solid financial results
- 〉 EPRA earnings per share amount to € 1,30 over 9M 2021, an increase of 10% compared to the same period last year
- 〉 Increase of the previously communicated expected EPRA earnings per share for 2021 from between € 1,65 and € 1,68 to between € 1,70 and € 1,72
- 〉 Confirmation of the target gross dividend of € 1,53 for 2021 –at the same level as in 2020– meaning a gross dividend yield of 6,5%1
- 〉 Operational margin increased by 3% to 82% compared to the same period last year
Focus on active rental policy results in strong key figures
- 〉 80% of lease agreements with due date in 2021 have been renewed1
- 〉 Stable WALB for the total portfolio of 3,9 years; 4,8 years for logistics
- 〉 An increase in the occupancy rate of the total real estate portfolio by 1% to 94% compared to 31 December 2020
- 〉 An organic growth2 in rental income of 5% as compared to the same period last year
- 〉 Genk Green Logistics attracts a third tenant (Neovia Logistics) for a 10,000 m² warehouse to be built; as a result, almost 20% of the available 250.000 m² is (pre)let; advanced negotiations ongoing for several other units
- 〉 Major rental transactions in the existing logistics portfolio:
- › Two new tenants in Herentals (Biscuiterie Thijs and transport company Van de Poel) following the departure of Nike Europe Holding
- › Lease extension with Vincent Logistics in Herstal
- › Long-term lease with PostNL Pakketten België in Oevel, following the early departure of the previous tenant
Realizations team Nederland
- 〉 The transfer of the first site in Breda via a sale-and-lease-back agreement with Nouwens Transport Breda has been completed
- 〉 In October 2021, an agreement was reached with ASML, tenant of the logistics site in Eindhoven (Silver Forum), to extend the lease until the end of 2023
1 Based on the closing share price as at 30 September 2021, which amounts to € 23,65.
2 This concerns the rental income growth of the existing portfolio, including the completed and leased projects, excluding acquisitions.
Interim statement by the supervisory board for the third quarter of 2021
Antwerp, 8 November 2021 Regulated information Embargo until 08.11.2021, 6:00 p.m.
Investments as a foundation for future value creation
- 〉 Focus in both segments on both future development potential and futureproof modernization of the existing portfolio
- 〉 Increase in fair value of investment properties with € 97 million or 9,5%, as compared to 31 December 2020 through:
- › €32 million investments in sustainable project developments: Herentals Green Logistics, Genk Green Logistics, Greenhouse Collection and Venlo (NL)
- › Positive change in fair value of € 46 million, a combined result of
- › Value increase in logistics portfolio by € 53 million or 8% and
- › Value decrease in office portfolio by € 7 million or 2%
- › For € 14 million acquisition of logistics site in Breda (NL)
- › € 5 million investments in existing portfolio
Solid basis for the future
- 〉 Two real estate segments: logistics real estate (65%) and offices (35%); 45% logistics real estate in the Netherlands
- 〉 Diversified tenants
- 〉 Strong balance sheet
- 〉 Realization of well-considered growth of the real estate portfolio since 2019,
- of which 20% as a result of acquisitions and project developments
- 〉 Future potential increase in value over a period Q4 2021 2025 between € 238 € 281 million through (re)development projects
- 〉 Further optimization of the financing structure:
- › Tightening of the average interest rate to 1,8%
- › No more financing on due date until 2023
- › Increase in average remaining term of the long-term credit lines to 4,3 years compared to 3,8 years at the end of 2020
- 〉 Sufficient investment capacity due to € 120 million unused credit lines
- 〉 Successful #connect2022 strategy lays foundations for the creation of a detailed roadmap to develop the long-term ESG policy
Forecasts are based on current knowledge and assessment of interest rate fluctuations, the strategic growth plan #connect2022 and barring unforeseen circumstances (such as the possible effects of the corona crisis).
Key figures for Q3 2021
REAL ESTATE FINANCIAL MARKET
€ 1,1 billion
Fair value of the portfolio
94%
Occupancy rate: 100% Logistics NL 98% Logistics BE 87% Offices
3,9 years
Average remaining duration of lease agreements (until first expiry date) 4,8 years Logistics 2,6 years offices
7,1%
Gross rental yield for fully leased portfolio 6,0% Logistics 9,3% Offices
41 bp Average yield tightening in logistics real estate
€ 1,30 EPRA earnings per share
€ 23,80 EPRA NTA per share
1,8% Average interest rate of the financings
42,9% Debt ratio
€ 1,53 Intended gross dividend per share
€ 1,70 - € 1,72 Expected EPRA earnings per share 2021
€ 622 million
Market capitalisation
6,5% Gross dividend yield
SUSTAINABILITY
26% of the real estate portfolio at least BREEAM "Very Good"
100% of electricity from sustainable sources
66% of the logistics real estate portfolio with solar panels: 30 MWp
54% of the real estate portfolio equipped with smart meters
TEAM
Comparative key figures
| In thousands € | 30.09.2021 | 31.12.2020 |
|---|---|---|
| Real estate key figures | ||
| Fair value of real estate | 1.114.644 | 1.017.958 |
| Fair value of real estate available for lease | 1.021.338 | 965.796 |
| Gross lease yield on real estate available for lease (in %) | 6,6% | 6,9% |
| Gross lease yield on real estate available for lease at 100% occupancy rate (in %) | 7,1% | 7,4% |
| Average remaining duration of lease contracts (until first expiry date) (in years) | 3,9 | 4,0 |
| Average remaining duration of lease contracts logistics portfolio (until first expiry date) (in years) |
4,8 | 4,7 |
| Average remaining duration of lease contracts offices portfolio (until first expiry date) (in years) |
2,6 | 2,9 |
| Occupancy rate total portfolio (in %) | 94% | 93% |
| Occupancy rate logistics portfolio (in %) | 99% | 96% |
| Occupancy rate logistics portfolio NL (in %) | 100% | 98% |
| Occupancy rate logistics portfolio BE (in %) | 98% | 95% |
| Occupancy rate offices (in %) | 87% | 88% |
| Gross leasable surface area (in thousands of m²) | 1.049 | 1.046 |
| Financial key figures | ||
| EPRA earnings | 33.766 | 40.355 |
| Result on portfolio | 38.301 | 5.387 |
| Changes in fair value of financial assets and liabilities | 1.771 | - 2.311 |
| NET RESULT – GROUP SHARE | 73.838 | 43.431 |
| Number of shares entitled to dividend | 26.300.908 | 25.500.672 |
| Weighted average number of shares | 25.875.874 | 25.164.126 |
| Share price on closing date (in €/share) | 23,65 | 22,55 |
| Net value (fair value) (in €/share) | 22,74 | 21,46 |
| Net value (investment value) (in €/share) | 24,33 | 22,64 |
| Premium with respect to fair net value (in %) | 4% | 5% |
| Market capitalisation (in million €) | 622 | 575 |
| Gross dividend (in €) | 1,53 1 | 1,53 |
| Gross dividend yield (in %) | 6,5% | 6,8% |
| Debt ratio (max. 65%) | 42,9% | 43,0% |
| Average interest rate of the financing (in %) | 1,8% | 2,0% |
| Average duration of long term credit lines (in years) | 4,3 | 3,8 |
| EPRA key figures | ||
| EPRA earnings (€ per share) (Group share) | 1,30 | 1,60 |
| EPRA NTA (in €/share) (new indicator)2 | 23,80 | 22,40 |
| EPRA NRV (in €/share) (new indicator)2 | 25,62 | 24,08 |
| EPRA NDV (in €/share) (new indicator)2 | 22,67 | 21,37 |
| EPRA NIY (Net Initial Yield) (in %) | 5,7% | 5,7% |
| EPRA topped-up NIY (in %) | 5,8% | 5,8% |
| EPRA vacancy rate (in %) | 6,5% | 7,3% |
| EPRA cost ratio (including direct vacancy costs) (in %) | 18,1% | 20,2% |
| EPRA cost ratio (excluding direct vacancy costs) (in %) | 16,7% | 18,7% |
1 This concerns the target gross dividend for 2021.
2 In October 2019, EPRA published the new Best Practice Recommendations for financial disclosures of listed real estate companies. EPRA NAV and EPRA NNNAV are replaced by three new Net Asset Valuation indicators, namely EPRA NRV (Net Reinstatement Value), EPRA NTA (Net Tangible Assets) and EPRA NDV (Net Disposal Value). The EPRA NTA largely matches the "old" EPRA NAV.
Interim statement by the supervisory board for the third quarter of 2021
Antwerp, 8 November 2021 Regulated information Embargo until 08.11.2021, 6:00 p.m.
Contents
| Operational activities in the third quarter of 2021 Leasing activities and occupancy rate Real estate portfolio |
7 8 11 |
|
|---|---|---|
| Projects under construction & development potential | 12 | |
| Sustainability | 17 | |
| Financial results for the first nine months of 2021 | 19 | |
| Analysis of the results | 19 | |
| Financial structure | 22 | |
| EPRA Awards | 23 | |
| Outlook 2021 | 24 | |
| Investments and development potential | 24 | |
| EPRA earnings and gross dividend | 26 | |
| Financial calendar 2021 - 2022 | 27 | |
| Appendices | 28 | |
| Financial states | 28 | |
| Terminology and alternative performance measures third quarter 2021 | 31 |
Alternative performance measures
Alternative performance measures are criteria used by Intervest to measure and monitor its operational performance. The measures are used in this press release, but they are not defined by an Act or in the generally accepted accounting principles (GAAP). The European Securities and Markets Authority (ESMA) issued guidelines which, as of 3 July 2016, apply to the use and explanation of the alternative performance measures. The concepts that Intervest considers to be alternative performance measures are included in a lexicon on the www.intervest.be website, called "Terminology and alternative performance measures". The alternative performance measures are indicated with ★ and provided with a definition, objective and reconciliation as required by the ESMA guidelines. EPRA (European Public Real Estate Association) is an organisation that promotes, helps develop and represents the European listed real estate sector, both in order to boost confidence in the sector and to increase investments in Europe's listed real estate. For more details, please visit www.epra.com.
Interim statement by the supervisory board for the third quarter of 2021
Antwerp, 8 November 2021 Regulated information Embargo until 08.11.2021, 6:00 p.m.
Operational activities in the third quarter of 2021
In the third quarter of 2021, Intervest Offices & Warehouses (hereinafter, "Intervest") continued to focus on sustainable projects under construction, both in Belgium and the Netherlands and in both segments. In addition, the driven and active letting policy with attention to the expectations of (potential) tenants, in both the existing portfolio and in the projects, results in strong KPIs. As such, #TeamIntervest realises important milestones in the strategic growth plan #connect2022 and lays a solid foundation for the future.
| KEY FIGURES* | 30.09.2021 | 31.12.2020 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| LOGISTICS | OFFICES | TOTAL | LOGISTICS | OFFICES | TOTAL | |||||
| Belgium | The Netherlands |
TOTAL logistics |
TOTAL offices |
Belgium | The Netherlands |
TOTAL logistics |
TOTAL offices |
|||
| Fair value of investment properties (in thousands €) |
402.206 | 325.958 | 728.164 | 386.480 | 1.114.644 | 353.405 | 282.897 | 636.302 | 381.656 | 1.017.958 |
| Fair value of real estate available for lease (in thousands €) |
357.600 | 320.548 | 678.148 | 343.190 | 1.021.338 | 336.654 | 280.774 | 617.428 | 348.368 | 965.796 |
| Contractual leases (in thousands €) |
24.389 | 17.292 | 41.681 | 27.734 | 69.415 | 22.175 | 16.091 | 38.266 | 28.490 | 66.756 |
| Gross lease yield on real estate available for lease (%) |
6,3% | 5,4% | 5,9% | 8,1% | 6,6% | 6,6% | 5,7% | 6,2% | 8,2% | 6,9% |
| Gross lease yield (including estimated rental value of vacant properties) on real estate available for lease (in %) |
6,5% | 5,4% | 6,0% | 9,3% | 7,1% | 6,9% | 5,8% | 6,4% | 9,2% | 7,4% |
| Average remaining duration of lease agreements (until first expiry date) (in years) |
3,7 | 6,3 | 4,8 | 2,6 | 3,9 | 3,4 | 6,8 | 4,8 | 2,9 | 4,0 |
| Average remaining duration of lease agreements (until end of agreement) (in years) |
5,3 | 6,5 | 5,8 | 3,9 | 5,0 | 5,2 | 7,0 | 5,9 | 4,5 | 5,3 |
| Occupancy rate (EPRA) (in %) | 98% | 100% | 99% | 87% | 94% | 95% | 98% | 96% | 88% | 93% |
| Number of leasable sites | 21 | 15 | 36 | 14 | 50 | 21 | 14 | 35 | 14 | 49 |
| Gross leasable surface area (in thousands of m²) |
490 | 313 | 803 | 246 | 1.049 | 490 | 310 | 800 | 246 | 1.046 |
* All concepts and their calculations are included in a lexicon on the www.intervest.be website, called "Terminology and alternative performance measures and as an annex to this press release".
Interim statement by the supervisory board for the third quarter of 2021
Antwerp, 8 November 2021 Regulated information Embargo until 08.11.2021, 6:00 p.m.
Leasing activities and occupancy rate
Active leasing policy leads to an increase in logistics occupancy rate and future rental income, stable remaining duration and improvement in the quality of the portfolio
The occupancy rate of the total portfolio available for rent amounts to 94% as at 30 September 2021, an increase of 1% compared to year-end 2020 (93%). This increase in occupancy rate is the result of an active letting policy resulting in some nice rental transactions.
This increase in the total occupancy rate is caused by an increase in the occupancy rate of the logistics portfolio to 99%, an increase of 3 percentage points compared to 31 December 2020 (96%).
As at 30 September 2021, the logistics occupancy rate in Belgium is 98% compared to 95% as at 31 December 2020. This increase can be explained by the completion of the vacant new-build units of approximately 25.000 m² at the end of last year in Genk Green Logistics which have been let to Eddie Stobart Logistics Europe. In the Netherlands, the occupancy rate is 100%, where it was 98% at year-end 2020. This increase is the result of the take-up of the remaining leasable area in Roosendaal Braak by the tenant already present on the site.
The occupancy rate in the office portfolio amounts to 87% as at 30 September 2021, which has decreased slightly compared to 31 December 2020 (88%).
In addition to improving the occupancy rate, an important pillar of the letting policy is improving the quality of the portfolio and the associated rental contracts. For example, by extending the lease terms, anticipating future vacancy or thinking along with the needs of its customers, Intervest tries to make a difference.
Interim statement by the supervisory board for the third quarter of 2021
Antwerp, 8 November 2021 Regulated information Embargo until 08.11.2021, 6:00 p.m.
In this context, the following rental transactions were concluded in the existing logistics portfolio in the third quarter of 2021:
- 〉 In Herstal, the lease term with Vincent Logistics has been extended by three years until 2027 as a result of some adaptation works at the request of the customer. This results in a win-win for both parties.
- 〉 In Herentals, following the previously announced departure at the end of 2021 of Nike Europe Holding (33.356 m²), agreements have been concluded with two new tenants, Biscuiterie Thijs and transport company Van de Poel , each a unit of more than 10.000 m² and 2.000 m² mezzanine. Biscuiterie Thijs also rents office space for a total of 898 m². With Biscuiterie Thijs an agreement has been concluded for a maximum term of 5 years and 3 months. The agreement with the transport company Van de Poel has been concluded for a maximum term of 10 years and 4 months. Both tenants have since moved into the site. As a result, the lease of Nike Europe Holding was terminated early in the third quarter of 2021, for which a severance payment was received.
- 〉 In Oevel, a severance payment for an early departure was also received from Vos Logistics. The approximately 12,000 m² leasable area has meanwhile been leased to a new tenant, Post NL Pakketten België, for a term of 3,5 years.
In addition, in the third quarter of 2021, the transfer of the first logistics site in Breda was completed by its own dedicated team in the Netherlands, operating from the Intervest office in Eindhoven. This contemporary, sustainable logistics building currently covers approximately 2.500 m², has an associated detached office building of approximately 1.000 m² and a truck parking area of 20.000 m². The sale-and-lease-back agreement with Nouwens Transport Breda for this site has been concluded for a term of 17,7 years – with a break after 12,7 years. The lease, under a triple net regime, has therefore started.
Adjacent to the existing warehouse, the sale-and-leaseback agreement also provides for an expansion of 3.650 m² of warehouse space, creating a total of 6.000 m² of logistics space next to the office space. This transaction will materialize upon completion of this new building and is expected in the first quarter of 2022. The expansion will meet high quality standards.
The leasing policy is also showing its success in projects under construction. The (pre-)letting transactions realized in the projects under construction are not yet included in the occupancy rate calculation1 . The further commercialization of Genk Green Logistics with the acquisition of a third tenant in September 2021 is a leading rental transaction. A long-term lease has been signed with
1 The occupancy rate is calculated as the relation between the estimated rental values of the leasable spaces and the estimated rental value of the total portfolio available for rent at closing date.
Regulated information Interim statement by the supervisory board for the third quarter of 2021
Antwerp, 8 November 2021 Embargo until 08.11.2021, 6:00 p.m.
Neovia Logistics for a unit of more than 10.000 m² to be built. After the signing of Eddie Stobart Logistics and P&O Ferrymasters earlier this year, another renowned international player was welcomed, which means that almost 20% of the available 250.000 m² on the former Ford site in Genk has now been leased. Discussions with interested parties for various other units are already well advanced.
At the end of June 2021, a lease agreement was concluded with Schrauwen Sanitair en Verwarming (part of the STG-group) in Herentals Green Logistics for 22.000 m² of storage and office space for a period of 13,5 years. The commercialization of the other units is in full swing and advanced discussions with interested parties are ongoing.
In total, a leasable area of approximately 184.000 m² was extended or renewed in 25 transactions in the first nine months of 2021. The transactions represent a gross annual rent of € 8,6 million or 13% of the contractual annual rent as at 31 December 2020. Of this, approximately 174.000 m² or € 7,4 million rental income has been realized in the logistics portfolio. The most important transactions in this segment are the leases concluded in Genk Green Logistics, Herentals Green Logistics, Herstal and Oevel. In addition, approximately 9.000 m² or € 1,2 million rental income was realized in the office portfolio. This mainly
Herentals 〉 Schrauwen Sanitair en Verwarming
concerns transactions in Mechelen Campus and a temporary lease in Aartselaar.
These transactions result in a stable average remaining contractual term until next due date (WALB) in the entire portfolio of 3,9 years as at 30 September 2021. For the logistics portfolio this is 4,8 years and for the offices 2,6 years.
At the end of last year, 22% of the leases, based on annual rental income, reached an interim or final expiry date in the course of 2021.
As at 30 September 2021, this amounted to 13%, i.e. 8% in the office portfolio and 5% in the logistics portfolio.
In the logistics portfolio, 3% is represented by ASML, a tenant in the Eindhoven site (Silver Forum). In the meantime, an agreement has been reached with ASML to extend the lease by two years until the end of 2023. This transaction is not yet included in the figures of 30 September 2021. For the remaining 2% in the logistics portfolio, advanced negotiations are ongoing.
In the office portfolio, PricewaterhouseCoopers, which represents 5% of the rental income, will effectively leave the Woluwe Garden site as at 31 December 2021. Intervest has analyzed the future possibilities for this office building and opted for the implementation of a Greenhouse concept. The redevelopment process will start after the lease has expired. The remaining 3% of the leases in the office portfolio concern part of the leases of Galapagos in Mechelen with which discussions are currently ongoing and a suitable solution is being sought for both the tenant and the optimization of the entire Mechelen Campus site.
The tenants who actually left in the first nine months of 2021 (5% of the annual rental income) only canceled on average after a rental period of 8 years.
Interim statement by the supervisory board for the third quarter of 2021
Antwerp, 8 November 2021 Regulated information Embargo until 08.11.2021, 6:00 p.m.
Real estate portfolio
For €32 million investments in sustainable project developments by in-house team
The fair value of the investment properties as at 30 September 2021 amounts to €1.115 million (€1.018 million as at 31 December 2020). In addition to the property available for rent in the amount of approximately €1.021 million, this total value includes approximately €94 million in project developments. These project developments include projects whose construction has already started, such as the Greenhouse Collection office building in Antwerp and the logistics redevelopments in Herentals (Herentals Green Logistics) and in Genk (Genk Green Logistics) where the construction works of the new units of 10.000 m² each for P&O Ferrymasters and Neovia Logistics have started. The total value of these project developments under construction amounts to € 78 million as at 30 September 2021. In addition to the project developments under construction, the project developments include € 16 million in land reserves in Genk, Herentals, 's-Hertogenbosch (NL) and Venlo (NL), available for future developments.
The increase in the fair value of investment properties by € 97 million or 9,5% compared to 31 December, 2020 can be explained by:
In the logistics portfolio
- 〉 Investments in project developments and land reserves for € 22 million; mainly the investments in the further completion of Herentals Green Logistics, in Genk Green Logistics and in the definitive acquisition of the land position in Venlo in May 2021, located next to the existing buildings of Intervest
- 〉 Acquisition of the logistics site in Breda in the Netherlands for € 14 million
- 〉 Investments of €4 million to improve the existing logistics portfolio
- 〉 Value increase in the fair value of the logistics real estate portfolio for an amount of € 53 million or 8%, mainly due to the further tightening of yields and leases in the existing portfolio and projects under construction.
In the office portfolio
- 〉 Investments in project developments and land reserves for € 10 million; fully attributable to the further completion of the redevelopment of Greenhouse Collection in Antwerp
- 〉 Investments of €1 million to improve the existing office portfolio
- 〉 Depreciation in the office portfolio of € 7 million or 2% mainly as a result of the assessment by the real estate experts on some properties in the current uncertain economic situation and additionally by considering Woluwe Garden as residual land value.
The ratio of the real estate segments in the portfolio as at 30 September 2021 is 65% logistics real estate and 35% office buildings. 45% of the logistics real estate portfolio is located in the Netherlands.
As at 30 September 2021, the total real estate portfolio has a leasable area of 1.049.358 m².
Interim statement by the supervisory board for the third quarter of 2021
Antwerp, 8 November 2021 Regulated information Embargo until 08.11.2021, 6:00 p.m.
Projects under construction & development potential
In addition to the real estate available for rent, Intervest also has projects under construction and future development potential. The total (potential) leasable area of this is approximately 335.000 m². Based on the current real estate market data, this means a future potential increase in value of the real estate portfolio over a period Q4 2021 - 2025 between € 238 million and € 281 million compared to the value of the total investment properties as at 30 September 2021.
| Segment | Type | Country | (Potential) GLA in m² |
Expected delivery |
BREEAM | |
|---|---|---|---|---|---|---|
| Genk Green Logistics | Logistics | Development | BE | 10.000 | 2021 | Excellent |
| Genk Green Logistics | Logistics | Development | BE | 10.000 | 2022 | Excellent |
| Herentals Green Logistics | Logistics | Development | BE | 45.000 | 2021 | Excellent |
| Greenhouse Collection | Offices | Redevelopment | BE | 15.000 | 2022 | Excellent |
| ONGOING DEVELOPMENT PROJECTS | 80.000 | |||||
| Genk Green Logistics | Logistics | Development | BE | 205.000 | 2022-2025 | Excellent |
| Herentals Green Logistics | Logistics | Development | BE | 8.000 | ||
| 's-Hertogenbosch Rietvelden | Logistics | Development | NL | 8.500 | Outstanding | |
| Venlo | Logistics | Development | NL | 10.000 | Outstanding | |
| DEVELOPMENT POTENTIAL | 231.500 | |||||
| Greenhouse Woluwe Garden* | Offices | Redevelopment | BE | 23.700 | 2023 | Outstanding |
| FUTURE PROJECT DEVELOPMENT | 23.700 | |||||
| TOTAL PROJECTS | 335.200 |
* Woluwe Garden will be redeveloped into Greenhouse Woluwe Garden and is still considered as real estate for rent as at 30 September 2021
Interim statement by the supervisory board for the third quarter of 2021
Antwerp, 8 November 2021 Regulated information Embargo until 08.11.2021, 6:00 p.m.
Genk Green Logistics (BE): redevelopment zone B former Ford-site continues
Attracted a third tenant, as a result of which almost 20% of the available 250.000 m² is already (pre)let.
The further elaboration of the Genk Green Logistics redevelopment project is proceeding as planned. On zone B of the former Ford site, a logistics and semi-industrial complex of approximately 250.000 m² with BREEAM 'Excellent' certification, consisting of 21 units, is being built. On the site, sustainability and multimodality go hand in hand.
At the end of 2020, two units, together representing approximately 25.000 m² of sustainable state-of-the-art logistics space, were completed. For these two units, Genk Green Logistics entered into a lease agreement with Eddie Stobart Logistics Europe in April 2021 for a period of three years1 . This logistics service provider moved into the first units of the Galaxy block in June 2021.
Earlier this year, a built-to-suit lease agreement2 was concluded with P&O Ferrymasters for a warehouse of over 10.000 m². The construction works on this new unit have meanwhile started, with completion scheduled for the end of 2021.
In September 2021, the third tenant3, again a renowned international player, was acquired. A long-term lease has been concluded with this third tenant, Neovia Logistics, for a unit to be built of over 10.000 m² with 1.000 m² of mezzanine facilities and 500 m² of offices. The construction works have now started and the completion of this warehouse is scheduled for the first quarter of 2022.
The commercialization of Genk Green Logistics is continuing at full speed and various discussions are ongoing with several interested national and international parties.
More information about this project can be found at www.genkgreenlogistics.be.
- 1 See press release 20 April 2021: "Genk Green Logistics attracts first tenant"
- 2 See press release 10 June 2021: "Genk Green Logistics attracts second tenant to former Ford-site"
- 3 See press release 7 September 2021: "Genk Green Logistics attracts tenant to former Ford site again".
Interim statement by the supervisory board for the third quarter of 2021
Antwerp, 8 November 2021 Regulated information Embargo until 08.11.2021, 6:00 p.m.
Herentals Green Logistics (BE): sustainable cluster of 45.000 m² offices and logistics
Intervest is developing on the 18 ha site in Herentals approximately 42.000 m² of warehouses with a cross dock, approximately 3.000 m² of office space and also provides a parking tower on five levels with more than 400 parking spaces. This creates a unique and sustainable cluster of offices and logistics of a total of more than 100.000 m² on the Atealaan in Herentals.
Under the guidance of #TeamIntervest, the construction of five units according to BREEAM 'Excellent' standards has started. The construction works are proceeding according to plan.
An agreement has already been concluded with Schrauwen Sanitair en Verwarming (part of the STG-group) for 22.000 m² for a period of 13,5 years. The construction works for this unit were completed mid-October 2021. The completion of the next 14.000 m² is planned for the first
quarter of 2022. The commercialization of the other units is in full swing and discussions with interested parties are already well advanced.
At the existing site in Herentals of 50.912 m², following the previously announced departure at the end of 2021 of Nike Europe Holding (33.356 m²), agreements have been concluded with two new tenants, Biscuiterie Thijs and transport company Van de Poel, each a unit of more than 10.000 m² and 2.000 m² mezzanine. Biscuiterie Thijs also rents office space for a total of 898 m². With Biscuiterie Thijs an agreement has been concluded for a maximum term of 5 years and 3 months. The agreement with the transport company Van de Poel is concluded for a maximum term of 10 years and 4 months. These transactions provide further diversity on the site in Herentals.
Both tenants have since moved into the site. As a result, the lease of Nike Europe Holding was terminated early in the third quarter of 2021 for which a severance payment has been received.
Greenhouse Collection (BE) at the Singel: prestigious office project at top location
Iconic building becomes even more iconic
In November 2020, Intervest acquired an office renovation project at an excellent location along the Singel in Antwerp1 . After completion of the renovation process, this state-of-the-art project will be one of the top office buildings in Antwerp.
Intervest aims to realize a renewed, sustainable and future-oriented smart project at this high-profile location by using top techniques and meeting the BREEAM 'Excellent' building standards. The building has six floors with large spaces, 15.000 m² of offices and 184 parking spaces.
1 See press release 18 November 2020: "Intervest acquires prestigious office project at top location in Antwerp"
Interim statement by the supervisory board for the third quarter of 2021
Antwerp, 8 November 2021 Regulated information Embargo until 08.11.2021, 6:00 p.m.
The commercialization as Greenhouse Collection at the Singel, an office concept that integrates elements of Intervest's existing Greenhouse hubs and links them to an exclusive office experience, has started. Sustainability, innovation and experience are the keywords that describe Greenhouse Collection. Greenhouse Collection was designed by Intervest to further expand its philosophy on workspaces and will embrace the needs for flexibility, quality, connection and experience. In addition to a collection of office solutions, such as private spaces, service offices and coworking space, a fully-fledged meeting center and a luxuriously fin-
ished boardroom will contribute to local professional life. And to really go beyond real estate, Greenhouse Collection will also integrate finer elements of culture, art and gastronomy.
This project, which is expected to generate rental income in the first semester of 2022, is in line with the #connect2022 strategy, which aims at reorienting towards more future-oriented office buildings in cities with a student population such as Antwerp. Intervest also immediately takes over the further development under its own management and thus gains direct control over a larger part of the value chain.
's-Hertogenbosch (NL): new-build development of logistics site Rietvelden
The development potential in 's-Hertogenbosch arose through the expansion of a logistics cluster after the purchase earlier in June 20201 of four buildings adjacent to the land position that has been owned by Intervest since August 2019.
This built-to-suit project includes a warehouse, mezzanine and an office and provides approximately 8.500 m² of additional sustainable value creation, according to BREEAM 'Outstanding' standards.
Given the limited availability of comparable real estate objects and comparable development locations in this region, the rental potential is estimated positively.
1 See press release 8 June 2020: "Intervest Offices & Warehouses acquires Rietvelden, site in 's-Hertogenbosch."..
Interim statement by the supervisory board for the third quarter of 2021
Antwerp, 8 November 2021 Regulated information Embargo until 08.11.2021, 6:00 p.m.
Venlo (NL): land position
The definitive acquisition of the land position in Venlo1 , located next to existing Intervest buildings, gives tangible shape to the possibility of additional development of a logistics building of approximately 10.000 m², in accordance with BREEAM 'Outstanding' standards. This acquisition fits in the #connect2022 strategy to create sustainable value for customers with its own #TeamIntervest and to further expand the logistics portfolio in the Netherlands.
The land position is located on the Venlo Trade Port business park, with a favourable location near several highway exits. The site has tri-modal access due to its location almost right next to the ECT rail terminal and at a short distance from the barge terminal, which is a unique asset compared to competing locations.
Given the limited availability of less large-scale areas in the Venlo region and the prime location of the site, the rental potential of the land position is assessed positively.
1 See press release 27 May 2021: "Intervest signs delivery deed for land position in Venlo"
Interim statement by the supervisory board for the third quarter of 2021
Antwerp, 8 November 2021 Regulated information Embargo until 08.11.2021, 6:00 p.m.
Sustainability
Successful #connect2022 strategy lays foundations for a detailed roadmap for drawing up the ESG policy in the long term
Also in the third quarter of 2021, Intervest will actively focus on sustainable value creation. The #connect2022 strategy sets concrete, measurable objectives for the period up to the end of 2022:
- 〉 The aim is to have 30% of the real estate portfolio certified at least BREEAM 'Very Good'. As at 30 September 2021, 26% of the buildings are at least BREEAM 'Very Good' certified.
- 〉 Intervest wants to have 80% of the logistics real estate equipped with photovoltaic installations. As at 30 September 2021, 66% of the properties in the logistics portfolio are equipped, good for 30 MWp installation or energy needs of 7.730 families, the equivalent of the CO2 absorption of 974 hectares of forest and the avoidance of approximately 9.740 tons of CO2 emissions.
- 〉 Under the motto 'to measure is to know', the aim has been formulated to equip 80% of the real estate portfolio with smart meters. As at 30 September 2021, an energy monitoring system was installed in 54% of the real estate portfolio.
- 〉 Intervest undertakes to exclusively purchase electricity generated from sustainable sources. Intervest has had an electricity contract with Engie already for several years that provides electricity from renewable sources.
Sustainability also builds on digitization. Intervest integrates new digital technologies to streamline operational processes and to optimize communication with stakeholders. An example of this can be found in the extensive digitization that is applied in the iconic office project Greenhouse Collection at the Singel in Antwerp. Building users can enter the building with their smartphone, book meeting rooms, let guests in and adjust the temperature at their workplace. The car park is equipped with a smart parking system. These digital solutions increase well-being and contribute to optimal use of the available spaces and energy consumption.
The kick-off was also given to the charging infrastructure project for electric cars (PHEV and FEV) at parking places in the entire portfolio. This was done in collaboration with a specialized study bureau. Each site has been thoroughly analyzed in terms of electrical connection options and infrastructure. An action plan was then worked out for each building. The necessary preparations for a general tender are currently being made.
Project charging infrastructure for electric cars
Interim statement by the supervisory board for the third quarter of 2021
Antwerp, 8 November 2021 Regulated information Embargo until 08.11.2021, 6:00 p.m.
In the third quarter of 2021, Intervest's clear 'beyond real estate' mission is once again being translated into a number of unique turnkey solutions with the necessary attention to sustainability. As such, with a view to a pleasant experience for the tenants of Mechelen Business Tower, the impressive entrance hall of the office building in Mechelen-North has been renovated. The entrance hall is filled with extra greenery, among other things, which makes the space look much more lively and fresh, but has also become a more pleasant place to enjoy a coffee or to welcome a visitor.
At the end of 2020, all 17 SDGs (Sustainable Development Goals of the United Nations) have been addressed in Intervest's sustainability policy. In October 2021, Intervest received the internationally recognized SDG Pioneer certificate for this from UNITAR Secretary-General Nikhil Seth.
Intervest is clearly on track to achieve the concrete sustainable objectives included in its #connect2022 strategy.
Building on the foundations already laid for this successful #connect2022 strategy, a detailed roadmap has been drawn up to outline the long-term ESG policy (Environmental Social Governance) at Intervest. As such, in 2021 Intervest will continue to work on drawing up an ESG charter with concrete objectives such as reducing CO2 emissions, for example. This charter will integrate sustainability into all activities of the company and ensure a continuous optimization of sustainable entrepreneurship within Intervest and with regard to external stakeholders.
Intervest's ESG strategy will be built around four focus areas that address the most relevant environmental, social and corporate governance trends to create value for all stakeholders:
- 〉 Future-proof buildings
- 〉 Energy transition
- 〉 Health & wellbeing
- 〉 Transparency
Improving ESG performance is an integral part of the long-term value creation strategy and is embedded in Intervest's DNA.
Interim statement by the supervisory board for the third quarter of 2021
Antwerp, 8 November 2021 Regulated information Embargo until 08.11.2021, 6:00 p.m.
Financial results for the first nine months of 2021
Analysis of the results1
Organic growth of rental income with 5% through active rental policy
The rental income of Intervest in the first nine months of 2021 amounts to €48,5 million (€45,4 million). This increase of € 3,1 million or 7% compared to the first nine months of 2020 is mainly due to higher rental income in the logistics segment, as a result of the realized acquisitions, the completed project developments and the rental transactions in the course of 2020 and one-off severance payments received as a result of early termination of contracts in the logistics portfolio for an amount of € 0,6 million. The organic growth of the rental income in the first nine months of 2021 amounts to 5% or € 2,0 million compared to the same period last year.
The costs of the lessee and borne by the owner on rental damage and refurbishment amount to € 0,3 million and have decreased by € 0,4 million compared to the first nine months of 2020 (€ 0,7 million) as a result of a lower number of refurbishments on new leases in the office segment.
The property charges amount to € 6,2 million for the first nine months of 2021 (€ 6,4 million). The decrease of € 0,2 million is mainly caused by a decrease in the internal management costs of the real estate, partly offset by higher commercial and technical costs, where the growth of the portfolio in the Netherland causes an increase in the non-transferable insurance premiums and costs.
General expenses amount to € 3,0 million, a decrease of € 0,2 million compared to the first nine months of 2020 (€ 3,2 million), a result of lower office costs and personnel costs.
The rise in rental income combined with a decrease in property and general costs means that the operating result before the result on portfolio increased by € 4,0 million or 11% to € 39,8 million (€ 35 ,8 million).
The operating margin rose from 79% in the first nine months of 2020 to 82% in the first nine months of 2021, driven by an active rental policy and cost monitoring.
The result on the sale of investment properties in the first nine months of 2021 amounts to € 0,2 million. This concerns a reversal of a previously foreseen to be paid rent guarantee, granted on the sale of Oudsbergen in 2019, the conclusion of which was paid in the third quarter of 2021.
1 The figures between brackets are the comparative figures for the first nine months of 2020.
Interim statement by the supervisory board for the third quarter of 2021
Antwerp, 8 November 2021 Regulated information Embargo until 08.11.2021, 6:00 p.m.
The changes in the fair value of the investment properties amount to € 45,9 million (€ 10,0 million) in the first nine months of 2021. The positive changes in fair value are the combined result of:
- 〉 the rise in the fair value of the logistics real estate portfolio for an amount of € 52,5 million or 8%, mainly as a result of the further tightening of yields and leases in the existing portfolio and projects under construction
- 〉 the fall in the fair value of the office portfolio of € 6,6 million or 2% mainly as a result of the assessment made by the real estate experts on some properties in the current uncertain economic situation and additionally by considering Woluwe Garden as residual land value.
The other result on portfolio in the first nine months of 2021 amounts to € -5,9 million (€ -5,3 million) and mainly includes the deferred taxes on unrealized gains on the investment properties belonging to the perimeter companies of Intervest in the Netherlands and Belgium.
The financial result (excl. changes in fair value of financial assets and liabilities) for the first nine months of 2021 amounts to € -5,4 million (€ -5,9 million). The €0,5 million decrease in net interest charges, despite a higher average capital take-up in 2021, was the result of the refinancing of hedging instruments, the higher take-up in the commercial paper programme and the repayment of the €35 million bond loan at the end of the first quarter of 2021. As a result, the average interest rate on financing also fell from 2,0% in the first nine months of 2020 to 1,8% for the first nine months of 2021.
The changes in the fair value of financial assets and liabilities include the change in the negative market value of the interest rate swaps that cannot be classified as cash-flow hedging instruments in accordance with IAS 39, for an amount of €1,8 million (€-2,3 million).
The net result of Intervest for the first nine months of 2021 amounts to €75,8 million (€33,2 million). The net result – shareholders Group for the first nine months of 2021 amounts to €73,8 million (€33,2 million) and can be divided into:
- 〉 the EPRA earnings of € 33,8 million (€ 29,5 million) or a rise of € 4,3 million or 15% mainly a combination of higher rental income as a result of acquisitions, the delivery of projects, realized rental transactions in the course of of 2020 and one-off severance payments received and a decrease in financing costs, real estate costs and general costs
- 〉 the result on portfolio shareholders Group of € 38,3 million (€ 6,0 million)
- 〉 the changes in the fair value of financial assets and liabilities in the amount of € 1,8 million (€ -2,3 million).
The EPRA earnings amounts to € 33,8 million for the first nine months of 2021. Taking into account 25.875.874 weighted average number of shares, this means EPRA earnings per share of € 1,30 for the first nine months of 2021. This represents an increase of 10% or € 0,12 per share compared to the same period last year (€ 1,18).
Regulated information Interim statement by the supervisory board for the third quarter of 2021
Antwerp, 8 November 2021 Embargo until 08.11.2021, 6:00 p.m.
| KEY FIGURES | 30.09.2021 | 31.12.2020 | 30.09.2020 |
|---|---|---|---|
| Number of shares at the end of the period | 26.300.908 | 25.500.672 | 25.500.672 |
| Weighted average number of shares | 25.875.874 | 25.164.126 | 25.051.126 |
| Net value (fair value) (€) | 22,74 | 21,46 | 21,05 |
| Share price on closing date (€) | 23,65 | 22,55 | 22,60 |
| Premium to fair net value (%) | 4% | 5% | 7% |
| Market capitalisation (in million €) | 622 | 575 | 576 |
| Debt ratio (max. 65%) | 42,9% | 43,0% | 42,7% |
As at 30 September 2021, the net value (fair value) of the share is € 22,74 (€ 21,46 as at 31 December 2020). Since the share price of the Intervest share (INTO) as at 30 September 2021 is € 23,65, the share is quoted on the closing date with a premium of 4% compared to the net value (fair value).
| EPRA – KEY FIGURES | 30.09.2021 | 31.12.2020 | 30.09.2020 |
|---|---|---|---|
| EPRA earnings (€ per share) (Group share) | 1,30 | 1,60 | 1,18 |
| EPRA NTA (€ per share)* | 23,80 | 22,40 | 21,87 |
| EPRA NRV (€ per share)* | 25,62 | 24,08 | 23,31 |
| EPRA NDV (€ per share)* | 22,67 | 21,37 | 20,96 |
| EPRA NIY (Net Initial Yield) (%) | 5,7% | 5,7% | 5,8% |
| EPRA Topped-up NIY (%) | 5,8% | 5,8% | 6,1% |
| EPRA Vacancy rate (%) | 6,5% | 7,3% | 7,7% |
| EPRA cost Ratio (including direct vacancy costs) (%) | 18,1% | 20,1% | 21,2% |
| EPRA cost Ratio (excluding direct vacancy costs) (%) | 16,7% | 18,7% | 19,9% |
* In October 2019, EPRA published the new Best Practice Recommendations for financial disclosures of listed real estate companies. EPRA NAV and EPRA NNNAV are replaced by three new Net Asset Valuation indicators, namely EPRA NRV (Net Reinstatement Value), EPRA NTA (Net Tangible Assets) and EPRA NDV (Net Disposal Value). The EPRA NTA largely matches the "old" EPRA NAV.
EPRA Net Reinstatement Value (NRV) provides an estimate of the sum required to reinstate the company via the investment markets based on the current capital and financing structure, including the real estate transfer tax. EPRA Net Tangible Assets (NTA) assumes that the company acquires and sells assets, which would result in the realisation of certain unavoidable deferred taxes.
EPRA Net Disposal Value (NDV) represents the value accruing to the shareholders of the company in the event of a sale of its assets, which would result in the settlement of deferred taxes, the liquidation of the financial instruments and the recognition of other liabilities at their maximum amount, less taxes.
The EPRA NTA per share as at 30 September 2021 amounts to € 23,80. This represents an increase of € 1,40 compared to € 22,40 as at 31 December 2020, mainly as a result of the combination of the EPRA earnings generation, the increase in the value of the property portfolio and the dividend payment for the financial year 2020.
Regulated information Interim statement by the supervisory board for the third quarter of 2021
Antwerp, 8 November 2021 Embargo until 08.11.2021, 6:00 p.m.
Financial structure
Further optimization leads to increase of the average remaining term of the long-term credit lines up to 4,3 years
In the third quarter of 2021, Intervest further optimized its financing portfolio. As part of a staggered extension of the current credit lines, the credit line of €15 million at BNP Paribas Fortis, which matured mid-2022, was extended until the end of 2026 and at KBC Bank the credit line of €25 million, which expires at the end of 2022 is extended until the end of 2027.
As a result, the average remaining duration of the long-term credit lines has therefore increased to 4,3 years compared to 3,8 years as at 31 December 2020.
In addition, no more financing will expire until 2023. The commercial paper programme is fully hedged with additional back-up lines.
A broad base of investors continues to show strong interest in the commercial paper programme in the third quarter of 2021, from which an increase in the use to nearly €100 million followed as at 30 September 2021.
The average interest rate of the financing will be further tightened to 1,8% including bank margins (2,0% as at 31 December 2020).
The interest cover ratio is equal to 7,4x for the first nine months of 2021 compared to 6,2x for 2020. As at 30 September 2021, the hedging ratio amounts to 70% of the loans taken out through fixed-rate financing or hedging with interest rate swaps (75% as at 31 December, 2020). The interest rates on these loans from the company are fixed as at 30 September 2021 for a weighted average remaining term of 5,3 years (4,1 as at 31 December 2020).
The debt ratio of 42,9% as at 30 September 2021 gives sufficient room to invest with debt
before reaching the upper end of the strategic bandwidth of 45%-50%. Based on this debt ratio, Intervest has an additional investment capacity of approximately € 163 million, without exceeding the upper limit of the strategic bandwidth of 50%.
As at 30 September 2021, Intervest has approximately €120 million in undrawn committed credit lines (after hedging of the commercial paper issued) for the financing of ongoing project developments and future acquisitions.
Regulated information Embargo until 08.11.2021, 6:00 p.m. Interim statement by the supervisory board for the third quarter of 2021
Antwerp, 8 November 2021
EPRA Awards
.
Gold for Annual Report 2020 and Silver for Sustainability Report 2020
The Annual Report 2020 of Intervest has again won an EPRA Gold Award during the annual conference of the European Public Real Estate Association. It is the seventh time in a row that Intervest has received a Gold Award for its annual report from this leading association that advocates an improvement in transparency and consistency in financial reporting.
EPRA formulates recommendations in so-called BPR or Best Practice Recommendations that provide a framework of comparability in the real estate sector.
EPRA has also expanded this to recommendations and reporting with regard to sustainability, the so-called sustainability BPR. The Intervest Sustainability Report 2020, the second edition, has won an EPRA sBPR Silver Award.
These Awards are a recognition of the continuous efforts of Intervest for consistent and transparent reporting in the financial field and in the field of sustainability.
Interim statement by the supervisory board for the third quarter of 2021
Antwerp, 8 November 2021 Regulated information Embargo until 08.11.2021, 6:00 p.m.
Outlook 2021
With #connect20221 , launched mid-2020, Intervest has set out the strategic lines for the coming years: realizing a well-considered growth of 30% of the fair value of the real estate portfolio, improving the quality of the real estate portfolio through asset rotation, realizing the entire value chain of purchase up to delivery of the property with an in-house dedicated and motivated team, with an eye for sustainability on both the investment and financing side.
Intervest will continue to implement this approach in the last quarter of 2021 and in 2022 without prejudice, with value creation for all stakeholders, taking into account sustainability in various areas, supported by a customer-oriented team.
Investments and development potential
Intervest focuses in both segments on both future development potential and future-proof upgrading of the existing portfolio
Intervest is committed to creating value for its stakeholders by generating solid and recurring cash flows on a well-diversified real estate portfolio, while respecting the environment, social aspects and good governance. In doing so, the company wants to take agile advantage of the respective investment cycles and the underlying rental market in logistics and offices, the two segments of the real estate portfolio.
In logistics real estate, the focus is on sites with multimodal accessibility and a critical size.
In this market segment, scarcity and the increasing importance of e-commerce, partly influenced by the corona crisis, have led to a certain overheating of the market, both in Belgium and in the Netherlands. Purchases of logistics real estate are becoming expensive, as a result of which Intervest is evolving more towards project developments under its own management or in collaboration with partners and its own #TeamIntervest. Existing logistics real estate sites will be redeveloped into future-proof logistics buildings with expected higher leas ability.
In addition, Intervest continues to invest in logistics real estate with future development
potential, both around existing locations and at new locations so that new and existing logistics clusters can be further expanded. Nice illustrations of this are the Herentals Green Logistics and Genk Green Logistics sites in Belgium, and the Venlo and 's-Hertogenbosch sites in the Netherlands.
1 See press release 18 June 2020: "Intervest Offices & Warehouses presents strategy #connect2022".
The Netherlands - 's-Hertogenbosch 〉 Artist's impression
Interim statement by the supervisory board for the third quarter of 2021
Antwerp, 8 November 2021 Regulated information Embargo until 08.11.2021, 6:00 p.m.
In terms of investments for the office segment, Intervest continues to strive for the acquisition of high-quality properties at attractive and easily accessible locations with an important student population on the one hand, and on the other hand continues to pay the necessary attention to the future-proof upgrade of existing properties in the portfolio.
Antwerp 〉 Greenhouse Collection at the Singel - Artist's impression
Office buildings at a good location, especially in cities with a student population, are becoming scarce. In addition, due to the corona crisis, trends in the office segment can be observed that will influence the future way of working, such as the evolution towards a mixed working environment. There is clearly an increasing need for flexibility and mobility in order to be able to work independent of place and time. On the business side, this translates into a need for greater flexibility in terms of m² and contract terms. Flexibility in spaces, coworking and serviced offices are becoming the natural buffers to be able to organize this efficiently.
With the Greenhouse concept, which has
been successfully realized in Berchem, Diegem and Mechelen, Intervest offers an adequate answer to these needs. Also with the prestigious office renovation project Greenhouse Collection at the Singel in Antwerp Intervest is going beyond real restate. Building on the successful (ongoing) redevelopment of these office buildings, Woluwe Garden has also opted for the implementation of the Greenhouse concept with the experienced
TeamIntervest. More than ever, the combination of an inspiring office environment with extensive services is the key to future-proof value creation. Woluwe Garden will be redeveloped into Greenhouse Woluwe Garden. The redevelopment project will start definitively after the lease contract has expired at the end of 2021.
It is becoming increasingly difficult to purchase quality real estate, leased at a long-term basis, for a decent return. Intervest therefore continues to focus on redevelopments and investments in the logistics and office real estate segments with future development potential. This means that rental income may be slightly delayed and will not immediately be reflected in the results.
Woluwe 〉 Greenhouse Woluwe Garden - Artist's impression
Interim statement by the supervisory board for the third quarter of 2021
Antwerp, 8 November 2021 Regulated information Embargo until 08.11.2021, 6:00 p.m.
EPRA earnings and gross dividend
Rise in expected EPRA earnings per share to €1,70 - €1,72 results in an increase of approximately 7% compared to 2020
In line with the outlines of the #connect2022 strategy, Intervest is committed to keeping a larger part of the value chain in-house. Which mainly means investing in own (re)developments, which, however, do not yet immediately generate rental income.
Intervest does expect for financial year 2021 a growth of the EPRA earnings per share to € 1,70 - € 1,72, an increase of approximately 7% compared to the previous financial year (€ 1,60). This expectation is above the previously communicated margin and is mainly driven by the monitoring of costs, the optimization of the financial structure and the successful delivery of project developments.
Intervest expects a gross dividend for financial year 2021 to be at the same level as for financial year 2020, namely € 1,53 per share. This means a gross dividend yield of 6,5% based on the closing rate of the share as at 30 September 2021, which amounts to € 23,65 and corresponds to a pay-out ratio of approximately 90% of the expected EPRA earnings. This planned gross dividend can be increased if the circumstances relating to the planned investments and/ or additional leases in the real estate portfolio, which lead to a further increase of the EPRA earnings, make it possible and convenient.
This outlook is based on the current knowledge and assessment of interest rate fluctuations, the strategic growth plan #connect2022 and barring unforeseen circumstances (such as possible effects of the corona crisis)
Interim statement by the supervisory board for the third quarter of 2021
Antwerp, 8 November 2021 Regulated information Embargo until 08.11.2021, 6:00 p.m.
Financial calendar 2021 - 2022
Intervest Offices & Warehouses nv (referred to hereafter as "Intervest") is a public regulated real estate company (RREC) founded in 1996, of which the shares have been listed on Euronext Brussels (INTO) since 1999. Intervest invests in high-quality office buildings and logistics properties that are leased to first-rate tenants. The properties in which Intervest invests consist primarily of up-to-date buildings that are strategically located, often in clusters. The office segment of the real estate portfolio focuses on the central cities with an important student population of Antwerp, Mechelen, Brussels and Leuven and their surroundings; the logistics segment of the portfolio in Belgium is located on the Antwerp - Brussels - Nivelles, Antwerp - Limburg - Liège, and Antwerp - Ghent - Lille axes and, in the Netherlands, on the Moerdijk - 's Hertogenbosch - Nijmegen, Rotterdam - Gorinchem - Nijmegen and Bergen-op-Zoom - Eindhoven - Venlo axes. Intervest distinguishes itself in renting space by going beyond merely renting m2. The company goes beyond real estate by offering "turnkey solutions" (a total solution tailored to and with the customer), extensive service provision, co-working and ready-to-use offices.
For more information, please contact intervest offices & warehouses nv, publiC REgulatEd REal EstatE Company undER BElgian law, GunthER GiElEn - CEo oR VinCEnt MaChaRis - Cfo, T. + 32 3 287 67 87. http://www.intervest.be/en
Interim statement by the supervisory board for the third quarter of 2021
Antwerp, 8 November 2021 Regulated information Embargo until 08.11.2021, 6:00 p.m.
Appendices: financial states
Consolidated income statement
| in thousands € | 30.09.2021 | 30.09.2020 |
|---|---|---|
| Rental income | 48.534 | 45.396 |
| Rental-related expenses | -95 | -52 |
| NET RENTAL INCOME | 48.439 | 45.344 |
| Recovery of property charges | 521 | 527 |
| Recovery of rental charges and taxes normally payable by tenants on let properties | 11.492 | 11.693 |
| Costs payable by tenants and borne by the landlord for rental damage and refurbishment |
-261 | -662 |
| Rental charges and taxes normally payable by tenants on let properties | -11.492 | -11.693 |
| Other rental-related income and expenses | 486 | 403 |
| PROPERTY RESULT | 49.185 | 45.612 |
| Technical costs | -899 | -708 |
| Commercial costs | -363 | -216 |
| Charges and taxes on unleased properties | -674 | -597 |
| Property management costs | -3.375 | -3.916 |
| Other property charges | -933 | -973 |
| Property charges | -6.244 | -6.410 |
| OPERATING PROPERTY RESULT | 42.941 | 39.202 |
| General costs | -2.957 | -3.236 |
| Other operating income and costs | -230 | -186 |
| OPERATING RESULT BEFORE RESULT ON PORTFOLIO | 39.754 | 35.780 |
| Result on disposal of investment properties | 198 | 1.470 |
| Changes in fair value of investment properties | 45.924 | 9.958 |
| Other result on portfolio | -5.943 | -5.347 |
| OPERATING RESULT | 79.933 | 41.861 |
| Financial income | 59 | 40 |
| Net interest charges | -5.449 | -5.933 |
| Other financial charges | -20 | -14 |
| Changes in fair value of financial assets and liabilities | 1.771 | -2.345 |
| Financial result | -3.639 | -8.252 |
| RESULT BEFORE TAXES | 76.294 | 33.609 |
| Taxes | -484 | -410 |
| NET RESULT | 75.810 | 33.199 |
Interim statement by the supervisory board for the third quarter of 2021
Antwerp, 8 November 2021 Regulated information Embargo until 08.11.2021, 6:00 p.m.
| in thousands € | 30.09.2021 | 30.09.2020 |
|---|---|---|
| NET RESULT | 75.810 | 33.199 |
| Attributable to: | ||
| Third parties | 1.972 | -12 |
| Shareholders Group | 73.838 | 33.211 |
| NET RESULT - Shareholders Group | 73.838 | 33.211 |
|---|---|---|
| To be excluded: | ||
| - Result on disposals of investment properties | 198 | 1.470 |
| - Changes in fair value of investment properties | 45.924 | 9.958 |
| - Other result on portfolio | -5.943 | -5.347 |
| - Changes in fair value of financial assets and liabilities | 1.771 | -2.345 |
| - Minority interests with respect to the above | -1.878 | 0 |
| EPRA EARNINGS | 33.766 | 29.475 |
| RESULT PER SHARE - GROUP | 30.09.2021 | 30.09.2020 |
| Number of shares entitled to dividend | 26.300.908 | 25.500.672 |
|---|---|---|
| Weighted average number of shares | 25.875.874 | 25.051.126 |
| Net result - Group share (€) | 2,85 | 1,33 |
| Diluted net result - Group share (€) | 2,85 | 1,33 |
| EPRA earnings (€) | 1,30 | 1,18 |
Consolidated statement of comprehensive income
| in thousands € | 30.09.2021 | 30.09.2020 |
|---|---|---|
| NET RESULT | 75.810 | 33.199 |
| Other components of comprehensive income (recyclable through income statement) |
495 | 1.266 |
| Revaluation of solar panels | 495 | 1.266 |
| COMPREHENSIVE INCOME | 76.305 | 34.465 |
| Attributable to: | ||
| Shareholders of the parent company | 74.333 | 34.477 |
| Minority interests | 1.972 | -12 |
Interim statement by the supervisory board for the third quarter of 2021
Antwerp, 8 November 2021 Regulated information Embargo until 08.11.2021, 6:00 p.m.
Consolidated balance sheet
| ASSETS in thousands € | 30.09.2021 | 31.12.2020 |
|---|---|---|
| NON-CURRENT ASSETS | 1.124.618 | 1.022.835 |
| Non-current Intangible assets | 389 | 479 |
| Investment properties | 1.114.644 | 1.017.958 |
| Other non-current tangible assets | 5.393 | 4.022 |
| Non-current financial assets | 4.099 | 241 |
| Trade receivables and other non-current assets | 93 | 135 |
| CURRENT ASSETS | 31.313 | 25.158 |
| Current financial assets | 34 | 13 |
| Trade receivables | 15.824 | 11.595 |
| Tax receivables and other current assets | 3.694 | 6.539 |
| Cash and cash equivalents | 3.952 | 2.682 |
| Deferred charges and accrued income | 7.809 | 4.329 |
| TOTAL ASSETS | 1.155.931 | 1.047.993 |
| SHAREHOLDERS' EQUITY in thousands € | 30.09.2021 | 31.12.2020 |
| SHAREHOLDERS' EQUITY AND LIABILITIES | 607.129 | 554.414 |
| Shareholders' equity attributable to shareholders of the parent company | 597.961 | 547.218 |
| Share capital | 237.930 | 230.638 |
| Share premiums | 189.818 | 181.682 |
| Reserves | 96.375 | 91.467 |
| Net result for the financial year | 73.838 | 43.431 |
| Minority interests | 9.168 | 7.196 |
| LIABILITIES | 548.802 | 493.579 |
| Non-current liabilities | 409.586 | 340.000 |
| Non-current financial debts | 373.290 | 313.743 |
| Credit institutions | 365.290 | 308.743 |
| Other | 8.000 | 5.000 |
| Other non-current financial liabilities | 13.395 | 10.917 |
| Trade debts and other non-current liabilities | 1.455 | 1.267 |
| Deferred tax - liabilities | 21.446 | 14.073 |
| Current liabilities | 139.216 | 153.579 |
| Provisions | 0 | 978 |
| Current financial debts | 98.448 | 123.522 |
| Credit institutions | 648 | 26.239 |
| Commercial Paper | 97.800 | 62.300 |
| Other | 0 | 34.983 |
| Other current financial liabilities | 1 | 94 |
| Trade debts and other current debts | 17.430 | 8.572 |
| Other current liabilities | 1.308 | 1.284 |
| Deferred charges and accrued income | 22.029 | 19.129 |
| TOTAL SHAREHOLDERS' EQUITY AND LIABILITIES | 1.155.931 | 1.047.993 |
Terminology and alternative performance measures third quarter 2021
Alternative performance measures are criteria used by Intervest to measure and monitor its operational performance. The measures are used in the financial reporting, but they are not defined by an Act or in the generally accepted accounting principles (GAAP). The European Securities and Markets Authority (ESMA) issued guidelines which, as of 3 July 2016, apply to the use and explanation of the alternative performance measures. The alternative measures are indicated with ★ and include a definition, objective and reconciliation as required by the ESMA guidelines.
Acquisition value of a real estate property
This term is used to refer to the value at the purchase or the acquisition of a real estate property. If transfer costs are paid, they are included in the acquisition value.
Average interest rate of the financing★
Definition - The average interest rate of the financing of the company is calculated by the (annual) net interest charges and the capitalized intercalary interest, divided by the weighted average debt for the period (based on the daily withdrawal from the financing (credit facilities from financial institutions, bond loans, etc.)). This alternative performance measure is calculated on the basis of the company's consolidated annual accounts.
Application - The average interest rate of the financing measures the average financing cost of the debts and makes it possible to follow how it evolved in time, within the context of the developments of the company and of the financial markets
| Reconciliation in thousands € | 30.09.2021 | 31.12.2020 | 30.09.2020 | 31.12.2019 | |
|---|---|---|---|---|---|
| Net interest charges | A | 7.187 | 7.638 | 7.795 | 8.240 |
| Capitalized intercalary interest | B | 837 | 317 | 315 | 303 |
| Weighted average debt for the period |
C | 448.978 | 397.690 | 390.587 | 400.793 |
| Average interest rate of the financing (based on 360/365) (%) |
=(A+B)/C | 1,8% | 2,0% | 2,0% | 2,1% |
Interim statement by the supervisory board for the third quarter of 2021
Antwerp, 8 November 2021 Regulated information Embargo until 08.11.2021, 6:00 p.m.
Contractual rents
These are the gross indexed annual rents, laid down contractually in the lease agreements, as at closing date, and before rental discounts or other benefits granted to tenants have been deducted.
Corporate governance
Corporate governance as such is an important instrument for the ongoing improvement of management of the real estate company and for the safeguarding of the shareholders' interest.
Debt ratio
The debt ratio is calculated as the ratio of all obligations (excluding provisions, deferred charges and accrued income) excluding the negative variations in the fair value of the hedging instruments in relation to the total of the assets. The calculation method of the debt ratio is in accordance with Article 13 §1 second subparagraph of the Royal Decree of 13 July 2014. In this Royal Decree, the maximum debt ratio for the real estate company is set at 65%.
Diluted net result per share
The diluted net result per share is the net result as published in the income statement, divided by the weighted average of the number of shares adapted before the effect of potential ordinary shares that result in dilution.
Interim statement by the supervisory board for the third quarter of 2021
Antwerp, 8 November 2021 Regulated information Embargo until 08.11.2021, 6:00 p.m.
EPRA and EPRA terminology 1
EPRA (European Public Real Estate Association) is an organisation that promotes, helps develop and represents the European listed real estate sector, both in order to boost confidence in the sector and increase investments in Europe's listed real estate.
In October 2019 the EPRA's Reporting and Accounting Committee published an update of the report entitled Best Practices Recommendations ('BPR')1 . This BPR contains the recommendations for defining the main financial performance indicators applicable to the real estate portfolio. A number of these indicators are regarded as alternative performance criteria in accordance with the ESMA guidelines. The numerical reconciliation of these alternative performance criteria can be found hereafter. The alternative performance measures are calculated on the basis of the company's consolidated annual accounts.
| EPRA earnings ★ | Result derived from the strategic operational activities. |
|---|---|
| EPRA Net Asset Value (NAV) indicators★ |
(i) EPRA Net Reinstatement Value (NRV) provide an estimation of the value required to rebuild the company through the investment markets based on its current capital and financing structure, including real estate transfer taxes. (ii) EPRA Net Tangible Assets (NTA) assumes that the company buys and sells assets, thereby crystallising certain levels of unavoidable deferred tax. (iii) The EPRA Net Disposal Value (NDV) represents the value accruing to the company's shareholders under an asset disposal scenario, resulting in the settlement of deferred taxes, the liquidation of financial instruments and the recognition of other liabilities for their maximum amount, net of any resulting tax. |
| EPRA Net Initial Yield (NIY) | Annualised gross rental income based on the contractual rents passing as at the closing date of the annual accounts, less the property charges, divided by the market value of the portfolio, increased by the estimated transaction rights and costs resulting from the hypothetical disposal of investment properties. |
| EPRA topped-up NIY | This measure incorporates an adjustment to the EPRA NIY in respect of the expira tion of rent-free periods (or other unexpired lease incentives such as discounted rent periods and step rents). |
| EPRA vacancy rate | Estimated market rental value (ERV) of vacant space divided by ERV of the whole portfolio available upon rental. |
| EPRA cost ratio (including direct vacancy costs)★ |
EPRA costs (including direct vacancy costs) divided by gross rental income less compensations for leasehold estate and long-lease rights. |
| EPRA cost ratio (excluding direct vacancy costs)★ |
EPRA costs (excluding direct vacancy costs) divided by gross rental income less compensations for leasehold estate and long-lease rights. |
| EPRA net rental growth based on an unchanged portfolio composition★ |
Is also referred to as EPRA Like-for-like Net Rental Growth. EPRA net rental growth based on an unchanged portfolio composition compares the growth of the net rental growth of the investment properties not being developed for two full years preceding the financial year closing date and that were available for rent for the entire period. The like-for-like based changes to the gross rental income provide an insight into the changes to the gross rental income that are not the result of changes to the real estate portfolio (investments, divestments, major renovation works, etc.). |
Regulated information Interim statement by the supervisory board for the third quarter of 2021
Antwerp, 8 November 2021 Embargo until 08.11.2021, 6:00 p.m.
EPRA earnings★
Definition - The EPRA earnings are the operating result before result on portfolio minus the financial result and taxes and excluding changes in fair value of financial derivatives (which are not treated as hedge accounting in accordance with IAS 39) and other non-distributable elements based on the statutory annual account of Intervest Offices & Warehouses nv. This alternative performance measure is calculated on the basis of the company's consolidated annual accounts.
Application - The EPRA earnings measure the result of the strategic operational activities, excluding (i) the changes in fair value of financial assets and liabilities, and (ii) the result on portfolio (the profit or loss on investment properties that may or may not have been realised). This amounts to the result that is directly influenced by the real estate and the financial management of the company, excluding the impact accompanying the volatility of the real estate and financial markets.
| Reconciliation in thousands € | 30.09.2021 | 31.12.2020 | 30.09.2020 | 31.12.2019 |
|---|---|---|---|---|
| Net result | 75.810 | 46.060 | 33.199 | 65.748 |
| Minority interests | -1.972 | -2.629 | 12 | 17 |
| Net result (share Group) | 73.838 | 43.431 | 33.211 | 65.765 |
| Eliminated from the net result (+/-): | ||||
| Result on disposals of investment properties ■ |
-198 | 1.670 | -1.470 | 5.364 |
| Changes in fair value of investment properties ■ |
-45.924 | 15.454 | -9.958 | 22.307 |
| Other result on portfolio ■ |
5.943 | -9.083 | 5.347 | -5.661 |
| Changes in fair value of financial assets and ■ liabilities |
-1.771 | -2.311 | 2.345 | -3.065 |
| Minority interests regarding the above ■ |
1.878 | -2.654 | 0 | 0 |
| EPRA earnings | 33.766 | 40.355 | 29.475 | 46.820 |
EPRA earnings per share based on the weighted average number of shares★
Definition - The EPRA earnings per share are the EPRA earnings divided by the weighted average number of shares. This alternative performance measure is calculated on the basis of the consolidated annual accounts of the company.
Application - The EPRA earnings per share measure the EPRA earnings per weighted average number of shares and make it possible to compare these with the gross dividend per share.
| Reconciliation | 30.09.2021 | 31.12.2020 | 30.09.2020 | 31.12.2019 | |
|---|---|---|---|---|---|
| EPRA earnings (in thousands €) | A | 33.766 | 40.355 | 29.475 | 46.820 |
| Weighted average number of shares | B | 25.875.874 | 25.164.126 | 25.051.126 | 24.516.858 |
| EPRA earnings per share (in €) | =A/B | 1,30 | 1,60 | 1,18 | 1,91 |
Interim statement by the supervisory board for the third quarter of 2021
Antwerp, 8 November 2021 Regulated information Embargo until 08.11.2021, 6:00 p.m.
EPRA Net Asset Value (NAV) indicators
Definition - Net Asset Value (NAV) adjusted in accordance with the Best Practice Recommendations (BPR) Guidelines published by EPRA in October 2019 for application as from 2020.
Application - Makes adjustments to the NAV per the IFRS financial statements to provide stakeholders with the most relevant information on the fair value of the assets and liabilities of a real estate investment company, under three different scenarios:
- 〉 The EPRA Net Reinstatement Value (NRV) provide an estimation of the value required to rebuild the company through the investment markets based on its current capital and financing structure, including real estate transfer taxes.
- 〉 The EPRA Net Tangible Assets assumes (NTA) that the company buys and sells assets, thereby crystallising certain levels of unavoidable deferred tax.
- 〉 The EPRA Net Disposal Value (NDV) represents the value accruing to the company's shareholders under an asset disposal scenario, resulting in the settlement of deferred taxes, the liquidation of financial instruments and the recognition of other liabilities for their maximum amount, net of any resulting tax.
For the sake of comparison with data published in the past, the EPRA NAV and EPRA NNNAV, concepts abandoned by the BPR Guidelines, are still published.
| in thousands € | 30.09.2021 | ||
|---|---|---|---|
| EPRA NRV | EPRA NTA | EPRA NDV | |
| IFRS Equity attributable to shareholders of the parent company | 597.961 | 597.961 | 597.961 |
| Diluted NAV at fair value | 597.961 | 597.961 | 597.961 |
| To be excluded: | 29.416 | 28.004 | 0 |
| Deferred tax in relation to the revaluation at fair value of investment ■ properties |
22.469 | 21.446 | |
| Fair value of financial instruments ■ |
6.947 | 6.947 | |
| Intangibles assets as per the IFRS balance sheet ■ |
-389 | ||
| To be added: | 46.369 | 0 | -1.741 |
| Fair value of debt with fixed interest rate ■ |
-1.741 | ||
| Real estate transfer tax ■ |
46.369 | ||
| NAV | 673.745 | 625.965 | 596.220 |
| Diluted number of shares | 26.300.908 | 26.300.908 | 26.300.908 |
| NAV per share (in €) | 25,62 | 23,80 | 22,67 |
| in thousands € | 31.12.2020 | ||
|---|---|---|---|
| EPRA NRV | EPRA NTA | EPRA NDV | |
| IFRS Equity attributable to shareholders of the parent company | 547.218 | 547.218 | 547.218 |
| Diluted NAV at fair value | 547.218 | 547.218 | 547.218 |
| To be excluded: | 24.407 | 23.928 | 0 |
| Deferred tax in in relation to the revaluation at fair value of invest ■ ment properties |
15.656 | 15.656 | |
| Fair value of financial instruments ■ |
8.751 | 8.751 | |
| Intangible assets as per the IFRS balance sheet ■ |
-479 | ||
| To be added: | 42.394 | 0 | -2.180 |
| Fair value of debt with fixed interest rate ■ |
-2.180 | ||
| Real estate transfer tax ■ |
42.394 | ||
| NAV | 614.019 | 571.146 | 545.038 |
| Diluted number of shares | 25.500.672 | 25.500.672 | 25.500.672 |
| NAV per share (in €) | 24,08 | 22,40 | 21,37 |
Regulated information Interim statement by the supervisory board for the third quarter of 2021
Antwerp, 8 November 2021 Embargo until 08.11.2021, 6:00 p.m.
Estimated rental value (ERV)
The estimated rental value is the rental value determined by the independent property experts.
Fair value of an investment property
This is equal to the amount at which a building could be exchanged between well-informed parties, in agreement and acting in conditions of normal competition. From the seller's point of view, this must be understood as subject to deduction of registration fees and any costs.
Specifically, this means that the fair value of the investment properties is equal to the investment value divided by 1,025 (for buildings with a value of more than € 2,5 million) or the investment value divided by 1,10/1,125 (for buildings with a value of less than € 2,5 million). For the investment properties of Intervest located in the Netherlands and kept through the Dutch subsidiaries, this means that the fair value of the investment properties is equal to the investment value divided by 1,07.
Free float
Free float is the percentage of shares owned by the public. According to the EPRA and Euronext definition it concerns all shareholders possessing individually less than 5% of the total number of shares.
Gross dividend yield
The gross dividend yield is the gross dividend divided by the share price on closing date.
Institutional regulated real estate company (IRREC)
The institutional RREC is stipulated in the Act of 12 May 2014 concerning regulated real estate companies, as amended from time to time (the RREC Act) and in the Royal Decree of 13 July 2014 concerning regulated real estate companies, as amended from time to time (the RREC Royal Decree). It is a lighter form of the public RREC. It offers the RREC the possibility to extend specific tax aspects of its system to its perimeter companies and to realise partnerships and specific projects with third parties.
Interest coverage ratio
The interest coverage ratio is the ratio between the operating result before result on portfolio and the financial result (excluding the changes in fair value of financial derivatives).
Intervest
Intervest is the abridged name for Intervest Offices & Warehouses, the full legal name of the company.
Investment value of a real estate property
This is the value of a building estimated by the independent property expert, and including the transfer costs without deduction of the registration fees. This value corresponds to the formerly used term "value deed in hand".
Liquidity of the share
Ratio of the number of traded shares on one day and the number of shares.
Regulated information Interim statement by the supervisory board for the third quarter of 2021
Antwerp, 8 November 2021 Embargo until 08.11.2021, 6:00 p.m.
Net dividend
The net dividend equals the gross dividend after deduction of 30% withholding tax. The withholding tax on dividends of public regulated real estate companies amounts to 30% (except in case of certain exemptions) as a result of the Programme Act of 25 December 2016, published in the Belgian Official Gazette of 29 December 2016.
Net dividend yield
The net dividend yield is equal to the net dividend divided by the share price on closing date.
Net result per share (Group share)★
Definition - The net result per share (Group share) is the net result as published in the income statement, divided by the weighted average number of shares (i.e. the total amount of issued shares less the own shares) during the financial year. This alternative performance measure is calculated on the basis of the company's consolidated annual accounts.
| Reconciliation | 30.09.2021 | 31.12.2020 | 30.09.2020 | 31.12.2019 | |
|---|---|---|---|---|---|
| Net result (Group share) (in thousands €) |
A | 73.838 | 43.431 | 33.211 | 65.765 |
| Weighted average number of shares | B | 25.875.874 | 25.164.126 | 25.051.126 | 24.516.858 |
| Net result - Group per share (in €) | =A/B | 2,85 | 1,73 | 1,33 | 2,68 |
Net value (fair value) per share
Total shareholders' equity attributable to the equity holders of the parent company (therefore, after deduction of the minority interests) divided by the number of shares at the end of the year (possibly after deduction of own shares). It corresponds to the net value as defined in article 2, 23° of the RREC Act.
The net value (fair value) per share measures the value of the share based on the fair value of the investment properties and makes it possible to make a comparison with the stock exchange quotation.
Net value (investment value) per share★
Definition - Total shareholders' equity attributable to the equity holders of the parent company (therefore, after deduction of the minority interests) increased with the reserve for the impact on the fair value of estimated transaction rights and costs resulting from the hypothetical disposal of investment properties, divided by the number of shares at the end of the year (possibly after deduction of own shares). This alternative performance measure is calculated on the basis of the company's consolidated annual accounts.
Application - The net value (investment value) per share measures the value of the share based on the investment value of the investment properties and makes it possible to make a comparison with the stock exchange quotation.
Interim statement by the supervisory board for the third quarter of 2021
Antwerp, 8 November 2021 Regulated information Embargo until 08.11.2021, 6:00 p.m.
| Reconciliation | 30.09.2021 | 31.12.2020 | 30.09.2020 | 31.12.2019 | |
|---|---|---|---|---|---|
| Shareholders' equity attributable to the shareholders of the parent company (in thousands €) |
A | 597.961 | 547.218 | 536.876 | 523.859 |
| Reserve for the impact on fair value of estimated transaction rights and costs resulting from the hypothetical disposal of investment properties (in thousands €) |
B | 41.859 | 30.210 | 30.210 | 28.404 |
| Shareholders' equity attributable to the shareholders of the parent company - investment value (in thousands €) |
C=A+B | 639.820 | 577.428 | 567.086 | 552.263 |
| Number of shares at year-end | D | 26.300.908 | 25.500.672 | 25.500.672 | 24.657.003 |
| Net value (investment value) per share (in €) |
=C/D | 24,33 | 22,64 | 22,24 | 22,40 |
Net yield
The net yield is calculated as the ratio of the contractual rent, increased by estimated rental value on vacancy, less the allocated property charges, and the fair value of investment properties available for rent.
Occupancy rate
The occupancy rate is calculated as the ratio between the estimated rental value (ERV) of the rented space and the estimated rental value of the total portfolio available for rent as at closing date.
Operating margin★
Definition - The operating margin is the operating result before result on portfolio, divided by the rental income. This alternative performance measure is calculated on the basis of the company's consolidated annual accounts.
Application - The operating margin provides an indication of the company's possibility of generating profit from its operational activities, without taking the financial result, the taxes or the result on portfolio into account.
| Reconciliation in thousands € | 30.09.2021 | 31.12.2020 | 30.09.2020 | 31.12.2019 | |
|---|---|---|---|---|---|
| Operating profit before result on portfolio |
A | 39.754 | 48.918 | 35.780 | 55.891 |
| Rental income | B | 48.534 | 61.303 | 45.396 | 66.143 |
| Operating margin (%) | =A/B | 82% | 80% | 79% | 85% |
Regulated real estate company (RREC)
The status of regulated real estate company is regulated by the Act of 12 May 2014 on regulated real estate companies, as modified from time to time (RREC Act) and by the Royal Decree of 13 July 2014 on regulated real estate companies, as modified from time to time (RREC Royal Decree) in order to stimulate joint investments in real estate properties.
Result on portfolio and result on portfolio (Group share)★
Definition - The result on portfolio comprises (i) the result on disposals of investment properties, (ii) the changes in fair value of investment properties, and (iii) the other result on portfolio. This alternative performance measure is calculated on the basis of the company's consolidated annual accounts.
Interim statement by the supervisory board for the third quarter of 2021
Antwerp, 8 November 2021 Regulated information Embargo until 08.11.2021, 6:00 p.m.
Application - The result on portfolio measures the realised and non-realised profit and loss related to the investment properties, compared with the valuation of the independent property experts at the end of previous financial year.
| Reconciliation in thousands € | 30.09.2021 | 31.12.2020 | 30.09.2020 | 31.12.2019 |
|---|---|---|---|---|
| Result on disposals of investment properties | 198 | 1.670 | 1.470 | 5.364 |
| Changes in fair value of investment properties | 45.924 | 15.454 | 9.958 | 22.307 |
| Other result on portfolio | -5.943 | -9.083 | -5.347 | -5.661 |
| Result on portfolio | 40.179 | 8.041 | 6.081 | 22.010 |
| Minority interests | -1.878 | -2.654 | 0 | 0 |
| Result on portfolio (Group share) | 38.301 | 5.387 | 6.081 | 22.010 |
Return of a share
The return of a share in a certain period is equal to the gross return. This gross return is the sum of (i) the difference between the share price at the end and at the start of the period and (ii) the gross dividend (therefore, the dividend before deduction of the withholding tax).
RREC Act
The Act of 12 May 2014 on regulated real estate companies.
RREC Legislation
The RREC Act and the RREC Royal Decree.
RREC Royal Decree
The Royal Decree of 13 July 2014 on regulated real estate companies.
Specialised real estate investment fund (SREIF)
The Specialised Real Estate Investment Fund falls under the Royal Decree of 9 November 2016 with regard to specialised real estate investment funds. This system allows real estate investments in flexible and efficient funds.
Turnover rate
The turnover rate of a share is calculated as the ratio of the number of shares traded per year, divided by the total number of shares as at the end of the period.
Yield
Yield is calculated as the ratio of contractual rents (whether or not increased by the estimated rental value of unoccupied rental premises) and the fair value of investment properties available for rent. It concerns a gross yield, without taking into account the allocated costs.
Interim statement by the supervisory board for the third quarter of 2021
Antwerp, 8 November 2021 Regulated information Embargo until 08.11.2021, 6:00 p.m.
Photo cover: Herentals 〉 Herentals Green Logistics - Artist's impression
DisClaimER
Intervest Offices & Warehouses, having its registered office at Uitbreidingstraat 66, 2600 Antwerp (Belgium), is a public Regulated Real estate company, incorporated under Belgian law and listed on Euronext Brussels.
This press release contains forward-looking information, forecasts, beliefs, opinions and estimates prepared by Intervest Offices & Warehouses, relating to the currently expected future performance of Intervest Offices & Warehouses and the market in which Intervest Offices & Warehouses operates.
By their very nature, forward-looking statements involve inherent risks, uncertainties and assumptions, both general and specific, and risks exist that the forward-looking statements will not be achieved. Investors should be aware that a number of important factors could cause actual results to differ materially from the plans, objectives, expectations, estimates and intentions expressed in, or implied by, such forward looking statements. Such forward-looking statements are based on various hypotheses and assessments of known and unknown risks, uncertainties and other factors which seemed sound at the time they were made, but which may or may not prove to be accurate.
Some events are difficult to predict and can depend on factors on which Intervest Offices & Warehouses has no control. Statements contained in this press release regarding past trends or activities should not be taken as a representation that such trends or activities will continue in the future. This uncertainty is further increased due to financial, operational and regulatory risks and risks related to the economic outlook, which reduces the predictability of any declaration, forecast or estimate made by Intervest Offices & Warehouses.
Consequently, the reality of the earnings, financial situation, performance or achievements of Intervest Offices & Warehouses may prove substantially different from the guidance regarding the future earnings, financial situation, performance or achievements set out in, or implied by, such forward-looking statements. Given these uncertainties, investors are advised not to place undue reliance on these forward-looking statements. Additionally, the forward-looking statements only apply on the date of this press release. Intervest Offices & Warehouses expressly disclaims any obligation or undertaking, unless if required by applicable law, to release any update or revision in respect of any forward-looking statement, to reflect any changes in its expectations or any change in the events, conditions, assumptions or circumstances on which such forward-looking statements are based. Neither Intervest Offices & Warehouses, nor its representatives, officers or advisers, guarantee that the assumptions underlying the forward-looking statements are free from errors, and neither of them makes any representation, warranty or prediction that the results anticipated by such forward-looking statements will be achieved.