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Covivio — Interim / Quarterly Report 2014
Feb 20, 2015
1222_iss_2015-02-20_1818b427-a2f7-4e45-be75-ce59cf215ef5.pdf
Interim / Quarterly Report
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FONCIERE DES REGIONS
Co-créateur d'histoires immobilières
€16,4 billion portfolio1
« 2014 good results reflect the success of our ongoing strategy in portfolio quality enhancement. 2015 outlook is positive with investment committed for already €1 billion including a major transaction in Hotel real estate ». Christophe Kullmann, CEO of Foncière des Régions
2014 results – Enhanced strategic positioning
Reinforcement of the real estate positioning
- Offices: acceleration of investments in the pipeline
- German Residential: reinforcement of the exposure on a buoyant market
- Hotels: diversification of our partners and our investment tools
- Exit from Logistics
Sound 2014 results
- Occupancy rate up to 97.1%
- Stability of firm lease terms (5.8 years)
- Increase in the value of the portfolio (+2.1% on a like-for-like basis)
- Recurring Net Income (RNI) EPRA up 6% at €315 million (5.03€ per share)
- EPRA NAV of €75.5 per share
Major investment in Hotel real estate at the beginning of 2015
- Acquisition on February 2015 of a 14.6% stake in Foncière des Murs at 23€
- Launch of a takeover bid on Foncière des Murs that can reach 9.2% of the share capital, considering the commitment not to contribute
- Capital increase of Foncière des Régions of €250 million contemplated
Outlook
- Dividend of €4.30 per share2 , up by 2.4%
- €1 billion in investments already committed in 2015
- Objective of a slight increase in the EPRA Recurring Net Income per share for 2015
1 Group share €9.8 bn
2 Will be put to the vote by the General Meeting on 17 April 2015
The financial statements were approved by the Board of Directors on 19 February 2014. The audit on consolidated financial statements was
conducted. The audit report will be issued after completion of specific checks.
A strengthened real estate positioning
Foncière des Régions now holds a portfolio of €16.4 billion (€9.8 billion Group share) focused on the Office sector, leased to large companies, including two areas of diversification on strong and buoyant markets, which are Residential in Germany and Hotels / Service sector. Foncière des Régions relies on a partnership strategy with a leasing base made up of blue chip companies (Suez Environnement, Thales, Dassault Systèmes, Orange, EDF, IBM, Eiffage, Accor, Telecom Italia, etc.).
.................................................................................................................................................................
Sucessful strategies of 2014 have strengthened this real estate positioning and confirmed the permanence of the cash-flows:
- in the Office sector, with €351 million, Foncière des Régions has accelerated investments in its pipeline and continued its strategy of selective acquisitions;
- in German Residential, the group has enhanced its exposure with €358 million of acquisitions (€218 million Group share), mainly in prime locations in Berlin;
- in Hotel real estate, the year has been marked by geographic diversification and the set up of new partnerships. In addition, with the creation of FDM Management, Foncière des Régions is now also in possession of a tool to accompany operators in their strategic shift through investments in premises and businesses.
Foncière des Régions has posted a record volume of non-strategic asset disposals, with the sale of €986 million Group share, including €606 million in Logistics. The portfolio, now comprising 91% in strategic assets, has sound strong points and posts an occupancy rate of 97.1%, as well as an average firm lease term of 5.8 years.
Real estate activity in 2014: rents up by 6%
.........................................................................................................................................................
- Rental income on like-for-like basis: +0.2%
- Occupancy increase: 97.1% (+1.1 point)
- Stability of average firm lease term: 5.8 years (stable)
- Increase of values like-for-like: +2.1%
With the increase in Germany, and despite the impact of sales, rents were at €558.1 million Group share, up by 6% and by 0.2% at constant scope.
| Rental income $(\mathfrak{m})$ |
Change on like- for-like basis |
Occupancy rate |
Residual firm terms of leases |
|
|---|---|---|---|---|
| Offices - France | 238.2 | $+0.7%$ | 96.8% | 5.4 years |
| Offices - Italy | 114.9 | $-1.5\%$ | $95.2\,\%$ 1 | 6.3 years |
| Offices | 353.1 | $+0.0%$ | 96.3% | 5.7 years |
| Residential Germany | 103.4 | $+1.8%$ | 98.3% | Na |
| Hotels/Service Sector | 51.0 | $-0.6%$ | 100% | 6.8 years |
| Other | 50.7 | Na | Na | Na |
| Total | 558.1 | $+0.2%$ | 97.1% | 5.8 years |
| Indexation: +0.6% Occupancy rate: - 0.3% Renewals: -0.1% |
1 Core portfolio |
Offices in France: Growth of indicators
(€5.0 billion portfolio at 100%; €4.4 billion Group share)
- Rise in occupancy rate: 96.8% (+1.0 point)
- Firm lease maturity: 5.4 years
- Growth of rents like-for-like: +0.7%
- Growth of values like-for-like: +3.0%
- Objective of 50% green portfolio achieved one year early (+9.0 points)
- Pipeline: €1.4 billion, including €518 million committed
Successful lettings have increased the occupancy to a record level of 96.8% (compared with 95.8% at the end of 2013). Over the year, this means more than €50 million Group share of leases (20% of rents) which were signed or renewed for a mean firm term of 6.1 years. In particular, 11,400 m² have been let in the Tour CB 21, now 97% leased. With signatures in 2014, the average firm lease term remains high at 5.4 years.
Foncière des Régions has accelerated its investments borne by the projects pipeline in Offices France, now standing at €1.4 billion. Almost €518 million of projects are now committed, €309 million of which will be delivered in 2015, for more than €36 million of annual rents (yield on cost above 7%). Committed projects relate mainly to property redevelopments and leasing turnkey projects and enjoy a prelet rate of almost 2/3.
With the strength of its partnership model, Foncière des Régions, alongside Crédit Agricole Assurances, has delivered the New Velizy campus in the heart of the Vélizy-Meudon district. This 46,000 m² asset is leased to Thales for a fixed term of 9 years. In addition, Foncière des Régions signed the 13,100 m² extension of the Dassault Systèmes Campus and the extension of the lease for 12 years firm (total rent more than €24 million and €12 million Group share). Turnkey projects have also been signed with Schlumberger for 3,150 m² in Montpellier and with Bose for 5,100 m² in Saint-Germain-en-Laye.
As part of its selective acquisitions strategy, the group has entered into a new partnership with the acquisition from Natixis of the "Liberté et Coupole" property complex, with an area of 38,000 m² at Charenton-le-Pont, on the Liberté metro station. This investment of €162 m, duties included, was made on the basis of a yield of 6.5%. Natixis has signed a new triple net firm lease of 9 years, without incentive.
Foncière des Régions has continued the qualitative rotation of its portfolio, through the sale of €137 million of non-core or mature assets, for an average margin of 7% on the last appraisal value. This dynamic rotation of assets has contributed to the improvement of the France Offices portfolio. Therefore, almost 50% of the current France Offices portfolio has been acquired or developed in the last five years.
The year was marked by a rise in values on like-for-like basis of 3.0%, supported by compression of yield rates in Ile-de-France and in the regional cities of France. Worthy of note is the gain of 8% on projects currently in development.
Offices Italy: sound foundations
(€4.1 billion portfolio at 100%; €2.0 billion Group share)
- High occupancy rate: 95.2% (Core portfolio)
- Average firm lease term: 6.3 years (Core portfolio)
- Rents like-for-like: 1.5% (- 0.3% excluding release in Turin)
- Resistance of values 0.2% like-for-like (stability across the Core portfolio)
Foncière des Régions operates in Italy through its subsidiary Beni Stabili, 1st Italian property development company, having a high quality portfolio, with 90% located in Northern and Central Italy, in particular Milan and Rome. This positioning maintains sound real estate indicators, with 95.2% occupancy for an average firm lease term of 6.3 years (across the Core portfolio).
Leasing activity has been highlighted by the success of restructurings and renovations, marketed at high leasing values. The San Fedele asset in Milan has thus been leased at 100%. The San Nicolao development (Milan, 11,700 m²), was let before its delivery to the Luxottica Group for 7 years firm and a rent of €5.4 m. The asset in Via dell'Arte (Rome, 6,400 m²), delivered in the 1st half, is leased with 93% occupancy. Almost 24,000 m² has also been renewed with a rise in rents of 14%.
Qualitative rotation of the portfolio has continued with a sale of €81 million worth of assets (€39 million Group share), with a margin of 3.3% on last appraisal value.
Rents have fallen by 1.5% on like-for-like basis due to the vacancy of the Corso Ferrucci asset (Turin, 51,000 m²), which was actively marketed. Finally, the positioning of the portfolio covering Core zones has allowed stability of appraisal values in 2014 (-0.2% like-for-like).
Germany Residential: acceleration of investments
(€2.7 billion at 100%; €1.7 billion Group share)
- Very high occupancy rate: 98.3%
- Rent growth like-for-like: +1.8%
- Rise in values like-for-like: +2.9%
With operations in Germany since 2005, Foncière des Régions has improved its exposure in the German Residential market during 2013 and now has a direct holding of 60.9% in its Imméo subsidiary. The group enjoys an exposure of 17% of its portfolio in German Residential and a €1.7 billion Group share (compared with €0.8 billion in 2012) through 41,400 residential housing units.
The year has been highlighted by the acceleration of investments with €358 million (€218 million Group share) acquired in Berlin, Dresden and Leipzig. The group is concentrating its investments on small size but prime downtown assets, combining reversionary potential (25-30%) and long term sale potential. At the same time, €160 million (€97 million Group share) of assets have been sold or have been the subject of disposal agreements in NRW (with a mean margin of 5.4% on the appraisal at the end of 2013). These rotations have continued the qualitative recentring on target locations, which accounted for 84% of the portfolio at the start of 2015 (compared with 63% at end 2012).
This strategy in Germany is confirmed by the good indicators for the year. Rents have grown by 1.8% at constant scope, including 4.9% in Berlin and Dresden, and occupancy rate remains very high at 98.3%. Second, the value of the portfolio has grown by 2.9% at constant scope (average yield 6.5%), including 4.9% in Berlin and Dresden.
Hotels and Service sector: leader in Europe
(€3.0 billion portfolio at 100%; €0.8 billion Group share)
- Occupancy held at 100%
- Average firm lease term: 6.8 years
- Strength of leases like-for-like: 0.6%
- Growth of values like-for-like: +2.0%
Europe's leader in hotel real estate, Foncière des Régions relies on long term partnerships with major players in the hotel sector (Accor, Louvre Hotels and B&B Hôtels). The year was highlighted by three successes:
- Partner diversification with the signature of partnerships with NH Hotels Group, Motel One and Meininger;
- Geographic diversification through the acquisition of NH 4* Amsterdam and new investments in Germany;
- Diversification of investment tools with the creation of FDM Management. The group has been given the means to accompany its operator strategy growth, by being able to invest in premises and businesses. FDM Management has already signed the acquisition in 2014 of 9 hotels in Germany, managed by Louvre Hotels Group and the development for Accor of a Pullman hotel at Roissy.
Rents have held firm on like-for-like basis (-0.6%) and experienced an improvement over the 2nd part of the year. Income from the Accor hotels, variable according to revenues, fell by only 1.1% despite the 3 point rise in VAT.
At the end of 2014, the value of the portfolio rose by 2.0% at constant scope (average return 6.1%), sustained by the growth in value of the hotels of 2.8%.
Growth in the Recurring Net Income and the dividend
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Liabilities secured
During 2014, Foncière des Régions continued to improve the quality of its liabilities by refinancing or by issuing debt securities amounting to €3.1 billion (€1.9 billion Group share), of which 32% was raised on the bond market. Beni Stabili, the Italian subsidiary of Foncière des Régions, has in particular successfully refinanced the ImSer debt, related to the portfolio of €1.7 billion in Telecom Italia assets (cost of new loans 2.5%). This refinancing has been accompanied by a capital increase of €150 million, followed by Foncière des Régions, which now holds 48.3% of the capital.
The group has thus improved the diversification of its debt and maintained an average maturity of more than 4 years. Foncière des Régions indebtedness has remained controlled with a stable LTV, at 46.1% (compared with 46.5% at the end of 2013). Satisfactory operational performance and a reduction of the average cost of the debt has improved the ICR to 2.8, compared with 2.5 in 2013.
EPRA Recurring Net Income: €314.5 million, +6.0%
The EPRA Recurring Net Income was €314.5 million Group share, up by 6.0% over a year. This good performance results fundamentally from the improvement in German Residential and the fall in the cost of the debt (to 3.29% compared with 3.94% at the end of 2013), despite the impact of disposals in 2013 and 2014.
Per share, the EPRA Recurring Net Income was €5.03/share, slightly up by 1.1% over a year due to the impact of the share issue in the 2nd half of 2013 in connection with the successful exchange offer on FDL.
Growth of the dividend, at €4.30 per share
Given the good performance in 2014 results and the sound outlook, the group will be proposing at the vote of the General Meeting on 17 April next a dividend of €4.30 per share, up by 2.4% compared to last year. This dividend represents a distribution rate of 86% and a yield of 4.6% on the basis of the closing price on 19 February 2015.
EPRA NAV/share: €75.5/share
The EPRA NAV was €4,754 million and €75.5/share, down by 2.8% compared with the end of 2013. The soundness of the Recurring Net Income and the increase in appraisal values have to some extent offset the effect of the distribution, as well as the impacts of the Imser refinancing and restructuring of the hedges, which will have a favorable effect on profile and cost of the debt.
The EPRA triple net NAV was set at €4,145 million and €65.9/share, impacted by the fair valuation of the financial instruments and debts.
Major investment in Hotel real estate at the beginning of 2015
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Foncière des Régions to announce the acquisition of a 14.6% stake in Foncière des Murs (FDM) its subsidiary specialising in Hotel real estate, with a portfolio of €3.2 billion. This acquisition will be closed on 23 February with Generali (10.3%) and ACM (4.3%) which will still have 10.3% and 10.0% of the share capital. The price of €23.0 is equivalent to a 1.3% premium on the Triple Net NAV per share. Foncière des Régions will then hold 43.1% of its share capital which, as a limited partner it already consolidates.
Foncière des Régions will also launch a takeover bid for the balance of FDM's capital. The contemplated price is €23 per share (following the delivery of the report of the independent expert that will be appointed by the Supervisory Board of FDM and subject to the decision of conformity of the offer by the AMF). Considering the commitment not to contribute of the main institutional investors, which hold 47.7% of share capital after disposals (Crédit Agricole Assurances, Cardif, Generali and ACM) the stake that can be bought reaches 9.2% of the share capital (€152 million).
Once these transactions have been completed, Foncière des Régions' portfolio will show an additional €430 million to €700 million GS in the Hotels and Service Sector. This enhancement in the attractive Hotel investment market will create value immediately. It will enable to increase the portion of strategic assets and improve financial results visibility (longer lease terms, increased occupancy rate and operating margin).
In order to finance those acquisitions in Hotels and, to a greater extent, its investments and growth projects in each of its asset classes (Offices, Residential, Hotels), Foncière des Régions is contemplating a capital increase of around €250 million3 with preferential subscription rights. The majority shareholders, representing close to 50% of the share capital have already expressed their desire to participate in this.
3 Subject to obtaining the prospectus approved by the AMF
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These sound results confirm the permanence of the cash-flows and robust values. 2014 saw the solidity of the portfolio increase, with focusing on strategic markets, the capacity to capitalise on investment opportunities and improvement of the visibility of the results.
In 2015, Foncière des Régions intends to capitalise on new growth opportunities in its strategic asset classes:
- In Offices, the group intend to invest €300 million mainly in its pipeline. In 2015, 9 projects will be delivered for a cost of €309 million;
- In Germany Residential, which has an organic growth potential, the group aims to invest €500 million in prime acquisitions in strategic locations. Two portfolios have been negotiated already for €221 million;
- In Hotel real estate, Foncière des Régions is increasing its exposure (the operation on FDM represents an investment of €430 million to €700 million of assets) and intends to accelerate investments via three tools (sale and leaseback, developments and acquisitions of premises and businesses). The Group set itself an investment target of over €400 million (€200 million GS).
To date, already €1 billion of investments are committed. The strategy of portfolio quality enhancement will also continue thanks to the pursue of disposals with a €700 million program.
Backed by its sound outlook, for 2015, Foncière des Régions targets more than 95% of its portfolio in its strategic markets and is anticipating a slight increase in its EPRA Recurring Net Income per share.
Today, there will be a conference call devoted to analysts and investors
at 2:30 p.m. (Paris time)
The presentation relating to the conference call will be available
on the Foncière des Régions website: www.foncieredesregions.fr/finance
Financial calendar:
Revenues 1Q 2015: 6 May 2015
Contacts:
Media Relations Géraldine Lemoine Tel.: + 33 (0)1 58 97 51 00
Investor Relations Paul Arkwright Tel.: + 33 (0)1 58 97 51 85
Appendix:
| €m | Value 2014 Total share |
Value 2014 GS |
Change LFL 12 months |
Change % LFL 6 months |
Yield ED 2014 GS |
|---|---|---|---|---|---|
| Offices - France | 5,032 | 4,353 | $3.0\%$ | 1.8% | 6.6% |
| Offices - Italy | 4,093 | 1,977 | $-0.2\%$ | $0.1\%$ | $6.1\%$ 1 |
| Offices | 9 1 2 5 | 6,330 | $2.0\%$ | 1.2% | 6.4% |
| Residential Germany | 2,746 | 1,656 | $2.9\%$ | $1.5\%$ | 6.5% |
| Hotels/Service Sector | 3,243 | 844 | $2.0\%$ | 1.5% | 6.1% |
| Other | 1,318 | 922 | Na | Na | Na |
| Total | 16,433 | 9,752 | 2.1% | $1.2\%$ | 6.3% |
Portfolio Group Share
EPRA NAV evolution
Simplified income statement (Group share)
| $\epsilon$ m | 2013 | 2014 | % |
|---|---|---|---|
| Rental income | 525.7 | 558.1 | |
| $o/w$ net rental income | 483.8 | 508.5 | $+5.1\%$ |
| Net operating costs | $-42.7$ | $-54.2$ | |
| Result from other activities | 14.4 | 21.2 | |
| Current operating income | 455.8 | 475.5 | $+4.3%$ |
| Net cost of financial debt | $-190.4$ | $-173.5$ | |
| Recurring net income of MEE companies | 23.4 | 14.2 | |
| Income from non-consolidated companies | 10.1 | 0.9 | |
| Pre-tax net income | 298.9 | 317.2 | $+6.1%$ |
| Recurring tax | $-2.2$ | $-2.7$ | |
| EPRA recurring net income | 296.7 | 314.5 | $+6.0%$ |
Foncière des Régions, co-créateur d'histoires immobilières
A reference player in service sector property, Foncière des Régions has built its development and its portfolio around one key characteristic value, that of partnership. With a total portfolio of €16.4 billion € (€9.8 billion Group share) located on buoyant markets, which are France, Germany and Italy, Foncière des Régions is now an acknowledged partner for businesses and regions, which it accompanies in their real estate strategy with a dual objective: To enhance the existing urban portfolio and design real estate for the future.
Foncière des Régions is committed principally to its Key Accounts (Orange, Suez Environnement, Edf, Dassault Systèmes, Thales, Eiffage, etc.) on the Offices market. The group also focuses its attention, in a pioneering and relevant manner, on two other strategic sectors, which are German Residential and Hotels in Europe.
The Foncière des Régions security is listed in sub-fund A of Euronext Paris (FR0000064578 - FDR), a member of the SRD and features in the composition of the MSCI, SBF120, Euronext IEIF "SIIC France" and CAC Mid100 indices, in the European property benchmark indices "EPRA" and "GPR 250" as well as in the FTSE4 Good, DJSI World and NYSE Euronext Vigeo (World 120, Eurozone 120, Europe 120 and France 20) ethical indices.
Foncière des Régions is rated BBB-/Stable by Standard and Poor's.
| 1. Major transactions | 13 |
|---|---|
| 2. Business analysis elements (GS) |
16 |
| 3. Analysis by segment |
22 |
| 4. Financial elements | 47 |
| 5. Net Asset Value |
53 |
| 6. Financial resources | 55 |
| 7. Financial indicators of subsidiaries |
60 |
| 8. Glossary | 61 |
- Major transactions Annual results
1. Major transactions during the period
November 2014 – Delivery of the New Campus Velizy (46,000 m²) leased to Thales for 9 years firm (€192 million co-investment with Crédit Agricole Assurances)
FDR diverse partner base by signing with NH Hotels Group, Motel One and Meininger
October 2014 - FDR completes its acquisition of €240 million housing units in Berlin and Dresden and signs €26 million of new acquisitions in Berlin
Mars 2014 - FDR signed the sale of €473 million of assets Logistics and €107 million of promises to end of 2014
| | January 2014 |
|
|---|---|---|
| Foncière des Régions and Crédit Agricole Assurances acquired the Campus Eiffage |
||
| | February 2014 |
|
| Foncière des Régions supports B&B in its European expansion effort |
||
| Foncière des Régions: new leases for 3,600 sqm in the CB 21 Tower at La Défense |
||
| | March 2014 |
|
| Foncière des Régions accelerates its strategic refocusing by selling nearly 60% of its logistics assets for €473 million |
||
| | June 2014 |
|
| Foncière des Régions acquires the "NH Amsterdam Centre" hotel**** from the NH Hotel Group |
||
| Foncière des Régions continues to strengthen its positioning on the German residential market |
||
| Euromed Center: first stone laid of the Golden Tulip Hotel**** |
||
| B&B Hotel Paris Porte des Lilas inauguration | ||
| | July 2014 |
|
| Foncière des Régions and Demathieu & Bard Immobilier build the future headquarters of Bose France in St-Germain-en-Laye |
||
| | September 2014 |
|
| Foncière des Régions has successfully priced a € 500 million 7-year bond issue |
||
| Foncière des Régions awarded for the quality of its financial and extra-financial reporting , with Reference Document 2013 and Sustainable Developement Report 2013 |
||
| | October 2014 |
New rental partnership for Foncière des Régions with Natixis
Foncière des Régions pursue its German Residential Strategy
November 2014 Foncière des Régions and Crédit Agricole Assurances deliver the New Vélizy campus to Thales Foncière des Murs : Success of Capital increase about €200 million December 2014 Foncière des Régions and MEININGER Hotels agree a strategic investment partnership Foncière des Régions announces the création of FDM Management January 2015 Foncière des Régions continues investing in Residential in Germany February 2015
Foncière des Régions enters into a new hotel partnership with Motel One
2. Business analysis
Foncière des Régions increased its stake in Foncière Développement Logements following the Public Exchange Offer (PEO) in August 2013. At the close of the PEO, Foncière des Régions held 59.7% of Foncière Développement Logements, which, as from 1 August 2013, is fully consolidated. In this way, the P&L was impacted for 5 months of the Residential business in 2013 compared with 12 months in 2014.
Also, following the France and Germany activities split done in July 2014, Foncière des Régions directly holds 60.9% of the German portfolio and Foncière Développement Logements holds 61.26% of it.
On 27 October, Foncière des Régions participated in the capital increase of Beni Stabili, and it now holds 48.3% of Beni Stabili's capital.
Foncière des Régions increased its equity interest in Foncière des Murs following capital increase in November 2014, and it now owns 28.46% of Foncière des Murs.
| 100% | Group Share | |||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| $(\epsilon$ million) | 2013 | 2014 | Change $($ %) |
2013 | 2014 | Change (9/6) |
Change $($ %) $LFL*$ |
$%$ of re nt |
||
| Offices France | 265,2 | 250,7 | $-5,5%$ | 255.0 | 238,2 | $-6.6%$ | $0.7\%$ | 43% | ||
| Paris | 84.3 | 82.5 | $-2,1%$ | 79.8 | 77.9 | $-2,4%$ | 14 % | |||
| Paris Region | 102.5 | 101.3 | $-1.1%$ | 96.8 | 93.4 | $-3.6%$ | 17% | |||
| Other French regions | 78.5 | 66,9 | $-14,8%$ | 78.4 | 66.9 | $-14,7%$ | 12% | |||
| Offices Italy | 231,7 | 228,7 | $-1,3%$ | 117.9 | 114,9 | $-2,5%$ | $-1,5%$ | 21% | ||
| Core portfolio | 228.4 | 226.0 | $-1,1%$ | 116.2 | 113,5 | $-2,3%$ | 20% | |||
| Dynamic portfolio | 3,3 | 2,7 | $-19.0%$ | 1.7 | 1.3 | $-19,1%$ | 0% | |||
| De velopment portfolio | 0.0 | 0.0 | 0.0% | 0.0 | 0.0 | 0.0% | 0% | |||
| To tal Offices | 496.9 | 479.4 | $-3,5%$ | 372,9 | 353,1 | $-5.3\%$ | 0.0% | 63% | ||
| Hotels and Service sector | 204.0 | 196.1 | $-3.9%$ | 53.0 | 51.0 | $-3,9%$ | $-0.6%$ | 9% | ||
| Hote s | 143.1 | 142.8 | $-0.2\%$ | 35.8 | 35.8 | $0.0\%$ | 6% | |||
| Healthcare | 22.2 | 16.5 | $-25.6%$ | 6.3 | 4.7 | $-25.2%$ | 1% | |||
| Business premises | 38.7 | 36,7 | $-5,1%$ | 10,9 | 10,5 | $-4,1%$ | 2% | |||
| Residential Germany | 63,8 | 171,1 | 168,0% | 37,9 | 103,4 | 173,1% | 1,8% | 19% | ||
| Total Core activities | 764,7 | 846,5 | 10,7% | 463,7 | 507,4 | 9,4% | $0, 2\%$ | 91% | ||
| Other | 67.2 | 61.9 | $-8,0%$ | 62,0 | 50.7 | $-18,1%$ | n a | 9% | ||
| Logistic s | 54,2 | 33.1 | $-39.0%$ | 54,2 | 33,1 | $-39.0%$ | 6 % | |||
| ResidentialFrance | 13,0 | 28,8 | 121,7% | 7,8 | 17,6 | na | 3% | |||
| To tal rent | 832,0 | 908,4 | 9,2% | 525,7 | 558,1 | 6, 2% | $0, 2\%$ | 100% |
A. RECOGNISED RENTAL INCOME: +6.2%
The explanation, like for like (+0.2%), for this improvement lies in the very low indexation over the period, the rent renewals signed in 2013, as well as the maintenance of an occupancy rate above 97.1% at the end of December 2014.
As Group share, rental income totalled €558 million, an increase of 6.2% over the period. The increase was mainly due to the consolidation of the Residential business (+€75 million), and:
- new asset acquisitions and deliveries (+€6.4 million)
- disposals (-€46.2 million, €21.3 million of which was related to disposals in Logistics)
- indexation and the mixed effect from departures and re-lettings (-€0.3 million)
1. Cost to revenue by business
| 1. Cost to revenue by business | |||||||
|---|---|---|---|---|---|---|---|
| Offices France |
Office Italy |
Hotels & Service Sector |
Résidential Germany |
Other | Total | ||
| 2014 | 2014 | 2014 | 2014 | 2014 | 2014 | 2014 | |
| Rental Income | 238,2 | 114,9 | 51,0 | 103,4 | 50,7 | 525,7 | 558,1 |
| Unrecovered property operating coats |
$-5,7$ | $-12,4$ | $-0, 0$ | $-3,0$ | $-6,7$ | $-26,6$ | $-27,9$ |
| Expenses on properties | $-1, 9$ | $-3,7$ | $-0, 0$ | $-9,0$ | $-3,3$ | $-11,4$ | $-17,8$ |
| Net losses on unrecoverable receivable |
$-0,5$ | $-1, 2$ | $-0, 0$ | $-3,3$ | $-0,1$ | $-5,3$ | $-5,1$ |
| Net rental income | 230,2 | 97,6 | 50,9 | 88,0 | 40,6 | 482,4 | 507,3 |
| Cost to revenue ratio | 3,4% | 15,1% | $0,0\%$ | 14,8% | 19,9% | 8,3% | 9,1% |
The cost to revenue ratio rose from 8.3% in 2013 to 9.1% in 2014 following the inclusion of the France Residential business, for which cost to revenue ratio was higher than the average for the group. Excluding the effect of inclusion, the cost to revenue ratio fell to 7.1% in 2014, compared with 7.7% in 2013.
B. LEASE EXPIRATIONS AND OCCUPANCY RATES
1. Annualised lease expirations: 7.9 years of residual term leases (5.8 years firm) for commercial activities
| $\mathbf{f}$ $\mathbf{m}^*$ | By lease end date (1s t b re a k) |
$%$ of total |
By lease end date |
$%$ of to tal |
|---|---|---|---|---|
| 2014 | 31.6 | 8% | 21,9 | 5% |
| 2015 | 29,4 | 7% | 2,6 | 1% |
| 2016 | 39,7 | 9% | 25,9 | 6% |
| 2017 | 43,7 | 10% | 30,0 | 7% |
| 2018 | 47,1 | 11% | 45,0 | 11% |
| 2019 | 30,0 | 7% | 30,0 | 7% |
| 2020 | 76,1 | 18% | 37,0 | 9% |
| 2021 | 33,9 | 8% | 37,8 | 9% |
| 2022 | 35,6 | 8% | 45,4 | 11% |
| 2023 | 6,7 | 2% | 9,2 | 2% |
| Be yond | 46,2 | 11% | 135, 2 | 32% |
| To tal | 419,9 | 100% | 419,9 | 100% |
| (ye a r) |
B y le a s e (1s t b |
e n d d a te re a k) |
B y le a s e |
e n d d a te |
|---|---|---|---|---|
| G S |
2 0 13 |
2 0 14 |
2 0 13 |
2 0 14 |
| Fra nc e |
5,7 | 5,4 | 6,8 | 6,4 |
| Ita ly |
6,9 | 6,3 | 12,6 | 12,1 |
| Offic e s |
6 , 1 |
5 , 7 |
8 , 5 |
8 , 0 |
| Hote ls & S e rvic e se c tor |
7,1 | 6,8 | 7,1 | 6,9 |
| Offic e - Ke y Ac c o u n ts |
6 , 2 |
5 , 8 |
8 , 4 |
7 , 9 |
| Othe r |
3,1 | n a |
5,5 | n a |
| To ta l |
5 , 8 |
5 , 8 |
8 , 0 |
7 , 9 |
The firm term of the leases remained stable between 2013 and 2014 following the disposal of short-term leases (sale of most of the Logistics business) and the signature of new leases, notably with Natixis and Thales, each for a firm term of 9 years.
2. Occupancy rate: 97.1%
| (%) | Oc c u p a n c y ra te |
||||
|---|---|---|---|---|---|
| GS * |
2 0 13 |
2 0 14 |
|||
| Fra nc e |
95,8% | 96,8% | |||
| Ita ly |
97,7% | 95,2% | |||
| Offic e s |
9 6 , 4 % |
9 6 , 3 % |
|||
| Hote ls & S e rvic e se c tor |
100,0% | 100,0% | |||
| Re side ntia l Ge rma ny |
98,7% | 98,3% | |||
| S tra te g ic a c tivitie s |
9 7 , 2 % |
9 7 , 1% |
|||
| Oth e r |
85,5% | n/a | |||
| To ta l |
9 6 , 0 % |
9 7 , 1% |
|||
* Excluding France Residential
The occupancy rate is 97.1%, excluding Logistics, and 96.3% including this segment. For France Offices, it grew by 1 point and was 96.8% following the lettings in the CB 21 Tower and the signature of preliminary sale agreements for vacant assets at the end of the year. In Italy Offices, the occupancy rate fell by 2.5% due to a 51,383 m² asset in Turin being vacated.
C. BREAKDOWN OF RENTAL INCOME - GROUP SHARE
1. Breakdown by major tenants: a strong rental income base
| (€ millio n ) |
An n u a lis e d |
|
|---|---|---|
| G S |
re n ta me 2 l in c o 0 14 |
% |
| Ora nge |
90,4 | 22% |
| Te le c om Ita lia |
56,5 | 13% |
| Ac c or |
23,7 | 6 % |
| S ue z Environne me nt |
21,3 | 5 % |
| EDF | 18,2 | 4 % |
| Da ssa ult S ystè me s |
9,8 | 2 % |
| Inte sa |
9,2 | 2 % |
| Eiffa ge |
8,4 | 2 % |
| Tha le s |
10,7 | 3 % |
| S NCF |
7,6 | 2 % |
| Te c nimont |
7,3 | 2 % |
| B&B | 6,8 | 2 % |
| Koria n |
4,4 | 1% |
| AON | 5,4 | 1% |
| P e uge ot/Citroë n |
5,2 | 1% |
| Quic k |
4,7 | 1% |
| Na tixis |
10,5 | 2 % |
| Othe r te na nt <€4m |
119,8 | 29% |
| To ta l re n ta l in c o me |
4 19 , 9 |
10 0 % |
2. Geographic breakdown: IDF, Berlin, Milan and Rome account for 54% of rental income
D.DISPOSAL AND AGREEMENTS FOR DISPOSALS: €986 MILLION Dis p o s a ls
| (€ millio n ) |
Dis p o s a ls (a gre e me nts a s of e nd of 2013 c lose d) 1 |
Ag re e me n ts a s o f e n d o f 2 0 13 to c lo s e |
Ne w d is p o s a ls 2 0 14 2 |
Ne w a g re me n ts 2 0 14 |
To ta l 2 0 14 |
Ma rg in vs 2 0 13 va lu e |
Yie ld |
To ta l Dis p o s a ls = 1 + 2 |
|
|---|---|---|---|---|---|---|---|---|---|
| Offic e s - Fra nc e |
100 % | 152 | 105 | 116 | 2 1 |
13 7 |
7,0% | 6,6% | 268 |
| Offic e s - Ita ly |
100 % | 2 9 |
3 | 7 9 |
2 | 8 1 |
3,3% | 6,1% | 10 8 |
| G S |
14 | 2 | 3 8 |
1 | 3 9 |
3,3% | 6,1% | 5 2 |
|
| Re side ntia l - De utsc hla nd |
100% | 119 | 1 | 3 3 |
127 | 16 0 |
5,4% | 7,1% | 15 1 |
| G S |
7 2 |
1 | 2 0 |
7 8 |
9 7 |
5,4% | 7,1% | 9 2 |
|
| Hote ls & S e rvic e se c tor |
100 % | 7 9 |
3 | 5 7 |
5 | 6 2 |
1,4% | 5,5% | 13 6 |
| G S |
2 2 |
1 | 16 | 1 | 18 | 1,4% | 5,5% | 3 9 |
|
| Othe r |
100 % | 17 | 0 | 608 | 143 | 751 | 0,2% | 6,1% | 625 |
| 10 | 0 | 565 | 129 | 694 | - 0,3% |
6,4% | 576 | ||
| To ta l a s s e t d is p o s a ls |
100 % | 395 | 113 | 894 | 298 | 1 19 1 |
1,9% | 6,2% | 1 2 8 9 |
| G S |
271 | 10 9 |
756 | 230 | 986 | 1, 5 % |
6 , 4 % |
1 0 2 7 |
During 2014, Foncière des Régions concluded €986 million in new disposals (€756 million) and disposal agreements (€230 million). These disposals mainly related to non-Core businesses (70%) with the sale of 77% of the Logistics portfolio.
New disposals in 2014 achieved a positive margin of 1.5% over appraisal values at the end of 2013.
E. ASSET ACQUISITIONS: €397 MILLION GROUP SHARE
| (€ millio n ) |
To ta l ID* 2 0 14 |
Yie ld |
|
|---|---|---|---|
| Offic e s - Fra nc e |
100% | 16 1, 9 |
6,5% |
| Offic e s - Ita ly |
100% | - | 0,0% |
| G S |
- | ||
| Hote ls & S e rvic e se c tor |
100% | 60,4 | 6,9% |
| G S |
17 , 2 |
||
| Re side ntia l Ge rma ny |
100% | 357,8 | 6,0% |
| G S |
2 17 , 9 |
||
| Othe r |
100% | - | 0,0% |
| To ta l |
100% | 580,1 | |
| G S |
3 9 7 , 0 |
6 , 2 % |
ID: Including Duties
In 2014, Foncière des Régions continued its strategy of acquiring assets in its strategic markets with:
- the acquisition in September 2014 of the Offices rented to Natixis in Charenton-le-Pont with a total surface area of almost 38,000 m²; the acquisition price was €162 million
- Hotel acquisitions totalling €60 million (100%) and the acquisition in June 2014 of the Hotel NH Amsterdam Centre for €48 million
- Residential investments in Germany for €358 million (100%), with 62% of the assets located in Berlin, 33% in Dresden and 5% in Leipzig.
F. DEVELOPMENT PROJECTS: €1.5 BILLION GROUP SHARE
1. Committed Projects: €532 million, Group share (of which 63% pre-let)
| P ro je c ts |
Typ e |
Lo c a tio n |
Are a |
P ro je c t |
S u rfa c e * (s q m) |
De live ry |
Ta rg e t re n t (€/s q m/ye a r) |
P re - le a s e d (%) |
To ta l B u d g e t** (M€) |
Ta rg e t Yie ld |
P ro g re s s |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Eurome d Ce nte r - Astrola be (QP FdR : 50%) |
Offic e s - Fra nc e |
Ma rse ille |
MRC | Construc tion |
14 000 | 2015 | 250 | 35% | 19 | > 7% | 100% |
| Eurome d Ce nte r - P a rking + Comme rc e s (QP FdR : 50%) |
Offic e s - Fra nc e |
Ma rse ille |
MRC | Construc tion |
900 | 2015 | N/A | 100% | 16 | > 7% | 100% |
| S te e l |
Offic e s - Fra nc e |
P a ris |
P a ris |
Re furbishme nt |
3 700 | 2015 | 600 | 0 % |
3 6 |
6 % |
80% |
| ERDF Avignon | Offic e s - Fra nc e |
Avignon | MRC | Re furbishme nt |
4 100 | 2015 | 160 | 100% | 9 | > 7% | 75% |
| Na nte rre Re spiro |
Offic e s - Fra nc e |
Na nte rre |
P a ris Re gions |
Construc tion |
11 150 | 2015 | 310 | 100% | 5 1 |
> 7% | 75% |
| Qua tuor |
Offic e s - Fra nc e |
Lille - Rouba ix |
MRC | Construc tion |
9 700 | 2015 | 160 | 72% | 2 3 |
> 7% | 80% |
| Askia - Cœ ur d'Orly (QP FdR : 25%) |
Offic e s - Fra nc e |
Orly | P a ris Re gions |
Construc tion |
18 500 | 2015 | 250 | 50% | 15 | > 7% | 70% |
| Gre e n Corne r |
Offic e s - Fra nc e |
S a int- De nis |
P a ris Re gions |
Construc tion |
20 400 | 2015 | 285 | 70% | 8 7 |
> 7% | 60% |
| Ca mpus Eiffa ge (QP FdR : 50%) |
Offic e s - Fra nc e |
Vé lizy |
P a ris Re gions |
Construc tion |
23 000 | 2015 | 270 | 100% | 5 3 |
> 7% | 70% |
| Eurome d Ce nte r - Hôte l (QP FdR : 50%) |
Offic e s - Fra nc e |
Ma rse ille |
MRC | Construc tion |
9 900 | 2016 | N/A | 100% | 19 | > 7% | 35% |
| Eurome d Ce nte r - Ca lypso (QP FdR : 50%) |
Offic e s - Fra nc e |
Ma rse ille |
MRC | Construc tion |
9 600 | 2016 | 250 | 0 % |
15 | > 7% | 20% |
| Da ssa ult S ystè me s Exte nsion (QP FdR : 50%) |
Offic e s - Fra nc e |
Vé lizy |
P a ris Re gions |
Construc tion |
13 100 | 2016 | 300 | 100% | 3 4 |
6 % |
5 % |
| S c hlumbe rge r Montpe llie r P ompigna ne |
Offic e s - Fra nc e |
Montpe llie r |
MRC | Re furbishme nt |
3 150 | 2016 | 155 | 100% | 8 | > 7% | 20% |
| S ile x I |
Offic e s - Fra nc e |
Lyon | MRC | Re furbishme nt |
10 600 | 2016 | 280 | 0 % |
4 7 |
6 % |
10% |
| Clinique S a int- Ma ndé |
Offic e s - Fra nc e |
S a int- Ma ndé |
P a ris Re gions Re |
furbishme nt |
5 500 | 2016 | N/A | 100% | 2 5 |
6 % |
5 % |
| Bose | Offic e s - Fra nc e |
S t Ge rma in e n La ye |
P a ris Re gions |
Construc tion |
5 100 | 2016 | 225 | 100% | 2 0 |
> 7% | 30% |
| Tha ïs |
Offic e s - Fra nc e |
Le va llois |
P a ris Re gions Re |
furbishme nt |
5 500 | 2017 | N/A | 0 % |
4 0 |
> 7% | 10% |
| B&B P orte de Choisy |
Hote ls |
P a ris |
P a ris |
Construc tion |
3 947 | 2015 | N/A | 100% | 2 | 6 % |
83% |
| B&B Lyon Ca luire |
Hote ls |
Lyon | MRC | Construc tion |
2 493 | 2015 | N/A | 100% | 1 | 7 % |
37% |
| B&B Roma inville |
Hote ls |
Roma inville |
P a ris Re gions |
Construc tion |
2 264 | 2015 | N/A | 100% | 2 | > 7% | 35% |
| B&B Torc y |
Hote ls |
Torc y |
P a ris Re gions |
Construc tion |
2 429 | 2015 | N/A | 100% | 2 | > 7% | 21% |
| B&B Mülhe im |
Hote ls |
Mülhe im |
Ge rma ny |
Construc tion |
2 306 | 2015 | N/A | 100% | 1 | > 7% | 40% |
| B&B Erfurt | Hote ls |
Erfurt | Ge rma ny |
Construc tion |
2 597 | 2015 | N/A | 100% | 1 | > 7% | 12% |
| B&B Be rlin |
Hote ls |
Be rlin |
Ge rma ny |
Construc tion |
N/A | 2016 | N/A | 100% | 2 | > 7% | 2 % |
| B&B Duisburg | Hote ls |
Duisburg | Ge rma ny |
Construc tion |
2 706 | 2015 | N/A | 100% | 2 | > 7% | 30% |
| To ta l |
2 0 0 6 4 2 |
63% | 532 | > 7 % |
49% |
*Surface 100% **Group share, including land cost and financial cost
2014 saw the renewal of the development pipeline with the delivery of 7 development projects, including the delivery of the New Velizy asset (46,000 m²) and the launch of 9 new projects.
The pre-letting rate was 63% at the end of 2014.
2. Managed projects:
| P ro je c ts |
Typ e |
Lo c a tio n |
Are a |
S u rfa c e * (s q m) |
De live ry time fra me |
|---|---|---|---|---|---|
| Na nc y Gra nd Cœ ur |
Offic e s - Fra nc e |
Na nc y |
MRC | 6 500 | 2016 |
| Eurome d Ce nte r : Bure a ux Flore a l (QP FdR 50%) |
Offic e s - Fra nc e |
Ma rse ille |
MRC | 13 500 | 2016 |
| Eurome d Ce nte r : Bure a ux He rmione (QP FdR 50%) |
Offic e s - Fra nc e |
Ma rse ille |
MRC | 10 400 | 2016 |
| S a int Ma ndé Loge me nts |
Offic e s - Fra nc e |
S a int Ma ndé |
P a ris Re gions |
7 300 | 2 017 |
| Toulouse Ma rque tte |
Offic e s - Fra nc e |
Toulouse | MRC | 10 900 | 2017 |
| Cœ ur d'Orly Comme rc e s (QP FdR 25%) |
Offic e s - Fra nc e |
Orly | P a ris Re gions |
31 000 | 2017 |
| Issy Gre ne lle |
Offic e s - Fra nc e |
Issy | P a ris Re gions |
10 800 | 2017 |
| S ile x II |
Offic e s - Fra nc e |
Lyon | MRC | 30 700 | 2018 |
| Ne w Vé lizy - Exte nsion (QP FdR 50%) |
Offic e s - Fra nc e |
Vé lizy |
P a ris Re gions |
14 000 | 2018 |
| Me udon S a ulnie r |
Offic e s - Fra nc e |
Me udon |
P a ris Re gions |
30 000 | 2018 |
| Me udon Gre e n Va lle y |
Offic e s - Fra nc e |
Me udon |
P a ris Re gions |
46 900 | 2018 |
| DS Ca mpus Exte nsion 2 (QP FdR 50%) |
Offic e s - Fra nc e |
Vé lizy |
P a ris Re gions |
11 000 | 2018 |
| Cœ ur d'Orly Bure a ux (QP FdR 25%) |
Offic e s - Fra nc e |
Orly | P a ris Re gions |
50 000 | 2017- 2018 |
| Mila n, S ymbiosis (Ripa monti) |
Offic e s - Ita ly |
Mila n |
Ita ly |
119 000 | De pe ndind pre - le t sta tus |
| To ta l |
3 9 2 0 0 0 |
G. PORTFOLIO
| Valuation and change in the portfolio (€ millio n ) |
Va lu e 2 0 13 |
Va lu e 2 0 14 |
Va lu e 2 0 14 G S |
LFL c h a n g e 12 mo n th s |
Yie ld ED 2 0 13 |
Yie ld ED 2 0 14 |
% o f p o rtfo lio |
|---|---|---|---|---|---|---|---|
| Offic e s - Fra n c e * |
4 664 | 5 032 | 4 353 | 3,0% | 6,8% | 6,6% | 45% |
| Offic e s - Ita ly* |
4 157 | 4 093 | 1 977 | - 0,2% |
6,1% | 6,1% | 20% |
| To ta l Offic e |
8 8 2 1 |
9 12 5 |
6 3 3 0 |
2 , 0 % |
6 , 6 % |
6 , 4 % |
65% |
| Ho te ls & S e rvic e s e c to r* |
3 232 | 3 243 | 844 | 2,0% | 6,3% | 6,1% | 9 % |
| Re s id e n tia l Ge rma n y |
2 446 | 2 746 | 1 656 | 2,9% | 6,6% | 6,5% | 17% |
| Oth e r |
1 662 | 1 088 | 778 | 1,3% | 4,6% | 4,7% | 8 % |
| P a rkin g fa c ilitie s |
241 | 210 | 124 | n a |
n c |
n a |
1% |
| P o rtfo lio |
16 4 0 2 |
16 4 13 |
9 7 3 2 |
2 , 1% |
6 , 5 % |
6 , 3 % |
10 0 % |
| Equity a ffilia te s |
2 3 |
2 0 |
2 0 |
||||
| To ta l - Co n s o lid a te d |
16 4 2 5 |
16 4 3 3 |
9 7 5 2 |
||||
| To ta l - GS |
10 0 10 |
9 7 5 2 |
|||||
| * In operation assets yield (Offices - France & Hotel and Service Sector) / Core assets (Offices -Italy) |
Valuation and change in the portfolio
The Group share of Foncière des Régions' total asset portfolio at the end of December 2014 stood at €9.8 billion (€16.4 billion at 100%) compared to €10 billion at the end of 2013, a like-for-like increase of 2.1% compared to the end of 2013.
Value adjustments on a like-for-like basis were supported by the France Offices (+3%), Residential Germany (+2.9%) and Hotels & Service (+2%) segments.
Geographic breakdown
| (€ millio n ) GS * |
2 0 14 |
|---|---|
| Fra nc e | 5 945 |
| Ita ly | 1 977 |
| Ge rma ny | 1 679 |
| Othe r | 131 |
| To ta l p o rtfo lio | 9 7 3 2 |
*Ex c luding park ing f ac ilit ie s
H. LIST OF MAJOR ASSETS
| To p 10 As s e ts |
Lo c a tio n |
Te n a n ts |
S u rfa c e (s q , m) |
S h a re o f a ffilia te |
|---|---|---|---|---|
| Tour CB 21 | P a ris- La Dé fe nse |
S ue z Environne me nt, AIG Europe , Nokia , Groupon |
68 079 | 75% |
| Na tixis Cha re nton |
Cha re nton |
Na tixis |
37 835 | 100% |
| Da ssa ult Ca mpus |
Ve lizy Villa c oubla y |
Da ssa ult |
56 193 | 50,1% |
| Comple xe Ga riba ldi |
Mila n |
Ma ire Te c nimont |
44 650 | 48,3% |
| Imme uble - 23 rue Mé dé ric |
ris 17ème P a |
Ora nge |
11 182 | 100,0% |
| Ne w Ve lizy |
Ve lizy Villa c oubla y |
Tha le s |
46 163 | 50,1% |
| Ca rré S uffre n |
ris 15ème P a |
AON, Institut Fra nç a is, Ministè re Educ a tion |
24 864 | 60% |
| P e rc ie r |
ris 8ème P a |
Chloe | 8 544 | 100,0% |
| Ca p 18 |
ris 18ème P a |
Ge ne gis, Me dia P a rtic ipa tions |
61 097 | 100,0% |
| Tra ve rsie re |
ris 12ème P a |
S NCF |
13 700 | 100,0% |
3. Analytical data for the business by segment
Offices France indicators are presented at 100% and as Group share (GS). Assets held partially are the following:
- Le Ponant 83.5% owned
- the CB 21 Tower 75% owned
- Carré Suffren 60% owned
- the Eiffage properties located at Vélizy (head office of Eiffage Construction and Eiffage Campus, the head office of Eiffage Groupe) 50.1% owned (fully consolidated)
- the DS Campus and New Velizy properties 50.1% owned (equity method)
- Euromed Center 50% owned (equity method)
- Askia, the first office building in the Cœur d'Orly project, 25% owned (equity method)
CAP 18 is reclassified under Offices France (instead of Logistics previously).
A. OFFICES FRANCE
1. Rental income recognised: €238 million, +0.7% on a like-for-like basis
1.1. Geographic breakdown strategic locations (Île-de-France and Regional Cities – MRC) generate 87% of rental income Re n ta l Re n ta l Re n ta l Re n ta l Ch a n g e
| (€ millio n ) |
S u rfa c e (s q m) |
Nu mb e r o f a s s e ts |
Re n ta l in c o me 2 0 13 |
Re n ta l in c o me 2 0 13 |
Re n ta l in c o me 2 0 14 |
Re n ta l in c o me 2 0 14 |
Ch a n g e (%) |
Ch a n g e (%) LFL |
% o f re n ta l in c o me |
|---|---|---|---|---|---|---|---|---|---|
| 10 0 % |
G S |
10 0 % |
G S |
||||||
| P a ris Ce ntre We st |
70 971 | 11 | 30,3 | 30,5 | 30,5 | 30,6 | 0,4% | 12,9% | |
| S outhe rn P a ris |
77 996 | 11 | 33,5 | 28,7 | 31,7 | 26,9 | - 6,3% |
11,3% | |
| North Ea ste rn P a ris |
113 753 | 6 | 20,5 | 20,5 | 20,4 | 20,4 | - 0,6% |
8,6% | |
| We ste r Cre sc e nt a nd La Dé fe nse |
207 141 | 2 2 |
63,9 | 58,2 | 63,7 | 57,2 | - 1,7% |
24,0% | |
| Inne r suburbs* |
351 996 | 2 2 |
17,9 | 18,0 | 21,9 | 20,4 | 13,5% | 8,6% | |
| Oute r suburbs |
124 653 | 5 6 |
20,6 | 20,6 | 15,7 | 15,7 | - 23,7% |
6,6% | |
| To ta l P a ris Re g io n |
9 4 6 5 10 |
12 8 |
18 6 , 8 |
17 6 , 6 |
18 3 , 8 |
17 1, 2 |
- 3 , 0 % |
7 1, 9 % |
|
| MRC | 4 2 5 7 6 4 |
7 5 |
3 8 , 9 |
3 8 , 8 |
3 3 , 7 |
3 3 , 7 |
- 13 , 1% |
14 , 2 % |
|
| Oth e r Fre n c h re g io n s |
4 8 4 2 9 0 |
18 0 |
3 9 , 6 |
3 9 , 6 |
3 3 , 2 |
3 3 , 2 |
- 16 , 2 % |
13 , 9 % |
|
| To ta l |
1 8 5 6 5 6 4 |
383 | 2 6 5 , 3 |
2 5 5 , 0 |
2 5 0 , 7 |
2 3 8 , 2 |
- 6 , 6 % |
0 , 7 % |
10 0 , 0 % |
Group share rental income fell from €255 million to €238.2 million, a drop of €16.8 million over one year. This change is the combined result of:
- asset disposals and sharing agreements in 2013 and 2014 (-€18.6 million), due primarily to disposals in the outer suburbs and in the Regions, along with the sharing of the DS Campus (-€2.7 million)
- asset acquisitions and deliveries (+€5.8 million):
- o acquisitions:
- of the Natixis building to Charenton in Q4 2014 (€2.6 million)
- of the SICRA headquarters to Chevilly-Larue in March 2013 (€0.4 million)
- o delivery of pre-leased assets, including:
- the New Velizy asset, a turnkey property leased to Thales, delivered in October 2014 (€1.1 million Group share)
- delivery of the Pégase asset, a turnkey property leased to Eiffage and located in Clichy (92) in April 2013 (+€0.4 million)
- a turnkey office building leased to Egis in Montpellier, delivered in July 2014 (+€0.4 million)
- vacation of properties earmarked for refurbishment or complete redevelopment (-€3.1 million), notably the Silex 1 and 2 buildings in Lyon and the Levallois Anatole France property
- an increase on a like-for-like basis of +0.7% (€1.5 million) thanks to:
- o the positive effect of indexation (+€1 million)
- o the rental activity (+€0.5 million):
- rentals (+€3.3 million)
- vacated premises (-€2.1 million)
- renewals/renegotiations (-€0.7 million, a drop of 1% in renewed leases)
2. Annualised rental income: €263 million
2.1 Breakdown by major tenants
| (€ millio n ) GS * |
S u rfa c e (s q m) |
Nb o f a s s e ts |
An n u a lis e d re n ta l in c o me 2 0 13 |
An n u a lis e d re n ta l in c o me 2 0 14 |
Ch a n g e (%) |
% o f re n ta l in c o me |
|---|---|---|---|---|---|---|
| Ora nge |
603 007 | 192 | 108,4 | 90,4 | - 16,6% |
34,3% |
| S ue z Environne me nt |
44 637 | 2 | 21,1 | 21,3 | 0,9% | 8,1% |
| EDF | 195 083 | 23 | 19,0 | 18,2 | - 4,4% |
6,9% |
| Da ssa ult S ystè me s |
56 192 | 1 | 9,8 | 9,8 | 0,3% | 3,7% |
| Tha le s |
88 274 | 2 | 9,2 | 10,7 | 16,2% | 4,1% |
| Eiffa ge |
190 657 | 104 | 9,1 | 8,4 | - 7,5% |
3,2% |
| S NCF |
13 700 | 1 | 7,7 | 7,6 | - 1,4% |
2,9% |
| AON | 15 592 | 1 | 5,5 | 5,4 | - 1,3% |
2,1% |
| P e uge ot Citroë n |
19 531 | 1 | 5,1 | 5,2 | 1,4% | 2,0% |
| Othe r te na nts < € 4M |
592 001 | 53 | 74,5 | 75,7 | 1,7% | 28,8% |
| To ta l |
1 8 5 6 5 6 4 |
383 | 2 6 9 , 4 |
2 6 3 , 1 |
- 2 , 3 % |
10 0 , 0 % |
Currently, the ten leading tenants represent 71% of annualised rents, a percentage slightly lower than at the end of 2013 (75%).
The 2.3% drop in rental income between 2013 and 2014 is mainly due to the impact of disposals (notably Orange and EDF). This was partially offset by the acquisition of the Natixis Charenton building (€10.5 million of annual rents).
2.2 Geographical breakdown: Île-de-France accounts for 76% of rental income
| (€ millio n ) |
S u rfa c e (s q m) |
Nu mb e r o f a s s e ts |
An n u a lis e d re n ta l in c o me |
An n u a lis e d re n ta l in c o me |
Ch a n g e (%) |
% o f re n ta l |
|---|---|---|---|---|---|---|
| GS * |
2 0 13 |
2 0 14 |
in c o me |
|||
| P a ris Ce ntre We st |
70 971 | 11 | 34,00 | 34,0 | 0,0% | 13% |
| S outhe rn P a ris |
77 996 | 11 | 30,60 | 28,6 | - 6,6% |
11% |
| North Ea ste rn P a ris |
113 753 | 6 | 20,70 | 21,4 | 3,2% | 8 % |
| We ste r Cre sc e nt a nd La Dé fe nse |
207 141 | 22 | 64,00 | 63,1 | - 1,4% |
24% |
| Inne r suburbs* |
351 996 | 22 | 27,50 | 40,2 | 46,1% | 15% |
| Oute r suburbs |
124 653 | 56 | 19,40 | 13,0 | - 33,1% |
5 % |
| To ta l P a ris Re g io n |
9 4 6 5 10 |
12 8 |
19 6 , 2 0 |
2 0 0 , 2 |
2 , 0 % |
76% |
| MRC | 4 2 5 7 6 4 |
7 5 |
3 6 , 10 |
3 2 , 6 |
- 9 , 8 % |
12 % |
| Oth e r Fre n c h re g io n s |
4 8 4 2 9 0 |
18 0 |
3 7 , 10 |
3 0 , 3 |
- 18 , 2 % |
12 % |
| To ta l |
1 8 5 6 5 6 4 |
3 8 3 |
2 6 9 , 4 0 |
2 6 3 , 1 |
- 2 , 3 % |
10 0 , 0 % |
* including DS Campus in GS 50%
The geographical breakdown of rental income is in line with that of the accounted rental income, confirming the prevalence of the Île-de-France share, with 76% of annualised rental income. The main changes in rental income by geographical area reflect the rental activity since 1 January 2014:
- Disengagement from the Regions (-18.2%) and from the outer suburbs (-33.1%) by disposing of assets, particularly the EDF rue de Verdun in Nîmes (€0.9 million in annualised rental income) and the Orange asset in Soisy-sous-Montmorency
- Developments in the inner suburbs (+46% of annualised rental income), notably the acquisition of the Natixis Charenton asset.
3. Indexation
The indexation effect is +€1 million over 12 months. 28% of rental income is indexed to the ICC, 69% is indexed to the ILAT, whilst the balance is indexed to the ILC or IRL.
The rents benefiting from an indexation floor (1%) represent 34% of the annualised rents and are indexed on the ILAT.
The impact of a negative indexation of the ILAT and the ICC at -1% on annualised rents is estimated at €1.4 million, a decrease of 0.5%.
4. Rental activity
| (€ millio n ) |
S u rfa c e (s q m) |
An n u a lis e d re n ta l in c o me |
An n u a lis e d re n ta l in c o me (€/s q m) |
|---|---|---|---|
| Va c a ting |
117 593 | 14,3 | 121,4 |
| Le tting |
76 410 | 18,4* | 241,3 |
| Re ne wa l |
115 543 | 28,1 | 243,0 |
| *GS rent = 11,9 M € |
In 2014, one asset in Levallois-Perret and two assets in Meudon and Vélizy were vacated with a view to redevelopment, but also:
- 8 properties rented by the Eiffage group (9,249 m²; €0.5 million of rent) in January 2014 in accordance with our initial agreements
- of 16 assets leased to Orange (45,545 m²: €6.1 million of rent) located mostly in regions and which are intended to be sold vacant to developers (5 have already been sold in 2014 for 13,194 m²/€1.1 million).
These vacancies have been offset by letting existing assets and delivering leased assets, representing €11.9 million in annualised rental income (76,410 m2 ) and the delivery of the New Vélizy assets (46,000 m²) in October and the building leased to Egis in Montpellier (6,000 m²) in July.
As regards marketing efforts, the significant events for this year were the letting in the CB 21 Tower. Five new leases with Covidien, FHB, Groupon, Wano and Verizon, representing a total of 11,364 m² were signed in 2014. The Tower currently has an occupation rate of 97% and one floor remains to be let (1,300 m²).
2014 was also underscored by the renewal of 11% of the leases in the portfolio as a result of the continuation of our partnership strategy, which is proving effective in keeping our tenants in our properties.
All the signatures of the year (including the acquisition of the building Natixis at Charenton) represent €50 million for 6.1 year firm lease.
5. Lease expirations and occupancy rates
5.1. Lease expirations: 6.4 years residual lease term (5.4 years firm)
| (€ millio n )* |
B y le a s e e n d d a te 1s t b ( re a k) |
% o f to ta l |
B y le a s e e n d d a te |
% o f to ta l |
|---|---|---|---|---|
| 2015 | 28,7 | 11% | 19,5 | 7 % |
| 2016 | 27,9 | 11% | 2,2 | 1% |
| 2017 | 22,2 | 8 % |
13,5 | 5 % |
| 2018 | 28,1 | 11% | 17,8 | 7 % |
| 2019 | 25,2 | 10% | 38,3 | 15% |
| 2020 | 27,7 | 11% | 29,4 | 11% |
| 2021 | 18,3 | 7 % |
36,1 | 14% |
| 2022 | 19,5 | 7 % |
30,9 | 12% |
| 2023 | 32,8 | 12% | 40,1 | 15% |
| 2024 | 4,1 | 2 % |
3,4 | 1% |
| Be yond |
28,6 | 11% | 31,8 | 12% |
| To ta l |
2 6 3 , 1 |
10 0 % |
2 6 3 , 1 |
10 0 % |
* including DS Campus in GS 50%
The firm residual term is lower at 5.4 years, vs. 5.7 years at the end of 2013. By lease termination date, the residual term of the leases amounts to 6.4 years (vs. 6.8 in 2013).
The mechanical loss of 12 months of residual term was partially offset by the signature of long leases (Natixis and Thales in New Velizy leases for 9 years firm at the end of 2014), the lease renegotiations, particularly for the Percier assets (Chloé lease + 3 years firm).
| (%) | 2 0 13 |
2 0 14 |
|---|---|---|
| P a ris Ce ntre We st |
100,0% | 100,0% |
| S outhe rn P a ris |
99,2% | 99,2% |
| North Ea ste rn P a ris |
96,1% | 97,4% |
| We ste r Cre sc e nt a nd La Dé fe nse |
92,5% | 97,7% |
| Inne r suburbs |
98,5% | 99,0% |
| Oute r suburbs |
95,4% | 94,0% |
| Tota l P a ris Re gion |
9 6 , 3 % |
9 7 , 9 % |
| MRC | 95,4% | 95,1% |
| Othe r Fre nc h re gions |
93,8% | 89,9% |
| To ta l |
9 5 , 8 % |
9 6 , 8 % |
5.2. Occupancy rate and type: an occupancy rate of 96.8%
The occupancy rate is up in comparison with the end of 2013 (96.8% vs. 95.8%). That is explained by the successful letting of CB 21 Tower. Therefore, the occupancy rate in Île-de-France has risen by 1.6 points over the year.
The increase in the vacancy rate in the Regions is explained by the liberation of the Eiffage and Orange sites which are the subject of an ongoing sales process.
The other vacant office space is mainly found in 3 properties located in Paris (marketing ongoing), Nîmes and in Lille; these latter two are the subject of an ongoing sales process.
6. Reserves for unpaid rents
| 2 0 12 |
2 0 14 |
|---|---|
| 0,10% | 0,2% |
| 0,3 | 0,5 |
* net provision / reversals of provison
For France Offices, the level of unpaid rents remains very low, given the quality of the client base.
7. Disposals and disposal agreements: €137 million
| 7. Disposals and disposal agreements: €137 million | ||||||||
|---|---|---|---|---|---|---|---|---|
| (€ millio n ) |
Dis p o s a ls (a gre e me nts a s of e nd of 2013 c lose d) 1 |
Ag re e me n ts a s o f e n d o f 2 0 13 to c lo s e |
Ne w d is p o s a ls 2 0 14 |
Ne w a g re me n ts 2 0 14 |
To ta l 2 0 14 |
Ma rg in vs 2 0 13 va lu e |
Yie ld |
To ta l Dis p o s a ls = 1 + 2 |
| Tota l P a ris Re gion |
65,9 | 82,6 | 58,2 | 8,6 | 6 6 , 7 |
10,0% | 6,0% | 12 4 , 0 |
| MRC | 60,4 | 5,2 | 14,8 | 12,7 | 2 7 , 5 |
11,7% | 5,5% | 7 5 , 2 |
| Othe r Fre nc h re gions |
26,0 | 17,6 | 23,7 | 0,0 | 2 3 , 7 |
0,3% | 9,7% | 4 9 , 7 |
| P a rtic ipa tions |
0,0 | 0,0 | 19,5 | 0,0 | 19 , 5 |
0,0% | n a |
19 , 5 |
| To ta l |
15 2 , 3 |
10 5 , 5 |
116 , 1 |
2 1, 3 |
13 7 , 5 |
7 , 0 % |
6 , 6 % |
2 6 8 , 4 |
New commitments (new disposals and new preliminary disposal agreements) reflecting a desire to improve the quality of the portfolio. These €137 million commitments relate to 34 assets, including 30 in the dynamic compartment and a total of €51 million in other French regions.
Work on disposals in 2014 also included the materialisation of €152 million in preliminary agreements signed in previous years.
8. Acquisitions: €162 million ID
| Assets | Surface (sq.m) |
Location | Tenants | Acquisition Price (€million) |
Yield* | |
|---|---|---|---|---|---|---|
| NATIXIS CHARENTON | 37 835 | Charenton le pont | Natixis | 161,9 | 6,5% | |
| Total | 37 835 | 161,9 | 0,0% |
*including duties
Foncière des Régions entered into a new partnership with Natixis by acquiring a 38,000 m² asset leased for 9 years firm at the start of October 2014 under a sale and lease back programme, BREEAM In-Use certified.
9. Development projects: a pipeline of more than €1.4 billion
The development policy of Foncière des Régions aims mainly at continuing the asset enhancement work undertaken (improvement of asset quality and creation of value), supporting Key Accounts partners over the long term in the deployment of their real estate strategy, and managing new operations in strategic locations.
The strategy is based, in the greater Paris area, on locations which are well served by public transport and/or in established tertiary districts and in the large Regional Cities where the annual take-up is greater than 50,000 m² per year, in prime locations.
9.1 Delivery of properties
Over the year, the following properties were delivered:
- in October 2014, the New Velizy asset, a campus of 46,000 m² built turnkey for the Thales group and located in Vélizy-Villacoublay, under a 9 year firm lease, HQE and BREEAM "Very Good" certified
- in July 2014, a new turnkey office building covering 6,000 m² leased to Egis and located in the Parc de la Pompignane in Montpellier under a 9 year firm lease.
9.2. Committed projects
| P ro je c ts |
Lo c a tio n |
Are a |
P ro je c t |
S u rfa c e ** (s q m) |
De live ry |
Ta rg e t o ffic e s re n t (€/s q m/ye a r) |
P re - le t (%) |
To ta l B u d g e t* (€m) |
P ro g re s s |
Yie ld |
|---|---|---|---|---|---|---|---|---|---|---|
| Eurome d Ce nte r - Astrola be (QP FdR : 50%) |
Ma rse ille |
MR | Construc tion |
14 000 | 2015 | 250 | 35% | 19 | 100% | > 7% |
| Eurome d Ce nte r - P a rking + Comme rc e s (QP FdR : 50%) |
Ma rse ille |
MR | Construc tion |
900 | 2015 | N/A | 100% | 16 | 100% | > 7% |
| S te e l |
P a ris |
P a ris re gions |
Re furbishme nt |
3 700 | 2015 | 600 | 0 % |
3 6 |
80% | 6 % |
| ERDF Avignon | Avignon | MR | Re c onstruc tion |
4 100 | 2015 | 160 | 100% | 9 | 75% | > 7% |
| Na nte rre Re spiro |
Na nte rre |
P a ris re gions |
Construc tion |
11 150 | 2015 | 310 | 100% | 5 1 |
75% | > 7% |
| Qua tuor |
Lille - Rouba ix |
MR | Construc tion |
9 700 | 2015 | 160 | 72% | 2 3 |
80% | > 7% |
| Askia - Cœ ur d'Orly (QP FdR : 25%) |
Orly | P a ris re gions |
Construc tion |
18 500 | 2015 | 250 | 50% | 15 | 70% | > 7% |
| Gre e n Corne r |
S a int- De nis |
P a ris re gions |
Construc tion |
20 400 | 2015 | 285 | 70% | 8 7 |
60% | > 7% |
| Ca mpus Eiffa ge (QP FdR : 50%) |
Vé lizy |
P a ris re gions |
Construc tion |
23 000 | 2015 | 270 | 100% | 5 3 |
70% | > 7% |
| Eurome d Ce nte r - Hôte l (QP FdR : 50%) |
Ma rse ille |
MR | Construc tion |
9 900 | 2016 | N/A | 100% | 19 | 35% | > 7% |
| Eurome d Ce nte r - Ca lypso (QP FdR : 50%) |
Ma rse ille |
MR | Construc tion |
9 600 | 2016 | 250 | 0 % |
15 | 20% | > 7% |
| Da ssa ult S ystè me s Exte nsion (QP FdR : 50%) |
Vé lizy |
P a ris re gions |
Construc tion |
13 100 | 2016 | 300 | 100% | 3 4 |
5 % |
6 % |
| S c hlumbe rge r Montpe llie r P ompigna ne |
Montpe llie r |
MR | Re c onstruc tion |
3 150 | 2016 | 155 | 100% | 8 | 20% | > 7% |
| S ile x I |
Lyon | MR | Re furbishme nt |
10 600 | 2016 | 280 | 0 % |
4 7 |
10% | 6 % |
| Clinique S a int- Ma ndé |
S a int- Ma ndé |
P a ris re gions Re |
c onstruc tion |
5 500 | 2016 | N/A | 100% | 2 5 |
5 % |
6 % |
| Bose | S t Ge rma in e n La ye |
P a ris re gions |
Construc tion |
5 100 | 2016 | 225 | 100% | 2 0 |
30% | > 7% |
| Tha ïs |
Le va llois |
P a ris re gions |
Re furbishme nt |
5 500 | 2017 | ND | 0 % |
4 0 |
10% | > 7% |
| To ta l |
18 1 9 0 0 |
62% | 5 18 |
53% | > 7 % |
*Surface 100% **In Group share, including land cost and financial cost
Several projects were launched and begun during the year:
- Calypso, an office building of 9,600 m 2 within the Euromed Center project in Marseille
- Silex 1, a 10,600 m2office building in the heart of the Part-Dieu district in Lyon
- A turnkey for ERDF in Avignon over a floor area of 4,100 m²
- Thaïs, a 5,500 m 2 building at the foot of the Louise Michel metro station in Levallois-Perret.
Leases have also been signed over the year:
- with Dassault Systèmes for an extension to the existing campus in Vélizy over 13,100 m². The planning application was filed at the end of June and the work is due to start in February 2015. The lease for the campus (with extension) is extended to 10 years from 2016.
- with Bose on a 5,100 m 2 turnkey property for the future headquarters of the group in Saint-Germain-en-Laye for which work began in July
- with Schlumberger on a 3,150 m 2 turnkey property in the Parc de la Pompignane, in Montpellier for which work began in November
- with INICEA on a 12 year firm lease in advance of completion, for the construction of a 120-bed psychiatric clinic in Saint Mandé, as part of the development of the site formerly occupied by EDF.
Finally, regarding the Euromed Center Phase 1 development in Marseille, the 857-space car park and the first office building (Astrolabe), covering 14,000 m 2 , were delivered in January 2015. Work on the hotel (following the signing of a firm 12-year lease with Louvre Hôtels for the Golden Tulip brand) is ongoing, with delivery expected in 2016.
9.3. Managed projects
| P ro je c ts |
Lo c a tio n |
P ro je c t |
Are a |
S u rfa c e * (s q m) |
De live ry time fra me |
|
|---|---|---|---|---|---|---|
| Na nc y Gra nd Cœ ur |
Na nc y |
Construc tion |
MR | 6 500 | 2016 | |
| Eurome d Ce nte r : Bure a ux Flore a l (QP FdR 50%) |
Ma rse ille |
Construc tion |
MR | 13 500 | 2016 | |
| Eurome d Ce nte r : Bure a ux He rmione (QP FdR 50%) |
Ma rse ille |
Construc tion |
MR | 10 400 | 2016 | |
| S a int Ma ndé Loge me nts |
S a int Ma ndé |
Re c onstruc tion |
P a ris re gions |
7 300 | 2017 | |
| Toulouse Ma rque tte |
Toulouse | Re c onstruc tion |
MR | 10 900 | 2017 | |
| Cœ ur d'Orly Comme rc e s (QP FdR 25%) |
Orly | Construc tion |
P a ris re gions |
31 000 | 2017 | |
| Issy Gre ne lle |
Issy | Re struc tura tion + Exte nsion |
P a ris re gions |
10 800 | 2017 | |
| S ile x II |
Lyon | Re struc tura tion + Exte nsion |
MR | 30 700 | 2018 | |
| Ne w Vé lizy - Exte nsion (QP FdR 50%) |
Vé lizy |
Construc tion |
P a ris re gions |
14 000 | 2018 | |
| Me udon S a ulnie r - Opa le |
Me udon |
Re c onstruc tion |
P a ris re gions |
30 000 | 2018 | |
| Me udon Gre e n Va lle y - Ca nopé e |
Me udon |
Re c onstruc tion |
P a ris re gions |
46 900 | 2018 | |
| DS Ca mpus Exte nsion 2 (QP FdR 50%) |
Vé lizy |
Construc tion |
P a ris re gions |
11 000 | 2018 | |
| Cœ ur d'Orly Bure a ux (QP FdR 25%) |
Orly | Construc tion |
P a ris re gions |
50 000 | 2017- 2018 |
|
| To ta l |
2 7 3 0 0 0 |
*surface 100%
The building permits have been completed on the Nancy Grand Cœur (6,500 m²), Meudon Saulnier – Opale (30,000 m²) and Meudon Green Valley – Canopée (47,000 m²) projects. These projects are currently in the premarketing phase and are likely to be committed depending on leasing agreements to be completed.
The building permit has been obtained for the extension of the New Velizy campus, of which the first phase of 46,000 m² was delivered in October 2014. Discussions with Thales are currently underway regarding a 14,000 m 2 extension.
On the Silex 2 (project to renovate/extend the tower vacated by EDF in the Part-Dieu district of Lyon), Toulouse Marquette (10,900 m 2 building in the centre of Toulouse) and Issy Grenelle (renovation and extension over 10,800 m² in Issy-les-Moulineaux) the building permits have been filed.
Further, work is continuing on the Euromed Center assets: Floréal and Hermione.
10. Asset values
10.1 Change in assets
| 10.1 Change in assets | |||||||
|---|---|---|---|---|---|---|---|
| $(\epsilon$ million) Asset |
Value ED 2013 |
Value adjustment |
Ac quisitions | Disposals | Invest. | Transfer | Value ED 2014 |
| Assets in operation | 3912 | 116 | 162 | $-249$ | 50 | $\mathbf{0}$ | 3991 |
| Assets under developement | 205 | 18 | $\Omega$ | $\Omega$ | 139 | $\Omega$ | 362 |
| Total | 4 1 1 7 | 134 | 162 | $-249$ | 189 | 0 | 4 3 5 3 |
| * including DS Campus, New Velizy, Euromed and Cœur d'Orly in GS |
10.2 Change on a like-for-like basis
Value GS (incl. assets under development)
| $(\epsilon$ million) | 100% value ED 2013 |
100% value ED 2014 |
Value ED 2014 $GS*$ |
LFL change 12 months |
Yie ld ED 2013 |
Yield ED 2014 |
$%$ of to tal value |
|---|---|---|---|---|---|---|---|
| Paris Centre West | 575.5 | 624,6 | 624,6 | 8,4% | 5,9% | 5,4% | 14% |
| Southern Paris | 594,5 | 584,2 | 467.8 | 4,2% | 6,3% | 6,1% | 11% |
| North Eastern Paris | 293,0 | 306,0 | 306,0 | 4,0% | 6,4% | 7,2% | 7% |
| Wester Crescent and La Défense | 1188.3 | 1139,0 | 992,2 | 0.5% | 6,2% | 6,4% | 23% |
| Innersuburbs | 621,2 | 974.4 | 679,1 | 0,4% | 6,5% | 5,9% | 16% |
| Outersuburbs | 218,2 | 170,2 | 170.2 | 1.3% | 8,6% | 7,7% | 4% |
| TotalParis Region | 3 490,6 | 3798.4 | 3 2 3 9 , 9 | 2,9% | 6,1% | 6,2% | 74% |
| MRC | 384,3 | 420,1 | 420,1 | 2,9% | 7,3% | 7,5% | 10% |
| Other French regions | 495.3 | 331,0 | 331.0 | $-1,4%$ | 9,2% | 9,0% | 8% |
| To tal in operation | 4 3 7 0 , 2 | 4 5 4 9 , 6 | 3991,0 | 2,5% | 6,8% | 6,6% | 92% |
| Assets under developement | 294,3 | 482,8 | 362,0 | 8,0% | 0,3% | 3,6% | 8% |
| Total | 4 6 6 4 , 5 | 5 0 3 2 , 4 | 4 3 5 3 , 0 | $3.0\%$ | 6,5% | 6,3% | 100% |
2014 was marked by a 3% increase in like-for-like assets:
Paris Centre West is the area with the highest growth (8.3%). This is due to the contraction in capitalisation rates on Parisian assets with long leases, reflecting a market trend during the year. Note that in the city area of Paris, the increase is 6% on a like-for-like basis.
In 2014, only the assets in other French regions decreased in value with a drop of 1.4% on a like-for-like basis.
11. Strategic asset segmentation
- "Core" portfolio: the Core portfolio is the strategic asset core, consisting of resilient properties providing long-term income. Mature buildings can be disposed of in timely fashion in managed proportions, freeing up resources that can be reinvested in value-creating operations, either by shoring up our asset base or by new investments.
- "Secondary" portfolio: the "Secondary" portfolio originates principally from outsourcing operations with our major partners-lessees. This portfolio provides a pocket yielding higher than the offices portfolio average, with an historically high lease renewal rate. The small size of these individual assets and their liquidity on the local markets make them apt candidates for gradual disposal.
- Portfolio "In the process of valuation": the "in the process of valuation" portfolio includes properties targeted for specific restructuring or rental development actions. These assets are primed to become core assets once the asset management work has been completed.
| assets once the asset management work has been completed. | |||||||||
|---|---|---|---|---|---|---|---|---|---|
| Co re P o rtfo lio |
Va lu e e n h a n c e me n t P o rtfo lio |
S e c o n d a ry a s s e t |
To ta l |
||||||
| Numbe r of a sse ts |
7 0 |
5 4 |
259 | 383 | |||||
| Va lue ED GS (€ million) |
2 844 | 910 | 599 | 4 3 5 3 |
|||||
| Yie ld |
6,2% | 5,5% | 8,1% | 6 , 3 % |
|||||
| Re sidua l firm dura tion of le a se s (ye a rs) |
6,2 | 3,2 | 4,0 | 5 , 4 |
|||||
| Oc c upa nc y ra te |
99,3% | 94,3% | 90,5% | 9 6 , 8 % |
The core part of the portfolio rose slightly during 2014 (65% of the Office France portfolio, i.e. 2%) while the "Secondary" compartment decreased significantly over the year (from 19% at the end of 2013 to 14% at the end of 2014), thanks to the sale of €203 million in assets in this compartment (thanks to a targeted disposal strategy).
B. OFFICES ITALY
Listed on the Milan stock exchange since 1999, Beni Stabili is the largest listed Italian property firm. Its assets consist largely of offices located in cities in northern and central Italy, particularly Milan and Rome. The company's assets totalled €4.1 billion at the end of December 2014.
Foncière des Régions holds 48.3% of the capital of Beni Stabili. The figures are disclosed as 100%.
1. Accounted rental income: -1.5% like-for-like
| 1. Accounted rental income: -1.5% like-for-like |
||||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| (€ millio n ) |
S u rfa c e (s q m) |
Nu mb e r o f a s s e ts |
Re n ta l in c o me 2 0 13 |
Re n ta l in c o me 2 0 14 |
Ch a n g e (%) |
Ch a n g e (%) LFL |
% o f to ta l |
|||
| Core portfolio |
1 726 | 214 | 228,4 | 226,0 | - 1,1% |
98,8% | ||||
| Dyna mic portfolio |
9 5 |
3 7 |
3,3 | 2,7 | - 23,4% |
1,2% | ||||
| S u b to ta l |
1 8 2 1 |
251 | 2 3 1, 7 |
2 2 8 , 7 |
- 1, 3 % |
10 0 , 0 % |
||||
| De ve lope me nt portfolio |
0 | 2 | 0,0 | 0,0 | 0,0% | 0,0% | ||||
| To ta l |
1 8 2 1 |
253 | 2 3 1, 7 |
2 2 8 , 7 |
- 1, 3 % |
- 1, 5 % |
10 0 , 0 % |
The variation in rental income between 31 December 2013 and 31 December 2014 is €3 million, or -1.3%. This change is due primarily to:
- the effect of properties being vacated, leased and indexation (mostly the impact of an asset in Turin being vacated for which the annualised rent is €5.4 million): -€3.3 million
- disposals: -€6.6 million
- deliveries of assets under development, principally Via dell'Arte in Rome and San Fedele and San Nicolao in Milan: +€5.6 million.
The change on a like-for-like basis was - 1.5% over the period.
2. Annualised rental income: €219 million
2.1 Breakdown by portfolio
| 2.1 Breakdown by portfolio | ||||||
|---|---|---|---|---|---|---|
| (€ millio n ) |
S u rfa c e (s q m) |
Nu mb e r o f a s s e ts |
An n u a lis e d re n ta l in c o me 2 0 13 |
An n u a lis e d re n ta l in c o me 2 0 14 |
Ch a n g e (%) |
% o f to ta l |
| Core portfolio |
1 726 | 214 | 227,2 | 216,4 | - 5,0% |
99,0% |
| Dyna mic portfolio |
9 5 |
3 7 |
2,2 | 2,2 | 1,0% | 1,0% |
| S u b to ta l |
1 8 2 1 |
251 | 2 2 9 , 4 |
2 18 , 7 |
- 4 , 9 % |
10 0 , 0 % |
| De ve lope me nt portfolio |
0 | 2 | 0,0 | 0,0 | 0,0% | 0,0% |
| To ta l |
1 8 2 1 |
253 | 2 2 9 , 4 |
2 18 , 7 |
- 4 , 9 % |
10 0 , 0 % |
2.2. Geographic breakdown
| 2.2. Geographic breakdown | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| (€ millio n ) |
S u rfa c e (s q m) |
Nu mb e r o f a s s e ts |
An n u a lis e d re n ta l in c o me 2 0 13 |
An n u a lis e d re n ta l in c o me 2 0 14 |
Ch a n g e (%) |
% o f to ta l |
||||
| Mila n |
426 | 4 1 |
89,1 | 83,2 | - 7,1% |
38,1% | ||||
| Rome | 158 | 3 2 |
19,5 | 19,7 | 1,0% | 9,0% | ||||
| Othe r |
1 236 | 178 | 120,8 | 115,8 | - 4,4% |
52,9% | ||||
| To ta l |
1 8 2 1 |
251 | 2 2 9 , 4 |
2 18 , 7 |
- 4 , 9 % |
10 0 , 0 % |
The increase in revenues in Rome is due to the delivery of the Via dell' Arte property in Q2 2014.
2.3. Breakdown by tenant
| 2.3. Breakdown by tenant | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| (€ millio n ) |
S u rfa c e (s q m) |
Nu mb e r o f a s s e ts |
An n u a lis e d re n ta l in c o me 2 0 13 |
An n u a lis e d re n ta l in c o me 2 0 14 |
Ch a n g e (%) |
% o f to ta l |
||||
| Te le c om Ita lia |
1 160 | 159 | 118,4 | 117,0 | - 1,2% |
53,5% | ||||
| Othe r |
661 | 9 2 |
111,0 | 101,7 | - 9,2% |
46,5% | ||||
| To ta l |
1 8 2 1 |
251 | 2 2 9 , 4 |
2 18 , 7 |
- 4 , 7 % |
10 0 , 0 % |
3. Indexation
The annual indexation in rental income is usually calculated by taking 75% of the increase in the Consumer Price Index (CPI) applied on each anniversary of the signing date of the agreement. The average increase in the IPC index was 0.2% in 2014. All leases are protected against negative indexation.
4. Rental activity
During 2014, rental activity can be summarised as follows:
| (€ millio n ) |
S u rfa c e (s q m) |
An n u a lis e d re n ta l in c o me |
An n u a lis e d re n ta l in c o me (€/s q m) |
|---|---|---|---|
| Va c a ting |
69 666 | 10,4 | 149 |
| Le tting |
25 384 | 11,4 | 451 |
| Re ne wa l |
23 800 | 4,2 | 175 |
The new leases mainly concern the San Nicolao property (€5.4 million in rent) let under the terms of a 13-year lease, seven of which are firm, to Luxottica. The other leases concern the Piazza San Fedele (€2.1 million) and Via Dante (€1.2 million) assets in Milan, and the Via dell'Arte asset in Rome (€0.7 million).
Renewals was renegociated resulted in increased rental income of 14%, mostly from the Via Dell' Union asset in Milan and the Via Darsena asset in Ferrara, with a surface area of almost 12,455 m².
The Corso Ferrucci property (Turin, 51,383 m²) was vacated in June 2014 and is being actively marketed.
5. Lease expirations and occupancy rates
5.1. Lease expirations: 12.1 years residual lease term (6.3 years firm)
| (€ millio n ) |
B y le a s e e n d d a te 1s t b ( re a k) |
% o f to ta l |
B y le a s e e n d d a te |
% o f to ta l |
|---|---|---|---|---|
| 2015 | 5,6 | 3 % |
4,6 | 2 % |
| 2016 | 3,1 | 1% | 0,9 | 0 % |
| 2017 | 12,2 | 6 % |
1,6 | 1% |
| 2018 | 8,4 | 4 % |
1,2 | 1% |
| 2019 | 33,0 | 15% | 2,3 | 1% |
| 2020 | 4,6 | 2 % |
1,0 | 0 % |
| 2021 | 119,4 | 55% | 1,6 | 1% |
| 2022 | 26,0 | 12% | 10,6 | 5 % |
| 2023 | 5,2 | 2 % |
10,5 | 5 % |
| 2024 | 1,0 | 0 % |
7,6 | 3 % |
| Be yond |
0,2 | 0 % |
176,8 | 81% |
| To ta l |
2 18 , 7 |
10 0 % |
2 18 , 7 |
10 0 % |
Leases expiring after 2024 are mostly linked to Telecom Italia. The residual firm term for leases was 6.3 years at the end of 2014.
5.2. Occupancy rate and type: an occupancy rate of 95.2%
The spot financial occupancy rate at the end of 2014 was 95.2% for the Core portfolio, down in comparison with the end of 2013 (97.7%) after the property in Turin was vacated.
6. Reserves for unpaid rents
| (€ million) | 2013 | 2014 |
|---|---|---|
| As % of rental income | 1,9% | 1,0% |
| In value * | 4,5 | 2,4 |
* net provision / reversals of provison
Reserve unpaid rent corresponds to net charges, reversals or provisions and losses, which amounted to 1% of rental income in 2014, down slightly compared with 2013.
7. Disposals and disposal agreements: €81 million
In 2014, the value of disposals and disposal agreements was €80.9 million, a total of €108 million in cash sales.
These new commitments in 2014 were entered into at 3.3% above the 2013 appraisal values and based on a 6.1% yield. Dis p o s a ls Ag re e me n ts Ne w Ne w
| Dis p o s a ls |
Ag re e me n ts |
Ne w |
Ne w |
|||||
|---|---|---|---|---|---|---|---|---|
| (€ millio n ) |
(a gre e me nts a s of e nd of 2013 c lose d) |
a s o f e n d o f 2 0 13 c lo s e d |
d is p o s a ls 2 0 14 |
a g re e me n ts 2 0 14 |
To ta l 2 0 14 |
Ma rg in vs 2 0 13 va lu e |
Yie ld |
To ta l d is p o s a ls |
| Mila n |
9,1 | 0,0 | 74,5 | 0,0 | 7 4 , 5 |
4,4% | 6,1% | 8 3 , 6 |
| Rome | 0,0 | 0,0 | 0,9 | 0,2 | 1, 2 |
0,0% | - 13,7% |
0 , 9 |
| Othe r |
19,4 | 3,3 | 4,0 | 1,3 | 5 , 3 |
- 6,9% |
7,5% | 2 3 , 4 |
| To ta l |
2 8 , 6 |
3 , 3 |
7 9 , 4 |
1, 5 |
8 0 , 9 |
3 , 3 % |
6 , 1% |
10 8 , 0 |
8. Acquisitions
No acquisitions were made during the year.
9. Development projects
9.1 Projects delivered
Delivery of the Via dell'Arte assets in Rome in May 2014 (surface area of 6,700 m², 93% let) and San Nicolao in Milan in December 2014 (surface area of 11,234 m², fully pre-let).
9.2. Managed projects
| Lo c a tio n |
Are a |
S u rfa c e (s q m) |
De live ry time fra me |
|---|---|---|---|
| Mila no |
Ita ly |
119 000 | De pe nding P re le t S ta tus |
| 119 0 0 0 |
|||
10. Asset values
10.1 Change in assets
| 10.1 Change in assets | |||||||
|---|---|---|---|---|---|---|---|
| (€ millio n ) |
Va lu e ED 2 0 13 |
Ch a n g e in va lu e |
Ac q u is itio n s |
Dis p o s a ls |
In ve s t. |
Re c la s s |
Va lu e ED 2 0 14 |
| Core portfolio |
3 713 | - 1 |
0 | - 95 |
17 | 134 | 3 769 |
| Dyna mic portfolio |
155 | - 3 |
0 | - 10 |
1 | 0 | 143 |
| S u b to ta l |
3 8 6 9 |
- 3 |
0 | - 10 5 |
18 | 13 4 |
3 9 12 |
| De ve lope me nt portfolio |
288 | - 3 |
0 | 0 | 3 0 |
- 134 |
181 |
| To ta l |
4 15 7 |
- 6 |
0 | - 10 5 |
4 8 |
0 | 4 0 9 3 |
10.2 Like-for-like change: -0.2%
| (€ millio n ) |
Va lu e ED 2 0 13 10 0 % |
Va lu e ED 2 0 14 10 0 % |
LFL c h a n g e 12 mo n th s |
Yie ld ED 2 0 13 |
Yie ld ED 2 0 14 |
% o f to ta l va lu e |
|---|---|---|---|---|---|---|
| Core portfolio |
3 713,4 | 3 768,9 | 0,0% | 6,1% | 6,1% | 92,1% |
| Dyna mic portfolio |
155,3 | 143,4 | - 1,8% |
1,4% | 1,5% | 3,5% |
| S u b to ta l |
3 8 6 8 , 8 |
3 9 12 , 3 |
- 0 , 1% |
5 , 9 % |
5 , 9 % |
9 5 , 6 % |
| De ve lope me nt portfolio |
288,2 | 180,7 | - 1,6% |
n a |
n a |
4,4% |
| To ta l |
4 15 7 , 0 |
4 0 9 3 , 0 |
- 0 , 2 % |
5 , 5 % |
5 , 6 % |
10 0 , 0 % |
The value of the Beni Stabili portfolio was solid with a decrease of 0.2% on a like-for-like basis in 2014.
| (€ millio n ) |
Va lu e ED 2 0 13 10 0 % |
Va lu e ED 2 0 14 10 0 % |
LFL c h a n g e 12 mo n th s |
Yie ld ED 2 0 13 |
Yie ld ED 2 0 14 |
% o f to ta l va lu e |
|---|---|---|---|---|---|---|
| Mila n |
1 759,6 | 1 812,4 | 0,8% | 5,1% | 5,2% | 44,3% |
| Rome | 316,9 | 352,3 | 1,0% | 6,2% | 6,2% | 8,6% |
| Othe r |
1 792,2 | 1 747,7 | - 1,2% |
6,7% | 6,6% | 42,7% |
| S u b to ta l |
3 8 6 8 , 8 |
3 9 12 , 3 |
- 0 , 1% |
5 , 9 % |
5 , 9 % |
9 5 , 6 % |
| De ve lope me nt portfolio |
288,2 | 180,7 | - 1,6% |
n a |
n a |
4,4% |
| To ta l |
4 15 7 , 0 |
4 0 9 3 , 0 |
- 0 , 2 % |
5 , 5 % |
5 , 6 % |
10 0 , 0 % |
Most assets are located in Milan and Rome (53%).
C. HOTELS & SERVICE SECTOR
Foncière des Murs (FDM), which is 28.5% owned by Foncière des Régions, is a listed property investment company (SIIC) specialising in the service sector, especially in hotels, healthcare, and retail. The Company's investment policy favours partnerships with the leading operators in their business sector, in order to offer secure returns to its shareholders. The figures are quoted at 100% and FDM share of affiliates.
1. Accounted rental income: -0.6% like-for-like
Recognised rental income is presented at 100% and in Foncière des Murs share. 164 assets held partially correspond to acquisitions in 2012 (50.2% owned) and H1 2013 and 2014.
Breakdown by business sector
| Breakdown by business sector | |||||||||
|---|---|---|---|---|---|---|---|---|---|
| Re n ta l |
Re n ta l in c o me |
Re n ta l in c o me |
Re n ta l in c o me |
Ch a n g e |
Ch a n g e |
Ch a n g e |
% o f |
||
| (€ millio n ) |
Nu mb e r o f a s s e ts |
in c o me 2 0 13 |
2 0 13 in GS FDM |
2 0 14 10 0 % |
2 0 14 in GS FDM |
(%) 10 0 % |
(%) in GS |
(%) LFL |
re n ta l in c o me |
| Hote ls |
322 | 143,1 | 126,5 | 142,8 | 125,8 | - 0,2% |
- 0,6% |
- 0,2% |
70% |
| He a lthc a re |
2 9 |
22,2 | 22,2 | 16,5 | 16,5 | - 25,6% |
- 25,6% |
1,1% | 9 % |
| Re ta il P re mise s |
185 | 38,7 | 38,7 | 36,7 | 36,7 | - 5,1% |
- 5,1% |
- 2,4% |
21% |
| To ta l |
536 | 2 0 4 , 0 |
18 7 , 4 |
19 6 , 1 |
17 9 , 0 |
- 3 , 9 % |
- 4 , 5 % |
- 0 , 6 % |
10 0 % |
Consolidated rental income stood at €196 million at 100% at the end of 2014, down 3.9% compared with 2013. This was due mainly to:
- the impact of disposals in 2013 and 2014 (-€10.4 million)
- the impact of 2014 acquisitions/deliveries amounting to €3.6 million.
- the decrease in rental income on a like-for-like basis: 0.6% (-€1.1 million), due to the drop in Accor revenues (-0.8% over the year) and decreases in rental incomes from Jardiland assets compared with an extension of leases following the lease renegotiations at the end of 2013.
| (€ millio n ) |
Nu mb e r o f a s s e ts |
Re n ta l in c o me 2 0 13 in GS |
Re n ta l in c o me 2 0 14 in GS |
Ch a n g e (%) |
Ch a n g e (%) LFL |
% o f re n ta l in c o me |
|---|---|---|---|---|---|---|
| Ac c or |
129 | 87,9 | 83,9 | - 4,5% |
- 0,5% |
47% |
| B&B | 187 | 21,6 | 22,9 | 5,7% | - 0,2% |
13% |
| Koria n |
2 9 |
19,5 | 16,1 | - 17,4% |
1,1% | 9 % |
| Quic k |
8 1 |
17,1 | 16,6 | - 2,5% |
2,3% | 9 % |
| Ja rdila nd |
4 9 |
14,9 | 13,5 | - 9,3% |
- 9,0% |
8 % |
| S unpa rks |
4 | 13,6 | 13,7 | 1,3% | 1,3% | 8 % |
| Courte pa ille |
5 5 |
6,7 | 6,6 | - 1,9% |
1,1% | 4 % |
| Club Me d |
1 | 3,4 | 3,4 | 0,0% | 0,0% | 2 % |
| Gé né ra le de S a nté |
0 | 2,7 | 0,4 | - 83,6% |
n/a | 0 % |
| NH | 1 | 0,0 | 1,8 | n/a | n/a | 1% |
| To ta l |
536 | 18 7 , 4 |
17 9 , 0 |
- 4 , 4 % |
- 0 , 6 % |
10 0 % |
1.2 Breakdown by tenant
2. Annualised rental income: €180 million (FDM share of affiliates)
| Nu mb e r |
An n u a lis e d |
An n u a lis e d |
% o f |
||||
|---|---|---|---|---|---|---|---|
| (€ millio n ) |
S u rfa c e (s q m) |
o f |
re n ta l in c o me |
re n ta l in c o me |
Ch a n g e (%) |
re n ta l in c o me 71% |
|
| a s s e ts |
2 0 13 |
2 0 14 |
|||||
| Hote ls |
1 121 838 | 322 | 125,8 | 127,6 | 1,5% | ||
| He a lthc a re |
115 559 | 2 9 |
20,9 | 15,6 | - 25,2% |
9 % |
|
| Re ta il P re mise s |
197 573 | 185 | 38,6 | 36,7 | - 4,8% |
20% | |
| To ta l |
1 4 3 4 9 7 0 |
536 | 18 5 , 4 |
18 0 , 0 |
- 2 , 9 % |
10 0 % |
2.1. Breakdown by business sector
2.2 Breakdown by tenant
| (€ millio n ) |
S u rfa c e (s q m) |
Nu mb e r o f a s s e ts |
An n u a lis e d re n ta l in c o me 2 0 13 |
An n u a lis e d re n ta l in c o me 2 0 14 |
Ch a n g e (%) |
% o f re n ta l in c o me |
|---|---|---|---|---|---|---|
| Ac c or |
594 363 | 129 | 86,9 | 83,4 | - 4,1% |
46% |
| B&B | 337 632 | 187 | 21,9 | 23,8 | 8,8% | 13% |
| Koria n |
115 559 | 2 9 |
18,2 | 15,6 | - 14,1% |
9 % |
| Quic k |
37 487 | 8 1 |
17,1 | 16,6 | - 2,8% |
9 % |
| Ja rdila nd |
151 681 | 4 9 |
15,0 | 13,5 | - 9,5% |
8 % |
| S unpa rks |
133 558 | 4 | 13,6 | 13,7 | 0,9% | 8 % |
| Courte pa ille |
8 405 | 5 5 |
6,6 | 6,6 | 0,2% | 4 % |
| Club Me d |
45 813 | 1 | 3,4 | 3,4 | 0,5% | 2 % |
| Gé né ra le de S a nté |
10 472 | 0 | 2,7 | 0,0 | n/a | 0 % |
| To ta l |
1 4 3 4 9 7 0 |
536 | 18 5 , 4 |
18 0 , 0 |
- 2 , 9 % |
10 0 % |
2.3. Geographic breakdown
| (€ millio n ) |
S u rfa c e (s q m) |
Nu mb e r o f a s s e ts |
An n u a lis e d re n ta l in c o me 2 0 13 |
An n u a lis e d re n ta l in c o me 2 0 14 |
Ch a n g e (%) |
% o f re n ta l in c o me |
|---|---|---|---|---|---|---|
| P a ris CBD |
0 | 0 | 0,0 | 0,0 | n/a | 0 % |
| P a ris e xc l. CBD |
73 066 | 9 | 21,4 | 20,5 | - 4,1% |
11% |
| Inne r suburbs |
114 340 | 3 3 |
18,3 | 18,0 | - 1,8% |
10% |
| Oute r suburbs |
124 085 | 5 7 |
15,6 | 15,6 | - 0,3% |
9 % |
| To ta l P a ris Re g io n |
3 11 4 9 1 |
9 9 |
5 5 , 3 |
5 4 , 1 |
- 2 , 3 % |
30% |
| MRC | 273 760 | 109 | 34,7 | 32,8 | - 5,4% |
18% |
| Othe r Fre nc h re gions |
548 041 | 291 | 66,1 | 60,2 | - 9,0% |
33% |
| Inte rna tiona l |
301 678 | 3 7 |
29,3 | 33,0 | 12,5% | 18% |
| To ta l |
1 4 3 4 9 7 0 |
536 | 18 5 , 4 |
18 0 , 0 |
- 2 , 9 % |
10 0 % |
The increase in international rental income is linked to the investment program implemented in 2014, and in particular with the acquisition of the NH hotel in Amsterdam.
3. Indexation
54% of the rental income is indexed to benchmark indices. All of the portfolios generating fixed rental income were indexed:
- the Korian portfolio was indexed in January 2014 based on the Q4 2013 Rental Reference Index (IRL), which had a positive impact of €0.2 million;
- the indexation of Jardiland, based on the ILC construction cost index for one third of the portfolio and the IRL Rental Reference Index for the other two-thirds of the portfolio, took place in July 2014; the negative impact of €1.5 million is due to the decreased rents granted following the lease renegotiations in 2014;
- the indexation of the Quick and Courtepaille portfolios, which was based on the construction cost index (ILC), took place in October 2014, generating a total impact of +€0.4 million.
46% of rental income was indexed on Accor revenue, which fell 0.8% over the year.
4. Lease expirations and occupancy rates
| $(\epsilon$ million) | By lease end date $(1st$ bre a k) |
$%$ of to tal |
By lease end date |
$%$ of to tal |
|---|---|---|---|---|
| 2015 | 0,8 | 0% | 0,8 | 0% |
| 2016 | 0,0 | 0% | 0,0 | 0% |
| 2017 | 40,7 | 23% | 40,7 | 23% |
| 2018 | 40,6 | 23% | 40,6 | 23% |
| 2019 | 21,1 | 12% | 19,4 | 11% |
| 2020 | 0,3 | 0% | 0,3 | 0% |
| 2021 | 0,3 | 0% | 0,3 | 0% |
| 2022 | 6,2 | 3% | 6,2 | 3% |
| 2023 | 1,0 | 1% | 1,0 | 1% |
| 2024 | 7,4 | 4% | 7,4 | 4% |
| Beyond | 61,7 | 34% | 63,3 | 35% |
| To tal | 180,0 | 100% | 180,0 | 100% |
The firm residual lease term was 6.8 years at the end of 2014, compared to 7.1 years at the end of 2013. The occupancy rate was 100% at the end of 2014.
2017 and 2018 expirations mostly concerned Accor leases.
5. Reserves for unpaid rents
The portfolio had no reserves for bad debt during 2014, just as in 2013.
6. Disposals and disposal agreements: €62 million
| 6. Disposals and disposal agreements: €62 million | ||||||||
|---|---|---|---|---|---|---|---|---|
| $(\epsilon$ million) | Disposals (agreements as of end of 2013 $\cosh d$ |
Agreements as of end of 2013 to close |
New disposals 2014 $\mathbf{2}$ |
New agrements 2014 |
Total 2014 |
Margin vs $2013$ value |
Yield | Total Disposals $= 1 + 2$ |
| Hote ls | 43,4 | 0.0 | 0.3 | 4,6 | 4,9 | 6.6% | 5,1% | 43,7 |
| Healthcare | 33,6 | 0,0 | 56,9 | 0,0 | 56,9 | 1.0% | 5,5% | 90,6 |
| RetailPremises | 1,7 | 3,1 | 0,0 | 0,0 | 0,0 | 0.0% | 0.0% | 1,7 |
| Total | 78,6 | 3,1 | 57,2 | 4,6 | 61,8 | 1,4% | 5,5% | 135,9 |
Five properties were sold during 2014, for a value of €57 million. These disposals, on a portfolio or unit basis, only concerned the healthcare sector. Also, a disposal agreement on a property representing a total of €5 million was signed during the year.
7. Acquisitions
| Assets | Surface (sq.m) |
Location | Tenants | Acquisition Price* ID ( $\epsilon$ million) |
Gross Yield $ID**$ |
|---|---|---|---|---|---|
| NH Amsterdam | 10 472 | Pays-Bas | NH | 48,3 | 6,8% |
| B&B Salon de Provence | 1954 | France | B&B | 2,8 | 7,5% |
| B&B Valenciennes Marly | 1932 | France | B&B | 3,3 | 7,2% |
| B&B EuraLille | 2797 | France | B&B | 6,0 | 6,6% |
| Total | 17155,0 | $\mathbf{0,0}$ | 60,4 | 6,9% |
*In GS of Foncière des Murs
**ID = Including duties
Foncière des Murs acquired the NH Amsterdam Centre hotel in June 2014 for €48 million. 3 B&B hotels were acquired by the B2 Hotel Invest investment partnership (50.2% owned by FDM) for €12 million.
8. Development projects: a €59 million pipeline
8.1. Committed projects: €59 million, 100% pre-let
| P ro je c ts |
Lo c a tio n |
Are a |
S u rfa c e (s q m) |
De live ry |
P re - le t (%) |
To ta l B u d g e t (€m) |
P ro g re s s |
||
|---|---|---|---|---|---|---|---|---|---|
| B&B P orte de Choisy |
Fra nc e |
P a ris |
Construc tion |
3 947 | 2015 | 6,3% | 100,0% | 16 | 83% |
| B&B Lyon Ca luire |
Fra nc e |
MRC | Construc tion |
2 493 | 2015 | 6,7% | 100,0% | 7 | 37% |
| B&B Roma inville |
Fra nc e |
P a ris Re gions |
Construc tion |
2 264 | 2015 | >7% | 100,0% | 6 | 35% |
| B&B Torc y |
Fra nc e |
P a ris Re gions |
Construc tion |
2 429 | 2015 | >7% | 100,0% | 7 | 21% |
| B&B Mülhe im |
Ge rma ny |
Ge rma ny |
Construc tion |
2 306 | 2015 | >7% | 100,0% | 5 | 40% |
| B&B Erfurt | Ge rma ny |
Ge rma ny |
Construc tion |
2 597 | 2015 | >7% | 100,0% | 4 | 12% |
| B&B Be rlin |
Ge rma ny |
Ge rma ny |
Construc tion |
n/a | 2016 | >7% | 100,0% | 8 | 2 % |
| B&B Duisburg | Ge rma ny |
Ge rma ny |
Construc tion |
2 706 | 2015 | >7% | 100,0% | 5 | 30% |
| To ta l |
18 7 4 2 |
>7 % |
10 0 , 0 % |
5 9 |
The 2* B&B hotel with 265 rooms in Paris (19th arrondissement) Porte des Lilas purchased in advance of completion was delivered in May 2014.
Foncière des Murs also owns several buildings under development, which are all leased to B&B Hôtels:
- one hotel at Porte de Choisy (Ivry-sur-Seine) developed by the B2 Hotel Invest investment partnership (50.2% owned by FDM). It is a six-floor hotel with 182 rooms
- a hotel with 120 rooms in Caluire-et-Cuire, just outside Lyon, owned by the B2 Hotel Invest investment partnership
- a 130-room hotel in Torcy
- a 107-room hotel in Romainville
- 4 hotels in Germany, totalling 433 rooms, open as of May 2015.
9. Asset values
9.1 Change in asset values
| 9.1 Change in asset values | |||||||
|---|---|---|---|---|---|---|---|
| (€ millio n ) |
Va lu e ED 2 0 13 GS |
Va lu e a d ju s tme n t |
Ac q u is itio n s |
Dis p o s a ls |
In ve s t. |
Tra n s fe rt |
Va lu e ED 2 0 14 GS FDM |
| Asse ts in ope ra tion |
2 941 | 5 2 |
6 0 |
- 135 |
0 | 2 6 |
2 9 4 5 |
| Asse ts unde r de ve lope me nt |
2 6 |
6 | 0 | 0 | 16 | - 26 |
2 1 |
| To ta l |
2 9 6 6 |
5 8 |
6 0 |
- 13 5 |
16 | 0 | 2 9 6 5 |
The asset value of Foncière des Murs was €2,965 million at the end of 2014, up on a like-for-like basis by 2.0% over the year.
9.2 Like-for-like change: +2.0%
| (€ millio n ) |
10 0 % va lu e ED |
10 0 % va lu e ED |
Va lu e ED 2 0 14 |
LFL c h a n g e |
Yie ld ED 2 0 13 |
Yie ld ED 2 0 14 |
% o f to ta l va lu e |
|---|---|---|---|---|---|---|---|
| 2 0 13 GS |
2 0 14 |
G S |
1 ye a r |
||||
| P a ris |
408,0 | 397,7 | 391,5 | 10,3% | 5,6% | 5,2% | 12,3% |
| Inne r suburbs |
307,4 | 345,2 | 313,1 | 3,4% | 5,6% | 5,8% | 10,6% |
| Oute r suburbs |
252,6 | 292,9 | 263,4 | 3,7% | 6,2% | 5,9% | 9,0% |
| To ta l P a ris Re g io n s |
9 6 8 , 0 |
10 3 5 , 8 |
9 6 7 , 9 |
6 , 1% |
5 , 8 % |
5 , 6 % |
3 1, 9 % |
| MRC | 554,7 | 610,1 | 537,2 | 0,4% | 6,2% | 6,1% | 18,8% |
| Othe r Fre nc h Re gions |
990,2 | 1077,6 | 940,6 | - 0,9% |
6,6% | 6,4% | 33,2% |
| Inte rna tiona l |
453,5 | 519,6 | 519,6 | 1,6% | 6,4% | 6,3% | 16,0% |
| To ta l |
2 9 6 6 , 4 |
3 2 4 3 , 2 |
2 9 6 5 , 3 |
2 , 0 % |
6 , 2 % |
6 , 1% |
10 0 , 0 % |
| 3. Business analysis by segment - Group share Hotel and Service sector - 2014 annual results |
|||||||
|---|---|---|---|---|---|---|---|
| (€ millio n ) |
10 0 % va lu e ED 2 0 13 GS |
10 0 % va lu e ED 2 0 14 |
Va lu e ED 2 0 14 G S |
LFL c h a n g e 1 ye a r |
Yie ld ED 2 0 13 |
Yie ld ED 2 0 14 |
% o f to ta l va lu e |
| Hote ls |
2 011,1 | 2 380,5 | 2 111,5 | 2,8% | 6,3% | 6,0% | 73,4% |
| He a lthc a re |
331,8 | 235,5 | 235,5 | - 2,7% |
6,3% | 6,4% | 7,3% |
| Re ta il P re mise s |
597,6 | 597,5 | 597,5 | 0,3% | 6,5% | 6,3% | 18,4% |
| To ta l in o p e ra tio n |
2 9 4 0 , 6 |
3 2 13 , 5 |
2 9 4 4 , 5 |
1, 8 % |
6 , 3 % |
6 , 1% |
9 9 , 1% |
| Asse ts unde r de ve lope me nt |
29,7 | 20,8 | 30,5% | n.a | n.a | 0,9% | |
| To ta l |
2 9 6 6 , 3 |
3 2 4 3 , 2 |
2 9 6 5 , 3 |
2 , 0 % |
6 , 2 % |
6 , 1% |
10 0 , 0 % |
In the hotel sector, a like-for-like advance of 2.0% is noted, compared to the end of 2013, mainly due to the compression of capitalisation rates on the Paris assets.
The healthcare sector fell by 2.7%, due to impairment on two specific assets. Restated for these two assets, the change on a like-for-like basis on healthcare is +0.6%.
On retail premises (+0.3%), the fall in capitalisation rates offset the rise in transfer duties, 0.7% out of Paris.
D. GERMAN RESIDENTIAL
Foncière des Régions is involved in the Residential sector in Germany via its subsidiary, Immeo, of which it owns 60.9%. The company is responsible for over 41,000 units, located mostly in North Rhine-Westphalia and Berlin.
The strategy used by Foncière des Régions for this business is to continue the geographical diversification of its presence by strengthening its presence in Berlin and in other dynamic and attractive cities such as Dresden and Leipzig.
From an operational point of view, 2014 saw an accelerated rotation of the portfolio which played a major role in the improved results of the company.
The figures are presented at GS Immeo.
1. Accounted rental income: +1.8% like-for-like
1.1. Geographic breakdown
| 1.1. Geographic breakdown | ||||||||
|---|---|---|---|---|---|---|---|---|
| (€ millio n ) |
S u rfa c e (s q m) |
Nu mb e r o f u n its |
Re n ta l in c o me 2 0 13 |
Re n ta l in c o me 2 0 14 |
Ch a n g e (%) |
Ch a n g e (%) LFL |
% o f re n ta l in c o me |
|
| Be rlin* |
792 544 | 11 848 | 18,3 | 4 6 , 0 |
151,2% | 4,9% | 27% | |
| NRW | 1 945 699 | 29 498 | 134,8 | 12 3 , 7 |
- 8,2% |
1,4% | 73% | |
| To ta l |
2 7 3 8 2 4 3 |
4 1 3 4 6 |
15 3 , 1 |
16 9 , 7 |
10 , 8 % |
1, 8 % |
10 0 % |
|
* Including Dresde and Leipzig
Rental income stood at €169.7 million in 2014, compared with €152.5 million in 2013. This change was due mainly to:
- the impact of disposals (-€12.4 million)
- the impact of acquisitions (+€26.7 million)
- the change in rental income on a like-for-like basis (+€2.3 million).
The 1.8% rise in rental income on a like-for-like basis over a year was essentially driven by the growth of the portfolios located in Berlin, Dresden and Leipzig, which saw average growth of 4.9%, proving the relevance of the geographical diversification policy.
Regulated rents accounted for 10% of the North Rhine-Westphalia portfolio (or 7% of the total portfolio) and had an average reversion of +14%.
Berlin accounts for 11% of 2014 rental income on a like-for-like basis (included Dresde and Leipzig)
2. Annualised rental income: €177 million
2.1. Geographic breakdown
| 2.1. Geographic breakdown | ||||||||
|---|---|---|---|---|---|---|---|---|
| (€ millio n ) |
S u rfa c e (s q m) |
Nu mb e r o f u n its |
An n u a lis e d re n ta l in c o me 2 0 13 |
An n u a lis e d re n ta l in c o me 2 0 14 |
Ch a n g e (%) |
Lo ye r mo ye n €/m²/mo is |
% o f re n ta l in c o me |
|
| Be rlin* |
792 544 | 11 848 | 31,2 | 5 7 , 5 |
84,4% | 6,3 | 32% | |
| NRW | 1 945 699 | 29 498 | 128,3 | 119 , 8 |
- 6,6% |
5,1 | 68% | |
| To ta l |
2 7 3 8 2 4 3 |
4 1 3 4 6 |
15 9 , 5 |
17 7 , 3 |
11, 2 % |
5 , 5 |
10 0 % |
|
* Including Dresde and Leipzig
3. Indexation
The rental income from residential premises in Germany changes according to three mechanisms:
- re-letting: the option to increase the rent freely without being excessive in urban areas
- for current leases: by implementing a three-year maturity, option to increase the rent by 15% to 20% depending on the region without being able to exceed a market average (Mietspiegel)
- for current leases: option to increase the rent when work is done. The increase is then limited to 11% of the work which contributed to the valuation of the building and the rent cannot exceed the Mietspiegel.
4. Occupancy rate
| (%) | 2 0 13 |
2 0 14 |
|---|---|---|
| Be rlin* |
99,0% | 98,3% |
| NRW | 98,7% | 98,3% |
| To ta l |
9 8 , 7 % |
9 8 , 3 % |
* Including Dresden and Leipzig
The occupancy rate for assets in operation stood at 98.3% at 31 December 2014 compared to 98.7% at 31 December 2013. The occupancy rate is down slightly due to the result of resuming the management of the portfolios acquired in the second half of the year.
5. Reserves for unpaid rents
| (€ millio n ) |
2 0 13 |
2 0 14 |
|---|---|---|
| As % of re nta l inc ome |
2,0% | 3,3% |
| In va lue * |
3,0 | 5,5 |
* net provision / reversals of provison
The increase in unpaid rent in Germany in 2014 was mainly the result of taking over the management of the portfolios acquired during the course of the year.
6. Disposals and disposal agreements: €160 million
| 6. Disposals and disposal agreements: €160 million | ||||||||
|---|---|---|---|---|---|---|---|---|
| (€ m illion) |
Dis p o s a ls (a gre e me nts a s of e nd of 2013 c lose d) 1 |
Ag re e me n ts a s o f e n d o f 2 0 13 to c lo s e |
Ne w d is p o s a ls 2 0 14 2 |
Ne w a g re me n ts 2 0 14 |
To ta l 2 0 14 |
Ma rg in vs 2 0 13 va lu e |
Yie ld |
To ta l Dis p o s a ls = 1 + 2 |
| Ger m a n y |
118,9 | 1,3 | 32,5 | 127,3 | 15 9 , 9 |
5,4% | 7,1% | 15 1, 5 |
| Tot al |
118 , 9 |
1, 3 |
3 2 , 5 |
12 7 , 3 |
15 9 , 9 |
5 , 4 % |
7 , 1% |
15 1, 5 |
2014 was particularly active, with €159.9 million in new commitments concluded at an average rate of over 5.4% to the appraisal value. 32% of these transactions were in Duisburg.
7. Acquisitions: €358 million mainly in Berlin and Dresden
| Assets - in GS | Surface (sq.m) |
Number of units resi |
Acquisition Price (€million) ID* |
Gross Yield |
|---|---|---|---|---|
| Berlin | 169 869 | 2 373 | 222,3 | 5,7% |
| Dresden | 109 335 | 2 225 | 116,5 | 6,3% |
| Leipzig | 26 421 | 389 | 19,0 | 6,8% |
| Total | 305 625 | 4 987 | 357,8 | 6,0% |
*including duties
€357.8 million in acquisitions were made during 2014, mostly in Berlin and Dresden. These investments have a
yield of 6.0%. Thanks to their technical features and their excellent locations within their respective markets, the average expected rent reversion by the company on these new assets will done between +25% and +30%.
8. Asset values
8.1. Change in asset values
| 8.1. Change in asset values | |||||||||
|---|---|---|---|---|---|---|---|---|---|
| (€ millio n ) |
Va lu e ED 2 0 12 |
Va lu e a d ju s tme n t |
Ac q u is itio n s |
Dis p o s a ls |
In ve s t. |
Va lu e ED 2 0 14 |
|||
| NRW | 1848 | 3 9 |
0 | - 139 |
0 | 1747 | |||
| Be rlin* |
587 | 3 5 |
358 | - 8 |
0 | 972 | |||
| To ta l |
2435 | 7 3 |
358 | - 14 7 |
0 | 2 7 19 |
|||
* Including Dresden and Leipzig
At the end of 2014, the portfolio was valued at €2,718.8 million compared with €2,434.7 million at the end of 2013. This change was due to the following:
- the impact of disposals (-€147 million)
- the impact of acquisitions (+€358 million)
- the change in values on a like-for-like basis (+€73 million).
The following contribute to maintaining portfolio quality and its increased value: €13.8 million in OPEX work (i.e. €5.1/m²) and €44.3 million in CAPEX work (i.e. €16.5/m²) which was done in 2014.
8.2. Like-for-like change: +2.9%
| 8.2. Like-for-like change: +2.9% | ||||||||
|---|---|---|---|---|---|---|---|---|
| (€ millio n ) |
10 0 % va lu e ED 2 0 13 GS |
Va lu e ED 2 0 14 |
LFL c h a n g e 12 mo n th s |
Yie ld ED 2 0 13 |
Yie ld ED 2 0 14 |
% o f to ta l va lu e |
||
| Be rlin* |
586,9 | 971,8 | 5,9% | 5,4% | 5,9% | 36% | ||
| NRW | 1 847,8 | 1 747,0 | 6,9% | 7,0% | 6,9% | 64% | ||
| To ta l Ge rma n y |
2 4 3 4 , 7 |
2 7 18 , 8 |
2 , 9 % |
6 , 6 % |
6 , 5 % |
10 0 % |
||
* Including Dresden and Leipzig
On a like-for-like basis, values grew by +2.9%, including +4.9% on average on the Berlin portfolio.
E. OTHER ACTIVITIES
I. FRANCE Residential (100% FDL)
1. Accounted rental income:
| 1. Accounted rental income: | ||||||||
|---|---|---|---|---|---|---|---|---|
| (€ millio n ) |
Re n ta l in c o me 2 0 13 |
Re n ta l in c o me 2 0 14 |
Ch a n g e (%) |
% o f re n ta l in c o me |
||||
| P a ris a nd Ne uilly |
16 , 0 |
14 , 0 |
- 12,7% |
50% | ||||
| IDF Exc l. P a ris a nd Ne uilly |
6 , 0 |
5 , 4 |
- 10,6% |
19% | ||||
| Rhone s Alpe s |
3 , 4 |
2 , 8 |
- 15,9% |
10% | ||||
| P ACA |
4 , 2 |
4 , 1 |
- 2,1% |
15% | ||||
| La rge We st |
1, 9 |
1, 5 |
- 20,3% |
5 % |
||||
| Ea st |
0 , 4 |
0 , 4 |
- 4,8% |
1% | ||||
| To ta l Fra n c e |
3 1, 9 |
2 8 , 2 |
- 11, 6 % |
10 0 % |
||||
| To ta l Lu xe mb o u rg |
0 , 6 |
0 , 6 |
0 , 0 % |
10 0 % |
||||
| To ta l FDL |
3 2 , 5 |
2 8 , 8 |
- 11, 4 % |
10 0 % |
Rental income stood at €28.8 million in 2014, compared with €32.5 million in 2013. This change was due mainly to:
- the impact of disposals (- €2.1 million);
- the impact of vacant properties (- €2.4 million);
- the impact of acquisitions (+ €0.2 million);
- the impact of indexation (+ €0.6 million).
2. Annualised rental income: €26 million
| (€ millio n ) |
An n u a lis e d re n ta l in c o me 2 0 13 |
An n u a lis e d re n ta l in c o me 2 0 14 |
Ch a n g e (%) |
% o f re n ta l in c o me |
|---|---|---|---|---|
| P a ris a nd Ne uilly |
15,3 | 12 , 8 |
- 16% |
51% |
| IDF Exc lud. P a ris e t Ne uilly |
5,7 | 4 , 9 |
- 14% |
19% |
| Rhone s Alpe s |
3,1 | 2 , 4 |
- 23% |
9 % |
| P ACA |
4,3 | 3 , 8 |
- 12% |
15% |
| La rge We st |
1,8 | 1 | - 44% |
4 % |
| Ea st |
0,4 | 0 , 4 |
0 % |
2 % |
| To ta l Fra n c e |
30,6 | 2 5 , 3 |
- 17 , 2 % |
10 0 % |
| To ta l Lu xe mb o u rg |
0,6 | 0 , 6 |
0 , 0 % |
10 0 % |
| To ta l FDL |
31,1 | 2 5 , 9 |
- 16 , 9 % |
10 0 % |
3. Indexation
The index used to calculate the indexation in France is the IRL (Rental Reference Index). For commercial assets (retail and offices), the most widely used indexation is the ICC (Construction Cost Index).
4. Disposals and disposal agreements: €120 million
| 4. Disposals and disposal agreements: €120 million | ||||||||
|---|---|---|---|---|---|---|---|---|
| (€ m illion) |
Dis p o s a ls (a gre e me nts a s of e nd of 2013 c lose d) 1 |
Ag re e me n ts a s o f e n d o f 2 0 13 to c lo s e |
Ne w d is p o s a ls 2 0 14 2 |
Ne w a g re me n ts 2 0 14 |
To ta l 2 0 14 |
Ma rg in vs 2 0 13 va lu e |
Yie ld |
To ta l Dis p o s a ls = 1 + 2 |
| Fr a n ce |
17,0 | 0,1 | 84,2 | 35,5 | 119,7 | 5 ,6 % |
1 ,4 % |
101,2 |
| Tot al |
17 , 0 |
0 , 1 |
8 4 , 2 |
3 5 , 5 |
119 , 7 |
5,6% | 1,4% | 10 1, 2 |
Of all new commitments (€120 million), 60% were made in Paris and Neuilly-sur-Seine. The value of new commitments has increased by around 50% compared with the previous year.
5. Asset valuation
At the end of 2014, the Foncière Développement Logements (France and Luxembourg) portfolio was valued at €800 million with a like-for-like basis increase of 3.0% over the year.
This increase is mainly due to some major assets in Paris being transferred from a block value to an occupied retail value following a disposal commitment obtained on these assets, and to the compression of the capitalisation rates used by experts on some assets.
II. Logistics
1. Accounted rental income: 0.8% like-for-like
| 1. Accounted rental income: 0.8% like-for-like | ||||||||
|---|---|---|---|---|---|---|---|---|
| (M€) | S u rfa c e (s q m) |
Re n ta l in c o me 2 0 13 |
Re n ta l in c o me 2 0 14 |
Ch a n g e (%) |
Ch a n g e (%) LFL |
% o f to ta l |
||
| To ta l |
5 3 1 4 5 7 |
5 4 , 3 |
3 3 , 1 |
- 3 9 , 1% |
0 , 8 % |
10 0 % |
||
Rental income in 2014 amounted to €33.1 million, i.e. a decrease of 39.1% compared to the end of 2013. This change was due to:
- disposals made in 2013 and 2014 (-€21.3 million);
- indexation and staged rents (+€0.1 million);
- incoming and outgoing tenants (+€0.1 million);
- renewals (-€0.1 million).
Like-for-like, rental income increased by 0.8% (all of the Chalon site has now been leased).
2. Annualised rental income: €19.7 million
| 2. Annualised rental income: €19.7 million | |||||||
|---|---|---|---|---|---|---|---|
| (€ millio n ) |
S u rfa c e (s q m) |
Nu mb e r o f a s s e ts |
An n u a lis e d re n ta l in c o me 2 0 13 |
An n u a lis e d re n ta l in c o me 2 0 14 |
Ch a n g e (%) |
% o f re n ta l in c o me |
|
| To ta l |
5 3 1 4 5 7 |
9 | 5 6 , 2 |
19 , 7 |
- 6 4 , 9 % |
10 0 % |
|
Following disposals made in 2014, the annualised rents fell by 64.9%.
3. Indexation
In France, the indices used to calculate the indexation are those of the lCC and the ILAT. Collar rents account for 20% of annualised rental income.
4. Occupancy rate: 80,2%
The occupancy rate at 31 December 2014 was 80.2%, compared with 85.5% at 31 December 2013. This decrease is due to the change in scope of Logistics (major disposal in 2014). On the residual perimeter, the occupancy rate has increased, thanks to the marketing efforts of Pantin and Chalon.
| Oc c upa nc y ra te |
||
|---|---|---|
| (%) | 2 0 13 |
2 0 14 |
| To ta l |
8 5 , 5 % |
8 0 , 2 % |
5. Unpaid Rent
The impact of unpaid rent on the company's 2014 accounts was positive by €0.1 million, down by €1.8 million compared with the end of 2013 (the 2013 accounts were impacted by the forced liquidation of Telemarket).
6. Disposals and disposal agreements: €606 million
| 6. Disposals and disposal agreements: €606 million |
|||||||||
|---|---|---|---|---|---|---|---|---|---|
| (€ millio n ) |
Dis p o s a ls (a gre e me nts a s of e nd of 2013 c lose d) 1 |
Ag re e me n ts a s o f e n d o f 2 0 13 to c lo s e |
Ne w d is p o s a ls 2 0 14 2 |
Ne w a g re me n ts 2 0 14 |
To ta l 2 0 14 |
Ma rg in vs 2 0 13 va lu e |
Yie ld |
To ta l Dis p o s a ls = 1 + 2 |
|
| To ta l |
0 , 0 |
0 , 0 |
4 9 8 , 4 |
10 7 , 3 |
6 0 5 , 7 |
- 1, 2 % |
7 , 1% |
4 9 8 , 4 |
|
In 2014, Foncière des Régions continued its portfolio rotation policy:
- completion of several sales with a total value of €498 million (including the 17 logistics platforms sold to property funds managed by Blackstone);
- signature of a preliminary sale agreement in the second half of 2014 for a disposal planned for the first half of 2015.
7. Asset values
7.1 Change in asset values
| 7.1 Change in asset values | |||||||||
|---|---|---|---|---|---|---|---|---|---|
| (€ millio n ) |
Va lu e ED 2 0 13 |
Va lu e a d ju s tme n t |
Ac q u is itio n s |
Dis p o s a ls |
In ve s t. |
Tra n s fe rt |
Va lu e ED 2 0 14 |
||
| To ta l |
791 | - 9 |
0 | - 4 9 8 |
4 | 0 | 288 | ||
7.2 Change on a like-for-like basis
Appraised values on a like-for-like basis over one year declined by 1.5%. This change is mainly due to tenant departures being taken into account.
| departures being taken into account. | |||||||||
|---|---|---|---|---|---|---|---|---|---|
| (€ millio n ) |
Va lu e ED 2 0 13 10 0 % |
Va lu e ED 2 0 14 10 0 % |
Va lu e ED 2 0 14 G S |
LFL c h a n g e 12 mo n th s |
Yie ld ED 2 0 13 |
Yie ld ED 2 0 14 |
% o f to ta l va lu e |
||
| To ta l |
7 9 0 , 9 |
2 8 7 , 8 |
2 8 7 , 8 |
- 1, 5 % |
7 , 4 % |
7 , 2 % |
10 0 % |
||
The portfolio will worth €180.5 million, post disposals planned in half-year 2015.
4. Financial information and comments
The activity of Foncière des Régions consists of the acquisition, ownership, administration and leasing of properties, developed or otherwise, specifically in the Office, Residential, Hotels and Service, Logistics, and Car Parks sectors.
Registered in France, Foncière des Régions is a limited company (société anonyme) with a Board of Directors.
The financial statements were approved by the Board of Directors on 19 February 2015. The audit procedures on the consolidated financial statements have been completed. The certification report will be issued after the specific verifications. The review report is being issued.
CONSOLIDATED ACCOUNTS
A. Scope of consolidation
At 31 December 2014, the scope of consolidation of Foncière des Régions includes companies in France and nine other countries in Europe (Offices: Italy Residential: Germany, Austria, Denmark; Hotels & Service Sector: Germany, Portugal, Belgium, the Netherlands and Luxembourg). The main percentages of control during the year were as follows:
| 2 0 13 |
2 0 14 |
|---|---|
| 59,7% | 61,3% |
| 28,3% | 28,5% |
| N/A | 60,9% |
| 50,9% | 48,3% |
| 75,0% | 75,0% |
| 59,5% | 59,5% |
| 60,0% | 60,0% |
| 50,1% | 50,1% |
| 50,1% | 50,1% |
| 50,1% | 50,1% |
Foncière des Régions increased its stake in Foncière Développement Logements following the Public Exchange Offer in August 2013. As a result of the offer, Foncière des Régions holds 59.7% of Foncière Développement Logements, which has been fully consolidated since 1 August.
In July 2014, Foncière Développement Logements sold its equity interests in the German Residential sector to its shareholders. Foncière des Régions currently holds 60.9% of the German Residential sector via Immeo.
In addition, the completion in September of the Foncière Développement Logements share buyback offer and the cancellation of shares raised Foncière Développement Logements ownership stake in Foncière des Régions to 61.26%.
On 27 October, Foncière des Régions participated in the capital increase of Beni Stabili, and it now holds 48.3% of Beni Stabili's capital.
Foncière des Régions increased its equity interest in Foncière des Murs following capital increase in November 2014, and it now owns 28.46% of Foncière des Murs.
B . Accounting standards
The consolidated financial statements have been prepared in accordance with the international accounting standards issued by the IASB (International Accounting Standards Board) and adopted by the European Union on the date of preparation. These standards include the IFRS (International Financial Reporting Standards), as well as their interpretations. The financial statements were approved by the Board of Directors on 19 February 2015.
C. EPRA Income Statements
| C. EPRA Income Statements | |||||||||
|---|---|---|---|---|---|---|---|---|---|
| 2013 | 2014 be fore re class ification |
Discontinued o pe rations |
2014 | 2013 | 2014 be fore re classification |
Discontinued operations |
2014 | $\frac{0}{0}$ | |
| Rentalincome | 832.0 | 908,4 | 33.1 | 875,4 | 525.7 | 558.1 | 33.1 | 525.0 | 6.2% |
| Unrecovered rental costs | $-40.0$ | $-44.0$ | $-4.6$ | $-39.4$ | $-26.6$ | $-27.9$ | $-4.6$ | $-23.3$ | 4.9% |
| Expenses on properties | $-18.3$ | $-29.0$ | $-0.9$ | $-28.0$ | $-11.4$ | $-17.8$ | $-1.0$ | $-16.9$ | 56.1% |
| Net expenses on unrecoverable receivables | $-8, 8$ | $-8,6$ | 0,1 | $-8,7$ | $-5.3$ | $-5,1$ | 0,3 | $-5,4$ | $-3,8%$ |
| Net rental income | 764,8 | 826,9 | 27,7 | 799,2 | 482,4 | 507,3 | 27,6 | 479,6 | 5, 2% |
| ratio of costs to revenues | 8.1% | 9,0% | 0.0% | 8,7% | 8,2% | 9.1% | $0.0\%$ | 8.7% | 0.0% |
| Management and administration revenues | 22,2 | 23,7 | 0,3 | 23,4 | 21.1 | 23.3 | 0,3 | 23,0 | 10% |
| Ac tivity-related costs | $-4,9$ | $-5,7$ | $-0.3$ | $-5,4$ | $-3.7$ | $-3.6$ | $-0.3$ | $-3.3$ | $-3%$ |
| Committed fixed costs | $-82.7$ | $-104.0$ | $-1.0$ | $-103.0$ | $-61.5$ | $-74.7$ | $-1.0$ | $-73.7$ | 2.1% |
| De ve lopment costs | $-0.5$ | $-0.2$ | 0,0 | $-0,2$ | $-0,4$ | $-0,2$ | 0,0 | $-0.2$ | $-50%$ |
| Net cost of operations | $-65,9$ | $-86,3$ | $-1,0$ | $-85,3$ | $-44,4$ | $-55,2$ | $-1,0$ | $-54,2$ | 24% |
| Income from other activities | 19,5 | 26.9 | 0.0 | 26.9 | 13.8 | 21.5 | 0.0 | 21.5 | 56% |
| Depreciation of operating assets | $-15,0$ | $-15,6$ | 0,0 | $-15,6$ | $-10,1$ | $-10.3$ | 0,0 | $-10,3$ | 2% |
| Netchange in provisions and other | 2.1 | $-19.1$ | $-2,7$ | $-16.4$ | 1,9 | $-9.9$ | $-2.6$ | $-7.2$ | n.a |
| Current operating income | 705.5 | 732.9 | 24.0 | 708.9 | 443,6 | 453.4 | 24.0 | 429.4 | 2% |
| Net income from inventory properties | $-5,2$ | $-2,1$ | 0.0 | $-2,1$ | $-2.5$ | $-1,2$ | 0,0 | $-1,2$ | $-52%$ |
| Income from asset disposals | 3.7 | $-5.9$ | $-8.0$ | 2.0 | $-1.3$ | $-7.1$ | $-8.0$ | 0.9 | n.a |
| Income from value adjustments | $-37.7$ | 158.7 | $-8.6$ | 167.4 | $-40.2$ | 102.0 | $-8.6$ | 110.6 | n.a |
| Income from disposal of securities | 3,8 | 0,0 | 0,0 | 0,0 | 3,8 | 0,0 | 0,0 | 0,0 | n.a |
| Income from changes in scope | 48,8 | 32,5 | 30,6 | 1,9 | 48,8 | 31,8 | 30,5 | 1.3 | n.a |
| Operating income | 719.0 | 916.1 | 37.9 | 878.2 | 452,1 | 578,9 | 38.0 | 540.9 | 28% |
| Income from non-consolidated companies | 10,1 | 0.9 | 0,0 | 0,9 | 10,1 | 0.9 | 0,0 | 0.9 | $-91%$ |
| Cost of net financial debt | $-307.4$ | $-289.1$ | $-7.0$ | $-282,2$ | $-192.0$ | $-175.0$ | $-7.0$ | $-168.1$ | $-9%$ |
| Value adjustment on derivatives | 110.0 | $-311.4$ | $-7.7$ | $-303.7$ | 71.7 | $-190.9$ | $-7.7$ | $-183.2$ | n.a |
| Discounting of liabilities and receivables | $-2,9$ | $-3.4$ | $-0.1$ | $-3,3$ | $-2,8$ | $-3,4$ | $-0.1$ | $-3.2$ | 2 1% |
| Netchange in financial and other provisions | $-47,7$ | $-124.0$ | 0,0 | $-124,0$ | $-25.0$ | $-65.3$ | 0.0 | $-65,4$ | n.a |
| Share in earnings of a ffiliates | 32.5 | 21.1 | 0.0 | 21.1 | 29,3 | 19.8 | 0.0 | 19.8 | $-32%$ |
| Pre-tax income | 513,6 | 210,1 | 23,1 | 187,0 | 343,5 | 164,9 | 23,2 | 141,7 | $-52%$ |
| De fe rred tax | 6,2 | $-80.6$ | 0.5 | $-81.1$ | 1.4 | $-40.0$ | 0.1 | $-40.1$ | n.a |
| Corporate income tax | $-7.6$ | $-9.9$ | 0.4 | $-10.3$ | $-4,8$ | $-6.4$ | 0.4 | $-6.8$ | 33% |
| Net income from continuing operations | 512,1 | 119,6 | 0, 0 | 95,6 | 0, 0 | 118,5 | 23,7 | 94,8 | $0\%$ |
| Post-tax profit or loss of discontinued operations | 0.0 | 0.0 | 0.0 | 24.0 | 0.0 | 0.0 | 23.7 | 0% | |
| Net income from discontinued operations | 0.0 | 0.0 | 0.0 | 24.0 | 0.0 | 0, 0 | 23.7 | $0\%$ | |
| Net income for the periode | 512,1 | 119,6 | 24,0 | 119,6 | 0, 0 | 118,5 | 23,7 | 118,5 | $-65%$ |
| Non-controlling interests | $-172.0$ | $-1.1$ | 0.0 | $-1.1$ | 0.0 | 0.0 | 0.0 | 0.0 | 0% |
| Net income for the period - GS | 340.1 | 118.5 | 24.0 | 118.5 | 340.1 | 118.5 | 23.7 | 118.5 | $-65%$ |
Rental income
Rental Income (before reclassification of Logistics as Discontinued Operations) rose by 6.2% to €558.1 million, Group share (vs €525.7 million). This increase can be explained primarily through the consolidation on a full-year basis of the residential business, adding €75 million, as well as the following:
- o asset acquisitions and deliveries (+ €6,4 million);
- o disposals (- €46.2 million, of which €21.3 million related to disposals in Logistics);
- o indexation and the mixed effect from departures and re-lettings (- €0.3 million).
In consolidated data, rental income increased by 9.2% (+ €76 million):
- o Germany Residential: + €107.3 million
- o France Residential : + €15.8 million
- o Offices France: €14.5 million (-5.5%)
- o Offices Italy: €3.0 million (-1.3%)
- o Hotels and Service Sector: €7.9 million (-3.9%)
- o Logistics: €21.2 million (-39.1%)
Net operating costs
Net operating costs amounted to €55.2 million, Group share, at 31 December 2014 (€86.3 million on a consolidated basis) compared to €44.4 million at 31 December 2013 (€65.9 million on a consolidated basis), for an increase of 24.3%. This increase is related primarily to the integration of Residential activity on a full-year basis. Stripping out the impact of Residential, net operating costs fell during 2014. These overhead expenses mainly consist of payroll, attorneys' fees, auditors' fees, and office, communications and IT costs.
Other business income
Other business income mainly concerned the "Car Parks" activity (€7.6 million), i.e. car parks owned or under concession, as well as real estate development activities. Net income from these activities rose during 2014 due mainly to real estate development activity (€5.5 million). Other business income stood at €21.5 million at 31 December 2014 (Group share), compared to €13.8 million at 31 December 2013.
Depreciation and provisions
Allowances for depreciation and provisions during the period consisted largely of depreciation on operating properties and car parks.
Change in the fair value of assets
The income statement recognises changes in the fair value of assets based on appraisals conducted on the portfolio. During 2014, the change in the fair value of investment assets was positive by €102.0 million for the Group share and €158.7 million on a consolidated basis, versus - €40.2 million (Group share) at 31 December 2013 (- €37.7 million at 100%).
Operating income, Group share, thus amounted to €578.9 million at 31 December 2014 compared to €452.1 million at 31 December 2013.
Financial aggregates
Financial expenses stood at €175 million in Group share (compared to €191.4 million at 31 December 2013) and at €289.1 million on a consolidated basis (vs €307.4 million at 31 December 2013). The amount of interest capitalised on assets under development amounted to €15 million (Group share) for 2014.
In addition, financial instruments both assets and liabilities (before reclassification of Discontinued Operations) represented a net balance sheet amount of €580.3 million (€384.4 million for the Group share) and deferred tax liabilities from non-SIIC foreign companies accounted for €244.6 million (€127.4 million Group share).
The change in the fair value of financial instruments was negative €190.9 million in Group share at 31 December 2014. (-€311.4 million on a consolidated basis), compared to positive €71.7 million in Group share (+€110 million on a consolidated basis) at 31 December 2013. This was after a drop in long-term rates and a change in the fair value of the ORNANE between 2013 and 2014 (-€52.7 million, Group share and €69.2 million at 100%).
| Share of income of associates |
|||||||||
|---|---|---|---|---|---|---|---|---|---|
| % in te re s t |
Va lu e 2 0 13 |
Co n trib u tio n to e a rn in g s |
Va lu e 2 0 14 |
Ch a n g e (%) |
|||||
| 19,90% | 71,8 | 1,3 | 69,2 | 3,8% | |||||
| 50,10% | 95,3 | 5,4 | 92,8 | 2,7% | |||||
| 50,10% | 6,9 | 7,0 | 13,8 | - 50,0% |
|||||
| 0,00% | 10,8 | 7,4 | 12,9 | - 16,4% |
|||||
| 18 4 , 8 |
2 1, 1 |
18 8 , 7 |
- 2,1% |
||||||
Share of income of associates
Income (loss) from changes in consolidation scope
The income from changes in consolidation scope corresponded mainly to the impact to net profit from the disposal of the Logistics companies for €30.5 million (Garonor France III in particular).
Income from non consolidated companies
Income from non-consolidated companies corresponds to OPCI Technical Fund dividends for €0.9 million.
Taxes
Taxes determined are for:
- o foreign companies not covered or only partially covered by a specific scheme for real estate businesses;
- o French subsidiaries not having opted for the SIIC regime;
- o French SIIC or Italian subsidiaries with taxable activity.
Note that the change in the Italian SIIQ tax regime resulted in the cancellation of €30 million (Group share) in net deferred tax assets.
EPRA Net Recurring Income
| 2014 be fore $(\epsilon$ million) $\frac{0}{0}$ 2013 Change re c la s s ific a ti Group share $\mathbf{o}$ n Netrentalincome 24,7 483.8 508,5 5,1% Net operating costs $-42,7$ $-54,2$ $-11.5$ 26,9% In come from other activities 21,2 14,4 6,8 47,2% 0,0 Net change in provisions and other 0,2 $-0,2$ n.a Cost of net financial debt $-190.4$ $-173,5$ 16,9 $-8.9%$ Recurrent net income from equity a ffiliates $-9,2$ $-39,3%$ 23.4 14.2 Income from non consolidated affiliates 0,9 10.1 $-9,2$ n.a $-2,2$ $-2,7$ $-0,5$ Recurrent tax 22,7% EPRA recurrent net income 6,0% 296,7 3 14,5 17,8 5,0 5,0 0,1 EPRA recurrent net income per share 1,1% Fair value adjustment on real estate assets $-40,2$ 102,0 142,2 n.a $-34,2$ $-8,3$ 25.9 Other asset value adjustments n.a Fair value adjustment on financial instruments $-262,6$ 71,7 $-190,9$ n.a Other 48.8 $-55,1$ $-103,9$ n.a $-2,7$ $-43.7$ $-41,0$ Non-recurrent tax n.a 340,1 Net income 118, 5 $-221,6$ $-65, 2%$ |
EPRA Net Recurring Income ۰ |
||||
|---|---|---|---|---|---|
| Diluted average number of shares | 59 632 122 | 62 538 274 | 2906152 | 4,9% |
| Diluted average number of shares | 59632122 | 62 538 274 | 2906.152 | 4,9% |
|---|---|---|---|---|
| Net income GS |
Restatements | EPRA RNI |
||
| Net rental income | 507,3 | 1,3 | 508,5 | |
| Operating costs | $-55.2$ | 0.9 | $-54.2$ | |
| Income from other activities | 21.5 | $-0,3$ | 21,2 | |
| Depreciation of operating assets | $-10,3$ | 10,3 | 0,0 | |
| Netchange in provisions and other | $-9.9$ | 9,9 | 0,0 | |
| Current operating income | 453,4 | 22,1 | 475,5 | |
| Net income from inventory properties | $-1,2$ | 1,2 | 0,0 | |
| Income from asset disposals | $-7,1$ | 7,1 | 0,0 | |
| Income from value adjustments | 102,0 | $-102,0$ | 0.0 | |
| Income from disposal of securities | 0.0 | 0,0 | 0,0 | |
| Income from changes in scope | 31.8 | $-31.8$ | 0,0 | |
| Operating income | 578,9 | $-103,4$ | 475,5 | |
| Income from non-consolidated companies | 0.9 | 0,0 | 0,9 | |
| Cost of net financial debt | $-175,0$ | 1,6 | $-173,5$ | |
| Value adjustment on derivatives | $-190.9$ | 190,9 | 0,0 | |
| Discounting of liabilities and receivables | $-3,4$ | 3,4 | 0,0 | |
| Netchange in financial provisions | $-65,4$ | 65,4 | 0,0 | |
| Share in earnings of a ffiliates | 19,8 | $-5,5$ | (a) | 14,3 |
| Pre-tax net income | 164.9 | 152,3 | 317,2 | |
| De fe me d ta x | $-40.0$ | 40,0 | 0,0 | |
| Corporate income tax | $-6,4$ | 3,7 | $-2,7$ | |
| Net income for the period | 118,5 | 196,0 | 314,5 | |
| (a) Non cash amount from the result of affiliates |
(a) Non cash amount from the result of affiliates
D. Balance sheet
Consolidated balance sheet
| 2 0 13 |
H1 2 0 14 b e fo re |
Dis c o n tin u e |
2 0 13 |
H1 2 0 14 b e fo re |
Dis c o n tin u e |
||||
|---|---|---|---|---|---|---|---|---|---|
| (€ millio n ) |
re c la s s ific a tio n |
d o p e ra tio n s |
2 0 14 |
re c la s s ific a tio n |
d o p e ra tio n s |
2 0 14 |
|||
| No n - c u rre n t a s s e ts |
S h a re h o ld e rs ' e q u ity |
||||||||
| Ca pita l |
188 | 188 | 0 | 188 | |||||
| Inta ngible a sse ts |
154 | 145 | 0 | 145 | Additiona l pa id- in c a pita l |
2 371 | 2 291 | 0 | 2 291 |
| Tre a sury stoc k |
- 11 |
- 4 |
0 | - 4 |
|||||
| Ta ngible a sse ts |
108 | 8 0 |
0 | 8 0 |
Consolida te d re se rve s |
1 402 | 1 564 | 0 | 1 564 |
| Inve stme nt prope rtie s |
14 298 | 14 535 | 0 | 14 535 | Ea To rnings ta l s h a re h o ld e rs ' e q u ity Gro u p |
340 | 119 | 0 | 119 |
| 0 | 0 | 0 | 0 | s h a re |
4 2 9 0 |
4 15 8 |
0 | 4 15 8 |
|
| Fina nc ia l a sse ts |
156 | 185 | 0 | 185 | Non- c ontrolling inte re sts |
2 925 | 3 142 | 0 | 3 142 |
| Equity a ffilia te s |
185 | 189 | 0 | 189 | To ta l s h a re h o ld e rs ' e q u ity (I) |
7 2 15 |
7 3 0 0 |
0 | 7 3 0 0 |
| De fe rre d ta x a sse ts |
9 0 |
17 | 0 | 17 | No n - c u rre n t lia b ilitie s |
||||
| Long- te rm fina nc ia l instrume nts |
12 | 3 9 |
0 | 3 9 |
|||||
| Long- te rm borrowings |
7 520 | 7 709 | 7 | 7 702 | |||||
| Long- te rm fina nc ia l instrume nts |
476 | 540 | 2 0 |
520 | |||||
| To ta l n o n - c u rre n t a s s e ts (I) |
15 0 0 2 |
15 18 9 |
0 | 15 18 9 |
De fe rre d ta x lia bilitie s |
295 | 261 | 0 | 261 |
| Cu rre n t a s s e ts |
P e nsion a nd othe r lia bilitie s |
4 1 |
4 4 |
0 | 4 4 |
||||
| Othe r long- te rm de bt |
3 8 |
10 | 4 | 7 | |||||
| Asse ts he ld for sa le |
1 197 | 825 | 288 | 537 | To ta l n o n - c u rre n t lia b ilitie s (III) |
8 3 6 9 |
8 5 6 4 |
3 0 |
8 5 3 4 |
| Loa ns a nd fina nc e le a se re c e iva ble s |
10 | 8 | 0 | 8 | Cu rre n t lia b ilitie s |
||||
| Inve ntorie s a nd work- in- progre ss |
8 0 |
7 3 |
0 | 7 3 |
Lia bilitie s he ld for sa le |
||||
| S hort- te rm fina nc ia l instrume nts |
11 | 2 1 |
0 | 2 1 |
Tra de pa ya ble s |
110 | 9 0 |
3 | 8 7 |
| Tra de re c e iva ble s |
283 | 277 | 13 | 264 | S hort- te rm borrowings |
979 | 1 204 | 0 | 1 204 |
| Curre nt ta x |
3 | 7 | 4 | 3 | S hort- te rm fina nc ia l instrume nts |
9 5 |
101 | 3 | 9 8 |
| Othe r re c e iva ble s |
202 | 127 | 4 | 123 | Te na nt se c urity de posits Adva nc e s a nd de posits re c e ive d on c urre |
6 nt |
5 | 0 | 5 |
| Ac c rue d e xpe nse s |
12 | 10 | 0 | 10 | orde rs |
134 | 146 | 7 | 139 |
| Ca sh a nd c a sh e quiva le nts |
382 | 1 029 | 2 | 1 027 | S hort- te rm provisions |
17 | 17 | 0 | 17 |
| Disc ontinue d ope ra tions |
0 | 0 | 0 | 311 | Curre nt ta x |
5 | 6 | 0 | 5 |
| Othe r de bt |
5 | 6 | 0 | 204 | |||||
| Ac c rua ls |
4 7 |
3 7 |
0 | 3 7 |
|||||
| Disc ontinue d ope ra tions |
0 | 0 | 0 | 5 4 |
|||||
| To ta l c u rre n t a s s e ts (II) |
2 17 9 |
2 3 7 6 |
3 11 |
2 3 7 7 |
To ta l c u rre n t lia b ilitie s (IV) |
1 5 9 7 |
1 7 0 2 |
2 4 |
1 7 3 2 |
| To ta l a s s e ts (I+ II+ III) |
17 18 1 |
17 5 6 6 |
3 11 |
17 5 6 6 |
To ta l lia b ilitie s (I+ II+ III+ IV) |
17 18 1 |
17 5 6 6 |
5 4 |
17 5 6 6 |
Simplified consolidated balance sheet
| Simplified consolidated balance sheet |
||||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| As s e ts |
2 0 14 b e fo re re c la s s ific a tio n |
2 0 14 |
Lia b ilitie s |
2 0 14 b e fo re re c la s s ific a tio n |
2 0 14 |
|||||
| Fixe d a sse ts |
14 760 | 14 760 | S ha re holde rs' e quity |
4 158 | 4 158 | |||||
| Equity a ffilia te s |
189 | 189 | Non- c ontrolling inte re sts |
3 142 | 3 142 | |||||
| Fina nc ia l a sse ts |
185 | 185 | S h a re h o ld e rs ' e q u ity |
7 3 0 0 |
7 3 0 0 |
|||||
| De fe rre d ta x a sse ts |
17 | 17 | Borrowings | 8 913 | 8 906 | |||||
| Fina nc ia l instrume nts |
6 0 |
6 0 |
Fina nc ia l instrume nts |
641 | 618 | |||||
| Ac tifs de stiné s à la ve nte |
825 | 537 | De fe rre d ta x lia bilitie s |
261 | 261 | |||||
| Ca sh |
1 029 | 1 027 | Disc ontinue d ope ra tions |
5 4 |
||||||
| Disc ontinue d ope ra tions |
311 | Othe r lia bilitie s |
451 | 427 | ||||||
| Othe r |
502 | 481 | ||||||||
| To ta l |
17 5 6 6 |
17 5 6 6 |
To ta l |
17 5 6 6 |
17 5 6 6 |
Simplified balance sheet, Group share
| Simplified balance sheet, Group share |
|||||||||
|---|---|---|---|---|---|---|---|---|---|
| As s e ts |
2 0 14 b e fo re re c la s s ific a tio n |
2 0 14 |
Lia b ilitie s |
2 0 14 b e fo re re c la s s ific a tio n |
2 0 14 |
||||
| Fixe d a sse ts |
8 650 | 8 650 | |||||||
| Equity a ffilia te s |
139 | 139 | |||||||
| Fina nc ia l a sse ts |
181 | 181 | S h a re h o ld e rs ' e q u ity |
4 15 8 |
4 15 8 |
||||
| De fe rre d ta x a sse ts |
8 | 8 | Borrowings | 5 765 | 5 758 | ||||
| Fina nc ia l instrume nts |
5 5 |
5 5 |
Fina nc ia l instrume nts |
439 | 417 | ||||
| Asse ts he ld for sla le |
661 | 373 | De fe rre d ta x lia bilitie s |
135 | 135 | ||||
| Ca sh |
803 | 801 | Othe r |
339 | 314 | ||||
| Disc ontinue d ope ra tions |
311 | Disc ontinue d ope ra tions |
5 4 |
||||||
| Othe r |
339 | 318 | |||||||
| To ta l |
10 8 3 6 |
10 8 3 6 |
To ta l |
10 8 3 6 |
10 8 3 6 |
||||
Shareholders' equity
Consolidated shareholders' equity, Group share, fell from €4,290 million at the end of 2013 to €4,158 million at 31 December 2014, i.e. a decrease of €132.1 million due mainly to:
o income for the period: + €118.5 million;
- o financial instruments included in shareholders' equity: + €42.5 million;
- o impact of the cash dividend distribution: €262.7 million;
- o change percentage of Beni Stabili held: €30.2 million;
- o structuring of residential sector: €2.8 million.
Net debt
Foncière des Régions' bank loans amounted to €5,727 million in Group share, and €8,893 million on a consolidated basis. Net debt at 31 December 2014 was €4,962 million (Group share) and €7,884 million (on a consolidated basis), compared to €5,098 million (Group share) and €8,117 (consolidated) at the end of 2013. The net debt decreased by €136 million (Group share) and €233 million on a consolidated basis.
5. Net Assets Value (NAV)
| Va r. |
Va r. (%) |
|||
|---|---|---|---|---|
| 2 0 13 |
2 0 14 |
vs 2 0 13 |
vs 2 0 13 |
|
| EP RA NAV (€ millio n ) |
4 871,1 | 4 7 5 3 , 5 |
- 117,6 |
- 2,4% |
| EP RA NAV / s h a re (€) |
77,7 | 7 5 , 5 |
- 2,2 |
- 2,8% |
| EP RA triple ne t NAV (€ million) |
4 342,1 | 4 14 5 , 1 |
- 196,9 |
- 4,5% |
| EP RA triple ne t NAV / sha re (€) |
69,2 | 6 5 , 9 |
- 3,4 |
- 4,9% |
| Numbe r of sha re s |
62 708 431 | 6 2 9 4 1 7 12 |
233 281 | 0,4% |
| (€ millio n ) |
€/s h a re |
|
|---|---|---|
| S h a re h o ld e rs ' e q u ity |
4 15 8 , 0 |
6 6 , 1 |
| Fa ir va lue a sse ssme nt of buildings (ope ra tion + inve ntory) |
27,1 | |
| Fa ir va lue a sse ssme nt of pa rking fa c ilitie s |
34,0 | |
| Fa ir va lue a sse ssme nt of goodwill |
1,9 | |
| Fixe d de bt |
- 93,4 |
|
| Re sta te me nt of va lue ED |
17,5 | |
| EP RA trip le n e t NAV |
4 14 5 , 1 |
6 5 , 9 |
| Fina nc ia l instrume nts a nd fix ra te de bt |
407,4 | |
| De fe rre d ta x |
127,4 | |
| ORNANE | 73,6 | |
| EP RA NAV |
4 7 5 3 , 5 |
7 5 , 5 |
| IFRS NAV |
4 15 8 , 0 |
6 6 , 1 |
Valuation work is carried out in accordance with the code of conduct applicable to SIICs, and in accordance with the Charter of property valuation expertise, the recommendations of the COB/CNCC working group chaired by Mr Barthès de Ruyther and the international plan in accordance with European TEGoVA standards and those of the Red Book of the Royal Institution of Chartered Surveyors (RICS).
The property portfolio directly held by the Group underwent a complete valuation on 31 December 2014 by independent property experts such as REAG, DTZ Eurexi, CBRE, JLL, BNP Paribas Real Estate, Cushman and Yard Valtech.
Assets were estimated at values excluding and/or including duties, and rents at market value. Estimates were made using the comparative method, the rent capitalisation method and the discounted future cash flows method.
Car parks were valued by capitalising the gross operating surplus generated by the business.
Other assets and liabilities were valued using the principles of the IFRS standards on consolidated accounts. The application of the fair value essentially concerns the valuation of the debt coverages and the ORNANES. The level of exit tax is known and included in the financial statements for all of the companies that have opted for the fiscal transparency system.
For companies shared with other investors, only the Group share was taken into account.
Fair value adjustment for the buildings and business goodwill
In accordance with IFRS standards, properties in operation and in inventory are valued at historical cost. A value adjustment, in order to take into account the appraisal values, is recognised in the NAV for a total amount of €27.1 million.
Since goodwill is not valued in the consolidated accounts, a restatement to recognise its fair value (as calculated by the appraisers) was made in the NAV in the amount of €2.0 million at 31 December 2014.
Fair value adjustment for the car parks
Car parks are valued at historical cost in the consolidated financial statements. A restatement is made in the NAV to take into account the appraisal value of these assets, as well as the effect of the farm-outs and subsidies received in advance. The impact on the RNA was €34.0 million at 31 December 2014.
Recalculation of the base cost excluding duties of certain assets
When a company, rather than the asset that it holds, can be sold off, transfer duties are recalculated based on the company's net asset value. The difference between these recalculated duties and the transfer duties already deducted from the value of the assets generates a restatement of €17.5 million at 31 December 2014.
Fair value adjustment for fixed-rate debts
The group has taken out fixed-rate loans. In accordance with EPRA principles, triple net NAV is adjusted by the fair value of fixed-rate debts, with an impact of - €93.4 million at 31 December 2014.
6. Financial resources
A. Main debt characteristics capitalised
| G S |
2 0 13 |
2 0 14 |
|---|---|---|
| Ne t de bt, Group sha re (€ million) |
5 098 | 4 9 6 2 |
| Ave ra ge a nnua l ra te of de bt |
3,94% | 3 , 2 9 % |
| Ave ra ge ma turity of de bt (in ye a rs) |
4,5 | 4 , 1 |
| De bt a c tive he dging spot ra te |
80% | 84% |
| Ave ra ge ma turity of he dging |
4,9 | 5 , 1 |
| LTV Inc luding Dutie s |
46,5% | 4 6 , 1% |
| ICR | 2,49 | 2 , 7 6 |
6.1. Debt by type
The net debt, Group share, of Foncière des Régions amounted at 31 December 2014 to €5 billion (€7.9 billion on a consolidated basis).
As a share of total debt, non-mortgage debt rose from 48% at 31 December 2013 to 60% at 31 December 2014, due in particular to the issue of new bonds during the financial year totalling €0.8 billion for the year (€1.1 billion on a consolidated basis).
In addition, at the end of 2014, the cash and cash equivalents of Foncière des Régions totalled nearly €1.9 billion, Group share (€2.5 billion on a consolidated basis). These amounts do not include the unused portion of loans allocated to development projects under way.
6.2. Debt maturities
The average maturity of Foncière des Régions debt was 4.1 years at the end of 2014.
The 2015 and 2016 maturities are covered entirely by existing cash. Maturities for 2015 mainly affect Beni Stabili (€222 million Group share and €459 million on a consolidated basis) and Foncière des Régions (€80 million):
6.3. Main changes during the period
New debt issues: €3,125 million at 100% (€1,908 million, Group Share)
- o Foncière des Régions: €799 million (€799 million, Group share):
- During the second half of 2014, Foncière des Régions continued the process it began in 2013 of renegotiating its corporate credit facilities to optimise their financial conditions and extend their maturity. As a result, €260 million in corporate credit facilities were renegotiated or refinanced. In addition, €39 million in new corporate debts were taken out;
- In September 2014, Foncière des Régions issued a bond of €500 million with a maturity of September 2021 and a fixed coupon of 1.75%, for a spread of 105 bps. This strategy enabled the extensive diversification of financing sources, reduction in cost of debt and extension of its maturity to continue.
- o Beni Stabili: €1,276 million raised in 2014 (€636 million Group share):
-
Beni Stabili placed a €350 million, unsecured inaugural bond issue in January 2014 with an annual coupon of 4.125% and maturing in four years, i.e. in January 2018;
-
In March 2014, Beni Stabili successfully completed a private placement with institutional investors for a total of €250 million with a 3.50% coupon. The bond matures in April 2019;
- In September 2014, Beni Stabili refinanced the IMSER securitisation collateralised by the €1.7 billion Telecom Italia real property portfolio via the creation of €300 million of mortgage financing and €200 million in corporate financing. This refinancing significantly reduced Beni Stabili's average cost of debt while increasing its financial flexibility;
- Finally, during the year, Beni Stabili renegotiated three existing funding sources totalling €116 million and took out €60 million in new bank loans.
- o Hotels and Service sector: €487 million raised in 2014 (€137 million in Group share):
- In May 2014, Foncière des Murs took out €209 million in loans backed by a diversified asset portfolio mainly comprised of hotel assets, to:
- o refinance the balance of mortgage loans set up in 2007;
- o refinance the €60 million mortgage loan taken out in 2013 to optimise the financial conditions of the facility;
- In December 2014, Foncière des Murs extended its covered bond by two years using €242 million in hotel assets for a coupon reduced to 2.75% starting on 16 February 2015;
- Foncière des Murs also raised €35 million in new mortgage financing as part of its acquisitions.
- o Residential France: €350 million raised in 2014 (€209 million in Group share):
- Foncière Développement Logements refinanced the Stockholm 1 and 2 loans in January 2014 with new debt for a nominal amount of €350 million.
- o Residential Germany: €213 million raised in 2014 (€127 million in Group share):
- In Germany, Immeo raised €68 million in new financing for four- and five-year maturities, which are to be used to finance the acquisition of housing portfolios in Berlin, Dresden and Leipzig;
- In October 2014, Immeo also took out mortgage acquisition loans totalling €145 million with a ten-year maturity, backed by an asset portfolio consisting of 3,500 residential units in Berlin and Dresden.
6.4. Hedging profile
During the 2014 financial year, the hedge management policy remained unchanged, with debt hedged at 90% to 100%, at least 75% of which had short-term hedges and all of which have maturities exceeding debt maturity.
Based on net debt at the end of December 2014, Foncière des Régions is covered (in Group Share) up to 87% in short term hedges, compared to 94% at the end of 2013. The average hedge duration is 5.1 years in Group share.
6.5. Average interest rate on the debt and sensitivity
The average rate on the debt of Foncière des Régions stood at 3.3% in Group share, compared to 3.9% in 2013. This decrease occurred mainly due to the refinancing of Beni Stabili's securitised debt in September, a new 7 year, 1.75% bond issue in September on Foncière des Régions for €500 million and the full-year impact of the 2013 renegotiations and hedge restructuring.
For information purposes, a 50 bps drop in the 3-month Euribor rate would have a positive impact of €0.5 million on net recurring income for 2015. The impact would be negative by €3.6 million in the event of a 50 bps hike.
FINANCIAL STRUCTURE
Excluding debts raised without recourse to the group's property companies, the debts of Foncière des Régions and its subsidiaries generally include bank covenants (ICR and LTV) applying to the borrower's consolidated financial statements. If these covenants are breached, early debt repayment may be required. These covenants are established in Group share for Foncière des Régions and for Foncière des Murs and on a consolidated basis for the subsidiaries of Foncière des Régions (if their debts include them).
- o The most restrictive consolidated LTV covenants at 31 December 2014 amounted to 60% for Foncière des Régions, Foncière des Murs, Foncière Développement Logements and Beni Stabili.
- o The threshold for consolidated ICR covenants differs from one REIT to another, depending on the type of assets, and may be different from one debt to another even for the same REIT, depending on debt seniority.
The most restrictive ICR consolidated covenant applicable to the property investment companies are the following:
- for Foncière des Régions: 200%;
- for Foncière des Murs: 200%;
- for Foncière Développement Logements: 150%;
- for Beni Stabili: 140%;
- Furthermore, in some scopes financed using dedicated debt, there are specific covenants which may be added to or replace the consolidated covenants.
With respect to Immeo, for which the debt raised is "non-recourse" debt, there are no consolidated covenants associated with portfolio financing.
Lastly, concerning Foncière des Régions, corporate credits have been amended following 2013 renegotiations. In particular, for some they include the following ratios:
| Ra tio |
Co ve n a n t |
2 0 14 |
||
|---|---|---|---|---|
| LTV | 60,0% | 50,3% | ||
| ICR | 200,0% | 276,0% | ||
| S e c ura l de bt ra tio |
22,5% | 7,7% |
All covenants were fully complied with at the end of 2014. No loan has an accelerated payment clause contingent on a Foncière des Régions rating.
LTV calculation details
| €M GS | 2 0 13 |
2 0 14 |
||||
|---|---|---|---|---|---|---|
| Ne t book de bt* |
5 098 | 4 911 | ||||
| Re c e iva ble s on disposa ls |
- 413 |
- 338 |
||||
| S e c urity de posits re c e ive d |
- 11 |
- 39 |
||||
| Fina nc e le a se - ba c ke d de bt |
- 3 |
- 2 |
||||
| Ne t d e b t |
4 6 7 1 |
4 5 3 2 |
||||
| Appra ise d va lue of re a l e sta te a sse ts (ID) |
10 204 | 9 871 | ||||
| P re limina ry sa le a gre e me nts |
- 413 |
- 338 |
||||
| Fina nc ia l a sse ts |
4 0 |
3 9 |
||||
| Goodwill | 3 | 2 | ||||
| Re c e iva ble s linke d to a ssoc ia te s |
7 9 |
117 | ||||
| S ha re of e quity a ffilia te s |
132 | 139 | ||||
| Va lu e o f a s s e ts |
10 0 4 4 |
9 8 2 9 |
||||
| LTV ED | 4 8 , 9 % |
4 8 , 5 % |
||||
| LTV ID | 4 6 , 5 % |
4 6 , 1% |
||||
| A djusted for changes infair value of convertible bond (-€73.6 million) |
7. Financial indicators of the main activities
| Foncière des Murs | Beni Stabili | |||||
|---|---|---|---|---|---|---|
| 2013 | 2014 | Var. (%) | 2013 | 2014 | Var. (%) | |
| EPRA Recurrent net income (€ million) | 123,9 | 120,0 | -3,1% | 74 | 87,2 | 17,8% |
| EPRA Recurrent net income (€/share) | 1,93 | 1,84 | -4,7% | 0,04 | 0,04 | -4,0% |
| EPRA NAV (€/share) | 26,2 | 25,9 | -1,1% | 1,06 | 0,87 | -17,8% |
| EPRA triple net NAV (€ million) | 23,3 | 22,7 | -2,6% | 0,96 | 0,80 | -17,0% |
| % of capital held by FDR | 28,3% | 28,5% | 50,9% | 48,8% | ||
| LTV ID | 40,8% | 34,7% | 49,9% | 50,8% | ||
| ICR | 3,21 | 3,21 | 1,55 | 1,8 |
8. FINANCIAL INDICATORS OF THE MAIN ACTIVITIES
Cost of development projects
This indicator is calculated including interest costs. It includes the costs of the property and costs of construction.
- Debt interest rate
- o Average cost:
Financial Cost of Bank Debt for the period
- Financial Cost of Hedges for the period
Average used bank debt outstanding in the year
- o Spot rate: Definition equivalent to average interest rate over a period of time restricted to the last day of the period.
- Definition of the acronyms and abbreviations used:
- o MR: Major Regional Cities, i.e. Bordeaux, Grenoble, Lille, Lyon, Metz, Aix-Marseille, Montpellier, Nantes, Nice, Rennes, Strasbourg and Toulouse
- o ED: Excluding Duties
- o ID: Including Duties
- o IDF: Paris region (Île-de-France)
- o ILAT: French office rental index
- o CCI: Construction Cost Index
- o CPI: Consumer Price Index
- o RRI: Rental Reference Index
- o PACA: Provence-Alpes-Côte-d'Azur
- o LFL: Like-for-Like
- o GS: Group share
-
o CBD: Central Business District
-
o Rtn: Yield
- o RNW: North Rhine-Westphalia
- o Chg: Change
- o MRV: Market Rental Value
- Firm residual term of leases
Average outstanding period remaining of a lease calculated from the date a tenant first takes up an exit option.
Green Assets
Green" buildings, according to IPD, are those where the building and/or its operating status are certified as HQE, BREEAM, LEED, etc. and/or which have a recognised level of energy performance such as the BBC-effinergieR, HPE, THPE or RT Global certifications.
Like-for-like change in value
This indicator is used to compare asset values from one financial year to another without accounting for changes in scope, such as acquisitions, disposals, development projects, etc.
Loan To Value (LTV)
The LTV calculation is detailed in Part 7 "Financial Resources".
Net asset value per share (NAV/share), and Triple Net NAV per share
NAV per share (Triple Net NAV per share) is calculated pursuant to the EPRA recommendations, based on the shares outstanding as at year-end (excluding treasury shares) and adjusted for the effect of dilution.
Occupancy rate
The occupancy rate corresponds to the spot financial occupancy rate at the end of the period and is calculated using the following formula:
1 - Loss of rental income through vacancies (calculated at MRV) rental income of occupied assets + loss of rental income
This indicator is calculated solely for properties on which asset management work has been done and therefore does not include assets available under pre-leasing agreements. Occupancy rate are are calculated using annualized data.
Operating assets
Properties leased or available for rent and actively marketed.
Portfolio
The portfolio presented includes investment properties, properties under development, as well as operating properties and properties in inventory for each of the entities, stated at their fair value. For offices in France, the portfolio includes asset valuations of Coeur d'Orly, DS Campus, Euromed and New Velizy, which are consolidated under the equity method.
- Projects
- o Committed project: these are projects for which promotion or built contracts, work has begun and has not yet been completed at the closing date. They might pertain to VEFA (pre-construction) projects or to the repositioning of existing assets.
- o Controlled project: These are projects that might be undertaken. In other words, projects for which the decision to launch operations has not been finalized.
- Recurring Net Income EPRA per share (RNI/share)
Recurring Net Income per share is calculated pursuant to the EPRA recommendations, based on the average number of shares outstanding (excluding treasury shares) over the period under consideration and adjusted for the effect of dilution
Rental Income
.
- o Recorded rent corresponds to gross rental income accounted for over the year by taking into account deferment of any relief granted to tenants, in accordance with IFRS standards.
- o The like-for-like rental income posted allows comparisons to be made between rental income from one year to the next, before taking changes to the portfolio (e.g. acquisitions, disposals, building works and development deliveries) into account. This indicator is based on assets in operation, i.e. properties leased or available for rent and actively marketed.
- o Annualised rental income corresponds to the gross amount of guaranteed rent for the full year based on existing assets at the period end, excluding any relief.
- Surface
SHON: Gross surface
SUB: Gross used surface
Unpaid rent (%)
Unpaid rent corresponds to the net difference between charges, reversals and unrecoverable loss of income divided by rent invoiced. These appear directly in the income statement under net cost of unrecoverable income (except in Italy for which not relating to unpaid rents were retired)
- Yields/return
- o The portfolio returns are calculated according to the following formula:
Gross annualised rent (not corrected for vacancy)
Value excl. duties for the relevant scope (operating or development)
o The returns on asset disposals or acquisitions are calculated according to the following formula:
Gross annualised rent (not corrected for vacancy)
Acquisition or disposal value excl. duties