Halfjaarcijfers Wereldhave: CEO Matthijs Storm bij De Aandeelhouder

Thank you, Nico. Yes, nice to be here again.

We are doing a bit better. We are doing somewhat better than other countries in Europe when I look at the results of the peers, but it also does a bit better than the market in the Netherlands. I haven't compared the market data yet, but the food volume, which is published by PFM, the market is roughly flat in the Netherlands and we are at plus 5 percent. So there is a nice gap in between.

Well, look, if you look at the average figure, you don't really see it. What we do see is that if you zoom in line by line for the retailers, then you see big differences, and we showed that this morning in the webcast too: a polarizing market. I have been saying that for a number of quarters actually. So you see the stronger players becoming stronger and the weaker players becoming weaker, read also the bankruptcies we have had in Belgium and in the Netherlands in H2 last year. I think on balance that is actually fine for us. Why? On the one hand, we can attract good new tenants, like expansions with New Yorker, with Normal. We have signed two new gyms with Yellow Gym et cetera. On the other hand, we also see the total rental income going up as a result. In Belgium we also said that all those bankruptcies, once they are all re-let and we are almost there, we ultimately have more rent than we had before. So you come out ahead both qualitatively and quantitatively. Only for the time being, that does have some impact on the result, which is why you see that H1 direct result per share is somewhat lower than where we expect H2 to be. So it will be made up because those empty spaces are all re-let. It is also caught up because we have somewhat lower marginal cost of debt, which again has to do with that Fitch rating, because that only came in June, so that is very recent. We have also just closed new financing in America under 5 percent, which was budgeted higher at the start of the year. So there are also advantages and some other rental income. That is the reason why we are quite sure that we will have a somewhat higher direct result in H2.

What struck me, my CFO said in the webcast that the interest paid there, the US private placement, is under 5 percent. I find that quite low when you look at how that is swapped to euros. But that also means, in credit terms, that the implied spread we pay has dropped below 200 basis points. And that while in the past we were at 275, we have been above 300. That is a credit spread that fits that Triple B Stable profile. But yes, that is the reason.

Yes, that is already taken into account. So what we also said in the call is that it is included. What we do not take into account are possible decreases in the ECB rate or a fall in long-term interest rates. That will be compensated by growing rental income. On the one hand, that has to do with the filled bankruptcies in Belgium. It also has to do with rental growth driven by indexation, and that is again mainly Belgium. Yes, pretty much every time a lease expires, there is a positive uplift.

Yes, well, we have 22 percent of our book floating. So if it is lowered by a quarter of a percentage point, then if you quickly do the math, I think you come to about 500,000 euros, maybe even a bit more. So that is again a cent per share on an annual basis. If that would happen in September or October, then it is only a small part for 2024, but for 2025 it would be a plus.

Well, the main reason to do that is the fiscal climate. As of January 1, 2025, we lose our tax-efficient regime, the FBI regime is going away. There are rumors and discussions that an FBI regime might return for listed companies, but that is all speculation; we cannot base our strategy on that. Fortunately, we still have a lot of tax loss carry-forwards from the past that we can use to reduce our tax burden, but that is what it is. And I would rather use that over a longer period on a smaller portfolio than, say, three or six years on the total portfolio. So that is the main reason. Furthermore, we also think it is good to show the market with a number of those sales that such a full-service center that is finished and completely ready has not only become more valuable on paper but that there is also an investor willing to pay that value or maybe even more.

Yes, we have said that we are actually working on three assets, of which two are already a bit further along. Of those two, one is a full-service center and one is one that has always been in the bucket for sale in terms of return and also potential to develop. We simply cannot make a full-service center out of it. And we are also working, a bit more preliminary, on joint venture discussions for a third asset, which is also a full-service center that is ready. That does not change much for us; we will continue to manage it, just that 50 percent of the shares will be brought in by an investor, like a pension fund or something. For all assets in the Netherlands, we are only talking to core investors, insurers, pension funds, also from abroad. And I think that is also the reason why you can achieve book value or higher. If you want to sell in France now, you can always sell, but there are only opportunistic investors, think Blackstone, Starwood, Fortress. They want to buy, but those are parties that only buy for trading. We are not selling to them now because I already said we have enough liquidity.

Yes, well, what we are going to do is the following. Look, first of all, the debt ratio is now at 43 as you said. I think it will drop to year-end anyway because we have already paid dividend and we still have 20 million in capex planned. So I think by year-end you will be at 41-42. Suppose you do two sales, then you are actually around 35, while we have said 35-40. So we will certainly use a portion for capital allocation. And if you look at the current share price, a share buyback is a very logical option. We have said that before and we have asked and received permission from 99 percent of shareholders at the AGM, so they are apparently enthusiastic about it. So that could be a very logical option.

Well, it is something we are seriously considering. And then ultimately, we naturally want to grow again in the coming years. In the Netherlands that is very difficult. Belgium seems like a very logical market to grow, because we are strong there and we have been there for a very long time and we already have a very nice portfolio and teams. And eventually the day will come when we grow beyond that. That will stir up some dust with the annual figures, but not in the short term.

Well, I think basically it is a logical question. It doesn't necessarily have to be a reverse takeover because there are no tax advantages to having the primary listing in Belgium. That is sometimes thought, but not in our case, and I believe not in the case of Vastned either. But merging the two entities is not a crazy thought at all. We have tried everything. It is true that of the possible cost savings that you could realize, we have already realized part of them. We have, the entire management team in Belgium left last year and we now manage that ourselves, which has led to 1.3 million in annual cost savings. So that is already in the pocket. If you add it all up, indeed. We thought it was a very logical step and it is working, as you can see from the Belgian results. What else could we save? Things like listing costs. You have to make an annual report, then you are talking about maybe a small million per year. So that could still be in the bucket. It is of course the case that if we ever did that, we would also become somewhat larger in market capitalization. We find that scale important, so I do not rule out that it will happen sometime, but it is not something we will focus on in the short term.

Yes, yes. What you see in Belgium, actually also in the Netherlands, is that we have been renting above the market rent, the estimated rental value, for years. That is the rent that the appraisers take. And what you saw in the past two years with those high indexations is that appraisers only increased the ERV moderately because they said, 'Yes, when inflation is over, you will have to give a lot back.' Well, you see in Belgium and also in the Netherlands that that is not the case. So now the appraisers were forced to increase the ERV. In the Netherlands you saw that too, but to a somewhat smaller extent.

Well, they don't have to do anything. Ultimately it is an estimate of what the appraiser thinks the market rent is for such a property. But if you have a lot of evidence that you actually get higher rent, it would be strange if you sign a new 10-year lease for 200,000 and the appraiser keeps saying the market rent is 150,000. So we cannot force them. But it is important for your LTV. And we are not the fund that plays that game with appraisers to get the valuation as high as possible. We have always done it the right way. But you now see that we get credit for the strategy and also for the higher rent.

Yes, they are just dispensers at the entrance. They are specially made for that. We are not the first to do that. They smell nice so people come in. It's not like walking into Ici Paris or Douglas, of course. You want that when you walk into those stores, but not when you walk into our shopping center or full-service center. But you do smell a nice fresh air. What you sometimes have is that the supermarket is at the entrance and certain smells come from there, or there might be a snack bar. So they are small investments, and we test them and get good reactions. So we are rolling them out everywhere, because reactions are good and it's a small investment, so why not?

Yes, you're welcome. Thank you for watching.