brussels, 22 november 2005 the belgian sicafis: a success story and challenges pol r. tansens
TRANSCRIPT
Brussels, 22 November 2005
The Belgian SICAFIs: A Success Story and Challenges
Pol R. Tansens
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The Belgian SICAFIs: A Success Story and Challenges
Introduction Today’s Key Facts and Figures
Main Characteristics of a Belgian SICAFI No Corporate Tax if a Number of Conditions are Met Major Topics
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The Belgian SICAFIs: A Success Story and Challenges
SICAFIs and the Stock Exchange Excellent Returns Why are SICAFIs so Popular ? Increasing Daily Volumes
SICAFIs and Portfolio Theory Limited Correlation with Other Shares
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The Belgian SICAFIs: A Success Story and Challenges
Upcoming Challenges Growth Strategy Necessary? International REIT in the Pipeline ? What about Raising Interest Rates ?
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Introduction1
Today’s Key Facts and Figures
Vastgoedbevak (12 juli 2005) Kantoren Bedrijfsruimten
Winkels Ander Waarde (mrd EUR)
Vreemd vermoge
n
Regio
Befimmo 97% 2% - 1% 1,13 44,4% BrusselCofinimmo 98% - 2% - 2,10 47,1% BrusselHome Invest Belgium 6% - 11% 83% 0,09 38,9% BelgiëIntervest Offices 75% 25% - 0,59 47,5% Brussel/VlaanderenIntervest Retail - - 100% - 0,28 44,9% BelgiëLeasinvest Real Estate 80% 16% 4% - 0,29 33,7% Brussel/VlaanderenRetail Estates - - 100% - 0,18 33,6% België/BuitenlandWarehouses De Pauw 17% 73% 5% 6% 0,36 35,5% Vlaanderen/BuitenlandWarehouses Estates 3% 44% 52% 1% 0,08 21,5% WalloniëWereldhave Belgium 44% - 56% - 0,31 20,0% BelgiëGewogen gemiddelde/Totaal 75% 10% 14% 2% 5,42 36,7%
Bron: MeesPierson Real Estate
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Introduction1
Today’s Key Facts and Figures
Vastgoedbevak (12 juli 2005) Bezetting HuurrendementBefimmo 92,3% 7,77%
Cofinimmo 93,3% 7,63%
Home Invest Belgium 93,8% 7,29%
Intervest Offices 80,7% 8,86%
Intervest Retail 93,0% 8,09%
Leasinvest Real Estate 91,2% 6,78%
Retail Estates 98,8% 8,36%
Warehouses De Pauw 90,0% 8,48%
Warehouses Estates 96,8% 9,97%
Wereldhave Belgium 81,0% 8,70%
Gemiddelde 91,1% 8,19%
Bron: MeesPierson Real Estate
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Introduction1
Today’s Key Facts and Figures
Vastgoedbevak (23 okt 2000) Bezetting HuurrendementBefimmo 98,3% 7,70%
Cibix 99,7% 7,45%
Cofinimmo 98,5% 7,87%
Home Invest Belgium 99,2% 8,10%
Leasinvest Real Estate 100,0% 7,63%
PeriFund 97,6% 8,11%
Retail Estates 99,4% 8,50%
Siref 98,9% 8,68%
Warehouses De Pauw 99,0% 9,29%
Warehouses Estates 99,5% 9,15%
Wereldhave Belgium 80,0% 7,70%
Gemiddelde 97,3% 8,20%
Bron: MeesPierson Real Estate
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Introduction1
Today’s Key Facts and Figures
VastgoedbevaksBefimmo CVOACofinimmo NVHome Invest Belgium NVIntervest Offices NVIntervest Retail NVLeasinvest Real Estate CVOARetail Estates NVServiceflats Invest NVWarehouses De Pauw CVOAWarehouses Estates CVOAWereldhave Belgium CVOABron: MeesPierson Real Estate
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Main Characteristics of a Belgian SICAFI
No Corporate Tax if a Number of Conditions are Met
Some Major Topics:
Activities Portfolio Diversification Profit Distribution Valuation of Assets
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Main Characteristics of a Belgian SICAFI
Valuation of Assets
RICS (Royal Institution of Chartered Surveyors) International Valuation Standards Committee (IVSC) European Group of Valuer’s Associations (TEGoVA)
RICS believes that IVSC is in best position to define a general valuation framework world-wide
IVSC Standards incorporated into RICS’s “Red Book” Assets valued at “market value”
Key issue in Belgium Market value including or excluding transaction costs? Vrij op naam/Acte en main vs. Kosten Koper ...
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SICAFIs and the Stock Exchange3
Excellent Returns
Annual Returns 5-year period: 7 November 2000- 7 November 2005 (%)Vastgoedbevak Dividend reinvested at 2.28% Dividends reinvested in security Share price appreciationWarehouses De Pauw 20.62 23.21 13.69Retail Estates 18.32 20.62 13.01Home Invest Belgium 17.31 19.01 13.20Wereldhave Belgium 15.41 17.56 9.85Cofinimmo 13.58 15.21 8.15Intervest Offices 13.29 11.60 4.32Befimmo 12.38 13.98 6.98Leasinvest Real Estate 11.52 13.10 5.57Intervest Retail 11.21 12.50 6.30BEL20 4.92 5.77 1.80Source: Bloomberg
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SICAFIs and the Stock Exchange3
Why are SICAFIs so Popular ?
Still a spread of some 200 basis points between treasury bonds and dividend yields
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SICAFIs and the Stock Exchange3
Why are SICAFIs so Popular ?
Comparative matrix01 nov 2005 Share
Price(EUR)
LatestNAV
(EUR)
Premiumto NAV
GrossDiv.
Yield
NetDiv.
Yield
Pay-outRatio
MarketCap
(EUR bn)
FreeFloat
PortfolioValue
(EUR bn)
Occup.Rate
DebtRatio
Wereldhave Belgium 68,00 58,56 16,12% 5,44% 4,63% 98,9% 0,36 31,8% 0,31 81,0% 20,0%Intervest Offices 25,89 22,28 16,20% 7,14% 6,07% 100,0% 0,36 47,2% 0,59 81,5% 48,2%Leasinvest Real Estate 65,30 55,58 17,49% 5,71% 4,86% 93,0% 0,18 59,2% 0,29 91,2% 33,7%Intervest Retail 40,01 33,46 19,58% 6,35% 5,40% 100,0% 0,20 22,5% 0,29 92,9% 41,7%Home Invest Belgium 56,50 46,02 22,77% 3,88% 3,88% 98,3% 0,08 52,2% 0,09 93,8% 38,9%Cofinimmo 130,80 105,66 23,79% 5,62% 4,78% 88,0% 1,28 82,9% 2,10 93,3% 47,1%Retail Estates 43,00 33,82 27,13% 5,35% 4,55% 99,2% 0,15 75,1% 0,18 98,8% 33,6%Befimmo 83,70 65,59 27,61% 5,73% 4,87% 95,8% 0,82 83,8% 1,13 92,3% 42,5%Warehouses De Pauw 39,42 30,73 28,28% 6,27% 5,33% 93,9% 0,31 70,0% 0,37 90,0% 35,4%Warehouses Estates 37,00 28,58 29,46% 5,97% 5,08% 97,7% 0,09 39,7% 0,08 96,8% 21,5%Average 22,84% 5,75% 4,94% 96,5% 56,4% 91,2% 36,3%OLO 10 Years 3,46% 2,94%Total 3,85 5,44
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SICAFIs and the Stock Exchange3
Why are SICAFIs so Popular ?
Com parative m atrix
23-okt-00 SharePrice(EUR)
LatestNAV
(EUR)
Prem iumto NAV
RentalYie ld
(fully le t)
GrossDiv.
Yie ld
NetDiv.
Yie ld
ExpectedNet Div.
(EUR)
Pay-outRatio
MarketCap
(EUR bn)
FreeFloat
PortfolioValue
(EUR bn)
Occup.Rate
DebtRatio
Bef immo 57,10 59,90 -4,67% 7,70% 7,45% 6,33% 3,41 82,9% 0,43 52,6% 0,55 98,3% 24,1%
Cibix 38,75 43,30 -10,51% 7,45% 7,39% 6,28% 2,30 82,3% 0,14 51,2% 0,27 99,7% 31,7%
Cof inimmo 84,25 101,66 -17,13% 7,87% 7,39% 6,28% 5,12 94,8% 0,60 55,9% 0,96 98,5% 25,9%
Home Invest Belgium 31,00 35,76 -13,31% 8,10% 6,48% 5,51% 2,00 91,2% 0,03 58,0% 0,04 99,2% 21,6%
Leasinvest Real Estate 49,30 56,81 -13,22% 7,63% 8,07% 6,86% 3,13 89,3% 0,12 45,8% 0,18 100,0% 27,4%
PeriFund 21,25 27,78 -23,51% 8,11% 7,74% 6,58% 1,35 88,2% 0,04 86,1% 0,07 97,6% 22,6%
Retail Estates 24,00 29,95 -19,87% 8,50% 9,09% 7,73% 1,80 98,0% 0,05 78,6% 0,08 99,4% 22,4%
Siref 38,60 40,78 -5,35% 8,68% 9,43% 8,02% 2,99 100,4% 0,08 70,0% 0,10 98,9% 21,8%
Warehouses De Pauw 20,90 21,88 -4,48% 9,29% 8,01% 6,81% 1,36 90,0% 0,14 46,9% 0,20 99,0% 27,4%
Warehouses Estates 26,10 25,83 1,05% 9,15% 7,56% 6,43% 1,71 89,7% 0,05 45,0% 0,06 99,5% 19,3%
Wereldhave Belgium 42,50 58,92 -27,87% 7,70% 9,20% 7,82% 3,20 100,0% 0,23 32,0% 0,26 80,0% 25,6%
Average -12,62% 8,20% 7,98% 6,79% 91,53% 56,6% 97,3% 24,5%
OLO 10 years 5,58% 4,74%
Total 2,25 2,98
Bron: Fortis Bank Equity Research
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SICAFIs and the Stock Exchange3
Increasing Daily Volumes
23/okt/00 Gemiddeld dagvolume Koers Dagvolume (EUR)Befimmo 2.300 57,10 131.330Cibix 1.400 38,75 54.250Cofinimmo 2.900 84,25 244.325Home Invest 400 31,00 12.400Intervest Retail 600 29,95 17.970Leasinvest Real Estate 300 49,30 14.790PeriFund 1.100 21,25 23.375Retail Estates 1.500 24,00 36.000Siref 900 38,60 34.740Warehouses De Pauw 700 26,10 18.270Warehouses Estates 2.500 20,90 52.250Wereldhave Belgium 1.300 42,50 55.250Bron: Thomson Financial Datastream
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SICAFIs and the Stock Exchange3
Increasing Daily Volumes
12/jul/05 Gemiddeld dagvolume Koers Dagvolume (EUR)Befimmo 7.757 79,85 619.388Cofinimmo 16.605 129,90 2.156.951Home Invest 564 53,90 30.394Intervest Ofices 8.422 23,45 197.498Intervest Retail 2.217 38,30 84.907Leasinvest Real Estate 4.145 63,40 262.793Retail Estates 1.678 40,60 68.135Warehouses De Pauw 471 39,68 18.669Warehouses Estates 7.114 38,00 270.336Wereldhave Belgium 1.438 66,40 95.463Bron: Thomson Financial Datastream
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SICAFIs and Portfolio Theory4
Limited Correlation with Other Shares
Land REIT Naam Aandelenindex BetaBelgië SICAFI Befimmo BEL20 0,40
SICAFI Cofinimmo BEL20 0,37Frankrijk SIIC Gecina CAC40 0,36
SIIC Klépierre CAC40 0,42SIIC Silic CAC40 0,40SIIC Unibail CAC40 0,44
Nederland BI Cório AEX 0,42BI Eurocommercial Properties AEX 0,41BI Rodamco Europe AEX 0,46BI VastNed Offices AEX 0,41BI VastNed Retail AEX 0,39BI Wereldhave AEX 0,43
Bron: Real Estate Center Universiteit Nyenrode/MeesPierson Real Estate
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Upcoming Challenges5
Growth Strategy Necessary ?
Market cap. of EUR 1 bn ?
Difficult Market Conditions for Investments ?
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Upcoming Challenges5
International REIT in the Pipeline ?
Harmonisation of Tax Rules within Europe ?
Focus vs. Diversification ?
Management Issues
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Upcoming Challenges5
Public Real Estate
If nominal rates return (share prices + dividend) If nominal rates return (share prices + dividend)
This has been the case so far: prices driven by lack of investment alternatives and spread between A+ bond yields and dividend yields
If nominal rates = return = dividend Examples
