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Lar España Real Estate SOCIMI, S.A. (LRE)
Conference call invitation: Megapark Bilbao acquisition
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19 October, 2015 – 17:00 CEST
Direct DDI (s) to Participant Connection:
Spain: +34 917900875
UK: +44(0) 2030092454
USA: +1 8554027761
Participants outside Spain, UK or USA, please call to the Spanish number
Lar España Real Estate SOCIMI, S.A. (LRE)
www.larespana.com
Megapark Bilbao
October 19, 2015
Lar España Real Estate SOCIMI, S.A. (LRE) Lar España Real Estate SOCIMI, S.A. (LRE) - Date Lar España Real Estate SOCIMI, S.A. (LRE)
Disclaimer
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Megapark Bilbao
Lar España Real Estate SOCIMI, S.A. (LRE) Lar España Real Estate SOCIMI, S.A. (LRE) - Date Lar España Real Estate SOCIMI, S.A. (LRE) 4
Unique asset by location, size and tenant line up, located in one of the wealthiest regions in Europe
The largest retail area in the Basque country, with one of the strongest catchment areas in Europe
Game-changing, Off Market Deal, representing over 20% of Lar España’s Current Net Rental Income
The acquisition of Megapark Bilbao for €170m makes Lar España’s
portfolio one of the most attractive real estate platforms in Spain
Megapark Bilbao
Megapark Bilbao is a Retail complex comprised of a Retail Park, Factory Outlet Center and Leisure Area, with a total area of 128,000
sqm. On October 16 Lar España completed the deal signed on July 15, acquiring 64,000 sqm of Megapark Bilbao consisting of 14 retail
warehouse units in the Retail Park and the whole Factory Outlet Centre.
Deal Description
Lar España Real Estate SOCIMI, S.A. (LRE) Lar España Real Estate SOCIMI, S.A. (LRE) - Date Lar España Real Estate SOCIMI, S.A. (LRE)
Megapark Bilbao is a unique asset by market segment, size,
location and its excellent tenant line-up
Prime retail complexes are an evermore sought-after channel for top retailers
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17%
40%
21%
11% 11%
<9,999sqm 10,000-19,999sqm 20,000-29,999sqm 30,000-40,000sqm +50,000sqm
Distribution of Retail Parks in Spain by size
Prime retail complex in a unique location
Megapark has a unique tenant line up Megapark is unique due to its size: 64.000 sqm owned by Lar
• The largest retail area in the Basque Country: more than 128,000 sqm
and one of Europe’s strongest catchment areas.
• Prime Retail Parks benefit from 100% occupancy: €15-€16 rent/sqm/
month.
• Rental performance over the property cycle is more stable than other
asset classes.
• While only 11% of GLA in Spain is located in retail parks, it accounts
for c.30%1 of new supply coming on to the market over the next few
years.
1Savills: January 2015
• The Basque Country has the 2nd highest GDP per capita in Spain.
• Retail density well below Spanish average (40%).
• The Factory Outlet Centre is the only fashion outlet in the north of
Spain, the closest is located 400 km away in Bordeaux (France).
• It comprises a Retail Park, a Factory Outlet Center and a leisure area,
anchored by top retailers.
Megapark Bilbao
Lar España Real Estate SOCIMI, S.A. (LRE) Lar España Real Estate SOCIMI, S.A. (LRE) - Date Lar España Real Estate SOCIMI, S.A. (LRE)
Acquisition of 14 retail warehouse units with top end retailers -
Anchored by Ikea and Leroy Merlin
Excellent International tenant line up and balanced retail mix
• The retail park features all of the main fashion, home and
entertainment brands. It is also anchored by IKEA, -closest
IKEA store 300 km away in Oviedo- and Leroy Merlin, both of
which own their stores.
• The 14 retail warehouses comprise 44,512 sqm (GLA).
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Retail Park
Fashion/Clothes 29%
Home Equipment
32%
Services 5%
Leisure & Sport 34%
Retail Park Activity by GLA
• The rents paid by our tenants (€16.9 per sqm/month) are
above the national average, but appropriate for its
uniqueness: quality retail complex with no competitors.
100% occupied and prime rents above national average
Factory Outlet Center 21%
Retail Park 79%
Passing Rent Distribution
Megapark Bilbao
Lar España Real Estate SOCIMI, S.A. (LRE) Lar España Real Estate SOCIMI, S.A. (LRE) - Date Lar España Real Estate SOCIMI, S.A. (LRE)
Megapark Retail Complex – Retail Park Area - Bilbao
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Megapark Bilbao
Lar España Real Estate SOCIMI, S.A. (LRE) Lar España Real Estate SOCIMI, S.A. (LRE) - Date Lar España Real Estate SOCIMI, S.A. (LRE)
The Factory Outlet Centre acquired is the only fashion outlet in the
north of Spain
Unique Factory Outlet Center destination and balanced retail mix
• The Factory Outlet Centre is the only fashion outlet in the north of
Spain. The closest is located 400 km away in Bordeaux (France). It is
anchored by top-tier tenants: Mercadona, Nike, Desigual and Mango
• Lar España acquired 19,210 sqm (GLA).
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Factory Outlet Center
Fashion/Clothes 36%
Home Equipment
5%
Services 1%
Food/Supermarket 28%
Cafe/Restaurant 1%
Leisure and Sport 4%
Vacant 25%
Factory Outlet Center Activity by GLA
• Current occupancy stands at 75% and the €12 per sqm/month rent
provides room for the asset to be improved: Good sales level and
healthy effort ratio.
• First Mercadona to open in the province of Vizcaya will create novelty
effect and will help to drive the new letting strategy.
Opportunity to create value by improving occupancy and asset performance
Factory Outlet Center 21%
Retail Park 79%
Passing Rent Distribution
Megapark Bilbao
Lar España Real Estate SOCIMI, S.A. (LRE) Lar España Real Estate SOCIMI, S.A. (LRE) - Date Lar España Real Estate SOCIMI, S.A. (LRE)
Megapark Retail Complex - Factory Outlet Center Area -
Bilbao
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Megapark Bilbao
Lar España Real Estate SOCIMI, S.A. (LRE) Lar España Real Estate SOCIMI, S.A. (LRE) - Date Lar España Real Estate SOCIMI, S.A. (LRE)
Game-Changing Off Market Deal, representing over 20% of Lar
España’s Current Net Rental Income
• Purchased @ 6.25% of Net Yield on Cost,
• Underpinning the high recurrent cash-flow generation of the real estate
portfolio.
• Game-changing deal as it represents 20% of all of Lar España’s
investments to date and generates more than €10m in Net Operating
Rents per year.
Prime Regional Retail Park acquired @ above market prime yields
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Retail Ex-Megapark
58% Megapark
21%
Offices 12%
Logistics 9%
Passing Rent Distribution
Megapark Bilbao
Lar España Real Estate SOCIMI, S.A. (LRE) Lar España Real Estate SOCIMI, S.A. (LRE) - Date Lar España Real Estate SOCIMI, S.A. (LRE)
Retail 69% Offices
17%
Logistics 7%
Residential 7%
Asset Distribution by Investment
Lar España consolidates a diversified and stable rent generating portfolio
Madrid 22%
Basque Country
20%
Castilla León 12%
Catalonia 12%
Castilla la Mancha
11%
Galicia 8%
Valencia 9%
Other 6%
Balanced Geographical Distribution
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75%
25%
Mostly Off-Market Acquisitions
Off-Market Market
All figures stated as at the acquisition date
1 7.2% is the Gross Initial Yield of rent generating assets. Thus the €60m investment in a residential development is not included in its calculation. 2 6.6% is the NIY on cost of rent generating assets. Thus the €60m investment in a residential development is not included in its calculation. 3 Not included in the Marcelo Spínola calculation –currently under refurbishment.
Portfolio overview as at October 16
Asset Class Units Price Gross Lettable Area W.A.U.L.T as
at June 2015 Avg. Rent/sqm
Avg. Initial
Occupancy
Weighted Avg.
EPRA Net
Initial Yield
Annual Net Rent
Generation
Retail4 12 €588.7m 320,049 sqm 2.6 €13.82 92.5% 6.57% c.€38m
Offices 5 €140.5m 50,342 sqm 2.0 €13.7 95.6% 5.6% c.€8m
Logistics 5 €63.4m 161,840 sqm 2.7 €3.4 100% 9.6% c.€6m
Residential 1 €60m 23,932 sqm n/a n/a n/a n/a n/a
Total 23 €852.6m 556,163 sqm 2.52(3) €13.0 94.9% 6.6%(2) c.€52m(4)
4 Future rental contribution of Sagunto Retail development has not been included
Megapark Bilbao
Lar España Real Estate SOCIMI, S.A. (LRE) Lar España Real Estate SOCIMI, S.A. (LRE) - Date Lar España Real Estate SOCIMI, S.A. (LRE)
Breakdown of properties by Location, €m
Porfolio Overview Location by property class
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0 50 100 150 200
Other
Galicia
Comunidad Valenciana
León
Castillla la Mancha
Catalonia
Basque Country
Madrid SC
RetailWarehouseRetail Complex
Offices
Logistics
Shopping Centre Office
Logistics
Retail Warehouses
8 Nuevo Alisal (Santander)
9 Villaverde (Madrid)
10 Galaria (Pamplona)
1 L’Anec Blau (Barcelona)
2 Portal de la Marina (Alicante)
3 Albacenter (Albacete)
4 Txingudi (Guipúzcoa)
5 Las Huertas (Palencia)
6 As Termas (Lugo)
7 El Rosal (León)
18 Alovera I (Guadalajara)
19 Alovera II (Guadalajara)
20 Alovera III(Guadalajara)
21 Alovera IV (Guadalajara)
22 Almussafes (Valencia)
13 Egeo (Madrid)
14 Arturo Soria (Madrid)
15 Cardenal Marcelo Spinola
(Madrid)
16 Eloy Gonzalo (Madrid)
17 Joan Miró (Barcelona)
Residential
23 Juan Bravo / Claudio Coello
1
4
9
5
14
15 16
18
8
13
2
3
23
6
21
Lar España’s investments are mainly located in Madrid, Bilbao, Barcelona and wealthy areas of other select cities
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20 19
22
Note: Size as per investment amount
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12 11 Megapark (Bilbao)
12 Cruce de Caminos (Sagunto)
Retail Complex
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Megapark Bilbao
Lar España Real Estate SOCIMI, S.A. (LRE)
• Excellent location in Barakaldo, considered part of the
metropolitan area of Bilbao, in the north of Spain.
• Catchment area: is the most consolidated retail area in the
Basque Country with 1 million people living within 15 minutes
drive and more than 3 million within 90 minutes drive.
• Solid and top-tier tenants: Media Markt, Decathlon,
Oportunidades El Corte Inglés, Mercadona, Nike…
• Barakaldo, with more than 100,000 inhabitants, is one of the
largest cities in the Basque Country. It benefits from very
good road transport links, thanks to its location next to the A-8
Bilbao-Santander motorway.
Asset Characteristics
Asset Name: Megapark
Asset Type: Retail complex
Opening Date: 2004
Location: Bilbao
GLA:
63,722 sqm
RP1: 44,512 sqm
FOC2: 19,210 sqm
Acquisition price: EUR 170 m
Price per sqm: €2,340 per sqm
No. Tenants: 14RP + 61FOC units
Appendix
Retail complex
• Megapark is the largest retail scheme in the Basque
Country. It has one of the strongest catchment areas in
Europe with 18 million visitors per year. It has good growth
potential and limited competition.
• Our tenants benefit from being in a wealthy European
region that outperforms the national economy. The Basque
Country has the 2nd highest GDP per capita in Spain
(€29,683).
• The Retail complex benefits from an extremely strong
tenant line up. The rents paid by our tenants are above
the national average, but appropriate for its uniqueness
(quality Retail complex with no competitors)
Megapark, Bilbao
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Building Capex
Capex committed: €5.1
KPI´s (Initial)
Occupancy (%):
92.4%
RP1: 100%
FOC2: 75% incl.
Mercadona
Net yield on cost (%): 6.25%
Monthly Rent (€/sqm)
€15.6 sqm/mth
RP1: €16.9 sqm/mth
FOC2: €12 sqm/mth
Location & Profile Investment Rationale
1RP: Retail Park 2FOC: Factory Outlet Centre
Megapark Bilbao
Lar España Real Estate SOCIMI, S.A. (LRE)
Lar España invites you take a tour of the asset: Megapark Bilbao
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Save the date: 26 November, 2015: 12:00 - Asset Tour 14:00 - Lunch presentation by Lar España management
• Please confirm your attendance by email to [email protected] specifying the
number of people from your organisation that will attend and any details you consider
necessary. You will be notified of further details in advance.
• Should you have any queries please contact Sergio Criado at [email protected]
Lar España Real Estate SOCIMI, S.A. (LRE) 15