Annual Results 2019
Portfolio virtually fully let; growth of direct result 2020 expected
Key points 2019
- Direct result 2019 € 2.03 per share, in line with forecast
- Occupancy rate strongly up in the course of the year to 98.0% at year-end 2019
- Like-for-like gross rental decrease of 3.0%, due in particular to the temporary vacancy of Rue de Rivoli 118-120 in Paris
- Value of total portfolio virtually unchanged (-0.8%)*
- Clusters in Amsterdam expanded by € 13.7 million
- Non-strategic assets in the Netherlands and Belgium sold for € 12.1 million
- Loan-to-value ratio at year-end 2019 41.6%, within 35%-45% range
- Dividend proposal for FY 2019 € 2.05 per share, unchanged from FY 2018
- Direct result 2020 expected to grow to € 2.05 - € 2.15 per share due to improved occupancy rate
* Excluding acquisitions and divestments
Taco de Groot, Vastned CEO: "The quality of the portfolio improved in the course of the year and the occupancy rate remains high; the portfolio is virtually fully let. Over the past seven years we have created a unique portfolio with a consistent strategy, which in 2019 again proved to be able to attract leading new tenants. Our portfolio now comprises 83% high street retail property in bigger European cities with historic city centres and a strong identity. The market remains challenging and the transition of the retail landscape is ongoing, but with the transformation of its portfolio Vastned has responded in a timely manner to the current trend of retailers reducing the number of their shops and focusing on top locations in the bigger cities.
The direct result for 2019 of € 2,03 per share was lower than for 2018. However, corrected for the non-recurring income in 2018 the 2019 direct result was unchanged from 2018. We are delighted that we have been able to attract JD Sports as a new tenant for our property at Rue de Rivoli 118-120 in Paris at market conditions. We also contracted Skechers as a new tenant for our other property on Rue de Rivoli. In addition, we welcomed retailer Sephora at Calle Serrano 36 in Madrid after the departure of Salvatore Ferragamo. When we relet any of our properties, we are trying to reduce the share of fashion in our portfolio since this is generally a weaker segment in the retail market. The high occupancy rate of our portfolio demonstrates that if you own the right assets in a city, they will continue to generate rent over the longer term. This is also evident from the fact that the value of the total portfolio is virtually stable (-0.8% excluding acquisitions and divestments).
In spite of the lower direct result in 2019 compared to 2018 we still have the intention of distributing a dividend of € 2.05, equal to the 2018 dividend. We are confident that the quality of our portfolio will enable us to realise a strong direct result next year. We will keep focusing on maintaining the high occupancy rate of our portfolio. For 2020 we forecast that the direct result will grow to between € 2.05 and € 2.15 per share. This increase is expected to be due especially to the improved average occupancy rate compared to 2019 as a result of contracting JD Sports for the top location on Rue de Rivoli at market conditions. Although we expect the capex level to remain low like it was in previous years, we will continue to invest in historic cities in order to extend the functional lifespan of our assets, make them more sustainable and contribute to the attractiveness and liveability of city centres."
Vastned is a listed (Euronext Amsterdam) European retail property company focusing on venues for premium shopping. Vastned invests in selected cities in Europe with a clear focus on the best retail property in the most popular shopping streets in the bigger cities. Vastned's tenants are strong and leading international and national retail brands. The property portfolio has a size of approximately € 1.6 billion.