Trading Update 9M 2018
Results 2018 on track; direct result to top of range
- 2.0% rent increase on new core city assets leases concluded in 9M 2018
- Occupancy rate core city assets 96.7% as at 30 September 2018
- Core city assets portfolio in Utrecht expanded by € 11.0 million in total
- Non-strategic properties in the Netherlands and France sold for € 64.3 million in total
- Flagship store UNIQLO at Kalverstraat 11/Rokin 12 in Amsterdam opens for business
- Dutch government retains FBI regime; Vastned advocates conversion into REIT regime
- Share buyback programme started of € 40 million maximum
- Forecast for 2018 direct result at top of range, between € 2.15 and €2.20 per share
- Dividend proposal for 2018 € 2.05 per share in total
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Our portfolio showed good results in the first nine months of 2018, in line with our expectations. The share of core city assets in the portfolio was 81% and the occupancy rate of the total portfolio remained high at 96.3% at the end of September. The retail market is in transition and will remain so for the near future, so that retailers are cautious about opening new shops. In this, the characteristics and locations of retail properties are highly important.
The quality of our portfolio has improved further with the sale of various non-strategic properties in France and the Netherlands. Furthermore, food & beverage assets in centre of Utrecht were added to our core city assets portfolio.
On Budget Day, the Dutch government announced its tax plans. Some time after, due to increasing resistance from the opposition the government decided to cancel the intended abolition of the dividend tax and the associated abolition of the FII regime. This is good news for Vastned because it means that the tax regime in the Netherlands will remain unchanged. Even so, Vastned will continue to advocate conversion into a REIT regime for property funds.
On 19 October 2018, we started a share buyback programme of a maximum of € 40 million. Investment opportunities for core city assets to which Vastned can add value are currently limited and yields are at a historic low. We believe that a share buyback is currently the best alternative to generate returns for our shareholders.
Over the remaining months of this year we will continue step by step to implement our strategy and we anticipate a direct result for 2018 at the top of the range announced earlier, i.e. between € 2.15 and € 2.20 per share.
Vastned is a listed European retail property company (Euronext Amsterdam: VASTN) 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 as at 30 September 2018.