VGP publishes first quarter 2020 trading update and announces plans for new partnership with Allianz for VGP Park München

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16 April 2020, 7:00am, Antwerp (Berchem), Belgium

VGP NV (‘VGP’ or ‘the Group’), a leading European provider of high-quality logistics and semi-industrial real estate, today published a trading update for the first quarter of 2020:

  • Impact of Covid-19
    • Our primary focus is the health, safety and well-being of our employees and partners
    • The VGP team is operational, mostly working from home, with full access to systems. Where allowed, our construction sites are fully operational
    • Until now the impact on rental payments is very limited: nearly all due payments were received on time. Some selective reprofiling discussions ongoing but it is probably too early to assess the whole impact of the respective measures taken to contain the spread of the virus on our tenants
    • All pre-let development projects have now been resumed with minimal timing impact of temporary suspensions; speculative developments remain frozen where possible
    • Focus on maintaining a strong capital position – VGP is well capitalized with significant cash headroom (including unutilised 3-year RCF of €150 million)
  • Operating model remains intact and business fully operational:
    • Total annualized rental income increased to €159.9 million (+5.0 million year-to-date)
    • 37 projects under construction, representing 865,000 m2 or €54.4 million in additional annual rent once fully built and let (72% pre-let)
    • 4 projects delivered during the 1st quarter, representing 54,000 m2 (100% occupancy)
    • Land bank replenished – 56 million m2 of new land bought
  • Signed letter of intent with Allianz in respect of new JV for development of VGP Park München
    • Agreement in principle to launch new 50:50 JV in H1 2020
    • This will be the first JV to also cover the development of a VGP park – VGP will forward sell VGP Park München to the new JV and recognize the majority of development profit at the moment of entering the JV, with sales proceeds being received at the moment of delivery of the respective buildings
    • Upon entering the JV, VGP is expected to receive the pro-rata share of development expenses until that date; all further future funding needs will be financed jointly