9 May 2023, 7:00am, Antwerp, Belgium: VGP NV (‘VGP’ or ‘the Group’), a European provider of high-quality logistics and semi-industrial real estate, today published a trading update for the first four months of 2023:
- Continued strong operating performance
- € 24.3 million signed and renewed lease agreements (versus € 20.7 million for 4M ‘22), bringing total annualized rental income to € 320.7 million[1]
- 23 projects, representing 664.000 m2 under construction and € 44.4 million in additional annual rent once fully built and let (currently 93.4% pre-let), of which 6 projects initiated construction in ’23, representing 114.000 m2 of fully let area
- 9 projects delivered during the first four months representing 264,000 m2 bringing the already income generating portfolio to 4.6 million¹ m2 lettable area (99% let)
- A total of 300,000 m2 of land acquired, bringing the total landbank to 7,987,000 m2 representing a development potential of circa 3.6 million m2
- Progress on joint ventures:
- Successful 10th closing with the first joint venture was completed in January generating € 81 million of cash
- The group is in advanced negotiations to broadening its JV Model with potential and existing partners. Further formalisations are expected in the coming period
- Advancement of cash generating model through our own and jointly held portfolio
- € 44 million of committed lease agreements to become effective in the next 12 months resulting in a total aggregate indexed effective rent of € 310.4 million at the end of this period (compared to the current committed leases of € 320.7 million)
- Repaid € 150 million of bonds upon the maturity in April. This is one of the two bonds coming to maturity in 2023, the second one planned for repayment in September (€ 225 million at 3.90%)
VGP’s Chief Executive Officer, Jan Van Geet, said: “2023 started off on a strong footing based on resilient occupier demand across the portfolio despite economic uncertainties. Furthermore, indications of a favorable change in trend in construction prices is supporting our newly planned developments. Our total committed leases grew to € 320.7 million¹, whereby the rental growth is driven by incremental leases of € 11.8 million¹ as well as indexations of € 9.2 million¹.
Jan Van Geet continued: “Further progress has also been made in the discussions with potential and existing joint venture partners, where several transactions are in due diligence phase and we continue to explore various alternatives. Communication on the outcome of said discussions is anticipated in the upcoming period.”
Jan Van Geet concluded: “We are optimistic in our outlook for the upcoming months as we increasingly see interesting opportunities with a lot of accretive development potential arise in the market. At the same time we remain focused on maintaining our high occupancy and pre-let ratios.”
[1] Including JV’s @ 100%