Redevco is a pan-european retail real estate specialist. We deliver sustainable income and above average growth And we have a solid track record to prove it.
CONTENTS
01/ OUR PROPOSITION See what Redevco is about and what we can offer you.
02/ ORIGINS Learn about the solid foundations and rich history of our company.
03/ ASSET MANAGEMENT Find out how our deep understanding of local markets and core asset management skills are the backbone of the organisation.
04/ PORTFOLIO MANAGEMENT Optimising our portfolio deserves an active approach. See how we trade for value.
05/ INVESTMENT MANAGEMENT Our investment management team combines strategic, tactical and operational disciplines to set a sound basis for every investment.
06/ SUMMARY Investing in real estate requires a specialist. That trusted specialist is Redevco.
more than 500 Properties WITH A total portfolio value of €6.5 billion, covering 3.3 million SQ M, in more than 350 cities in 10 countries with over 2,500 leases.
AMSTERDAM
BERLIN
LONDON
BRUSSELS
PARIS VIENNA
BUDAPEST
We’re active right across Europe making town and city centres more interesting places to live, work and shop. You’ll find our properties exactly where you’d expect them to be. Our portfolios are balanced with a focus on sustainable income and potential for further growth. From Edinburgh to Alicante, Brussels to Barcelona and in many towns and cities in between, you won’t see our name over the doors of our properties, but our presence is undoubted.
MADRID
LISBON
Capital cities and Redevco presence Redevco presence
01/ our PROPOSITION
We offer a partnership and access to an exclusive platform that invests in retail real estate, with a long term focus on stable and attractive returns.
Oxford Street, London, UK
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01/ our proposition
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Our people combine intimate local market knowledge with retail real estate expertise to deliver consistent investment performance.
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8 1. H&M, 137 Rua Augusta, Lisbon, Portugal 2. Gap, 376-384 Oxford Street, London, UK 3. Multi-tenant, Vorosmarty No 1, Budapest, Hungary 4. Multi-tenant, Anger 63, Erfurt, Germany 5. Sephora, 70-72 Champs-Élysées, Paris, France 6. C&A, Rue de la Croix D’or 8, Geneva, Switzerland 7. Zara, Oudegracht 151, Utrecht, The Netherlands 8. C&A, Mariahilfer Strasse 96-98, Vienna, Austria 9. Galleria Inno, 111-123 Rue Neuve, Brussels, Belgium 10. C&A, Carrer de Pelai 54, Barcelona, Spain
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Redevco’s steady and sustainable growth has been achieved by hard work, diligent investments and attention to detail.
We manage one of the biggest retail property portfolios in Europe and we’re continuously redeveloping sites to further optimise value. Our combined portfolio currently comprises more than 500 prime properties in dominant shopping areas of Europe’s most resilient markets. Our high-quality tenants trade across all sectors from fashion to furniture, banking to groceries, coffee shops to baby goods. 170 years of retail history provides us with unique insights and a deep-rooted, intimate knowledge of retail enabling us effectively match retailers to the right assets.
Secondly, our retail dedicated approach means we are attuned to the fast paced evolution of market requirements, enabling us to predict and respond to changes to always provide the relevant, sustainable and inspiring real estate. Furthermore, there’s also an overarching maxim that allows us to deliver above average returns for our investors. It is about sharing and exchanging the knowledge of our local teams to match the international nature of retail. It is about combined intelligence to cleverly create synergies that lead to an optimised investment in retail real estate.
Driving sustainable returns Since Redevco’s inception in 1999, we’ve grown the portfolio from €4.1 billion to a current value of €6.5 billion. The share of retail assets in the total portfolio has grown from 82% in 2004 to 92% in 2012. That is the result of carefully managed and strategic portfolio development. There are two core principles that reflect our proposition. Firstly, using our local knowledge, we buy, develop, let and manage properties that are ideally suited to the requirements of our tenants, which are then continuously monitored to ensure they are met on an ongoing basis.
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01/ our proposition
It is our mission to be the real estate partner of choice for retailers.
We nurture our relationships with our clients and turn them into partnerships.
Thanks to our long experience in retail, we speak the language of both retailers and investors. Our history and pedigree speak for themselves. We do everything we can to build on those attributes to help ensure a successful future. We only work with the best. We’re as selective about our team as we are about our properties – there is no compromise. Our business is built on relationships and we concentrate on nurturing them and turning them into partnerships. Throughout our enterprise, we stress the importance of business ethics. Without that, we cannot build trust. Our people make decisions that have the best interests of tenants, developers and partners at heart. In turn, our people are accountable and entrepreneurial because of Redevco’s culture of teamwork and development.
Business in Balance Our commitment to corporate responsibility is equally serious. The fundamental principle behind Redevco’s approach to corporate responsibility is “Business in Balance”. That means combining economic, social and environmental interests in equilibrium. We believe we have a fiduciary as well as social responsibility to understand the implications of environmental and social issues and ensure that our real estate activities add value as a whole. Since 2009 we publish a corporate responsibility report in accordance with the Global Reporting Initiative. All our reports can be found on our website.
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01/ our proposition
Our philosophy revolves around liquidity and stability generating highly attractive risk adjusted returns. A real estate business developed with retail in mind – unprecedented access to the best assets, in the best locations, in the strongest economies.
Due to our retail pedigree, we have unrivalled market intelligence that allows us to develop outperforming strategies, tactics and operational excellence. Ours is a successful platform. We can demonstrate our extensive retail real estate knowledge and understanding. We quickly adapt to ever changing market dynamics, validating our experience of the wider retail environment by observing trends, drivers and influencing factors. We mitigate risk via in-depth research and monitoring, continuously reassessing according changes in the retail sector. As a result, we invest only in assets that offer great potential. Our own Internet Strategy Platform analyses events and changes in European consumer shopping habits and retailer performance. This all combines to help shape our operational strategy. Currently the following discoveries are influencing our strategic considerations:
• We will augment our knowledge of retail with economic and demographic fundamentals.
• In terms of reacting to the macro environment, we will find the best investor-to-retailer fit.
• We recognise that a retailer’s brand value is the key to future success. A note on larger cities… Independently commissioned research shows that decreasing shopping trips caused by the Internet will affect smaller cities much more than larger cities, which have greater pulling power and attraction. As a result, we have become even more selective about our location strategy, driven by increasingly refined measures of attraction. Modern consumers want convenience, interaction and experience. We need to continue to understand how people shop and how they aspire to shop.
• Larger cities have better prospects. • We shall target cities with higher retail sales and room for growth.
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01/ our proposition
We have MORE THAN 200 dedicated colleagues working in offices throughout Europe, Ideally located for access to prime retail investment opportunities.
c SPA P IN /
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9. 3% THE NET
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9.3%
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MA NY
7.8%
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AMSTERDAM LONDON
UNITED KINGDOM
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12.8%
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BRUSSELS
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DÜSSELDORF
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Geographical spread of The combined portfolio, March 2013
PARIS
ZÜRICH
We are optimally represented throughout the continent.
Redevco has national offices in key locations across Europe. These locations have been strategically sought to maximise Redevco’s European presence. Amsterdam With a metropolitan population of 2.2 million people, Amsterdam is the financial and business capital of The Netherlands. It receives 4.6 million visitors annually. Amsterdam is home to the Redevco head office and the office of Redevco Netherlands. Brussels The capital of Belgium, with more than 1.2 million inhabitants, hosts many political and diplomatic institutions and individuals. It naturally offers a North European hub for retail real estate.
MADRID
Düsseldorf Düsseldorf is renowned as a financial centre and for its international fashion and trade fairs. The city, with a population of 1.5 million is headquarters to five Fortune Global 500 and several DAX companies.
London The largest metropolitan area in the United Kingdom, home to 8.3 million people and the most visited city in the world based on international arrivals. Madrid Our office in Madrid manages our activities in Spain and Portugal. Madrid is the third largest city in the European Union after London and Paris, with a population of around 6.3 million. Paris With more than 12 million inhabitants in its entire metropolitan area, Paris is one of the world’s leading business and cultural centres. Retail property is at a premium in the city centre. Zürich Zürich is the largest city in Switzerland. Its metropolitan area is home to more than 3 million people. It is a premium global city and one of the world’s busiest financial centres, playing host to the most prestigious banks and financial institutions.
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01/ our proposition
REDEVCO’S MANAGEMENT STRUCTURE AND TEAM SET UP ARE BASED ON A COMBINATION OF REAL ESTATE INTELLIGENCE AND RETAIL UNDERSTANDING.
CHIEF EXECUTIVE OFFICER (CEO)
CHIEF INVESTMENT OFFICER (CIO) investment MANAGEment
CHIEF OPERATIONS OFFICER (COO)
CHIEF OPERATIONS OFFICER (COO)
FUND DIRECTORs
COUNTRY managING DIRECTORS
COUNTRY managING DIRECTORS
CHIEF FINANCIAL OFFICER (CFO)
REDEVCO CHAIRMAN
CHIEF HUMAN RESOURCES & CORPRATE RESPONSIBLITY OFFICER (CHR & cro)
A pan-European organisation with local, city-based knowledge, and skilled specialists undertaking portfolio and asset management activities at all of our locations.
At Redevco, we pride ourselves in being a pan-European organisation with local, city-based knowledge. To keep our standards high, strategic and countrywide operations are overseen by our Executive Board. The CEO steers Redevco and oversees research & strategy, legal, and PR & corporate communications at head office level.
• The CIO heads up the investment management organisation and directs all of the investment vehicle operations.
• Two COOs are responsible for operational excellence in the countries where we operate. They coordinate functions, concepts and tenant account management.
• The CFO supervises the following head office functions: governance, risk and compliance, tax, internal audit, group control and IT.
• The CHR & CRO is responsible for the human resources and corporate responsibility departments.
• In 2007 Redevco established its corporate responsibility department to put emphasis on and support the Board and country offices with sustainability topics. Redevco started reporting on corporate responsibility in 2009 when they published their first corporate responsibility report. At country level, the country managing director oversees daily operations and Redevco’s teams, who are deeply connected to the local markets. We have specialists with the appropriate skills required to manage portfolio and asset management activities at all of our locations. Dedicated Investment Management Business Unit The different vehicles are run by the CIO, who is supported by a committed management team. This management team consists of the CIO, the two fund directors who are dedicated to their vehicles, and the CFO. The CIO and fund directors act as the management team of the investment vehicle operations.
Each of the directors is responsible for managing and growing their respective portfolio and ensures that the day-to-day management, as well as new acquisitions and disposals, are in accordance with the defined investment strategy. The fund directors are supported by a team of investment management and finance professionals. We focus on business results Redevco has identified three core competencies for achieving business success: investment strategy and investor relations, the sourcing of deals and operational excellence in executing the strategy.
• Investment strategy and investor relations are run by the CEO/CIO and a dedicated investment management team. The CEO/CIO is responsible for elaborating the vehicles’ strategies and their realised performance.
• The execution itself (sourcing, buying, selling and asset management) is carried out in each country by portfolio and asset management professionals.
• Country units regularly give an account of the
Reporting Regional finance teams report regularly to head office and full financial consolidation is performed on a quarterly basis, taking into account all regional financial data. Risk Awareness Framework Our Risk Awareness Framework, which includes Strategic Risk Management (SRM) and Internal Controls Risk Management (ICRM), has been specifically developed for retail property investment. The framework comprises various internal controls that form an essential aspect of our day-to-day operations and activities. While the framework covers all of the expected principal risks it is still flexible and practical so that it does not impede the agility of our business. This is largely possible because of the high grade of talent that Redevco employs. As a result, the framework embodies a governance structure with responsibilities clearly assigned to reliable and professional employees.
vehicles’ day-to-day operations to the head office management team.
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02/ ORIGINS
We know retail real estate. We have been in the business for over 170 years and six generations.
Rue de Rivoli, Paris, France
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02/ ORIGINS
C&A, the brand and its name, comes from the initials of the two brothers that started the company, Clemens and August Brenninkmeijer. With Redevco, the management of the substantial investment in retail property is further professionalised.
In 1841, the two brothers opened a textile warehouse in the Friesian town of Sneek in The Netherlands. From here, they would travel across the region selling their fabric to farmers. In 1861, they opened their first shop, which in addition to selling traditional fabrics, was the first store in history to offer ready-made clothing. This marked the beginning of a remarkable brand that had an enormous impact on the fashion retail industry for the next 170 years. After 1880, their children opened more stores throughout The Netherlands and beyond. They started by branching out to Berlin, Germany and opened further stores in England, Belgium, France and Switzerland. Today, still managed as a family business, C&A has a presence not only across Europe, but also in Brazil, Mexico and China.
Until 1999, C&A managed its own real estate activities. In that year an independent business was established to further professionalise the management of the substantial investment in retail property. That business is Redevco. Since 2001, Redevco and C&A have fallen under the ownership of COFRA Holding AG based in Switzerland. Redevco is in good company because the COFRA Group holds companies all over the world; in Europe, Asia and North and Latin America. COFRA’s main interests include retail and real estate, as well as corporate and private equity investments. In short, when you consider its beginnings and longevity, Redevco is a young and dynamic real estate company, yet with a rich history and solid track record.
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02/ ORIGINS
a dynamic real estate company with a solid track record in asset management, portfolio management and investment management.
Redevco, established as a dedicated real estate company with a portfolio worth €4.1 billion. Assets located in Belgium, Denmark, France, Germany, Luxembourg, Portugal, Spain, Switzerland, the Netherlands and the UK.
Investment management segmentation of portfolio into distinct investment products with own risk/return profiles • Cofra C&A portfolio • existing prime assets portfolio • CORE portfolio
INVESTMENT MANAGEMENT
portfolio management
trade to improve the quality of the portfolio
Acquisition: BE, GIB IMMO real estate portfolio • GIB IMMO • €1.1 Billion
Acquisition: FR, Paris, ChampsÉlysées •L VMH Group • €62m
Acquisition: DE, Birkart portfolio • €68m
Acquisition: AT, Retail Warehouse Portfolio • €84m
Acquisition: AT, Mariahilfer Strasse, Generali CenteR • €50m
DIVESTMENT: DE, Rhijn Package (34 properties) • Aerium • €386m
Acquisition: UK, Glasgow, Princes Square • €135m
Acquisition AND DIVESTMENT: ES, Barclays Portfolio (24 retail units in 9 cities) • Barclays
Acquisition: NL, Utrecht, Oudegracht, • Breevast • €14m
Acquisition: DE, SinnLeffers Portfolio (Münster, Bielefeld, Kassel) • 2010/2011 • Lonestar • €93m
Acquisition: DE, Karstadt Portfolio (Hannover, Munich, Viernheim) • High Street Consortium • €45m
DIVESTMENT: BE, Genk (2 properties) • Wereldhave • €70m
PORTFOLIO MANAGEMENT
1841
1861
C&A manageS OWN PROPERTIES Clemens & August settled in Sneek, the Netherlands
1999
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2001
2002
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2004
UK, Edinburgh, Princes Street • redevelopment (re -letting to H&M in 2012)
BE, Sint-Pieters-leeuw UK, London, • extension & Oxford street refurbishment of • completion of shopping centRE phase 1 redevelopment • pre-let to Urban Outfitters and Schuh
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2006
2007
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2009
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2011
2012
UK, London, Oxford street • development of flagship store for Primark
DE, Viersen • DevelopmenT of city centRE shopping mall
FR, Aix-en -Provence, ALLÉES-PROVENÇALES • opening of a 15,000 sq m shopping avenue
DE, Mainz • Eco-Store, Redevelopment • BREEAM ‘Very Good’
Tr, Ankara • Construction of the Gordion Shopping CentER • 50,000 sq m of retail space, housing nearly 200 stores, a multiplex cinema and a hypermarket; parking for 2,000 vehicles • BREEAM CERTIFIED
BE, Retail park Drogenbos • Redevelopment of a retail park
FR, Bordeaux, Place Sainte Catherine • 2011-2015 • Inner city retail development project • Target breeam ‘very good’
NL, Gouda, Kleiweg • Inner city redevelopment • awarded the threestar ‘Very Good’ BREEAM-NL design certificate
2013
ASSET MANAGEMENT
opening of the asset first c&a retail management store in sneek, THE C&A STORY BEGINS... optimise value of existing portfolio through leasing, refurbishment and redevelopment
UK, total C&A BE, Sint-Niklaas portfolio • redevelopment • re-letting of 109 C&A of Waasland stores/ 500,000 sq m Shopping Center • the majority of the uk portfolio was re-let within 6 months’ to major brands: Next, H&M, GAP, Primark, New Look and Wilkinson
FR, Paris, Seine Rivoli • Inner city mixed use redevelopment project • Investment of €40m
DE, Berlin, Alexanderplatz • 2010-2014 • Mixed use property development project
Tr, Manisa • Construction of the Magnesia Shopping CentER • 4,500 sQ m hypermarket, 1,500 sq m cinema complex, 1,500 sq m food court and more than 8,500 sq m retail area spread over 65 units
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03/ asset management
Our understanding of retail allows us to tailor solutions for our tenants that deliver optimal benefits to all involved.
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03/ asset management
OVER THE LAST 170 YEARS, WE’VE LEARNT THAT ASSET MANAGEMENT REQUIRES CONTINUOUS MONITORING AND A HANDS-ON APPROACH. Our people fully understand the language of retailers and their customers.
Retail asset management is as much about psychology as it is about business. As a result, Redevco is an operator that invests, rather than an investor that is forced to operate. In turn, our knowledge and understanding allows us to provide retailers with bespoke solutions that develop optimal value for them – and our investors. Ultimately, we are all looking in the same direction. Retailers need profitable outlets so we help them by finding optimal sites, providing guidance on footfall, maximising the potential of the store in terms of layout, giving advice on increasing productivity and so on. Every asset is subject to an individual asset business plan that we monitor regularly. We know our asset management activities are successful through the following key indicators: high tenant retention, year-on-year growth in net income, and capital appreciation.
Our typical core asset management duties at a glance… Asset business plans We carry out an annual evaluation of strategic priorities for individual properties. This gives a tactical and operational plan for both us and the tenants. This also includes measures to ‘green’ our portfolio and make our buildings future proof. Tenant engagement We strive to keep our tenants in the loop. That includes regular contact at both strategic and operational levels and can include letting and re-letting issues. Billing Of course, we need to collect the rent diligently and consistently. This is normally managed either monthly or quarterly. Tenant monitoring As part of our monthly or quarterly management reporting, we include tenant risk monitoring and debtor analysis.
Mariahilfer Strasse, Vienna, Austria
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03/ asset management
case study
Our relationship with H&M resulted in extending their current store laterally to create a flagship store for Scotland.
ASSET MANAGEMENT uk 40 Princes Street, Edinburgh
Princes Street in Edinburgh, Scotland, was originally one of the main thoroughfares of the city. Now, it is mostly closed to private vehicles so public transport can take precedence but Princes Street remains Edinburgh’s principle shopping street, stretching over 1.5 km. At number 40 Princes Street, Redevco fully reconstructed and redeveloped the property into a mixed-use scheme totalling some 10,140 sq m. The property comprises two flagship retail BREEAM-certified units arranged over the basement, ground, first and second floors. On the third to seventh floors, Grade A office accommodation is provided. The two retail tenants were H&M and Optical Express while the office occupiers include such prestigious names as Aberdeen Asset Management, Reuters and Brewin Dolphin. In November 2012, one of the retail occupiers, Optical Express (Southern) Limited fell into administration but Redevco quickly negotiated and documented a flexible short-term lease with its solvent sister company, Optical Express Ltd. That way continuity of income was ensured for the time being. Meanwhile, Redevco’s partnership with H&M led to a swift negotiation of Heads of Terms to extend their current store laterally and create a flagship store for Scotland. Contracts were exchanged in January 2013 with H&M assuring a 15-year lease. As a result, there was a valuation uplift on the property of some £2.4m.
10,140 s q m m i x e d u s e r e d e v e lo p m e n t s c h e m e
£2.4m VALUE UPLI F T TH ROUGH ASSET MANAGEMENT
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03/ asset management
study
14m
ASSET MANAGEMENT belgium
case
HOW ATTENTION TO DETAIL SERVED TO ENHANCE ONE OF THE MOST IMPORTANT RETAIL PARKS IN BELGIUM.
Paul GiLsonlaan 455 , Drogenbos Retail Park
Cascade Shopping in Drogenbos is one of Belgium’s most important peripheral retail parks. It is located in the outskirts of Brussels in the heart of an important retail hub near the Ring Road, which connects the E19 from Antwerp to the E19 towards Nivelles and Paris. In 2012 Cascade Shopping was reopened after a major two-year redevelopment project. Some big-name tenants were secured for the 29,000 sq m centre, including Carrefour Planet, Brico, Dreamland, Lunch Garden, SportsDirect.com, Luxus, PointCarré, Auto 5, Quick and Pizza Hut. The retail park has parking space for more than 800 cars. Redevco has invested €12m in the redevelopment project. The complex was originally built in the 1970s and was in sore need of renovation when Redevco started redeveloping it in early 2010. The out-dated Disport store was demolished to create new two-storey units for SportsDirect. com, PointCarré and Luxus. The existing Brico store was also demolished to make way for a new Dreamland. Brico and Brico Garden are now housed in a new combined store in the complex. The redevelopment project targeted the entire infrastructure, creating new parking facilities and a new promenade. The Carrefour façades were also given a facelift, giving the whole site a fresh and modern look. The architecture is more innovative and aesthetically pleasing than usual in retail parks. This project is in line with Redevco’s ambitious redevelopment policy, which is aimed at renovating and optimising the complexes in its portfolio, creating A-grade retail properties. In December 2012 Redevco purchased an adjacent retail property, which is let to retailers Carpetright (floor coverings) and X2O (bathroom furniture and fittings). It also includes some office space, let to Carpetland. This purchase will enable Redevco to further enhance the comfort of Cascade Shopping.
value growth after profit
29,000 s q m r e ta i l r e d e v e lo p m e n t
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03/ ASSET MANAGEMENT
case study
NOW REDEVCO MAKES THE MOST OF A PRESSING SITUATION IN THE MIDDLE OF BORDEAUX.
ASSET MANAGEMENT/ DEVELOPMENT FRANCE Promenade Sainte Catherine, Bordeaux
Situated in the heart of Bordeaux near the intersection of the two prime high streets – the mass-market Rue Sainte Catherine and the slightly more upmarket Rue de la Porte Dijeau – is a C&A store owned by Redevco. The opportunity arose to buy a large but redundant newspaper office behind the C&A store, which would allow for the development of an inner-city retail project. The project will connect to both the Rue de la Porte Dijeau and Rue Sainte Catherine, creating a new retail circuit in the heart of Bordeaux encompassing the two strongest retail streets. Owning C&A meant that we were the only party who could create such an opportunity. Thanks to a very proactive approach that creates value and optimises existing assets, we are shaping a new inner city shopping area in Bordeaux. It also optimises the location of C&A as it will relocate to the Rue Sainte Catherine, which is a better fit in terms of client profile versus the more upmarket Rue de la Porte Dijeau. This project targets the BREAAM ‘Very Good’ certification both during the construction phase and in use. It combines respect for the environment with an integrated architectural setting that adds value to the city.
27,000 SQ M mixed use development
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03/ ASSET MANAGEMENT
case study
MIXED USE IN THE CENTRE OF BERLIN MAXIMISES REAL ESTATE VALUE.
ASSET MANAGEMENT/ DEVELOPMENT GERMANY ALEA 101, Alexanderplatz, Berlin
Located right next to the Alexanderplatz transport hub and the monumental Berlin TV tower, ALEA 101 is a mixed-use property (19,000 sq m) combining 10,000 sq m of retail with offices and high-end apartments. Tenants include TK Maxx, Vapiano, Kult, ShoeCity, Coffee Berlin and “I love Berlin”. ALEA 101 is designed as a 30-metrehigh stand-alone cube with five floors and a basement. This commercial and residential building will be in a class of its own. Elegant, flexible and modern. Ideally located with excellent transportation connections. With breath-taking views over the historical heart of the German capital. This façade faces the Cinestar cinema and Rathaus-Passagen retail promenade. The other façade faces south onto the plaza adjoining the Berlin TV tower. ALEA 101 is a ‘green’ building, which will be assessed according to an internationally recognized certification system for sustainable buildings (BREEAM) and has already been awarded a Gold pre-certificate by the German Sustainable Building Council (DGNB). ALEA 101 will be available in spring 2014.
19,000 SQ M of retail, offices and residential
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04/ PORTFOLIO MANAGEMENT
we are an experienced portfolio manager. We make strategic decisions about our investments. We aCquire, develop and trade for value.
Oudegracht, Utrecht, The Netherlands
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04/ PORTFOLIO MANAGEMENT
Our portfolio management approach is hands-on and active. With strong local teams and partners we focus on income and SUSTAINABLE growth. ability to buy, fix and know when to sell In-house research Our properties for value is the result of close combined with local cooperation between our local teams and our knowledge enables network of developers and property owners. focus is fixed firmly on income and growth us to make solid but Our segmented into the following three disciplines: decisions on portfolio adjustments. Acquisition • Identifying the correct deals is paramount to our success.
• We offer independent evaluation and recommendation.
• We structure advantageous deals and exercise due diligence.
• W e utilise our scale and coverage. • We recognise that retailers are not property managers so we offer sale-lease-back opportunities allowing retailers to focus on the business of selling goods.
Enhancing value • Redevco has the capability to unlock and enhance real estate value.
• Each asset has its own business plan, including asset enhancement strategies. As an investor focused on sustainable growth, ‘greening’ our portfolio is an active part of enhancing value.
• We are primarily driven by cash-flow returns. Divestment • Timing is everything. We monitor market cycles to judge entry and exit points.
• Every asset is carefully checked against performance criteria in the business plan.
• We conduct formal hold/sell analyses annually. • Our local teams monitor appetite and adjust their activities on an ongoing basis.
• Strong local teams and partners focus on income and growth.
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04/ PORTFOLIO MANAGEMENT
8m
study
1.1bn
PORTFOLIO MANAGEMENT/ ACQUISITION BELGIUM
case
A single transaction lifted Redevco’s European portfolio value from €4.1 billion to more than €5 billion.
GIB IMMO
In 2001, in a transaction worth well over € 1 billion, Redevco acquired Belgium’s largest commercial real estate company GIB Immo and significantly strengthened its position in the Belgian market. The acquisition was a major step in Redevco’s long term strategy to increase the diversity of its portfolio in terms of tenant mix and geographical spread. With this one transaction Redevco expanded its European portfolio from € 4.1 billion to well above € 5 billion. At that time, GIB Immo owned more than 300 properties and managed an additional number of 80 assets for others. The portfolio, representing 2 million sq m of buildings and 6 million sq m of land, comprised a variety of multi-chain retail sites, department stores, stores in shopping centers and prime city centres, town centres and suburban locations. Its most important tenants were Carrefour, Inno/Kaufhof and multiples such as Ikea, HEMA, Zara, H&M and Brico. To date Redevco is the number one retail real estate investor in Belgium with a focus both on investment management, development and redevelopment. Currently Redevco Belgium has invested assets worth € 1.8 billion (GAV) comprising 287 properties in 186 locations. The high occupancy rate of 99.2% clearly reflects the quality of the portfolio. Most of the properties are in Flanders (50%), while about 28% are in the Walloon part of the country and 22% in Brussels. Hypermarket and supermarket chains as well as clothing retailers are still the main tenant categories. Redevco Belgium employs some 50 people to manage this high performing portfolio.
Gr o s s A s s e t V a l u e
sq m owned across Belgium
Meir, Antwerp, Belgium
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04/ PORTFOLIO MANAGEMENT
case
PORTFOLIO MANAGEMENT/ ACQUISITION GERMANY
study
Münster 9,300 sq m Kassel 13,000 sq m Bielefeld 16,000 sq m
Buying strong property FUNDAMENTALS to create a win-win Situation for owner and tenant.
In 2010 Redevco acquired three of SinnLeffers prime retailing locations in the pedestrianized city centres of Münster, Kassel and Bielefeld for a net purchase price of €93 million. This created a win-win situation for both parties involved. The acquisition enabled Redevco to diversify its tenant mix, adding three prime high street locations to the portfolio. In addition these three properties presented the opportunity to lift value via rent increases, via activation of under utilised areas through active management and a reduction of the risk profile. For SinnLeffers this transaction created the opportunity to re-invest the returns into their core business of fashion retailing. Redevco plans to hold these properties for the long-term and focus on enhancing their value. The opportunities here are numerous; from re-letting as a whole or splitting up into smaller units. This asset management initiative brings with it complete flexibility and, at the same time, minimal risks to the cash flow relative to the potential for enhanced value.
93m
N e t p u r c h a s e p r i c e i n 2010/2011
104m
CU R R ENT F AI R MA R KET VALUE Friedrichsplatz, Kassel
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04/ PORTFOLIO MANAGEMENT
case study
A clear strategy and the power to execute in a short time frame is what made the acquisition of the Barclays portfolio in Spain truly successful.
PORTFOLIO MANAGEMENT/ ACQUISITION & divestment SPAIN BARCLAYS PORTFOLIO Reflecting Redevco’s strategy at that time to enhance the quality of its prime portfolio and its well-known international tenant base, Redevco acquired 24 retail units and commercial buildings, 8,900 sq m in total, from Barclays Bank in Spain in 2008, with the intention to keep the prime assets and divest the rest. The €65 million transaction included a long term lease-back agreement with Barclays. The properties were located in prime retail high streets in nine Spanish cities including Madrid, Barcelona, Sevilla, Málaga, Bilbao, San Sebastian, Alicante, Vigo and Valladolid. This transaction brought the total portfolio value of Redevco Spain and Portugal to €750 million. The success of this transaction lies in the underlying strategy and execution power to dispose of the 18 lower quality units for a profit and to only hold on to the six prime assets. The six top quality properties added real value as they reinforced Redevco’s high-street portfolio within prime locations. The estimated value of these properties was 61% of the total purchase price. The fact that Redevco also bought the additional 18 properties created the bargaining power to negotiate the final rents and the lease contract terms. This was critical to successfully closing the deal. Redevco managed to divest the 18 non-core units in only eight months for a profit of €2.3 million.
8,900 s q m o f c o m m e r c i a l a n d r e ta i l s pa c e
Plaza de la Marina, Málaga, Spain
65m
a Cq u i s i t i o n v a l u e
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t r a n s act i o n va lu e
42,700
study
70m
PORTFOLIO MANAGEMENT/ divestment belgium
case
Making selective disposals to upgrade the quality of the portfolio is what we call a strategic divestment.
Shopping 1 and Stadsplein/ Martinusplein, Genk
At the end of 2011 Redevco decided to further focus on prime properties in its core markets in Europe. In addition, Redevco decided to put more emphasis on upgrading the quality of its existing portfolio and making selective disposals in response to the new economic environment and the changing retail landscape. As part of this exercise Redevco sold the ownership of its Genk portfolio in Belgium to Wereldhave in a ₏70 million transaction. This strategic divestment concerned two properties in the city of Genk: the shopping centre, Shopping 1 and the development Stadsplein/Martinusplein. Genk Shopping 1, located in the centre of Genk, is Belgium’s oldest shopping centre with tenants such as Carrefour, Sportsdirect, MS Mode, WE, America Today and Lunch Garden. Redevco owned 83% of Shopping 1; the rest was owned by about 30 small private investors. From 2006 onwards Redevco worked in a joint venture with ING Real Estate Development (JV taken over by Wereldhave Belgium) on a renovation and extension plan for the shopping centre. The plan was agreed with all co-owners and had the full support of the city of Genk including all the required permits. This allowed the new owner to fully renovate the shopping area and extend it by 11,500 sq m. The total lettable area after completion of all construction activities is 27,100 sq m. The second property, Stads-en Sint-Martinusplein, is a mixed inner-city development that dates back to 2007/2008. The commercial part comprises about 30 commercial units including Delhaize, C&A, H&M, Zara, JBC and HEMA, with a total lettable area of approximately 15,600 sq m. Through coordinated management of both shopping complexes, an attractive and balanced offer could be provided within the city centre of Genk. However, carefully considering the amount of investment needed for Shopping 1, the total exposure of real estate in the relatively small city of Genk after the redevelopment and the current strategy of Redevco to focus on prime properties, divestment of the Genk portfolio was successfully concluded.
sq m lettable area after completion
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THE COMBINATION OF STRATEGIC, TACTICAL AND OPERATIONAL DISCIPLINES ALLOWS REDEVCO TO BE CONSISTENTLY ADEPT AT DELIVERING ATTRACTIVE RETURNS BY MANAGING INVESTMENT IN RETAIL PROPERTY.
Avenue des Champs-Élysées, Paris, France
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core tasks The core tasks of the investment management team at a glance: Property portfolio strategy and strategic asset allocation This is our long term vision for the portfolio as a whole, supported by detailed understanding of both macro and micro socio-economic fundamentals and applied against the operational portfolio property. Our strategic asset allocation model provides a well researched and considered approach to asset allocation to various sectors, geographies and so on, within the portfolio. Governance decisions and post audit and performance management We determine the impact of the potential property acquisition and funding structure on the portfolio as a whole. We review adopted assumptions and forecasts and take remedial action if required. Our investment committees make the formal accept-or-reject recommendations for potential property acquisition, improvement or disposal. Reporting Our regular reports – quarterly, annual or strategic – are bespoke to match investors’ requirements and adhere to INREV best practice guidelines.
Princes Square, Glasgow, UK
AT REDEVCO, WE’RE IN THE BUSINESS OF OPTIMISING RETURNS BY INVESTING IN RETAIL PROPERTY. FROM VISION TO COMPLETION, REDEVCO IS YOUR TRUSTED PARTNER. Our expert investment management team specialises in the strategy, performance and reporting processes of individual investment vehicles. No two investor requirements are exactly alike, so every strategy that underpins the return on investment is tailor made and managed in bespoke fashion. We consider the requirements of the investor and set a concept accordingly. Once this vision is in place, we develop the strategy, taking into consideration prevailing market conditions and expectations. During this initial process, the investment management team draws on internal and external sources, including Redevco’s own research and deal-sourcing teams. The investment team is responsible for the performance of the vehicle during its lifetime, supported in the implementation of strategy by locally based portfolio management teams. In this way, we inherently incorporate bottom up assessments of asset performance to determine whether explicit action is necessary to bring an investment to its full potential and drive wider portfolio growth.
Reporting is also a core focus of the investment management team. With continuous assessment and regular reporting there are no surprises about the performance of the investment vehicle for investors; investors are kept appraised of the current performance of the asset as well as factors that might influence future value. Our reporting is consistent, understandable, reliable and fully compliant with INREV guidelines. Redevco is currently managing several portfolios on behalf of different investors, like a portfolio of existing prime assets, the COFRA C&A portfolio and the core portfolio. We are planning to leverage on our existing platform to continue growing its investment management activities.
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PORTFOLIO: existing prime assets
200 Oxford Street, London, UK
111-123 Rue Neuve, Brussels, Belgium
82-84 Meir, Antwerp, Belgium
This portfolio is managed by Redevco on behalf of COFRA. It contains six existing prime assets of which the four buildings in Belgium and France have been acquired by Redevco over the last 13 years. Together with the two buildings in the United Kingdom, that have historically been part of the Cofra portfolio, they form this closed vehicle. In 2002 Redevco started an intensive redevelopment project of the building on 200 Oxford Street. This re-established the landmark on one of London’s most famous shopping streets as a top commercial and residential address.
This stable, wealth-preserving portfolio with an attractive risk-to-return profile and return on equity can be characterized as:
500K
65 Rue de Rivoli, Paris, France
• Tier 1 city • Prime, inner city, A1 location • High footfall density catchment area with a minimum population of 500,000
70-72 Avenue des Champs-Élysées, Paris, France
HIGH FOOT FALL dens it y CATCHMENT AREAS
• Low re-letting risk
376-384 Oxford Street, London, UK
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PORTFOLIO: COFRA C&A
This vehicle is managed by Redevco to secure COFRA’s strategic C&A locations featuring wealth preservation. The 160 properties house C&A’s stores in the top eight retail markets in Europe: Austria, Belgium, France, Germany, The Netherlands, Switzerland, Portugal and Spain. All activities are focused on optimising cash returns and liquidity.
160 S t r at e g i c l o c at i o n s
Boulevard Haussmann, Paris, France
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PORTFOLIO: CORE The core portfolio is a diversified pan-European real estate investment with exposure to major European markets. It is balanced across the real estate risk-to-return curve comprising prime to value-add types of assets with a core of prime retail properties. This portfolio, with a conservative financial profile and an excellent tenant base, secures a stable cash flow.
470 leases in 60 assets
Les AllĂŠes Provencales, Aix-en-Provence, France
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06/ summary
With a proven track record in retail real estate we are uniquely positioned to build tailored investment vehicles that provide stable income and solid growth. • A pan-European retail real estate specialist. • More than 200 dedicated professionals using their
expert knowledge to provide access to prime retail investment opportunities.
• Over 500 properties in prime retail locations in Europe’s
most resilient markets.
• Local teams who speak the language of shoppers, retailers,
developers and investors with a vast experience in asset, portfolio and investment management.
• Strategic decision making based on in-house research
combined with on the ground know-how.
• Buying, fixing and selling for value, creating sustainable
income and profitable growth.
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Redevco Head Office Wibautstraat 224, 1097 DN Amsterdam, The Netherlands +31 20 599 6262
Redevco Netherlands Rembrandt Tower, Amstelplein 1, 1096 HA Amsterdam, The Netherlands +31 20 521 8730
Redevco Belgium Zaterdagplein, 1/1 Place du Samedi, 1000 Brussel/Bruxelles, Belgium +32 2 645 3700
Redevco Spain Plaza Marqués de Salamanca, 3-4, 2ª planta, 28006 Madrid, Spain +34 91 432 3230
Redevco France 14, rue Auber, 75009 Paris, France +33 1 4265 7200
Redevco Switzerland Bahnhofstrasse 73, 8021 Zürich Postfach 2076, Switzerland +41 44 213 1550
Redevco Germany Bleichstraße 14, 40211 Düsseldorf, Germany +49 211 173 3790
Redevco United Kingdom 1 James Street, London W1U 1DR, United Kingdom +44 20 7409 9777
Misrepresentation Act 1967: The particulars contained in this brochure are believed to be correct but cannot be guaranteed. All liability, in negligence or otherwise, for any loss arising from the use of these particulars is hereby excluded. September 2013. Designed and produced by Sutton Young (SYO50510)