NEPI Rockcastle has achieved 12.3% growth in net operating income (NOI) to €411m during the first nine months of 2024 versus the same period in 2023. On a like-for-like basis, NOI increased by 8.4%, driven by higher rentals, short-term income and the management of operating costs, says the Group.
Tenant sales increased by 9% on a like-for-like basis (excluding hypermarkets) while footfall in its assets increased by 1.4% with the European Public Real Estate Association (EPRA) vacancy rate decreasing to 2.3% at the end of Q3 2024 (June 2024: 2.7%). Rent collection for the period was 99% as at the end of October 2024.
“We continue to see solid growth across our markets, driven by strong tenant performance and the impact of active asset management. The average basket size continued to grow through the third quarter at roughly the same pace as in the first half of the year. Our team continues to excel in making our properties more attractive for consumers and retailers and in leveraging the Group’s leading position in Central Eastern European’s (CEE) commercial retail environment. Our strong leasing activity contributed to reducing the vacancy rate to 2.3%, which, combined with rental uplifts and improved cost recovery, ensured that NOI continues to grow at very healthy rates,” comments NEPI Rockcastle CEO, Rudiger Dany.
In late September 2024, NEPI issued €500 million of green unsecured bonds maturing in January 2032. The issue, which was six times oversubscribed, resulted in favourable financial terms – a fixed coupon of 4.25% and an issue price of 99.124%. In that same month, one of its existing revolving credit facilities was increased by €50 million, leading to an overall €670 million in available committed revolving credit facilities.
The Group announced several major events post-September 2024 which will impact its yearend; on the 1st of October 2024, NEPI completed the acquisition of Magnolia Park, a 100 000m2 GLA shopping centred in Wroclaw, Poland, for a total cash consideration of €353 million.
On the 7th of October 2024, the disposal of the Group’s last remaining asset in Serbia, Promenada Novi Sad, was concluded for cash proceeds amounting to €177 million.
NEPI shareholders were offered an option to receive scrip for the H1 2024 dividend distribution which saw a 39% take-up rate with no discount being offered. The scrip issue was the equivalent of raising €70 million in equity and on the 17th of October 2024, the Group raised €300 million through an issue of new shares at a price share of R137.85 (€7.19), representing a discount of less than 1% compared to the last reported Net Reinstatement Value per share.
The net additional funds raised from the combined effect of these actions, together with the existing cash as at 30 September 2024, led to a loan-to-value (LTV) ratio of 29.2% as at the end of October. The funds will be used to repay a €500 million bond maturing in November 2024 and finance the Group’s significant and highly promising acquisitions and development pipeline.
The value of its investment portfolio was €7.1 billion as at 30 September 2024 (with Promenada Novi Sad still on the Group’s balance sheet, as the effective disposal date was in October, and without Magnolia Park effectively under Group’s ownership from 1 October), marginally higher compared to June 2024. No property valuations were performed during Q3 2024.
NEPI Rockcastle’s Board anticipates distributable earnings per share for the year to be approximately 5.5% higher than 2023 based on a 90% dividend payout ratio.
