Icade has finalized more than 700 million euros in bank financing – 01/04/2023 at 11:13 am


(AOF) – Icade finalized more than 700 million euros of bank financing during the month of December, enabling it to anticipate the next maturities of 2024, to strengthen its liquidity and to increase the share of its sustainable financing. The real estate developer thus refinanced in advance 200 million euros, i.e. the majority of its 2024 maturities. The maturity of these bank loans was postponed, for the most part, from 2024 to 2029, in return for “very limited” margin.

The group, benefiting on June 30 from a debt coverage rate of 94%, with an average maturity of more than 6 years, “the impact of these refinancings on future net current cash flow will be limited”.

Icade has also subscribed to undrawn lines of credit in the amount of 525 million euros with an average maturity of over 6 years, including 350 million euros in refinancing of lines maturing in 2024 and 175 million euros new lines. These signatures bring the total volume of undrawn secured credit lines from 1.9 to 2.1 billion euros and thus strengthen the group’s liquidity. Their margin is comparable to that of refinanced credit lines.

100% of this new funding is responsible.

AOF – LEARN MORE

Key points

– Fifth in France and first in Europe for offices and business parks, with a real estate portfolio worth €12.2 billion;

– Integrated real estate group organized into 3 divisions: tertiary property (68% of assets, 3/4 split between offices and tertiary parks), health property (32%) and development;

– “Design, build, manage, invest” business model, based on the synergies between the poles: resilience of the health real estate company supporting the development of the tertiary real estate company, valuation of the latter’s costs through development, in particular for Greater Paris and the TGV metropolises;

– Offices located 95% in Ile-de-France (20% in Paris and 1/4 in La Défense);

– Capital controlled at 39.2% by Caisse des Dépôts, ahead of Crédit Agricole with 19.1%, Frédéric Thomas heading the Board of Directors and Olivier Wigniolle being Chief Executive Officer;

– Solid balance sheet: LTV ratio of 40.1% and liquidity of €2.9bn covering debt maturities up to 2026.

Challenges

– 2025 Strategic Plan:

– leader in offices in Greater Paris and metropolitan areas, with €5.7 billion in revenue,

– 1st European health property company, through the international development of Icade Santé, 58.3% owned,

– leading player in property development with €1.4 billion in revenue and 7% margin,

– 4.5% annual growth in net current income;

– Innovation strategy broken down into 3 themes – housing of tomorrow, office of the future (proptech, coworking and third places) and health and well-being in the city – and based on intrapreneurship, co-innovation through start-up incubation -up, via Paris&Co, Creative Factory or H7…, and partnerships;

– Reinforced “Low Carbon by Icade” environmental strategy, validated by the SBTi and approved by the resolution “Say on climate and biodiversity”, via:

– objective of carbon neutrality in 2050 throughout the value chain,

– reduction of the footprint with partners via a climate fund endowed with €2.5 million,

– 2022-26 investment plan of €150 million,

– biodiversity: 100% of business parks and 46% of constructions in positive biodiversity in 2021 and + 170,000 m2 of natural spaces restored and maintained since 2016;

– integration of ESG criteria in bond issues;

– Development pipeline of €1.7 billion in the tertiary sector, portfolio of +€1 billion in health investment projects and order book of €1.7 billion in property development;

– Indexation of rents on the cost of construction favorable to the growth of income in the tertiary and healthcare divisions;

– Rent collection rate of 99%, compared to an average of +70% for the sector.

Challenges

– Change in revalued net assets or ANR, of €90.6, key data for the property sector to be compared to the stock market price and the occupancy rate (87.2%) for property companies);

– Energy inflation: securing gas and electricity purchases until early 2024 and adapting consumption, in partnership with the Ecowatt system;

– Maintaining the European growth of Icade Santé, the sharp rise in interest rates having led to a slowdown in investments;

– 2022 objective, confirmed, of a +4% increase in net current cash flow for the group and of 5 to 6% for health property and a 3 to 4% increase in the dividend.

Find out more about the real estate sector

A demand crisis

According to data from the Federation of Property Developers (FPI), the figures for the third quarter of 2022 continue to be alarming. Sales of new collective housing fell by 12.4% over one year, to 19,006 units. Over the first nine months of 2022, the decline reached 10.2%, to 72,670 units.

Reservations are also plummeting due to the collapse of bulk sales to social landlords and institutional investors. As interest rates rise, institutional investors renegotiate or halt operations. First-time buyers are penalized by the rise in rates and the tightening of the Pinel system puts off some private investors.

Due to the sharp rise in construction costs, the REIT estimates that one out of six authorized operations is ultimately not carried out for economic reasons.

Faced with this, prices are still rising: the sale prices of new collective housing increased by 5.9% throughout France in the third quarter of 2022. Ile-de-France is an exception, with a drop of 0, 9%.



Source link -86