Quarterly business update for three months to 30th June 2022

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Acquisitions

We continued our efforts towards the completion of our two Berlin acquisitions in Berlin, Germany which are expected to be finalised in the third quarter of 2022. In Warsaw, Poland, we were in advanced stage of negotiations on substantial development opportunity which has been successfully signed in July 2022.

Leasing update

We have managed to lease almost 16,000 sq m of GLA during the second quarter of 2022. Four largest deals totalled almost 7,000 sq m of GLA. Overall, we have signed almost 59,000 sq m of GLA in the first half of 2022 with annual passing rent over €15 million.

Completions and developments progress

We have announced the name of our second German project, PLTFRM.Berlin, with a commitment to be carbon neutral in operation. The construction start is expected this fall and the project should be completed in early 2025 with around 27,000 sq m of GLA.

For press release on our new Berlin development click here.

Following the handover of Forest Tower in the first quarter, we focused on progressing the construction of other projects, with Varso Tower reaching final stages of completion in the second quarter and obtaining the occupancy permit in July 2022. Varso Tower, the tallest building in the EU, is now ready to welcome its new tenants.

Financing

During the second quarter of 2022, we have managed to draw down €581.0 million of external debt financing of which €363.6 million of existing debt was refinanced, €112.4 million was primarily linked to properties currently under construction and €105.0 million was linked to general corporate purposes and to secure sufficient liquidity that is needed for bond buyback programme in Slovakia and Czechia.

We are especially proud that we have secured a green investment loan from HSBC UK for our Bloom project and thanks to its sustainability credentials including net zero carbon target.

For press release about the green loan click here.

We have continued being present at capital markets and issued €50 million of Slovak bonds with 4-year maturity as well as repaid €20 million of maturing Slovak bonds.

The bond buyback programme in Slovakia and Czechia has been launched in the second quarter and will continue during summer and fall. We are aiming to buy back and exchange bonds in the total aggregate amount up to €169.1 million.

At the end of the quarter, the Group had €1.72 billion of bank financing along with €334.3 million of bond financing outstanding and €101.0 million of committed bank financing to be drawn down, mainly against future capital expenditures on projects Nove Apollo and Worship.

Divestments

As previously announced, we have decided to divest Lodz plot in Poland. The transaction is still pending and is expected to be finalised later this year.

HB Reavis portfolio

Income producing portfolio

As of the end of the second quarter, the Group held an income producing portfolio of 10 office and 1 retail properties with a total GLA of 461.0k sq m across five countries with annual operating income at full occupancy of €118 million. The portfolio includes the following projects:

The market value of the portfolio reached €2.05 billion as of 31 December 2021 based on independent valuations.

Projects under construction

Projects currently in the phase of construction (or demolition) account for 147.5k sq m of future GLA in four buildings and estimated future gross development value of around €1.11 billion as of 31 December 2021 based on expert valuations, all spread over four capital cities:

Awards

We are pleased to share amazing news that HB Reavis is the second most valuable office developer brand in Europe and the most valuable office developer brand in Central and Eastern Europe. The award has been announced at the Real Estate Brand Award 2022 Gala, organised by the European Real Estate Brand Institute in Berlin. This is the second year in a row that we’ve been recognised as one of the most valuable European real estate brands.

For press release about the awards click here.

At the same time our project DSTRCT.Berlin has been named the “Best New Building” at the ImAwards run by Immobilien Manager magazine in Berlin, Germany.

 

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Forward-Looking Statements
Certain statements contained in this release are “forward-looking”, based on current view on our markets, activities and prospects and involve risks and uncertainties that could cause actual results to differ materially from those expressed or implied by such forward-looking statements. In addition, we, through our management, from time to time, make forward-looking public statements concerning our expected future operations and performance and other developments. All forward-looking statements included in this release are made only as of the date hereof and no representation, assurance, guarantee or warranty is given in relation to them and HB Reavis assumes no obligation to update any written or oral forward-looking statements made by us or on our behalf as a result of new information, future events or other factors.
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The information contained in this announcement is for background purposes only and does not purport to be full or complete. No reliance may be placed by any person for any purpose on the information contained in this announcement or its accuracy, fairness or completeness. This announcement is not for publication or distribution, directly or indirectly, in or into the United States. The distribution of this announcement may be restricted by law in certain jurisdictions and persons into whose possession any document or other information referred to herein comes should inform themselves about and observe any such restriction. Any failure to comply with these restrictions may constitute a violation of the securities laws of any such jurisdiction. This announcement does not contain or constitute an offer of, or the solicitation of an offer to buy, securities to any person in any jurisdiction, including the United States, Australia, Canada or Japan. The securities of the Company have not been and will not be registered under the US Securities Act of 1933 (the “Securities Act”), or under any applicable securities laws of any state or other jurisdiction of the United States and may not be offered, sold, resold, transferred or delivered, directly or indirectly, in the United States unless registered under the Securities Act or pursuant to an exemption from, or in a transaction not subject to, such registration requirements and in accordance with any applicable securities laws of any state or other jurisdiction of the United States. No public offering of any securities discussed herein is being made in the United States.
This announcement contains or may contain forward looking statements regarding the Company and its subsidiaries and its future business. Such statements are not historical facts and may include opinions and expectations about management confidence and strategies as well as details of management’s expectations of new and existing programs, technology and market conditions. Although the Company believe their opinions and expectations are based on reasonable assumptions, these forward-looking statements are subject to numerous risks and uncertainties, not all of which will be exhaustively explored in this announcement or elsewhere. Accordingly, the recipients should not regard such statements as representations as to whether such anticipated events will occur nor that expected objectives will be achieved. The recipients are reminded that all forward-looking statements in this announcement are made as of the date hereof and for the avoidance of doubt the Company does not undertake to update any such statement made to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events. For the avoidance of doubt, the Company does not accept any liability in respect of any such forward-looking statements.
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