Quarterly business update for three months to 31 December 2019

· 9 min. read
Download pdf

HB Reavis has hereby published its Quarterly Business Update for three months ended on 31st of December 2019. You may read the full report below, or download in pdf.

Executive changes

Róbert Kubinský has been appointed as the new CEO of our Hungarian operations, replacing Jan Hübner who has stepped down after three years. Róbert will be leading team of 70 people and overseeing the delivery of the second stage of Agora Budapest. He joined our company 8 years ago as the Head of Operating Finance and led the HR Department for the last two years. For further information, please see the press release.

 

Acquisitions

No acquisitions were made during the reported quarter.

 

Leasing update

We signed 26.9 thousand sq. m of new leases or renewals during the last quarter (excluding leases related to HB Reavis CE REIF).

The largest tenants signed during 4Q 2019:

  • Nivy Station (Bratislava) – Inditex (7.1 thousand sq. m)
  • Nivy Station (Bratislava) – LPP (5.8 thousand sq. m)
  • Varso 2 (Warsaw) – Orsted Polska Sp. z o.o. (3.8 thousand sq. m)

With the above, the total leased area signed in the past four quarters of 2019 was 135.3 thousand sq. m (excluding leases related to HB Reavis CE REIF).

Read the full press release on Inditex here.

 

Completions and developments progress

There are 11 projects with over 485.7 thousand sq. m of GLA (Gross Leasable Area) currently under construction, many of which have been progressing well during the last quarter, taking noticeable shapes already. These include projects across five countries, namely:

 

One Waterloo, London
During the last quarter of 2019 the Lambeth Council has voted unanimously in favor of the proposal for the redevelopment of our Elizabeth House site in Waterloo. Designed by Stirling Prize-winning architects AHMM, the plans will create around 1.2 million sq. ft (110 thousand sq. m) of workspace supporting up to 11,000 jobs, creation of a brand-new retail and a transformed public realm next to the Waterloo Station – the UK’s busiest train station. For further information regarding the planning approval see the press release.

Nivy Station, Bratislava
Construction on the Nivy Station has reached its highest point and is well underway to be completed by the end of 2020.

Construction completions
Construction is well progressing on all sites, with four projects expected to be completed within 6 months. These include Nivy Tower (1Q 2020), Varso 1 (1Q 2020), Varso 2 (2Q 2020) and Agora Tower (2Q 2020).

 

Financing

HB Reavis continued its activities on capital markets with the issuance of third retail tranche of €25m as part of our €150m regional bond programme, launched at the end of 2018. During the last quarter, HB Reavis has drawn down a total of €114.7m of external debt financing including €25m of bonds. At the end of December 2019, the Group had €691.1m of bank financing (excluding €3.0m assigned to Joint Ventures), along with €384.4m of bond financing outstanding. As of the end of the quarter, the Group had €476.3m of committed bank financing to be drawn down, mainly against the future capital expenditures of Varso Place, Agora, Nivy Station and Nivy Tower.

 

Divestments

Twin City Tower, Bratislava
We have successfully finalized the divestment of Twin City Tower in Bratislava to Valesco Group, a London headquartered European real estate investment manager, along with AIP Asset Management, a Seoul headquartered asset manager backed by South Korean institutional capital.

Twin City B, Bratislava
We have entered into exclusive negotiation for potential divestment of Twin City B with the aim to finalize the transaction in 1Q 2020. Twin City B was completed in 2016 and has 23,5 thousand sq. m of GLA.

Postepu 14, Warsaw
We have entered into exclusive negotiation for potential divestment of Postepu 14 with the aim to finalize the transaction in 1Q 2020. Postepu 14 was completed in 2015 and has 34,5 thousand sq. m of GLA.

 

WaaS update

HubHub
Our co-working business line, HubHub, continued its expansion progress. As previously indicated, new operations in Prague and in London have increased our co-working portfolio to eight co-working spaces – three in Prague, two in Warsaw, Bratislava, Budapest and London with a total GLA of 22.7 thousand sq. m and over 2,000 members. The new location is planned to open in Nivy Tower where it is going to be spread over three floors, covering an area of 3,6 thousand sq. m, and accommodating 590 members.

Symbiosy
Symbiosy, part of our WaaS portfolio, is revolutionizing the workspace experience by collecting data and turning it into actionable insights which make buildings predictive and proactive. We are intensifying our market presence by actively engaging with customers in Middle East, London, Warsaw, and Budapest.

Qubes
Nivy Tower is going to accommodate Qubes as well, our newest business line offering flexible space leases, with almost 6.0 thousand sq. m. Furthermore, Qubes has also signed lease for over 8.5 thousand sq. m in Agora Hub in Budapest, another project under construction. With that, Qubes will operate at least two locations by Q2 2020, further supporting HB Reavis’ Workspace-as-a-Service efforts.

 

HB Reavis portfolio

Income producing portfolio
As of the end of the last quarter, the Group held a portfolio of 8 income producing office properties with a total of 169.3 thousand sq. m across four countries. The portfolio includes the following projects:

The overall market value of the portfolio totaled up to €0.8bn (including One Waterloo) as of 30 June 2019, while the weighted average occupancy across the portfolio was 90% at the end of the last business quarter.

Projects under construction
Projects currently in the phase of construction (or demolition) account for 485.7 thousand sq. m of GLA and estimated future gross development value of around €2.5bn, all spread over five capital cities:

 

Subscribe to our financial news & updates

"*" indicates required fields

Agreement*
NOT FOR PUBLICATION, DISTRIBUTION OR RELEASE, DIRECTLY OR INDIRECTLY, IN WHOLE OR IN PART, IN OR INTO THE UNITED STATES, AUSTRALIA, CANADA, JAPAN OR ANY OTHER JURISDICTION IN WHICH OFFERS OR SALES WOULD BE PROHIBITED BY LAW. THIS PRESS RELEASE CONTAINS INSIDE INFORMATION FOR THE PURPOSES OF THE MARKET ABUSE REGULATION. THIS PRESS RELEASE AND THE INFORMATION CONTAINED HEREIN IS FOR INFORMATION PURPOSES ONLY AND DOES NOT CONSTITUTE OR FORM PART OF ANY OFFER OF, OR THE SOLICITATION OF AN OFFER TO ACQUIRE OR DISPOSE OF SECURITIES IN ANY JURISDICTION, INCLUDING IN OR INTO THE UNITED STATES, CANADA, JAPAN OR AUSTRALIA.
 
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.
Important notice
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.
read previous read next