Castellana Properties Socimi S A : returns to pre-pandemic levels and sees net profit hit EUR16.9 million

• The retail-focused fund returns to pre-pandemic levels across its 16 properties, with a total gross lettable area of 350,271 sqm and a gross asset value of circa EUR1 billion.

• Over the last 6 months Castellana Properties has achieved EUR23 million in EBITDA and EUR16.9 million in net profit.

• With key performance indicators returning to pre-pandemic levels and the business on a firmer footing, the value of the company's portfolio rose by 1.6% for the period of 1 April to 30 September 2021.

• Gross rental income (GRI) reached EUR29 million, exceeding pre-pandemic levels, with occupancy being maintained near full capacity at 97.1%.

Castellana Properties has published its half-yearly results for its financial year (April to March) which demonstrates that its business operations are well and truly rallying once again. From April to September, Castellana Properties registered EUR23 million in recurring EBITDA and EUR16.9 million in net profit.

Portfolio footfall and sales levels have also been moving in the right direction. In September, visitor levels were back at 97% of what they were in September 2019, with sales exceeding pre-pandemic levels. Both indicators have outperformed the sector benchmarks and offer a clear indication of the resilience of the portfolio.

On a year-on-year basis, taking a look at each sector, pet-related goods and DIY headed up the recovery between April and September, registering sharp upticks of 43.7% and 32.9% respectively, with groceries, sports and electronics following closely behind. It is also worth noting that leisure, F&B and fashion, three of the sectors hit hardest by the pandemic restrictions, are also starting to bounce back, up almost 40% in recent months.

These positive performances have allowed the company to return to pre-pandemic levels across its 16 properties, which offer a gross lettable area of 350,271 sqm and a gross value of EUR976 million. What's more, the publication of the latest half-yearly r have increased the portfolio value by 1.6%.

The sale of the two office buildings occupied by Konecta in Madrid and Seville in June for EUR26.5 million brought Castellana's Net Loan to Value down to 46.84% and further strengthened its already significant cash position. These sales generated a profit just short of EUR4 million and allowed the business to focus solely on retail, a sector which it believes holds great potential for growth in Spain.

Castellana Properties increases gross rental income by 5.7% versus pre-pandemic levels

After making a solid commitment to shore up long-term relations with its tenants during the previous financial year and signing temporary rental discounts as a result of the pandemic, the past six months saw the company book EUR29.4 million in gross rental income (GRI), up 97% Year on Year on a Like for Like basis. Excluding the rents corresponding to the office portfolio - sold in June - and the temporary rental discounts granted to tenants during this period to help with the adversities caused by the pandemic, this figure climbed by 5.7%.

The company's occupancy ratio now stands at over 97%, a level that is considered to be full occupancy in the sector. In addition, the rental collection for its properties stands at an impressive 95.6% - far higher than the sector average and testament to the exemplary work of the management team.

Over the past 6 months, Castellana Properties has signed 20,529 sqm of space across 94 lease agreements - 66 of which related to new signings and 28 to renewals - ensuring €4.5 million in net operating income (NOI). These signings have increased the average rent achieved for space previously let by the company by 1.35%.

Active portfolio management: at the heart of the company's strategy

Castellana Properties has almost completed its repositioning projects in Los Arcos (Seville), El Faro (Badajoz) and Bahía Sur (Cádiz), with all of the rent targeted for these projects now signed with tenants. With just a few units left to rent, the company is well on the way to exceeding the initial targets set and will be able to increase the GRI generated by these projects.

In April, Castellana Properties also acquired a four-floor office building with a GLA of over 4,600 sqm that adjoins the Los Arcos shopping centre. This space will be redesigned and refurbished to add a new leisure and dining area and welcome 12 new brands to the shopping centre. A total of EUR 15.6 million will be invested in this project.

Alfonso Brunet, CEO of Castellana Properties stated "we are extremely proud to announce these results which paint such a positive picture for the company. It's been a difficult time for everyone these past few months, but we can now announce that we have returned to pre-pandemic levels, paying testament once again to the strength of our portfolio and the resilience and potential of the sector, as evidenced by its rapid recovery. Following the recent sale of two office buildings, all of the properties owned by Castellana Properties are now retail assets, a move that further strengthens our commitment to the sector".