The value of MLP group’s investment properties rose 31 pct, to more than PLN 4.4 bln (EUR 945 mln). Consolidated revenue improved 39 pct y-o-y, to PLN 279.1 mln (EUR 59.5 mln), driven by an increase in leased area combined with higher rental rates. Last year, MLP group earned PLN 422.4 mln (EUR 90.1 mln) in net profit.
MLP group is developing its operations in Poland, Germany, Austria and Romania. The group’s existing portfolio comprises 21 logistics parks. Its strategic goal remains to expand the warehouse portfolio by developing big-box facilities and urban logistics projects.
In 2022, MLP group signed leases for 235,000 sqm of space. New completions with a total area of 226,000 sqm were located mainly in Poland and Germany. At the end of last year, the group had a total of 1 mln sqm of built space, with a further 119,000 sqm under development or in the pipeline. Development potential of the group’s existing landbank is close to 1.8 mln sqm. In addition, the group has reservation agreements to purchase new plots with an area of some 200 hectares, allowing it to develop another 1 mln or so sqm of new space.
High occupier demand for warehouse space across all markets where MLP group operates is driven mainly by the trend of near-shoring, continuing e-commerce demand and restructuring of supply chains. Other key drivers of demand for logistic space include low availability of vacant space and no signs that supply and demand will come into an equilibrium in the short term. Rents are likely to continue the growth course.
We continue to see robust occupier demand combined with market vacancies close to historic lows in supply-constrained markets. We expect this contrast between positive demand and limited supply to drive further growth in rental levels. In 2022, we have leased 235,000 sqm. Our total portfolio reached 1,064 mln sqm with 98 pct occupancy across all our assets and new space under development amounts to 119,000 sqm. In 2022, we successfully continued our efforts to diversify our assets, tenants and geographies. Further development on the German market is a key point of our strategy.
Radosław T. Krochta, President & CEO of MLP Group
The group intends to continue its strong development in Germany. It plans to strengthen and expand its presence in new key locations, but also in the regions it already is present, i.e. the Ruhr area, Brandenburg and Hessen land. It also expects to strengthen its foothold on the Austrian market and is looking to enter the Benelux countries soon. The Polish market remains crucial and MLP group will continuously increase offer in key logistics regions. According to the strategy, capital expenditure (CAPEX) in 2023 will amount to about EUR 215 mln, of which about 30 pct will be allocated to purchase of new plots. This year the level of commercialisation is planned to go up by about 20 pct.
In 2023, we launch new projects in Germany, Austria and Romania, but we are not slowing down our development in Poland. Tenants from the light industry and logistics sector were the largest tenants of our space in 2022. We expect this trend to continue – tenants from the light manufacturing and nearshoring sector will be the main source of lease agreements in 2023.
Radosław T. Krochta
Considering the current geopolitical situation and high volatility in the economy, MLP Group is well prepared for the current challenges. Proceeds of the latest share issue amounted to PLN 183.5 mln.
100 pct lease agreements indexed with CPI for EUR without any cap (indexed once a year in February). All rentals are denominated in EUR or are directly expressed in EUR, which significantly reduces our exposure to the currency risk. MLP group has a very good financial standing and a safe capital structure enabling the implementation of long-term strategic goals. With the modest leverage (LTV at 33.1 pct), long-average debt maturity of 5.1 years, no near-term refinancing requirements and virtually entire debt at fixed or capped rates, we have significant financial flexibility to continue to invest capital in the development and acquisition opportunities that offer the most attractive risk-adjusted returns.
Radosław T. Krochta
In keeping with its build & hold strategy, MLP Group retains completed logistics parks in its portfolio and manages them.
