CEE Lucky quarter for Nepi

Investment & finance

16 November 2023

Opr./edited by JC

1 / 1

Nepi Rockcastle’s net operating income rose 23 pct in the first nine months of 2023 to EUR 365 million, versus the same period of 2022. The main drivers of the strong performance were a combination of tenant sales performance and the contribution of the acquisitions completed in 2022.

The three acquisitions made in 2022 – Forum Gdansk and Copernicus shopping centres in Poland and the 50 pct share of the Ploiesti Shopping City in Romania – contributed EUR 28 million to the NOI for 9M 2023. On a like-for-like basis, NOI increased by 14 pct in 9M 2023, driven by higher base rents, turnover rents and short-term income, as well as a better recovery of operating costs (93 pct in 9M 2023 versus 91 pct in the same period of 2022).

Tenant sales (LFL, excluding hypermarkets) were 14 pct higher in 9M 2023 versus the same period a year ago, fuelled almost equally by an increase in footfall (+6 pct LFL) and a rise in average spend per visit (+6 pct). Demand from both international and regional retailers for the Group’s properties remained very strong resulting in retail vacancy falling to 2.2 pct. Rent collection rate for the period reached 97 pct by mid-November.

We opened Promenada Craiova in southern Romania in October, the largest retail scheme launched in the entire CEE region in 2023. Promenada Craiova was the first development of the group where renewable energy production was integrated over the parking areas, supplying 70 pct of the energy needed by the shopping centre and its tenants. This project, together with the overall photovoltaic projects installed on the Romanian property portfolio, will ensure a 25-30 pct green energy consumption across these properties.
Rüdiger Dany, Nepi Rockcastle’s CEO

The Group has no debt maturing in 2023 and liquidity remains very strong with EUR 361 million in cash and EUR 620 million in available committed credit facilities as of 30 September 2023. Total footfall in the Q3 of 2023 has stabilised at slightly below the levels of 2019, after a surge in the first half of this year, almost fully recovering since the end of the pandemic. The LFL increase in footfall was 6.2 pct in the first nine months of 2023, relative to the comparative period of 2022.

In Q3 2023, the Group signed 348 new leases and lease renewals, for more than 64,600 sqm, of which 37 pct by gross lettable area are new leases (1.1 pct of total GLA). International tenants accounted for 49 pct of newly leased GLA.