Finance Avenue- Cofinimmo
22 octobre 2011
Together
in real estate
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Cofinimmo in a nutshell
Leading Belgian listed real estate investment company exposed to the office property market in Brussels,
nursing homes in Belgium and France and pub properties in Belgium and the Netherlands
Total portfolio fair value of >€3 billion
SICAFI status in Belgium and SIIC status in France
Internal real estate management platform with 110 employees
Two longest shareholders (<5%) are Dexia Insurance and Allianz Belgium
Included in major indices: BEL20, EPRA Europe, GPR 250
Total market capitalisation at 30.06.2011: €1.5 billion
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Highly experienced senior management team
Serge Fautré, CEO since 2002, is Director of the Union Professionnelle du Secteur Immobilier (‘UPSI’)
and former Chairman of the European Public Real Estate Association (‘EPRA’).
Jean-Edouard Carbonnelle, CFO, has joined Cofinimmo in 1998 and is Chairman of the
EPRA Tax Committee.
Xavier Denis, COO, has joined Cofinimmo in 2002 and is in charge of the real estate operations of the
company. He is the Chairman of the Investors Committee of UPSI.
Françoise Roels, Secretary General and Group Counsel, joined Cofinimmo in 2004 and is in charge of
corporate governance matters. She is an independent Board member of “Women on Board”.
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Track record in the Belgian property market for >25 years
Listed on Brussels
Stock Exchange
1983
Established with
€6M capital
Internalisation of
property management
platform
1994
1996
1999
SICAFI status adopted
Expansion into
the nursing home
segment
2000–2001
Establishment in France in
the healthcare sector
2005
2007
2008
Partnership with
AB InBev regarding
pub portfolio
Primaedis SA acquisition
of office portfolio
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2010-2011
Reinforcement of the
position of leading
investment company in
nursing homes on the
European continent
Investment strategy
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Key operational indicators
30.06.2011
31.12.2010
3,157.6
11.4
3,041.9
11.5
6.3
6.7
Occupancy rate - Total portfolio (%)
95.20
95.77
Occupancy rate - Office portfolio (%)
91.66
92.85
Portfolio of investment properties - Fair value (x €1,000,000)
Residual lease term in years - Total portfolio (years)
Residual lease term in years - Office portfolio (years)
Acquisitions (€142.0 million)
Disposals (€41.1 million)
4,2 0,3
29,9
3,4
Offices
Offices
Nursing homes
112,2
Constructions/renovations (€20.4 million)
4
0,6
Offices
Nursing homes
Nursing homes
Pubstone
Pubstone
Other
36,6
Realised gain on disposal of buildings: €5.0 million, i.e. €0.33 per share
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12,4
Global portfolio – Portfolio spread
Portfolio mix by segment
Portfolio mix by country
30.06.2011
30.06.2011
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Long term quality leases
Lease maturity by property type (years)
Public sector contribution: 18% of total revenues
30.06.2011
30.06.2011
Activity sector
(305 clients)
Contractual
revenues
(% of total)
Lease length until
first break (years)
AB InBev Group
13.2%
19.3
Belgian public sector
11.4%
13.3
Korian
8.7%
8.4
Armonea
6.4%
22.9
6.1%
6.3
Top 5 clients
45.8%
14.5
Others
54.2%
8.8
Total
100.0%
11.4
Int’l public sector
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Cofinimmo’s role in healthcare real estate
Each party does what it does best:
Cofinimmo builds/finances/maintains the facility, the healthcare operator provides care and accommodation
Expand major experience of complex office management to other sectors in need for multifaceted expertise
Diversify within segment: by country, social security system, operation type, operator, location
Long-term partnership: Cofinimmo signs long-term leases and can commit to carry maintenance
(structure of buildings, HVAC, equipment, …)
Support the operators’ growth: finance, develop and build extensions to the existing buildings, carry out renovations,
reposition existing facilities
Contribution to sustainable development in this particular segment
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Cofinimmo Healthcare Portfolio characteristics
117 nursing homes/clinics with 12,284 beds in Belgium and France
Long-term contractual relationships
• 27 years in Belgium
• 12 years in France
Fixed rents from operator indexed annually
No risk relating to the management of the care homes
Mostly triple net leases or limited maintenance obligation
Credit risk on operator group, not on individual unit
In-house Project Management Department specialised in this segment
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Cofinimmo Healthcare Portfolio mix
Well-spread portfolio managed by first-rate operators
30.06.2011
30.06.2011
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Cofinimmo Healthcare Portfolio mix
Cofinimmo operators-partners
Belgium
France
Armonea
• Armonea (4,500 residents) is a joint venture of 2
family-owned companies with more than 30 years
of experience in the nursing home sector.
Calidus
• Calidus is an initiative of several independent
nursing home operators, aimed to centralize and
share support services.
Médibelge
• Médibelge (1,800 residents) is a private nursing
home operator owned for 49% by Orpéa.
Senior Assist
• Senior Assist (2,500 residents) is an
entrepreneurial group.
Senior Living Group
• Senior Living Group (3,750 residents) was created
in 2004 by Waterland Private Equity.
Le Noble Age
• Belgian subsidiary (507 residents) of Le Noble
Age, a French listed operator (5,107 beds)
Orpéa
• Orpéa is the largest player in senior care in
continental Europe, and is listed on the Paris
Stock Exchange. The company manages a
network of 33,000 beds.
Korian
• Korian is the second largest nursing home
operator in continental Europe, with over
21,400 beds. The company is also listed on the
Paris Stock Exchange.
Medica Group
• Medica Group is the fourth largest nursing
home operator in France and is listed on the
Paris Stock Exchange. The company manages
a network of 14,300 beds.
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Key Features of the Healthcare sector
Healthcare segment
Demographic trends (Example: Belgium)
o Increase in life expectancy: 2007=83 (♀) and 77 (♂) – 2060=91 (♀) and 83
(♂)
o Faster rise in numbers of 60+ and 80+ aged persons;
growth perspective for 2050: +60% and 150% respectively
o Dependency comes at later age
o Increasing dependency rate (% of total population) due to aging but also
disintegration of the family unit
Elderly care needs
Demographic trends (Example: Belgium)
Elderly care needs
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Source: Ageing Working Group/European Commission
Demand Potential in Healthcare sector
Focus on Belgium, Demand potential
Needed capacity in 2050:
• Bureau du Plan: + 180.000 beds
• FOD Economie: + 74.000 beds
280%
Projections for capacity needs in Residential Care
260%
240%
220%
total population growth
growth population over 80
200%
forecast capacity needs by Bureau du Plan
forecast capacity needs by FOD Economie
Compensating factors :
• Healthy life expectancy (+0.3 years per year 9501)
• Policies towards elderly and healthcare
spending
• Consumption patterns of elderly
180%
160%
140%
120%
100%
80%
2007
2020
2040
2060
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Obligations and recommendations for Nursing Homes
Nursing homes – obligations (BE)
Accommodation
o Minimal room surface depending on Region
o Additional equipment & services (living areas, sanitary,
comfort, …) regulated by Region
o Single/double room ratio to be respected
Building permits & environmental regulations
o Building permits to be delivered by local
Administration
o Environmental permit to be delivered by the
municipality (classified installations), mostly limited
validity in time
o Soil pollution: certification of soil condition at
acquisition of land or building
Staffing
o Depending on degree of care: 0.3-0.4 Full Time
Equivalent (FTE)/resident
Energy Performance of Buildings (EPB)-prescriptions
o Regional specifications in accordance with EU
Directive
o Currently limited to insulation performances for
nursing houses
o Minimal energy performance for service flats
o European tendency versus energy neutral buildings
in 2020
Fire security
o Federal rules regarding fire safety of all buildings
o Regional rules by Health Care Administrations for
nursing homes and service flats
o Project approval and operational inspection by
local Fire Department
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Obligations and recommendations for Nursing Homes
Nursing homes – recommendations
Building program
o 20-30 beds per floor = efficient care unit
o Minimum 80-120 beds per nursing home
o Organisation in living groups leading to horizontal
facilities
o Tendency towards mainly single bedrooms
(# of double bedrooms limited by regional prescriptions)
o Tendency towards homes with mixture of nursing
homes & service flats, possible extended with day
centre or home care services
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Recent Acquisitions in Nursing Homes
France
Operator: Medica
Operator: Senior Assist
Belgium
De Nieuwe Seigneurie, Rumbeke – 3,460m² – 75 beds – €7.4 million
5 EHPAD, 1 SSR – 21,653m² – 475 beds – €44.5 million
Operator: SLG
Saint-Charles, Bouillon – Le Chenoy, Ottignies – Le Grand Cerf, Spa – 9,300m² – 238 beds – €10.3 million
Bethanie, Namur – Ten Prins, Brussels – Le Progrès, La Louvière – Paloke, Brussels – De Nootelaer, Keerbergen – 25,764m² – 592 beds – €47.0 million
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Recent Transformation
Bellevue, Brussels: Transformation of 2 office buildings into a nursing home with 143 rooms
2 buildings: 3,056m² and 4,597m²
Mission Cofinimmo: full Project Management
Construction of a 1,000m² underground parking lot with 35 places
Creation of a garden in between the 2 buildings on top of the parking
Cost of works: €9,500,000
Delivery in January 2010
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Recent New Construction
Weverbos, Gentbrugge: Construction of a new nursing home for 100 residents
Total surface superstructure: 5,387m²
Mission Cofinimmo: full Project Management & Development
Optimisation of the operator’s project; construction next to the existing nursing home (instead of on top of
it)
Negotiation of the urban regulations & building program
Cost of works: €12,900,000
Delivery in June 2011
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Conclusion
Cofinimmo - Investment Rationale in Healthcare Sector
Significant potential due to demographic trends
Strict authorisation and accreditation system of lessees/operators constitute a high entry barrier
Revenues of the operators guaranteed by Social Security: 50% in Belgium and up to 30% in France
Attractive residual value and redevelopment potential
Some units are post-acute care or psychiatric facilities
Cofinimmo is European leader in the nursing homes real estate market
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Disclaimer:
This presentation is directed to financial analysts and institutional investors and is not to be considered as an incentive to invest or
as an offer to acquire Cofinimmo shares. The information herein is extracted from Cofinimmo annual and half-yearly reports and press releases
but does not reproduce the whole content of these documents. Only the French annual and half-yearly reports and press releases form legal
evidence.
Together
in real estate
For more information contact:
Valérie Kibieta
Tel.: +32 2 373 60 36
vkibieta@cofinimmo.be
www.cofinimmo.com
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