Good day and welcome to today's Gecina 2022 full year earnings conference call. This meeting is being recorded. At this time, I'd like to hand the call over to Beñat Ortega, CEO. Please go ahead. Hello, good morning, everyone. Thank you for attending today to this 2022 earnings presentation out at our head office, even if we have strike today in Paris, or using the webcast for this 2022 earnings. I'm very pleased to talk to you after almost 10 months as a CEO. It's a great opportunity to look at everything we've been able to achieve this year. We have been very active, both on operations and the balance sheet. Our performance over 2022 has been strong as we have been able to capture the benefits from supporting leasing markets. Our strategy based on centrality and proactive CSR bring therefore confidence for the coming year. Maybe it's to start with KPIs. We have been able to lease 100,000 sq m let, relet or renewed in 2022, bringing an average positive reversion of 24% and increased our occupancy by 210 basis points in offices, especially during H2. A consequence, growth rates are up by 4.4% on a like-for-like basis versus 3% in H1. Our recurring net result is up by 4.5% as we have also improved our cost base in 2022. This is an achievement in an inflationary environment. NTA is down 2.3%, reflecting the impact of cap rate increase, largely offset by a positive rental effect. NDV is up by 6% in 12 months. This is the result of our unique hedging policy. Hedging and liquidity position we have been improved by renewing or raising EUR 2.5 billion of debt in 2022. We will propose during the next AGM that our EUR 5.3 per share dividend for 2022 will be paid fully in cash in 2023. Finally, our recurring net result guidance for 2023 is planned to be between EUR 5.8 and EUR 5.9 per share and ends of 4%-6% growth. Let's move now to a quick dive into our achievement on offices and resi markets. Regarding offices in 2022, as I said, we have signed 100,000 new leases, sq m of new leases in our office portfolio. 75% of those leases are related to renewals or relettings with a 24% uplift in rents. 15% of those leases have been signed on vacant assets, therefore supporting occupancy rate increase. Almost 10% on assets under development, projects delivered in 2022 or to be delivered in 2023 are now fully let or pre-let. Clearly, we have accelerated in H2, both on reversion and occupancy, thanks to those high leasing volumes mentioned earlier. The momentum gradually improved along the year. Uplift captured is now at 24% for the whole year, but was 13% in H1. Occupancy rate at end of 2022 is 100 basis points above its level at the end of H1. As an evidence of solid achievement from Gecina's team and hard work, transaction have beaten new records along the year. In the early 2022, several leases on prime assets in the CBD were signed above EUR 900 per sq m, setting the references for the prime rents at that time. Mid-year, we moved up prime rents around EUR 950, and later in H2, around EUR 1,000. This increase in prime rents is particularly interesting when considering reversionary potential, since our track record moved up quicker than indexation in central location, creating a gap with the leases that we have signed some years ago. This very favorable context is supported by a solid market momentum, still driven by the evidence of market polarization in favor of central location. In Paris city, for example, take-up grew quicker than in the rest of Paris region. If you combine this strong take-up with the available supply that is decreasing, vacancy is close to all-times low. Another way to illustrate this polarization is to look at the theoretical timeframe to absorb vacant stock. Not only this absorption rate pace is faster in Paris, Neuilly and Boulogne, 85% of Gecina's portfolio, than in other places of Paris region, but also this timeframe decreased in these locations these past three years while it was growing in other locations. Polarization is thus gradually increasing. On resi, clearly our operational performance came as well in 2022. We have improved dramatically our teams, our processes. As a consequence, rental reversion captured in 2022 has reached 10%. This must be compared to 1.9% in average from 2014 to 2017, and 6.4% in 2018 to 2021. Our resi business offers new business opportunities for the years ahead that we have just started to investigate in 2022. We plan to better operate resi with our YouFirst brand. With more services and new high-end clientele, our buildings will be more hybrid, like mixing student and young adults, for example, to deliver better growth in occupancy and net rents. If we continue on our operational performance, in 2022 again, KPIs have been positively oriented on energy consumption and CO2 emissions, respectively decreasing by 6% and 18% in one year on our office portfolio. Certification rate also grew up to 87% and importantly, 100% of our assets under development are targeting the best levels of certifications regarding energy, but also biodiversity, connectivity, and well-being. You know, our ESG ambition is part of Gecina's DNA. We can do more without CapEx. Doing so requires on live and real data. Our buildings have been equipped with CO2 and temperature sensors in 2022 to pilot more efficiently our buildings. 100% of our office assets are now equipped. For example, already 2,300 sensors have been installed in our residential portfolio. Once implemented, we can now interact more efficiently with tenants on real-time and closely monitor actions to save savings and closely monitor our suppliers also. In this context, we have launched an ambitious plan earlier this year with actions to be implemented in all our buildings. Additionally, we target to fully review in 2023, 1 building per week. We have dedicated a full team, including some suppliers, to review those assets. The plan based on the first results we have achieved in 2022, for the first ones, is to achieve 20% energy decrease without CapEx after those in-depth asset reviews. In 2022, thanks to the operational achievements mentioned before, all cash flow drivers have been positively oriented for Gecina. We have clearly accelerated on like-for-like rental growth, indexation, occupancy rate, reversionary every quarter in 2022, and especially in H2. Like-for-like rents are therefore 4.4% up at the end of 2022, while it was 3% in H1 and -0.4% in 2021. We can be confident that 2023 to follow this improving trend. When looking at each component of our like-for-like rental growth, indexation contributes to, let's say, only 2.1% in 2022. The impact has been gradually increasing quarter after quarter, there is still room to improve, obviously, since the last index for ILAT, so the office index in France, is at 5.9%. Bear in mind that the last index for resi in France is at 3.5%. Occupancy rate increase also contributes to our like-for-like growth for 1.8% in 2022. Clearly, occupancy rate increased in 22 almost 200 basis points in all our businesses. We have a positive momentum in rental markets, but we have also quicker processes for letting, supported by digital. Note as well that assets delivered in 21 and 22 have been largely let now, and this improvement in occupancy rate should positively contribute to our like-for-like growth in 23. Reversion contributes to like-for-like growth for 0.5% in 22. As I said, both offices and resi uplifts are very sound. On top of the like-for-like rental growth, the pipeline contributed positively to the rental income growth in 22. A net of rental loss for assets transferred to pipeline, the net contribution from our pipeline came at plus EUR 5 million. Bear in mind in that figure that L1VE asset was delivered in H2 and will have a stronger impact, obviously, in 2023. As you all know, Gecina has been particularly active in terms of disposals between 2018 and 2021, with EUR 3.2 billion of assets sold since then, following the acquisition of Eurosic, and that have contributed to the relatively low LTV that we are benefiting of today. The consequence is, however, that our 2022 earnings were cut from some rents linked to these disposals, around half a billion EUR in 2021. If we exclude the impact of this disposal achieved in 2021, the remaining earning dynamics is particularly strong as shown on that chart. It would approach EUR 33 million earning gain, so almost EUR 0.5 per share in 1 year only, driven by like-for-like contribution, the pipeline, but also very controlled cost base that we have decreased by EUR 6 million despite inflation and a stable cost of debt. Let's turn now on capital value. Contrary to leasing markets, investment markets have been a bit more quiet in 2022, especially in H2. Important to note, however, that Paris city has been okay, especially recently, small assets. I would like to highlight that 70% of our assets within our portfolio in Paris are composed by assets below EUR 100 million. This gathered more than 100 assets, both in offices and resi. In this context, portfolio valuation are slightly down in 2022. cap rates have moved upwards by 30 basis points in average, leading to a negative effect of 5%. On the other hand, positive rental effect logically came to partially offset this. 6% in Paris, 4.2% in Neuilly and Boulogne, but negative for all the locations like La Défense, as you can see on the slide. NT is down therefore moderately by 2.3% to EUR 172 per share. Even if like-for-like portfolio is down, Gecina has created value on the pipeline. Note as well that the rise in interest, therefore, NAV NDV, so the liquidity value of the company is up by 6% to EUR 183.8 per share, driven by a EUR 14 revaluation per share coming from the mark to market of our debt and financial instruments. This last point means that debt management is becoming crucial asset for a company. During 2022, while debt markets were quite complex to read, we have even improved our positions on that front. Indeed, we have been able to raise EUR 750 million of new unsecured debt at an average fixed cost of 1.36% in average for 11 years maturities. Through a bond issued in January, good momentum, but also two hybrid solutions with swaps in August 2022, when the markets were favorable, and private taps on our existing bonds in December and January 2023. I'm pretty sure only very few players in the sector have been able and have the capacity and the opportunity to raise such new debts at these conditions in 2022. New bonds, also credit lines. Since the beginning of the year, Gecina secured EUR 1.8 billion of new undrawn credit lines. We have decided to anticipate the renewal of our credit lines expiring in the coming years and have achieved to secure them for 7 years in average at equivalent terms. Our liquidity position is particularly strong, as you can see in the slide. Short-term and mid-term, 90% of our financial expenses are hedged at excellent conditions for 2023 to 2025. Note as well, and I think that's unique, that 50% of our bonds are expiring after 2030. Quick dive into our pipeline. Strong activity in 2022. Maybe I can highlight the 157 Charles de Gaulle building in Neuilly, fully let slightly below EUR 700 per sq m. This is significantly higher than previous prime rents in that location and our expectations. l1ve, that was delivered in H2, with more than 33,000 sq m let, pre-let by the way, to BCG, Roland Walters, Robert Walters, and a group within the luxury industry. This asset will therefore contribute to future rental growth in 2023 as it was delivered late in the year. We mentioned in the H1 results that we had launched in Paris CBD a new project, 13,000 sq m asset refurbishment program, 32 Marbeuf, now called Icône. Construction cost has been fully secured now, below the expected cost, thanks to an excellent collaboration with the construction company. The asset will be delivered in 2025, and we target an uplift of 60% in rent versus the previous tenants. 2023, we'll be active again in terms of contribution from the pipeline with deliveries of four new projects, both in offices and in residential, bringing on an annual basis, so not pro rata next year, EUR 15 million with a limited amount of CapEx to be spent on those projects, EUR 63 million. If we look a bit longer term or mid-term, between 2023 and 2025, the committed pipeline could generate additional rents around EUR 80 million while requiring a bit less than EUR 500 million additional CapEx with a good ROI, but also an excellent return on the new CapEx. To conclude this presentation, we can summarize 2022 saying that, 1, operational performance has been robust on all KPIs, with H2 being even better than H1. 2, this should help, obviously, for all the reasons mentioned earlier, our performance for 2023. Three, although we are not immune totally, our proactive debt management built in 2022 and in the previous years is proving to be efficient and provides visibility for 2023. Four, pipeline is set to contribute further to our rental growth in 2023 onwards. In that context, pretty complex and calling for caution, but given the visibility provided by our portfolio, our achievements and our balance sheet, we are confident that recurring net income per share should reach the range of EUR 5.80-EUR 5.90 per share in 2023. Growing by between 4.3%-6.1% versus 2022. This concludes our presentation, and we are Nicolas, Samuel, and I now happy to answer the questions you may have. We have a first question from Florent. Yes. Hello. Good morning. Florent J oubert from ODDO BHF. Thank you very much for this presentation. I would have 3 questions, if I may. First on the leasing side. If we assume similar conditions in 2023 than in 2022, what could we expect in terms of leasing volume or maybe reversion also? You have a very strong reversion in 2022 and also maybe in terms of evolution of occupancy rate. That would be my first question. Second question, you provide some visibility on the cost of debt. Would it be possible maybe to have a further view on what could be the cost of debt for 2022 and 2024? Maybe the third question on appraisals. We are in a wait and see mode today. What should we be confident on this valuation? Were you ready to buy assets at these levels and in which locations? Thank you. Thank you. Maybe on leasing, I think we can have volatility on the volume, so I will not that much comment on volume. I think reversion is planned to be pretty okay. We'll see if we can achieve the results of this year. I think we still have room for maneuver on reversion next year and same on occupancy. Historically, we have decreased occupancy in 21, and I think we are hitching up. Have in mind that the spot vacancy rate is around 95% at the end of this year, but there is volatility during the year, but I think we can improve a bit occupancy. Reversion, I think we will be double digit, obviously, we hope. Occupancy, same, a bit better. On cost of debt, I think we have a slide on that. We are very much covered. 90% of the debt is covered. Therefore we have just a risk on the remaining on, and it depends on the curve. I will let you do the calculation. Which is not very complicated to do, in fact, because you know that we have secured 90% at 1.2. You can make the assumptions on the 10% remaining, and you should get a number. Of course it should increase a little bit. As you've seen, what we've done during the year, we have continued to secure low interest rates on origins. Of course we will not get the full impact of today's market condition in the coming years. On appraisal, wait and see. I think we have done the job on appraisals. If we just take the example of La Défense, which is a small portion of our portfolio, but the You know that La Défense is pushing a lot our earnings because we have let very recently our assets and you see that we are posting a negative evolution of that portfolio. I think the fact that, you know, liquidity is still pretty there on small assets in Paris Prime. Like I mentioned, a large portion of our portfolio there is composed by those assets. I think we have done the job. It's pretty flat, like you see, because we have rental growth. I think we have done the job and the appraisals have done the job on the cap rate expansion in all. And looking, you know, quite wide the variety of our portfolio. When you look at, you know, each of the locations, I think we have done the job very seriously. When it relates to acquisition, I think it's time for agility. We'll see how the market evolves and if we see a qualitative asset to improve our portfolio and our earning trajectory. No, nothing specific to comment on that. Okay. Agility. Yes, we do. Lisa. Good morning. Peter Papadakos, Green Street. Two questions, maybe one on the 24% reversion. Is it somehow possible to give us a range of what the reversion would be on an IFRS basis rather than potentially on a headline versus passing or without CapEx, significant CapEx being spent? I guess I'm just trying to get to a more like a like-for-like reversion as opposed to obviously you're doing asset management and you're achieving 24%. It will be better for us to understand a little bit of that dynamic. That's one question. The second question is a little bit on the residential growth. On the first of October 2020, there was a press release about a joint co-development company. You were gonna sort of deliver 4,000 units over the next 4 years. With 18 months to go, can you give us an update on how many you've delivered and what's the update on that front? Thank you. On reversion, I think when you look at some transaction that we have signed, for example, in Lisbon, we have just renewed or relet the asset without any CapEx. We can achieve. Just because of, you know, like we commented, prime rents have grown faster than indexation. Naturally, when the assets are well located and of good quality, we can deliver a significant reversion. I would say it has not been pumped by CapEx, that reversion. As you know that, you know, we have a pipeline, it's more, well, like I said on Marbeuf to get 50%, 60% reversion. I would say that the like-for-like business is pretty sound where we operate. It's lower obviously outside Paris, that's why we are that average. I would say that, you know, it's not specifically deployed by CapEx. On incentives, it's pretty stable in Paris, pretty higher as well. It depends on, you know, the momentum, the lease you sign, the average. I would say that it's not that much influenced by those two elements. It's really that, you know, vacancy is low and we have a better bargaining power, and we are, you know, quite demanding. I think, you know, what we have tried to prove also there is that each time, because we have a good product, but also because we have, you know, quite active leasing teams, because we have a spread over the business that allows us to know all the opportunities. The beauty of having so many assets is that there is no tenant looking for sq m that we don't know is looking for sq m. That gives a bit an advantage towards some of our peers and to push the rents up. That's first questions. On the resi growth, I think, you know, and you might know that the context in terms of, you know, price of cost of debt has changed a bit. I think expansion plans, that's why I was not commenting that much on acquisitions. I think we are careful on managing our balance sheet. 2022 has been very much on that. We are happy where we are, but we are careful. That's why I think that partnership has not grown that much. You know, building 4,000 units just on one partnership needs a lot of capital, and it doesn't look that interesting. Over the period anyway, we have secured around 1,000 units, not only with Nexity, but other players. It's around a half a billion EUR, right, investment case. A little bit less. A bit less, with EUR 300 million, EUR 200 million-EUR 300 million to still be spent. Maybe if I can just add something regarding the partnership. In fact, it was a not a commitment to buy for us or to sell or to produce for Nexity, meaning that it was of course depending on the agreement we can reach operation by operation. We have a question on the phone. Ladies and gentlemen, if you wish to ask a question over the phone, please signal by pressing star one. We have a question over the phone from Bruno Duclos from Invest Securities. Please go ahead. Hello. Thank you for the presentation. My first question is, well, there's currently an ongoing review of the Paris urbanistic plan with some offices which could be impacted by change in their use. Are your assets impacted by this review of the urbanistic plan? More generally, what impact do you see for the market? Yeah, the Paris city is reviewing its urbanistic plan. We are following that precisely. Bear in mind that we at Gecina have both offices and resi, and we have an ambitious, you know, ESG strategy. I think when we look at the key highlights of the plan, it's pretty in line with our strategy. I think we need to assess which assets, what we should do with it, how profitable it is. We don't see any major issue. When you look at, you know, typically Marbeuf, we had no specific issue to get the building permit on that asset. It's always a discussion. It takes some time. That's somehow a protection for REITs like us, which have invested on a regular basis in the assets. We have no massive need to go to get building permits. We are quite agile on the way we manage building authorizations. For the timing, we are closely looking at it. For the impact on the market, I think the market's still waiting for the end results. We will see. I think it means those plans that are more demanding towards investors means also that you need more professionalism and a lot of expertise, in fact, to develop assets within the capital city. I think, all in all, a company like us should benefit from that situation, especially those that are capable to manage both office and resi. Be profitable if you are replacing some office spaces by residential, given the difference of price per sq m for these assets? Yeah, yeah. 2 stuff. Yes, we are transforming offices into resi. You know that we launched a year ago, I think Rue d'Arcole on the 14th small and assets transformed from offices to resi. I think in a certain number of situation, you can make a profitable project of it if you can build more, for example. That's one. Yes, we do, but when it's profitable. Second, you know, in Paris, we have some assets which are already hybrid. I have in mind Avenue de l'Opera, the 35, where we have like 3 or 4 floors of offices and 2 floors of resi. This is something anyway that which is manageable. Bear in mind that, you know, that transformation from office to resi becomes compulsory when you go for building permit on specific plots and specific areas. It's anyway not spread over all type of properties. Maybe, could you provide us with an update on the, the work from home issue? Have you seen some companies renewing their leases with smaller surfaces? According to you, what is the new standard in terms of work from home for the Paris market? The two or three topics within it. Today, when we look at, you know, the days taken by employees, we are in the range of 1 to 1.5 days a week. The agreements built by the companies are more in the range from 2 to 2.5. Actually, people are taking less, at least in Paris, less days than what they are allowed to. Because they like, you know, we are somehow social animals, and they like to gather. Second, yes, we see less parameters taken by companies in general. When they decide to move, they take, I don't know, 20% maybe or a bit more surface than before. Third, and that's the consequence, it means that it makes some savings for them. For that time being, and because they have the need to bring back the people to the office, they have difficulties to recruit. Most of the time, they try to take better offices. They take green offices with biodiversities or greenery. They try to get more meeting rooms, more collaborative places, and this is what we produce at Gecina. I think part of the reasons why we have achieved a reversion, is because people are taking less parameters but better parameters. Thank you. Our next question comes from Allison Sun from Bank of America. Please go ahead. Hi, good morning. One question. Do you expect in 2023 your disposal volume, how does that compare with 2022? I try to figure out in your guidance that your earnings will be between EUR 5.8- EUR 5.9, and how much in that is reflecting the rental loss from the disposal you will have in 2022 and 2023. Thank you. Within the guidance, we have planned some disposals. We don't communicate the exact decomposition of our growth. We have planned some disposals, obviously. Like I said, we'll be agile both in acquisition disposals. When we, when we look at, you know, the impact of on our earnings is pretty limited. Rather neutral. Thank you. We'll now move to our next question from Jaime Escribano from Morgan Stanley. Good morning. I would like to ask you about the level of incentives. Whether you could provide a little bit more color on that? Market reports suggest that incentives in Central Paris are up to 15%-16% and above 30% in La Défense. Whether you are seeing, you know, that level in your recent lease-ins and especially in your future pipeline prelets? Thank you. The incentives, first La Défense, typically, they were signed, what, two years ago. It was secured during COVID times and before the current period. I think the teams have done a fantastic job to secure them before it started to be a bit more complex. We have never, and, I agree there, but I think we have never signed 40%-45% lease incentives at Gecina, even in those locations. We have just renewed leases with lower than 30% incentives, even on those Defense and Peri-Defense locations. Within Paris, we are more in the range of 15%. The incentives are pretty stable in Paris. Thank you. Thank you. As a reminder, to ask a question, please signal by pressing star one. There are currently no further questions over the phone. Okay. I think we have no questions on the line. Okay. Thank you very much for attending today. Thank you for your questions and see you soon. Bye-bye. Thank you. Bye.