Hello, and welcome to Gecina Quarter One 2023 Activity Conference Call. My name is Priscilla, and I'll be your coordinator for today's event. Please note this call is being recorded, and your lines will be on listen only. If you require assistance at any point, please press star zero and you'll be connected to an operator. I will now hand you over to your host, Mr. Samuel Henry-Diesbach. To begin today's conference, please go ahead, sir. Yes, good morning. Hello to everyone, and thank you for being with us online this morning, for this conference call related to our business activity in Q1 2023. I'm Samuel Henry-Diesbach, and I'm here with Beñat Ortega, CEO, and Nicolas Dutreuil, Deputy CEO in charge of finance. After a quick introduction by Beñat regarding our performance in this first quarter, Beñat, Nicolas, and I will be happy to answer the question you may have. I hand the floor to Mr. Ortega. Hi, everyone. Thank you for being with us this morning. Before we can answer to your questions, I would like to quickly comment our performance and achievements since the start of this year, 2023. As you may have seen already in the press release published yesterday, our performance has been particularly robust this quarter again and confirms the confidence we brought along our 2022 earnings published earlier in February. Once again, this quarter, it's clearly the performance we are able to deliver that may contrast with uncertainty that seems to worry stock markets nowadays. To us, this performance is only largely due to our strength, our portfolio, our balance sheets, and obviously, I must say, the know-how of our teams. All drivers for rental growth are positively oriented. All of them marked an acceleration against 2022. I'm referring to occupancy, re-letting spreads, indexation, and pipeline contribution to our rental growth. First, the acceleration of like-for-like growth that achieved 7.3% in Q1, and even nearing 8% in offices and 5% on resi. This acceleration, when compared to the 4.4% like-for-like rental growth posted in 2022, is clearly supported by operational performance from 2022 but also in 2023. These performance is driven by the portfolio that provides visibility and high capacity to perform in these locations. Reversionary potential remains strong. We've been able to capture a re-letting spread of 30% in Paris and 7% in average for our whole portfolio. In our residential business, we are improving our re-letting spreads, now reaching 11%. The contribution from indexation is 4.2% in our like-for-like in Q1, while it was 2.1% for the whole year 2022. Occupancy rates have increased by 280 bips in 12 months and even 340 bips for offices, reflecting clearly an active demand for Gecina's assets in our locations. Like-for-like performance in Q1 feeds our confidence for fiscal year 2023. Note, however, that the occupancy rates gradually improved during 2022, and particularly at the end of the year, meaning that the base effect is expected to mechanically decrease and ease over the second half of 2023. Year-on-year rental growth also strongly performed at almost 9% and even nearing 10%, thanks to the positive contribution of our pipeline by EUR 4 million, reflecting the impact of the deliveries of l'ife building at the end of 2022 and 157 Charles de Gaulle in Neuilly. Those assets are fully let. Offsetting Icône in Marbeuf and France, assets that were vacated in 2022 and so transferred into our pipeline, like we said during our earnings call in February. Our achievements are robust also. Year-to-date, EUR 147 million of assets have been sold or under preliminary agreements to date. These disposals have been achieved or secured with premiums over our last appraisal by more than 6%. 60% of these sales concerns residential assets, and nearly 75% are located outside Paris. Most of these disposals obviously are under preliminary agreements and have been very recently secured. They should be finalized in the coming weeks or months. It's also fair to insist as well on our robust debt structure that most of you have in mind already. As you know, in terms of sensitivity of the group's average cost of debt, Gecina's rates hedging policy stands out through the long maturity of it, our hedging instruments, seven years, making possible a sustainable to protect the average cost of debts. From 23 to 25, 90% of our debt is hedged on average against changes in the Euribor. More importantly, it seems important also to underline the fact that during the first quarter, the group has been able to further strengthen its liquidity position again. Nearly EUR 175 million of new credit lines have been set up. Good news also that we have included a new European bank in our pool with an average maturity of seven years. These new credit lines are renewing ahead of schedule, showing quite great confidence because EUR 130 million were maturing in 2024 and are based on equivalent financial conditions. As a consequence, we are able to comfortably reiterate our guidance for 2023, and the results published at the end of 2022 and the trends we are still observing during this first quarter reflects the very good rental market in which we are. This operational performance is being further strengthened by the gradual upturn in the taxation, the improvement of occupancy, but also the positive uplifting rents we are achieving through tenant rotation. The pipeline is positively contributing to our net rental income growth. It's expected to ramp up as the major buildings were delivered in 2022 and 2023 are fully let. Gecina's long-term debt maturity and active rate edging policy is enabling us to limit the impact of interest rates rise in 2023. We expect a net recurring income to reach EUR 5.80 to EUR 5.90 euro per share in 2023, meaning a growth between 4.3% and 6.1%. Thank you for listening that. Nicolas, Samuel and I are now available to answer your questions. Thank you, sir. Ladies and gentlemen, if you would like to ask a question or make a contribution on today's call, please press star one on your telephone keypad. We'll pause just for a moment to allow everyone an opportunity to signal for questions. We'll take our first question from Véronique Meertens from Kempen. Please go ahead. Your line is open. Hey. Good morning, all. Thank you for the presentation and congratulations on the solid operational results. Two questions from my side. Positive to see that you managed to secure some additional disposals already in the Q1. Interesting to see that mainly in the resi segment. Is that a segment where we could see more and curious to also hear your thoughts on that market at this point in time? Then secondly, on your reversionary potential, again, the 30% in Paris CBD, offset quite a bit by Two assets in Paris La Défense, I understand. What's your expectations for the rest of the year? More specifically, what you're currently seeing in La Défense for reversionary potential for this year. Thank you, Véronique, for your questions. I'll take those two. On disposals, as we said earlier, we have no specific need to dispose, but we said we would be opportunistic on our disposal strategy. We've seen some traction on that segment, and that's why we decided to dispose on assets on the resi side. It shows that we have a premium on our presence, which is a good news. We will continue to be opportunistic on that. We'll see what will happen on the next months. On reversion, obviously, you saw that we had a negative reversion on Paris La Défense. You know, it represents 3% to 4% of our portfolio. When we look at reversion, I think we need to look at it as a trend more than a pure quarter by quarter reversion. The ponderation of those deals are almost half of the deals we have achieved during this Q1. We see good trends still in Paris specifically. That reversion should grow. We will have to make those deals before claiming an higher reversion. Obviously, I think it's more the ponderation during this quarter that leads to that smaller amounts compared to last year. Okay. Thank you. That's very clear. What do you see in terms of incentive rates on new lettings? They are pretty flat. Okay. That's clear. Thank you very much. Thank you, Véronique. Thank you. We'll move on to our next participant, Florent from ODDO BHF. Please go ahead. Your line is open. Hi, Beñat, hi Nicolas, hi Samuel. Thanks for this short presentation. Maybe two questions for me. On your disposal, would it be possible maybe to give us more colors on who are the type of buyers? And do you see opportunistic buyers on your side? How do you classify today's a wait-and-see approach in the investment market? That would be my first question. My second question may be more on the leasing side. I think remembering that at the beginning of the year, you told us that you were maybe expected a double-digit uplift for 2023 in offices. Is it something that is still expected after this Q1, or maybe you have changed your mind? Thank you for your questions. Yeah, on disposal, I think, you know, like you saw quarter one figures on investment markets, maybe two trends. The first one is clearly globally for Paris region, a decrease, a significant decrease in the investment market, showing that the market has dried a lot. At the same time, a pretty decent investment volumes downtown Paris. Long-term equity players still at stake, smaller volumes. Obviously it's a more, you know, complex market to read. Again, we are opportunistic on our disposal strategy, so we are actively monitoring it, and we'll see what happens later. Yeah, long-term equity players most of the time. On the leasing side, yes, I think we have a drop in our reversion during this quarter, but we think we will grow that amount, like I said earlier. To what extent, you know, I'm always prudent in what I say, yes, the leasing trends are still favorable. Again, remember that 75% of our portfolio is in Paris, 85 if we include Boulogne and Neuilly. That's why I was saying on the medium term, the ponderation should improve our average reversion. Okay. Thank you. All right. Thank you. Once again, ladies and gentlemen, if you would like to ask a question, please press star one. We'll move on to our next participant, Allison Sun from Bank of America. Please go ahead. Your line is open. Hi. Good morning. Congratulations on this good result. Just one question from my side. It's more a big picture question. I just wonder if you can comment a little bit on the take-up or the investment sentiment you have seen in the first quarter of the general market because I know Gecina is still doing a good job, but based on some broker report, we're seeing a quite dramatic falling down in both the letting take-up and also the investment volume. Do you feel that's the sentiment right now? Thank you. Thank you, Allison. The, yeah, the sentiment on the broker side is not good as the volumes are lower, and they live on volume, not on stock. We were expecting a Gecina decrease in the big pictures of take-up as, like we said, 50% of the demand was concentrated on Paris, while it was only 10% of the available space. Mechanically, leasing volumes were expected, at least on our side, to decrease. The demand is still there. Companies are taking more time to decide, we still see a activity demand on where we are operating. Obviously, the sentiment is a more, a smaller leasing volume for the whole Paris region. I think like we said, there is a clear polarization of that market. I think same apply to the investment market, which is quiet, like I said, with volumes which are smaller, again, quite a diverse situations across the whole Paris region. So it's a more complex market to read, I think leasing demand is driving both take-up and investment volumes. Okay. Thank you. Yeah. Allison, maybe to add few things, few figures on, on the global market. Look at the available supply on the market for offices per areas, and you will see that in Paris city, the supply has even further decreased in Q1 versus end 2022 in the central location. It means that even if the take-up decreased, that's largely due partly to a lack of supply, and the supply is even decreasing further in the more central areas of the Paris region, so Paris city. As Beñat was saying, if you split the central and the, and the peripheral locations in terms of investments, you will see that figures are totally different, showing the polarization in the investment market as well. Thank you, Samuel. Thank you. We'll move on to our next participant, Jonathan Kownator from Goldman Sachs. Please go ahead. Your line is open. Good morning. Thank you for taking my question. Following up perhaps from the previous question, how can we think about the evaluation of your occupancy rate? I mean, obviously you've made great progress. You've highlighted in particular towards the end of last year. Were your main leading challenges at this stage? Do you think that occupancy rate will continue to go up, or is it going to stabilize? On the contrary, are you expecting being releases of space during 2023? Thank you. Hi, Jonathan. Thank you for the question. In terms of occupancy, yes, we have reached again historical high levels of occupancy. We are not expecting to further increase significantly. We don't see neither strong challenges that drive our occupancy rate significantly down. We more see a flattish occupancy during this year. Obviously it's not, you know, our target. We try to grow it, but we don't see materially it growing. Okay. Fair enough. For indexation, I assume it's going to continue growing a bit. Is that a fair assumption? Yeah. It's a complex calculation to see the impact on cash flow growth from indexation as we discussed a lot. But yeah. Indexation is flowing into our cash flow. And then we'd have to look at, you know, all the base effects because we are passing high indexation since the end of last year. And it will very much depend on how the inflation flows. But it looks like yes, inflation is still pretty high, in line also with interest rates, which are still pretty high. But we should see indexation for quite a while, yes. That's for the like-for-like. In addition to that, you know that the other driver we have on the top line is a development pipeline. As you've seen, it is contributing positively to our rent for Q1. Of course, as we said, it should continue on this trend for the future. Perfect. Thank you. Thank you. It appears there is no further questions at this time. I'd like to turn the conference back to the host for any additional or closing remarks. Thank you. Thank you for everything. As you know, all the team remains available if you have any follow-up questions coming in the days ahead. Enjoy the rest of your day and hopefully we're gonna meet soon and for next publication by the end of July. Have a good day. Bye. Thank you for joining today's call. You may now disconnect.