Annual report 2008 - Altarea Cogedim

one in Italy. These shopping centres, which were 97% let on
opening, generated value creation of €97 million in 2008
(average yield of 9%). Thanks to development projects
secured over the last few years being brought into service,
ALTAREA achieved further very strong cash flow growth in
2008 (+23% for shopping centres).
ALTAREA also invested a further €295 million in total in
shopping centres (6) in 2008 (shopping centres in operation
and development projects). The Group also secured eight
new development projects representing potential investment
of €416 million with a yield of over 9%.
ALTAREA’s value creation model therefore demonstrates its
relevance during a period of crisis, in which the automatic
impact of higher capitalisation rates can be partially offset
by dynamic management of the portfolio, as well as the
completion of new assets offering high yields.
1.4 Advance compliance with “SIIC 4“
requirements (7)
The merger of Altafinance into ALTAREA was the final stage
of the dissolution of the existing action in concert agreement
between ALTAREA’s main shareholders, allowing ALTAREA
to comply in advance with the final requirements relating to
SIIC tax status, the provisions of which (“SIIC 4“) stipulate
that no shareholder other than an SIIC may control more
than 60% of an SIIC’s share capital and voting rights either
alone or in concert.
As a result of the merger, approved at the Annual General
Meeting of 26 May 2008, legal control of ALTAREA is in
line with its economic control.
1.5 Outlook
The situation observed at the start of 2009 was paradoxical.
While consumer spending remained flat - due to the mixed
success of retailers’ ”winter sales” and a decline in the
number of visitors to shopping centres - sales of new homes
seemed to pick up, with commercial activities achieving a
return to growth.
Against this uncertain backdrop, ALTAREA’s recurring
operating profit should increase further thanks to the quality
and diversity of its portfolio, with three new shopping centres
brought into service already nearly 100% let.
In view of its liquidity position, ALTAREA is planning to
continue with its conventional strategy of creating cash flow
and value, mainly by developing new shopping centres. The
Group may also seize any opportunities arising from market
conditions. ALTAREA has set itself the target of maintaining
the current solidity of its balance sheet.
2. Shopping centre development
2.1 Summary
At 31 December 2008, the portfolio of shopping centres in operation represented a value of €2.3 billion including transfer duties, with annualised
rental income of €142 million. Current investment in shopping centre projects represents potential GLA of 705,600 m² and projected gross rental
income of €171 million.
Key figures for the asset base and project portfolio at 31 December 2008
12/31/2008 GLA in m² Current
gross rental
income
Appraisal
value
Provisional
gross rental
income
Total
Already
invested
Committed
investments
still to be
made
Net investment
Remaining
investments
not
committed
Yield
Shopping centres in operation 589,092 142.2 2,270.4 N/A N/A N/A N/A N/A N/A
Shopping centres under construction 131,200 N/A N/A 40.6 509.8 311.3 198.5 0.0 8.0%
Development projects and signed
development projects
574,400 N/A N/A 130.0 1,431.2 154.5 125.0 1,151.7 9.1%
Total assets 1,294,692 142.2 2,270.4 170.6 1,941.1 465.8 323.5 1,151.7 8.8%
(6) Group share
(7) This merger was the subject of an offer document (“note d’information“) approved by the AMF and registered under number E.08-0052 on 7 May 2008
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