Working together with tenants, contract retention, and leverage management: keys to the vehicle’s stability
- Commercial management enabled a 92% contract retention rate, with more than 61,000 m2 retained and more than 6,000 square meters leased in previously available spaces.
- Physical vacancy stood at 8.9% and economic vacancy at 10.3%, on a year-to-date average basis.
- The debt-to-assets ratio stood at 30%, with 11% in short-term debt and the remaining 89% in long-term obligations.
- The average daily trading volume of TEIS so far this year was COP 2,196 million.
- The first quarterly returns payment, worth COP 12,594 million, will be made on November 17.
- The vehicle is preparing for its third ordinary bond issuance, expected to take place before the end of 2020.
Bogotá, November 2020. The situation caused by the COVID-19 health emergency has driven intense, constructive collaboration with tenants, aimed at prioritizing long-term relationships based on flexibility and innovation.
Support for tenants has led to agreements based on the scale of the situation’s impact on each asset category, with shopping centers accounting for 87% of the relief granted.
During the quarter ending in September, a trend of reopening and traffic recovery was seen across the different categories, with logistics and industrial assets standing out at 94% of user traffic. Commercial assets, as of September, recorded visitor traffic of 53%, resulting in sales levels close to 75% of those in the same months of the prior year.
Both physical and economic vacancy rose in the last quarter by 0.8 and 1.1 basis points, respectively, mainly linked to contract terminations with tenants at commercial assets. These cases have occurred among tenants particularly affected by the situation in segments such as children’s entertainment, gyms, and some restaurants, as well as local brands that had been experiencing payment difficulties. In addition, progress is being made in leasing available space at logistics and industrial assets, which will positively impact the category’s vacancy indicators in the coming months.
The vehicle’s cumulative operating revenue closed the third quarter of the year at COP 325,190 MM, a 4.4% decrease from the COP 340,069 MM reached in the same period last year. This result reflects the relief granted as a consequence of the COVID-19 situation, which had an impact on revenue of 51,551 MM as of the close of September.
The first quarterly returns payment, worth 12,594 million (COP 29,193 per Security), will be made on November 17. The 2020 dividend paid, including the flows paid in February, August, and the one to be paid this month, reaches a level of 4.79%.
Net receivables stood at COP 33,341 MM, representing 7.38% of revenue over the past 12 months. Net receivables turnover days decreased from 32 days at the end of the second quarter to 23 days at the end of the third quarter. Notably, COP 18,481 million of this indicator corresponds to current receivables associated with the relief granted by the vehicle, which showed healthy collections during the third quarter of the year.
The process of updating portfolio asset appraisals continued to advance throughout the year. As of the third quarter, commercial appraisals were completed for 81% of assets under management — that is, assets worth COP5.1 Bn — with a total impact of -1.04% on the book value of the assets; this impact has already been incorporated into the daily unit value.
THIRD AND FOURTH QUARTER OF 2020
During the teleconference, the following key activities for the third and fourth quarters of 2020 were highlighted:
Third Ordinary Bond Issuance: The vehicle is preparing to carry out its third ordinary bond issuance, aimed at replacing debt with financial institutions, continuing to diversify its long-term funding sources, and capturing opportunities to lower its cost of debt by taking advantage of current market conditions.
New Legal Representative for Pei Securities Investors: During the third quarter, Pei’s Annual General Meeting of Investors was held in first- and second-call sessions; with a quorum of 70.52% of outstanding TEIS, Fiduciaria Colombiana de Comercio Exterior (Fiducoldex) was elected as the new Legal Representative for Pei Securities Investors, replacing Colmena Fiduciaria.
Capital Markets Activity: The vehicle continues preparing for its migration to the equities trading market, which the BVC postponed to April 21, 2021.