MRM_REGISTRATION_DOCUMENT_2017
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Information on M.R.M.’s activities
Key figures
Income capitalisation approach These methods consist, on the basis of either reported or existing income, or theoretical or potential income (market rent or market rental value), of capitalising this income by applying a yield rate. Income-based methods are also known as “income capitalisation” or “return” methods. They can be applied in a number of ways depending on the income base in question (effective rent, market rent, net income) to which specific yield rates correspond. The capitalisation rates correspond to the yield on the seller’s side or with a view to a management year. The capitalisation rate expresses, as a percentage, the relationship between the gross or net income of the property and its monetary value. It is called gross or net depending on whether the gross or net income of the property is chosen. As of 31 December 2017, the average capitalisation rate was 5.3% for the retail properties portfolio and 5.7% for the office properties portfolio.
The yield rate corresponds to the yield for the buyer or investor. The yield rate is the ratio, expressed as a percentage, of the gross or net income of the property to the capital committed by the buyer (acquisition price + transfer fees and duties = gross monetary value incl. commission and fees). Discounted cash flow method This forward-looking method is based on estimating income and expenses relating to the property, determining a “final” or exit value after the analysis period, and discounting all cash flows. Over a given period and on a forward-looking basis, it involves anticipating all events (reflected as financial flows) that will have a positive or negative impact on the life of the property (rents, charges, vacancies, works, etc.). By discounting, all future financial flows are stated at today’s value in order to determine the present value of the property.
Summary of appraisal valuations by segment of activity
Retail properties
31/12/2017
Appraisers
Jones Lang LaSalle
55% of assets (1) visited less than 8 months ago 24% of assets (1) visited 8-24 months ago 21% of assets (1) visited more than 24 months ago
Date of the latest visits
17 assets held in full title 1 asset held in co-ownership 3 assets held in “lots de volume”
Type of ownership
Appraisal value excluding transfer taxes
€159.0m €159.0m
Value in the consolidated financial statements
Capitalisation rates
Between 4.4% and 7.9% (i.e. 5.3% on average) Between 4.1% and 7.3% (i.e. 5.0% on average)
Net yield rate
76%
Occupancy rate (2)
Office properties
31/12/2017
Appraisers
Jones Lang LaSalle
9% of assets (1) visited less than 24 months ago 91% of assets (1) visited more than 24 months ago
Date of the latest visits
Type of ownership
2 assets held in co-ownership
Appraisal value excluding transfer taxes
€42.3m €40.6m
Value in the consolidated financial statements
The €1.7m difference is due to the application of IFRS 5 as both properties are assets held for sale. Capitalisation rates
5.7% 5.3%
Net yield rate
78%
Occupancy rate (2)
(1) By value as of 31 December 2017. (2) Ratio of area let to area available for letting in buildings in operation as of 1 January 2018.
M.R.M. 2017 REGISTRATION DOCUMENT
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