One United Properties SA ($ONE)

Good morning, and welcome to One United Properties conference call for presenting the Q1 2026 results. My name is Zuzanna Kurek, and I'm Investor Relations Manager at One United Properties. I am joined in this call by Victor Capitanu, Executive Board Member and Co-Founder of One United Properties; and Cosmin Samoila, CFO at One United Properties. Before we begin, I would like to mention that this call is being recorded and that the recording will be uploaded on our website later today. As stated in the call invite, by joining this video conference, you automatically and implicitly consented to being recorded. If you do not consent to being recorded, please leave the call. In terms of organizational aspects, let me present to you the setup of today's call. Firstly, we will share with you the financial and operational highlights from Q1 2026 which will be presented by our co-founder, Victor Capitanu, Cosmin Samoila as well as myself. During the presentation, feel free to type any questions you have for the management in the chat window, and we'll answer them during the Q&A. After the presentation is over, we will start the Q&A session. Please note that all the participants are on mute. If you would like to ask a question, please type it in the chat window. I will be moderating the session. And therefore, for the sake of those who will be watching the replay of this teleconference, I will be reading all the questions aloud before addressing them. Your questions today will be answered by Victor Capitanu, our CFO, Cosmin Samoila or by myself. I would like to mention that we might be making forward-looking statements today during this call regarding the future performance of One United Properties and that the actual results may differ materially. We encourage you to review the disclaimer that we have included in the presentation which you can see right now on your screen. This disclaimer applies equally to all statements made in today's call. Thank you for your patience. And I would like to now to kick off the call and invite Victor Capitanu to share with you the key highlights from Q1 2026.

Hello. Good morning, everybody. I will start the presentation with a focus on the changes in legislation, what happened in Romania. Recently, we had some very important legislation changes in December, what we call the Nordis law basically is the law regulating the real estate development sector that came up after the bankruptcy of developer called Nordis. This framework basically aims to protect the client and wants to make sure that the developers use the money of the client for the actual development for which they are paid. So what it says, it says that every project has to have a collection account, kind of escrow account with the bank. You can only take a 5% reservation fee upon signing unless the unit subdivision is made. If the units subdivision is already made on the project, you can take 25% down payment, including the 5% reservation fee, and you can take another installment of 20% when the structure is ready. In terms of payment structure, this is not less advantageous than we used to charge previously. So we are fine with this from any point of view, including the cash flow. The issue with this new legislative framework is that they didn't give norms for implementations, but they asked to be implemented immediately. So instead of keeping like 3 to 6 months like a period to be implemented, they asked implementation overnight, and they didn't give norms for that. So this is why there is a significant delay in being able to make the unit subdivision of the developments across the sector. What does this mean, the unit subdivision? Basically, you need to register your development with a cadastral office. And you need to have a cadastral file for each individual unit from the beginning of the development or from any stage of the development you are now. So this created, let's say, a pressure on the cash flow for the sector. Of course, we managed to overcome that. But on top of it, we couldn't recognize our sales in the consolidated statements. Since in the first quarter, we could only sign reservations because of this new law. So although the clients wanted to pay and to give down payment, we were only allowed to charge 5% reservation fee, which, of course, went in the special accounts for the specific developments. This had a very significant impact on the IFRS 15 recognition. So you will see a temporary -- some temporary figures that don't reflect the reality of our business. I will let Cosmin Samoila detail more of this when his start comes. Thank you. Nevertheless, we knew about these changes. So when we prepared the budget for this year, we budgeted for that. I know we don't publish quarterly budget but the quarterly results are in line with our budget because we knew this was going to happen. So we stand by our budget for 2026, and we think we are in line to achieve it. Regarding the ongoing business, as you can see here, up to now, we have completed more than 2,800 units with a gross development value of EUR 774 million, and we did a profit on that of around EUR 270 million. We have under construction a little bit more than 4,000 units, out of which almost 2,800 will deliver this year with a gross development value of more than EUR 1 billion. And we have delivery from 2027 onwards of around EUR 400 million. In parallel, we have in the planning phase, more than 10,000 units with gross development value of more than EUR 2.3 billion. On the commercial segment status, by the end of this year, we will reach 200,000 square meters, up from 155,000 square meters standing that we have today, and the value of our rental portfolio will go to around EUR 700 million. We estimate that to reach EUR 1 billion by end of 2030 with more than 300,000 square meter gross leasable area. Regarding the maps and the development, we got some feedback from investors that it is a bit too crowded. So we split the maps in different maps. So you can see here Bucharest, the developments completed up to now and handed over to clients. You see there are 12 developments with around 2,800 units. Go back, please. And what I wanted to see, if you look here, 1, 2, 3, 4, 5, you can see that the initial area, just a reminder to the people that were not previously on the calls, you can see that the area where we started is around Herastrau area, sector 1. So you see a lot of concentration in this sector 1 or bordering sector 1 plus our first expansion to sector 5, where you see #8, One Cotroceni Park, our largest development to date, 300,000 square meter. And you can see One Timpuri Noi in sector 3. So this was our initial expansion across the city. You can move on. And now you see under construction we have now another 12 developments. And you can see also they are now more focused in sector 2 this time. So we expanded east towards our initial plays because the city is kind of moving and developing very fast in this direction, Northeast side. And you can see also some developments in the center in the historic area in the downtown. But you see we are going around these lakes. So these 4 lakes from Herastrau, Tei, Floreasca and Plumbuita are the most attractive selling point for medium- and high-end residential developments. In the pipeline, you can see we have also 6 developments that we are going to launch soon. We have in Floreasca only 1 development, One City Club in sector 2. In sector 1, we have One Park Lane which will start this year, and we have One Herastrau City that is still on the planning, will start after this year, not this year, for sure. And we have in sector 5 One Cotroceni Towers, the expansion of One Cotroceni Park, basically the second phase, a massive development with the tallest residential towers in Romania, 33 floors. We have also in sector 5, One City District, our largest development yet in number of units. We plan to build there 3,200 units. And we are taking for that a very famous French architect in order to design a very desirable product and very desirable master plan by Jean-Michel Wilmotte and you can see in the center of the city, we have One Downtown where we signed a hotel management agreement with Ennismore Group, and we are building the first Hoxton Hotel in Romania. We can move on. Now we put also some extra cities, just to understand what we do in other cities. We have One Mamaia Nord, where we just started sales, very successful sales for the 1st of May. We launched the third phase of One Mamaia Nord. First and second phases are completed. There are a few units to sell, but just part of the profit, and we started the third phase. We had the most successful launch for May 1 up to now. So the sales were very strong for One Mamaia Nord third phase, a bit against market wisdom. And we also secured a fantastic plot, probably the best plot on the Black Sea, maybe Romania, one where we plan to build seven towers between 12 and 27 floors. It will be called One Marina Towers. It's an amazing development, which will be a landmark not only for the Black Sea and Constanta, but also for Romania. We can move on. In Sibiu, we are working to get a building permit to start our first development. It's a very central location. 12, 15 minutes walking to the main old square, the former FLARO factory. We are building here a mixed-use development. Very excited for that. We have a lot of local support and we think this will be a very important development for the city of Sibiu. We can move on. Then in Iasi, we don't own yet. We didn't sign a contract yet, but we are under MOU. So we are in due diligence with a land very close to the center -- to the central shopping mall, I forgot the name, Palas Mall, like 1.3 kilometer, and we have an approved zoning to build a very interesting mixed-use focused on residential, including some 20-floor residential tower. We are very excited with this development and the potential from Iasi. So we are now working on due diligence and hoping to finish and finalize the contract soon. Thank you. In Nashville, this is the land that we acquired in Franklin, which is one of the best zip code in that state with a huge inflow of population, big demand. So this Nashville area is one of the fastest-growing, top 5 fastest-growing cities in U.S., a lot of famous companies are moving headquarters there, Oracle, Starbucks, et cetera, tens of companies. Here, we started with this low-rise development. We are building 48 units. We assembled the land from small plots. So it was quite a tough work, but we managed to do it with our local team. And we might even expand, as you look to the screen to the left of that, which is to the west of our property to make an even bigger development, and we also have a small pipeline of developments for the future years. Thank you. I will let my colleagues continue.

Thank you very much. Thank you, Victor. I will now present the business updates across our residential and commercial segments. So even though we have seen a temporary accounting impact from legislative changes as described by Victor, underlying sales activity remained very strong in the first quarter of 2026. So in Q1 2026, we have sold, presold and reserved 144 apartments and commercial units with a total surface area of approximately -- of over 14,000 square meters alongside 243 parking and storage spaces followed for a total value of EUR 60.4 million, representing a 34% increase year-on-year. I would like to mention that the vast majority of this activity was represented by reservations. So as you have probably seen in our report or in the trading update we published 3 weeks prior to the report, the reservation -- EUR 58.2 million related to reservations versus EUR 2.1 million for contracted pre-sales, reflecting this temporary impact from the new legislation. As a reminder, until the introduction of the law, one did not offer to clients reservations. We were directly signing presale agreements with the clients. At the same time, the price dynamics remained very strong. As you can see on the screen, we had an average price increase for contracted units of 33%. I believe this is one of the highest we have reported since we're a public company. And you can see this increase is driven on the right side by the 4 development. So our best seller for the first quarter, One Floreasca Sunset, where in the first -- excuse me, basically, within a week, our colleagues from the sales managed to sell 79 out of 227 units and the sales activity continued also well in Q2, too. If we look at our portfolio, our full residential portfolio as of March 31, 73% of all units that were under construction were already contracted, either through presales or reservations. You will see the second bestseller was One Lake District Phase 2 continuing the previous strong -- very strong activity from the previous quarters and One Academy Club. Together with One Floreasca Sunset, these are 2 of our latest developments. So we currently have one -- currently as of 31st of March, we had 1,135 units available for sales that were under construction, and we had only 112 completed units available across finalized development, demonstrating the continued healthy absorption levels across our residential portfolio. In terms of the cash inflows in the first quarter of 2026, One United Properties has collected EUR 17 million. If we operated under the old framework, so instead of reservations, if we have had the presales, then the level of collections would have been approximately EUR 30 million. What I would like to draw your attention to the fact that contractual future cash inflows reached a record level. It is the highest level we have ever recorded and reported of EUR 410 million as of March 31, 2026, underlining our strong pipeline, both under construction, so developments nearing delivery as well as reflecting new developments such as One Floreasca Sunset and One Academy Club. These contracted inflows are expected to be collected by 2029, as you can see on the slide, and provides a strong visibility on future cash generation. As always, please note that these figures exclude any sales concluded after the reporting date of March 31. Now turning to the commercial segment. The portfolio continued to be resilient and stable despite the softer macroeconomic backdrop in Romania. So headline rent generated by the rental portfolio increased 2% year-on-year to EUR 7.2 million in the first quarter. Occupancy across the standing commercial portfolio remained very strong with the lease and pre-lease at the level of 97%, while 90% of space was already occupied by the tenant. During the quarter, our commercial team leased and pre-leased approximately 4,600 square meters of office and retail spaces. And I will now pass the floor to my colleague, Cosmin, who will dive deep on the impact on the financial results.

Thank you, Zuzanna. Good morning, everyone, and thank you for participating to our first quarter call regarding the financial results. So basically, in the first quarter, we registered a consolidated turnover of RON 176.5 million. This is a decrease of 51% compared to first quarter of last year. And we did also a scenario, an alternative scenario, what could have happened if this law wouldn't have got in place in this quarter. And without this law, our turnover would have been RON 308.6 million. So a slight decrease, 15% compared to last year first quarter. And you will see also in the next indices that we are presenting, we have this like-to-like comparison to measure the effect of the Nordis law basically. Also, turnover primarily consisted from the sales of residential property, revenue from sales of residential property, RON 122.6 million and also revenues from rental and tenant services RON 42.7 million. Gross profit reached RON 23.8 million in the first quarter, 79% decrease. But again, like-for-like, without the effect of the Nordis law, the gross profit would have been RON 82.2 million. While the net profit reached RON 21.5 million, 78% decrease, and again, this metric without the effect of the Nordis law would have been RON 70.5 million. Very important, as also Victor mentioned earlier, this was anticipated by us for the first quarter, and it was included in the budget as such. And this is why we are maintaining for the full year, the same estimates that we published for -- in March. Regarding the revenues from sale of residential property, this decreased 60% down to RON 122.6 million. Important to mention here is that from these revenues we recognized in first quarter sales of only EUR 2 million. Basically all the other, around EUR 58 million were reservations. For this EUR 58 million reservations, we didn't recognize any revenue and any profit and they will be recognized this profit and the revenue related to this reservation once they will be converted into presales. And again, like-for-like without the effect of the Nordis law, the revenue from sales of residential property would have been RON 254.8 million, 18% decrease compared to the year before. The net income from residential property amounted to RON 39.4 million. And again, here also in comparison, it would have been RON 97.8 million without the effect of the law, and this is compared to RON 111.1 million that we reached last year. Residential margin, it's 32.1%, a moderate decrease from 35.9% net margin recorded last year. On the commercial segment, rental income and the revenues from tenant services reached RON 42.7 million, 5% increase compared to first quarter of last year, while net rental income increased even more, 11%, reaching RON 28.4 million. This is supported by the fact that the portfolio is almost fully leased, 97% as of March 31. On the other metrics, the general and administrative expenses increased to RON 28.2 million compared to RON 15.6 million last year. Very important, this increase was mostly generated by the new stock option plan that was approved in the shareholder meeting from April. The impact of the stock option plan in the first quarter was RON 10.3 million. This amount is a noncash expense. It's just an expense against equity. And it has no impact on the company's cash position or liquidity. As a result, the operating activity result EBITDA amounted to RON 33.4 million, 72% lower than first quarter of last year. But without the effect of the law or this Nordis law, the EBITDA would have been RON 91.8 million. Cash position amounted to RON 394.6 million. It's a decrease of 40%. This is due to the fact that we are in the final stage of development of almost 2,800 apartments that are planned to be delivered this year, and also due to the fact that the effect of the law was that we could have cashed in only 5% reservation fee from the reservations and we couldn't cash in more advance from these sales, but the difference will come in the moment the reservation will be converted into presale. Also, the loan-to-value ratio remained conservative, 34%, slight decrease 2 percentage points compared to last year, and the net debt was RON 1.1 billion, only 17% from the total assets of RON 6.5 billion. Thank you.

Thank you very much, Cosmin. This concludes the first part of our call. We will now open the floor for questions.

[Operator Instructions] And to give you some more time, we will first address the questions that were sent to us via e-mail ahead of the teleconference. I have also posted them in the chat window, therefore, you can also see them to make sure that we don't double the questions. So the first question is, what is the current status of One Cotroceni Towers? And what are the next steps for this project? I would like to see if Victor would like to address this question.

Yes. Thank you. So One Cotroceni Towers has already a building permit. So when we acquired it, we acquired it together with a building permit, a valid building permit. So there is no issue on that. Only that the way it was designed by the former owners made it unprofitable compared to our profitability standards. So we decided to change the project completely and to make it more efficient from cost, both cost and sales prices. And we are now highly advanced to get the new building permit and to start sales for One Cotroceni Towers.

The next question, what is the current stage and strategy behind One United Properties development plans in the U.S.

Thank you. So now for U.S., after we did thorough analyses of the market for the last 2 years, and of course, after we are looking for the last 5 years to find a new market to expand our activity, we decided to start with the development in Nashville and to focus on 2 states on Tennessee and with focus on Nashville and on Florida with focus on Miami. So we have a pipeline for both these 2 locations. We want to start with 2, 3 developments, let's call them pilot developments, in which we want to -- let's say, we want to verify and to make sure that our assumptions were correct and that we are making similar profitability to what we are making in Romania. And if so, this could be potential for a bigger expansion. We don't want to start with something big or huge. We want first to learn and to establish our strong presence there. We have an advantage on the market. We have seen the environment, the demand, the competition. And now let's see if we can take advantage of that.

Could you provide more technical details regarding the development in Iasi?

Look, Iasi is very early. So there is no technical detail to be presented at this stage. We are in due diligence. So we do legal, commercial, technical due diligence. At this stage, it looks like everything is okay and everything will be closed in time according to our Memorandum of Understanding. After we acquire, we will make the specific projects, so we'll design a specific project with our teams of architects, maybe we make a competition for the architecture. And then we will file for building permit. So when we file for the building permit, we'll be able to give technical details and, let's say, more transparent information. Thank you.

What has been the average monthly sales pace over the last 3 years? And how has it evolved over time?

Can you please repeat, Zuzanna?

What has been the average monthly sales pace over the last 3 years? And how has it evolved over time?

Look, for the last 3 years, let's say, real estate sector was a bit under pressure since the interest rates started to increase. So you can see this all across Europe. We are lucky to be in a developing market, which didn't have the same pressure, but still, for the last 3 years, sales were more or less constant. So we couldn't see like a big trend going up or down, and we are selling more or less around EUR 15 million to EUR 20 million every month. You can see even in the first quarter of this year, we sold around EUR 20 million per month, but the actual monthly average is around EUR 15 million to EUR 20 million. If you look to first quarter last year, we sold around EUR 15 million. So more or less, this is what we are looking to the monthly sales. Of course, the sales are not linear, yes, because we are not selling chips or sparkling water. So the sales have kind of volatility from month to month, but the average stays there.

How do you assess the current market environment? And to what extent do you believe there is still room for further growth in the price per square meter?

Look, the market environment, we think, is very good. Demand is strong. We saw the market price increase quite fast in the last 12 months. It's the fastest we've seen since 2008. So let's see if this is a trend that has inertia or not. On the other hand, although we reported higher price per square meter in our portfolio, our actual increase in the last 12 years on the existing portfolio was significantly under the market. So if you take out our new launch from One Floreasca Sunset and you look across our portfolio, you can see that compared to the market, our portfolio became more accessible because the market in general grew in the last 12 months with around 22% in Bucharest. And our portfolio probably grew only -- increased only around half of that. So we see strong demand. We saw the new launch that we did in One Floreasca Sunset, how fast the sales are evolving and how big is the absorption rate. We'll launch soon One City Club and One Park Lane. So we'll have a chance to check it also on different income segments. But it looks like demand and absorption for our product are in one of their best years yet.

Thank you. The next question, are you selling with lower discounts now than before the law has changed?

Look, in terms of discounts, we don't really give discounts. We have this policy in which because if you have a discounted product, then one client who knows about this will get the discount, one client that doesn't know will not get a discount. So we think it's not fair to the clients to have a discount policy. I think it is fair to the clients to have correct prices. We always had correct prices. Of course, if there are institutional investors or funds or the portfolio that is acquired is sizable, then, of course, we can discuss based on the size of the acquisition. But normally, we make fixed prices, we don't have a discount, and this policy has not been changed over the last 15 years.

Thank you. The next question again about the residential demand outlook for 2026. I'm not sure, Victor, if you'd like to add something more on top of what you said.

Thank you, [ Cosmin ], for the question. Yes, I mean, demand looks very promising, especially for the new launches. We are positive on the demand. So demand is good also for the existing developments that we are finishing this year. We will be in a good position because if you can take a low down payment and the clients can take mortgage loans, so finally, clients can buy it with low down payment. So we think once the developments that we are delivering this year are finalized, they will be much more attractive from the point of view of the buyers with mortgages. I told you we launched One Floreasca Sunset. It was our best launch ever. So this happened in 2026, not in another year. We are launching One City Club and One Park Lane. So let's see also the market on that. But we can see the, let's say, the interest even before the launch. So we think they will be very well received by the market. So overall, positive outlook for the residential demand for this year for specifically our product.

Thank you, Victor. The next question, what percentage of active reservations as of March 31, 2026, do you estimate will be converted into presale contracts by the end of Q2 2026 and respectively, by the end of Q3 2026?

My opinion is that close to 100% because even if somebody will not fulfill on the reservation, you already have the 5% deposit on it. So already the unit is even more attractive. I know that theoretical 100% doesn't make sense, I don't know. We can say, 90%, 95%, I don't know.

I think the question was also pertaining, Victor, to actually signing the presales agreement with the client. So if we're going to be signing actual presales agreements in Q2 or Q3 on those reservations. This is how I read it.

Okay. I didn't get the timing. In terms of timing, we are waiting this month to get the unit subdivision papers for One Academy Club and One Floreasca Sunset, where is the bulk of the reservations. So I don't know if Cosmin has -- maybe Cosmin has the numbers. Like we expect a part of it to be converted this month. But to be honest, it's in the hands of the authorities. So administration of the state has to issue us the unit subdivision that we are waiting -- we are waiting for them since December. So if these papers are issued, we'll be able to sign the actual precontracts. If not, most will go in the third quarter. So I don't know, Cosmin, do you have better visibility on this than me, maybe?

No, no. It's exactly as you said, when the paper for the subdivision will be issued, we expect by the end of May to be issued. So basically, we will have one month to sign presales. We'll see how much -- many will be converted in June, meaning in second quarter. What is not converted by the end of June, it will be converted in the third quarter.

Thank you. The next question, what is your operational strategy regarding the pre-apartmentation going forward? Specifically, do you plan to accelerate the pre-apartmentation process across the portfolio in order to advance revenue recognition and collect a higher percentage of customer advances earlier in the construction cycle? Or do you intend to keep your current operational approach unchanged and simply absorb the timing impact on revenue recognition?

Yes, I will explain this. Very good question. So basically, what we call in Romanian [Foreign Language] we call it in English unit subdivision. So basically, it's when you make the cadastral -- the individual cadastral files for each unit. So what we are going to do going forward, let's say, we have a new building permit, if the developments are smaller scale like One City Club, we will start selling our reservations right away because the pressure on the cash flow cannot be huge in any case. And we proceed with the unit subdivision papers immediately in parallel, which normally have to take up to 2 months. So normally, if the administration would move as per the rules, it will be no issue. For larger developments like One Cotroceni Towers, One Marina Towers, where we don't want to have any issue or blockage, we will first do the unit subdivision papers after we get the building permit and then we will start the sales. So basically, the moment we launch sales to larger developments, we already have the unit subdivision papers in place. So we will not sign reservations anymore. We will sign directly pre-contract like we used to be before. So let's say, going forward, for the larger developments, the process will be similar to how it was before this law. With the smaller developments, because cash flow impact is not so big, we will start sales immediately after the reservation. Now regarding the developments ongoing now, there are some developments that are very advanced, One Lake Club, One High District, One Lake District Phase I, they are huge developments, but they are almost completed. Some of them will complete soon. All of these 3 are completed this year. The issue now is that if we start now the unit subdivision process, this process will delay us the actual reception of the development and the actual final unit subdivision. So basically, we cannot do the preliminary unit subdivision this [Foreign Language] because the developments are too advanced. So we will have to face pressure and just reserve apartments because we need to go straight to the final unit subdivision. We cannot do the preliminary just because it's too late. So basically, for those ongoing that are very advanced, we have no choice but to put, let's say, more pressure on our cash flow, take only reservation and just finish them. For developments that are ongoing, that are in earlier stages like One Academy Club, like One Floreasca Sunset, of course, we are doing now the unit subdivision. And after this, they will continue to function as it was before you sign directly precontract, you get 25% down payment, then you have another installment after the structure is ready and so on. So, [ Irina ], let me know if I explained it quite clear or not. If not, I can go over again on this.

Thank you, Victor. The next question, given that in Q1 2026, One delivered RON 21.5 million in net profit, this implies an average quarterly net profit of roughly RON 145 million from Q2 through to Q4. What gives you the confidence that this run rate is achievable? Specifically, which quarter do you expect to be the strongest contributor? And what are the 2 or 3 key operational milestones that we -- that need to be hit for the budget to be delivered?

Cosmin, you answer this, please.

Yes. Basically, we are confident in this because, as mentioned, all these reservations are contracts already signed, only that we couldn't recognize any revenue for them. So once this unit subdivision is done or the construction is completed, for all these reservations, we are expecting most of them, almost 100% of them to be converted to new sales. So this is -- this will trigger a very progressive effect on the revenue recognition. On the expectations, we expect Q3 and Q4 to be the biggest contributor to this profit because Q2, it's already May, and we see that -- with the unit subdivision we finalized by the end of this month on One Floreasca Sunset and on One Academy Club. Also, I want to make a mention regarding this unit subdivision is that we did from the very beginning from December, we started doing procedures to record this and to fulfill this additional procedure. The difficulty was that the authorities didn't know how to implement this. I mean, this didn't took -- we are now December, the law started, it's 6 months already up to now. So we work continuously these 6 months, but all the time, we had difficulties with the authorities to record this new procedure, which also they weren't aware how to tackle it.

Let me add on that. You asked also what are 2 or 3 key operational milestones. I think some key operational milestones is to start signing final contract on One High District and One Lake Club. This means to finalize it to authorities and to start delivering them to clients. So this, I think, are some very important operational milestone for the recognition of profit. Of course, Cosmin, tell me if I was right about this?

Yes, yes, yes, correct. Yes.

When do you expect to start reservation sales in Sibiu?

Sibiu probably we start work -- we get the building permit this summer, probably by end of Q3, Q4, hopefully, this year. So we plan it for this year.

Can you confirm that One High District and One Lake Club Phase 1 project will be delivered -- received and delivered by June 30, 2026? Will that translate into full profit recognition in Q2 2026?

No, we cannot confirm that. Most likely will be like Q4, I think. If it's finishing earlier, it's a bonus. Just it takes so long with authorities. So if you ask me, I think, with all the process with authorities and administration is very lengthy and very complicated and lengthy, but hopefully, this year, we are able to sign the final contract on this. So I think if you budget it for Q4, it's okay.

Thank you, Victor. We have one more question that I will read. Other than that, I think we have answered everything. If you have any other questions for us, please type them now in the chat window.

There is one more question from the...

Yes, yes, yes. I'm going to read it right now. There is a follow-up on the question about the discount. So I was referring in terms of discount to acquisitions in the development phase in the past to acquisitions in the reservation phase or in the phase of signing the preliminary contract now after the change of the law.

Look, there is no change in our policy. There is no change in our strategy. Also, this law, in reality, shouldn't have any significant impact. The fact that was passed overnight without norms for implementation, let's say, the legislator on their own, put pressure on the system and just made a little mess out of it. Because in reality, after everything is in place, more or less business should be continuing as before. Now referring to your discount to the acquisitions in the development phase. So what we do, we don't give discounts or -- we just manage it with our pricing policy. So basically, we have certain level of pricing when we launched the development and the price increases gradually during the life of the development. Now what you saw in the market in the last 12 months was a faster increase in the price because also the pressure on the cost was quite high and the demand was growing compared to the supply. But going forward, we typically see an average increase in the cost of 5% to 10% per year. So basically, if you buy in a development phase and you wait 2 years, probably price should be like 15%, 20% more after 2 years. So if you see that as a discount because it is a discount, that is, let's say, the number, but it's not related with the law. So it's not related with our law. This was always in our selling -- pricing policy.

Any update on One Modrogan?

Look, on One Modrogan we are waiting for the term to go in court. And hopefully, after we go to the court next time, we get a positive decision and we can resume that works. So we estimate that by the end of this year to have legal clarity on One Modrogan and to be able to finish the development.

Thank you. Do you see the Nordis law as a regulatory nuisance somewhat affecting your capital cash flow? Or you see it as an opportunity which might force some weaker developers out of the market? Are you seeing more plots and more projects being offered to you, for instance?

Look, I think this law is not so bad if it is implemented properly. So after everything functions correctly, I think the law has some good aspects for both the clients and the developer. I think the effect on the cash flow is just temporary because they did not publish the norms. I mean, this is -- I'm sorry to say, but this was very, very stupid. They passed a law. They asked to be implemented overnight and they didn't publish the norms. This is ridiculous. But we manage it now. And after there would be full clarity and the norms would be very clear, we will go more or less back to normal. And I think there are more positive aspects from this law. Of course, I think this puts pressure, especially this with the norms puts pressure on weaker developers. And I think, yes, maybe some people will be discouraged or maybe they will not continue their efforts. In terms of plots and projects, we always see with priority the best plots and projects on the market. So nothing has changed there. So every day, we see some interesting plots, projects. We see a few hundreds per year, and we are quite selective. We closed on about 1% of what we see. So I didn't see like a big change on that.

Thank you. And the last question, when will you have an update for the public regarding the buyback offer till the end of Q2?

I mean, I almost don't want to answer on this because every time we said we are ready to do it, we delay it. And this was because of the financing arrangements that we have. Hopefully, this quarter we'll have an update on this. What is important to say is that we are committed, and we are doing it.

Thank you very much, Victor. This concludes our teleconference. Thank you all for your participation and your activity in the chat. We're happy to receive all your questions today. Next time, we are going to hear each other is going to be in August. We will be publishing the results for the first half of 2026 on 26th of August and we will host the teleconference in English as usual after we publish the results. We would like to thank you all for joining us today, and we wish you a great day ahead.