Vastned (VASTB) Earnings Call Transcript & Summary

First of all, welcome, everybody, to this analyst call on the 2024 annual results of Vastned. Today, Barbara Gheysen, our CFO; and myself, will present you the numbers of 2024. After that we've made the presentation, we will have some time for a Q&A session about the results itself. And I assume you all have questions also about the future and the pro forma statements that have been published in the [indiscernible] I think you can all see the screen now with the presentation itself. Okay. Perfect. So what we will discuss today is, first of all, some highlights, then we will go more in depth into the operational results of the Vastned Group over the last year. We will discuss also the financial results, both from stand-alone numbers from the former Vastned Belgium and because our press release was only on the 31st of December 2024 and then it was only Vastned Belgium stand-alone. We will also give you an update on the financing positions on the work that has been done. We will give you a short highlight about reverse cross-border legal merger that has been effected as of the 1st of January 2025. We'll give you an update about the market situation in retail and confirm the dividend and give you an outlook. So if you look to the key highlights, key highlights itself, it was quite a busy year, and you see that it's most busiest in this last of the year. So what happened in 2024? First of all, we did the refinancing of the Belgian credit facilities. That was done in January 2024, where we refinanced EUR 125 million. And there, we also made the announcement that we would stay below 4% of interest rate. And as mentioned in the press release, we ended at 3.8% as an interest rate. At mid-May, we announced the intention to merge of the cross-border legal merger. It has not been done that often. The last one which was done was Ahold Delhaize. So it was quite a transaction, which was announced mid-May, and then we signed in the course of July the joint merger protocol between Vastned Belgium at that moment and Vastned Retail on the other side. In that spirit, when it was published as well the proposal -- the joint merger proposal, there was a time period of 3 months, which needed to be followed because of the European legislation before it could be approved when we do a cross-border merger. So that resulted then in a shareholder meeting on the 25th of September 2024, where it has been approved in Belgium unanimously and in the Netherlands with 99.9% of the votes. So there was good support for this transaction. In the meantime, we also relocated our offices in Antwerp. So we moved just the other way of the street to a new building. And we announced the nomination of Barbara as CFO from the group going forward as well. Then in December, we made the publication where we announced that the commitments have been obtained for the refinancing because we will see it later in this presentation there was, in the former Vastned, we had a refinancing wall of, first of all, the bridge financing, which came to an end in March 2025 and also a revolving credit facility, which came to an end in September 2025. Those have now been refinanced for a total amount of EUR 345 million. That was needed just before the prospectus because 2 days later or 3 days later, we announced the prospectus, which has been published on the website and approved by FSMA. And that prospectus had then also a clean working capital statement because all the commitments have been obtained. We also had our 25-year anniversary on the stock exchange here in Brussels from Vastned. So we came to the stock exchange on the 17th of December 1999, just the last one before millennium. And on the 24th of December, we announced the acquisition of 2 retail properties, one in Louvain, one in Namur. And that was also a first acquisition after 7 years for Vastned Belgium. And then on the 1st of January itself, we have done the completion of the cross-border legal merger with Vastned Retail. So that means that, as of now, we are the new entity called Vastned and no longer Vastned Belgium. So following that date and the completion of the merger, also the decisions that have been taken by the Annual Shareholders' Meeting have now been put in place. If we go to the next slide, we see then the operational results of the Vastned Group. So here, we still summarize our portfolio. The portfolio is the net property value you see still the biggest part, 36.7% still located in the Netherlands, so EUR 454.1 million. In France is the second biggest country with EUR 265 million. Then Belgium, EUR 330 million, so there is an increase with EUR 10 million due to the acquisition of Namur and Louvain. And then in Spain, EUR 85.2 million. That brings our total portfolio value to EUR 1.2 billion with an occupancy rate of 98.7%. We still see lower occupancy rate in the Netherlands. It was slightly higher compared to last year from 97.2% to 97.6%. But overall, our occupation rate still remains high with 98.7% over all the countries. And in the next months, we will work hard to still keep this high number and even increase the number, just what we are aiming for. If you look to the rental activities. In total, we signed 128 contracts and those contracts had an increase like-for-like with 1.2%. That like-for-like increase is lower compared to 2023 where we had 8.6%, but the decrease in the like-for-like growth you see there is linked to Spain. In Spain, we had a unit empty in Malaga. That unit is in the meantime relet-ted. So we have a new tenant for that unit, but of course, impacted our 2024 results significantly. In Belgium, we had also a lower amount from 6.5% to 0.1% that was due to a rent renewal with one of our bigger tenants that impacted our like-for-like rental numbers. And in the Netherlands, we also had a bankruptcy and there was a bigger unit from the former Ted Baker, which was empty, and of course, impacts as well our like-for-like rental growth. Note, this like-for-like rental growth excludes all the divestments that have been done. But the most important number, I think, is also here to see that we have a growth compared to ERVs that have been determined by the valuation experts. You see that we have a 7.1% increase compared to ERV. And you still see there we put it on the different countries, it's almost equal around -- between 6.7%, 7.7%, so all in the range for the 3 biggest countries. Spain, 5.3% compared to ERV. But I think it's still a number like -- worth mentioning because this can, in the future, as well impact the valuations. If we go to the next slide, we also included the investment property, the valuation movements. So here, we put in the like-for-like valuation movements because I think that's also an important one to show. What we did is we went from 2023 to the first half of 2024 and then to year-end 2024. And I think an important number here to show is that we have -- in the first half of the year, we had a decrease of EUR 1.1 million. The decrease was mainly linked to France. In France, we saw there a big impact of the yields that were decompressed and they increased in percentage. So there, we had an impact of 3.5% on the total valuation of the portfolio. In Belgium, we had a slight positive valuation. And similar in Spain, where you still see we go from EUR 79.5 million to EUR 85.2 million at the end of this year. So in a period of 1 year 2x a bigger increase. And that also shows that the attractiveness at this moment from the Spanish market, where we still have some yield decompression. In the end -- compression, sorry. In the end, we have an average yield of 5.8% on our total portfolio. The average yield has been calculated as the rental income divided by the appraisal value and fair value. So we have 5.8%. What is also -- 2024 was also the year of the divestments. And these divestments also ensured that our loan-to-value ratio came to a stabilized level of around 40% that we put in. We will also explain that it's slightly higher compared to the 40% due to the payment of the interim dividend at the end of the year. But in total, we did divestments for almost EUR 140 million. Important one here is to mention that the divestment program also stopped, meaning that no divestments are in the pipeline at this moment. However, if there are some good biddings, of course, and the prices are above the valuation and we can buy, for example, a new property with a higher yield for the same amount, then of course, we will always consider that. It's not that nothing can be held for sale, but at a good price we can always have a look at it. We also made an acquisition. So as mentioned, that was the acquisition of the Gevaert portfolio, so it was the building in Namur and in Louvain. It was a good acquisition, which was also supported by all the shareholders. And the acquisition was at a total fair value of EUR 10.2 million. It was a share deal. So that also allowed us that we could increase the return for our shareholders. And we come here to a return of approximately 80% on this acquisition going forward. There is still a value add that we calculate for this one because the building is located -- it's a corner building just located to our other building in the Bondgenotenlaan with H&M as our tenant. So we are in discussion to see if we can, of course, expand our building with the H&M. If not, we're also going to look for another tenant in order to maximize the valuation and the rental income. I think also important that we always look for redevelopment and value-add projects. That means that we are going to go next year as well in depth through our portfolio to see where there are any possibilities to unlock value for our shareholders and to show what is the hidden value still in this portfolio.

Okay. Then we move to the financial results of the Vastned group. And just to note, first, we will discuss the Belgium results. And then the next slide will include the results on a consolidated group level based on the pro forma financial information. So in Belgium, we see, in terms of rental income, a slight decrease in the rental income partially because of rental renewals, which were accounted for as a lower rent as compared to the former rents and also dating from 2023 contracts, which now have the impact in the financial year '24. Then next to that, we had some more vacancy, for example, in Namur, where we applied to renovate the building in the term in which we needed to have -- to obtain the building permit to redevelop the property. We could not let the building at its full value. Also the new acquisition that is not included yet in the rental income as it was only done at the end of December. So next year, we will see the increase in rental income due to the new acquisition. The next, property charges. They increased as compared to last year also because of some more vacancy. So then we need to bear more costs on our properties. General expenses. There we also note an increase because we had to reinforce the team because of this in the preparation of the merger. So there were more people on our payroll. Then also the interest charges negatively impacted the results. Although we did a really good refinancing in the summer of early January, which became effective in the summer, we note that the interest at which the contracts are concluded are slightly higher also because the fixed IRS rates are now higher than in our previous refinancing rounds. Then the net result ends at EUR 10.6 million for Belgium. That's the net result bottom line. So including all the fair value changes and also in investment property and in mark-to-market of the financial derivatives. Whereas the EPRA earnings at EUR 12.1 million does not include the fair value changes in investment property and derivatives and also excludes exceptional costs, for example, the costs related to the merger. In the end, our EPRA earnings per share are at EUR 2.38 as compared to EUR 2.81 last year. That's for Belgium. If we now move to the pro forma information. So maybe important to note that the pro forma -- we refer to pro forma as it's the not fully audited presentation of our consolidated numbers. So these are set forth based on our consolidated Vastned Retail N.V. consolidation, which was still performed, but we translated this set of financial information into the Belgian format of presenting our balance sheet and rental results. So rental income, of course, if we had major divestments, we see here that it's -- that what was the main driver of our decrease in rental income. So rental income decreased from EUR 72 million to EUR 68.5 million. So that's a big impact by the divestments. Also, the property charges were negatively also contributing to the EPRA results in the end. General expenses, as for the year 2024, it was, as we said, a year a bit in transition, which we also see in the general expenses. We had some more people on our costs, which were only on a temporary basis included in our expenses. Next to that, we had also higher appraisal costs because for our reports we need to issue, we need sometimes appraisals at other data points. And also IT costs went up a little bit. Then the interest -- net interest charges also increased. There, we have 2 combined effects. On the one hand, the volume of interest of credit facilities decreased because of the divestment program. But on the other hand, we also saw that the interest rates increased because in the Netherlands, there was a bridge facility installed and also because of the refinancing done in Belgium at slightly higher net interest costs. So our net result bottom line is negative for almost EUR 7 million. So if we translate that to EPRA earnings, we have a whole other number, which is more aligned with the direct results, which was previously reported by the Netherlands. So the EPRA earnings are at EUR 35.3 million, which are -- which is [ lower by EUR 5 million. ] This means that the EPRA earnings per share, based on the pro forma accounts, so it's not comparable to what the reporting of Vastned Retail N.V. was before. So we cannot compare the EUR 2.18 because it's calculated on a basis of 16.1 million shares, which is the number of shares which are entitled to receive dividends in the new setting going forward. On the next slide, we have some key information also for your interest because I already discussed that maybe important also to note that on a group level, our average all-in interest rate, so including also all the costs like upfront fees and commitment fees, they are now at 3.2%. And as we are in the process of refinancing, we see that these interest costs will increase up to nearly 4% as of 2026. On the taxes, also maybe something to note and explain. When we sold the Rokin Plaza, we had to recognize a deferred tax liability for a big amount for EUR 11.5 million. This will be reverted as of Q1 in the results. So it's not a cash tax, let's say. It's related to reinvestment that needed to be done, but which is being done as in Q1 2025. So the key figures per share, we have some numbers also on the group or consolidated level. So the number of shares, which is also used to calculate for all our net value -- or net asset value ratios is 19.469 million number of shares. These include 3.3 million of treasury shares. So in total, there are 16.1 million of shares entitled to receive dividends. Our net value at fair value measured is at EUR 34.88, whereas the net value at investment value, so including the property taxes, is at EUR 39.45. Then the EPRA indicators, NRV, the NTA, NDV, they are ranging from EUR 40.53 to EUR 35.03. As our stock price -- the stock price of the Belgian share that is -- was at EUR 27.6, we note with a discount of 20.88% [indiscernible] our discount actually decreased. It's a nice side effect of the merger as well. Our debt ratios are ranging between 42.11% for the loan-to-value to 43.54%, which is the debt ratio based on the calculation of the Belgian regulator. And they include already -- so they are higher than the 40% or slightly above 40%, which we aim for with the divestment program. And that is because of the fact that we already distributed all the dividends relating to the fiscal year or the accounting year 2024. So the next dividend will only be paid in 2026. So that should allow us to build on -- to build more cash or to increase our liquidities and to [indiscernible] Financing position, there we're also going to talk you through. So as at the end of 2024, we already obtained commitments from the major banks we work with to have a refinancing. Why was that important? As you see on the graph, the maturity of the credit facilities, except for the lines which were already refinanced in Belgium, Belgium, all the debt became at maturity in 2025. So that was, for our company, a big amount of debt to be repaid. So we already talked with the banks in December 2024. And we got commitments from all of them. We took out the bridge loan. So that was our major focus in January to take out the bridge loan. Why? Because it was a really expensive form of financing. So we -- that was our #1 priority started in January. Also, there, we had a syndicated RCF of EUR 200 million that became due -- becomes due in September 2025. This was a really cheap form of financing, which has been in place as of 2014 and then renewed. But that also because EUR 200 million is a big amount to repay based on our debt position. We already also refinanced that. Well, how does our financing position look like as of today, including all the refinancing because the bridge loan was already taken out and the syndicated RCF will be refinanced at the end of February? So actually on Friday, we will refinance that as well, starting of which, we are in our new financing structure, which has a more -- better spread in due dates. So the maturity dates, it allows us to have sufficient financial headroom. So we have at least EUR 35 million of headroom, and we are looking also to increase that. Our average cost is to be at 3.2% for 2025 and then will increase to 3.9%. Also, in terms of hedging, there we see on the left slide -- left graph, we see the same situation. So we had a lot of debt expiring in 2025. We also had a lot of interest rates expiring in 2025. The debt that we already had to take out, also the nice syndicated RCF because banks cannot have double commitments. But we keep the interest rate swaps, which were in place and which will mature in September. We already had for the refinancing also concluded IRS contracts, so we are now hedging almost all our interest rate risk at the moment. Why is that? Because we see that the financial markets remain volatile due to economic and political uncertainties, whereas our income is more stable. So we think it's a good idea to hedge, of course. We signed additional contracts in the first months of 2025 for an additional EUR 180 million. So at the year-end, we were structurally under-hedged. Now we are at a good level of hedging. Today, we have EUR 410 million notional amount, which is being hedged.

We then go to the reverse cross-border legal merger. We just want to show you again the graph that we have a simplified group structure. So we go from the past with the Vastned Belgium and Vastned Retail who were both stock listed, and Vastned Retail had 65% in Vastned Belgium. You see also there that under the Dutch subsidiaries, you have 2 different Spanish subsidiaries who were 100%. If you now look to the new simplified structure post reverse merger, you see that you have one Vastned and then you see all the different entities just below so the French, the Spanish and the Dutch. But in Spain, you see that there is only one subsidiary left. That means that we did a merger of the 2 Spanish entities just before year-end. That also entitled us this year a tax saving due to that merger. So that has been executed. We also did an execution in France. There, we also merged 3 different companies because we wanted to centralize the assets within 1 entity with regional assets. So that's how we structured also the French entities. And then important for France is also that we obtained the SIIC statute still. So there, we still have the same status as in the past, which had Vastned Retail. So we opened a permanent establishment in France, and that permanent establishment obtained the SIIC status. So it means that we can also benefit from that side that it is like a former FBI -- [ FEE ] status. The only thing there is that we have 5% tax -- branch tax for upstreaming the results from France to Belgium. Then in Spain, we also applied for SOCIMI regime. There, we have started in order to apply for this regime. And then in the Netherlands, what we did there was also a restructuring of the group with the creation of new entities. So where we transferred the -- from the former FII entities to new entities who are no longer tax exempted. We will also see later on the outlook the impact of the tax for the new FII regime for the update there. There will be an additional tax expense for the next year of EUR 2.6 million estimated. I think it's important that following the restructuring we did in the Netherlands that this tax is almost EUR 800,000 to EUR 1 million lower than the initial calculations we made. If you look to the market situation in terms of retail, I think there the question is are we in sort of retail renaissance? Is it going to be better or not? I think, first of all, what you see there still in the trend is that location is key. And we see that properties located in secondary or less desirable locations have more vacancy. If you are on the good spot in the street or in a really High Street and in a good city, then your vacancy rates are lower and you get better rental prices. We see that also, for example, in Belgium on the Main, the rental levels have been stabilized, no longer decreases in terms of those rental levels. But again, location key and it is important, and that's what -- the benefit we have, of course, is we have a unique portfolio. That's also why we did the decision for the Gevaert. For example, the building in Louvain has a very good location with the potential going forward. And that's [ one is ] also made a good deal. The location in Namur was also very well leased out and there is also redevelopment in the neighborhood going on. So that will also be a good location going forward. But the second is also in terms of location, we saw a lot of bankruptcies and that, I think, when you have a good location, we also see that all those units are filled up again. We have in Belgium, for example, we have a lot of bankruptcies over the last period with the [indiscernible] but all those units are almost fully relet again. That's similar into the other countries because of the high occupancy rate that you saw earlier on this presentation. The second point in terms of retail is that the customer experience is there. We all heard that everybody would go to e-commerce. We still see that e-commerce is slightly growing, but not a big part like they did in 2020 and also due to COVID. Customer experience. It is important to our customer experience because the brands and that we also saw some former e-commerce brands are now fully going into physical stores. So there is still a need for physical stores. However, the brands who are doing very well, for example, Zara, they really give you a good customer experience and that's also why the footfall in those stores is very good in those locations. I think the question here is that -- 2 questions is that, first of all, the yield decompression, did it end? I think that repricing has been stabilized and that's what we saw also earlier in this presentation. We saw still a big hit in the first half of the year. But if we look now to the valuations over the different countries in the second half of the year, we see that those have been stabilized and we saw even some pluses coming back. So let's hope that the yield decompression stop and that we can still see some appreciations in the next year with respect to our properties. That's also, I think you see that the investment market was also very at the bottom. And going forward, we hope that the investment market will attract again and that can, of course, have better impact on the valuation of the properties. And I think still be cautious about bankruptcies. Inflation remains high. We still see it, it's not yet at the levels the European Union wants. We still see and hear that profitability from retailers has been still -- have a big impact there. It's not only the rental prices, but it's also for them the inflation and the indexation of the salaries, which is also a big part of their topic. I think in terms of footfall, we see if you walk into the High Street, you still see a lot of footfall in Paris, for example, the tourists are back. So they're all positive signs. However, question is are people spending already? Yes, they are spending, but they are a bit more cautious. And that can impact again on bankruptcies. This moment, we do not have anything that we foresee, to be fair. But of course, we will follow up if the tenant is -- we see a delay in process then we will, of course, monitor closely. And then in terms of the dividends, as already announced, we have had 3 different dividends. For Belgium, we had, first of all, an interim dividend announced on the 22nd of November for EUR 2.30. And in the Netherlands, we had an interim dividend paid out on the 6th of December for EUR 1.70. Those are 2 final dividends. So those -- we will not propose to the shareholder [ a new ] dividend because we saw that this was also following the amount we could distribute in line. We did not distribute it much [indiscernible] It was also announced to be fair on the -- when presenting the merger protocol to everybody, then we also announced these dividends. Then there was an additional intermediary dividend that has been paid out on the 7th of January that was EUR 1 fixed and it was only for the Vastned Belgium -- former Vastned Belgium shareholders. So for 1.7 million shares, we paid out EUR 1 in order to compensate them for the loss in terms of direct result or dividend following this merger for the next 2 years. That brings us to the outlook for next year. So as mentioned, the outlook, first of all, we have the abolishment of the FII regime in the Netherlands. As mentioned, it will impact us EUR 2.6 million tax expense. On the contrary, there, we will work on an operational synergy, and we are working hard on it. It's our daily life to look for synergies and to look for how we can decrease all the costs. We have put forward a number between EUR 2 million and EUR 2.5 million, and we are working hard to realize this number going forward. But that means that there was already part realized due to the simplification of the structure with one Board of Directors, one management teams. But on the other hand, we also revised all our contracts. We had -- did some tenders for internal audit, external audit. We did a tender for our valuation experts. We will do the same for IT infrastructure, for insurances going forward. Our interest rate for 2025 will be approximately 3.2% following the refinancing that needed to be done. Considering the financial markets we are in today, I think it's still a good interest rate at this moment. We will also focus on operational excellence, meaning that we want to work much more integrated cross-border over the different countries. So it means people from the Netherlands can assist the Belgian team or the French team or vice versa. So that's an approach we are going to apply much more that can also, of course, operational excellence help us to realize those operational synergies. But there is also a link that, for example, in terms of tenants, we are going to ensure that there is much more collaboration, for example, for French brands that our French colleagues provide the market penetration of those tenants in Belgium or Spain or the Netherlands. We also gave a forecast for the EPRA result between EUR 1.95 and EUR 2.05. That's our outlook for next year, considering all the expenses, for example, the tax expenses, synergies that have been calculated in and then the interest rates for 2025. So I think I just want to close here also with a quote. I think important is that Vastned owns a very unique portfolio in the city centers. We are unique on its own. It's something you cannot have yourself. And I think that if you look further into this portfolio, you will see those shiny diamonds in our portfolio and see the underlying value of Vastned. And I think that is the key message I want to give here as well that we have to look further. I think we have been in the corner where we have been hit over the last years with valuations, with rent decreases, but maybe we are now at the bottom and we can look forward. Now that the structure is also combined, we can go forward and ensure that we have a good story to tell. So that was it from our side. There is some questions for Q&A. I think maybe, [ Amal ], you want to start?

I have a few questions on my side. First on the rental reversion, you mentioned that the rent renegotiations concluded this year were slightly below previous rents. Can you give us an idea of the magnitude? And when you look at your portfolio, how do you compare your actual current trends to what are the current market trends?

So come back first on the actual rent over the current market trends, I think we still see that we are a bit with actual rents above the current market rents. On the other side, we still see that we signed the contracts above market rent always. We had an increase of 7% compared to the ERVs and the market rents that have been set forward. So I think there, we still see that there is some potential because we signed it on better conditions at this moment. And I think we had a small like-for-like increase of 1.2%, [ Amal ]. And the decrease was mainly -- we had an empty unit in Madrid -- Malaga, sorry, that was the main reason for it and as well in the Netherlands, for example, the old former Ted Baker unit. But on the other side, we have had the big impact of the rent renewals, as Barbara mentioned, in Belgium. That was, for example, of contracts that have been indexed over the last 9 years and also had big indexations of almost 10%. So there, we had a small decrease in terms of rent, but still above market trends.

Can you quantify what's the, let's say, share of your portfolio today that is in this situation of, let's say, strong indexations and pushed rents above what is the current market level?

I don't have the number by heart, the percentage, but it's -- I can come back on it later, but most of the contracts have been renewed. For example, if you look to Belgium, all the tenants have a 3-year break option. And so they came to us already for rental renewals at that moment. So I think maybe some, let's say, 5% or 10%, which might be there, if I have to put a number, 5% to 10% might have to come. But again, the question is if the situation looks -- changes, it will have an impact because, for example, in our unit in Madrid, we also had a big increase in turnover rent because the store performs very well. And we have there had an impact of almost EUR 200,000-plus additional rent.

Very clear. And coming back on the bankruptcies, do you have a kind of a watch list of the retailers where you feel there could be a risk of bankruptcies? And how is it evolving?

Yes. So we have indeed a sort of watch list of retailers where we see market signs that they have bit more difficulties. There, we follow up really close the payments they make. And for example, if we see that the payments -- there is a delay in their payment habits, we directly call them and ensure that the payments come in. And of course, we have for almost all our tenants also bank guarantees. Of course, we do not want to withdraw those directly, but -- and try to get it in first instance.

But do you expect additional bankruptcies to happen in 2025 or was 2024 the bigger wave for you?

I think 2024 was already a big wave. Maybe there will be still some in 2025, but I don't think we will see a big wave like in 2024 from bankruptcies. And there, as well, I see we see new brands coming up again, taking in the place of the bankrupt units.

Okay. Last question on my side. You mentioned in your press release that going forward your long-term target in terms of LTV would be around 40%, you're slightly above. How can you reconcile your ambition to grow with this, let's say, target of decreasing LTV? Are you considering any contribution in kind or this, an equity raise?

Yes. So in first instance, growth will be rather on an opportunistic side that we will follow it because we come out of the process of a reverse merger. It is quite a process. We need to align and to focus ourselves first on the operational activities to ensure that the organization is ready because if we are now going to -- directly into the hard growth, we might have the difficulty that the organization will not be following. So we first streamline the organization, ensure that we are ready and then look forward to the future. But of course, if there are very interesting opportunities, we will not hesitate, of course, to go after those opportunities when they can benefit our shareholders going forward.

And the target of 40% is midterm or...

That is indeed midterm. As mentioned also in our press release, we are aiming to decrease it always to a period of within 3 years that we are streamlining to get it back to the 40%. This year has been impacted, of course, due to the payment of the interim dividend that has been done already because that's also already an impact of almost 2% on the debt ratio. And to come back on your question of the contributions in kind, of course, we have the treasury shares, the 3.3 million treasury shares, which are there. I think it's important that was also approved when we approved our bylaws during the Extraordinary General Meeting in 25th of September that if we want to use them, we will first call a shareholders' meeting to let the proof that we can use those shares going forward. But of course, if there are interesting opportunities, we will always have a look how we can ensure that we have the best for our shareholders. Steven, maybe you?

I have several. So maybe also one more on the like-for-like growth. What can we expect for '25? And what is expected in renewals? And also related to that, why is the reported Spanish vacancy still 100% while you have the Malaga vacancy?