3Q17 results in line
3Q17 results were in line with our estimates for the full year. Occupancy rates improving by 40bp to 94.7% in 3Q17 (93.8% retail, 92.8% offices and 100% Logistics). Lar Españas’s retail assets continue to show strong fundamentals with footfall and sales increasing by 1.9% and 2.7% YTD, respectively.
Lar España’s NFD fetched €528.3Mn at September 2017, implying a LTV of 37%. We expect a LTV of 42.3% by the end of 2017e.
We maintain our Buy recommendation with a target price of €10.1/share
Lar España trades at €8.0/share, that implies a 15.9% discount to its EPRA NAV (€9.51/share in September 2017) and a 20.8% discount to our valuation (€10.1/share). We maintain our Buy rating.
Lar Espana Real Estate SOCIMI SA is a Spain-based company primarily engaged in the operation of retail Real Estate Investment Trusts (REITs). The Company specializes in acquiring, managing and renting real estate assets within the Spanish market. Its business activities are divided into three segments: Shopping Centers, Offices, as well as Logistics. The Shopping Centers area is responsible for operation of a number of shopping malls, namely Txingudi, Las Huertas, Albacenter, Anec Blau, Hiper Albacenter, and Nuevo Alisal, among others. The Offices segment invests in office properties, such as Arturo Soria, Cardenal Marcelo Spinola, Egeo and Eloy Gonzalo. The Logistics division focuses on managing logistics warehouses, including Alovera I and Alovera II. The Company also owns a plot for residential properties development. It is a parent of a number of entities, such as Lar Espana Inversion Logistica SA, Gran Via Centrum Holdings SAU, Global Noctua and Puerta Maritima Ondara.
Bankinter S.A. is a Spanish brokerage firm established in 1989. The company's line of business includes the provision of market research and trading services for Equity and Fixed Income products.
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