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Noval Property | Growth under construction, value still undiscovered

Revisions on project timelines; steady growth outlook intact – Noval Property (NP) delivered a solid H1’25 performance, with rental income up 11% yoy to €17.7mn and adj. EBITDA rising 17% yoy to €11.0mn, driven by indexation gains, turnover rents and new leases. Following an update to project phasing, we have slightly trimmed our forecasts to reflect later contributions of some projects, partly offset by lower operating and financing costs, leaving our near-term adj. net profit forecasts little-changed. For 2025e we now expect rental income of €37.1mn (-2% vs previously) and adj. EBITDA of €22.7mn (-2%). We expect NAV to settle at €549mn, while envisaging c4% CAGR through to 2030e, reiterating the long-term value creation trajectory.

€290m pipeline leveraging on landbank – NP is executing a €290mn investment plan for 2025–31e, primarily focused on the development of its own landbank, which remains its key comparative advantage, enabling value creation without the twin risks of acquisition premium and yield compression. The updated plan incorporates revised delivery timelines for major projects, including THE GRID (set to begin ops in 2026), the Kifisias Av. offices (completion in early 2026), and the Piraeus Str. urban regeneration project, delayed by 1 year. Most investments relate to developments on Noval’s existing landholdings, expected to generate c€28mn in annualized rental income by 2031 on our estimates, while c€59mn is allocated to selective acquisitions. Overall, we forecast c10% rental CAGR over 2024–30e, driven by the pipeline and indexation, with additional upside from turnover-linked rents in retail and hospitality properties.

Low leverage acts as firepower for portfolio growth; c4% NAV CAGR through to 2030 – Noval remains well positioned to fund its investment plan, supported by ample balance sheet flexibility. Net LTV stands at 20.4%, vs c40% EU avg, with an average cost of debt at c3%. We expect leverage to rise gradually from 2027 but peak LTV should not exceed c35%, still comfortably below European norms. We forecast GAV growth of 6% CAGR through 2030, reaching c€930m, with most of the increase (c80%) stemming from the investment program and the remainder from revaluations. This will translate to c4% NAV CAGR, on our estimate, given the disciplined 50% FFO payout policy. Trading at a c40% discount to NAV, the stock screens attractively for a c9-10% annual total return (NAV + dividend), offering asymmetric upside underpinned by a clean balance sheet and long-cycle growth. We rank Noval among our top picks in the Greek REIC space, along with Trade Estates.

Valuation – Noval has returned c15% YTD, yet it continues to trade at a wide c39% discount to 2025e NAV, despite its strong balance sheet, visible growth pipeline, and consistent operating delivery. Our PT of €3.53/share is based on a 20% discount to 2026e adjusted NAV (ex-revaluations), slightly above the cross-cycle EU REIT average of c15% and broadly in line with the EU sector’s current valuation. We reiterate our Buy recommendation, seeing scope for re-rating as project completions accelerate and NAV growth crystallizes over the medium term.