Aedifica Model update: A growth formula in transitional times
In this model update, we lower the net capex to account for the guided 150m divestments. We expect that the divestments keep the debt-to-assets ratio at 45% including 40 bps yield expansion and without further capital increases FY23. The 40 bps yield expansion impacts the fair value of the portfolio by approx. 4%. The effect accelerates over 2H23 as we expect an inflation slowdown to impact ERV. We increase the average cost of debt from 2.2% in FY23 (+80 bps FY22) to 2.4% in FY25. The FBI reimbursement for the years 2016-2020 of EUR 6.1m compensates rising interest costs in FY23. Despite the inflationary environment, we increase the REBIT margin by 2.6%. to reflect economies of scale. We lower the TP slightly to EUR 101.0 (prev. EUR 104). Given the approx. 28% upside, we change our rating from ACCUMULATE to BUY.Aedifica is a property company, which is specialized in residential real estate. Co.'s portfolio has a superstructure of more than 225,911 sq. m as of June 30 2010. It owns: residential or mixed buildings in Belgian cities with classical leases; buildings with furnished apartments buildings in the heart of Brussels with shorter term leases; senior houses and serviceflats with very long term and triple net leases; and hotels. Co. invests: in existing and already leased buildings; and in projects with future completion. Co.'s activities can be divided into four segments: Residential or mixed buildings; Furnished apartments buildings; Senior houses; and Hotels and others.
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