WOOD Flash - Graphisoft Park: 4Q17 results - beat on higher rental income
Exceeding our 4Q17 forecast on higher rental income, Graphisoft Park continues to offer an appealing FFO yield, and exposure to a portfolio of high-quality assets, in a tranquil location beside the Danube in northern Budapest. We like the company’s unique business model. Its long relationships with key tenants, such as SAP and Microsoft, suggest that such companies are happy to pay premium rents to please their employees. That said, from this year onwards, the properties are going to be valued externally, and Graphisoft will start to record them at FV in its books, we understand. On the portfolio valuation, we are somewhat more conservative than management, especially when it comes to the valuation of the landbank, and we pencil NAV at EUR 138m as of the end of 2018E (vs. EUR 184m as of end-2017). As such, we believe that the room for further rerating is limited, and we view the shares as fairly valued at these levels.Graphisoft Park SE Ingatlanfejleszto Europai Rt is a Hungary-based company engaged in the real estate operations. The Company operates as a holding and provides management, financial and administrative services to its subsidiaries. As of December 31, 2011, the Company operated two subsidiaries, Grpahisoft Park Kft, engaged in the real estate development; and Graphisoft Park Services Kft, responsible for property operation tasks. The total area of the Company's properties was nearly 18 hectares. As of December 31, 2011, the Company's two subsidiaries, Graphisoft Park Universitas Kft and GP3 Kft merged into Graphisoft Park Kft. As of December 31, 2011, the Company's parent entity was Graphisoft SE.
WOOD & Company is the leading investment bank in Emerging Europe. Founded in 1991 and head-quartered in Prague, our footprint spans the region and touches investors around the globe.
A pioneer in Emerging Europe, WOOD executed many of the first CEE equity trades and landmark investment banking transactions. Our electronic trading platform was the first in the region, and remains the best. We are continually expanding our relevance and reach in these ever-evolving markets.
Our equity market share reflects our stature: 7% in Warsaw, 20% in Bucharest, 16% in Hungary, 40% in Prague and 5% in Vienna. Our distribution is unparalleled, with the largest salesforce in the region, servicing a uniquely diverse investor base.
We couple local expertise with a truly international perspective. With offices on the ground in the region, and in key financial hubs such as London and Milano, we are never far from our clients and we remain at the forefront of what’s afoot in the CEE emerging and frontier landscape.
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