PAREF (EPA:PAR) | 2024 FULL-YEAR RESULTS
PAREF’s Ongoing European Expansion and Commitment to Sustainable Growth
PAREF continues to expand its footprint across Europe, ensuring the groundwork is firmly laid for both operational and financial sustainability, thereby paving the way for future successes and advancements.
REIT Activity: Asset Value Growth Amidst Occupancy Challenges
By the end of 2024, PAREF’s real estate portfolio registered a value of €186 million, a 3% increase on a like-for-like basis compared to the end of 2023. This portfolio includes seven key real estate assets and financial investments in group-managed funds.
Despite facing temporary declines in rental income, mostly due to strategic vacancies and tenant turnovers, the portfolio showcased resilience. As of the end of 2024, net rental income from these assets amounted to €7.8 million, a decrease from the previous year. The vacancy challenges at Croissy-Beaubourg and tenant shifts at the Franklin Tower contributed to this decline, though they were somewhat mitigated by rental indexation.
Third-Party Asset Management: Strategic Growth Amid Market Uncertainties
The Group’s subsidiaries, PAREF Gestion and PAREF Investment Management, play pivotal roles in serving both institutional investors and individuals. These entities adeptly navigate the real estate value chain, offering a suite of comprehensive services.
In 2024, significant strides in the European market were made with the management of new funds in Italy, notably with the appointment as fund manager for Fondo Broggi, validating PAREF’s market expertise. However, challenging market conditions halved the SCPI gross subscription inflows.
Despite market fluctuations, PAREF Gestion’s SCPIs maintained robust performance, offering stable subscription prices and a moderate increase in yield.
Strategic Management Mandates
PAREF effectively demonstrated its comprehensive service strategy through the acquisition of a five-year management mandate with Parkway Life REIT, covering 11 nursing home properties in Europe. This mandate underlines PAREF’s capability to provide long-term, integrated support to institutional investors.
SOLIA Paref, the Group’s property management arm, further reinforced its market presence by managing an impressive portfolio across diverse property types, with a recent management mandate secured with Hémisphère for prime real estate in Paris.
Financial Overview
Despite a drop in new fund inflows, management commissions saw a substantial growth of 17%, reaching €18.1 million, largely propelled by new investment commissions. Subscription commissions, however, witnessed a decrease in response to market conditions.
The current operating income of PAREF increased by 34% in 2024, driven by strategic financial management and operational efficiencies. Nonetheless, the EPRA Net Reinstatement Value (NRV) per share saw a slight decline of 5%, due primarily to fluctuations in investment property value and dividend distributions.
Commitment to ESG and Sustainable Practices
PAREF remains steadfast in its commitment to ESG principles, demonstrated by the ongoing integration of its “Create More” strategy across its portfolio. In 2024, PAREF launched a series of notable initiatives aligned with sustainability and transparency standards, earning recognition for its progress.
Decarbonization remains a focal point, with initiatives geared toward reducing the carbon footprint of its properties. Additionally, financing efforts have also seen the introduction of Sustainability Linked Loans, with terms tied to annual carbon performance metrics.
The Group’s community and social initiatives continue to blossom, with holistic development plans and programs such as PAREF4Good, reinforcing its commitment to inclusion, equality, and social responsibility.
2025: PAREF’s Strategic Outlook
Looking ahead, PAREF’s defined growth strategy for 2025 is built on three principal pillars. This strategy emphasizes the Group’s comprehensive understanding of local markets while maintaining a global perspective. PAREF is poised to further fortify its foundations, expand its geographical reach, and enhance its strategic partnerships, all reflecting its dedication to sustainable value creation and growth across all operational levels.
With its impressive 30-year legacy, PAREF’s strategic approach promises to drive forward its commitment to excellence in real estate management, ensuring continued success across its broad spectrum of activities, which include investment, development, and nuanced asset and property management services.
With over €3 billion in assets under management as of the end of 2024, PAREF stands resolute in its pursuit of pioneering growth and sustainable real estate solutions, positioning itself as a standout leader in the European market.
