► Acceleration of industrial growth capex program; acquisition
of strategic, 25-hectare, industrial land bank in Monterrey to
develop 906 thousand square feet of GLA
► Record quarterly results for consolidated revenue and NOI, in
underlying US dollar terms
► 1Q24 NOI up 10.2% YoY in underlying USD terms
► Quarterly Industrial leasing renewal spreads of 11.8% on
negotiated leases
► 1Q24 distribution of Ps. 0.5250 per certificate declared, up
10.1% YoY in underlying USD terms
► FY24 AFFO per certificate and distribution guidance
reaffirmed
FIBRA Macquarie México (FIBRAMQ) (BMV: FIBRAMQ) announced its
financial and operating results for the first quarter ended March
31, 2024.
FIRST QUARTER 2024 HIGHLIGHTS
- Consolidated 1Q24 NOI up 10.2% YoY, in underlying USD
terms
- Consolidated 1Q24 AFFO up 4.0% YoY, in underlying USD
terms
- Consolidated 1Q24 portfolio occupancy of 97.3%
- Quarterly retail foot traffic above pre-pandemic levels for the
first time
- Cash distribution of Ps. 0.5250 per certificate declared for
1Q24
“We achieved another quarter of strong growth as we adhere to
our core focus of maintaining a high-quality, well-located
portfolio, and disciplined capital allocation. With a backdrop that
continues to be supported by nearshoring tailwinds, we remain
optimistic in our positioning and ability to continue to deliver
accretive growth,” said Simon Hanna, FIBRA Macquarie’s chief
executive officer. “With these favorable drivers we are pleased to
have realized record consolidated revenue and robust rental rate
increases as we see ongoing demand for industrial space in our key
northern Mexico markets, leading to a 10.1% YoY increase in our
distribution per certificate, in underlying USD terms.
Additionally, our retail portfolio has demonstrated ongoing
momentum, and during the first quarter we saw a meaningful rebound
in foot traffic to pre-Covid levels for the first time,
contributing to a sustained and ongoing recovery.”
Mr. Hanna continued, “We see a compelling opportunity to
leverage our platform to further accelerate our growth in the
coming years. Subsequent to quarter end, we acquired a strategic 25
hectare land parcel in the core industrial market of Monterrey, and
we look forward to commencing works to continue to capitalize on
the strong demand environment.”
CAPITAL ALLOCATION
FIBRAMQ continues to pursue a strategy of investing in and
developing class “A” industrial assets in core markets that
demonstrate strong performance and a positive economic outlook.
Industrial Portfolio Growth Capex Program
FIBRAMQ has 1.5 million square feet of GLA under development or
stabilization with a total investment of approximately US$126
million.
There is an expected capital deployment of US$108 million
remaining over the next twelve months (this includes remaining
building construction costs, contracted tenant improvements as well
as consideration for land, including our recent acquisition in
Monterrey, and certain project-wide infrastructure costs for all
development projects). FIBRA Macquarie maintains a target NOI yield
on cost of between 9% and 11% on its industrial development
program, which incorporates the highest sustainability standards
and is designed to generate embedded operational efficiencies for
its customers.
Projects in process are summarized below. For further details
regarding recently delivered projects, please refer to the
Supplementary Information materials located at BMV Filings
(fibramacquarie.com).
Monterrey Metropolitan Area, Nuevo
Leon
- On April 19, 2024, FIBRAMQ completed the acquisition of a 25
hectare land parcel in Monterrey for US$12.4 million, excluding
transaction costs and taxes.
- The land parcel is strategically positioned near Monterrey’s
International Airport and approximately 1.5kms from FIBRAMQ’s
Apodaca Industrial Park.
- The long-term development plan for this parcel anticipates a
phased, multi-year construction of a multi-building Class A
industrial park, with a total potential GLA of approximately 906
thousand square feet.
Projects in Process
Apodaca, Nuevo Leon
- FIBRAMQ is constructing an additional property comprising 200
thousand square feet of GLA, with an expected completion during
2Q24.
- This class “A” industrial park is anticipated to comprise a
total potential GLA of 790 thousand square feet, of which FIBRAMQ
has in progress or completed construction of 590 thousand square
feet of GLA.
Tijuana, Baja California
- Works are ongoing for the first building comprising 405
thousand square feet of GLA with an updated expected delivery date
in the second half of 2024.
- This class “A” industrial park is anticipated to comprise a
total potential GLA of 890 thousand square feet.
FINANCIAL AND OPERATING RESULTS
Consolidated Portfolio
FIBRAMQ’s consolidated 1Q24 results were as follows:
TOTAL PORTFOLIO
1Q24
1Q23
Variance
1Q24
1Q23
Variance
Net Operating Income (inc. SLR)
Ps. 952.9m
Ps. 950.4m
0.3%
US$ 56.1m
US$ 50.8m
10.3%
Net Operating Income (exc. SLR)
Ps. 958.4m
Ps. 956.7m
0.2%
US$ 56.4m
US$ 51.2m
10.2%
EBITDA
Ps. 864.1m
Ps. 877.6m
(1.5%)
US$ 50.8m
US$ 46.9m
8.4%
Funds From Operations (FFO)
Ps. 614.1m
Ps. 640.8m
(4.2%)
US$ 36.1m
US$ 34.3m
5.5%
FFO per certificate
Ps. 0.7991
Ps. 0.8418
(5.1%)
US$ 0.0470
US$ 0.0450
4.5%
Adjusted Funds From Operations (AFFO)
Ps. 489.3m
Ps. 517.6m
(5.5%)
US$ 28.8m
US$ 27.7m
4.0%
AFFO per certificate
Ps. 0.6368
Ps. 0.6799
(6.3%)
US$ 0.0375
US$ 0.0363
3.1%
NOI Margin (inc. SLR)
85.7%
87.1%
(140 bps)
85.7%
87.1%
(140 bps)
NOI Margin (exc. SLR)
86.2%
87.7%
(149 bps)
86.2%
87.7%
(149 bps)
AFFO Margin
44.0%
47.4%
(343 bps)
44.0%
47.4%
(343 bps)
GLA (’000s square feet) EOP
35,575
35,055
1.5%
35,575
35,055
1.5%
GLA (’000s sqm) EOP
3,305
3,257
1.5%
3,305
3,257
1.5%
Occupancy EOP
97.3%
97.3%
7 bps
97.3%
97.3%
7 bps
Average Occupancy
97.2%
96.9%
23 bps
97.2%
96.9%
23 bps
Industrial Portfolio
The following table summarizes 1Q24 results for FIBRAMQ’s
industrial portfolio:
INDUSTRIAL PORTFOLIO
1Q24
1Q23
Variance
1Q24
1Q23
Variance
Net Operating Income (inc. SLR)
Ps. 812.2m
Ps. 824.4m
(1.5%)
US$ 47.8m
US$ 44.1m
8.4%
Net Operating Income (exc. SLR)
Ps. 816.6m
Ps. 822.7m
(0.7%)
US$ 48.0m
US$ 44.0m
9.2%
NOI Margin (inc. SLR)
88.9%
90.4%
(144 bps)
88.9%
90.4%
(144 bps)
NOI Margin (exc. SLR)
89.4%
90.2%
(77 bps)
89.4%
90.2%
(77 bps)
GLA (’000s square feet) EOP
30,947
30,452
1.6%
30,947
30,452
1.6%
GLA (’000s sqm) EOP
2,875
2,829
1.6%
2,875
2,829
1.6%
Occupancy EOP
98.2%
98.2%
1 bps
98.2%
98.2%
1 bps
Average Occupancy
98.0%
97.8%
21 bps
98.0%
97.8%
21 bps
Average monthly rent per leased (US$/sqm)
EOP
US$ 5.97
US$ 5.63
6.1%
US$ 5.97
US$ 5.63
6.1%
Customer retention LTM
88.9%
92.5%
(360 bps)
88.9%
92.5%
(360 bps)
Weighted Avg Lease Term Remaining (years)
EOP
3.4
3.2
4.0%
3.4
3.2
4.0%
FIBRAMQ’s industrial portfolio performance remains robust, with
continued increases in occupancy and average rental rates. For the
quarter ended March 31, 2024, FIBRAMQ’s industrial portfolio
delivered quarterly NOI of US$48.0 million, a 9.2% annual increase.
At quarter-end, occupancy was 98.2%. New leasing activity comprised
128 thousand square feet of GLA and quarterly moveouts were 96
thousand square feet. Renewal and new leases featured a cardboard
packaging manufacturer in Monterrey and an auto parts warehousing
facility in Saltillo. Renewal leases comprised 8 contracts across
541 thousand square feet, driving a solid retention rate of 88.9%
over the last 12 months.
Retail Portfolio
The following table summarizes the proportionally combined 1Q24
results for FIBRAMQ’s retail portfolio:
RETAIL PORTFOLIO
1Q24
1Q23
Variance
Net Operating Income (incl. SLR)
Ps. 140.6m
Ps. 126.0m
11.6%
Net Operating Income (excl. SLR)
Ps. 141.7m
Ps. 134.0m
5.8%
NOI Margin (%, inc. SLR)
70.7%
70.3%
42 bps
NOI Margin (%, exc. SLR)
71.3%
74.8%
(349 bps)
GLA (’000s square feet) EOP
4,629
4,603
0.6%
GLA (’000s sqm) EOP
430
428
0.6%
Occupancy EOP
91.4%
91.0%
41 bps
Average Occupancy
91.2%
91.0%
25 bps
Average monthly rent per leased sqm
EOP
Ps. 179.60
Ps. 169.69
5.8%
Customer retention LTM
87.3%
82.1%
523 bps
Weighted Avg Lease Term Remaining (years)
EOP
3.5
3.1
13.8%
- Total revenues were Ps. 198.9 million, up 11.0% over the prior
corresponding quarter
- Retail portfolio cash collections during the quarter trended up
to Ps. 196.7 million, an increase of 2.1% versus the prior
corresponding period
- Over the last twelve months, weighted average lease term
remaining increased by 13.8% alongside an increase in average rents
of 5.8%, reflecting improved leasing conditions
- During the first quarter, recorded foot traffic at FIBRAMQ’s
shopping centers was approximately 4.0% above the prior comparable
period, and was above pre-pandemic levels by 1.0%
FIBRAMQ signed 79 new and renewal leases during the quarter
totaling 27.4 thousand square meters of GLA, across a diverse range
of tenants including a cinema, a gym and a hotel. With this strong
leasing activity, the Retail portfolio benefited from strong
retention of 87.3% over the last twelve months.
As of March 31, 2024, trade receivables net of provisions were
Ps. 9.2 million (excl. VAT), stable over the prior corresponding
period.
Lease Rental Rate Summary
Based on annualized base rents, FIBRAMQ’s consolidated lease
portfolio is now 65.7% linked to either Mexican or US CPI,
representing an increase of 592 bps over the last twelve
months.
In the industrial portfolio, FIBRAMQ achieved a weighted average
positive releasing spread of 11.8%, in respect of leases generating
US$21.3 million of annualized base rent.
For further details about FIBRA Macquarie’s First Quarter 2024
results, please refer to the Supplementary Information materials
located at BMV Filings (fibramacquarie.com).
BALANCE SHEET
As of March 31, 2024, FIBRAMQ had US$1,014.6 million of debt
outstanding, US$307.9 million available on its undrawn committed
revolving credit facility and US$32.1 million of unrestricted cash
on hand.
FIBRAMQ’s indebtedness is 88.7% fixed rate, with 3.9 years of
weighted average term remaining. FIBRAMQ’s does not have any of its
debt maturing before September 2026.
FIBRAMQ’s CNBV regulatory debt to total asset ratio was 30.5%
and debt service coverage ratio was 5.6x.
CERTIFICATE REPURCHASE PROGRAM
FIBRAMQ has a Ps. 1,000 million CBFI repurchase-for-cancellation
program available through to June 25, 2025. No certificates were
repurchased during the quarter.
SUSTAINABILITY
At 31 March, 2024, FIBRA Macquarie’s green building
certification coverage represented 39.9% of consolidated GLA.
Sustainability and green financing linked portion of drawn debt
stands at 61.1%.
DISTRIBUTION
On April 25, 2024, FIBRAMQ declared a cash distribution of Ps.
0.5250 per certificate for the quarter ended March 31, 2024. The
distribution is expected to be paid on or about June 17, 2024, to
holders of record on June 14, 2024. FIBRAMQ’s certificates are
expected to commence trading ex-distribution on June 14, 2024.
FY24 GUIDANCE
AFFO
FIBRA Macquarie is reaffirming its FY24 AFFO per certificate
guidance of Ps. 2.55 to Ps. 2.60.
The FY24 AFFO guidance equates to a range of US$116 million to
US$120 million, representing an annual increase of between 6% and
8% in underlying USD terms.
FIBRAMQ maintains a positive 2024 outlook on operational
performance translating to increased revenue and NOI which is
expected to be offset by a combination of the continued impact of
Peso appreciation relative to the US Dollar, as well as the
financing costs of near-term investments in FIBRAMQ’s industrial
growth capex program, which is expected to incrementally contribute
to revenue and AFFO growth upon stabilization of each development
project. This guidance assumes:
- an average exchange rate of Ps. 17.30 per US dollar for the
remainder of 2024;
- no new acquisitions or divestments;
- no deterioration in broader economic and market
conditions.
Cash Distribution
FIBRAMQ is reaffirming guidance for cash distributions in FY24
of Ps. 2.10 per certificate, paid in equal quarterly instalments of
Ps. 0.5250 per certificate.
The FY24 cash distribution guidance equates to approximately
US$97.4 million, representing an annual increase for scheduled
distributions of 8.6% in underlying USD terms.
The guidance implies an expected FY24 AFFO payout ratio of
approximately 82%, based on the AFFO guidance midpoint. The payment
of distributions is subject to the approval of the Manager, stable
market conditions and prudent management of FIBRAMQ’s capital
position.
Outstanding certificates
FIBRA Macquarie had 797,311,397 outstanding certificates as of
March 31, 2024. This considers the 36.0 million certificates
issuance to existing holders that was made in March 2024 in respect
of the extraordinary distribution corresponding to FY23, resulting
in a 4.7% increase in outstanding CBFIs.
WEBCAST AND CONFERENCE CALL
FIBRAMQ will host an earnings conference call and webcast
presentation on Friday, April 26, 2024, at 11:00 a.m. CT / 13:00
p.m. ET. The conference call, which will also be webcast, can be
accessed online at www.fibramacquarie.com or by dialing toll free
+1-877-407-2988. Callers from Mexico may dial 01-800-522-0034 and
other callers from outside the United States may dial
+1-201-389-0923. Please ask for the FIBRA Macquarie First Quarter
2024 Earnings Call. An audio replay will be available by dialing
+1-877-660-6853 or +1-201-612-7415 for callers from outside the
United States. A webcast archive of the conference call and FIBRA
Macquarie’s financial information for the first quarter 2024 will
also be available on FIBRAMQ’s website, www.fibramacquarie.com.
About FIBRA Macquarie
FIBRA Macquarie México (FIBRA Macquarie) (BMV:FIBRAMQ) is a real
estate investment trust (fideicomiso de inversión en bienes
raíces), or FIBRA, listed on the Mexican Stock Exchange (Bolsa
Mexicana de Valores) targeting industrial, retail and office real
estate opportunities in Mexico, with a primary focus on stabilized
income-producing properties. FIBRA Macquarie’s portfolio consists
of 239 industrial properties and 17 retail properties, located in
20 cities across 16 Mexican states as of March 31, 2024. Nine of
the retail properties are held through a 50/50 joint venture. For
additional information about FIBRA Macquarie, please visit
www.fibramacquarie.com.
Cautionary Note Regarding Forward-looking Statements
This release may contain forward-looking statements.
Forward-looking statements involve inherent risks and
uncertainties. We caution you that a number of important factors
could cause actual results to differ significantly from these
forward-looking statements and we undertake no obligation to update
any forward-looking statements.
Other than Macquarie Bank Limited ABN 46 008 583 542 (“Macquarie
Bank”), any Macquarie Group entity noted in this document is not an
authorized deposit-taking institution for the purposes of the
Banking Act 1959 (Commonwealth of Australia). The obligations of
these other Macquarie Group entities do not represent deposits or
other liabilities of Macquarie Bank. Macquarie Bank does not
guarantee or otherwise provide assurance in respect of the
obligations of these other Macquarie Group entities. In addition,
if this document relates to an investment, (a) the investor is
subject to investment risk including possible delays in repayment
and loss of income and principal invested and (b) none of Macquarie
Bank or any other Macquarie Group entity guarantees any particular
rate of return on or the performance of the investment, nor do they
guarantee repayment of capital in respect of the investment.
THIS RELEASE IS NOT AN OFFER FOR SALE OF SECURITIES IN THE
UNITED STATES, AND SECURITIES MAY NOT BE OFFERED OR SOLD IN THE
UNITED STATES ABSENT REGISTRATION OR AN EXEMPTION FROM REGISTRATION
UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED.
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