Vesteda Group

History

Vesteda was established as a result of a restructuring of ABP’s real estate portfolio. For some years now, the ABP Stichting Pensioenfonds (Pension Fund organisation) has implemented a strategy focused on realising a greater diversification and increased liquidity for its real estate portfolio. In line with this strategy, a decision was taken to convert its direct participation in real estate into a minority interest in sector-based real estate investment firms. As a result of this decision, ABP’s Woningfonds (Housing Fund) became an independent business unit and Vesteda was established in 1998. A brief description is given below of its history since its establishment until the present.

2009

In 2009, Vesteda started preparations for the ‘Horizon Vesteda 2012-2020’ project with an initial exploration, along with shareholders, of the shape of the period after 2012. The Letting portfolio was revalued downward by 6.6% as a result of the credit crisis and associated standstill of the housing and property financing markets. A provision of €65 million was formed for future project losses. The benchmarks for both direct and indirect returns were, however, beaten. Although lower, at 95.3%, the occupancy rate remained well up to the mark compared with other property investments in the market. Vesteda’s structure was revised, creating greater flexibility compared with financing opportunities. In total 1,100 homes flowed out of the Letting portfolio, against an inflow of 700 homes.

2008

In 2008, for the first time in Vesteda’s existence, the value of the portfolio had to be readjusted downwards. In total, the management portfolio decreased by 2.4% as a result of revaluation, i.e. by €116 million. The leverage effect had a negative impact, resulting in a total return on equity capital of -3.1%. This was not a very good result in comparison to the prognosis for 2008 and Vesteda’s track record, but at the same time it was relatively positive in comparison to other investments such as stocks, raw materials, private equity, hedge funds, infrastructure and riskier bonds as well as other sectors within the real estate investment sector such as offices and shops and in comparison to real estate investments elsewhere in Europe.

2007

In 2007, €320 million worth of shares were reassigned. Three new shareholders were welcomed, and outside assets increased by €350 million. A total of 1600 homes were added to the portfolio, 1050 of which were acquired by purchasing a portfolio. Approximately 1250 homes were sold. In 2007, the balance total exceeded €5 billion for the first time.

2006

In 2006, the portfolio was reduced to a total of 28,000 units. The strategy was refined in more detail, and the model portfolio, which sets out the guidelines for investment policy until 2015, was modified. The total return realised on equity capital was 14.7%, which was the highest realised over the last five years.

2005

In 2005, the organisational consolidation continued. The number of new homes being rented out increased. In July, the entire asset capital was refinanced.

2004

2004 was marked by ongoing organisational consolidation after several years of growth. The influx of finished homes supplied by Vesteda project bv started to increase quite rapidly, resulting in a significant increase in the number of new homes being rented out. In April, partial refinancing was realised for an amount of €400 million.

2003

In 2003, Vesteda took a major step on its long-term organisational growth path whereby the property management activities, which had previously been outsourced to external parties, were brought in-house. A total of approximately 100 people were hired, causing the workforce to grow very significantly. By the end of 2003, Vesteda was servicing over 90% of the management portfolio via its own branch offices.

2002

In 2002, ING Real Estate acquired a 25% share in Vesteda. Shortly thereafter, agreements were signed with six other institutional investors whereby they obtained a total share of 13%. The remaining shares held by ABP were equal to 62% of the total. The outside assets were refinanced in the form of three long-term bonds with terms of three to seven years. Vesteda was able to borrow €1.4 billion from the capital market. For the financial transactions, Vesteda was awarded an AAA rating by the three largest credit rating agencies.

2001

2001 was marked by the preparations for a range of transactions. An information memorandum was released, which enabled a large group of institutional investors to participate in Vesteda. Restructuring activities were also carried out with respect to legal and tax-related aspects, which allowed third parties to actually participate in the new company. Approximately 30% of the equity capital was converted into outside assets in preparation for the definitive financing by external parties. Internally, a reorganisation was completed in line with the chosen strategy. In December 2001, Vesteda Project bv was established.

2000

In 2000, client-specific information in combination with social-demographic projections led to a division of the portfolio into a Core portfolio and a Disinvestment portfolio. The Disinvestment portfolio ended up containing approximately 30% of the homes. In addition, a steering committee was formed in 2000, within which Vesteda management and ABP, in its role as shareholder, worked out and implemented the strategy which resulted in the transition from a situation in which ABP was the only shareholder to one in which it had a minority share. It was decided to structure the new company in the form of a private company open to investments by institutional investors.

1999

In 1999, Vesteda’s strategy became more sharply focused. Increasing specialisation in the more expensive rental sector marked the start of the changing product development activities and organisation.

1998

Establishment of Vesteda.