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ACROSS Retail Realestate Magazine

Echo summarises the year of positive changes

Transformation from being the owner of standing assets to pure developer, considerable acceleration of development and leasing activity, high growth in apartment sales and focus on delivering return to the shareholders – these are Echo Investment’s 2016 highlights.

The company successfully implemented the strategy of profitable growth and it is ready to establish long-term dividend policy.

Nicklas Lindberg, Echo Investment CEO. Image: Echo
Nicklas Lindberg, Echo Investment CEO. Image: Echo

One of the major pillars of the profitable growth strategy is to accelerate the capital turnover. The results are proven by numbers. Last year Echo Investment started projects of nearly 200,000 sq m of office, residential and retail space, and completed almost 170,000 sq m. That is twice as much as in 2015.

The leasing teams increased the leased area by 80% in office sector and by 30% in retail. Residential sales teams encouraged clients to buy 925 apartments, which is 56% more as compared to the previous year.

“In 2016, Echo Investment became a pure developer. Based on our standing assets, we created Echo Polska Properties, attracted a respectable co-investor to the new company and successfully listed it on Luxembourg and Johannesburg stock exchanges. Later, we sold Q22 to Invesco Real Estate and three office buildings to EPP, at the total price of EUR 397 million. Sales of almost entire commercial property pipeline for 2017 and 2018 has been already secured by preliminary agreements with the ultimate owners. This gives us very stable outlook for future business growth and return delivering,” says Nicklas Lindberg, Echo Investment CEO.

Echo’s pipeline of projects for 2017 is impressive. The company intends to launch construction of projects with combined office, retail and residential area totalling 182,000 sq m, and to complete over 150,000 sq m. of space in these sectors.

Image: Echo Investment
Image: Echo Investment

“Echo Investment is a stable and experienced company, and has the ability to develop projects in retail, office and residential sectors, including big-scale, mixed-use investments like Browary Warszawskie or Galeria Libero in Katowice. Such projects fit our strategy as well as help to accelerate capital turnover and optimise our resources,” added Nicklas Lindberg.

The company’s pipeline secures projects to be started until 2019, but Echo continues negotiations regarding new plot acquisitions.

“Since the beginning of 2016, we have bought several plots, which will be used to develop 123,000 sqm of residential, office and retail space. We are also well advanced in negotiations regarding acquisitions of areas with potential to build over 500,000 sqm. These activities, together with Towarowa 22 and Galeria Młociny projects that we are going to develop with EPP, secure the implementation of our investment plan for the next few years,” adds Nicklas Lindberg.

Last year was very profitable also for the company’s shareholders. For the first time in its history Echo Investment shared profits with its investors. The total return on Echo’s shares in 2016 amounted to 62%, together with the share price and dividends paid or declared.

“Having secured the sale of almost all projects in the pipeline, the management board decided to adopt the dividend policy. For 2017 profit, Echo Investment will pay the shareholders PLN 0.5 per share, and after that – up to 70% of the net profit will be shared. The remaining amount of the profit will become a foundation for the company future growth. We want Echo Investment to be a stable and attractive investment target,” concludes Maciej Drozd, Echo Investment CFO.

Nicklas Lindberg, Echo Investment CEO about Echo´s year 2016

Video: Echo | Youtube


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