Article posted on : 27/07/2022

2022 Half-Year Results – Société de la Tour Eiffel begins the initial stages of its transformation


– The Board of Directors of Société de la Tour Eiffel, meeting on 27 July 2022, approved the financial statements as at 30 June 2022. The audit procedures for these financial statements have been completed, and the corresponding reports are in the process of being issued.

Christel Zordan, Chief Executive Officer of Société de la Tour Eiffel, said: “With its sight set firmly to the future, Société de la Tour Eiffel is undertaking the first stages of its transformation plan by adopting a roadmap and implementing an internal organisational set-up suited to its new goals, including strengthening its investment and development teams. Despite some noteworthy signings, the company still faces some major letting challenges as it seeks to rebuild its cashflows and dividend payout capacity, based on its size and planned vacancies in order to further its redevelopment goals. The transformation of its portfolio, with a focus on asset classes and locations suited to new societal challenges, will require a transition phase before shareholders see the benefits of this new model. Based on progress already made, I am confident in our ability to implement this roadmap efficiently over time.

Fundamentals still solid…

  • 97% of H1 2022 rents collected to date
  • €5.8m in new leases signed
  • Asset value stable like-for-like (+0.1%) at €1.79bn
  • €27m in disposals carried out, with a view towards transforming the portfolio
  • LTV still conservative at 37.9%
  • Cash and cash equivalent: €178m
  • EPRA NTA per share: €49.8
  • EPRA NDV per share: €51.8
  • Net Initial yield EPRA topped-up: 4.0%

… with a view towards adapting the model in order to return to growth

  • EPRA occupancy rate: 77.5%
  • Consolidated net income: -€1.5m (vs. -€0.4m)
  • EPRA earnings per share: €0.5
  • Recurring cash flow per share: €0.6
Market context and environmental challenges

While the Covid-19 epidemic appeared to have subsided in the first half of 2022, new uncertainties emerged in an economic context marked by high inflation and the prospect of higher interest rates, along with a worsened geopolitical environment. As of 30 June 2022, these new market conditions were expected to have a limited impact on the Group with regard to its business, its office building portfolio, and its financing structure.

Aware that the value of its portfolio depends, among other things, on its environmental performance, and while holding itself to the highest CSR standards, Société de la Tour Eiffel continues its actions in favour of real estate that is more environmentally and societally responsible. It has done so for more than 10 years through an expert dedicated team whose mission is to identify and anticipate current and future challenges and to steer the Group’s ESG strategy accordingly.

Creation of an ESG-specialised committee

As a natural extension of the Group’s CSR efforts, the Board of Directors has supplemented its governance set-up by creating last April an Environmental, Social and Governance (ESG) Committee. This specialised committee consists of four members: SMA SA (represented by Fabienne Tiercelin), Jacques Chanut, Imperio Assurances and Capitalisation (represented by Marie-George Dubost) and Christine Sonnier, an independent director, who chairs the committee.

Start-up of the roadmap

To align itself with current rapid societal trends, in March 2022 Société de la Tour Eiffel announced a new roadmap to adapt its portfolio towards new types of assets and geographical diversification in major regional French cities.

The Group’s change of direction is being accomplished using several leverages, including the disposal of buildings that are no longer suited to the Group’s new challenges, internal developments (some already identified and others for the future), improved environmental performance of buildings, and investments in assets that are in tune with their market.

Disposal of buildings not suited to the Group’s challenges

Despite the clear slowdown in the investment market generally and the specific circumstances of assets awaiting sale, which are often located in illiquid markets, the Group was able to complete the disposal of two properties in the first half of 2022 for €27m at prices in line with the latest appraised values.

On 8 July 2022, the Group signed a promise of sale of a 637 m² property in Coulommiers, in Paris’ eastern suburbs.

Identifying current and future internal developments

As previously announced, the Group is taking advantage of the freeing up of the Lyon Dauphiné and Puteaux (previously Olympe) sites to redevelop them. In Lyon, a permit application to develop an office/co-living building (with 5,000 m² and 5,500 m² for each use, respectively) was filed and then obtained (purged of all recourse) in early 2022. The coliving building was secured with the signing of a 12-year off-plan lease agreement (BEFA) with a specialised operator building. At Puteaux, on the banks of the river Seine, the Group completed the pre-approval process and filed for a permit to build a 9,700 m² office building.

At the Aubervilliers site, which was freed up in late 2021, an ambitious development operation is under review, in accordance with the roadmap’s mixed-use objective. In the meantime, the site is welcoming a temporary tenant for two years (since February 2022) – Poush, France’s first ever artist incubator project – turning it into an innovative, creative, cultural space that will help project the image of Aubervilliers and the Greater Paris area.

On an available plot at the Parc Eiffel Nanterre Seine, in Paris’ western suburbs, the Group filed and obtained a building permit (in the process of being purged of third-party recourse) to develop a 5,200 m² urban logistics building.

At the Parc du Golf in Aix-in-Provence, a permit has been obtained and freed of all claims to build two office buildings with a total surface area of 3,900 m² and is now being pre-let. And in Bobigny in late 2021 the Group acquired a plot adjoining their existing land that will allow the site to be redeveloped as an urban logistics project.

These six projects are perfect examples of the property company’s value creation strategy and are driving the development plan as administrative authorisations are obtained. In total over the four redevelopment projects, it’s €5.8m of potential rental income which have been included in vacancies on purpose.

Investments in properties in phase with their market

Three projects led to sales agreements: two properties rented and restructured in Paris, 920 m² and 2,750 m², as well as a rented sale in future state of completion (VEFA) of 4,400 m² in Issy-les-Moulineaux. These projects are part of the Group’s strategy to transform its portfolio, with a focus on quality locations and high-environmental performance buildings.

A portfolio being transformed…

As of 30 June 2022, property values totalled €1,785m: 82% in offices (€1,472m), 10% in light industrial/logistics premises (€179m), 7% in mixed use (€123m) and, marginally, in managed residential properties. All these properties are located in France, including 76% in Greater Paris (€1,356m). As part of the Group’s ongoing efforts to enhance the quality of its portfolio, 80% of this has been environmentally certified.

…with high rental income stakes…

Deals were signed covering €9.1m in annualised rent during the period, including €5.8m in new leases signed and €3.3m€ rolled over. Driven by the signature with Alcatel (11,700 m²) in Massy in early 2022 and the renegotiation with CS Group (12,200 m²) in Plessis Robinson, the net balance of rental activity came to +€2.2m in annualised rent.

During the first half of the year, more than 56,200 m² in properties was signed. Apart from the two aforementioned deals, the Company contracted for 620 m² with M2DG in Paris-Enghien, for 1,820 m² with Polyexpert Rhône Alpes on the K-Bis in Vaulx-en-Velin, and for 1,240 m² with Work&Share at Delta in Nanterre. In addition, the Centre des Monuments Nationaux, Satelec and Excilone have rolled over or expanded their commitments, respectively, on 3,960 m² at Paris Domino, on 1,330 m² at the Parc Eiffel Nanterre Seine and on 1,055 m² in Elancourt.

As of 30 June 2022, the financial occupancy rate (EPRA) was 77.5% (vs. 75.6% and end-2021), and the average term and firm lease terms were, respectively, 5.4 and 2.9 years (vs. 5.5 and 3.0 at end-2021). Restated for planned vacancies, the occupancy rate was 82.9% (vs. 81.5%).

…and that is productive in occupied properties: 97% of first half 2022 rents have been collected

As of the date of this press release, out of a total of €39.7m of invoiced rents in the first half of 2022, 96.8% have already been collected.

This performance is the fruit of the internalised property and rental management model, combining thorough selection with proximity to tenants to build a quality rental base.

Monitoring of tenant risk on the basis of Coface and Credit Safe ratings continues to indicate that more than 80% of the rental base consists of tenants belonging to the top two categories (low or very-low risk), thus demonstrating its resilience.

EPRA earnings of €0.5 per share impacted by disposals and departures

On a like-for-like basis and when excluding vacancies on purpose, gross rental income declined by 4.8%. In all, it decreased by 12.7% to €39.4m, owing to disposals and departures. Net of charges, rental income declined by 17.7%, in line with the change in the occupancy rate.

Current EBIT came to €21.2m (vs. €29.9m), also reflecting an increase in operating costs (-€1.2m), in accordance with the adjustments made in the Group’s structure.

Financing expenses were stable at €7.3m, reflecting a slight increase in financing costs (1.7% vs. 1.6%), offset by early repayment of loans. This stability in financing fees was made possible by the strategy of hedging existing floating-rate debt, which is expected to continue paying off until December 2024.

After taking into account other income and expenses, taxes and the earnings of companies accounted for using the equity method, EPRA earnings (recurring net profit) stood at €14.1m, or €0.53 per share (after taking into account the cost of perpetual subordinated debt instruments (TSDI) in EPRA earnings per share).

After all EPRA restatement adjustments (allocations, restatements, net gains on disposals and changes in the value of financial instruments), consolidated net income came to -€1.5m, vs. -€0.4m in the first half of 2021.

Recurring Cash Flow for the period totalled €10.6m, or €0.64 per share, vs. 0.97 € in the first half of 2021.

Slight decline in net asset value

EPRA Net Tangible Asset NAV (NTA) per share declined from €50.9 to €49.8 at end-June 2022, due mainly to the payout of the dividend. EPRA liquidation NDV NAV (similar to EPRA Triple Net NAV) per share decreased by an equivalent amount, from €53.0 to €51.8.

Société de la Tour Eiffel undertakes a transformation of its portfolio

After a first-half of the year devoted to defining and adopting a new roadmap and adjusting its structure to meet these objectives, the Group is firmly committed to transforming its portfolio. This is being done by identifying opportunities for divesting properties that do not meet these new expectations, by continuing to develop projects that have been identified, and a very active return of the Group’s strengthened teams on the investment market.

These combined initiatives should ultimately help rebuild cash-flows by improving occupancy rates and margins and will result in a greater dividend-paying capacity and a return to sustainable growth.


  • February-March 2023: 2022 full-year results (after market close)
  • 25th May 2023: General Meeting of Shareholders
  • June 2023: Dividend payment
  • July 2023: 2023 half-year results (after market close)

The results presentation will be available on the Group’s website on Thursday morning, 28 July: Information financière – Société Tour Eiffel (


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