Partnering for the future

As protagonists in the global real estate industry, we have driven the creation and management of compelling destinations, which remain in greater demand than ever, through the sector’s rapid evolution.

We understand that the most successful occupiers still want to access the very best assets in our cities’ urban fabric, justifying our drive for quality, flexibility, and imagination.

Sonae Sierra has spent the last three decades creating some of the most dynamic real estate assets on the planet. Our growth curve has seen us tackle development risk, emerging markets and economic cycles to emerge into the vibrant world of real estate that we see today.

On the global stage, our portfolio of integrated services has made us one of the most in-demand partners in the business. By learning from the past, and taking our cues
from future trends, our history of best practice has prepared us for the industry’s further evolution.

THREE DECADES OF GROWTH

This year, Sonae Sierra celebrates 30 years of experience, a remarkable milestone that makes us proud of the business we have built. The story began in 1989, when Sonae Sierra was established to manage our first shopping centre in Portugal. The success of that venture
inspired us to grow across the country.

Our second decade, from 1999, was marked by an accelerated strategy of expansion. Sonae Sierra started to operate in Spain, Greece and Brazil and, in the following year in the German and the Italian markets. This time growth was achieved not only through the development of new projects, but also via the acquisition and refurbishment of existing schemes.

Further international expansion in our third decade was marked by a new driver of growth – the provision of services to third parties, particularly in the fields of investment, architecture & engineering, property management & leasing and sustainability, which allows us to provide world-class real estate services covering
the full property life cycle.

This strategy led us to greater international expansion and to enter new markets such as Colombia in 2010, Morocco in 2011, Algeria in 2012 and Poland in 2019. A geographically diverse business portfolio provides a natural hedge against the volatility of local growth and
country risk, but it also challenges us to be flexible and adaptable at the local level. 

Today, a capital recycling strategy and a shift towards an asset-light model have helped us to emerge with a renewed agility and responsiveness to market changes. A focus on integrated services enables us to offer more than ever to clients over the life cycle of a real estate
asset, helping cement our reputation as the partner of choice. In turn, our experience and decades of know-how mean that we understand how to maximise profitability and minimise risk, as the parameters in which we do business continue to shift.

While the ongoing evolution of the real estate industry throws up challenges, we are convinced that there are just as many opportunities. Our services portfolio is designed to grow and adapt into the future and match our clients’ agility, namely in evolving into a brave new world of retail destinations.

THE NUMBERS THAT MEAN BUSINESS

Sonae Sierra’s success shows in its results. In our annual figures for 2018, we recorded a consolidated net profit of €110.1 mln, as our company NAV increased by 1.6% to €1.455 bn. By the end of last year, our EBIT had increased 2.8% to €107.7 mln, thanks also to an increase in our services business.

We avoided €25 mln of costs through eco-efficiency measures and won more than 185 awards. All in all, we ended the year with a GLA under management of more than 2.4 million m2, and more than € 7.560 bn OMV of owned assets. From this brief X-ray of Sonae Sierra’s most recent annual results, it is clear that integrated consultancy solutions play a large role in our growth and success. Our reputation for flexibility and tailor-made services, as well as top-notch practices, continues to make us the partner of choice for a wide range of firms around the world.

MARKET INSIGHTS AND DEVELOPMENT DRIVES

Underpinning our services portfolio is a wealth of research. We believe that market intelligence is essential for turning market insights into a competitive advantage. Furthermore, our development services offer gets to the heart of creating places where people belong – contemporary destinations which
celebrate a cultural legacy. Some of our most recent schemes that illustrate this passion for place include Morocco’s Tachfine, where the design is inspired by beautiful and harmonious arabesque patterns, as well as arches, doors, tiles and ceilings typical of Casablanca. In Milan, our design for the CityLife Shopping
District integrated the traditional piazza or urban square – the heart of Italian urban life – and landmark features at key interaction points to encourage people to gather and mix.

Meanwhile, in Russia, Sonae Sierra was recently commissioned by Mall Tech to design what will become the largest super-regional shopping centre in Perm Krai in Russia, Planeta Perm. The right approach had to combine distinctive traces and elements to place the project uniquely into the local culture, while applying global, state-of-the-art standards. Elsewhere, our recently opened Jardín Plaza Cúcuta in Colombia immerses visitors in the textures and colours of the natural tropical environment, integrating lush green areas and architectural design inspired by the patterns of nature.

PROPERTY MANAGEMENT AND LEASING SERVICES

Sonae Sierra’s property management expertise is second to none. We see each shopping centre as a living space that evolves continuously, employing state-of-the-art knowledge and practices with the aim of always offering our clients a strong return.

We currently have more than 80 managed and/or leased shopping centres in our portfolio, totalling some 2.5 million m2 of GLA and representing more than 9,500 managed tenants’ contracts per year. With a unique focus on properties across all areas, including in relation to human resources, IT, procedures and research & development, we are able to deliver outstanding property management services that set us apart from the competition.

Schemes such as Alexa in Berlin underlined our successful approach. The centre has established itself as one of Berlin’s leading retail destinations since its inauguration in 2007, delivering strong operational results and international recognition for its design and performance.

An ambitious modernisation programme in 2017 reinforced Alexa’s leadership position, through innovations such as zoned retail clusters, a next-generation food hall, and enhanced tenant mix and new store concepts.

Our entire approach to leasing is innovative, whatever the space. We are accustomed to providing international leasing solutions for centres that vary from 10,000 m2 to 120,000 m2 of GLA. Thanks to our long-term relationships with major international, national and local tenants, we create custom-made, tenant-mix
solutions to suit each centre’s specifications, and the needs of its shoppers. We also offer dedicated services in the food and beverage (F&B) arena, as our studies show that eating out is a key consideration when deciding where to shop. By 2025, 20% of our shopping centre GLA is expected to be occupied by food retailers. New-generation food halls offer unique and inspiring spaces that go beyond eating, offering novel experiences where brands and consumers can interact to increase dwell time, footfall and consumer spend.

INVESTMENT SERVICES: A BESPOKE APPROACH

Sonae Sierra provides first-class investment management services. Our teams are comprised of professionals with more than 15 years of wide-ranging expertise in the real estate market, who are able to identify and implement value creation opportunities across the portfolio of assets, delivering high returns on the funds or individual assets that Sonae Sierra manages.

Sonae Sierra knows that each investor has their own target returns and investment strategy. Exiting from properties and launching new investment vehicles is a natural part of the decision-making process and a business’ investment strategy. Capital recycling is often the chief path to growth and evolution. A significant element in our expertise is staying ahead of the latest investment trends.

This year, the Iberian Peninsula recorded €4.6 bn of property investment flows in the first six months of the year. And one key trend we are also keeping a close eye on is the new Portuguese REIT regime which was introduced in February of this year. We believe REITs are most likely to function as an alternative channel for big investors in allocating capital to the Portuguese real estate market.

A CASE IN POINT: SUSTAINABILITY SUCCESS

In an ever more environmentally conscious world, we take matters of sustainability incredibly seriously. We have created our own innovative energy-efficiency programme, dubbed Bright, designed to reduce the energy expenditure of assets and improve the carbon footprint of properties across the world. Shaped by the accumulated wealth of knowledge of the team at Sonae Sierra, Bright came about because we found no single tool available that offered the levels of sophistication required according to our high standards.

What makes Bright so different is that it takes a holistic approach, looking at every aspect of real estate asset operations – from building and energy systems, to the behaviour of end-users and region-specific factors. By examining real data, the model facilitates a maximum return on investment, both on an environmental and financial level.

This programme is offered as a turn-key service or as several standalone services, and is delivered in five distinct phases. It has already helped clients around the world by transforming the green credentials of their real estate assets, while generating financial savings. So, it comes as no surprise that Bright is also the recipient of a Stevie Award® – International Business Awards® (2018).

PARTNERING FOR THE FUTURE

An uncertain world requires a partner with experience, and after more than 30 years in the business, Sonae Sierra’s extensive and specialised know-how in developing and managing real estate assets across different continents is unparalleled. Our proven experience on own projects ensures the right advice for investors, while our multidisciplinary teams are able to provide outstanding services across all the different fields of retail real estate.

From creating innovative investment funds, to providing outstanding management and development services and helping clients maximise their return on investment, our collaborative approach leads us to work with investors, trusted partners and suppliers to ensure that we achieve our clients’ visions in a safe, sustainable and responsible way. We do this through creative and pioneering projects, which respect local communities’ needs, values and cultures, and deliver future-proof solutions for our partners. At the end of the day, we offer a first-class service that combines our global reach with local understanding.

Whether you are an investor, a real estate business, a project management company or a development company, reach out today to find out how we can build better together, by making us your partner of choice.