MERLIN Properties Annual Report 2017 / English

ı 7 ı Annual Report 2017 MERLIN Properties is the primary example of this positive trend in the market, given its leadership position in all of the sectors in which it operates. When the market does well, MERLIN does even better: in 2017, we increased both office occupancy and renewals (+3.4% on average); in shopping centres, occupancy grew to 89.4% and release spread rose an average of 4.7%; and, in logistics, almost full employment was achieved and rents on renewals increased 13.4% on average. These data are the result of an active portfolio management policy. After two intense years of investment activity, 2017 was the turning point for the Company, having embarked on a very ambitious renovation plan to extract all the value from our assets. A total of eight renovated assets were delivered over the course of the year, including the renovation of Avenida Europa 1A, the new Renault headquarters, the successful opening of the sports area at the Marineda shopping centre, and the inauguration of Cabanillas I logistics park, the largest logistics development undertaken in Spain since 2007, 100% leased upon opening. And this is only the beginning: the Company’s plan covers major renovations through 2022. These achievements would not have been possible without the people who make up the team at this Company. MERLIN has an excellent team of professionals, recognised as such by the market, who are truly committed to the project that this Company represents, which is evident in the low levels of employee turnover. It is a team that works with enthusiasm, entrepreneurial spirit, and responsibility, and it is the team with the highest productivity levels in Europe. But, without a doubt, the support of our shareholders has been crucial in achieving our goals in 2017. This company is committed to its shareholders and to delivering sustainable results over time. To achieve this, the Company has adopted the market’s best practices in corporate governance as part of its DNA. And the Company continues to make progress: it has reduced the size of the Board, increasing the influence of independent directors, and in 2017, it approved a new compensation plan that includes the best recommendations on the subject and substantially improves the Company’s alignment with its shareholders. We have frankly good expectations for the coming years and we expect to achieve the ambitious goals we set for ourselves with the quality of the MERLIN team, the support of the shareholders, and the commitment and dedication of the Board of Directors. I want to thank all of them for their excellent work this year.