EPRA EPS for 2020 is € 2.35, of which € 1.14 in H1 and € 1.21 in H2. The EPRA EPS is lower compared to last year, due to the net disposal of assets during 2019, a rise in operating costs (primarily coronavirus-related) and a larger average number of shares outstanding. Lower rental revenues and higher expenditures entirely related to Coronavirus initiatives have negatively impacted EPRA EPS in 2020 by € 0.08.

The EPRA NTA per share is down € 3.51 or 7.3% per share, primarily as a result of a negative revaluation of the investment portfolio of € 3.39 per share.

Rental income
Gross rental income is down by 7.2% compared to the same period last year, due to net disposals in 2019. On a like-for-like basis gross rental income is up 3.5%, driven by a very strong 5.1% like-for-like growth for the Offices segment, reflecting a fall in the vacancy rate in this segment over the past 12 months.

Net rental income is down 10.1% year-on-year, due to a lower GRI and a lower NRI margin. The NRI margin is down by 2.5 percentage points to 78.7%, On a like-for-like basis net rent is up by 0.8%. In the Offices segment like-for-like net rental growth is 4.7%.

Both revenue and costs are impacted by coronavirus-related events. Excluding €0.9 million in rent relief given in 2020 would improve like-for-like gross rental growth for the total portfolio to 4.8% and if coronavirus-related costs would also be excluded, the net like-for-like rental growth would improve to 3.5%¹.

Most of the coronavirus-related costs are incurred in the HNK segment, which explains the negative net rental growth of 10.3%. Corrected for these costs like-for-like net rental growth would be +0.6% for HNK.

Service costs
Non-recoverable service charges are up by 11.1% compared to last year. In 2020 higher costs were incurred due to an increased cleaning frequency and expanded fresh air ventilation hours – all with the aim to  ensure optimal hygienic conditions in our buildings.

These additional costs have been absorbed by NSI in 2020. Excluding these coronavirus-related costs the non-recoverable service charges are up by 5.1% compared to the same period last year, and this 5.1% increase is mainly due to a positive one-off in Q4 2019.

Operating costs
Operating costs are 4.3% (€ 0.6 million) higher compared to 2019, mostly due to higher maintenance (€ 0.4 million) and higher property management (€ 0.5 million) costs, due to coronavirus-related costs. Letting costs (€ 0.2 million) and contributions to owner associations (€ 0.1 million) were lower compared to the previous year.

Administrative costs
Admin expenses are 10.7% (€ 0.9 million) lower compared to 2019. This is mainly due to the capitalisation of some staff costs in relation to our development projects (€ 0.6 million).

Net financing costs
Financing costs are down 14.2% (€ 1.4 million) compared to last year. This is primarily due to a lower average amount of debt outstanding and the capitalisation of interest costs relating to development projects.

Indirect result
In 2020 the investment portfolio incurred a negative revaluation of circa 4.5% (€ 65.0 million) compared to the end of December 2019.

Including the net result on disposals, a negative mark-to-market effect on interest rate swaps and other indirect costs, the total indirect result for 2020 is € 65.4 million negative (- € 3.42 per share).

Post-closing events and contingencies
On 10 February 2021, NSI sold one office object in Rotterdam for an amount of € 7.6 million.

On 24 February 2021, NSI signed the purchase agreement regarding the acquisition of a portfolio of three assets in our target cities Amsterdam and Rotterdam at an acquisition price of ca. € 80 million. This purchase agreement includes one condition subsequent to be met by seller.

Income segment split 2020

¹ The adjusted calculation is based on an impact on GRI like-for-like growth of €0.9 million (negative) and on NRI like-for-like growth of € 1.6 million (negative).