Merlin Pptys Socimi Ord

Good afternoon, ladies and gentlemen. Welcome to Merlin Properties, a half-year results presentation. And usually, Ismael Perente, our CEO, and Fran Ribas and Inés Arellano, both directors of the company, will walk you through the presentation that you are seeing on the screen. And it will be followed by a Q&A session. So without further delay, let's start. Ismael, the floor is yours. Thank you, Fernando. Hello. Welcome to Merlin Properties' first half financial results presentation. It's been a very solid quarter of performance for the company that follows also a very good first quarter. So the whole semester has been excellent from an operating standpoint. I mean, beyond the print in net results, which at the end is asset revaluation, which is paper money, The reality is that from a cash flow standpoint, we have improved margins and we have gone one extra inch in every asset class of the company and we are starting to see a little bit of merit behind the debt on the data centers. From an operating standpoint, the rental growth came up 3.4% like for like and the occupancy was also very high at 95.4. You might argue that in the first quarter it was 96.7, but I told you that from the 99% we were in logistics, you can only go down. It's impossible to repeat the same rate in logistics. In offices, we have reached 94.2, which is our all-time high. The rental growth is quite compelling at 3.9%. In fact, as commented in previous calls, we are witnessing an acceleration of the rent negotiations with significant interest in take-up. Part of it is explained, of course, by a client from Spain that also part of it is the destruction of stock that I commented many times with you all the way through the reconversion projects which are starting to be felt in the Madrid stock of offices. Not so much in Barcelona because Barcelona is or residential is a disaster. And they have a disaster of regulation and it is impossible to convert an office building into resi in Barcelona. So it's more difficult to correct excess of the stock that in Madrid is working fine. In logistics, we went down in occupancy to 96.2, but we still delivered good organic growth at 2.2% like for like. And we have continued pre-letting significantly our width. I mean, with a big transaction in the north of Spain and one health terms, very good one for the Henares corridor here in Madrid. In shopping centers, very good like for like at 3.2%. And what is more important, we have reached an all-time low in occupancy cost ratio at 11.0%, which is incredible, thanks mainly to a very strong sales evolution that keeps us absolutely amazed of 5.8% versus the same period in 2024. With all these, the FSO generation came at plus 12.8% compared to year-on-year, with a very significant strong value creation as a consequence of asset appreciation, 3.2% gross asset value like-for-like growth. Mainly it's a data-centered thing, although it is important to remark that the deterioration seen in past quarters in the value of the traditional asset classes has not only stopped, but also reversed a little bit. The appraisers seem to be flattishly, they seem to be compressing a little bit again the cap rate. You know my opinion about that. I would prefer to stay where we were because I believe there were healthy cap rates that, you know, it seems that we are entering a cap, you know, small cap rate compression phase in valuation. What is important is that with all these, the total shareholder return in the first half has amounted to 6.6%, which, you know, is clearly a good indication for the whole year. I believe it's going to be a good, very interesting year from a shareholder's return standpoint, this 2025. Our financial situation remains very healthy at 28.6% LTV, under nine net debt to EBITDA, 100% fixed rate with no debt maturities till November, 2026. And we have 1.6 billion of liquidity position. Standard & Poor's has reiterated the triple D plus with table outlook which is of course very, very good because towards the end of the year we will need to cap the market for debt and it's important to do it on a very good double rating by standard pools and movies. Regarding value creation initiatives, we have been very active in the sale of a number of assets that we now call non-core. We are talking now always about occupied buildings, mainly for rescue reconversion. 36.4 million have been executed in that period, but we have also signed and in some cases received advance payments for another 145.9 million which basically means that we expect to comply with the 2025 budget in terms of disposals. As you know, part of the data center deployment program is financed with the capital increase that we carried out last year, but we also depend on a number of disposals that we have budgeted for 2025, six, seven, eight and nine, and we are very well on track to comply with those internal numbers. More importantly, it's been a very, very good, very good period in terms of pre-lets or listings or big listings. In data center, well, you all know that we finally placed a block of 15 megawatts in Barcelona with a big Neocloud hyperscaler, and then a block of another 18 megawatts in the Bilbao Arasur data center. I won't do spoilers, so Fran Rivas will comment in a moment about the evolution of conversations with clients for the risking of phase two, and the rest of phase one. In offices, we signed two very large headquarter leases. One with an existing client who significantly enlarged their position with us in the A1 corridor. And the other one with a very big energy company, Spanish for a headquarter in the A2 corridor. In logistics, signed with Mercedes-Benz in Victoria, 73,000 square meters, and have signed also ahead of terms for a turnkey project in the Henares corridor for another 55,000 square meters, which is very, very interesting. And shopping centers, what is more notable is that the extension to the already big Marinera Shopping Center. It's going very well from a pre-commercialization standpoint. The opening is in principle pencil in for something around November or beginning of December and yet we are 92.9% pre-led which is a very remarkable achievement by our colleagues of retail and logistics. Regarding financial results, if we move into page six, revenues have grown by 8.5%, of which rent 264.7 million by 6.7% compared to the same period last year. What is important is that we have improved EBITDA margin, so moving from 188 to 205, that with with an increase of 9% above the increasing top line. So very good conversion. Most notable, the FFO has increased from 147.8 to 166.6, which is an increase of 12.8%. Also very interesting exercise in terms of, you know, cost containment by the company. And well, as I've commented before, the EPRA MTA, has gone up very, very significantly. First, as a consequence of the capital increase carried out last year, which of course contributed a lot of cash to the company, but also as a consequence of the asset revaluation that we commented before. With all that, the dilution in FFO that was expectable following the capital increase that diluted naturally the FFO shareholders by around 16.7% has been now moderated to only 6%. and we will try to continue eroding between now and year end. So in plain language, with only the traditional asset classes for the moment working in favor of offsetting the dilution, we are managing to significantly offset the capital increase carried out last year. I mean, which in theory, or in theory in practice, was penciled in for the development of data centers. So without data centers yet contributing to the company on a meaningful basis, we are little by little closing the dilution cost by the capital increase, which is, I believe, a remarkable achievement. And in terms of MTA, the strong revolution has meant that we have almost flattened the dilution cost by the capital increase, and we are more or less where we were last year in the same period with minus 0.5%. On page seven, what you have the like for like divided by offices, logistics and shopping centers and you see what is like for like growth and change of perimeter. And on page eight, you see the occupancies, 94.2% in offices, 96.2 in logistics and 96.5 in shopping centers. later during the presentation I will give you what our estimated figures for year end look like, which offices is going to be relatively flat, a little down from the 94.2. Logistics will go significantly up, depending on a couple of contracts that we are negotiating and shopping centers will remain relatively stable because it's impossible to move it from there. And without further delay, I will let my colleague Ines Arellano explain the details of the different asset classes for your benefits.

Thank you, Ismael. So moving forward to things like PEMS, which today still represents 58% of our portfolio in terms of value, the momentum is quite positive, demonstrated by all kinds of high efficiency levels, both in Madrid and Lisbon. Barcelona is still suffering from a temporary oversupply situation, and it will take some time to be digested. The drop in occupancy, however, has mainly happened in June, and that's the reason why you still see a solid lackalike strength of growth of taxis on the focus sites despite the impact. In Florida, you may have noticed that we reached an agreement with a reputed and not a none of ours, that implies a market-to-market on the existing space in first few, and that we've now signed an additional 21,000 school units expansion with them, in accordance with projects to be developed in the same campus in a deadline. Excluding this impact, however, the overall release spread could have been plus 5.1% overall, and more importantly, plus 3.3% up versus the minus 3.7% in Madrid. We have contracted 165,000 submittees in the first half of the year, which is a wide enough example, or sample I'd say, to provide us with reliable information on what is happening in the market. And this is shown in slide 12. As already flagged in February, the Madrid office market is experiencing a very interesting trend. There is a clear need for residential, amongst other users, and there is no land available in Madrid's city centre, which is driving the reconversion of certain office buildings that have lost current book values. Coupled with no new supply in offices, the overall office stock is shrinking, and this is demonstrating the good quality assets, not just with the cupidity gains, but also with century new vendors. In our portfolio, we have identified 13% of our Madrid stock suitable for reconversion. Please do not think that we're going to be selling off everything. It also means that there's certain uses, like universities, that are compatible with the type of buildings that we have, and we can extract more value in cash flow. And all of that is within our portfolio, we have CUNED, one of the most private universities in Madrid, that has 18,000 screen reader samples in CureVisa. We looked at the statistics, and what we can say is that the performance continues to drop 2.2% in life-to-life rental growth, and the overall drop in occupancy is only due to the expected exit of a tenant in a 47,000 square meter warehouse in Cabanillas, a good area. And the asset, as you may imagine, the Disordinary Portable Business, is under compensation, and we have several victims. Hopefully, it will be occupied, if not by the year end, at the beginning of next, so the cut-off date of December could be either going back to 99% again or staying in the range of the 96% of the interest ratio. But we've also experienced a significant increase in occupancy in Barcelona, which obviously does not impact as much as Madrid does. This is a spread, plus 7.2% in the first six months, with higher living volumes in the second year, reaching 260,000 square meters complex. Moving to slide 16. This is a minority state in Southport, Barcelona. It also showed a practice into the country's spread with around 157,000 committed contactless and a temporary decline in occupancy, which cannot be considered a trend because this, or Barcelona Portfolio Initiative, has shown more than 500 states increasing occupancy. Shopping centers. This, I think my wife likes to call it, or Cinderella became a princess long ago, and it's still showing its strength. All KPIs reported are positive. plus 3.2% like the live rental growth, 96.5% of QPC versus 96.1 plus quarter, sales evolution outstanding at 5.8%, football at plus 2.4% low, OCR at 11%, and the retail spread at 1% coming from 3% plus quarter. And then, Let's go to valuation since July 21. All this through its operating performance translates into valuation. GAV has increased by $518 million, standing at $12.1 billion as a result of a 3.2% valuation uplift, mainly driven by development against new data centers, which have shown a 38.2% like-to-like growth. Evaluations have resulted in a 5.2% passing growth yield, which implies a 4.3% net initial yield, slightly lower from the one shown in December, because data centers are still not yet stabilized. CNS has totaled 361 million, of which around 68%, 208, come from data centers. Operating-based centers have crystallized part of the expected value creation, and Sam will walk you through in a minute in slide 36. And appraisers have decided to also value the assets that we started its construction after obtaining construction license, therefore anticipating value recognition. Now it is very important to say that all the landfills we made are called. So it's only the either operating or already into construction a portfolio that has been given a value by the appraisers. Methodology is as follows. Appraisers assess values with a 10-year GPS, where they apply cap rates. You can see in our results that the range is from 5.5 to 8% and the exit values. And this survey, 9 to 11%, which today still looks high for UBIS assets. For the first time for a while, now we see an overall yield compression in average 7 bits, flat active yields though, in all three traditional asset classes, obviously being not meaningful in data centers as the assets are marked as stabilized, and we'll see the run path in the years to come. In slide 23, we can show you the sales financial structure that we have. This is moving from the asset side of the balance sheet to the liability side of the balance sheet. We finished this semester with a gross debt of $4.4 billion, down from $4.9 billion in December after repaying the $600 million bond in May. We have net debt of 3.6 billion, implying a 28.6% RTV. Cash flow generation and valuation have almost offset dividend payment and capital transfers, and this is shown in this 28.6% RTV. As said by Ismael, net debt to EBITDA stands below 10%. 8.8 times, and the average cost is slightly higher than the one in December, 2.6 times from 2.5. It obviously will increase slightly as we refine it for cheaper stones, but all of that is fixed with average maturity of 4.4 years. Liquor G, also recommended values in IL, are still high, because we still have some of the proceeds obtained on capital increase. And S&P, we confirm our QWC PLUS rating, which gave outlook, together with Moody's, on the basis of sustainable leverage and standing cash flow. In July 24th, very little else to add. 84% of our debt is corporate, so 75% of debt is gone, and 25% is unsecured bank loans. And only 16% of our debt is mortgage-based. The next maturity to be faced in 2nd November 2026 and although we still have time to tackle it, we pray to be prudent here as we've always been when it comes to debt and take advantage if and when we see a window of opportunity. So with no further delay, I'll pass the floor again to Ismael who will comment on the value creation part of the business. Thank you.

Thank you Ines. Regarding capital recycling, the investments in the first semester were you know, very few. We acquired one co-working space that we operated but didn't own, around 2,000 square meters in Barrio Salamanca in Madrid. And we bought a land bank for two data centers, one in the north of Madrid, Tres Cantos, with 30 megawatts of IT capacity confirmed, and then a potential expansion of up to 130 in the future, which is requested but not obtained yet. And in the case of Madrid Getafe, we bought a former industrial manufacturing facility in which we had 48 networks of existing, I mean, confirmed IT capacity given the electric power that we enjoy in the spot. Regarding divestment, we are at 183.2 of which 37.4 executed. and 145.8 signed all above GAB. There are some adjustments still pending in some of the cases. And we execute later in the year and in 2026, as you can imagine. The reason why we operate this way is because we want to keep cash flow as long as possible. I mean, at present, we are a company which is you know, excessively financed. I mean, we have had a lot of cash. We are running out of cash very quickly, but we have had a lot of cash. And of course, what we need to keep now is rent rather than cash. So, you know, when we sell assets, we don't rush. We prefer to keep them in the balance sheets for longer and enjoy the cash flow. Those sales are mainly concentrated in offices in the pre-reconversion play that we have commented with you on a number of occasions. And those assets sold contributed 8.9 or will contribute 8.9 million gross rental income in 2025. Hence, the average disposition yield is 4.9% gross, which is interesting from a capital recycling perspective if reinvested in data centers. Regarding the Marinera extension, the size of the shopping center has significantly increased by about 25%. I mean, total size at present is 126.5 thousand square meters, which is a lot. It was already the third largest in Spain and now is the second. But what is more important, despite the diversity and quality of the existing tenants, we have been able to find further tenants for the extension. We are almost 93% pre-let and with a capex of 41 million which in part was defensive because what we wanted to do is protect the shopping center upon the exit of a shopping list in the area. We didn't want any undecidable neighbor to come near our shopping center which is of course one of the big cash flow producers in our portfolio. So what was once a defensive movement has turned into a decent offensive movement because we are obtaining a yield on cost of 6.5% which is not great but it's not bad. Regarding Adequa 4, this is a large pre-let, one of the largest signed in Spain since the great financial crisis. We have signed 10 years contract with more than 70 million backlog added to our office division and 21,000 square meters with delivery at the beginning of 2028. CAPEX is close to 53 million. The yield on cost is 6.2% on historic cost of land, including historic cost of land. So if you do just the yield on CAPEX, it's 10.4%, which at the end explains why we are doing this, because in reality what we are doing is moving idle office land that we have in the A1 corridor in Madrid, which is now performing very, very well in terms of occupancy. We are moving that, let's say, land bank into WIP, and that WIP into product in operation, hence bringing more cylinders to fight together in favor of the performance of the company. Together with this building, we will assess the convenience of building the remaining buildability in the complex, which is a little tower. It's a low-rise tower of around 100 meters with circa 25,000 square meters of total GLA. In order to optimize first construction synergies, And also, you know, capitalize the momentum in the market. We believe that if we add that capacity in day one corridor, we believe, I know it's a bold movement, or may look like a bold movement, but we believe we will fill it up in due time. Because I know that the corridor now, with the proximity of Operación San Martín starting to perform very, very well and it's our opinion that we will be able to make good use of our money by bringing the power together with the pre-led, fully pre-led building. In logistics, We are building or are in project or will build in the short to medium term 291,000 square meters. The last modules will be delivered in Lisbon in the first half of 2027 but the rest is mainly 2026 business. Total investment will be around 156 million, and the expected gross rental income is 17.2. That will move our logistics, our visible logistic income beyond the 100 million mark, which is important. Although, as you know, there is invisible income in logistics that comes from Barcelona, which is accounted for as equity method, and you don't see the cash flow, but the cash flow, of course, is there. The yield on cost is 7.5% and the yield on capex is 11.1%. So I believe it's an interesting move to put that also into production. We need cash flow in order to continue feeding our little base of the data centers. And with that, the non-committed pipeline will be only 190,000 square meters. mainly in Madrid, Valencia and a little bit in Seville with a pending capex of 101 million and stabilized GRI of 11.5. So a yield on cost in the region of 8% and a yield on capex in the region of 11.4%. So looking forward to mobilize also this pocket of value in the coming future so that we do not keep in our balance sheet any assets which are non-cash flowing other than the land of Operación Samartín, which of course will take more time to become productive. And Fran will comment on the Digital Infrastructure Plan. Thank you Ismael and good afternoon to everyone. I'm going to cover now the update on our Project Mega and the main achievements completed over the first half of 2025. So as you can see in page 32 and 33, we have summarized the current positions of our data center division, that we generally call the Merlin Edge, within the Iberian Peninsula. Precisely in page 33, you can find a table with an overview of different phases. Phase 1, which comprises our three assets in operation. Phase 2, which includes our work in progress, our WIP. Phase 3, for the upsizing of the former three locations. And finally, the pipeline which represents the future growth of our data center division. Starting with Phase 1, and as a snapshot, after we complete the letting of all Barcelona, including the six megs of repowering and Adasur, the vending capacity of Madrid and the fact that the advanced conversations we are holding with one specific client have driven us to update the standardized DRI from the former 88 million to the current expected 92 million, which also improved as well the gross chill on cost up to 15.1%. In our wheat category, phase two, the total IP capacity has grown from the former 210 megawatts to the current 246. after the inclusion of a second building in Lisbon. Consequently, the stabilized GRI that we are estimating in 2029 achieves 379 million with a gross deal on cost of 14.2%. The reason of including now a second building in Lisbon, as compared to former calls we have had, is due to two reasons. The first one is the fact that the US government has finally decided to do not implement the Artificial Intelligence Deficient Rule which classified at the time Portugal among other countries as Tier 2 and that rule basically was impeding Portugal to import the latest technology in terms of chips Secondly, the fact that in light of the performance and also the revaluations seen in Phase 1, we have considered we can stretch a little bit more the funds raised last year in our capital increase and the debt attached to it, of course, without affecting our target LTV and the net debt to be that we have agreed with our rating agencies. In the up-sizing category, we have included now a new repowering of Building 1 in Bilbao-Lazur, that has been already been requested and we will be answered in the following months. Same applies to building 6 in Arasur within our pipeline category with 30 MEC of potential additional capacity. Entering now in more detail in page 34, we can see the current status of our operating assets. In Barcelona, within the 22 meg of maximum IP capacity, we have already equipped, as you know, 16 meg, which are currently in operation. And the additional 6 meg of the repowering will be commissioned during the first month of 2026 with ready-for-service set for first half of 2026. As a curiosity, this additional 6 meg of repowering will be with liquid cooling systems, while the first 16 meg are air-cooled. In the Val d'Azur, what we call building-free, which was the first one we have built, the 22 megs are already equipped. 10 of those, 10 megs will be air-cooled, and 20, sorry, 10 megs will be liquid-cooled, and the 12 originally is air-cooled. We are now working on the fit-out of the client. which from now in June we have already given the first rooms and there are different plans until they are in full operation by the end of Q4 2025. Finally, in Getafe 1, as of June 30th, 2025, As we described in the slide, we have four MEC equipped. Right now, this figure has jumped to six MEC, is what we have equipped right now, with the remaining 14 MEC to be commissioned by the end of this year. In terms of commercialization of Madrid Getafe 1, we are in well-advanced conversation, as I was recommending before, with one client, which is what we find booking, considering the level of both technical and commercial involvement that we have already achieved with this client. For the available capacity that we have of these original six megs, which in this case is five megs of leads, And regarding the second phase of power, the additional 14 that we will get next year, we have also booked for them another five, you know, that will increase, basically, that legging with the client up to 10 megs in Madrid-Jetafer 1. And then, finally, also, we give them, basically, the option that if, when, or when, they are empowering of 6 megs that we are foreseeing in this asset, once we get it, they have also booked that capacity as our future growth in the next years. As you know, we have been holding this capacity until we have some visibility on the power delivery, but now we assume there will be more clarity on the timing to get the power in the recent week, so we have included this in the negotiations of carbon availability. Now moving to page 35, we are showing you on a year-by-year, the expected GRI generation of our operating assets until 2027. where, as mentioned before, we forgot 92 million of GRI. Out of these 92 million, 66 million have been already contracted so far, and with Madrid, Getafe, once it's fully left, we will jump to this magnitude. In terms of value creation of phase one, it's showing in page 36, The total investment remains at $608 million, valued as of June at $719,000, implying basically from the capital already invested another $155 million of capital. value captured as of June, and considering the expected value of the asset after our appraisals, there will be another 293 million of estimated value to be captured, which if you add also the rent that is being generated over the periods, this will convert this Phase 1 investment in a very profitable project for our shareholders. Moving into the update of our WIP, phase two in page 37, both Bilbao Azure Building 2 and Lisbon Data Center Campus Buildings 1 and 2 are already under development. In the case of Lisbon, we will see this again at an early stage. In the case of Bilbao Azure Building 2, we will see in the following slide the progress in construction is evident because the building is already almost ready. All equipment regarding this building has been already ordered to guarantee that delivery date by Q4, 2026. And regarding Building 1, which is the third building that we are constructing in Bilbao, Brasur, which is the largest one once the rebowering is obtained, we expect it to start construction by the end of the year. And also equipment orders are well on progress to guarantee as well the delivery date by the end of 2027. The particularity of this building is its connection to an on-site photovoltaic project that will feed renewable energy into the site which also improves even more the sustainability character of this development. In terms of commercialization, we have two initiatives launched. one with a client interested in taking most or you know with different ramparts even all of this capacity of building two and another that I will give you more details at the end of this section which could comprise both in Lisbon although its construction started last September right after the capital increase the conditions of the Lisbon area of like us as commented several times in several calls to carry out soil compaction and special piloting works as we will see later on the presentation. News in this project is now the inclusion of Buildi2 in the same first phase of construction for the two reasons I commented before. Also taking advantage of the power ability we have on site, which covers the first 180 meg of IT in one of the fields, and then we have also secured the second step to reach maximum capacity of the first phase without the upsizing. In addition to this power availability, we have also signed an agreement with EVP to provide, in the same case like Arasura, another on-site photovoltaic plant at 200 MEC, which will be physically connected to the data center campus and also will generate a significant part of the energy consumption of this building. In terms of commercialization, it is still a bit early to attend conversations with future customers as the targeted completion date is the end of Q4 2027. But we have included this capacity as well in the European initiative that we will cover at the end of this section. Regarding Madrid Getafe 2, we are awaiting to have real life from the administration to start the demolition works on the site. Those works will be carried out by the seller. of the land and we are finishing our design project to submit it to the municipality in the following months. Finally, on Madrid-Tres Cantos, the licensing process is advancing and urbanization of the land should start within the first half of 2026. Regarding the CAPEX of this week, I'm just jumping to page 38, we are showing you the update figure of the total CAPEX expected for this phase two, which have increased from our former 2.1 billion to the current 2.5 billion due to the incorporation of building to additional campus. We highlight here that the CAPEX in a data center as we have several times commented is around 20 to 25% on civil construction where payments usually are more linearized while the remaining 75% is equipment where payments are more back-ended. That's the reason why we always present CAPEX commitments because you know when the timing of payment is a little different from what we show here. The pace as you can see basically is that we expect to commit 836 million in 2025 out of which 49%, 411 million have been already signed, committed as of 30th of June, 2026. In page 39 you can see some pictures of the construction works in Bilbao Azur building 2 and also basically on the top right photo you can see in the background the building we have in operation which is our building 3. In page 40 we are showing different photos where you can see the soil compaction and piling process at different stages so and the final one is from the right, the bottom on the right side of the slide. And after the heat reconstruction, our work plan will start right away. Regarding phase three, or upsizing barriers, in page 41, the news there of the incapacity in the campus, after including building two in the first phase of construction. Also, we have included the potential of 12-meg IT in building one, that I was mentioning before, and also in , we have the capacity of this power upgrade. And then, going back to one of these initiatives in terms of commercialization for campus, is the possibility of being selected as one of the gigafactories that the European Union have launched in April 2025. As you can see in page 42, the European Union aims to become an AI continent with large-scale AI data and computing infrastructure across Europe by setting up at least 13 AI factories. There are some existing ones like the Supercomputing Center in Barcelona, but also establishing five AI gigafactories to which the European Union wants to devote 20 billion through different loans and grants. With this objective in April 2025 the EU published its call for expression of interest of AI Gigafactories and Merly Edge submitted to this EU a consortium capable of delivering what we believe is a unique AI Gigafactory and the reasons why we believe this is unique is for different reasons. Now the first one is that we have not only permitted land with power assets but That plan is currently under construction, and it fits with your objectives of having capacity ready for service in years 26 and 27, and to achieve these timings, unless you have already started it, it's almost impossible that you can meet those deadlines. And as you have seen before, both of our Alasur, the Alasur and the Lisbon campuses meet these deadlines, and will provide 180 meg of IT capacity. Also, they are looking for toilets with capacity of expansion within the same size. And again, and this one offers additional 358 meg of piping capacity to go there. And finally, they are seeking for technical capacity of buildings to support the levels of densities and ensure us that the artificial intelligence type of computing is requiring. And this needs to of course maintain sustainable parameters. In our case, as you know, we don't use water consumption and we have a very low UV, which basically matches to what they are looking for. After this discussion of interest, the different consortiums across Europe, because as I said this is a European competition, will need to submit binding proposals by October, and the European Commission expects to decide the final locations of their gigafactories by the end of December 2025. As I said before, this is an initiative from a commercialization point of view, and of course we are competing with other countries and with other countries, but after seeing that the timing that the EU is looking for and our ready for service capacity and the reasons I mentioned before, we decided to apply to it. Unfortunately, I'm not allowed to provide you with much more details of the nature of our structure or members of the consortium, first because due to confidentiality reasons, but also because we are in a competitive process And so, of course, if there is news regarding this potential initiative, we will keep you posted. And yeah, that's all from my side. Ismael, closing remarks? Thank you, Fran. Well, just closing our part of the conversation today, I mean, opening the Q&A, simply to stress what I commented at the beginning, We are seeing strong organic rental growth at the company. We are seeing a strong momentum in offices in Madrid, a little bit of weakness in Barcelona, and good performance continues in Lisbon. We are generating significant FFO in the company. I mean, the company continues to be a highly cash-flown one with very healthy margins, which is always a nice thing to see from a managerial perspective that we don't lose the tension and we don't become and you know, and sclerotic like happens in many. We continue stressing our teams to work towards high occupancy levels and also we are enjoying a certain tailwind because Southern European economies seem to be having a good momentum and Spain is clearly not an exception Regarding value creation, what is particularly satisfactory is that we are generating a lot of alpha, basically by moving projects into WIP and WIP into assets in operation, and we are meeting that with a very significant success in commercialization. In data centers, when you know what we have been doing with Core WIP, In offices, we led two big headquarters leases to Tecnicas Bonitas and another big Spanish energy company. In logistics, we delivered 33,000 square meters just two weeks ago to Wharton and Moatum in Lisbon Part B. And we led almost 73,000 square meters to Mercedes-Benz in Victoria Fundis. And what is important, the long-term non-committed CAPEX GLA is only 190,000 square meters. So we keep reducing the land bank that we acquired in 16, 17, 18 at very good prices. We keep reducing that land bank and adding cash flowing assets to our inventory. And in shopping centers, I believe the Marinera extension is a remarkable achievement. The leasing teams have done a fantastic job and by pre-letting in record time, close to 93% of the very significant GLA addition which is close to 27,000 square meters is a lot. So as a very quick outlook, we see an improving investment market. We see also an improving underlying market in leases, particularly in offices. in shopping centers a little bit business usual for the moment. The evolution of private consumption in Spain keeps us absolutely amazed. I believe it's a mix of a very low household indebtedness, a little bit of doping from fiscal deficit, that clearly spending capacity of people continues to surprise us. As a consequence, we have decided to raise a little bit the FFO guidance for 2025 to 0.56. Many of you will take the 0.30 of the first semester and multiply by two. Please don't do that because we will have less 700 and change million working in cash at bank for seven, eight months of the year because we repaid the bond on the 26th of May. So that will subtract about two cents of that theoretical calculation of 0.60. And then we are also counting on tapping the bond market between end of August and October. I mean, we will of course be quick and benefit from the in pricing in the market and volumes and also in the maturities. And that additional cash will of course because the remuneration we will obtain in cash advance will be a point and a half lower than the cost of that money to us. So that will subtract another two cents easily of cash flow to the theoretical calculation of 0.2. So, 0.56 is okay. I know some of you are now expecting 0.57. Please, bear with us. I mean, I don't believe it's super important that we will, of course, do whatever is in our hands to excel the guidance that we are giving to you. But, you know, it's pretty much accurate at this point is what we see. And regarding translation into dividend, well, as you know, we were a little bit below the 80% payout ratio. You know, going back to 80, that increase of two cents in cash flow per share allows us to recommend to the board another two cents of extra dividend per share. So we will propose to the board raising the dividend from 0.40, that was our initial estimate at the beginning of the year, to 0.42. And that is basically it. So we can move into Q&A. We are here to answer your questions. Thank you, Ismael. We will now start with the Q&A session. Please remember, in order to raise the questions, you need to press star five. Star five. So the first question comes from the line of Mariusz Pastu. Mariusz, the floor is yours.