Merlin Properties : Prominent start of the year for MERLIN Properties due to its Business performance and Testa Residencial

MERLIN Properties has released its 3M 2018 consolidated financial statements with total revenues of € 124.1 million, recurring EBITDA of € 97.5 million, recurring FFO (EBITDA less interest) of € 70.2 million and consolidated net profit in accordance with IFRS of € 114,1 million, including the extraordinary net gain of € 53.6 million, due to the capitalization of the service contract with Testa Residencial, which has also produced an increase in ownership from 12.7% to 17.0%. In exchange, the Company loses
€ 7.9 million of service fee per annum equivalent to ca. €2 million in the quarter.

NAV amounted to € 6,338 million (€ 13.49 per share). It is important to highlight that no new appraisal for the assets has been carried out this quarter as, in accordance with the Company's policy, new appraisals of the portfolio are carried out on a semi-annual basis.

MERLIN Properties will distribute to its shareholders, through dividends and share premium, € 0.26 per share on May 25^th. The Company maintains the guidance of € 235 million or
€ 0.50 per share (+9% vs 2017) on account of 2018.

Offices

Good performance with a 4.0% average release spread. The release spread has been 2.9% in Madrid, 8.5% in Barcelona and 8.0% in Lisbon. The occupancy stands at 87.0%, which represents a slight decrease vs. December 2017 due to the foreseen exit of Huawei in Las Tablas, who occupied 16,545 sqm.

Significant leases signed since March 31st, include a lease agreement with CCC to occupy 8 floors in Torre Glories (9,135 sqm) and the option to extend the lease to another 5 floors and reach 14,777 sqm. Additionally, Allfunds Bank will fully occupy Avda. de Burgos 210 as their Spanish HQ (6,176 sqm).

Ongoing works on Balmes and Diagonal 605 in Barcelona, Monumental and Marqués de Pombal in Lisbon, and Adequa in Madrid.

Shopping Centers

The shopping center portfolio has seen a strong lfl rental growth (+6.5%), with a 0.7% increase in sales per sqm and a 3.4% release spread. The occupancy stands at 88.9%.

Significant progress on the Arturo Soria shopping center refurbishment, which has reached the 80% execution level, and commencement of works in Larios and Porto Pi.

Logistics

A booming market and an excellent quality of MERLIN assets have resulted in virtually full occupancy (98.8%) and outstanding release spreads of 13.5%.

During the first quarter of the year, 115,808 sqm of new gross lettable area (distributed on 4 logistics projects) have been included in the stock, in the A-2 and A-4 corridors of Madrid and in Sevilla Zal. All of them were fully occupied upon delivery.