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Remon Vos: Good morning, everyone, from CTP here in Prague, Czech Republic. Excited. And thanks for dialing in. It's good to have you on the call. We are going to talk about the 2025 results, which are good. But before we start, I'd also like to look back. 2025, you could say, has been 25 years of growth. We have completed our first building in 2000 here in the Czech Republic in Humpolec, where we did our first CTPark model. The CTPark Humpolec was the first site we acquired, initially 10 hectares, and later on we had the opportunity to grow that park. So that's where we first started with a club house where we looked for people and did establish a small team and did then develop a number of properties, and those buildings are still fully leased and many of the tenants which we initially had actually, they're still there, and they have been able to grow their business. So 25 years of continuous growth, which started with nothing, with a piece of land, and then building and second, et cetera, et cetera. So thank you very much to all the very loyal clients, all those companies who we have been working with, the companies who gave us the opportunity to work for them outside of the Czech Republic later on. And of course, thank you very much to all people we've been working with a lot over the past 25 years. And thank you to all other partners and of course, the fantastic team here at CTP, which in the meantime is 1,000 people, more than 1,000 actually nowadays. So that has been 25 years of continuous growth, good times, bad times with all kind of different opportunities along the way. So '25 has been a strong year, has been a good year with good results, which illustrates also the growth engine, the thing we like to do, we like to grow and the largest growth engine in the business here in Europe. So last year has been also an important year for us, because we added another country. We opened up business in Italy. In the meantime, we have more than 200,000 square meters of projects under construction in Italy, mostly pre-leased, 70%. We do that in south of Milan, close to Piacenza, Castel San Giovanni, but also in Padua, and we have other projects underway. At the same time, we set up a team of people in Italy, and we have a land bank to build an average of, we thing, 200,000 square meters of properties over the next years, and we hope within 5 years to hit the 1 million square meter lettable area target in Italy as well. We see good opportunities in Italy. Overall, we see opportunity in Europe over the next years. So we're quite happy with the entry so far, and we're making good progress. The land bank, mostly North Italy, but also strategic sites in the region of Rome. So there's also other places where we believe we will be successful in the development of our industrial properties, again, mostly for existing clients, so the companies who are already renting from us in other markets. For those clients, we plan to develop properties in Italy. And the amount of business we do for existing clients is approximately 70%, 7-0 percent of the total amount of business we do. When we look at drivers for Europe, it's definitely near-shoring Asian companies coming a setup shop in Europe for Europe. I mentioned defense, but also technology, semiconductor industry, consumer goods. People have more free time, so they go out biking, running. Pets, massive industry. We do multiple facilities for pet food producers, pharmaceuticals. So there's a whole of consumer spending, means people have more money to spend than they had 25 years ago when we started here, and we see that in other markets in Serbia, in Slovakia, in Romania, where we came initially maybe for low-cost manufacturing and later turned into manufacturing for domestic market. And nowadays, Central Europe is the engine of Europe. Here is where you go for manufacturing. And yes, it's all positive. So relatively good outlook, and we have a number of growth drivers. We are not in it for the short, we're in it for long. So we have plans for the next 25 years. And those plans are definitely to make CTP a global player and to grow with our clients and to use all the experience we have building business parks. Last year, we signed 2.3 million square meters of new leases, 2.3 million, which is a bit more than we did the year before. In '24, we did some 10% less. Rental rates were a bit higher last year in '25 compared to '24, approximately almost 5% higher rents than same building in a year earlier, in 2024. So a bit rental growth, 10% more deals, and still around 10% yield on cost. Target, midterm ambition, continue to grow with existing clients, which we have a lot of them. Good companies. They pay on time. 99.7% is rent collections of money which we charge to tenants, which is paid. And as I said, most of them on time, good companies. 70% of all new business we do with existing clients have 80% retention rate. And this is also important to mention, 75% of all the projects we do are being built within existing business parks. So we don't do stand-alone boxes. We really create an address, a park, an environment, an ecosystem with sufficient infrastructure and manage these facilities for people to work, develop themselves, to create business together, to work together, to grow stronger, and to have a stable business park. Also not overexpose to one specific industry, you want to mix it up with different industries. It's also good for labor market. We see a lot of automatization among our tenants. So they continue to invest in their facilities, in their production lines, in their technologies, which is good as well. We break it down at CTP, as you know. We talk about 3 things. We have the operator, which is the income-producing part. So the part of the company will look after the buildings which we have built over the past 25 years, with EUR 840 million of rental income, on the way to hit EUR 1 billion rental income next year. So it's the operator with good occupancy level, always above 90%, between 93%, 95%, depends a little bit on the market and the location where you are. It depends also on how much property we actually build to enter a market and you need time for the market to absorb all those buildings, but remain at the target around 93%, 95%. That's the operator. Then we have the developer. Those are the people at CTP who develop properties or who build business parks and properties. Quite active now also with inventing new type of properties, adjustments, constantly working on making these buildings better, both the existing refurbishment upgrades, but also new properties. And better means flexibility. So we have generic designed buildings for multiple generations, energy consumption, maintenance, those things are important when you design a property. That's what these guys are busy with. Some highlights as well what we've done in terms of completions last year, 1.3 million square meter, 180,000 square meter in Bucharest; 65,000 square meter in the CTPark Budapest in Hungary, but also, of course, in Brno, Czech Republic, yes, the home of CTP, where we have built millions of square meters. Last year, we did a deal with FedEx, for example, just to mention one. Part of our 30-30 plan, right, to grow to 30 million square meters. 2 million square meters under construction this year, which is good for EUR 150 million of rental income. Another highlight, maybe if you talk about those 2 million, we do a lot in Poland, the largest economy, largest country in Central Europe, very dynamic. Can do, a lot of support from the government, very good locations, I think we have secured a good team on the ground. So there we invest a significant amount of money now building properties, mostly leased, in and around Warsaw, but also Upper Silesia, Katowice, Zabrze, as well as along the German border on the west side of Poland. So we see there good opportunity, as well as in Gdansk, by the way. Another highlight, I would -- yes, Bucharest, Romania has been good, is still strong. Serbia is strong. Germany this year is important to get things going in Mülheim. Some of you have been on the Capital Markets Day event last year, we looked at Mülheim Energy Park with E.ON, Siemens and more to come. So that's happening, making good progress in Düsseldorf as well as in Wuppertal. So overall, quite positive about Germany as well. I think, yes, well established and good position. Last but not least, the growth engine, the third activity, we look globally at opportunities in different countries. And how does this work? Well, it comes from clients. Clients tell us, okay, we are going to that market, because we see growth. We need properties. Are you there? Sometimes we are, sometimes we are not. If we are not, then we have a closer look at such a market. We think shall we go there? Does it make sense now? And we constantly do that. Sometimes we do not enter. Sometimes we have a closer look. Now we always have the desire, as you know, to also become active outside of Europe, because we see other opportunities in other markets. And we found good opportunities in Vietnam and strong demand from existing clients. So we continue to have a closer look. We announced it last September. And so far, we've been making some good progress, having a closer look at the market and the opportunity. We have a few people in the meantime on board. So we have a CTP Vietnam, and we have there a small team of experienced industrial property people. Vietnam, obviously strategically located, 100 million people, very productive workforce, but also quite young people, around 30 years of age. So in the future also, you will see consumer spending. Well connected to the rest of the world. And that will also give an opportunity to get us feet on the ground in Asia and also closer to other Asian companies who look at coming to Europe. And then we'll keep you up to date on developments we are making. Yes, it's not only about getting bigger, we need to also get a better company. So we are obviously constantly working on getting a better company with maybe doing more buildings with less people, more efficient, more effective, different processes and procedures. We automatize. For example, when it comes to property management, when it comes to energy consumption, we know exactly how much energy tenants consume in their buildings. We can help them again with energy management with clear understanding of the condition of the building, and when there are issues, property management related, then we can fix that. We have a clear system for that in place in the meantime to monitor all the maintenance and repairs, which potentially are needed. So both energy consumption as well as maintenance and repairs to make sure buildings are in good condition and remain in a good condition. That's one example. And there's many other things we've done, whereby we've introduced new processes, better, and software and automatize, standardize, digitalize the company, and that makes us think better and quicker and more efficient to continue to grow our business. Yes. So we're looking forward very much to the next 25 years. Thank you for your attention. I will hand over to Rob. Some of you know Rob. He's not really new to CTP, but as IR, we are happy to have him on board and look forward to answering your questions.
Robert Jones: Turning to the financial highlights. Net rental income increased by an impressive 14.1% to EUR 738 million, driven by record leasing of 2.1 million square meters, excluding Italy. Like-for-like rental growth came in at 4.5% in FY '25, accelerating from the 4% we delivered in FY '24, and this was driven by indexation and positive rent reversion capture. We also delivered record development completions of over 1.3 million square meters with occupancy at the year-end still remaining stable at 93%. Annualized rental income increased by 13% to EUR 840 million, illustrating the strong cash flow generation of our portfolio and locked-in growth profile of our business for 2026. Company-specific adjusted EPRA earnings increased double digit by 11.3% year-on-year to EUR 405 million. CTP's company-specific adjusted earnings per share amounted to EUR 0.85, an increase of 6.3% year-on-year, as we also made positive progress on our debt refinancing during the period. This EPS figure was just EUR 0.01 variance to guidance, driven by the timing of development completions in Q4 '25 with some moving to Q1 '26. As we look forward, the important message here is that our medium-term double-digit annualized growth trajectory is unchanged, as Richard will highlight shortly. Now looking at the valuation results. The revaluation of the portfolio for 2025 came to over EUR 1.1 billion, a key contributor to our leading total accounting return for the period. Of this positive portfolio performance, EUR 422 million was driven by the construction and leasing progress on our developments, while EUR 649 million came from the revaluation of our standing portfolio with the balance from our land bank. As at the year-end, the total portfolio gross asset value now stands at EUR 18.5 billion, up 15.6% from FY '24. CTP's reversionary yield stood at a conservative 6.9% at full year '25. For '26, we expect further selective yield compression and positive ERV growth in line with inflation. This is also illustrated by the new leases that we signed in '25, where rents were a solid 4% higher than 2024, adjusting for country mix. The supportive demand drivers of our business remain present, whether that be near-shoring, manufacturing in Europe for Europe, businesses upgrading their supply chains or reacting to the changing global landscape alongside increasing deglobalization of political agendas. Our core CEE markets, where industrial and logistics space per capita is half of that of many of other Western European markets, continues to benefit from these supportive trends alongside our own Western European markets and our opportunities being assessed outside of Europe. We are not short of opportunity, nor are we short of capital, with that opportunity driven primarily by the embedded value to be unlocked from CTP's existing land bank of more than 33 million square meters with the majority next to our existing CTParks. This land bank that we have on our balance sheet allows us to facilitate our tenants growth as a solution provider for their real estate needs. We remain active in the market for the acquisition of land, especially in Poland and Germany, and we replenish and, in a number of cases, grow the land bank in existing markets where returns are the most attractive. Now as Remon mentioned, we also continue to look to enter markets such as Vietnam, following on from our successful CTP Italy market entry at the back end of last year. Our EPRA NTA per share increased from EUR 18.08 at year-end '24, up to EUR 20.39 FY '25, and this represents a strong increase of 12.8% during the period. With this NTA growth, in conjunction with our dividend distributions, we delivered a total accounting return to our shareholders of 16.1% over the past 12 months, highlighting our superior total return profile, which is underappreciated by the equity market within the real estate sector. I now hand over to Richard.
Richard Wilkinson: 2025 was another year of solid growth for CTP as we continue on our journey to 30 million square meters of GLA, a doubling of the current portfolio. The company's interconnected business units, the operator, the developer and the growth engine are all supported by our strong access to debt capital markets, diversified funding structure and multiple sources of liquidity provided from across the globe. 2025 saw us receive an investment-grade credit rating upgrade to BBB flat from Standard & Poor's. Moody's also have a positive outlook on our credit rating, confirming the growth trajectory of our business. This January, we again evidenced the high institutional demand for our debt, issuing a 4.5-year bond at a spread of only 92 basis points with a peak order book of over EUR 4 billion. Looking forward, we will continue to diversify our sources of debt funding as well as managing our liquidity to ensure we do not hold material excess cash. We also target growing our share of unsecured debt towards 80% of total outstanding debt. Turning to the key credit metrics. Our interest coverage ratio was unchanged quarter-on-quarter at 2.5x, and we expect this level to be the bottom. Our normalized net debt-to-EBITDA remained broadly stable at 9.3x and our loan-to-value stood at 46.1%. This LTV is marginally higher than our 40% to 45% target due to us seizing the acquisition opportunity in Italy at the end of 2025. In Italy, we will deliver 200,000 square meters of GLA in 2026, more than 10% of our annual target. And with a land bank of over 8 million square meters, we have a long runway for growth in Italy, a country with a significant undersupply of modern A-class industrial and logistics space. As our development pipeline is completed and over 10% yield on cost and revaluation gains are fully booked, we expect loan-to-value to move back towards our target range. To complete our development pipeline of 1.4 million to 1.7 million square meters in 2026, we do not need additional equity capital due to our sector-leading yield on cost around 10% from projects to be delivered in 2026. Every euro we invest in our pipeline increases our ICR and decreases our net debt-to-EBITDA as our leasing income comes on stream. This allows us to grow group rental income at double-digit rates while simultaneously improving the most important credit metrics. In 2025, we signed EUR 1.7 billion of unsecured debt to fund our development business, debt refinancing and our growth engine. We continue to demonstrate our ongoing strong market access whilst actively managing our funding costs. During the year, we renegotiated or repaid EUR 1.6 billion of our most expensive bank loans. Looking through 2026 and beyond, CTP maintains a conservative debt maturity profile. We repaid EUR 350 million of bonds maturing in January, and our only remaining bond maturity in 2026 is EUR 275 million maturing at the end of September. Looking further ahead, maturities remain limited over 2027 and 2028 with less than EUR 1 billion in total outstanding. Our liquidity at the end of 2025 stood at EUR 2 billion, comprised of EUR 700 million of cash and our EUR 1.3 billion RCF, more than sufficient to meet our cash needs for the next 12 months. The average debt maturity stands at 4.8 years, and the weighted average cost of debt was 3.3%, which represents only a marginal increase compared to year-end 2024. We do not expect a material increase in our average cost of debt as our marginal cost of funding is currently below 3.5% for the 5-year midterm period. Regarding the midterm outlook, a key message here is that the medium-term growth outlook for CTP remains unaltered. At our 2025 Capital Markets Day, we introduced our ambition to double the size of our portfolio to 30 million square meters. We expect to grow top line income around 15% per annum, driven by rental growth in our operator business alongside double-digit organic GLA growth from our developer business as we build on our unrivaled land bank at 10% yield on cost, supported by our growth engine as it seeks attractive global investment and growth opportunities. Digging deeper into those attractive return drivers. Firstly, we have the operator, over 1,500 supportive tenants who pay on time, stay with us and grow with us. Secondly, we have our development business, led by the strategic land bank of more than 33 million square meters, either on balance sheet or under option, located mainly around our existing parks. This is the key component of our portfolio growth ambition. And thirdly, we have the growth engine, the global identifier of shareholder value-accretive land-led acquisition opportunities to continue to deliver high returns well above our cost of capital. We also continue to see above inflationary rental growth across our markets, supported by income reversion capture, positive near-shoring trend, production in Europe for Europe, and ongoing e-commerce growth driven by rising disposable incomes across our strong Central Eastern European region and our Western European markets. Previously, unlike the rest of the sector, we did not capitalize interest on development activities, which made comparability between companies for investors more difficult and made CTP appear more expensive on a simple earnings multiple basis. Going forward, we now capitalize interest to provide reporting harmonization with all other European real estate companies. Following this change, we now set our company-specific adjusted EPRA earnings per share guidance for 2026 at EUR 1.01 to EUR 1.03. This implies year-on-year growth of 9% at the lower end of the range, rising to 11% at the top end of the range when compared to the 2025 result. In summary, CTP delivers leading shareholder returns as a growth business with income and cash flow growth, development profit growth and the growth engine lever through expanding our global exposure. Thank you for your attention. We now welcome your questions.
Operator: [Operator Instructions] With that, we'll take our first question from Marios Pastou from Bernstein.
Marios Pastou: I've got 2 questions from my side, one on the development pace and then one on capitalized interest. Just firstly, on development. So you had some delays in 2025. You also then added Italy. I'm just questioning why there isn't any upgrade really to the guidance range for the development targets for 2026, and whether there's any kind of room to beat on this going forward? And then secondly, on capitalizing interest, I suppose another question really on why you've decided to implement this change now. Not all companies do this, and whether you'll continue to headline both numbers going forward?
Richard Wilkinson: Yes. Thanks, Marios. I'll take the interest capitalization question first. look, as we've been on the market now for 5 years, if someone wants to look at the real estate sector, they fire up their Bloomberg and they sought companies by earnings multiples, if everyone else is capitalizing interest and we are not, we screen expensive compared to the market. So basically, what we're doing is we're just aligning ourselves with the standard market practice of all the logistics players. And the timing, we think that -- we've increasingly heard from investors that when they look at us first, they think you screen expensive. And then when we dig in, we understand better why that first look isn't always helpful. We understand investors are time poor. So we want to try and make it easy for them to have a simpler comparison going forward. And on that basis, we will publish the EPS targets and results, including the capitalization, not excluding it. Regarding the development pace, maybe I start and then Remon maybe comes in. Regarding the guidance for 2026, we're coming out with something that we are very confident that we can deliver. We think the 1.4 million to 1.7 million is something that is very achievable with us. The lower end of that range would be a new record for deliveries for us, but we're confident that we can reach that. We know we missed on the EPS guidance for last year, and we don't want to disappoint the market in any way going forward.
Operator: Our next question comes from John Vuong from Kempen.
John Vuong: Just on the pre-let for 2026, could you elaborate a bit more on the mix of developments in existing and new locations and how that compares to last year? And have you started relatively more developments in existing locations essentially? Or did leasing start a bit slower than last year's pipeline given the 30% pre-let rate?
Richard Wilkinson: Yes. Thanks for the question, John. Yes, regarding the overall pre-let, we stand at 30% at the start of the year, which is in line with our 30% to 35% range that we've been doing over the last years. In terms of the existing parks, the pre-let is 23%; in new parks, the pre-let is 62%. So consistent with what we've been doing over the last years and what we've been reporting in parks, where we know the demand, where we understand the tenant requirements coming up, we are willing to start with a lower pre-let ratio. And finally, I would also highlight that we have another 175,000 square meters of pre-let projects that we have not started yet. So you don't see those in the pre-let ratio.
Robert Jones: John, this is Rob Jones. The other thing to add is, we're still very comfortable on our 80% to 90% target for pre-letting at delivery for '26. We obviously delivered 88% in 2025, so very much towards the top end of that range, and are happy to guide for that 80% to 90% again for 2026. So yes, we're pretty comfortable there.
Operator: Our next question comes from Jonathan Kownator from Goldman Sachs.
Jonathan Kownator: Just coming back to the guidance, please. So 2 questions really. The first one, I think your guidance previously excluded Italy. Now it does include Italy for EUR 200,000. So overall, the entire amount has not changed, meaning that it's probably a bit lower for the rest of the business. Is it just risk management; ultimately, that's the amount of space you're comfortable having to let or deliver as a package? Or are there differences that you've noticed in terms of appetite for different countries? That's the first question. The second question, please. The growth implied by your guidance from the top line seems to be a bit stronger than the growth at the bottom line, and yet you highlighted that your marginal cost of debt is pretty close to the in-place. So is there something that we're missing here? Or are you expecting some additional costs that we need to be aware of?
Robert Jones: Jonathan, I can touch on both of those, and I'll pass over to Richard for part of the second half, the second question. So on the guidance for deliveries for '26, you're absolutely right, 1.4 million to 1.7 million square meters. We initially announced that '26 guidance, obviously, towards the second half of last year prior to the Italy transaction. But it's important to understand that we obviously had a high degree of probability internally that we were going to complete on that Italy transaction. So when we gave that raised guidance, and as Richard touched on earlier, even at the bottom end of the range, it's still a record in terms of what we've delivered in previous years. That included our expectations for the Italy deliveries of 200,000 square meters, which, of course, is already substantially pre-let for '26. And when you think about Italy going forward in your model, we are guiding to 250,000 to 300,000 square meters of deliveries from 2027 looking forward, so an increase thereafter. So I guess the takeaway from that is, do we think that there's further upside in the 1.4 million to 1.7 million? No, very comfortable with the range and it includes Italy. Just on the top line growth versus bottom line, so you're right in your assessment. But I think one important point to make is, yes, our weighted average cost of debt today, which is about 3.3%, is very similar to our marginal. We did debt issuance at the start of the year where we issued 4.5-year money at 3.375%. So very, very close to our weighted average cost of debt. But don't forget, we do have a debt instrument bond that matures in September this year. I think, remember, the coupon on that is 0.625%. If we refinance that with, say, 5-year money today, that would probably cost 3.4%, 3.5% all in. So it's important to be aware of that. But obviously, then looking thereafter, from '27 onwards, we're then in a position where we've got no refinancing upcoming that has a notably different coupon to our marginal cost of debt. Richard, I don't know if you want to add anything to that?
Richard Wilkinson: No. I mean, unfortunately, we never see the top line flowing one-to-one through to the bottom line. Of course, we would love to see that. I think one of the things to please bear in mind in this year is, also we'll be building up a team in Italy and there's some costs associated with that. And although we have the pre-let deliveries to come, they're coming in Q4. So there's not going to be a lot of income to offset the ramp-up in the costs. Secondly, we've continued to investigate the opportunities in the Vietnamese market and are looking to build up a team there over time as well.
Robert Jones: And of course, as you -- sorry, go ahead. I was going to say, as you say, despite those points that Richard makes, we're still in a position where at the midpoint of our earnings guidance for '26, it still represents double-digit EPRA EPS growth year-on-year despite that investment we're making in the business.
Remon Vos: And maybe to add also for you, Jonathan, it's also -- for the cost of debt is also the annualized impact from '25. So you cannot only look at '26, because, yes, as Rob explained, we had, of course, the bonds in January and then in September, but it's also the annualized impact of '25, which is, of course, reflected already in the average cost of debt, but still has an impact on our '26 EPS. So if you do the math, and you can do it relatively easily, also if you look to the refinancings we have done in '25, you see that the impact is still a few cents on the overall EPS.
Jonathan Kownator: Okay. So if I understand correctly, cost of debt and admin cost you're building as opposed to being a bit less confident on the top line, right?
Remon Vos: Correct.
Richard Wilkinson: Yes, absolutely correct.
Remon Vos: If you want, I can add something on the supply, because it keeps coming back, this question. So first of all, we look after the income-producing part of the portfolio. We make sure that we are happy with the occupancy rate. And then we will continue to build if we can lease. So we are going to not build buildings if we are not confident we can lease those buildings. So we balance between supply and demand. And while doing that, we do gain market share. So if there's an opportunity to develop and to lease properties, we do. And that's what Rob explained in his presentation, as we've been doing over the past years, we do gain market share. So we build as soon as we believe we can lease.
Operator: Our next question comes from Frederic Renard from Kepler Cheuvreux.
Frederic Renard: First of all, let me flag that your line is not really great. So I'm not so sure it's just me. So just flagging. Then I would like to comment on 2 elements. First, on the long-term guidance of 30 million square meters. Even with Italy today, the pace of growth is important, but far from the level which would bring you to a portfolio of 30 million square meters by 2030. So it seems basically that your existing market is not absorbing what you are delivering at the moment from an external point of view. Can you comment on that first? And then maybe on the second question, if I compute your vacancy in terms of square meters, it looks like your portfolio is at 1 million square meters of vacancy, which is quite sizable. What is structural here in the mix? And finally, on the pre-letting, you mentioned 88%. But actually, if you compute the pre-letting in Q4, it came close or slightly below 80%. So can we conclude that there is some kind of a softer demand in the market at the moment versus what you had in mind 1 year ago?
Richard Wilkinson: Yes. So in terms of our midterm ambition, I mean, we said 30 million we would like to achieve target. It's an ambition, we want to get to 30 million square meters by 2030. If you compound our portfolio by 12.5% per year for the next 5 years, you're going to get to somewhere around 26 million, 26.5 million square meters. And there's a small gap there, but we think that there may be opportunities or there will be opportunities to find one or the other attractive acquisition over the next 5 years. We talk about a relatively midterm perspective there, Fred. So I think we're comfortable with that level of ambition and our ability to realize that. If we can do 15% a year, which would be the top of our organic growth rate, then we get almost to the 30 million square meters. But it's our ambition and we're comfortable with that at the moment. In terms of the vacancy, as Remon just said, we're always balancing supply and demand in our parks and in and around our parks. Our business model is to run a vacancy of -- we target around 95% occupancy going forward. And as the portfolio grows, that means the absolute square meters of vacancy increases. So yes, at some stage, that gets to 1 million square meters, that's simple math. That's part of our business model that we live with, we accept that vacancy rate, because we feel that gives us a competitive advantage when tenants are looking for space in the short term, because not everyone is planning years in advance. Sometimes people need space quickly, and then the ability to act quickly and grab a tenant and meet their demand puts you in a better position to retain and grow with them then also going forward. And regarding the pre-let for Q4, look, across the year, we delivered 88% towards the top end of our 80% to 90% guidance. We try not to get too hung up on the volatility of any one quarter. Short-term trend is not our target. As Remon said in his presentation, we're in it for the long term. That's why we have the land bank that we have mostly in existing parks or with the potential to build a new park of more than 100,000 square meters for each park. That's the real value driver for us and... [Technical Difficulty]
Operator: It seems we have lost audio with our speakers. Please stand by whilst we're getting them reconnected.
Robert Jones: Yes. Let me continue. I think Richard dropped out.
Operator: Okay. Hold on. I'll just transfer you back over, because I've moved you out of the main room. I'll transfer you back over now.
Remon Vos: Okay. I'm still here as well.
Operator: We'll now continue.
Robert Jones: Sorry for the connection drop. I think Richard dropped out, but let me continue on where he stopped. So if you look to the pre-letting as always, so I think last year, when you look to the Q3 of '24, we were at 95%. At the end of the year, we came also within the range. So there is always a bit quarter-by-quarter movements and that comes indeed back to our business where we are mostly developing in our existing business parks. If you also look to the quantum of leasing that we are doing, yes, 1 million of vacancy might seem a lot, but we sign 2.3 million square meters of leases each year. So if you look to the overall amount of leasing that we are doing, 1 million square meters is less than half a year for us. So yes, of course, with the scale of the portfolio, that becomes a larger number. But in our overall leasing capacity, that's ultimately important for us, because it all comes back to tenant demand. That is ultimately the key thing when we are looking for, are we starting the next development, where are we starting the next development, and where do we see growth.
Operator: We'll now take our next question from Vivien Maquet from Degroof Petercam.
Vivien Maquet: I think your line dropped again, but I hope you will hear me. A couple of follow-up questions from me. Maybe when it comes to the deliveries, can you quantify the volume of deliveries that was moved to Q1 2026? And if possible, what kind of level of pre-let do you have on this project? And maybe I ask my other question afterwards, if you can hear me?
Robert Jones: Yes, sure. So if you look to the deliveries, we came out on the lower end, of course, of the 1.3 million to 1.6 million that we guided for. We were planning to be more in the middle or the higher end of the range, but that's business. So if you look to what has shifted, that's basically, say, 150,000 square meter or so to the next year. So that's also -- it's reflected in the overall pre-letting, of course, for this year, the 30%. But like Richard mentioned, actually, the 30% might look a bit low compared to previous years. But on top, we have the 175,000 square meter of projects leased that haven't started yet. Some of that also will be delivered in '26. So it's always a mix of those elements. So that is basically the impact on the shift of deliveries, and that will help a bit in '26, and that's why we are so comfortable with the 1.4 million to 1.7 million for this year.
Remon Vos: And let me add to that, maybe an important one, is structural vacancy. There is nothing like that. There is not buildings which are empty for years and years and years, okay? So it's just adding supply to the market and then you need the market, you need some time for the market to absorb all that space, and that's what we are doing. So when it comes to buildings which have been vacant for a longer term, then I can think of properties in Germany. As you remember, we entered the German market through an acquisition of buying Deutsche Industrie, which is a mix of some fantastic locations, redevelopment opportunity, but all the buildings, so there is some vacancies, and we need time to refurbish those buildings, which have started, but that takes a bit of time. It's all part of the budget and it makes a lot of commercial sense. But then you have buildings which will not produce income for a while because you're doing some refurbishments now. And there's some vacancy in the German portfolio, you can see, but our core portfolio, all of the stuff we built, there's no structural vacancies. There are some vacancies here and there because of the supply. But again, this goes down to CTP's business model. So I suggest you have a good look and listen to all the nice videos we have done to understand the way we run it. It took us more time to get to 15 million square meters. It took us 25 years to get to 15 million square meters. It's going to not take us 25 years to add another 15 million square meters, to grow to 30 million, because we know the game of how to develop and with whom, and with all of the clients we have, that gives us great opportunities to continue to do what we do. But yes, 5% from 30 million is 1.5 million square meters.
Operator: Our next question comes from Eleanor Frew from Barclays.
Eleanor Frew: One question, please, on the reconciliation between your company-specific EPRA EPS and EPRA EPS. The adjustment this year was a lot larger than last year. Can you talk us through the reasons for that? And also, what should we expect on that adjustment moving forward? Is this the new run rate?
Robert Jones: There were some one-offs in that adjustment. And I think we already discussed that in the H1 and Q3. I think on the tax side, you saw a positive, especially in the first half of the year. So the tax adjustment for '26 will be lower. That's one. There are also some in the other expenses where there were some one-off adjustments, for example, related to some transaction that in the end did not take place, which is booked in the other expenses and therefore, adjusted, of course, in the recurring elements. So there are some of the one-offs in '25, which are slightly higher than I would expect on a run rate basis. So that should be less in '26.
Operator: Our next question comes from Steven Boumans from ABN AMRO - ODDO BHF.
Steven Boumans: Some technical questions for me. What's the assumptions on the capitalized interest? So what's the interest rate that you use and what loan on cost do you assume? Second, what's the impact on the average yield on cost for the change there due to the capitalized interest? Can I assume that will increase the cost of development? And last one, do you assume a similar number of shares year-end '26 as in '25?
Robert Jones: Yes, Steven. So in terms of -- go on. Marios, do you want to go -- we had a problem with our line. Yes. So apologies for that. And I hope that you can hear us properly, because Fred was saying that he couldn't hear us and then we dropped. So apologies for that technical lapse. In terms of the capitalized interest, what level do we use? We use the actual cost in the balance sheet, so the average cost of debt. So for this year, it's 3.3%. In terms of the yield on cost impact, that would be somewhere around 30 basis points. And there was a third question as well, but I lost the connection on that one. I'm sorry, Steven.
Steven Boumans: So the last one, the number of shares you assume in your full year '26 outlook, is that the same as in '25?
Robert Jones: Yes, we're not -- yes, it's slightly higher because it incorporates the dividends that we're paying. As you know, we proposed a final dividend of EUR 0.32 for the full year. We'll also have an interim dividend later in the year. Based on past behavior of the shareholders and expected behavior, we would expect the majority of that to be taken up in scrip. So there will be an increase in the number of shares as a consequence of the scrip dividend. But otherwise, we're not planning on an increase in the share capital. As I said in the presentation, we don't need to raise equity to fund the development pipeline, the 1.4 million to 1.7 million that we're very confident to deliver.
Operator: Our next question comes from Suraj Goyal from Green Street.
Suraj Goyal: Hope you can hear me. The rent levels for new leases in '25 were around 4% higher compared to 2024, but I noticed it was lower in Bulgaria, Serbia, Hungary and also flat in Romania. I wanted to find out what the reason for this is, and if this is reflective of some of the softness or normalization in operating fundamentals across Eastern Europe. And then are you able to give any color on the market split of the 3.8% ERV growth that you quote?
Robert Jones: Yes. So maybe I'll deal with the technical part, maybe Remon will pick up on the overall tenant demand and how we see rents going overall. Yes, I mean, it depends a little bit country by country as to where we're leasing within that country. So certain parks have higher rent levels than others. So if you're very close in town -- in the capital, you're going to get a higher rent than if you're leasing in one of the regional cities. So the mix there across the countries is generally to do with where we're doing the leasing in that specific quarter or in that year. So generally speaking, if we look at our ERVs, the ERVs across the portfolio are increasing. So location for location, like-for-like, we're seeing across the portfolio, a general increase in the rent levels. But we don't expect that to -- that's different location for location, depends on the supply, on the demand in the individual location at the time. Overall, you will see rents continuing, we think, to grow inflation plus over time. There will be markets where it's going quicker, at a point in time markets where it's going slower. But overall, we're very happy with the rent level development that we're seeing across the whole region.
Operator: Our next question comes from Vivien Maquet from Degroof Petercam.
Vivien Maquet: Sorry, I had 2 other questions that was skipped. First is on the retention rate. Just trying to understand the decline to roughly 81%, if I recall. And how do you see a normalized retention rate going forward?
Robert Jones: Yes. Look, I think our retention rate historically has been 80% to 85%. There have been times where it's been a bit higher. There have been times where it's been a bit lower. We would think that generally, if we look, 70% to 75% of our new leasing, last year was 71%, is done with existing tenants. So we would think that 80% to 85% is a reasonable rate to expect in terms of tenant retention. So you're retaining the vast majority of your tenants, but you won't never keep everyone.
Vivien Maquet: All right. And then one last question on the goodwill impairment. Can you comment on that one?
Robert Jones: Yes, sure. That goes to our German acquisition back in 2022. And what we see -- last year we saw a nice uptick in the valuations of our portfolio in Germany. And as the valuations increase, then the goodwill that we recognized at the time of the acquisition decreases.
Operator: Our next question comes from Bart Gysens from Morgan Stanley.
Bart Gysens: Quick question on the dividend payout ratio. So you're saying that for '26, the dividend payout ratio remains unchanged. But of course, the accounting policy of starting to capitalize interest increases your reported EPS by 10%. So will you now start paying a higher percentage of this previously more cash EPS? Or will you gravitate towards the lower end of that range to reflect this accounting policy change?
Robert Jones: Yes. Bart, good question. Yes, I think that we'll end up gravitating towards more 70%, 72%, 73% rather than historically, we've been 75%, 76%, 77%, something like that.
Bart Gysens: But that would still mean a higher percentage payout, right, on the previous...
Robert Jones: No, you end up -- if you're 70%, you're almost the same. There shouldn't be a material increase in cash out as a consequence of the capitalization of the interest.
Operator: We'll now take some questions from the webcast. Our next question comes from Laurent Saint Aubin from Sofidy. Can you please comment on the decline in your client retention rate to 81%?
Robert Jones: So we already answered that question. So yes, look, like I said, we're targeting generally expecting to be between 80% and 85% in our tenant retention. In '24, we were 84%; in '25, we're 81%. So very comfortable with that.
Operator: And then our next question is from Wim Lewi from KBC Securities. What is expected impact of the capitalization of interest costs on your yield on cost expectation?
Robert Jones: Yes. Again, that's another question I answered earlier. It's around 30 basis points.
Operator: And then our next question from Crispin Royle-Davies from Nuveen. Are you going to keep the same payout ratio against the new definition of earnings, or adjust this downwards to keep cash payout ratio the same?
Robert Jones: Yes. So payout ratio will stay within -- or move towards the bottom end of the 70% to 80% payout range. Cash outflow for the business remaining relatively unchanged given the majority of our divi is taking scrip.
Operator: With that, we have no further questions in the queue at this time. So I'll hand back over to the management team for some closing comments.
Remon Vos: Yes. So thank you very much, everyone, for your questions and your interest. I'd just like to underline that we continue to see really attractive midterm growth potential, primarily in and around our existing CTParks, but also with the addition of Italy and hopefully an addition in Vietnam, we think that we have everything in place for the next leg of growth. And we wish you all a good day. Thank you very much for your attention.
Robert Jones: And you're invited for the Capital Markets Day in September, right, in Warsaw.
Remon Vos: Yes, of course. Sorry. Thanks very much.
Richard Wilkinson: Thank you very much, everybody.
Operator: Thank you all for joining. That concludes today's call. You may now disconnect your lines.