Good morning, everybody. My name is Luca Lucaroni, Investor Relations Director. I'm happy to be on this call with Evert Jan van Garderen, our CEO, and Roberto Fraticelli, our CFO, to present Eurocommercial's result for the year 2024. The agenda for this conference call is presented on this slide. Evert Jan van Garderen will talk about the operational result of the company, followed by Roberto Fraticelli, who will discuss in more detail the financial result. Evert Jan will finish the presentation with some closing remarks. We will then open the call for any questions and comments you may have.
Thank you, Luca, for introducing us and presenting the agenda for today. Good morning, everyone, and thank you for joining us this morning. I will start with an overview of the operations of Eurocommercial during the financial year 2024, and we'll finish this presentation with some remarks on the share buyback program, the dividend proposal, and the guidance for 2025. 2024 was a year of internal growth, which we achieved through the re-merchandising of several of our shopping centers, including our flagships, Woluwe Shopping in Belgium and Carosello in Italy. The current $3.9 billion retail property portfolio comprises 24 shopping centers and provides diversification in terms of geography, size, and type.
Our four countries, Italy, France, Sweden, and Belgium, are shown here, weighted by value. As a consequence of the external valuations at 31st December 2024, the portfolio spread changed slightly compared to December 2023. Italy went up from 44%- 45%. Belgium and France remained the same at 14% and 21%, respectively, whereas Sweden reduced from 21%- 20%. In addition to providing a good country diversification, our shopping centers are well spread in those four countries and are all located in wealthy regions like, for example, northern Italy or close to the Swiss border near Geneva, or in the wealthy catchment of Woluwe Shopping in Brussels. This slide provides the maps of the four countries showing where our 24 shopping centers are located.
Italy remains our largest market at 45% of the portfolio, a weighting that we're happy to maintain, as all the positive economic and retail indicators that initially attracted us to the Italian market remain, namely extremely high wealth levels in northern Italy and in particular in Lombardy, where our three Italian flagships and CremonaPo and Cuneo are located, very low online penetration, which has only just reached 10%, low levels of household debt, and more importantly, very low shopping center density and therefore competition, partly because shopping center development started relatively late in Italy from the early 1990s, meaning that even today retail densities in our Italian catchments are half of the French ones. The existing portfolio also provides asset diversification with its five flagship shopping centers balanced by the remaining 19 suburban hypermarket-anchored shopping centers.
The five flagships are located in their respective country's capital or main economic cities and are important shopping centers in the national context and retail hierarchy. These flagships attract a broad international talent base and have a higher discretionary spend component, particularly fashion. By contrast, our 19 suburban hypermarket-anchored shopping centers have different and more defensive characteristics, with over 60% of the floor space devoted to a broad range of essential and everyday retail, including groceries. Most were strategically sited and originally developed by the hypermarket themselves in the wealthy catchments of important provincial towns and cities, and these types of shopping centers provide a broad mix of both national and regional tenants and an increasing range of services for their more local communities. The company showed a strong operational performance in 2024.
On the slide, you see an overview of the important operational metrics for the year, which underpin that statement. I will comment in more detail on each of these metrics in the remainder of this presentation. Like-for-like rental growth was 3.5%, well above our 10-year average of 2.8%. The growth was driven by indexation and turnover rent, although the indexation was lower than in 2023 due to much lower inflation. The rental growth was obviously the driver behind the 5.9% net property income uplift. We are pleased to be able to report that on 275 renewals and relettings, an average rental uplift of 4.5% was achieved, and that is on top of indexation. These lease transactions represent 18% of the minimum guaranteed rent of the portfolio.
We were able to attract new tenants with our 104 relettings, achieving a much higher uplift of 9.1% and confirming the continuing strong demand from retailers to open new stores in our centers. The highest uplifts were achieved in Belgium and Italy. Over the last 12 months, the Italian leasing team signed 92 new deals, resulting in an overall rental uplift of 7.9%. Forty-seven of these transactions were new lettings, producing an overall increase in rent of 14.1%, with the highest uplift achieved in Collestrada, 22%. In Belgium and Woluwe Shopping, the leasing team successfully concluded 24 lease renewals and relettings, resulting in an overall rental uplift of 6.6%, including 13 new lettings, producing an increase of 16.6%.
These figures demonstrate that our prime portfolio continues to be well positioned for retail space through an expanding tenant base under sustainable conditions and affordable rent levels, while active tenant rotation and the regular introduction of new concepts ensures that our shopping centers remain attractive and relevant for their customers. Low vacancy is usually a good indicator of the quality of the properties. Over the last four years, we have reported vacancy rates in our property portfolio ranging between 1.3%-1.8%, with an average of 1.6%. Last year, the upper vacancy rate reduced steadily down to 1.4% by the end of December. The company has always been known for its low occupancy cost ratios, and we are therefore pleased to report a 9.8% occupancy cost ratio for our portfolio as per the end of December 2024.
This percentage is still one of the lowest in the industry and implies that the rents are affordable and sustainable, as was also confirmed by the full rent collection figures that we have again reported. The service charges and property taxes have remained stable over the last three years, whereas the rent increased resulting in a slightly higher OCR than three years ago. Last year, retail sales in our shopping centers increased by 2.7% compared to 2023, with all four markets producing positive growth. Belgium performed particularly well as a result of the re-merchandising at Woluwe, a process we internally refer to as the musical chairs. If we look at the various sectors, we see that most sectors performed well last year, with some clear winners, which were health and beauty, sport, books and toys, food and beverage, and services.
This slide illustrates the fastest growing sectors in our malls over the last three years, i.e., since the pandemic. The growth in terms of retail sales, which were health and beauty, food and beverage, and sport and lifestyle, with growth of 13%, 19%, and 11% per annum, respectively. The growth in the health and beauty sector was driven by a number of international brands expanding across our markets. Rituals have opened three more stores in our shopping centers, bringing their total number in our portfolio to 13, with Fiordaliso joining this autumn. The French fragrance designer Adopt opened in Passage du Havre and Les Allandes. Wycke & Cosmetics opened three additional stores in our Italian portfolio, taking the number to seven.
The sector is also seeing the expansion of specialist beauty centers such as MediMarket, who are substantially increasing their footprint and unit size to provide a range of in-store treatments in addition to their normal product range. MediMarket have recently taken on a large unit in Woluwe and opened in CremonaPo. The food and beverage sector is continuing its rapid expansion with a range of new brands, concepts, and formats. To satisfy this increased demand from both customers and operators, we have recently completed several F&B projects in our markets, repositioning food and beverage as a central pillar of attraction, increasing both footfall and dwell time. The sport and lifestyle sector also continues its rapid growth with the increasing popularity of branded sport and leisure fashion.
Many of these brands are increasingly operating cross-border, with JD Sports being particularly prominent, with whom we already have six stores covering France and Italy. Increasing demand for sneakers and training shoes has seen the expansion of specialist footwear retailers such as Courir, Foot Locker, Snipes, and Skechers. This slide illustrates the fastest growing brands in our shopping centers over the last five years in terms of floor space. I just mentioned JD Sports, but on this slide, I would also particularly mention Normal, the expanding Danish value retailer, who is present in all our seven Swedish shopping centers and are also performing well in France in both Passage du Havre and now in Modèle in the suburbs north of Paris. Fashion continues to be the cornerstone of our galleries, representing 37% in terms of mall floor space.
However, the big change in this sector is that it now comprises fewer but much larger stores. This is most evident with Inditex, who recently doubled and even tripled their store size at Woluwe and Carosello in order to showcase the latest full Zara concept. All the Inditex brands are expanding their representation and we're currently having 26 of their stores, mainly in Italy and Belgium. This slide shows the concentration of floor space of the largest fashion groups in our portfolio, who are demanding bigger stores in dominant shopping centers while vacating smaller stores in secondary retail locations. 47% of our fashion floor space is let to our five largest fashion retailers, as illustrated on this slide. With our ongoing re-merchandising projects, we can provide them with the right retail space in terms of size, layout, and design.
I will show you two outstanding examples, which are Carosello near Milan and Woluwe Shopping in Brussels. At Carosello, MediaWorld relocated into the former Coin department store, thereby creating the retail space and opportunity for a major re-merchandising, including a new full-format Zara store of around 4,600 sqm, a new Bershka, and an enlarged Stradivarius. These Inditex stores were all completed and fully opened for trading in early October 2024 and collectively became their flagship representation serving the eastern region of Milan. As part of the re-merchandising, H&M have relocated and established their latest concept in the former Zara unit next to the main entrance.
During 2024, important re-merchandising improvements were completed at Woluwe Shopping with the successful spring opening of the new enlarged Zara store, 3,300 sqm, Carrefour Market, who replaced the Met supermarket in May, focusing on fresh and quality products to better serve the essential and everyday needs of Woluwe's wealthy catchment. This was followed in June by the opening of the latest C&A concept store, and meanwhile, Inno completed the refurbishment of their 12,000 sqm department store during the autumn when the MediMarket Parapharmacy also relocated into a larger store of 675 sqm to provide a wider range of products, where most recently, Massimo Dutti relocated to a larger unit for its latest concept.
Woluwe and Carosello are examples of creating internal organic growth through delivering major re-merchandising projects to enhance the performance of our shopping centers, thereby growing the company's business while preserving the dominant position of its assets over the medium and long term. The impact of these re-merchandising projects is already visible. In the fourth quarter of 2024, Carosello's overall turnover was up by 18.1%, and the footfall numbers were up 5.7%. Furthermore, Carosello became even more dominant as Zara closed stores in competing centers, and the Inditex group increased its presence in Carosello with a full-format Zara, an enlarged Stradivarius store, and a new Bershka. In the fourth quarter, Woluwe also saw a significant increase of 6.1% in retail sales and a footfall increase of 18.7%. The re-merchandising has increased tenant demand, resulting in 100% occupancy and year-end valuation uplift of 3.3%.
In Sweden, at Grand Samarkand Växjö, the development of a new external retail store for the expanding value retailer EcoHallen is almost finished. The 8,200 sqm unit has been let on a 10-year lease and is scheduled to open at the end of this month. The development will provide a return of at least 8% on cost, which is a total amount of SEK 130 million. In the past, we developed a similar store for EcoHallen at Norrköping, illustrated in the picture at the bottom left of this slide, and we saw that investment at a yield of 6%. Our property portfolio has strong fundamentals to generate internal growth, as we achieved with the re-merchandising strategy executed at Woluwe and Carosello. To summarize, what are these strong fundamentals? It's the retailer's flight to quality, no supply of new retail space, and strong demographics.
Point one, retailers are prioritizing fewer but larger and fit-for-purpose stores. In order to create a unique customer experience, brands are increasingly offering new products and services, which can be easily accommodated in shopping centers in dominant commercial areas. Most retailers have an omnichannel approach and need physical stores to be successful. E-commerce is no longer a threat but an opportunity, with consumers shifting towards experience-driven retail, where physical stores play a crucial role in brand engagement. With our portfolio, we can serve this demand from retailers. Number two, while new large-scale developments face restrictions in many countries and building permits are harder to obtain, this creates a competitive advantage for us. Limited new supply means that our existing high-quality assets become even more valuable, reinforcing our dominant market position in our catchments. Point three, beyond financial considerations, demographics play a pivotal role in our success.
Our presence in densely populated areas with above-average purchasing power and low unemployment rates ensures a strong customer base with consistent demand for quality retail spaces. It is very clear that our strategy of creating internal growth through re-merchandising is already showing positive results. We intend to repeat this strategy over the next two years in Italy at I Gigli, Collestrada, and CremonaPo, where we have opportunities to deliver growth from similar re-merchandising projects, but also in Ingelsta in Sweden. In addition to those four shopping centers, we continue to identify similar opportunities at other assets in France, Italy, and Sweden. Before I hand over to Roberto for discussing the financial results, I would like to say a few words about some of the ESG activities listed on this slide.
We finalized the double materiality assessment to identify key ESG topics and to evaluate Eurocommercial's impact on the environment and society. We have identified six material topics on which we intend to report in the future. Three items concern environmental topics, two items concern social topics, and one item concerns a governance topic. However, the very recently published so-called omnibus proposal of the European Commission, if endorsed by the European Council and the European Parliament, will, on the basis of currently available information, imply that Eurocommercial is no longer in scope for the Corporate Sustainability Reporting Directive, the CSRD. We are monitoring the further developments to understand what will be applicable for the company. Meanwhile, we will continue with all our planned ESG activities.
The recertification of our assets under the new BREEAM in Use Protocol version 6 is progressing well, and the certificates we received are either excellent or very good scores. We continue to make further progress with our sustainable finance goals, having added green and sustainability-linked loans for financing Belgian, Italian, and Swedish shopping centers during 2024, which loans Roberto will cover in more detail as part of the financial review. This slide provides the major ESG achievements reported over 2024, but also an update on the percentage of green leases out of the total leases per country and the electrical vehicle charges in our shopping centers, as well as the gas removal we are achieving. Much more detail regarding our ESG activities for each of our countries can be found in the comprehensive country commentary sections of our press release. This is the moment to hand over to Roberto, who will discuss in more detail the valuation of our property portfolio, the funding, and the financial results.
Thank you, Evert Jan, and welcome everyone. We'll just have a quick look. The first slide is the financial performance in 2024. In this slide, we are giving you the overview of the most important financial metrics, and that's really important. We are going to look at them more in detail in the coming slides. As you see, as Evert Jan already said, the property investments went up to $3.9 billion. That's a + 3.1%, which is very, very important. The loan-to-value ratio went down from 42.5%. It went down to 41.3%. That's also thanks to the fact that the debt, the net debt, actually remained stable to the EUR 1.6 billion. So that's very important.
That also, of course, caused an increase in the EPRA NTA per share, which went up 5.6% to EUR 41.79. If we then move to the property income and the profit and loss, we see that the net property income went up 5.9%. That is a strong increase up to EUR 197 million. That is mainly due to two things. One is, of course, these very good results of our property. On the other hand, we also managed to do some savings in the cost. We hope you appreciate that. That leads, of course, to direct investment result of EUR 127.9 million. There, it is important to consider that the interest expenses were capped thanks to the 80% interest rate hedging level, which shielded us from the strong increase in the Euribor this year.
That allows us to propose a dividend of EUR 1.80, which is also an important increase of almost 6% compared to last year. In the key financial metrics, you see the most important one. The average cost of debt, as we said, stayed stable. Actually, it diminished a little tiny bit, but that is very important. The interest coverage went down from 3.7%- 3.5%. That is due to the EUR 5 million increase in interest expenses. You saw also the improvement in the net debt to EBITDA, which went from 8.9%- 8.5%. We also showed the apprehended LTV, 42.8%. Of course, we believe our LTV ratio is much more relevant. You also saw the average loan maturity from 2.7%, it went up to 3.3%. That is also thanks to the loan renewals that we did during this year, which we will discuss further in the presentation.
We were also busy with hedging. The average interest rate hedging maturity went up from 5.3 years to almost 6 years. If we then go to valuations, what we see is really interesting because the valuations can depend on several factors. One of them is the net initial yield. We see that the net initial yield is actually stable because it was 5.8% last year, and this year is only 5.7%. A minimal change. That means that the value is actually value which has been created in the properties, and that is due to an increase in the NGRs and the ERVs. That is very important. I think we owe big thanks to our property and leasing teams who have been working flat out to achieve these results.
It also tells us that if yields remain more or less stable, then for the future, we can also see that the possible increases in MGRs and ERV can have possible important results on the valuation also for 2025. We look also at the valuation split, which is something that we usually do. You see five dominant flagships. The yield actually stayed the same at 5.4%, and there was a small improvement from 6.2%- 5.9% for hypermarket anchored shopping centers. The values increased for both, and that's extremely important. Now, to a slide which we are particularly proud of, Luca, Jakob, Tom, and Neil, they all contributed to this effort. We thought it was also nice, as Evert Jan van Garderen mentioned before, to put some green color here and there because indeed the renewals of the loans that we did were actually green.
It's either green and sustainability-linked green loans, sustainability-linked loans. There are three loans which are not green, but they're easy to explain. Let's say the last two, the small ones, we just extended their duration by one, one and a half, two years so that they could match the extension of the larger brothers which were expiring, which we will see on Fiordaliso and Igigli. The other one is the SEK 550 million in Valbo. We are finalizing the papers so that we can also, in discussion with the bank, also qualify that as a green loan. Give us some more time on this. Our usual financial summary at the 31st of December 2024. What's important to see is, of course, total net borrowing stayed there at EUR 1.6 billion.
The average term of the aggregate increased from 5.3%- 5.9%, and the overall interest stayed at 3.2%. What we decided to do this year was also to give you a split of the loans which are expiring in 2026 and 2027, just to give you the overview. What you see, the main loans which are expiring in 2026 are on the three flagships, which is Italian flagship, sorry, which is Fiordaliso, Carosello, and I Gigli. There is also an amount on C4, a Swedish asset. C4, we have already started discussions with the bank. We are optimistic about these discussions. In Italy, Luca and the team have already started also the renegotiations. Actually, on one of these loans, we are pretty advanced. We hope we can finalize it by the end of H1. We are very hopeful with these negotiations.
If we look already at 2027, what you see is that Kuhn is expiring. We're also very positive. We have a strong relationship with ING, which is financing the asset, and also a very strong relationship with Nordea, which is financing the portfolio in Sweden, which expires in 2027. Lender shares, as usual, 34% in the Netherlands, strong Italy and Germany with 25% and 22%. We got Sweden at 13% and France at 6%. If we go to the interest hedging, also we need to thank Luca and the entire team in Amsterdam. As you see, the top gives you the past. The bottom gives you expectations and future. What you see is actually the hedging has been stable at 80% or slightly above or slightly below. That helped us keep the interest expenses stable, as we said.
We also put for a comparison the curve of the Euribor so that you can actually see the movements in the Euribor during these years. At the bottom, you see the hedging ratio. As we said, our policy is to have 80% of our net loans hedged. That is also the case for the foreseeable future. All in all, we think a very stable financial picture for you to take into consideration. If we go to the financial position, and that is the net team doing this fantastic job, what we usually put here for you is the financial position on the right-hand side with the FRS figures. You see the increase in property investments. You see the stable net borrowings, and you see also the increase in the NTA.
Of course, per share, the increase in both in all three items, actually, net asset value, adjusted net asset value, and net NTA. If we then go down to our bridge, you see if we start from the 39.59, which we had in December 2023, we add the investment results. We add the direct investment result. We take out the dividend distribution. As you can see, the share buyback equalized the stock dividend that we had. For EPRA, we have to adjust for the fair taxes and the financial instruments. The other is mainly exchange rates, the euro SEK impact that we have in our accounts. That gets us to a final EPRA NTA of 41.79, which you have seen. We go down to the income statement. There as well, IFRS figures on the left-hand side.
You see the rental income going up from EUR 215 million- EUR 219 million. A nice increase of 4.4%. Net income increased by EUR 9.9 million. Direct investment result increased by 3.9%. Of course, there is the limited impact of the interest expenses, which is thanks to the 80% interest hedging that we have put in place. We are almost there. Direct investment result here also bridged. Just to give you the overview of the impact on your direct investment result, you see we added EUR 7.3 million of rental income. Then we have an amortization of lease incentives. As Evert Jan van Garderen has told us, we have a lot of re-merchandising that we've done in our shopping centers. That is really important. We also had a positive result for bad debts. We actually managed to collect some of the bad debts we had already lost hope for.
There are some one-off here. Net service charges is also positive. That means we managed to collect some more service charges than we used to. The net result is actually more positive for the company for EUR 3 million. Here you see the impact of the interest expenses, the EUR 5.3 million. IT expenses, as you know, we are busy with our digitalization program. We got some very nice investment, which TISE has been making with this team to move us forward in this digitalization path. We had a one-off in Sweden for corporate income tax, which is also helpful. Others just a little mix of everything.
That gets us to the EUR 127.9 million of your direct investment result for 2024. Last but not least, we tried to give you also the picture taking into account the EBITDA. As you see, rental income, property expenses, net service charges, company expenses, other income and expenses. That gives you to an EBITDA of EUR 190 million compared to an EBITDA of EUR 181 million. That is + 5% compared to last year. Of course, you see the impact on the recording earnings. On this positive note, I would hand back to Evert Jan.
Thank you, Roberto, for presenting all the figures. I also would like to say a few words about the share buyback program, which Eurocommercial executed in the summer of 2024, as it is related to our dividend policy and in particular to the option to elect for shares instead of a cash dividend. The objective of the buyback program was to avoid dilution as a result of offering stock dividend to shareholders in 2024. We announced the start of a buyback program of our shares for a maximum amount of EUR 15 million. The program started on 30th June and ceased on 30th September, as the maximum amount of EUR 15 million was spent to buy back the company shares.
The total number of shares bought back was 640,000, representing 1.2% of the issued share capital of the company. In the press release, we included the dividend proposal, which will be tabled at the general meeting scheduled for Tuesday, the 3rd of June 2025, for approval by the shareholders. On balance, we are optimistic about 2025 and therefore propose to increase the total dividend per share from EUR 1.70 paid in 2024 to a total dividend per share to be paid in 2025, amounting to EUR 1.80. This is an increase of 5.9% and translates into a 75% payout ratio, which is our payout ratio target. This proposal implies a final cash dividend of EUR 1.12 per share. We will also offer shareholders the option to elect for a dividend in shares instead of the cash dividend of EUR 1.12.
As these shares will be charged to the fiscal share premium reserve, there is no Dutch dividend withholding tax due, which may be attractive for those shareholders who cannot obtain a reduction or a credit for the 15% Dutch dividend withholding tax. The take-up of stock dividend last year and in January 2025 confirmed that around 20% of our shareholders appreciate this option. The ex-dividend date will be Thursday, the 5th of June 2025, and the dividend distribution date will be Thursday, the 3rd of July 2025. The outlook for 2025, albeit solid for our shopping centers, remains linked to the evolution of the macro environment and also the geopolitical tensions.
On the income side, 2025 indexation in our markets will have a positive impact on rental growth, which we expect to be further improved by our renewal and reletting program and higher turnover rents, notwithstanding some temporary vacancy during the re-merchandising projects. As said before, we are on balance optimistic about 2025, and therefore, assuming no major deterioration of the macroeconomic environment, we expect the direct investment result for the year 2025 to be between EUR 2.40 and EUR 2.45 per share. I would like to conclude this presentation with a statement that, as Management Board, we are truly thankful to all our teams in the various countries for their hard work and their continuing commitment to Eurocommercial. I will now hand over to the operator for questions.
Thank you very much. Ladies and gentlemen, as a reminder, if you would like to ask a question or contribute on today's call, please press star one now on your telephone keypad. To redraw your question, please press star two. Also, ensure your line remains unmuted locally. You will be advised when to ask your question. The first question comes from the line of Valerie Jacob, calling from Bernstein. Please go ahead.
Hello, good morning, everyone. I've got a quick question. The first one is a bit broad, but I just wanted to understand how you think about Eurocommercial in terms of capital allocation in the next two years. If you can talk about maybe the CapEx that you plan to spend on development projects, if you can talk about share buyback, do you think you're going to do a new one with a dividend, and also opportunities you see in terms of disposals and acquisition? That's my first question. My second question is about your values that have been quite strong, especially in Italy. I think that's similar to some of your peers. Maybe if you can give us some color on investment markets and any transaction that maybe can support this growth. My third question is about financial costs. I mean, do you expect any increase in your 2025 guidance, or do you think they should remain around current level? Thank you.
Thank you, Valerie, for your very valuable questions. I think some of your questions, Roberto, will comment on. Maybe I should kick off with your first question about capital allocation. Indeed, we have quite some options, but one of the allocations will certainly be what I talked about, the further re-merchandising projects we have on the go. Although we are not yet in a position to give more details, we do hope that that will be the case when we come out with our first quarter results on the specifics on the various centers. We flagged at least three more in Italy where we can do the project as well as in Sweden. There will no doubt be more capital allocated. Of course, these are not always big amounts, but in order to reshuffle your tenants around, there is, of course, some CapEx involved. You said, what about the buybacks and also disposal acquisitions?
I think the share buyback for us was last year a success in the sense that we neutralized the dilution by the stock dividend. Whether we will do that again this year, we will, first of all, have a look at where we will be in the summer, whether it makes sense. I think it also depends on opportunities we might see. We have the feeling that markets are in, at least in our countries where we're active, opening up a little bit more than maybe 6 to 12 months ago. Obviously, interest does play an important role, and interest has come down rapidly in the second half of 2024. Of course, in today's world, it's quite an uncertain element as well. I mean, with the biggest jump we saw in German bonds only yesterday or was the day before.
That is something which may determine, again, the appetite in the markets. Having said that, I think appetite certainly for good retail property has increased. I think it is always a relative game. If we see other asset classes, I think retail still has good fundamentals, typically, I think, in our world of the shopping centers. That brings me to your question. What will Eurocommercial do? I think the rotation model, which we talked about a lot in the past, is probably a bit more on the horizon than it was some time ago. For example, I know it is a smaller project, but we showed you EcoHallen, which is a standalone box almost ready. I think that could be certainly one where you could say maybe it makes sense to look at some disposal there and reinvest it in really the shopping centers themselves, which is, of course, our core business. On that note, I hand over to Roberto, unless Valerie, you meanwhile have an additional question, or is that something which answers your broader, as you said, broader questions on Eurocommercial and where we're going?
Yeah. No, no. I mean, I think that's clear. In terms of contract allocation, I mean, as you mentioned at the beginning, Italy has mechanically become bigger. Is it something that you're comfortable with? Because you're spending a lot of money in Italy, are you comfortable increasing the share in Italy, or would you like to have more balance and investment in other countries?
I think we are comfortable if it would take up a bit more. Of course, we like the spread over the four countries because they do have different qualities, and that helps us overall for the portfolio. For example, Sweden, we have the exposure to the Swedish krona, and sometimes you lose, sometimes you gain. I mean, we've seen a very strong appreciation of the Swedish krona over the last days for all obvious reasons. That is then certainly a plus. No, but even if we would go to 50%, I do not think we would find that a difficult position. On the other hand, we do like the spread over the countries. As you say, obviously, it is also linked to where are the opportunities, and the next opportunities in terms of re-merchandising are certainly, sorry, certainly Italy.
That may have a tick up a little bit in the percentage. We'll see if we're good enough. Yeah. The second question, Valerie, was on values in Italy. You're absolutely right. There's been several transactions all over Europe, but also in Italy. We can recall Romast, we can recall Forum Palermo, we can recall Valicente, but there are many more which are actually in discussions, which also gives us a good idea of where the market is going. Before, we used to have just investors looking for high double-digit yields, and then it went down to low double-digit, and now we're actually looking at yields which are more in line, let's say, with the yields we would expect in a normal market.
We're getting there. If we're still there, I don't think so, but it will take a while. The direction is a good direction. If you look at the values, to be fair, as we saw, the apparent net initially did not change for the flagship. It was really value creation through the increase in net operating income, the increase in ERVs. What we are seeing is, and that is also the judgment of our independent valuers, the value creation which has been made is really translating into the value of the assets, if that answers your question before we go to finance.
The next question comes from the.
No, no, wait, because Valerie, the third question, which was finance, we expect the finance costs to go up or down or remain stable. Our expectation is for them to remain stable. Of course, they will go down a bit, but let us assume they remain stable. It really depends also from what we saw in the past two days. Things can shift so quickly. We really need to be cautious, and we really need to go ahead with our hedging program and keep the thing as steady as possible. Thank you.
Thank you.
Next question is from Stefan Olson calling from Jefferies. Please go ahead.
Yes. Good morning, and thank you for taking my questions. Two questions, actually. The first one on indexation. What are your expectations for this year? If possible, could you share a breakdown per country as you used to do? Regarding the drop in the lifetime growth in Belgium, I understand that you granted a two-year rent-free period for the Woluwe Parcours Store. Maybe could you please give us more color on this situation? Finally, besides this specific situation, what are the typical incentives granted unto tenants when these are signed, both in terms of rent-free period and CapEx? Thank you.
Yeah, thank you for your questions. On indexation for 2025, what we can say about that is that for Italy, the index is 1%. It was last year 0.8%, but it is now 1%. For the indexation in Sweden, 1.6% is applied. These are the indices we apply as from January for those two countries. If we look at France, that is a more blended percentage, which is around just under 3% if we look at our portfolio. Belgium is a monthly indexation, so that is something which is going forward during the year. In our budget, we use 2% to try to get that in our budgets. That is probably the best guess for now for Belgium.
These are the four countries with their indices. We go to your second question about Woluwe Shopping, and particularly what happened there in terms of lease incentives. Indeed, the department store renovation was one of the big steps. It is now a great store. We did contribute there to the tenant. Not that there is a rent-free, but there is certainly a contribution. That has an impact, of course, on measuring rental growth because the rental growth per country does include any lease incentives, whether it is step rents, whether it is also a rent-free period, or some other contributions. The contributions are, of course, maybe can also be sometimes in the CapEx, but it is really an effect. That is true, but it is not that it is sitting there at no rent. I must stress that.
You also asked what are the sort of lease incentives in general. What we see today, as we just talked about, is a fit-out cost. That could be a contribution to a tenant's fit-out cost. A step rent is probably something you see as well. Real rent-frees, I think these are exceptions. It is mostly, I think, more in the area of fit-out cost today than so much in the rental income, which is, of course, also, yeah, you can actually explain because we should not forget how much tenants actually invest in their stores. Certainly, these new flagships or latest concepts, they are not cheap.
If you look at it, it is not always so easy to track it, but you have to think about EUR 2,000 to maybe EUR 2,500, sometimes EUR 3,000 per sqm if you really want to build a nice store. That means that these retailers do invest a lot of money in our shopping centers, which is, of course, a sign of confidence. We like that. It means that they also believe in the medium to long term of the shopping center and therefore make the investment. For us, it's, of course, a clear sign that they are for the medium to long term. It's really a partnership. Does that answer your questions?
Okay. Just maybe one question regarding the incentives. How have they evolved over the past three years or since the pandemic, for example?
Let's say the lease incentives, obviously, we are obliged under IFRS to have the amortization of the lease incentives in the top line revenue. You have to spread them out over the term of the lease until usually the first break in the lease. There is a variety of depreciation terms. Once you've granted a lease incentive, yeah, it's something which you will also see in the years to come in your rental revenue. I think it's fair to say that the lease incentives as such haven't changed that much in terms of what tenants demand. It's more that, yeah, if you do bigger works like we do with the re-merchandising, you'll move around a lot of tenants, which means that they have to build a lot of new stores, which is what we want. Therefore, the overall lease incentive is probably bigger than if you have a mall where there's nothing happening. Yeah. It's really time-related, let's say, to the projects. That could be that if there are big projects, as we have seen for this year and we are seeing for next year, of course, there are important amounts which are being involved.
Okay. Just coming back to Woluwe Shopping, what is the remaining lease term for this lease agreement?
Let's say we entered into a brand new lease with them. The usual term in Belgium is nine years. Actually, in 2024, we signed a lot of new leases with those big tenants we talked about. In terms of the vault, as we say in the sector, it is a very good improvement of the length of the leases in Woluwe Shopping. It also is, of course, a little bit what happened to the valuation of Woluwe for the Parcours Store because, yeah, the value you see brand new leases for the long term, which obviously helps your cash flow model, etc.
Okay. Thank you very much.
The next question comes from the line of Francesca Ferragina calling from ING. Please go ahead.
Hello. Good morning, everybody. Many thanks for taking my questions. I have three. Do you prefer me to go one by one?
Hi, Francesca. If you can do the three together, then we will answer them like we did for now. Yeah.
Okay. The first one is about Italy. I see a very, very strong organic performance, especially strong when it comes to renegotiation and rental uplift. Can you elaborate a little bit on these? And what do you expect for, let's say, the first half of 2025? If I'm not wrong, the organic performance of Carosello was not included, and I don't see it explicitly mentioned. Can you give us a sense about the trends in rents that you see there since the re-merchandising plan is now completed? The second question is about investments. Can you elaborate a bit on the investments that you expect for 2025 when it comes to refurbishment, enlargement, things you are planning for 2025? Can you help us to quantify? The third one is about external growth. I escalate a bit the question of Valerie. In the past, you mentioned to be open to JV. Is this something, for example, you are still keen to? About disposal, would you be open to disposal eventually to make room for some new investment opportunity? When I talk about disposal, I'm referring to certain non-prime assets that you still have. That's it. Many thanks.
Thank you, Francesca. I did not pick up the last words of the third question.
That was about open to disposals.
Yeah, yeah. She referred to something specific, Francesca, about the disposal.
I was thinking maybe non-prime assets that you still have in.
Non-prime. Oh, okay. I picked up Primark, which, of course, is an important brand to us. Okay. Non-prime. Thank you so much. Roberto will start because he is the expert, of course, to talk about Italy, Carosello. Again, I think we would have loved to talk more, actually, about Italy today because there is a lot cooking. We could not because, of course, we are always in partnership with the retailers who are involved in this case. Of course, we need to always check whether everybody is comfortable with certain information being published. That came just a bit disgracefully too early, but we do hope to say a bit more in the Q1. Roberto, please take the floor on it.
No, I mean, you're absolutely right, Francesca. I mean, there is an organic strong performance of the Italian market, and we see that in all shopping centers. That's interesting to see that there is, when we do the renegotiations, an important component in all our shopping centers. If we look at the rental uplifts that we have, let's say, what are the expectations for the future? Let's say the expectations are free to grow. Evert Jan van Garderen mentioned it, gave a hint on three big projects that we are finalizing in Italy on Colles trada, on I Gigli, and on CremonaPo. We expect also a very strong contribution.
I mean, what we are doing is really setting these assets ready for the future. Really long-term investments, not only on our side, but also on our retailers' side, that they are making a lot of investment in the assets. You asked about Carosello. Does Carosello give an indication? Yes. We haven't published yet. We have the relating that we've performed in this last year after the refurbishment, but the showing increase well above the 20%. That gives you an idea. That's not, of course, including the musical chairs that we did. After that, what you see are the effects on the renewals and relating with our tenants. It's really important to keep on doing these projects.
Yeah. Francesca, you asked about 2025 and capital expenditure investments. To quantify that, obviously, we have our budgets. I think it's fair to say that what we have done over the past years, that's probably a good example of what you will see us doing going forward, is that of the overall result which we achieve, and then I'm talking particularly the direct investment result, let's say 75% of that is now used for dividend. The remainder is allowing us to do all those capital expenditure projects, including, by the way, also ESG investments we're doing, which is important not only because we want to achieve the goals we set out, but also sometimes important in terms of timing because you don't want to miss subsidies or tax breaks or other economic incentives which we can pick up by doing a particular investment on a particular timing in order to qualify for that kind of incentive.
Bearing that in mind, I think you would probably not be surprised if going forward we do a sort of similar overall CapEx expenditure, which is a maximum, I would say, 25% of the direct investment result. The other 75% being available for dividends. That is the sort of ballpark figure I can give for now.
Yeah. Also, as you correctly pointed out, Francesca, I mean, those investments also in ESG, they are allowing us to reduce service charges, which is also important for the growth, the rental income growth in the shopping centers. That is we, yeah.
Yeah. The last one, Francesca, are we open for joint ventures? We have been saying that for some time, and that has not changed. I mean, we are still enjoying two nice joint ventures today with AXA and FINIPER in Italy. We're used to doing so with institutional investors, us running the show, doing the asset management, but with a long-term partner. I think that concept would work also for maybe one or more of the other flagships we have, which could be then further in Italy or, we have now Woluwe in a very nice shape. Maybe we don't want to do a JV immediately on Woluwe because we probably would like to enjoy a bit of all the hard work done there and further uplifts we expect. Again, these are big assets. Woluwe is actually, we don't disclose individual asset values, but it is a fairly large asset. There is now one larger asset in our portfolio. These are, of course, ideal for joint ventures. We would still be interested to do so, and it's on our list.
Yeah. As you know, you asked about disposal or non-prime assets. Let's say we have a business plan for each of our shopping centers, but we actually look at the present and the future of these assets. For those assets where we believe we can no longer strongly contribute to the growth, then those assets for us are assets where we could do some capital recycling in favor of other investments where there is more potential growth. Have we answered your question, Francesca?
Yeah. Many thanks, Roberto. Everything is very clear. Thank you.
Thank you.
The next question comes from the line of Steven Boumans calling from ABN AMRO - ODDO. Please go ahead.
Hi. Good morning. Thank you for taking my questions. Two questions. First, if I look at retail sales and food sale numbers, it seems that Italy and Belgium are outperforming Sweden and France. What's the key drive here? Is it the re-merchandising projects? Is it the geographic footprint, quality of the assets, or given maybe that destination centers are outperforming the regional centers in general? How should we look at that forward and 2025? The second question is on the occupancy cost ratios. They have been trending upwards. I guess, especially for Italy, the OCR remains low. Hence the question, where could these OCRs land in, let's say, the next five years, especially for Italy? That's it for me.
Okay. Thank you, Steven, for your questions. Maybe I start with the food fall in particular, what you saw in Belgium. Particularly in the last quarter, which I could not resist not to talk about because it is amazing what is happening there. We have much higher visitor numbers and an increase in turnover. If I look at Woluwe, I can only say that is, I think, 99% the result of the re-merchandising project. I mean, if you now visit the mall, it is great. It has nice brands. We also upgraded, I think, in a way, the retail offer in Woluwe. It is very much appreciated. We know it is a wealthy catchment. It has attracted a lot more visitors than previously. I think it is certainly that result. Having said that, I think what also helped, that was maybe something where we were a bit lucky, but that Carrefour Market is there now replacing Match.
They are quite attractive to the catchment. We picked up that actually they're gaining market share actually as a brand. That's all good news for Woluwe. In general, whether destination centers do better than the smaller ones, we've seen, of course, some positive news from peers as well on reporting on the larger centers who were really popular, I think, also in the fourth quarter, also with the Christmas sales. Maybe there's a bit of effect as well, but it's for us difficult to actually measure that for Belgium.
OCRs, Steven, I think it is still, of course, for us important that we have attractive OCRs, and they are still at the lower end. It ticked up a little bit, but I think there is some effect from Sweden where they still had a high indexation over two years, almost 11%. Then on top of that, again, 6.8%. It is now down to 1.6%. Obviously, in two years' time, you could say 20% higher rental levels, which obviously will then increase OCRs unless your turnover really keeps pace, but that is not always immediately the case. A bit of effect there, particularly OCRs in Italy, Roberto.
Yeah. Steven was talking. Steven, thank you so much for your questions. Let's say we are, of course, taking out of the picture indexation wars and prices of raw materials. They, of course, have a strong impact on the service charges and therefore on the OCRs. What we do see, which is actually interesting, is higher conversion ratio. The people actually coming in our shopping centers tend to spend more than what they used to. That is due to several factors. One we hope we can be a little bit proud of is also the communication that we started to do with our clients in cooperation with our retailers, which is part of our digitalization effort.
What we are seeing is actually also a change in the catchment areas. Just to give an example without a different reference, but when you introduce Primark in one of the shopping centers, of course, your catchment area increases a lot. That, of course, is extremely good for the turnover of all the tenants within the shopping centers. That is the same if you introduce a large Inditex. Those are all things which are extremely important. You see an increase in the catchment area. You see an increase in the conversion power. Let's say those are the little bits that are in our hands.
If we just look at those little bits, then we are positive for concerns the increase in turnovers in the coming periods. That would have a positive effect on the OCR. That would mean that if we keep the OCR stable, we will be able to increase the rents. As you know, we are not here to squeeze in retailers on the country. We are here to work with them. We are not going to be too greedy. Of course, on the other hand, there are all the questions on consumer spending, interest rates, fear of war, and all those things. As we said before, keeping those outside, that is a bit of you. Does that answer your question, Steven?
Maybe a bit more specific. Let's say the OCR a bit below 10% seen today, it is unlikely that that will be 12% in three, four years.
I mean, taking out the exogenous, consumer spending, wars, interest, price of gas, and the rest, let's say we do believe that we are going to tick it up, but it's difficult for us to foresee that we're actually going to 12% or 13%. I mean, that would not be in our policy of operating with our retailers.
Clear. Thank you.
Thank you.
The next question comes from the line of Amal Aboulkhouatem calling from Degroof Peterc am. Please go ahead.
Good morning, gentlemen. Thank you for taking my questions. Actually, I have three questions. The first one, do you hear me?
Yeah, yeah. Perfect, Amal.
Yeah. Sorry. Yeah. The first one is about the retailer demand. You have been discussing, and we have been commenting a lot, the demand and the rental uplift in Italy. You also mentioned in your press release a word that triggered me. You mentioned the rental tension regarding the Italian markets. Can you quantify that? Especially with regard to the current context in Europe, how do you see the demand for new stores? For example, can you give us some color of any waiting list you would have on your portfolio? That would be my first question. The second one is about the risk of bankruptcies within your portfolio. I noticed that there is a slightly higher number of units under administration. It's a small increase in terms of units, but in terms of MDR, it's slightly more significant. Can you comment on that one? The last one is, again, on Woluwe . The question is, following the re-merchandising and the relating that you have done, do you still see any potential for negative reversion in the current, let's say, lease agreement and tenant base you have in Woluwe? That is it from me. Thank you.
Thank you, Amal. Italy is very popular this morning. I asked Roberto again to give some color on Italy and how many people are queuing up for our units and waiting lists, et cetera.
We paid a bit of that. We paid them. We paid them. Now, there is, as you said, a lot of retailers' demand. I mean, what we have seen is a big split between the centers performing well, where capital is invested, where things are kept in a nice and efficient way, where the retailer mix is actually the retail mix which is adapted to the catchment area. Those centers are performing well. The others, and there are quite a few, when there is very little investment, the tenancy is selected on the basis of how much can you actually pay. There is no real link between the offer within the shopping center and the catchment area. That is a bit more complicated. We got Ilaria here who is doing a fantastic job for concerns our consumers, the identification of the different groups. What we are trying to do is really to match the requests of our catchment area to the services and goods that we can provide. We listen to our customers quite often every year, but also directly now with our CRM program. What we do is we use their feedback to understand also what they suggest that we do as improvements in our shopping centers.
You have seen quite a change in the offer that we have for concerns our retailers, the services that we provide within the shopping centers. There, we have to say there is a list. We got some centers where actually the main difficulty that we have is size, is vacancy, because there is no vacancy. There is no extra space that we can rent. There, what you see is what we are trying to do is actually negotiate with some tenants which are performing less well so that they can leave the center before so that we can remodernize the space and rent it to somebody else. I mean, one example is in Carosello where we had to wait for Coin to reach an agreement with them to have them out of the shopping center so that we can use where they're able to use the space for MediaWorld and then move Zara in the space that MediaWorld and H&M then had left. This is something that we're doing for all the shopping centers. Of course, it takes time, negotiations, and sometimes you really have to wait for the end of the contract because otherwise there is no way that they're going to leave the shopping center. We do have a wishing list. We do have, let's say, a waiting list.
I do not like it to put it that way, but we do have a wishing list for the tenants that we would like to have, for the retailers that we would like to have in our shopping centers. I have to be honest, our leasing teams have actually been extremely active to try and find possible combinations whereby we could find a suitable. There is nothing like perfection, but a suitable space for some of these retailers. You may get a smaller space than you would actually want, but you got the space in Carosello. You got the space in Egid. You got the space in Fiordaliso. That is what we have been doing so far. There is rental tension. There is a wishing list. There are tenants who cannot wait actually to get in the shopping center, but we are being very selective. We will just go for those tenants which actually give a contribution to the improvement of the services and products that we offer to our catchment area. Does that answer your question, Amal?
Yes, very clear. Thank you very much, Roberto.
Yeah. Amal, your two other questions, tenants in administration and then the potential further in Woluwe . Tenants in administration indeed ticked up a little bit, but I think it is still happening in markets. I mean, I just take Casa, for example, in Belgium, which filed for bankruptcy with an effect in Belgium and the Netherlands. You cannot exclude these casualties. Again, it's not always bad news because in a number of cases, quite the majority, they still pay rent. Sometimes it's taken over by a better brand. You benefit from it. I think the Go Sport Intersport case was a very good example for us. It is not always bad news. Yeah, it is not something which we can say, "Oh, that is a worrying effect." It does happen in retail. I think there are still winners and losers. Overall, it should not affect us, also not for the near future. Tenants in administration, we are monitoring it, but we are not suffering from it.
Potential. Sometimes it is an opportunity.
That is an opportunity indeed. Woluwe again, is there further reversion potential? I think Woluwe is a very good example of a mall which has a history, of course, and we see in the deals, and they are very specific that with a certain unit, if it is a decent unit. The trouble is sometimes that still some of the units are rather deep and not have that much frontage, which is obviously the result of a mall being more than 50 years around. Therefore, some leftful space is easier than others. I think we still have the potential to, on the back of the success of the mall in general with the increase in footfall, do some good leasing deals. On the other hand, I'm not excluding cases where we definitely want to get a brand in that maybe we cannot achieve the current rent on this specific unit because some of these units are units with rather high rents per square meter, which goes well, sometimes well above EUR 1,200 or more per square meter. That is a case-by-case matter, I think, Amal.
I understand. Perhaps to put it differently, do you still have tenants where you think that they are paying rents above market rent levels?
Yeah. I think, let's say, there's always a unit where you could say, "This is maybe a rent which is too high." The other thing which we should not forget, if a tenant is paying maybe too much, but we also should relate it to the sector the tenant is in. If a tenant is probably maybe struggling with the rent level, if you change the sector, for example, you could end up with a situation where it is affordable because the tenant is doing a different business, higher margin business, for example, and therefore you can afford the rent. It is not always so black and white. We are trying really to do it in a tailor-made way.
Okay. Very clear. Thank you very much. This is very clear.
Thank you, Amal. Thank you.
The next question comes from the line of Kai Klose, calling from Berenberg. Please go ahead.
Yes, good morning. I've got two questions on the financials and one on France. The first one is on the current taxes in the direct result statement. I saw the footnote which described or explains the reduction year- on-y ear. Just want to understand if this effect for 2024 will also be repeated in 2025, so if the cash taxes or the cash tax rate is likely to remain as low as it was in 2024. The second question is on the shift in property expenses and company expenses. Could you maybe indicate adjusted by the shifts, what was the normalized or, yeah, the adjusted increase year- on- year? The third and last question would be on the renewals in France where you explained the slight rent decrease. Is it fair to assume that some of the there's a similar effect we could see in 2025? Thank you. Yeah. That is one that you mentioned in France, right?
Yeah, that is the renewals in France where because there we had a minus, a little minus, and whether that's something we could expect for 2025. Maybe I take the last question first, Kai, and then I leave Roberto with the other two questions, although I can imagine that maybe on the property expenses, because that's quite technical, that we sort of get in touch with Kai to show how this normalized position is then. In order not to lose you entirely in the call in terms of a lot of numbers.
Renewals in France, no, let's say that it was particularly linked to the Poulinbert lease in Passage du Havre, which we also already reported in the summer. As you know, with renewals relating, these are figures which concern a 12-month period. We, of course, roll it forward. Every quarter, you lose the oldest quarter and you get a new one. If there is a deal, a negative deal in there, you will see it for some time being published. Going forward, I think in France, France is probably one of the markets where it is a bit tougher in terms of the leasing. I think there's still some upside here and there, but I wouldn't compare it to Italy. Going forward, I think on renewals and relating, I would be less optimistic. I think still a little plus, but less optimistic like what is happening in Italy and in some individual cases actually in Belgium.
Yeah. I'll take the financial ones. For concerns, the current taxes, it is a one-off that we had in Sweden. That is considered the previous levels at the standard levels that we have. For concerns, the company expenses and property expenses, I'll just tell you shortly what we did. Of course, we can sit together more in detail to go more in detail on the single items. Mainly, let's say we had the reclassification of the property tax in Italy, which we had in the property expenses, we reclassified to the service charges. There's a reason for that. That's because all property taxes are in the service charges for all countries.
In Italy, they were not because the legislation before did not allow for property taxes to be recharged to tenants. That has now changed. Property tax can be recharged to tenants, and that is also what we are doing. It was more accurate to report in the service charges where it belongs. IT costs, that is part of our digitalization. What we did before, we just had general IT costs, which were related to the maintenance of servers, connections, the computers, and all the user stuff. What we do have now is that real input for concerns, the digitalization in our shopping centers. You can, and it is really an investment which is done in each of the shopping centers.
You can look at it as CRM, for example. You can look at it as digitalization efforts like digitalization screens and the management of them and everything. We thought it was more appropriate to have it where it belongs, which is the property where we are investing it so that we also get in some results. We talked about the conversion ratio, for example. That is the increase in the conversion ratio. That is also part of the effort that we were doing. You are disposable when you want to go through more in details in all of them. Really, with pleasure.
Great. Thanks so much indeed. Thank you. Ladies and gentlemen, as a final reminder, if you would like to ask a question, please press star one now. As we currently have no question in the queue, we are going now to take some questions in the meantime from the webcast. Floor is yours.
Yeah. Thank you, operator. We had a look at the webcast, and there are three questions coming from Benjamin Legrand. The first one is, why is Belgium like-for-like rental growth lower compared to the rest while vacancy is down and rental uplift was higher than average? I think we probably touched upon this with the discussion we had earlier on the rental growth and the Inno department store and lease incentives. Like-for-like rental growth is always concerning the entire portfolio. In this case, it's the total rent in Woluwe Shopping, whereas rental uplift is only talking about those deals where you have effectively done them in the 12-month period. That can be only a proportion of the total which you use for rental growth. Therefore, rental uplift and rental growth is not necessarily always going hand in hand.
The vacancy is down, yeah, because, let's say, doing all this nice re-merchandising, we attracted a lot more additional tenants, bringing us to a very low vacancy in Woluwe Shopping. The next question is, do you see continued positive acceleration reversion on relating to renewals in your portfolio going forward? I think we touched upon what we expect in the next months in the coming period on renewals relating. If I would have to give an overall ballpark figure, I think we should, as always, be cautious. I think there is still reversion. If you can add maybe a 2% overall for the portfolio, do not forget indexation is still there as well. That would be something which we could expect. The last one, do you intend any additional share buyback for 2025 to offset dilution from script dividend?
Again, we talked about capital allocation. Last year, we announced the buyback when we also announced the script issue price for the stock dividend that was in June just before our annual general meeting. That is probably the moment if we want to do it again to announce it. It also depends on what we see in the market. If there is an opportunity where we say the capital raised with the stock dividend, we will use together maybe with some leverage to acquire something where we have an accretive deal on the table, that could be maybe preferred over considering buyback. For now, it's a bit too early to tell. We'll let you know when we're there. I think that those are the questions in the webcast. Operator, any other investors or participants who would like to ask questions?
Yeah. We have another one, the last one from Lynn Hautekeete, sorry for the pronunciation, from KBC Securities. Please go ahead.
Good morning, everyone. Yeah, just the last one, a quick one from my side. I was just wondering why the investment expenses doubled in 2024 and what do you see in 2025 regarding that item? Thanks.
Yeah. Thank you, Lynn. Thank you for your question. I think, Roberto, you would like to comment on that.
Yeah, absolutely, Lynn. We have an increase in investment expenses this year. If you look at it, a lot of it is IFRS 2, and that's with the share performance plan. Then what you also have is part of the bonus, which is linked to the indirect result, is also there increasing. We got the valuation fees, which are always there. One important contribution was also for aborted acquisition costs. We looked at some items, as you know, but they didn't go through. That is the entire composition of the investment expenses. Looking forward, we think it will possibly stay or be reduced next year. It really depends on what is going to happen. Does that ans wer your question, Lynn?
Yeah. Investment expenses are always a bit volatile because they do include some one-offs. We will be also in our annual report very transparent about what the composition is. Roberto just gave you the description. That is something which we report separately because we clearly have a distinction between the direct investment result and the indirect investment result, which is probably a typical Dutch way of looking at a P&L. For us, it is also important to follow those Dutch particular rules. Okay, Lynn, does it answer your question?
Yes, it does. Thank you.
Okay. Thank you. Ladies and gentlemen, we currently have no questions. I will hand it back to your host to conclude this conference. Thank you.
Thank you so much, everybody who participated and who asked us questions. I hope it gave a lot of insight, and we experienced a nice conversation today. Let's stay in touch. Thank you for now. Wishing you a pleasant day. Thank you.
Thank you very much. Thank you for joining today's call. You may now disconnect.