Park Street A/S – Interim Financial Report, 1st half of 2023 - Seite 2

Park Street’s EBVAT expectations are refined to a lower range of DKK 45 to DKK 50 million compared to an earlier guidance of DKK 55 million. The change is in view of the lower number of assets, due to sales, and a longer lead time for the new leases to be operational in view of significant refurbishment works for the new leases.

Park Street is making good progress with Pulse Nørrebro project which is expected to be operational by the summer of 2023 and is also taking steps towards initiating Pulse Tåstrup project later this year.

Management comments on the Interim report

In connection with the interim report for H1 2023, CEO Pradeep Pattem states the following:

“Park Street has made positive progress withs signing of 36 new leases worth over DKK 5.5 million for 4,700 sqm. Some of these leases require capex and refurbishment works which are expected to be completed during H2 2023 and will start generating top line cash flow during the year. We have also made some progress with the strategy of reducing assets in the geographies and sector not core to Park Street with the appointment of an external asset manager for these assets. While the sale of asset in the short term will reduce the top and bottom line of company, our focus of investing in core asset to reduce vacancies and improve the properties should in the medium term generate significantly improved quality of revenues and profitability. Park Street will continue to sell asset which are not core to its long term strategy, while investing in the core portfolio, primarily Pulse Living (our Youth Housing Platform) and Spark Offices (Our Managed Office Space Platform) in key cities with sustainable growth potential.

The range of EBVAT expectation is refined to a lower range of DKK 45 to DKK 50 million compared to an earlier guidance of DKK 55 million. The change is in view of the lower number of assets, due to sales, and a longer lead time for the new leases to be operational in view of significant refurbishment work for the new assets.

Park Street is expecting to launch Pulse Nørrebro in Q3, and expect it to be fully leased within the quarter. This is a flagship asset to further develop and scale the Pulse platform.

We are facing an extraordinary market environment, with significant increase in interest rates, high inflation and yet high demand for housing and office space, particularly in Denmark / Copenhagen. The investment market is far more uncertain in terms of the valuations – leading to a relatively slow market for sales and acquisitions. We have prepared the balance sheet and operating platform, which is intensively tech driven with lower cost base, in anticipation of a tougher operating market in the medium term. Further investing in our selective portfolio and developing the Pulse platform remain our focus.”