Report of the Supervisory Committee

Chairman's Statement

Before I start the review of 2019, I would like to address the outbreak of the coronavirus (COVID-19), starting late 2019 in China and today still spreading around the world. To contain the virus and to prevent further spreading, governments across the globe are taking extreme but unavoidable measures and, in this line, Vesteda has also taken measures regarding the operational activities of the company. It is clear that the impact on the Global and Dutch economy will be severe, but at this point (18 March 2020) it is too early to determine the exact impact for Vesteda. The Management Board and the Supervisory Committee will closely monitor the development of this crisis and take additional measures if needed, prioritising the health and safety of the tenants and employees.

The year 2019 started with the fund’s first liquidity review date, a moment meant for the participants to review the future strategy and objectives of the Fund and to decide if they would like to redeem all or a portion of their participation rights. The Supervisory Committee was pleased that no participant chose to redeem participation rights during the liquidity review period, which is a testament of their trust in Vesteda. During the year, several participation rights transactions took place, both between existing participants as with new participants. Vesteda welcomed three new participants to the fund last year.

As part of its ongoing portfolio management, Vesteda continuously assesses its portfolio and identifies assets that are deemed to no longer fit Vesteda’s overall portfolio. As part of this, Vesteda sold two portfolios comprised of “non-core” assets. By divesting these portfolios and investing in new attractive projects with growth potential, Vesteda was able to improve the composition of its portfolio. Furthermore, the acquisitions team worked hard on expanding Vesteda’s pipeline. The Dutch housing market and the mid-rental market in particular are facing serious challenges in this respect. Nevertheless, Vesteda managed to acquire several interesting projects, some of which, such as The Ox in Amsterdam and Willemsbuiten in Tilburg, were approved by the Supervisory Committee due to the transaction size. In addition to acquiring new projects, Vesteda also invested in its existing portfolio. In this respect, the Supervisory Committee approved a renovation and sustainability project in Rijswijk.

Vesteda’s commitment to its sustainability goals was underpinned by Vesteda achieving five stars in the GRESB benchmark. In doing so, Vesteda is part of the top 20% of most sustainable funds worldwide. In addition, Vesteda obtained its first WELL certificate for project “Aan de Rijn” in Arnhem, making it the first building worldwide that has been certified whilst inhabited. These are great results and the Supervisory Committee is looking forward to further sustainability achievements in the years to come.

Many employees of Vesteda were involved in the preparations of the implementation of the new ERP system. The Supervisory Committee monitored the developments in the project and the impact on the organisation throughout the year. Unfortunately, despite the hard work of all involved, management decided to postpone the go-live date as the system did not yet fulfil the requirements to guarantee a successful implementation. This was a hard decision and has required resilience from the Vesteda employees.

Vesteda’s aim is to have a robust and well-diversified, flexible funding structure. Vesteda took important steps in 2019 towards this goal. Vesteda extended its revolving credit facility, pre-hedged its interest rate risk and issued a euro commercial paper. The notable highlight this year on funding level was the issuance of a €500 million Euro green bond. Vesteda was the first residential real estate investor to issue a green bond and will use the proceeds to make its homes more sustainable, for the financing of its acquisition pipeline, as well as refinancing its funding.

At Supervisory Committee level, the participants unanimously appointed two new members, Mr. Eysink and Mrs. Klein Schiphorst. The Supervisory Committee is of the opinion that they will make a meaningful contribution to the Supervisory Committee. Mrs. Van den Herik and Mr. Copier were re-appointed for a period of four years. With these appointments, the Supervisory Committee is at full strength at present.

I would like to conclude by thanking John de Die and Peter Kok, former members of the Supervisory Committee, for their eight years of service to Vesteda. Furthermore, I am grateful to my fellow Supervisory Committee members for their hard work and dedication in 2019. On behalf of us all, I would also like to thank the company's Management Board, Management Team and all other Vesteda employees for making 2019 another successful year to remember.

Jaap Blokhuis, Chairman of the Supervisory Committee

Supervisory Committee

Focal Points

The main task of the Supervisory Committee is to supervise the management carried out by the manager and the general course of the fund's business, as described in more detail in the Corporate governance and Risk management sections of this report.

In exercising its duties in 2019, the Supervisory Committee and its separate committees placed particular emphasis on the following topics:

  • The liquidity review date

  • The sale of two portfolios

  • The funding and issuance of a Green Bond

  • The implementation of a new ERP system

The abovementioned topics will be set out below in more detail, together with additional matters addressed by the Supervisory Committee during the course of the year.

Meetings and Attendance Record

The Supervisory Committee comprises Mr. Blokhuis (Chairman), Mr. Copier, Mrs. Van den Herik, Mr. Eysink and Mrs. Klein Schiphorst, all of whom are deemed independent in the sense described in the Supervisory Committee's by-laws.

In 2019, the Supervisory Committee met 12 times, 8 times in person and 4 times via conference call. The Management Board and (members of) the Management Team attended most of these meetings. The Supervisory Committee met 1 time in the absence of the Management Board, among other things to discuss the recruitment process of the new members of the Supervisory Committee. In addition, the Supervisory Committee met in the absence of the Management Board ahead of regular scheduled meetings and with the Works Council.

Below you will find an overview of the attendance record per member of the Supervisory Committee[1]:

Overview of attendance record Supervisory Committee

Supervisory Committee

Audit Committee

Nomination & Remuneration Committee

Jaap Blokhuis




Hans Copier




Seada van den Herik




Theo Eysink (start of tenure 1 May)




Eva Klein Schiphorst (start of tenure 17 October)




John de Die (end of tenure 1 April)




Peter Kok (end of tenure 1 July)




  • 1 Attendance is expressed as the number of meetings (including conference calls) attended out of the number of meetings the members were eligible to attend. For the non-attended meetings power of attorneys were provided.

The activities of the Supervisory Committee and its separate committees in 2019 are summarised in the following schedule:

Supervisory Committee activities 2019 (including committees)








Appointment new Supervisory Committee member

Amendment Terms & Conditions

Amendment Terms & Conditions

Amendment Terms & Conditions

Compliance, Risk and Internal Audit

Compliance, Risk and Internal Audit

Audit plan external auditor

Business plan 2020-2024

ERP project

Composition of committees

Compliance, Risk and Internal Audit

Compliance, Risk and Internal Audit

Extension RCF & pre-hedge interest rate swap

ERP project

ERP project

ERP project

Financial statements, annual report and allocation of net income 2018

Evaluation of acquisition Delta Lloyd portfolio

Evaluation and re-appointment auditor

Evaluation project Leidsche Rijn Centrum

Impact IFRS 16

Green Bond


Investment proposals

Investment proposal

Impact IFRS 16

Q2 2019 report


Liquidity review process

Information security policy

Sale of two portfolios

New job evaluation method Korn Ferry

Merger Custodian entities

Investment proposals

Succession planning

Q3 2019 report

Operational Due Diligence participant

Q1 2019 report


Re-appointment Supervisory Committee members

Q4 2018 report

Sale of two portfolios


Selection and appointment new Supervisory Committee member

Report external auditor 2018

Selection and appointment new Supervisory Committee member


Sale of two portfolios

Selection new Supervisory Committee member


Targets and bonus Management Board and Management Team

SMBC facility


You will find additional information on the role and functioning of the Supervisory Committee and its committees in the Corporate Governance section of this report.

The liquidity review date

The first quarter of 2019 started with the fund’s first liquidity review date. Ahead of the liquidity review date, management had various discussions with participants on this topic. The liquidity review date triggers the mechanism by which participants are given the opportunity to reevaluate their respective participations in the fund and to indicate if and to what extent they would like to redeem all or a portion of their participation rights or increase the number of their participation rights. Based on the conversation with participants, management assessed that it would be likely no participant would submit a redemption request in accordance with the liquidity review process.

During the liquidity period, the fund is not allowed to, amongst others, make new investments or deleverage until the participation rights have been redeemed. As this could hamper Vesteda’s ongoing investment activities at the time, the manager, in deliberation with the Supervisory Committee, proposed to the participants to shorten the liquidity review period. During the extraordinary meeting in January, the participants all voted in favor of this proposal. As a result, the liquidity review process was completed in February 2019. The Supervisory Committee closely followed all developments during the liquidity review process and was pleased with the result. The participants’ unanimous support for this proposal was a great success for management and the result of excellent preparation.

The sale of two portfolios

At the end of 2018, Vesteda informed its participants that it was planning to sell a substantial portfolio of non-core assets in order to improve the quality of the overall portfolio, while using current market momentum. The Supervisory Committee was presented with a divestment proposal and discussed the composition of the portfolio and the rationale for the transaction. With the support of the Supervisory Committee, management decided to split the portfolio in two portfolios, a large portfolio comprising of complexes and a small portfolio comprising of scattered property, in order to optimize the match between the composition of each portfolio and the target buyer groups.

Both sales required the approval of the Supervisory Committee and the sale of the large portfolio required participants’ approval too. Prior to the extraordinary general meeting of participants, a number of participants asked questions regarding the transaction and the distribution of proceeds. These questions were discussed with management and the Chairman of the Supervisory Committee and the answers to the questions were sent to all the participants via a Q&A document. The participants gave their unanimous support for the proposed divestment.

Funding and issuance of a Green Bond

In the Audit Committee of November 2018, the hedging strategies towards refinancing the €300 million bond that matured in July 2019 were discussed. It was, in consultation with the Audit Committee, concluded that it was not the right time to enter into a hedge agreement. It was agreed that the treasury department would monitor the development of interest rates. In the beginning of 2019, the developments in the financial markets provided an opportunity due to a steep decline of the mid-swap rate.

In consultation with the Audit Committee it was decided that it was the right time to refinance the maturing bond with a €500 million Green Bond. After positive recommendations from the Audit Committee, the Supervisory Committee approved the issuance of the Green Bond. Vesteda managed to successfully issue its inaugural green bond. This is the second benchmark size bond under Vesteda’s €2.5 billion EMTN programme and the first EUR green bond by a residential fund. The €500 million bond has a term of 8 years and a coupon of 1.5%. The bond was more than 6 times oversubscribed, evidencing the financial markets’ trust in Vesteda’s proposition.

Implementation of a new ERP system

In 2017, the Supervisory Committee approved the investment in a new ERP system. This ERP system is aimed at optimising and aligning internal processes, resulting in more efficient asset management and reporting. In our 2018 report, we indicated that the go-live phase would be due later in 2019. In 2019, the Vesteda organisation dedicated considerable time and attention to the preparations for this implementation. Throughout the year, the Audit Committee closely monitored the preparations for the implementation of the new ERP system. One of the Supervisory Committee members had a half day on site review on the ERP project, systems, team and progress. By performing test rounds of the new ERP system, management concluded that there were too many instabilities in the system to ensure a smooth go-live. The Supervisory Committee understands the considerations of management in this respect and has emphasized the importance of a controlled implementation process.

Finance and reporting

In early 2019, the Supervisory Committee discussed the preliminary results for 2018 and audit matters with Deloitte. The auditor indicated that a number of topics had been added to the audit report, such as a further explanation of the materiality thresholds and the use of data analytics. The 2018 financial statements and the 2018 annual report were discussed in the presence of Vesteda’s auditor who indicated that the audit process with Vesteda went well. The impact of the implementation of IFRS 16 was discussed extensively with both the Audit Committee and the Supervisory Committee.

The Supervisory Committee discussed the fund’s performance versus the budget on a quarterly basis. The overall trend was outperformance on most line items compared to 2018 and the budget. The interest expenses overall were lower than budgeted due to the successful execution of a commercial paper programme and the green bond. The development of the management expenses reflected the additional costs related to the postponement of the go-live of the ERP system. The possibilities to switch to perpetual leasehold in Amsterdam was a recurring subject during the Supervisory Committee meetings and the Audit Committee meetings.


With the departure of the Supervisory Committee members Mr. de Die and Mr. Kok, the Supervisory Committee, with the help of an executive search agency, selected suitable candidates. In the selection process the Supervisory Committee focussed on both quality of the candidates and the diversity and overall composition of the team. As a result, the Supervisory Committee submitted a proposal to the participants to appoint Mr. Eysink and Mrs. Klein Schiphorst as new members. The participants voted unanimously in favour of the respective appointments; Mr. Eysink and Mrs. Klein Schiphorst were appointed as member of the Supervisory Committee, respectively in May and October 2019. Pursuant to these appointments, the Supervisory Committee amended the composition of its committees.

As part of their introduction, Mr. Eysink and Mrs. Klein Schiphorst were provided with background information on Vesteda, its structure, operations and terms, and followed an introduction programme, which included meetings with executives and other staff members to learn about Vesteda and its specifics. Mr. Eysink and Mrs. Klein Schiphorst were also invited to visit the Vesteda office in Amersfoort. There they had a viewing at the complex ‘Zicht op Amersfoort’ and a guided tour at sustainability project Schuilenburg in Amersfoort.

One of the Supervisory Committee’s recurring tasks is determining the bonuses of the Management Board and the Management Team and setting targets for the year ahead. In terms of the 2018 bonuses, the Supervisory Committee focused on ensuring a balanced remuneration for all relevant positions eligible for the bonus schemes. With regards to the targets of 2019, the Supervisory Committee decided to maintain the structure of 2018 for 2019, which links strongly to Vesteda’s broad set of KPIs as set out in the Business Plan and gives the Supervisory Committee more discretion in assessing qualitative targets.

In light of Vesteda’s goal to become a High Performance Organisation, Vesteda’s management initiated in 2019 a management development programme. The aim of this programme is to increase collaboration between managers and teams and help create a culture in which Vesteda’s employees embody their core values and learn how to achieve their own team’s full potential. This programme was completed in November 2019.

In light of its ‘permanent education’, the Supervisory Committee met off-site with the Management Team, focusing on project development, climate change, disruption and PropTech.

Given the material changes in the composition of the Supervisory Committee, it was decided to not execute a self-assessment in the year under review. Instead, the committee had a work-session on the individual members’ personalities, professional drives and their way of cooperation in the committees aiming at a smooth onboarding of the new Supervisory Committee members.


The members of the Supervisory Committee held meetings in absence of management, including meetings with the internal auditor and the external auditor. On various occasions, individual members of the Supervisory Committee met with senior officers of Vesteda to gain information on current matters.

The Supervisory Committee approved several investment proposals, such as The Ox in Amsterdam, Westerwal in Groningen and Frank is een Binck in The Hague, and discussed a number of proposed investments in the pre-approval phase. In light of these proposals, the Supervisory Committee discussed the impact of rental regulations on investment propositions and the expected IRR of such investments. This discussion also took place with the fund’s participants. In addition, the Supervisory Committee looked closely at how sustainability investments are incorporated in the financial models.

The Supervisory Committee periodically discussed matters related to the fund’s investor relations. In view of this, the Supervisory Committee joined the informal Annual Participants’ Day, which was attended by a large number of representatives of the fund’s participants.

Vesteda participated in an extensive Operational Due Diligence at the request of two participants. The Internal Auditor shared the outcome of the report with the Audit Committee and the Supervisory Committee. This report highlighted that the participants consider the checks and balances at Vesteda to be very important. The report also included some recommendations, which the Management Team took in consideration. The Supervisory Committee will continue to closely monitor this aspect of the fund.

The Supervisory Committee took note of Vesteda’s press coverage throughout the year, in relation to the ongoing discussion of the Dutch mid-rental market, as well as maintenance issues in the portfolio, and was informed by management of actions taken.

Overall, the Supervisory Committee and the Management Board worked well together in 2019. Information was provided in a timely fashion and was clear and sufficient enough for the Supervisory Committee to perform its duties. The Supervisory Committee had no reason for audits or investigations.

Audit Committee

The Audit Committee consists of Mr. Eysink (Chairman) and Mr. Copier. Mr. Blokhuis was part of the committee until November 2019. The Committee met seven times in the year under review.

The Audit Committee discussed in detail the periodic statements and the 2018 annual financial statements and annual report in the presence of the CEO, CFO and external auditor. The Audit Committee discussed the audit process, preliminary and key audit findings and principal assumptions, judgments and valuations, and the external auditor reported its preliminary and final audit findings. Overall, the audit process went well and no material findings were reported. As part of the yearly audit process, the auditor presented the Audit Committee with its findings in light of the ISAE 3402 audit. Whilst there were some points of attention mentioned, the Audit Committee was pleased to learn that the auditor issued an unqualified statement in this respect.

The Audit Committee conducted extensive discussions on Vesteda’s debt funding strategy, as set out in more detail in the Funding section of this report.

In addition, the Audit Committee discussed several funding subjects, such as:

  • The extension of the Revolving Credit Facility;

  • Pre-hedge interest rate swap;

  • Green Bond: €500 million Euro Green Bond;

  • Uncommitted SMBC facility.

The Audit Committee provided the Supervisory Committee with positive recommendations on all these projects.

The Audit Committee reviewed the fund’s financial report on a quarterly basis. In doing so, the Audit Committee asked management to give full insight in the financials including and excluding the Delta Lloyd portfolio, which was acquired in 2018, in order to be able to monitor the development of Vesteda’s day-to-day business.

The Audit Committee assessed the external auditor, Deloitte, and provided the Supervisory Committee with a positive recommendation to re-appoint Deloitte as auditor. The conclusions of the assessment were shared with the lead partner of Deloitte. Furthermore, the Audit Committee approved Deloitte’s Audit Plan 2019, in which the implementation of the new ERP system was qualified as a substantial risk. The other focus areas are data migration, the implementation of IFRS 16, project The Ox and the sale of two portfolio’s. Deloitte also announced a fraud awareness-course for the department Finance & Control, which took place in November. The Chairman of the Audit Committee met and spoke with the External Auditor on several occasions in the absence of the Management Board, in order to remain directly informed.

Management presented Vesteda’s valuation cycle to the Audit Committee and a proposal to amend that cycle. The Audit Committee verified that the reasons for changing the valuation cycle were to optimize the process; the new scheme allows new appraisers to start with appraising a smaller part of the portfolio, which enhances quality. The Audit Committee also verified that the change would not impact the valuations or the valuation method.

The Audit Committee spent considerable time and attention to the ERP implementation project. On several occasions the scope and progress of the project was discussed. The subsequent postponement and financial impact were adequately addressed.

The CFO reported on a quarterly basis on risk management and the activities of the Risk Committee, particularly the assessment of IT security risk; as a result, Vesteda developed a new information security policy which was discussed with the Audit Committee. The Audit Committee was informed of the outcome of the annual update of the strategic risk assessment. Privacy is a recurring item on the Risk Committee agenda. The information security policy was finalised and adopted in the year under review, under supervision of the CFO, the Internal Auditor and the Digital & Innovation Manager.

The Audit Committee took note of various material internal audit investigations that took place during 2019, such as the quality assurance insourcing of the Delta Lloyd portfolio and the quality assurance of the service and heating costs. In executing its investigations the Internal Audit department also looked into behavioural components which can adversely affect the execution of control measures. The Audit Committee reviewed the conclusions and discussed follow-up actions with the Internal Auditor and management.

Nomination and Remuneration Committee

The Nomination and Remuneration Committee (“NR Committee”) consists of Mrs. Van den Herik and Mrs. Klein Schiphorst. Mr. Copier was part of the committee until November 2019. The Committee met four times in the year under review.

At the beginning of the year, the NR Committee was engaged in the evaluation of Management’s targets for 2018. It also worked closely with management to set the targets for the Management Board and Management Team for 2019, in line with the target structure that was set up in 2018. The achievement of the targets for 2019 was monitored throughout the year.

The CEO and HR manager periodically updated the NR Committee on their meetings with the Works Council and the NR Committee also met with de Works Council in person. For example about subjects as the formation positions in the newly opened Vesteda office in Heerhugowaard last year. HR discussed with both the NR Committee and the Works Council the proposal to introduce a new job evaluation method, as the current used method will no longer be supported. This new job evaluation method will be implemented in 2020 under the supervision of the NR Committee. 

In every meeting the NR committee was presented with a compliance update, focusing on reported integrity incidents and follow up and compliance with regulatory requirements. In this respect, the NR Committee appreciates the fact that management reports openly about matters at hand.

At the request of the NR Committee, there was considerable attention for succession planning and for talent management during the NR Committee meetings. In the light of becoming a High Performance Organisation (HPO), the need to involve the company’s managers more in getting to the next level was discussed. Management set up a development programme in 2019, which was attended by approximately 30 managers. During this programme, managers discussed various subjects and worked together on a vision for the new Business Plan.

Furthermore, the NR Committee was presented with a report from an external consultancy firm to provide a benchmark for the remuneration of management and senior staff. It concluded that the remuneration of almost all positions was in line with the Vesteda remuneration policy and with the benchmark, as was the case in 2018.

Meeting of Participants

Vesteda convened two regular Participants’ Meetings in the year under review. These included the annual meeting in April, in which the financial statements and the annual report were discussed and adopted, and the execution of the Business Plan was evaluated. In the bi-annual meeting in December, the participants discussed and approved the Business Plan 2020. Furthermore, Vesteda convened four extraordinary Participants’ Meetings. During these meetings the participants were asked for approval for several subjects, such as the previously outlined liquidity review date, the sale of a portfolio and (re-)appointments of members of the Supervisory Committee.

In addition, participants attended the annual informal Participants’ Day in September, during which they were both informed of the company’s plans and invited to provide input on several topics, such as the amendment of the fund’s Terms and Conditions, affordability and regulation of the mid-rental market and the potential impact of climate change on Vesteda’s portfolio.

Amsterdam, 18 March 2020

Supervisory Committee

Jaap Blokhuis, Chairman
Hans Copier
Seada van den Herik
Theo Eysink
Eva Klein Schiphorst