Strategy and long-term objectives

Vesteda has defined a clear vision framework, consisting of a purpose, mission, vision and core values.

Our purpose

Vesteda invests the pension savings and insurance premiums entrusted to it by institutional investors, such as pension funds and insurance companies, in sustainable Dutch residential real estate for middle-income tenants. As such, we contribute to future income security for retirees, affordable living for Dutch middle-income households and to the continued improvement of the quality of urban communities.

Our mission

At home with Vesteda. This applies to our tenants, the investors who invest in our fund and the employees who work at our company. Our mission is to make sure our key stakeholders feel at home with Vesteda. And we want to be the best landlord in the Netherlands by outperforming on tenant satisfactions, sustainability and financial performance.

Our vision

Vesteda is the expert in residential living. We have direct contact with our tenants. This is why we know their current and future living requirements better than anyone. We use our knowledge to constantly improve our services and our existing residential portfolio. We also add residential complexes that are tailored to the living requirements of our tenants now and in the future and we do so in a sustainable and innovative manner. Together with our tenants, we create an environment in which they feel at home.

Our core values

At Vesteda, our tenants, investors and employees are our highest priority. This requires service-oriented and entrepreneurial employees. We listen and learn and look for the best solutions. We see and seize opportunities and accept our responsibility. Vesteda is ambitious. We make the most of everything. And do better every time and with total conviction. We trust our people and give them a great deal of freedom and responsibility. We cooperate with each other across various disciplines and come from a wide variety of backgrounds.

Our strategic ambitions

Vesteda has translated its mission and vision into strategic and portfolio objectives.

Vesteda vision framework

Based on our vision framework and developments in society and the housing market, we have formulated our strategic ambitions for the coming years. Our strategic ambitions include:

Tenants: “Provide high-quality and convenient housing to mid-rental segment tenants in urbanised areas at affordable prices”

Our tenants’ satisfaction is a valuable indicator of how well we serve them. Our tenant satisfaction score is improving steadily. The improvement in this score in recent years underlines the importance of in-house property management as part of our business model. We will continue to focus on improving tenant satisfaction.

Our service level is a crucial element in our competitive advantage. This is why we have made clear and consistent communication an important priority. The current speed of communication and increased transparency through the use of social media gives us an opportunity to improve communications with our (future) tenants and to get instant feedback.

We also see added value in a community-based approach. The steady increase in the number of elderly people and smaller households, in combination with a lower level of social cohesiveness, is increasing the need for a sense of community in our rental properties. At Vesteda, we invest in the creation of communities in our complexes, for instance via pilots with dedicated community apps.

Corporate Sustainability and Social Responsibility (CSSR) is an essential part of our mission: we can only serve our communities if we ensure our continuity. Vesteda’s CSSR performance is an integral part of our business plan and are therefore firmly embedded in the business operations. We believe that our efforts in the field of CSSR improve and strengthen Vesteda, both directly and indirectly, that they result in future-proof returns on our investments, and that they help us to create value for all our stakeholders.

Portfolio: “Improve the quality and sustainability of our portfolio to ensure the stable growth of rental income and MSCI outperformance”

Our continuous focus on the quality and structure of Vesteda’s portfolio is the basis for outperformance and stable rental income growth. Our goal is a mid-market portfolio located in Vesteda’s chosen primary regions that consists of sustainable and future-proof properties; attractive and affordable, well-designed homes, tailored to specific target groups but flexible in terms of future use. Vesteda continuously monitors the performance of its assets and portfolio to ensure compliance with its desired risk/return profile. We constantly look for and identify opportunities to optimise or add value to standing assets. We invest in the quality of our standing assets and improve the sustainability of our standing portfolio in line with our long-term targets.

This focus on the quality of Vesteda’s portfolio is the best protection for potential economic downturns. New acquisitions have to meet Vesteda’s high quality standards and should have clear value growth potential. We prefer quality above volume and remain selective in general.

Our portfolio provides us with a strong presence in our primary regions, including major Dutch cities. We expect the urbanisation trend to continue and large cities in the Netherlands to grow into ‘urban regions’. These are the areas that will offer opportunities within this urbanisation trend and this is where we plan to dedicate our attention.

PropTech and big data are developing quickly, offering opportunities for the residential real estate sector to gain a better understanding of the market and tenants. They will improve the selection and definition of the products we invest in and to improve cost efficiency, the rental process and service levels to our tenants.

Participants: “Provide long-term investors with an attractive risk-return profile in a pure play Dutch core residential property fund”

Vesteda strives to provide its participants with good returns, transparency and the best possible service. We seek to continuously improve the dialogue with all our participants, and invest in establishing relationships with potential new participants. Vesteda values its strong and supportive investor base.

Vesteda wants to play a leading role in sustainable housing. We have set clear and ambitious CSSR targets, including a target for the GRESB benchmark score: a GRESB five-star rating and a ranking in the top three in the Netherlands. In 2019, we were once again awarded a five-star rating, improved our score and ranked third. However, it is unlikely that we will achieve first place. We believe the currently available certificates in the market for residential real estate are not of sufficient quality and will not help us to improve our sustainability in the future. Instead, we are investigating the merits of alternative certifications. We are participating in pilots and are actively contributing to initiatives to develop a certificate that will enable us to actually improve the sustainability of a building.

Organisation & staff: “Being a service-oriented organisation, supported by smart technology. Operated at attractive cost levels and regarded as an employer of choice”

Vesteda’s goal is to become a high-performance organisation. We aim to do so by offering an inspiring and pleasant environment to work in. The ERP system that is due to be implemented in mid-2020, is an important milestone on the road to becoming a high-performance organisation, as more integrated processes will help us to improve our efficiency and the collaboration across the company. It will also serve as the basis for further improvements and innovations, such as data science and artificial intelligence.

Our culture is built on collaboration and accountability. We have started a management development programme that will help us to further integrate and embed such a corporate culture.

In 2019, we introduced Vesteda Vitaal as a benefit to encourage our employees to live a more healthy and balanced lifestyle. Vesteda Vitaal offers our employees insight into their personal lifestyle, health risks and provides personalised advice how to improve that lifestyle.

Funding: “Provide a robust and well-diversified, flexible, and green funding structure with low leverage and low cost of largely fixed-rate debt.”

Over the last five years, Vesteda has significantly transformed its funding profile from primarily CMBS notes and bank facility-based funding to a well-diversified fully unsecured funding structure, consisting of a combination of bank debt, euro commercial paper (ECP), private placements and public bonds. We aim to further improve our funding profile by attracting new diversified funding at attractive interest rates. To ensure the successful execution of our funding strategy, we will invest more in our debt investor relations.