MERLIN Properties SOCIMI (MRL) investor relations material

Market Trends and Strategic Positioning

• Global AI workload demand is projected to grow 3.5x from 2025 to 2030, creating significant opportunities for data center expansion in Spain and Iberia, which are poised for rapid growth.

• The Iberian Peninsula offers abundant renewable energy, competitive power costs, ample land, and strategic connectivity via subsea cables, making it an ideal location for high-density AI data centers.

• The company leverages in-house expertise across energy, design, construction, technology, and operations, focusing on modular, scalable, and ultra-efficient infrastructure for AI and hyperscaler clients.

• Strong relationships with Tier-1 hyperscalers and AI players, including being an NVIDIA preferred partner, position the company as a reliable long-term partner.

• Operational excellence is driven by industrialized processes, proprietary cooling technology, supply chain management, and a highly trained workforce.

Financial Performance and Capital Deployment

• Phase I delivered 64 MW on time and on budget, achieving a 15.8% gross yield on cost and a potential 2x valuation uplift.

• Phase II and III expand total IT capacity to 730 MW by 2032, with €7.8bn total investment and stabilized GRI of €1.15bn.

• Maintains low leverage (28.9% LTV), strong liquidity (€1.2bn cash, €740m RCF), and solid credit ratings (BBB+/Baa1).

• Phase III funding plan targets a 50/50 debt-to-equity split, with a preference for internal capital and green bonds, while maintaining strong credit ratings and balance sheet flexibility.

• Secures competitive and sustainable power via PPAs and direct renewable sourcing, acting as an energy solutions partner.

Phase III Expansion

• Phase III will add 412 MW of high-density, AI-ready capacity across campuses in Bilbao (+162 MW), Lisbon (+100 MW), and Zaragoza (+150 MW), with a total investment of €4.47bn and a projected gross yield on cost of 14.7%.

• The new phase is expected to generate around EUR 650 million in additional revenue, maintaining yield levels despite higher land and power costs.

• Construction timelines are being compressed to three years, leveraging preparatory work and industrialized processes to accelerate time to market.

• First RFS is expected in 1H29, with full stabilization by 2032.

• Full execution of Phase III is projected to triple the company’s top line and increase the share of data centers in revenue tenfold.