MRM // 2021 Universal Registration Document

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General information on the issuer and its share capital

Consolidated nancial statements for the nancial year ended 31 December 2021

Note 5 Notes to the statement of comprehensive income

5.1 Gross rental income

Accounting principles

Recognition of income IFRS 15 - Revenue from Contracts with Customers - specifies how rental income from leases, and direct initial costs incurred by the lessor, should be recognised. These rents are recognised in income on a straight-line basis over the entire term of the lease. The effect of this standard is to spread the financial consequences of all the clauses contained in the lease over the life of the lease. This is the case for rent-free periods, stepped rents and key money.

Key money Key money payable to the lessor is classified as additional rent.

Key money forms part of the net amount exchanged between the lessor and tenant under a lease.

As such, the accounting periods during which this net amount is recorded must not be affected by the terms of the agreement and payment dates. These charges must be staggered over the first firm period of the lease.

Cancellation penalty Tenants may be required to pay cancellation penalties if they cancel their lease before its contract expires. Where applicable, the portion of these penalties similar to rental income is spread over the remaining term of the lease and booked under “Rental income”.

Compensation for eviction The lessor may be required to compensate the tenant for eviction if the former cancels the lease.

Replacement of the tenant: if the compensation for eviction modifies or maintains the asset’s yield (increase in rent and thus in the asset’s value), according to the amendments to IAS 16 this expense can be capitalised into the cost of the asset subject to appraisers confirming the increase in value. Otherwise, the expense is recorded as such. Property refurbishment requiring the departure of the existing tenants: if the compensation for eviction is made in the context of heavy refurbishing or reconstruction requiring the tenants’ prior departure, it is considered a preliminary expense included as an additional component after the refurbishment works.

Of the €9,745 thousand in gross rental income for 2021, variable rents totalled €70 thousand.

Rents receivable under firm leases in the portfolio

31/12/2021

(in thousands of euros)

Less than 1 year

9,508

Between 1 and 5 years

17,634

Over 5 years

3,511

TOTAL FUTURE MINIMUM PAYMENTS

30,653

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M.R.M. 2021 UNIVERSAL REGISTRATION DOCUMENT