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The World Trade Center Moscow is the owner of a business complex on Krasnopresnenskaya Embankment in Moscow: office towers, hotels, a congress centre and restaurants. The company does not build or sell real estate — it manages it and leases it out. Its ordinary and preferred shares trade under the tickers WTCM and WTCMP.
A rental business is fundamentally different from a development business. A developer builds, sells and moves on; a landlord owns the property for decades and collects a stream of payments. Revenue here is predictable for years ahead — it is fixed by the lease agreements.
The key variables are occupancy and the rental rate. An empty floor carries the same maintenance costs as an occupied one, so a fall in occupancy hits profit disproportionately hard.
The hotel and congress parts work differently: they depend on business traffic and events, that is, on whether people travel to meetings. This is the part of the complex most sensitive to external circumstances.
Leasing of premises in the business towers of the complex.
Guest accommodation, which depends on business and tourist traffic.
Hosting of conferences, exhibitions and business events.
Strengths and weaknesses describe the business itself. Opportunities and threats describe what may happen around it.
The company owns a business complex in Moscow and manages it: it leases out offices, runs hotels, and hosts conferences and exhibitions in the congress centre.
A developer builds a property, sells it and moves on to the next one. A landlord owns the building for decades and collects a stream of rental payments — smaller as a one-off sum, but predictable and long-lasting.
Because the cost of maintaining the building hardly depends on whether a floor is occupied or empty: heating, security, cleaning and taxes are incurred in any case. Every vacant metre is a direct loss, while every metre let above the break-even point brings in almost pure profit.