LOGG3

Log Commercial Properties e Participações S.A. is a Brazilian real estate company specialized in the development, leasing, and management of class A logistics condominiums. Founded in 2007, initially as MRV Logística e Participações S.A. within the MRV Engenharia group, the company was created with a focus on projects dedicated to logistics operations. In 2009, it delivered its first asset, the LOG I condominium in Contagem (MG), marking the effective start of its role as a developer of logistics warehouses. Over the following years, it received significant capital contributions from institutional investors such as Starwood Capital Group and 2bCapital, which drove the expansion of its portfolio. In 2012, it adopted the name Log Commercial Properties and, in 2018, after the spin-off from its then-parent company MRV Engenharia, it became an independent public company, with common shares traded on B3 under the ticker LOGG3, listed on the Novo Mercado corporate governance segment.

Since then, Log Commercial Properties has consolidated an integrated business model, operating throughout the real estate cycle focused on logistics assets: land development, standardized construction of warehouses, leasing of modules, condominium management and administration, and, occasionally, asset recycling through the sale of properties or undivided interests. The growth strategy was structured in successive cycles, such as the “TODOS POR 1”, “TODOS POR 1.4” and “TODOS POR 1.5” plans, which called for cumulative delivery of up to 1.5 million m² of gross leasable area (GLA) by 2024. In October 2023, the company presented a new cycle, the “LOG 2 MILHÕES” plan, designed to add a further 2 million m² of GLA between 2025 and 2028, maintaining expansion over a largely consolidated geographic base. In parallel, the company implemented successive programs for the repurchase and cancellation of common shares, adjusting its capital structure and the number of shares outstanding, always within the usual practices of listed companies.

Log Commercial Properties’ main activities are organized into three operating fronts: asset leasing, real estate development, and management and administration of logistics condominiums. Leasing is the main source of recurring revenue, based on long-term contracts for the occupation of modules in logistics and industrial warehouses, with monthly rental income. Real estate development covers everything from prospecting and acquiring land to project approval, obtaining permits, and building class A logistics condominiums in metropolitan regions and near major consumption centers. Condominium management and administration, internalized as of 2019 through the Log Adm unit, is responsible for the daily operation of the projects, including operational control services, commercial management, insurance, administrative support, and digital condominium solutions. In 2024, the company’s net operating revenue came mainly from leasing, supplemented by condominium management revenue and other smaller revenue sources.

From a portfolio perspective, Log Commercial Properties stands out as one of the largest lessors and developers of class A logistics warehouses in Brazil. At the end of the first quarter of 2024, the company reported approximately 1 million m² of delivered GLA, distributed across 31 cities in 18 states, plus the Federal District, with a strong presence in logistics-relevant areas in the Southeast, South, Northeast, and Center-West regions. On December 31, 2024, the total portfolio – including delivered, under-construction, and under-development GLA – reached around 1.9 million m², with 951,926 m² already delivered and the remainder at various stages of construction and planning. The company uses a modular warehouse model, which allows the condominiums to be divided into multiple modules to serve operations of different sizes and sectors, facilitating area absorption, reducing vacancy risk, and enabling flexible asset recycling strategies.

Log Commercial Properties’ client base is diversified by sector and number of contracts, focusing on companies that require logistics infrastructure for storage, distribution, and support for industrial and retail operations, including those related to e-commerce. In 2024, the company had 157 clients and 204 active lease contracts, with an average GLA of approximately 5,600 m² per contract. Revenue concentration in a single tenant is relatively low: the largest client accounted for 8.9% of gross revenue in the fiscal year ended December 31, 2024. The contract base generally consists of leases governed by Law No. 8,245/1991, with typical terms of three to five years, which can reach ten years in certain cases, and contractual guarantees such as letters of guarantee, surety insurance, or security deposits. This contractual structure, combined with diversification across the sectors served, reduces dependence on specific clients and mitigates default and vacancy risks.

Log Commercial Properties’ geographic footprint is one of the company’s strategic pillars, based on regional diversification and operations in markets considered strategic for logistics activities in Brazil. The selection of land takes into account studies of demographic, economic, and infrastructure trends, as well as local pricing dynamics and warehouse absorption. The company does not acquire ready-built assets; the entire portfolio is developed from the acquisition of land or equity interests in companies that own land. Operations are fully concentrated in the Brazilian market, such that 100% of net revenue is attributed to clients located in the country, with no revenue generated in foreign currency or in other markets. This geographic concentration entails direct exposure to the domestic economic cycle and the development of domestic logistics, with particular relevance to segments such as retail, industry, and especially e-commerce.

On the regulatory front, Log Commercial Properties’ activities are heavily conditioned by zoning and land-use rules, urban planning, environmental legislation, and civil construction regulations. Each project requires obtaining a set of permits and authorizations at different levels of government, including construction and operating permits, neighborhood impact studies, and preliminary, installation, and operating environmental licenses, in addition to registry documents and technical certifications issued by city governments, environmental agencies, and the Fire Department. The process of legalizing a typical project takes on average more than a year until full approval, plus additional time for issuance of the occupancy permit (“Habite-se”) after construction is completed. The company reports that obtaining these licenses occurs in the normal course of its activities, without highlighting significant delays or recurring conflicts with public authorities, although it acknowledges that regulatory changes can increase costs and limit development in certain areas.

In environmental, social, and governance (ESG) matters, Log Commercial Properties maintains a structured disclosure policy through annual Sustainability Reports. Since 2020, the company has adopted the GRI Standards methodology, in the Core option, aligned with the principles of the UN Global Compact and the Sustainable Development Goals. Starting with the reports based on 2022 and 2023, the content also began to consider the Integrated Reporting framework and SASB indicators specific to the infrastructure sector, with external verification carried out by an independent auditor. The company developed a materiality matrix with the participation of a broad group of stakeholders, including investors, clients, employees, suppliers, the media, and senior management, in order to prioritize topics relevant to the business and society. In corporate governance, listing on B3’s Novo Mercado, the active participation of independent board members, and the structure of investment and project analysis committees are presented as core elements of the company’s decision-making model and risk management.

Log Commercial Properties’ integrated operations, combining real estate development, in-house construction, leasing, condominium management, and asset recycling, differentiate the company within the logistics warehouse segment in the Brazilian capital markets. Asset recycling – the sale of projects or undivided interests to real estate funds and other investors – has been used as a significant source of funding for new growth cycles, with transactions totaling billions of reais in recent years. The presence of dedicated business units such as Log Adm and the standardization of construction and operating processes are intended to keep costs under control and increase capital efficiency, characteristics that directly influence the economic performance of LOGG3 shares traded on B3 and the company’s long-term real estate cash generation profile.