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Pressemitteilung BoxID: 327821 (alstria office REIT-AG)
  • alstria office REIT-AG
  • Fuhlentwiete 12
  • 20355 Hamburg
  • http://www.alstria.de
  • Ansprechpartner
  • Janina Wismar
  • +49 (40) 226341-340

alstria: Strong operations, 5% devaluation of portfolio

(PresseBox) (Hamburg, ) .
-Revenues and FFO in line with company guidance
-Syndicated loan amount reduced by 35% to EUR 651 million
-Additional sale of portfolio worth EUR 84.2 million at 11% premium
-G-REIT equity ratio significantly improved in Q1 2010
-Dividend of EUR 0.50 per share to be proposed to AGM

alstria office REIT-AG, an internally managed Real Estate Investment Trust (REIT), successfully managed to strengthen the balance sheet and to keep revenues and funds from operations (FFO) in line with the guidance in 2009. By selectively refinancing and selling assets the company kept the Loanto-Value Ratio (LTV) of the syndicated loan close but below 60%, while reducing the balloon payment from EUR 1.1 billion to EUR 651 million.

"Through our strong focus on operations, selective sales and refinancing alstria was able to successfully navigate through a very challenging environment in 2009," comments Olivier Elamine, Chief Executive Officer of alstria. "We have today one of the strongest balance sheets in the German real estate industry, with more than EUR 50 million of free cash that we could deploy rapidly if we would identify attractive opportunities in the market," adds Alexander Dexne, Chief Financial Officer of alstria.

Revenue development, funds from operations and net income

Revenues and funds from operations (FFO) in the 2009 financial year were in line with the company's full year guidance: Revenues amounted to EUR 102.5 million (2008: EUR 102.1 million). Net rental income in 2009 totalled about EUR 92 million (2008: EUR 93.2 million). As expected the FFO which came in at EUR 32.7 million (2008: EUR 39.4 million) was impacted by higher financial costs, as well as an acceleration in asset management activities.

The consolidated loss amounted to EUR 79.7 million (2008: consolidated loss of EUR 56 million), or EUR 1.44 per share. This loss is attributable primarily to a noncash devaluation of the real estate portfolio (EUR 86 million), as well as devaluation and termination of interest rate hedges (EUR 23 million).

Financial and asset position

At yearend 2009, alstria's portfolio was valued at EUR 1.6 billion, which reflects a valuation yield of 6.2% (5.9% in 2008). Net asset value (NAV) decreased year on year by approx. 13.1% to EUR 634 million. This decrease was mainly driven by the noncash devaluation of investment properties and the impact of the marktomarket of hedge instruments. The NAV per share stood at EUR 11.32 down from EUR 13.03 in 2008.

alstria was in line with all its debt covenants at yearend with an LTV on its main credit facility at 59.8% versus a covenant at 65%.

Dividend for 2009

For the financial year 2009, the management board will propose to the Annual General Meeting a dividend of EUR 0.50 per share.

Operational achievements

In one of the most challenging investment markets on record, alstria was able to dispose EUR 141 million of assets in line with the 2008 year end valuation. Despite this strong disposal track record, and evidence of the high quality of alstria's portfolio, alstria had to book a noncash portfolio valuation loss of EUR 86 million. This devaluation was mainly driven by writedown on assets which are larger than EUR 50 million, and/or with lease maturities which are shorter than 10 years. 19 assets representing 25% of the portfolio in terms of asset numbers have caused more than 80% of the total devaluation.

alstria's strong focus on asset management allowed the company to make significant progress on its refurbishment projects. The building permit on the landmark Alte Post building in Hamburg was obtained allowing the leasing process to start, and the vacant building acquired in Hamburg in mid-2009 has been fully refurbished and let on a longterm lease basis. Although alstria has only disposed fully let buildings the vacancy rate remains stable at around 5.7%. The 2009 likeforlike rental growth on the investment portfolio of alstria was at 1.4% for the year.

Post closing events: New portfolio sale and refinancing

alstria signed a binding agreement for the sale of a real estate portfolio located in Hamburg for a total consideration of EUR 84.2 million. The agreed purchase price values the portfolio at a premium of 11% and 4% above 2009 and 2008 book values respectively. The portfolio represents a gross rental income of EUR 3.86 million per year secured for 15 years.

Following the signature of the new joint venture that was announced on February 22, alstria repaid EUR 28 million on its main syndicated loan facility. Also, alstria entered into a new nonrecourse credit facility of EUR 76 million and a 7years maturity to refinance four properties in Hamburg, Essen and Leipzig with an average lease term of 8 years. The interest rate on this loan is fixed until maturity at 4.62%. After this refinancing and the above mentioned disposals, the remaining main syndicated loan facility exposure is EUR 651 million with an average cost of debt for alstria at 4.3%.

G-REIT equity ratio significantly improved

The G-REIT equity ratio for FY2009 remained at 40.3% unchanged from FY2008 despite the net loss, and below the 45% requirement of the REIT law. However, this does not challenge the tax free status of alstria, as the REIT law provides for a 3year cure period (i.e. December 31, 2010). Taking into consideration the closing of the transactions in the first months of 2010 the G-REIT equity ratio is expected to significantly increase from 40.3% to more than 43%.

Outlook

On the basis of the most recent transactions and the rent that has already been contractually agreed, alstria expects revenues of EUR 89 million and an operational result (FFO) of EUR 27 million in the financial year 2010.

Full financial figures and annual report of the company will be published on March 31, 2010.

alstria office REIT-AG

alstria office REIT-AG (symbol: AOX, ISIN: DE000A0LD2U1) is an internally managed Real Estate Investment Trust (REIT) solely focused on acquiring, owning and managing office real estate in Germany. alstria was founded in January 2006 and was converted into the first German REIT in October 2007. It is based in Hamburg.

alstria owns a diversified portfolio of properties across attractive German office real estate markets. Its current portfolio comprises 74 properties with an aggregate lettable space of approximately 821,000 sqm and is valued at approximately EUR 1.4 billion.

The alstria office REIT-AG strategy is based on active asset and portfolio management as well as on establishing and maintaining good relationships with key customers and decision makers. alstria focuses on longterm real estate value creation.

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