I. Interim statement of the manager over the first quarter of the financial year 2015
1. Activity report period 01/01/15- 31/03/15
Divestment Kiem in the Grand Duchy of Luxembourg
On 16 March 2015 Leasinvest Real Estate has sold the office building Kiem located rue Kiem in Strassen in the Grand Duchy of Luxembourg to a private investor for an amount of € 6.3 million (excluding costs), which corresponds to the fair value. The building comprises 1,700 m2 and 50 parking spaces.
The building is located in the periphery and is part of a complex of 3 similar office buildings located between the route d'Arlon and the rue Kiem. The occupancy of the building was only 20% and it is not considered as strategic.
Sales agreement for the office project under construction Royal 20 in the Grand Duchy of Luxembourg
On 20 April 2015 Leasinvest Real Estate, via its 100% subsidiary in Luxembourg, Leasinvest Immo Lux, has concluded a future sales agreement ("vente à terme "), that will be subject to a notary deed shortly, subject to the completion of the building, for the office project under construction Royal20, located boulevard Royal in the center of the city of Luxembourg in the Grand Duchy of Luxembourg, for an amount of € 62.5 million (excluding VAT). The buyer is a family fund under Luxembourg law, directed by Edmond de Rothschild (Europe). The foreseen final completion of the office building and the transfer of the property rights are expected to take place in the second quarter of 2016. End 2014 a rental contract was concluded with China Merchants Bank for a fixed period of 10 years.
In the first quarter of 2015 an additional services contract was concluded for the building The Crescent in Anderlecht, which makes that the occupancy rate has risen in the meanwhile to 90%. By the higher number of users of the services offered (catering, fitness, meeting rooms) this results in an even higher financial occupancy rate.
As already announced in the press release dated 13/02/2015 with regard to the annual results 2014, the building Square de Meeûs located in the central business district of Brussels became vacant. Leasinvest uses this opportunity to entirely rebuild this building of 5,500 m² as a Triple-A building that will respond to the highest quality standards with regard to sustainability and technology. This building, with its unique location in the center of the European District, will be positioned in the market in 2017 whereby the offer of new buildings will be limited.
For the building Monnet in the Grand Duchy of Luxembourg, that is currently undergoing a profound renovation, the prospects for entirely letting this building by the end of 2015 are very real. One floor of this building is already temporarily leased to China Merchants Bank, the future tenant of the office project R20 located boulevard Royal in the city of Luxembourg, of which the final completion is expected in the course of the second quarter of 2016.
2. Key figures
|Key figures real estate portfolio (1)||31/03/2015||31/03/2014|
|Fair value real estate portfolio (€ 1,000) (2)||758,151||710,674|
| Fair value real estate portfolio, incl. participation Retail Estates |
(€ 1,000) (2)
|Investment value real estate portfolio (€ 1,000) (3)||772,560||724,070|
|Rental yield based on fair value (4) (5)||7.30%||7.33%|
|Rental yield based on investment value (4) (5)||7.17%||7.20%|
|Occupancy rate (5) (6)||98.35%||96.81%|
|Average duration of leases (years)||5.04||4.96|
(1) The real estate portfolio comprises the buildings in operation, the development projects, the assets held for sale, as well as the buildings presented as financial leasing under IFRS.
(2) Fair value: the investment value as defined by an independent real estate expert and of which the transfer rights have been deducted. The fair value is the accounting value under IFRS. The fair value of Retail Estates has been defined based on the share price on 31/03/2015.
(3) The investment value is the value as defined by an independent real estate expert and of which the transfer rights have not yet been deducted.
(4) Fair value and investment value estimated by real estate experts Cushman & Wakefield / Winssinger and Associates / Stadim / SPG Intercity.
(5) For the calculation of the rental yield and the occupancy rate only the buildings in operation are taken into account, excluding the assets held for sale.
(6) The occupancy rate has been calculated based on the estimated rental value.
|Net asset value group share (€ 1,000)||343,796||339,830|
|Net asset value group share per share||69.6||68.8|
|Net asset value group share per share based on investment value||72.5||71.5|
|Net asset value group share per share < EPRA||78.8||73.4|
|Total assets (€ 1.000)||845,696||782,411|
|Financial debt ratio (pursuant RD 13/07/2014)||52.92%||52.66%|
|Average duration credit lines (years)||3.02||3.44|
|Average funding cost (excl. fair value changes hedges)||3.47%||3.66%|
|Average duration hedges (years)||6.52||5.59|
|Rental income (€ 1,000)||12,610||12,523|
|Net rental result per share||2.55||2.54|
|Net current result (€ 1,000) (1)||5,584||5,857|
|Net current result per share (1)||1.13||1.19|
|Net result group share (€ 1,000)||3,597||7,508|
|Net result group share per share||0.73||1.52|
|Comprehensive income group share (€ 1,000)||7,371||4,499|
|Comprehensive income group share per share||1.49||0.91|
(1) The net current result consists of the net result excluding the portfolio result and the changes in fair value of the ineffective hedges.
3. Consolidated results period 01/01/15- 31/03/15
The first quarter of 2015 is in line with expectations for Leasinvest Real Estate.
The rental income is nearly identical to that of the same period of last year and amounts to € 12,610 thousand at the end of March 2015 in comparison with € 12,523 thousand end March 2014. At constant portfolio the rental income decreases by 0.7% or € 334 thousand in comparison with the same period last year (excl. rental rebates). This decrease is explained by the temporary vacancy in the Monnet building, currently under renovation.
The gross rental yields have slightly increased in comparison with end 2014 and stand at 7.30% (end 2014: 7.23%) based on the fair value and at 7.17% (end 2014: 7.10%) based on the investment value. The occupancy rate amounts to 98.35% (end 2014: 96.24%), an increase explained by the sale of Kiem and the higher occupancy of The Crescent, currently reaching 90%. The calculation of the occupancy rate does not comprise the current projects, i.e. Royal 20 and Monnet.
The fair value of the direct real estate portfolio is quasi identical and stands at € 758.1 million end March 2015 compared to € 756.3 million end December 2014.
The net current result of the first quarter amounts to € 5.6 million (or € 1.13 per share), in comparison with the net current result of € 5.9 million (or € 1.19 per share) end March 2014. This slight decrease is mainly the consequence of higher property charges (technical costs) in comparison with the same period last year.
The net result, group share amounts to € 3.6 million end March 2015 compared to € 7.5 million end March 2014. In terms of net result per share this results in € 0.73 end March 2015 in comparison with € 1.52 end March 2014. The decrease is explained by a diminution of the real estate portfolio (before the effect of exchange rate differences) by
- € 3.8 million in comparison with the same period last year, when the portfolio result was positively influenced for nearly € 2 million by the divestments.
The financial result amounts to - € 9.7 million end March 2015 in comparison with - € 3.9 million for the same period last year. This evolution is explained by the negative evolution of the fair value of the assets and liabilities following the evolution of the Swiss Franc (- € 5.9 million). This effect is integrally compensated by a positive translation difference on the buildings in Switzerland of € 5.8 million, presented under 'result on the portfolio', resulting in the fact that the impact on the net result and the net current result is nil.
The average funding cost decreased end March 2015 and stands at 3.47% compared to 3.63% end 2014.
At the end of the first quarter of the financial year 2015 shareholders' equity, group share (based on the fair value of the investment properties) amounts to € 343.8 million (2014: € 336.4 million).
End March 2015 the net asset value per share stood at € 69.6 (31/12/14: € 68.1) and the closing price of the Leasinvest Real Estate share amounted to € 93.94, or 35% higher than the net asset value. The net asset value per share excl. the influence of fair value adjustments on financial instruments (EPRA) also rises and amounts to € 78.8 end March 2015 in comparison with € 75.5 end 2014.
End March 2015 the debt ratio stands at 52.92% in comparison with 54.27% end 2014.
Except for extraordinary circumstances and new investments, the company expects to realize a lower net result and net current result in 2015 than in 2014 due to the influence on the evolution of the rents of the planned redevelopments Monnet and Square de Meeûs. Notwithstanding this evolution, the company expects to maintain the dividend over 2015 at minimum the same level.
II. Report of the ordinary general meeting held on 18 May 2015
1. Approval of the annual accounts
The ordinary general meeting of shareholders of 18 May 2015 has approved the statutory and consolidated annual accounts of Leasinvest Real Estate, closed at 31 December 2014, including the appropriation of the profit.
2. Dividend of the financial year 2014
The ordinary general meeting of shareholders of 18 May 2015 has approved the proposal of the board of directors to pay, on 26 May 2015 a dividend of € 4.55 gross and net, free of 25% withholding tax, € 3.4125.
Dividends will be paid out as of 26 May 2015 at the financial institutions Bank Delen (main paying agent), ING Bank, Belfius Bank, BNP Paribas Fortis Bank and Bank Degroof, upon presentation of coupon no 18.
The Ex-date is 22/05/2015 and the Record date is 25/05/2015.
3. Renewal of the mandate of the auditor for a period of 3 years
The general meeting has decided, on the proposal of the audit committee, to extend the mandate of the auditor ERNST & YOUNG BEDRIJFSREVISOREN - REVISEURS D'ENTREPRISES, with registered office in 1831 Diegem, De Kleetlaan 2, represented by Mr Pierre Vanderbeek, for a period of 3 years, i.e. for the financial years 2015, 2016 and 2017. His mandate ends after the annual meeting that will be held in 2018. The annual remuneration of the auditor for auditing the annual accounts for the finanancial year 2015 will be defined under comparable conditions, namely an amount of
€ 32,907 (excl. VAT).
4. Composition of the board of directors of the Manager
At the level of the statutory manager of Leasinvest Real Estate, i.e. Leasinvest Real Estate Management SA, Mrs Sonja Rottiers, CFO of AXA Belgium was appointed director of Leasinvest Real Estate Management SA (non-executive director) on 18 May 2015, for a term of 2 years, i.e. till the annual meeting that will be held in 2017. She will also be part of the audit committee.
At that same date, the mandate of Mr Thierry Rousselle (non-executive director and member of the audit committee) ended.
For more information, contact:
Leasinvest Real Estate
T: +32 3 238 98 77
Leasinvest Real Estate SCA
Regulated real estate company (B-REIT) Leasinvest Real Estate SCA invests in high quality and well-located retail buildings, offices and logistics buildings in the Grand Duchy of Luxembourg, in Belgium and in Switzerland.
At present the total fair value of the directly held real estate portfolio of Leasinvest amounts to over € 750 million spread across the Grand Duchy of Luxembourg (59%), Belgium (36%) and Switzerland (5%). Moreover, Leasinvest is the largest real estate investor in Luxembourg.
The total portfolio is invested in retail (45%), offices (35%) and logistics (20%).
The RREC is listed on Euronext Brussels and has a market capitalization of approximately € 435 million (value 15 May 2015).
 The value agreed upon takes into account the provisions of article 40 §1 of the law of 12 May 2014 with regard to RRECs.
 Fair value: the investment value as defined by an independent real estate expert and of which the transfer rights have been deducted. The fair value is the accounting value under IFRS.
 The net current result consists of the net result excluding the portfolio result and the changes in fair value of the ineffective hedges.