1. Activity report period 01/07/2015-30/09/2015
Sale warehouse Wenenstraat in Meer
On 20 October 2015 the notarial deed for the sale of a less important non-strategic storage building located Wenenstraat in Meer was recorded for a sales price of € 1.5 million.
Completion of structural shell work of office project Royal20 in the Grand Duchy of Luxembourg
In the Grand Duchy of Luxembourg the structural shell work of the office project 'Royal20' at boulevard Royal in the center of the city of Luxembourg was finalized. The spectacular façade of the building has in the meanwhile become very visible. For the construction of the façade with tailor-made glass panels, high-tech engineering was called upon.
The final reception of the office project and the transfer of property are expected to take place in the second quarter of 2016.
Redevelopment Square de Meeûs in 1000 Brussels
This building of 5,500 m², located in the central business district of Brussels will be entirely rebuilt as a Triple A building that will meet the highest quality standards as to sustainability (Breeam Excellent certificate expected) and technology. Square de Meeûs benefits from a unique location amidst the European district. The building permit for this project has been introduced and the building will be commercialized in 2017 when the offer of new buildings will be limited.
In Belgium the rental contract with the European Parliament was extended for one year, for the building Montoyer 63 in 1000 Brussels, resulting in the fact that the planned redevelopment will start in 2017 instead of in 2016. In the meanwhile, the building permit is being treated. The reception of the new building is consequently foreseen in the course of 2018.
In the Grand Duchy of Luxembourg a new rental contract was concluded with one of the current tenants for the retail site in Strassen for 4,100 m2, entering into effect on 1/01/2017 for a fixed period of 15 years. This new rental contract fits within the framework of the planned redevelopment of the Strassen site that will become a real shopping center and comprise over 22,000 m2 in total (cf. supra).
Sale of bearer shares in accordance with article 11 of the law of 14/12/2005
On 06/10/2015 Leasinvest Real Estate proceeded to the sale of bearer securities of which the holders had not reported themselves on 17 July 2015. This sale took place on 06/10/2015 on Euronext Brussels (cf. publication Belgian Official Gazette of 2/09/2015) and related to 3,392 shares, redeemed by Leasinvest Real Estate itself against a share price of
€ 82 per share.
New Chief Financial Officer
At the beginning of November Piet Vervinckt has taken office as Chief Financial Officer. Previously, Piet Vervinckt worked at BNP Paribas Fortis as senior relationship manager for 18 years, of which nearly 10 years in BNP Paribas Fortis Real Estate Finance where he gained an extensive experience in bank financing of real estate investors and developers. He was before joining Leasinvest Real Esate also non-executive director within some real estate companies.
EPRA Gold Award for Annual financial report 2014
For the third year in a row Leasinvest Real Estate received an EPRA Gold Award for its annual financial report 2014. The EPRA Best Practices Recommendations make the financial statements of public real estate companies clearer and more comparable across Europe. This in turn enhances the transparency and coherence of the sector as a whole and plays an important role in attracting global flows of capital into the European listed property sector. (www.epra.com).
2. Key figures
|Key figures real estate portfolio (1)||30/09/2015||30/09/2014||31/12/2014|
|Fair value real estate portfolio (€ 1,000) (2)||756,721||709,413||756,327|
|Fair value investment properties including participation Retail Estates (€ 1,000) (2)||825,363||754,253||808,126|
|Investment value investment properties (€ 1,000) (3)||771,050||722,630||770,680|
|Rental yield based on fair value (4) (5)||7.23%||7.24%||7.23%|
|Rental yield based on investment value (4) (5)||7.10%||7.11%||7.10%|
|Occupancy rate (5) (6)||97.31%||95.82%||96.24%|
|Average duration of leases (years)||5.19||4.88||5.08|
(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 30/09/2015.
(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)||356,013||326,269||336,410|
|Net asset value group share per share||72.1||66.1||68.1|
|Net asset value group share per share based on investment value||75.0||68.7||71.0|
|Net asset value group share per share EPRA||79.7||72.2||75.5|
|Total assets (€ 1,000)||862,465||781,483||836,914|
|Financial debt ratio||53.29%||53.18%||54.27%|
|Average duration credit lines (years)||2.49||3.16||3.2|
|Average funding cost (excl. changes in fair value fin. instruments)||3.53%||3.66%||3.63%|
|Average duration hedges (years)||6.55||5.63||6.13|
|Rental income (€ 1,000)||37,600||37,607||50,175|
|Net rental result per share||7.61||7.61||10.16|
|Net current result (€ 1,000)||18,487||20,783||26,062|
|Net current result per share||3.74||4.21||5.28|
|Net result group share (€ 1,000)||25,391||21,303||32,572|
|Net result group share per share||5.14||4.31||6.60|
|Comprehensive income group share (€ 1,000)||42,062||11,183||21,321|
|Comprehensive income group share per share||8.52||2.26||4.32|
(1) The net current result consists of the net result excluding the portfolio result and the changes in fair value of the inefficient hedges.
3. Consolidated results period 01/01/15-30/09/15
For Leasinvest Real Estate the 3rd quarter of 2015 is in line with the outlook.
The rental income is approximately identical to the same period of last year and amounts to € 37,600 thousand at the end of September 2015, in comparison with € 37,607 thousand end-September 2014. At constant portfolio the rental income decreases by 3.4 % or € 1,286 thousand in comparison with the same period last year (excl. rental rebates). This decrease is explained by the temporary vacancy in the building Monnet under renovation and the office building Square de Meeus that will be entirely redeveloped.
The average duration of the leases has increased to 5.19 years in comparison with 5.08 years end-December 2014.
The gross rental yields show a similar trend with end-2014 and amount to 7.23% (December 2014: 7.23%) based on the fair value and to 7.10% (December 2014: 7.10%) based on the investment value. The occupancy rate amounts to 97.31% (December 2014: 96.24%), an increase explained by the sale of Kiem and the higher occupancy of The Crescent and EBBC, and the temporary extension of a current tenant in Canal Logistics phase 1. In the calculation of the occupancy rate, the development projects, i.e. Royal 20, Monnet and Square de Meeûs are not included.
The fair value of the direct real estate portfolio is quasi identical and amounts to € 756.7 million end-September 2015 compared to € 756.3 million end-December 2014. The value remained stable despite the sale of the buildings Kiem and Canal Logics phase 2, and this following a positive evolution of the fair value of the assets and liabilities, more specifically of the fair value with regard to the buildings Monnet and Royal 20, both located in Luxembourg.
The operating result decreases by € 1.7 million following higher property charges, among which technical and commercial costs and costs of un-let buildings (mainly caused by the temporary vacancy of the buildings Monnet, Square de Meeûs and Canal Logistics phase 2) and amounts to € 29.9 million end-September 2015 in comparison with
€ 31.7 million end-September 2014.
The net current result over the first 9 months amounts to € 18.49 million (or € 3.74 per share), in comparison with a net current result of € 20.78 million (or € 4.21 per share) end-September 2014. This decrease is mainly the consequence of higher property charges (technical costs) in comparison with the same period of last year.
The net result, group share amounts to € 25.39 million end-September 2015 compared to € 21.30 million end-September 2014. In terms of net result per share this results in € 5.14 end-September 2015 compared to € 4.31 end-September 2014. The net result has increased, mainly due to a higher portfolio result (before exchange rate difference) of € 7.2 million.
The financial result amounts to € - 13.87 million end-September 2015 in comparison with € - 9.51 million for the same period last year. This evolution is explained by the negative evolution of the fair value of the assets and liabilities, mainly by the exchange rate part of the cross currency swap (€ - 4.06 million). Not taking into account the CHF/Euro effect, the financial charges increase to € -9.81 million (30/09/2015) compared to € -9.51 million (30/09/2014).
The average funding cost decreased end-September 2015 and amounts to 3.53% compared to 3.63% end 2014.
At the end of the third quarter of the financial year 2015 shareholders' equity, group share (based on the fair value of the investment properties) amounts to € 356.01 million (December 2014: € 336.4 million).
End-September 2015 the net asset value per share amounted to € 72.1 (31/12/14: € 68.1) and the closing price of the Leasinvest Real Estate share was € 81.05, or 12.41% 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 € 79.70 end-September 2015 in comparison with € 75.5 end 2014.
End-September 2015 the debt ratio stands at 53.29% in comparison with 54.27% end 2014.
Except for extraordinary circumstances and new investments, the company expects to realize a slightly lower net result and a slightly lower 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. The company expects to maintain the dividend over 2015 at minimum the same level.
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 € 757 million spread across the Grand Duchy of Luxembourg (61%), Belgium (33%) and Switzerland (6%). Moreover, Leasinvest is the largest real estate investor in Luxembourg.
The total portfolio is invested in retail (46%), offices (36%) and logistics (18%).
The RREC is listed on Euronext Brussels and has a market capitalization of approximately € 432 million (value 16/11/ 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.
 For more information we refer to p 3 of the half-year financial report 2015.
 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 is calculated as the net result excluding the portfolio result on the one hand, and the changes in fair value of the ineffective hedges, on the other hand.