BEFIMMO SA Press release
Embargo | 29 October 2015 | 5.40 PM CREATING VALUE IN REAL ESTATE
Interim statement of the Board of Directors for the period
from 1 July 2015 to 30 September 2015
Nine months into the fiscal year:
Stable fair value of portfolio (+0.50%)
EPRA earnings of €3.00 per share, higher than forecast
Confirmation of the interim dividend of €2.59 gross per share payable in December in cash and, optionally, in shares
Table of contents
The Board of Directors met on 27 October 2015 to establish the consolidated quarterly financial statements as at 30 September 2015.
1. Property portfolio as at 30 September 2015
Ongoing construction projects
Gateway | Brussels Airport
As reported previously, during the second quarter of the fiscal year, Befimmo acquired the Gateway1 project at the Brussels airport, representing a total investment amount of some €140 million. Building works are going ahead as scheduled, and €71 million has already been invested as at 30 September 2015. The 18-year lease with Deloitte will commence upon the handover of the building, planned before the end of 2016.
Paradis projects | Guillemins | Liège
In late September 2015 the Belgian Government, the Buildings Agency, the City of Liège and Fedimmo proudly opened the Paradis Tower in Liège. In December 2014, officials of the Federal Public Finance Service moved into their new working environment, which meets the highest standards.
Fedimmo is continuing to prepare the development of the site it owns adjacent to the Paradis Tower. The project, named Paradis Express, involves the construction of an eco-neighbourhood (about 35,000 m²) offering a mix of offices, housing and local shops. This project may be implemented gradually during the course of 2017.
Ongoing renovation projects
Befimmo continually invests in its portfolio to meet the needs of its rental customers and to keep its properties at a high level of quality, attractiveness and occupancy.
Accordingly, over the first three quarters of the fiscal year, Befimmo invested €16.11 million, including investments specifically allocated to optimise energy performances.
The projects in progress are notably:
Brederode 9 and Namur 48 | Centre | Brussels CBD:
The Brederode 9 and Namur 48 buildings are undergoing a major renovation at a total cost of around €14 million. These buildings will once again be available for rent as from mid-2016. Befimmo aims to achieve a 'Very Good' rating for the BREEAM certification in the Post Construction phase for the Brederode 9 building.
Guimard | Leopold district | Brussels CBD:
Befimmo has just obtained the necessary permits for the major renovation of its Guimard building (estimated amount of €12 million). Befimmo is aiming for a BREEAM 'Excellent' rating in the Design and Post Construction phases. The Guimard building will be available to let during the first half of the 2017 fiscal year.
1 For more information, please see the press releases of 10 March 2015 and 27 April 2015 published on the Befimmo website (www.befimmo.be).
Befimmo is also continuing its work of improving the environment and performance of its let buildings, notably in the Blue Tower, Media, Fountain Plaza and Ikaros buildings. Moreover, with the aim of offering the best services and solutions to its rental customers, Befimmo provides systems for flexible rent of common meeting rooms among others in the Blue Tower building (Louise district of Brussels) and the Media building (Brussels periphery).
Sale of the Mons II building
In early September 2015, Befimmo sold its Mons II building, located at Digue des Peupliers 71 in Mons, at a price equivalent to the fair value determined by an independent real-estate expert.
Property portfolio key figures
30.09.2015 | 30.06.2015 | 31.12.2014 | |
Fair value of portfolio (in € million) | 2 378.0 | 2 346.8 | 2 285.2 |
Gross initial yield on properties available for lease | 6.15% | 6.19% | 6.28% |
Gross potential yield on properties available for lease | 6.56% | 6.61% | 6.68% |
Occupancy rate of properties available for lease | 93.70% | 93.68% | 94.07% |
Weighted average duration of leases | 8.61 years | 8.78 years | 8.64 years |
EPRA vacancy rate of properties available for lease 6.79% 6.84% 6.50%
Blue Tower | Louise district | Brussels CBD
Change in fair values2 of the property portfolio
Offices | Change over the quarter(a) (in %) | Proportion of portfolio(b) (30.09.2015) (in %) | Fair value (30.09.2015) (in € million) | Fair value (30.06.2015) (in € million) | Fair value (31.12.2014) (in € million) |
Brussels centre (CBD) | 0.95 | 52.1 | 1 239.6 | 1 227.1 | 1 233.5 |
Brussels decentralised | -0.42 | 3.9 | 92.7 | 92.8 | 97.1 |
Brussels periphery | 0.05 | 6.0 | 142.6 | 141.2 | 144.3 |
Flanders | 0.26 | 20.7 | 492.2 | 490.9 | 483.3 |
Wallonia | 0.09 | 7.9 | 187.1 | 186.4 | 179.8 |
Luxembourg city | -0.06 | 3.7 | 86.7 | 86.7 | 84.6 |
Properties available for lease | 0.57 | 94.2 | 2 240.9 | 2 225.2 | 2 222.6 |
Properties that are being constructed or developed for own account in order to be leased | 0.11 | 5.8 | 137.1 | 119.6 | 60.7 |
Investment properties | 0.54 | 100.0 | 2 378.0 | 2 344.7 | 2 283.3 |
Properties held for sale | - | - | - | 2.1 | 2.0 |
Total | 0.54 | 100.0 | 2 378.0 | 2 346.8 | 2 285.2 |
(a) The change over the quarter is the change in fair value between 1 July 2015 and 30 September 2015 (excluding the amount of the acquisition, the investments and the disinvestment).
(b) The proportion of portfolio is calculated on the basis of the fair value of the portfolio as at 30 September 2015.
As at 30 September 2015, the fair value of Befimmo's consolidated portfolio is €2,378.0 million, as against €2,346.8 million as at 30 June 2015 and €2,285.2 million as at 31 December 2014.
This change in value incorporates:
the renovation works carried out in the portfolio;
the acquisition of the Gateway project as the construction works progress;
the sale of the Mons II building;
the changes in fair value booked to the income statement (IAS 40).
Excluding the amount of the acquisition, the investments and the disinvestment, the fair value of the portfolio rose slightly (€11.8 million or +0.50%) over the first three quarters of the fiscal year.
2 These values are established in application of the IAS 40 standard which requires investment properties to be booked at 'fair value'. Fair value is obtained by deducting the average costs for transactions established by independent real- estate experts, from the 'investment value'. These costs amount to (i) 2.5% for property worth more than €2.5 million and (ii) 10% (Flanders) or 12.5% (Wallonia and Brussels) for property worth less than €2.5 million.
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