Austrian office-focused property developer CA Immo has announced plans to independently develop residential properties, as part of a strategy to monetise its existing land reserves which have been earmarked for residential construction.
In its 2017 H1 earnings statement, the developer said that 'while the in-house development of high quality office properties in the core markets of CA Immo... constitutes a driver of organic growth (especially in Germany) ... the development and utilisation of non-strategic properties is also serving to generate value.'
Currently, CA Immo's core business focuses on developing offices in central European capitals. Around 88% of its €3.9 bn portfolio is represented by office space.
It added: 'In this context, the company has decided to develop land earmarked for residential construction, which in future will enable it to generate profits associated with sales completely independently. Given the significant share of residential construction in the development pipeline announced earlier, another important foundation for increasing the profitability of CA Immo Group has been established.'
CA Immo said that it was also exammining the possiblity of entering into the indirect property fund business to realise this, in partnership with an external, regulated service provider.
CA Immo's earnings report showed an improvement in funds from operations (FFO), recorded at €56.3 mln, an increase of 28.5% on the same period last year.
