Immofinanz posts loss on devaluation of Immoeast portfolio

Austrian property investor Immofinanz announced a first-quarter loss Thursday, saying a hefty devaluation of the real estate portfolio of Immoeast, its unit focused on business in emerging markets in Europe, weighed on its results.

Immofinanz swung to a loss before interest and tax of EUR 191 mln in the quarter ending 31 July 2008 from a profit of EUR 183 mln in the same period last year. Immofinanz pointed to devaluations of EUR 294 mln at Immoeast, due to the revaluation of Central and Eastern European currencies compared to the euro and rising market yields in a large number of countries in which Immoeast invests. Immowest, in contrast, saw a small revaluation profit of EUR 2.6 mln.

Immofinanz and the 54%-controlled Immoeast said last Friday that they are taking 'comprehensive measures' to secure liquidity and reduce costs. Immoeast has decided to reduce its EUR 4.4 bn development pipeline by at least EUR 2 bn while the Immofinanz group plans to sell a total of EUR 800 mln in real estate assets by the end of the year.