Orco Property Group said the value of its real estate portfolio stood at EUR 1.83 bn at end-June, down 12% on the EUR 2.13 bn value at end-December 2008 due to difficult economic conditions and a 'conservative valuation of projects put on hold'. Net asset value came to EUR 15 per share, down from EUR 42.5 mln at end-December.
Orco Property Group said the value of its real estate portfolio stood at EUR 1.83 bn at end-June, down 12% on the EUR 2.13 bn value at end-December 2008 due to difficult economic conditions and a 'conservative valuation of projects put on hold'. Net asset value came to EUR 15 per share, down from EUR 42.5 mln at end-December.
Orco said it had implemented a restructuring plan which had led to major developments such as Vaci 1 in Budapest and Zlota 44 in Warsaw being put on hold pending the ourcome of negotiations on financing. 'This has had a dramatic effect on their valuation,' the company said.
Orco posted net losses of EUR 199.9 mln in the first half, impacted mainly by non-cash valuation adjustments on properties and developments to the tune of EUR 252.2 mln. The loan-to-value rate stood at 80% at end-June compared with 67% at end-December. This is above the long-term sustainable limit of 50% set by the board of directors.
The company boosted consolidated revenue by 16.8% to EUR 132 mln in the first half, reflecting increased sales in residential and commercial development. While no significant growth is anticipated in the markets where Orco is active until mid-2010, the company said the residential development market in Prague is still active while that in Warsaw is resilient despite lower prices and more restricted credit access.