Realia sees loss widen to EUR 54m in 2009

Spanish property company Realia said its net loss increased by 18% to EUR 54 mln in 2009, mostly as a result of hefty writedowns in its property protfolio. Realia, which is controlled by construction group FCC and Spanish lender Caja Madrid, saw the value of its portfolio shed nearly 12% to EUR 4.5 bn at the end of 2009, according to the latest valuation carried out by CB Richard Ellis. The development portfolio was the most affected, with a decrease in value of 42%, due to the postponement of a number of projects.

As part of its strategy to re-focus on income-generating properties, Realia said that it boosted its rental income portfolio to a value of EUR 2.9 bn, representing 64% of its total assets. 'Since the onset of the crisis, Realia has carried out a restructuring programme including cost reductions of 26% and the postponement of a number of development projects until demand starts picking up again,' the company said in a statement on Monday to the Spanish stock market regulator CNMV.

Net financial debt amounted to EUR 2.2 bn at the end of 2009, reflecting a loan to value ratio of 49%. The company said it is going forward with plans to develop a 50,000 m² shopping centre in Santiago de Compostela and three projects in Paris, representing an investment of EUR 94 mln. The projects are to be built by its French subsidiary, Siic de Paris.

Additionally, Realia is in negotiations to sell an office building in Barcelona's central business district. The building was the former head office of Caja Madrid and currently houses the headquarters of PriceWaterhouseCoopers in the Spanish city. It offers 28,500 m² of office space and 417 parking spaces. CBRE is advising the company on the sale, which could fetch up to EUR 160 mln.