Austrian listed property company Sparkassen Immobilien saw the value of its property portfolio lose some EUR 100 mln in the first nine months of the year as valuations were 'massively' impacted by the international economic and financial crisis. Total writedowns for the period rose to EUR 96.5 mln, from EUR 1 mln a year before. Sparkassen said that around 98% of the writedowns were attributable to its Central and South Eastern European portfolio.
Austrian listed property company Sparkassen Immobilien saw the value of its property portfolio lose some EUR 100 mln in the first nine months of the year as valuations were 'massively' impacted by the international economic and financial crisis. Total writedowns for the period rose to EUR 96.5 mln, from EUR 1 mln a year before. Sparkassen said that around 98% of the writedowns were attributable to its Central and South Eastern European portfolio.
'The continuing disappointing performance of our markets - in particular the higher yields expected by investors from property investments in Eastern Europe and the consequent decline in property valuations - meant that valuations had to be revised downwards, resulting in an accounting loss,' said Holger Schmidtmayr, member of Sparkassen Immobilien's management board.
The company swung to a loss of nearly EUR 72 mln in the first nine months of the year, from a profit of EUR 12 mln in the same period a year before. However, it reported record operating cash flows of EUR 48 mln during the first nine months, an increase of 17% compared to EUR 41.3 mln for the same period last year. Revenues for the first three quarters came to EUR 86 mln, compared with EUR 81.5 mln in 2008. Of this, roughly EUR 67 mln was rental income.
The Vienna-based group said that all its development projects are progressing on schedule, with the group investing a total of EUR 150 mln in its development pipeline so far this year. 'When the projects are completed our rental income will grow significantly, and our cash flow will be doubled,' said Sparkassen's Friedrich Wachernig. Sparkassen, with operations in Austria, Germany, the Czech Republic, Slovakia, Croatia, Hungary, Romania and Bulgaria, recently opened the Neutor 1010 building in Vienna and the Austria Trend Vysoka Hotel in Bratislava, while its Serdika Center shopping centre in Sofia and the Sun Plaza mall in Bucharest are scheduled to open in early 2010. Both have pre-letting ratios of roughly 90%.
Sparkassen's property portfolio is currently worth some EUR 1.8 bn and consists of 260 properties with total lettable space of 1,515,100 m2. The assets, with an occupancy rate of 90.2%, generate a gross rental yield of around 6.7%.
