DGAP-News: TLG IMMOBILIEN AG / Key word(s): Real Estate/Preliminary Results
TLG IMMOBILIEN announces significant property portfolio valuation uplift - Total value to exceed EUR 4 bn
- Valuation uplift between EUR 370 m and EUR 400 m in the second half of 2018
- Total property portfolio value to exceed EUR 4 bn as of the effective date 31 December 2018
- Berlin portfolio as key contributor accounting for approx. 80 % of revaluation
- Active asset management generating excellent results
- Positive impact on adjusted EPRA NAV and Net LTV
In the first half of 2018 the value of the property portfolio had increased by 7.8% to EUR 3.67 bn as of 30 June 2018 which was primarily driven by revaluations and acquisitions. In the second half of 2018 a market value uplift between EUR 370 m and EUR 400 m compared to the market value as of 30 June 2018 (excluding acquisitions and sales within the second half year 2018) is now expected. Taking into account acquisitions and sales of the second half year 2018, the total value of the property portfolio as of 31 December 2018 is expected to reach approx. EUR 4.1 bn. On the basis of the adjusted EPRA Net Asset Value (adjusted EPRA NAV) per share as of 30 September 2018 in an amount of EUR 22.46, the pro-forma adjusted EPRA NAV per share will reach approx. EUR 25.80 to EUR 26.10. The total property portfolio value of TLG IMMOBILIEN will be valued at 18.1-times of the annualised in-place rent of EUR 226 m or an in-place rental yield of 5.5 %. The valuation corresponds to an in-place office rental yield of 4.7% and an in-place retail rental yield of 6.6%.
In the valuation, the Company benefits from its property portfolio which is located in strong growth markets like Berlin, the Rhine-Main region, Dresden and Leipzig and thus benefits from the prevailing strong demand and limited supply of office properties. This results in a persistent increase of market rents as well as yield compression. TLG IMMOBILIEN's active asset management is able to benefit from those market opportunities and can create significant value while adhering to its focus on the letting result. Examples are the two secured major lease agreements in Dresden (lease agreement for around 18,000 sqm of office space with the city of Dresden) and Berlin (new lease agreement for around 15,000 sqm of office space in Berlin) that have already been communicated earlier this year but also smaller new or re-lettings within the total portfolio.
In the future TLG IMMOBILIEN plans to invest even more to improve the quality of its existing properties. The Company is currently in the process of assessing the potential of all existing land and buildings for development and redevelopment in order to realise value. This can include adding new storeys to a retail property for office usage, for instance in Berlin. In addition, it also comprises large-scale projects such as plans to expand the Alexanderplatz property in Berlin, which was already announced in mid-October 2018. The Company sees the potential for around 100,000 sqm of additional lettable space in this single property on one of the most famous and most sought-after squares in Germany. These still to be realized additional value upsides of the portfolio are only to very small extent reflected in the valuation results.
The majority of the revaluations in the second half of 2018 of approx. EUR 250 m relate to the office asset class and Berlin in particular. However, regions like Rhine-Main, Dresden or Leipzig are showing positive developments as well and also contributed to the revaluation.
"We will apply a portfolio valuation by the end of the year which is in line with current very good market conditions. Besides the increase of the EPRA NAV per share to approx. EUR 26, the revaluation will also result in a decrease of the Net LTV to approx. 35 % which will provide further financing headroom", says Gerald Klinck, CFO of TLG IMMOBILIEN.
"In the future we want to continue to realize in the potential of the existing property portfolio with our active asset management to realize additional values and promote the successful development of the Company", Jürgen Overath, COO of TLG IMMOBILIEN, adds. "We currently assess all existing buildings and land plots for development potential and plan to realize those inherent upsides in the future. We also want to continue making acquisitions designed to increase value and disposing of non-strategic properties."
Friday, 14 December 2018
ABOUT TLG IMMOBILIEN AG
TLG IMMOBILIEN AG is a listed leading commercial real estate company in Germany that has been synonymous with real estate expertise for over 25 years. TLG IMMOBILIEN AG generates stable rental income and exhibits low vacancy rates, very good building stock and profits from its local employees' excellent market knowledge. As an active portfolio manager, TLG IMMOBILIEN AG is specialised in commercial properties for office and retail use: it focuses on managing a high-quality portfolio mostly comprising office properties in Berlin, Frankfurt/Main, Dresden, Leipzig and Rostock. The company also has a regionally diversified portfolio of retail properties in highly frequented micro-locations. The portfolio also includes seven hotels in Berlin, Dresden, Leipzig and Rostock. TLG IMMOBILIEN AG's properties stand out not only due to their excellent locations but also because of their long-term rental or lease agreements.
As at 30 September 2018, the property value amounted to EUR 3.7 bn. As at the same reporting date, the EPRA Net Asset Value per share amounted to EUR 23.58.
This publication contains forward-looking statements based on current views and assumptions of TLG IMMOBILIEN AG's management and made to the best of knowledge. Forward-looking statements are subject to known and unknown risks, uncertainties and other factors that could cause TLG IMMOBILIEN AG's revenues, profitability or the degree to which it performs or achieves its targets, to materially deviate from what is explicitly or implicitly stated or described in this publication. Therefore, persons who obtain possession of this publication should not rely on such forward-looking statements. TLG IMMOBILIEN AG accepts no guarantee or responsibility regarding such forward-looking statements and will not adjust them to future results or developments.
|Company:||TLG IMMOBILIEN AG|
|Phone:||030 - 2470 - 50|
|Fax:||030 - 2470 - 7337|
|Listed:||Regulated Market in Frankfurt (Prime Standard); Regulated Unofficial Market in Berlin, Dusseldorf, Hamburg, Hanover, Stuttgart, Tradegate Exchange|
|End of News||DGAP News Service|