Allreal with "solid half-year result
In view of the coronavirus crisis, which has affected both the letting of investment properties and the project business of the Projects & Development division, Allreal Holding is satisfied with the results for the first half of 2020.
Despite the challenges in the period under review, Allreal reported "another very solid performance". The rental of real estate and the activities of the Projects & Development division resulted in net income including revaluation effect of CHF 86.4 million (previous year: CHF 89.2 million). According to the information provided, a revaluation of the portfolio by CHF 27.7 million (previous year: CHF 30.2 million) had a significant impact on the result. The reason for the decline compared to the first half of 2019 was positive one-off tax effects, which amounted to CHF 3.0 million in the same period of the previous year.
The two divisions Real Estate and Projects & Development made a positive contribution to operating net profit of 63.0 million in the first half of 2020 (previous year: 67.4 million).
Rental income fell by 1.8 million to 100.1 million in the first half of the year. The company puts the loss of income due to rent deferrals for tenants affected by the lockdown at around 1.4 million. The cumulative vacancy rate fell from 2.2% at the end of 2019 to 1.5% in the first half of the year. The net yield on investment properties amounted to 4.1% after 4.4% in the previous year.
On the reporting date, the portfolio comprised 64 investment properties - 21 residential and 43 commercial properties - as well as two investment properties under construction. On the reporting date, the total value of the portfolio of 66 investment properties amounted to CHF 4.39 billion (31.12.2019: CHF 4.34 billion).
Decline in the Projects & Development division
The Projects & Development division generated income of 24.6 million in the first half of the year, which is 12.5% less than in the same period of the previous year (28.1 million). On the one hand, income from the realization of Projects & Development was lower than in the same period of the previous year, partly due to project postponements caused by the coronavirus crisis. On the other hand, income from sales development was significantly lower, according to Allreal.
However, the company emphasizes that demand for residential property remains excellent. At the Florenstrasse project in Winterthur (ZH), reservation agreements were concluded for 44 of the 51 condominiums on offer during the reporting period despite restrictions due to the lockdown.
Allreal remains optimistic for 2020 as a whole: due to lower profits from the sale of development properties and delays in individual projects, the company's operating result is likely to be below the record result of 2019, but will be higher than in the 2018 financial year. (ah)
