Novavest Real Estate with significant jump in profits
Novavest Real Estate AG reports significant growth for the 2017 financial year. Profit including revaluation gains amounted to 12.3 million, which is more than double the previous year's figure of 5.8 million.
According to Novavest Real Estate, profit excluding revaluation gains amounted to 8.4 million (previous year: 3.7 million), an increase of 130 percent.
Eight properties with a total value of CHF 127.6 million were acquired in the reporting period, and the total value of the real estate portfolio increased by 45% to CHF 458 million as at the balance sheet date (December 31, 2017) (31.12.2016: CHF 315.7 million).
Target rental income from investment properties increased by 47% to 22.2 million per annum after 15.1 million in the previous year. The share of rental income from residential use amounted to 53%.
Net rental income even increased by 65% to 17.5 million in the reporting year (previous year: 10.6 million). The net yield generated on the investment properties amounted to 4.0% (previous year: 3.5%). The vacancy rate for the overall portfolio (excluding conversion projects) fell from 10.3% to 8.7%. According to Novavest, first-time lettings and re-lettings as well as the acquisition of the properties in Frauenfeld (Schaffhauserstrasse 17, 19) and Murten (Centre Loewenberg), which are fully let, were the main contributory factors.
At 2.1 million, direct expenses for rented investment properties remained almost unchanged from the previous year (2.0 million). Measured against net rental income, direct expenses for rented investment properties amounted to 11.8% (previous year: 19.3%).
Income from revaluation amounted to 5.2 million after 3.7 million in the previous year. This was due to higher valuations of various investment properties by Wüest Partner.
EBIT almost doubled
Earnings before interest and taxes (EBIT) amounted to 17.3 million and almost doubled compared to the previous year (8.9 million) with an increase of 95%.
At the Annual General Meeting on March 28, 2018, the Board of Directors will once again propose a cash distribution in the form of a par value reduction, this year in the amount of CHF 1.40 per registered share.
In the current year, Novavest intends to optimize its property portfolio and - where possible - expand it through the acquisition of existing properties or new construction projects. According to the company, the planning work for a new conversion project at Badenerstrasse 701 in Zurich (conversion of a commercial property into a residential property) will continue until the end of the first quarter of 2018, after which the construction phase is scheduled for 2018/2019 and re-letting from fall 2019. The conversion project in Olten should be completed by the end of 2018.