Peach Property announces operating record
Due to currency effects, Peach Property Group will close 2022 with a loss. However, FFO I of EUR 18 to 19 million is "the best operating result in the company's history".
According to preliminary figures, the Zurich-based investor, which specializes primarily in German rental apartments, increased FFO I by around 70% year-on-year and explains this with the integration of portfolio acquisitions from previous years as well as higher efficiency in management. The operating figure is at the lower end of the forecast, which had been confirmed in the summer, but significantly above the approximately 16 million euros, to which Peach lowered the forecast in December. The company had justified this step with "increased maintenance, operating and financing costs".
Peach attributes the fact that rental income rose significantly to CHF 116 million and is at the upper end of the forecast to strong new leasing business and the accelerated rise in market rents. The like-for-like rental growth amounts to around 5%.
Loss of 20 million euros expected
Earnings before taxes excluding foreign exchange losses were "slightly positive. However, currency losses are expected to push it down to around -20 million euros, the report continues.
Devaluations in the second half of the year
The total market value of the portfolio was virtually unchanged at EUR 2.6 billion at year-end 2022. Following revaluations in the first half of 2022, a decline in valuation in the second half of the year resulted in a net devaluation of around EUR 13 million in the reporting year.
Start of construction on Lake Zurich
Peach reports significant progress for its Swiss development project "Peninsula Wädenswil". Following the start of demolition work in the second quarter of 2022, the official groundbreaking ceremony for the project on Lake Zurich took place in December. Since notarizations began in July 2022, around 60% of the total 56 planned residential units worth around CHF 77 million have already been sold or reserved, he said.
2023 expected to be marked by rising rents
For the current financial year 2023, Peach Property Group expects a positive operating development and justifies this primarily with the noticeable decline in new construction activities in Germany as a result of the sharp rise in construction and financing costs. For this reason, further increases in market rents are to be expected, according to Peach. (aw)
