Peach Property makes loss in 2022 despite record result

Peach Property Group AG, specializing in rental apartments in Germany, closed the 2022 financial year with the highest operating income in the company's history. At EUR 19.2 million, funds from operations (FFO I) were EUR 90% higher than in the previous year.

Rental income increases

Rental income increased by 16% or 5.1% on a like-for-like basis, reaching 116.5 million euros. Peach sees further growth potential, as the average rent per square meter of the properties, at just under 6 euros/sqm, is around 18% below the market average.

The real estate portfolio of 27,550 residential units was valued at 2.6 billion euros at the end of 2022. Devaluations in the volume of 12 million euros had been offset by investments in modernization measures and an additional purchase, Peach said.

Foreign exchange losses depress earnings

Peach recorded book losses of 30 million euros as a result of the weakening of the euro against the Swiss franc. As a result, earnings after taxes fell to -15 million euros, compared with 186.1 million euros in the previous year. EBIT fell from 315 million euros to 43.7 million euros.

For the 2023 financial year, Peach expects net rental income to increase from EUR 121 million to EUR 123 million, corresponding to like-for-like growth of an expected 4%. Operating profit (FFO I) will be in a range between EUR21 million and EUR23 million, the company says.

Laying of the foundation stone for residential project on Lake Zurich

While Peach is investing primarily in affordable rental apartments in Germany, the company is creating high-quality residential property in Switzerland with the "Peninsula Wädenswil" development project: the foundation stone for 57 high-quality residential units on the shores of Lake Zurich was laid in December, the company said. Even before ground was broken, 60% of the apartments had been sold or reserved, it said. The market value is CHF138 million, it said, with completion scheduled for early 2025. (ah)