Allreal increases rental income
Including revaluation, the half-year result increased significantly. In particular, the Real Estate division reported lower vacancy rates, while the "Development and Realization" division recorded a lower volume of realizations.
Excluding the revaluation effect, Allreal generated earnings of CHF 60.5 million in the first half of the year. Allreal explains the decline compared to the same period of the previous year, when CHF 66.7 million was earned, in particular with the one-off effect of a property sale in the first half of 2023. Including revaluation, net profit rose from CHF 44.3 million to CHF 67.2 million. Following a devaluation of CHF 26.1 million in the prior-year period, the revaluation of properties was now positive at CHF 6.7 million. According to Allreal, this was due to a slightly higher valuation of commercial real estate overall. The discount and capitalization rates remained unchanged.
Rental income increases by 2.3%
In the Real Estate segment, rental income increased slightly by 2.3% to CHF 111.0 million. This more than compensated for the sale of several investment properties last year. The reasons for the growth in income were, on the one hand, the linking of commercial rents to inflation and the adjustment of the reference interest rate for residential rents. In addition, the completely modernized and fully let property at Bellerivestrasse 36 in Zurich once again contributed income throughout the reporting period. The cumulative vacancy rate fell from 1.7 to 1.5%. On balance, the operating result in the Real Estate segment fell from CHF 69.4 million to CHF 61.7 million due to higher financing costs and the aforementioned one-off effect.
Profitability of construction division to be increased
In the Development & Realization segment, Allreal increased income from business activity from CHF 17.6 million to CHF 21.3 million. This was mainly due to the higher contribution to income from the sale of condominiums, according to the statement. By contrast, the volume of projects completed in the Realization segment fell from CHF 143.0 million to CHF 118.5 million. Although the gross margin from third-party projects increased from 9.9TP3T to 13.4%, income from realizations was lower than in the previous year at CHF 10.5 million (H1 23: CHF 11.5 million). "In comparison, the business division generated lower income, which led to a lower contribution to profit from third-party fees and contract awards," writes Allreal. The volume of third-party projects is to be slightly increased again in future "in order to improve the profitability of the business division again over the next few years". At CHF 3.1 million, the segment's operating result was nevertheless better than in the same period of the previous year (CHF 0.0 million).
Allreal confirms its outlook for 2024 as a whole and continues to expect operating net profit to be slightly below the previous year. (aw)
