In connection with the ongoing optimization of its property portfolio, IMMOFINANZ Group sold the Valdek office building in Prague to a Danish investor at the end of September 2010.
The sale price exceeded the book value determined by external appraisals. Both parties have agreed not to release any information on the exact price for this transaction.
The Valdek office building is situated at a prime location on the Jugoslavska/Namesti Miru in Prague II (Vinohrady). It was built in 1938 and fully renovated in the late 1990s. The Valdek has more than 5,800 m² of space, which is let primarily to international companies such as major banks and insurance firms.
Recovery on the Czech property market
The Czech property market is concentrated in Prague and has recently shown stable development with a slight upward trend. This reflects the low volume of project completions. The economic crisis brought a clear differentiation between primary and secondary locations, which is expected to result in constant rents and a stable demand for office space up to the start of recovery in all segments of the market. Returns on top objects at prime locations are currently less than 7%.
Eduard Zehetner, CEO of the IMMOFINANZ Group, commented, "This transaction demonstrates that it is possible to sell properties at prices that exceed book value and, in turn, confirms the NAV. The Valdek was sold for strategic reasons related to the portfolio optimization because it is smaller than the minimum size defined by our corporate guidelines."
Source: ACCEDO Austria GmbH