Overall real estate investment markets were stable in the second quarter of 2010, however, real estate rental markets were still somewhat mixed. Nonetheless, IVG was able to achieve sound letting results thanks to its intensive efforts in Asset Management.
In the first half of 2010 we concluded new leases or prolonged existing ones for 153,674 m² in our own portfolio (Real Estate segment) and for 141,657 m² in properties managed by our segment IVG Funds. Therefore the occupancy rate for our own portfolio remained nearly unchanged at 90.2%. The NOI yield of properties in IVG's own portfolio remained stable at 5.0%. The NRI yield amounted at 5.4%.
IVG's operational result (EBIT) reached 84.4 million in Q2 2010 (Q1 2010: 71.9 million) and again increased compared to the first quarter of 2010. Negative unrealized changes in market values of -22.2 million (Q1 2010: - 26.2 million) in the Real Estate Segment and -13.6 million (Q1 2010: 4.6 million) unrealized changes in value in the Development Segment were more than offset by positive unrealized changes in market values of 36.0 million in the Caverns Segment (Q1 2010: 34.0 million).
The increase in revenues by 236.9 million from 148.9 million in the first quarter 2010 to 412.8 million in the second quarter 2010 was mainly due to the proceeds from project sales in the Development Segment (303.9 million) and a promote structure in the Segment Caverns (8.9 million). The Financial Result amounted to -64.4 million, so that IVG was able to report a positive Consolidated Net Profit of 18.0 million for the second time in a row.
The financial figures Funds from Operations, FFO I (3.9 million) and FFO II (22.5 million), also remained in positive territory during Q210. IVG's Net Asset Value per share amounted to 6.88 as of June 30, 2010, which was slightly above the level at the end of the first quarter 2010 and therefore for the first time in 9 quarters showed a positive q-o-q development.
The Net Asset Value adjusted including the future cavern business amounted to 9.59 per share at the end of the first half-year 2010. IVG´s loan-to-value ratio (Bankers Definition) remained virtually stable at approx. 69%.
At the beginning of July 2010 we launched the repositioning of our biggest development project at the airport in Frankfurt am Main with the change of the name from Airrail to 'THE SQUAIRE'. The building will gradually start opening from October 2010 onwards and still shows a pre-letting rate of approx. 60%.
Gerhard Niesslein, CEO of IVG Immobilien AG, commented: "The once again positive result in Q2 2010 is encouraging and shows that IVG is on the right path. However, this result cannot be extrapolated over the year as a whole on straight-line basis as markets are still characterized by uncertainty.
"Nonetheless, we stick to our forecast for a positive consolidated net profit for the year as a whole. In the second half of 2010, IVG will systematically continue on the path it has taken by further improving its cost position and processes and by generating growth with its business model of an integrated investment platform and the co-investment approach."
Source: IVG Immobilien AG
