On June 24, 2009, Leasinvest Immo Lux, a 100% subsidiary of Leasinvest Real Estate, sold the entirely renovated and extended the 'Bian' office building. Thanks to this sale, Leasinvest Real Estate has realized a consolidated global net capital gain of €15.2 million in the first half year 2009.
The decrease of the value of the real estate portfolio can be explained by, on the one hand, the sale of the Bian office building in Luxembourg, and on the other hand, by the negative changes in the value of the portfolio. Because of the general economical and financial crisis the valuation of the real estate portfolio by the independent real estate expert has decreased compared to 31/12/08 due to, a.o., the increase of the market capitalization rates ('yields').
The average rental yield of the real estate portfolio of Leasinvest Real Estate has increased from 7.27% to 7.50% in terms of fair value and from 7.09% to 7.31% in terms of investment value.
The real estate portfolio in operation consists of 55 buildings, of which 41 buildings are situated in Belgium with a total surface of 261,135 m², and 14 buildings in the Grand Duchy of Luxembourg with a total surface of 84,201 m².
Leasinvest Real Estate has the following ongoing development projects: the new Montimmo office building in Luxembourg, the construction of a new branch for Cegelec SA on the business park 'Alpha Campus' in Zwijndrecht (Antwerp) and the renovation of the 'Torenhof' castle farm, part of the Axxes Business Park in Merelbeke (Ghent).
The rental income (19.5 million) recorded an increase of 20% compared to 30/06/08 (16.3 million), mainly due to the acquisition at the end of 2008 of retail sites in Luxembourg. Based on unchanged portfolio the rental income rose by 6% thanks to the indexing of the rents and newly-concluded rental contracts. The occupancy rate reaches 97.67% (30/06/08: 97.29%).
The decrease of the maintenance costs and the lower vacancy costs have led to a diminution of the real estate charges from 2.7 million on 30/06/08 to 2.2 million on 30/06/09.
The result on the disposal of investment properties (15.2 million, or 3.8 per share) comprises the realized capital gain on the sale of the Bian office building in Luxembourg at the end of June 2009.
As a consequence of the general trend on the national and international real estate markets a slight decrease on the valuation of the real estate portfolio was recorded by the external real estate expert. Thanks to the quality and diversified portfolio of Leasinvest Real Estate this decrease was limited to 2.1%.
The unrealized loss of 12 million (recorded under the item changes in the fair value of the investment properties), has to be compared to an unrealized gain of 11.2 million a year before (coming from the 'CFM' redevelopment project in Luxembourg (14.4 million)).
Due to the decreasing market interest rates the fair value of the non effective hedges (according to IAS 39) produced a negative change of 1.1 million compared to a positive change of 2.5 million on 30/06/08. Without taking into account the impact of IAS 39 the financial result decreased from -4.3 million (30/06/08) to -5.7 million, explained by the increased debt position compared to 30/06/08.
The net result, group share, ended at 12.8 million (or 3.2 per share) compared to 21.3 million (or 5.3 per share) the previous year, which was mainly due to a decrease of the portfolio results.
The net current result, group share, or the net result excluding the portfolio result and the changes in the fair value of the non effective financial instruments, on the other hand, rose by 25% from 8.0 million, or 1.99 per share on 30/06/08 to 10.7 million, or 2.67 per share on 30/06/09.
As of 01/01/09 the development projects are recorded at fair value under the item investment properties, according to the modified IFRS standard 'IAS 40', together with the buildings in operation.
The decrease of the investment properties is the consequence of the negative changes in the valuation