Lar Espana Real Estate (LRE), the listed real estate investment company, doubled its profits in 2016. It registered a profit of €91.4m, an increase of 110%, compared to the €43.6m booked in 2015.
The 2016 profit was largely down to the strong performance of property rental income, that reached €60.2m, 69% more than the €35.7m in 2015. The improved management of the assets and the increase in size of the SOCIMI's portfolio in 2016 are two of the reasons behind this notable increase in income.
The distribution of Lar Espana's income by autonomous region demonstrates the geographical diversity of the SOCIMI's property portfolio: 23% of income in 2016 related to assets in the Basque Country, followed by Castilla-La Mancha with 14%, the Community of Valencia with 13%, Galicia with 13%, Castilla y León with 12%, Catalonia with 11% and Madrid with 11%.
The active management of the SOCIMI's portfolio of 29 assets allowed it to reach a value of €1,275m at the end of 2016, raising their acquisition price by 16%, a percentage which stood at 9.3% at the end of H1 2016. By asset class, shopping centres achieved a value uplift of 13.5%, logistics assets 20.7%, offices 21.7% and the residential asset the company owns increased in value by 31.2%. In terms of portfolio growth, the largest deals in 2016 were the acquisition of the Gran Vía de Vigo shopping centre for EUR 141 million and the Vistahermosa shopping centre for €42.5m.
The occupancy rate of Lar Espana's assets stood at 93.5% in 2016 and the portfolio reached a combined total of 708,000 m² of which 68% relates to shopping centres, 22% to logistics assets, 7% to offices and the remaining 3% to one residential asset.
José Luis del Valle, Chairman of Lar Espana, indicated that "the excellent results achieved in 2016 confirm that we are on the right track. We have achieved a net profit of €91m, more than doubling the 2015’s figure, and our property portfolio has increased in value by 16%. This excellent financial stability allows us to comfortably meet our shareholders’ expectations, who this year will receive a €30m in dividends as we had agreed."
Lar Espana doubles its profits in 2016, reaching €91.4m
- The acquisitions made and the improved management of the assets allowed income to increase to €60.2m, 69% more than in 2015
- The value of the portfolio increased by 16% and now stands at €1,275m
- The SOCIMI's shopping centres increased sales by 8.8% in 2016 and welcomed 53 million visitors, 5.7% more than the previous year
- In its next AGM, Lar Espana will propose a dividend distribution totalling €30m, €0.33 per share, 65% more than in 2015
