alstria office REIT-AG: Revenues and FFO in line with company guidance

alstria office REIT-AG successfully managed to strengthen the balance sheet and to keep revenues and funds from operations (FFO) in line with the guidance in 2009. By selectively refinancing and selling assets the company kept the Loan-to-Value Ratio (LTV) of the syndicated loan close but below 60%, while reducing the balloon payment from €1.1 billion to €651 million.

"Through our strong focus on operations, selective sales and refinancing alstria was able to successfully navigate through a very challenging environment in 2009," comments Olivier Elamine, Chief Executive Officer of alstria. "We have today one of the strongest balance sheets in the German real estate industry, with more than €50 million of free cash that we could deploy rapidly if we would identify attractive opportunities in the market," adds Alexander Dexne, Chief Financial Officer of alstria.

Revenue development, funds from operations and net income
Revenues and funds from operations (FFO) in the 2009 financial year were in line with the company's full year guidance: Revenues amounted to €102.5 million (2008: €102.1 million). Net rental income in 2009 totalled about €92 million (2008: €93.2 million). As expected the FFO which came in at €32.7 million (2008: €39.4 million) was impacted by higher financial costs, as well as an acceleration in asset management activities.

The consolidated loss amounted to €79.7 million (2008: consolidated loss of €56 million), or €1.44 per share. This loss is attributable primarily to a non-cash devaluation of the real estate portfolio (€86 million), as well as devaluation and termination of interest rate hedges (€23 million).

Financial and asset position
At year-end 2009, alstria's portfolio was valued at €1.6 billion, which reflects a valuation yield of 6.2% (5.9% in 2008). Net asset value (NAV) decreased year on year by approx. 13.1% to €634 million. This decrease was mainly driven by the non-cash devaluation of investment properties and the impact of the mark-to-market of hedge instruments. The NAV per share stood at €11.32 down from €13.03 in 2008.

alstria was in line with all its debt covenants at year-end with an LTV on its main credit facility at 59.8% versus a covenant at 65%.

Dividend for 2009
For the financial year 2009, the management board will propose to the Annual General Meeting a dividend of €0.50 per share.

Operational achievements
In one of the most challenging investment markets on record, alstria was able to dispose €141 million of assets in line with the 2008 year end valuation. Despite this strong disposal track record, and evidence of the high quality of alstria's portfolio, alstria had to book a non-cash portfolio valuation loss of €86 million. This devaluation was mainly driven by writedown on assets which are larger than €50 million, and/or with lease maturities which are shorter than 10 years. 19 assets representing 25% of the portfolio in terms of asset numbers have caused more than 80% of the total devaluation.