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ADO Properties presents strong key operating figures for H1 2019

ADO Properties S.A. has presented strong key operating figures for the first half of the fiscal year 2019. The income from rental activities of ADO Properties rose in the first half of 2019 by 9.9% to €71.4 million (H1 2018: €64.9 million) mainly driven by new acquisitions and the stable 4.0% like-for-like rental growth. The EBITDA from rental activities increased by 2.4% from €46.7 million in the first six months 2018 to €47.9 million in the same period in 2019. The second quarter 2019 results represent an annualized EBITDA of almost EUR 96 million.

At €33.4 million, the FFO1 (from rental activities) was almost at the previous year’s level, equivalent to an FFO1 of €0.76 per share.

The average in-place rent of the residential portfolio rose to €6.81 per sqm per month at the end of the second quarter 2019 (31 December 2018: €6.73). The vacancy rate for the residential portfolio decreased to 2.9% as of 30 June 2019 (31 December 2018: 3.2%) due to increased speed of unit modernization.

ADO Properties’ portfolio value has grown by €282.2 million to €4,375 million as of 30 June 2019. It comprised 23,627 units at the end of the reporting period, of which 22,169 are residential units (31 December 2018: 22,202 units). During the first six months 2019, ADO Properties sold 38 units. The average sales price of €3,866 per m² compares very positively to the company’s current average portfolio value for Central Locations of €3,246 per m² which is most comparable. The EPRA Net Asset Value of the portfolio amounted to €2.68 million, or €60.63 per share, as of 30 June 2019.

ADO Properties’ financial structure remained stable and conservative with an LTV of 38.0% at the end of the reporting period and an average interest rate on all outstanding long-term debts of 1.6%. The weighted average maturity of the outstanding debts is approximately 4.3 years. Almost all loans have fixed interest rates or are hedged. ADO Properties will continue to adhere to its conservative financing strategy and its LTV target of a maximum 40%.

Expected FFO 1 run rate in 2019 approximately €65 million and positive outlook
“The current political situation has led to a considerable amount of unrest in the real estate sector. We view the proposed ‘Berliner Mietendeckel’ quite skeptically and we believe that it or something similar can only contribute to a further shortage of apartments in Berlin. However, this should please investors, who in the long term almost certainly stand to benefit from such conditions. The short-term situation can only be described as uncertain because nobody can say with any degree of confidence which political decisions will be taken or what effect they will have on the real estate sector. But despite all this, our overall outlook for the coming months remains positive”, says Ran Laufer, CEO of ADO Properties. “In view of the positive development during the first half of the year, we still expect our FFO 1 run rate for 2019 as a whole to be around €65 million. Given the uncertainties regarding whether and in what form the proposed rental law in Berlin will be adopted, we are currently not providing guidance on our anticipated like-for-like rental growth, but we are confident that ADO Properties will continue to increase in the medium to long-term the value of its assets, its NAV and its NAV per share. Our quality portfolio and fully integrated, scalable management platform provides us with the operative flexibility to enable us to initiate and execute appropriate action. We can adapt our operative strategy at short notice to tailor for any events.“