Real estate group DEMIRE AG to continue expansion in 2015
DEMIRE Deutsche Mittelstand Real Estate AG / Key word(s): Quarter Results/Real Estate
Real estate group DEMIRE AG to continue expansion in 2015
Frankfurt/Main, June 17, 2015 - In the first quarter of 2015, DEMIRE Deutsche Mittelstand Real Estate AG ("DEMIRE", ISIN DE000A0XFSF0) generated earnings before interest and taxes (EBIT) of EUR 5.2 million after EUR 0.7 million in the previous year's comparable quarter. This strong increase was the result of higher rental income due to the expansion of the commercial real estate portfolio to around 400,000 m² as of the March 31, 2015, reporting date. Rental income amounted to EUR 8.8 million in the first quarter of 2015 compared to EUR 0.4 million in the comparable quarter of the prior year. In line with the portfolio's expansion, operating expenses grew from EUR 0.1 million to EUR 3.6 million. As a result of the growth in the commercial real estate portfolio, DEMIRE real estate group's total assets increased 14% to EUR 426.1 million. Total assets mainly reflect investment properties held in non-current assets amounting to EUR 371.1 million (December 31, 2014: EUR 333.1 million).
The Frankfurt/Main based real estate group also continued with the expansion of its commercial real estate portfolio in 2015. DEMIRE AG had completed three promising transactions by May 2015. These transactions increased overall rental space of its commercial real estate portfolio by around 210,000 m² to more than 610,000 m² and raised the annual net rent excluding utilities to roughly EUR 32.8 million. Already by mid-year, DEMIRE AG had made significant progress on its way to becoming a leading holder in the market for commercial real estate in Germany. Further substantial real estate purchases are in preparation. Overall, the real estate group is confident that it will be able to almost double its portfolio volume in Germany during the current year. The Company has financing available to accomplish this growth in the form of capital increases against contribution in cash and in kind, the issue of bonds as well as the assumption of other types of debt.
DEMIRE AG acquired a further building complex in Schwerin in addition to the real estate acquired during the year 2014. The office and commercial building with around 5,240 m² of rental space has long-term rental agreements in place on a sustained basis. In Leipzig, the real estate group acquired two properties by means of a capital increase in kind. One of these acquisitions was the Gutenberg-Galerie office and retail property. This centrally located property offers more than 20,000 m² in rental space of which 60% is used as office space and 40% is used as retail space and for a four-star hotel. DEMIRE was also successful in a bidding process for a former logistics complex belonging to Quelle. This logistics property, which is located about 10 km north of Leipzig's city centre, has total rentable space of about 184,000 m² on property of approximately 330,000 m². The logistics property consists of around 164,000 m² of warehouse space, almost 20,000 m² of office space, and a good 35,000 m² of surrounding area as well as two areas for expansion totalling about 38,000 m² that already have building rights. Based on its excellent location near the trade fair centre and the BMW plant and due to the high demand for logistics properties in Leipzig, DEMIRE expects the complex to offer substantial development potential by means of reducing vacancies, rent adjustments and expansion of floor space.
The commercial real estate specialist has also strengthened itself in the current fiscal year through purchasing interests or by acquiring companies in the areas of asset, property and facility management and can now demonstrate in-house, active portfolio management. This has resulted in a rise in staff to 22 employees (December 31, 2014: 8).
The holdings of German commercial real estate will make its first full 12 month contribution to rental income during the current fiscal year, visibly affecting and strengthening the Group's revenues. These holdings are also expected to lead to positive cash flow from operating activities. In 2015, the active asset, property and facility management is expected to lead to increasing occupancy rates and lower ongoing operating costs and generate a lasting rise in the value of real estate holdings.
The first quarter 2015 interim announcement is available on the Company's website under www.demire.ag.
The Executive Board
About DEMIRE Deutsche Mittelstand Real Estate
Leading holder of commercial real estate
DEMIRE Deutsche Mittelstand Real Estate AG is transforming itself into a leading holder of German commercial real estate. The core business activities of the Frankfurt/Main headquartered real estate group consist of the acquisition, the management and the rental of commercial real estate and their further development, for example, through modification, modernisation or expansion, and increasing their value through active portfolio management.
The commercial property portfolio consists of more than 610,000 m2 of rentable space as of May 31, 2015, mainly comprising of office and logistics properties. Annualised net rent excluding utilities amounts to approximately EUR 32.8 million. The portfolio's regional focus lies in Bavaria, North Rhine-Westphalia, Baden-Württemberg and Saxony. The in-house asset, property, and facility management ensures the optimum management and development of the holdings
The DEMIRE real estate group pursues a buy-and-hold-strategy combined with active portfolio management. It is concentrated on both the value-added and core-plus investment approaches. The combination of these two approaches offers a balanced risk-return ratio and attractive opportunities.
The real estate group's lean structure allows it to take action quickly and flexibly. The shares of DEMIRE Deutsche Mittelstand Real Estate AG (ISIN DE000A0XFSF0) are listed in the regulated market (General Standard Segment) of the Frankfurt Stock Exchange.
DEMIRE Deutsche Mittelstand Real Estate AG
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|Company:||DEMIRE Deutsche Mittelstand Real Estate AG|
|Lyoner Straße 32|
|60528 Frankfurt am Main|
|Phone:||+49 (0)69 / 719 189 79 0|
|Fax:||+49 (0)69 / 719 189 79 11|
|Listed:||Regulated Market in Frankfurt (General Standard); Regulated Unofficial Market in Berlin, Stuttgart|
|End of News||DGAP News-Service|