IMMOFINANZ CEO Oliver Schumy was a guest at the Tuesday evening Q-Check road show organised by “Der Börsianer“, where editor-in-chief Dominik Hojas examined the investment stories of IMMOFINANZ and the oil field equipment supplier SBO. The common factors between these two companies include high free float, relatively high cash balances, substantial share price declines in recent weeks and strong external issues that currently impact the business – keyword Russia and the oil price.
Here a summary of the most important points:
CEO Schumy discussed the recent strong concentration and optimisation process in the IMMOFINANZ portfolio. The latest step was the sale of the logistics properties. In this asset class, major players have changed the market fundamentally in past years and compiled very large portfolios. These changes would have made it impossible for IMMOFINANZ to gain a leading position in the logistics segment of its core region. The entire logistics portfolio was therefore sold to Blackstone for a transaction value of approx. EUR 500 million. The closing is scheduled to take place shortly and will lead to net cash inflows of more than EUR 300 million, explained Schumy.
This transaction will allow IMMOFINANZ to concentrate fully on the retail and office asset classes. Plans for the retail business include, among others, expansion with the STOP.SHOP. retail park chain, which is generating high returns (approx. 8%) and has been well received by the market.
With regard to the legal proceedings initiated by investors, Schumy said: “The acceptance rate is now so high that we can essentially consider this issue as solved.“ The first payments have already been made. In addition, the commercial court has set a settlement date in February for the arrangement concluded with Advofin, which covers more than 3,000 investors. Payments here will also begin after that date.
Referring to Russia, Schumy discusses the temporary rental price reductions and fixed exchange rates for the tenants in the five Moscow shopping centers. IMMOFINANZ has also entered into a partnership with ECE, the European market leader in the shopping center segment, for the management, rental and marketing of its largest shopping center, the Golden Babylon Rostokino. “We expect this will result in a number of positive effects“, added Schumy. Additionally, a difficult market phase like the current one can also be used to reduce costs.
When asked about the mood on the stock exchange and possible triggers for the share price, the CEO pointed to Russia and the recovery of the Russian market. “This subject will remain a determining factor in media reports for the time-being“. Another important issue is an increase in the occupancy rate of IMMOFINANZ’s office properties: this rate should rise to 80%+ by the end of April 2016, which would top the level at the end of October 2015 by five percentage points.
In the project area, IMMOFINANZ recently reported the successful conclusion of two leases in Düsseldorf: We will be building the new corporate headquarters for trivago and the E.ON subsidiary Uniper. “These leases are two of the largest leasing agreements ever concluded by IMMOFINANZ.“
In answer to a question on distributions, Schumy referred to the pending registration of the capital measures which were approved by the annual general meeting on 1 December 2015 and are intended to form the basis for sustainable dividends. These measures should be recorded in the company register shortly, and IMMOFINANZ will then present the details of its distribution policy.