Last week we stopped by in Linz at the invitation of Bankhaus Spängler. This private bank had organised a breakfast meeting for investors, where our CFO Stefan Schönauer introduced IMMOFINANZ and presented the latest quarterly results, which show a clear improvement in key indicators. After that, we were available to answer questions.Following a restructuring phase that covered several years and was completed with the sale of the Russian portfolio at the end of 2017, the company now has a solid foundation for further growth. This growth will take place through IMMOFINANZ’s own development projects as well as the acquisition of smaller portfolios.
The two major office projects in Düsseldorf with nearly 60,000 sqm of space in total – the global headquarters for trivago and FLOAT, which will serve as the headquarters for the Uniper Group – will soon be finished. We are also regularly evaluating further portfolio acquisitions for our STOP SHOP brand and currently have a number of smaller packages under analysis. Our goal is to increase the STOP SHOP portfolio from the present level of 72 to roughly 100 locations. These retail parks generate rental yields of 7.5% to over 8% and, for this reason, are a very interesting product.
In April we acquired an investment of roughly 29% in S IMMO and are currently working on the closing procedure – which means registration with the competition authorities in a number of countries. This transaction is expected to close during the summer. “The two companies fit very well together“, indicated Schönauer.
Following are a few of the many questions asked by the investors:
How do we see the Romanian market? And what are the plans for the pipeline projects in Romania, which currently total roughly EUR 130 million?
These assets consist primarily of land reserves which were purchased by IMMOFINANZ in earlier years, explained Schönauer, and they are generally intended for sale. For example, we sold two sites in Bucharest with over 50,000 sqm only two weeks ago. Our overall view of the Romanian market is positive: we are one of the largest office players in Bucharest and operate four VIVO! shopping centers in secondary cities. However, no development projects are underway in this country at the present time.
There is still a high discount between the share price and the book value – what is being done to change this?
Schönauer agreed that the development of the share price is still not satisfactory – in spite of the restructuring measures. “We are working hard to change this situation, and results for the first quarter show that we are on the right course.“ The goal now is to also deliver the promised numbers in the coming quarters. Our guidance calls for FFO 1 of more than EUR 100 million in 2019.
How are we preparing for possible crisis scenarios, for example from the political arena or a trend reversal on the market?
“We have strengthened IMMOFINANZ and made the company crisis-proof during the past quarters“, emphasised the CFO. Gearing, measured by the net loan-to-value ratio, has fallen to roughly 40%, and we have a good liquidity buffer. Our strategy is to take a slightly more conservative approach. In that way, you can also make interesting acquisitions in a potentially difficult market situation.