Annual Report • Mar 27, 2014
Annual Report
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| Interview with the Chairman and the Managing Director |
02 |
|---|---|
| 2013 in brief | 04 |
| A Royal Anniversary | 06 |
| Key fi gures | 08 |
| Strategy | 12 |
| Sustainable construction | 14 |
| Property development | 18 |
| Belgium | 20 |
| Grand Duchy of Luxembourg Poland |
42 50 |
| The real estate portfolio | |
| in tables | 56 |
| Directors' Report | 58 |
| Corporate Governance Statement |
70 |
| Remuneration Report | 80 |
| Consolidated accounts | 87 |
| Statutory Auditor's Report | 124 |
| Statutory condensed fi nancial statements |
125 |
| General information | 128 |
150 YEARS
IMMOBEL, quoted on the Brussels Stock Exchange since 19 September 1863, has been a major player in property development in Belgium for 150 years. It is also active in the Grand Duchy of Luxembourg and in Poland. Its business covers the offi ce, residential and landbanking sectors, ensuring the diversifi cation of its portfolio of projects. Its vision of the market and its expertise enable it to design, develop and manage ambitious real estate projects that create long-term value while respecting the environment and integrating the major issues facing society.
Gaëtan Piret1, Managing Director & Baron Buysse CMG CBE, Chairman of the Board of Directors
In Europe, 2013 was marked both by a rise in stock prices and continuing worrying levels of unemployment. How has IMMOBEL evolved in this particular context?
Baron Buysse / Despite the unstable economic context that we experienced in 2013, our company stayed on course. In terms of results the year was difficult for IMMOBEL. But investors welcomed our determination to remain faithful to the strategy the company has been following for the last few years. The company's stock price rose 27% in one year. That is a great performance.
Gaëtan Piret / We were able to make some very interesting acquisitions. And a series of projects in which we have invested especially heavily have developed well, particularly in Warsaw and in Luxembourg, where we have completed the acquisition of the Kons project. We have obtained provisional acceptance from the occupant of Belair 1. Besides that, we have also obtained the permits for projects such as Gateway in Zaventem and Cedet in Warsaw.
G.P. / The office market in Brussels has been sluggish for several years. It is more unfavourable now than it's been for twenty years. In this sector, we notice that the average rental vacancy in Brussels is 10%, a rate which is decreasing. The situation is more favourable in the Grand Duchy of Luxembourg and Poland, the two other countries where we have a presence. Demand in Warsaw has continued to be sustained, but there is an increase in rental vacancy. In the town centre of Luxembourg vacancy remains under 5%. As in Belgium, there is considerably less growth on the outskirts.
That said, I repeat what I said previously: the office rental market in Brussels is in decline. There is little demand. The only bright spot on the horizon is that there is a significant decrease in new buildings amongst the vacant rental stock. In Brussels the office market is clearly lagging behind those in Poland and Luxembourg. On the other hand, the residential and landbanking markets did relatively well in Belgium, although we did notice a decline in sales during the second half year. But prices remained stable. The sector benefitted from a combination of positive elements extrinsic to the property market.
Though it is present in Belgium, Luxembourg and Poland, IMMOBEL is not yet active in each of its lines of business in all three countries. Is this a deliberate choice or a question of opportunity?
B.B. / It is not a deliberate choice. But we want to focus first on one segment per country - like offices in Poland, for example. Obviously we are attentive to the opportunities in the markets where we are present. In Luxembourg, therefore, we initially invested in an office project, before developing a residential or mixed project (offices, residential and retail). In Poland, having had a series of key offices projects, we are now interested in residential and landbanking as well.
2013 was a very special year for IMMOBEL, one in which it celebrated the150th anniversary of its foundation. What are your thoughts on the way in which the company has evolved since its creation?
G.P. / It would be fair to say that there has been both continuity and a break: continuity with regard to property development and the natural expansion of our activities, but a break as far as our new policy of going for geographic diversification is concerned. Nonetheless, we are still in the same business in the three countries where we have a presence.
B.B. / IMMOBEL has always participated in big, ambitious projects. That has been a constant throughout the company's history. Since its foundation IMMOBEL has invested in the transformation of entire areas of cities, with the erection or renovation of complete neighbourhoods. Today the company continues to be a major player in urban development, with projects like Bella Vita and Belair, for example.
G.P. / The company's stock market listing is another point of stability. IMMOBEL is the oldest Belgian company listed on the stock market. It has gone through all the financial and property crises by relying on unique competences. This element of continuity is a real asset for the company.
G.P. / Belair is exceptional. The project evolved a great deal in 2013 because we sold the first phase in June – on condition precedent of acceptance by the occupant and the purchaser – and the building was accepted by the occupant at the end of December. The Bella Vita project is progressing at top speed too. It is a magnificent project. We are constructing a real village, a place where people can meet and live. We're proud of Green Hill, as well. We're building 174 housing units, a number of which are already occupied. Black Pearl is also progressing positively. The first stone was laid and the structural work was nearly finished in 2013. The whole of Lindepark, in Tervueren, has been sold already, although the project has only just started. Gateway, on the Zaventem airport site, is likewise a very important development and has been completely pre-leased. The project was acquired in 2012 and work on the construction site began early in 2014. Apart from that, in terms of landbanking we have acquired 40 hectares in Ekeren, near Antwerp. We have made other important investments in Flanders too.
For some time now we have been seeing the conversion of office complexes into residential areas. How is IMMOBEL positioning itself with regard to this development?
G.P. / Cities are evolving. Sometimes offices just don't belong any more in certain neighbourhoods. The residential market takes precedence. IMMOBEL has acquired expertise in dealing with this type of challenge, so it is a notable evolution in which IMMOBEL very quickly took an interest. But it is not a panacea. Some buildings do not lend themselves well to this sort of conversion. The price of this type of transformation and that of reconstruction are generally identical, and there are usually greater constraints with a conversion.
B.B. / No, because our financial results are just stable. But, thanks to the strategic turnaround we initiated a few years ago, residential and landbanking have compensated for the disappointing results in the office market in Belgium. Moreover, in our business we are sometimes subject to deferment of the completion of a major sale. That was the case with Belair, the sale of which was postponed to the first quarter of 2014, although initially we hoped to complete at the end of 2013. Generally speaking, 2013 was a year in which we sowed a lot of seeds. We shall reap the results later.
G.P. / We have a few nice projects that are nearing completion and that will bring growth to the company. We have a certain visibility on the next five years too. We are convinced of the pertinence of our choices, although no company is safe from projects that turn out to be less successful.
B.B. / For the reasons mentioned earlier, 2014 will be exceptional in terms of results. The office market will continue to be difficult in Belgium, but there are opportunities to be seized in residential and landbanking, in Belgium as well as in Luxembourg and Poland. Furthermore, we remain confident about the office market in Luxembourg and Poland. We look to the future with serenity. Once again, we would like to thank our employees, our partners and our shareholders for the confidence they demonstrate, every day, in our policies.
2013 will go down in IMMOBEL's history as a very special year.
The company celebrated its one hundred and fiftieth anniversary at the Egmont Palace in the presence of His Majesty the King and numerous personalities from the world of politics, the judiciary, business and real estate.
Faithful to the desire to rise to the major urban challenges, which has guided it since its foundation, IMMOBEL has expanded its sphere of activity to include Luxembourg and Poland.
The company's strategy is based on geographic and sectoral diversification, which is the best defence against the vagaries of the market.
The operations carried out in 2013, some of which were particularly emblematic, are an illustration of this.
IMMOBEL develops, alone or in partnership, a portfolio of about 3 000 residential units, 310 000 m2 of offices and 440 ha of land.
In partnership with two other companies, IMMOBEL is redeveloping what is currently the Galerie Kons, opposite the station in the City of Luxembourg. With a surface area of some 20 500 m², the site comprises various functions (offices, retail, residential and parking), all of which will be preserved in the redevelopment project. A long-term lease has been signed with ING Bank, which intends to set up its Luxembourg headquarters there.
IMMOBEL has acquired 50% of a company that owns land located in the centre of Warsaw, opposite the Palace of Culture, with a view to developing a project consisting of approximately 18 000 m2 of offices and retail.
On 19 March 2013 IMMOBEL carried out a private bond placement for a total of 60 MEUR. Due in March 2018, the bonds will yield a gross annual interest of 5.5%.
IMMOBEL and its partner have sold their stake in RAC 1 S.A., the company that holds the first phase of the Belair project. Hannover Leasing, a leader in structuring real estate assets in Germany, has acquired 100% of the shares in RAC 1, in association with an Asian partner, on condition precedent of acceptance of the building by the occupant and the purchaser.
In 2013, the first stone of the Lindepark project in Tervuren was laid. The four buildings will comprise 60 apartments.
As part of the simplification of the IMMOBEL Group structures, the company has absorbed LOTINVEST, which was in charge of the landbanking business and some residential developments.
The first stone of the passive office building Black Pearl was laid in the presence of the Minister for the Environment, Energy and Urban Renewal for the Brussels Region and the Alderman for Town Planning in the City of Brussels. At the heart of the European district, the building will have a surface area of 11 000 m2 above ground.
Established in 1863, IMMOBEL is the oldest Belgian company still listed on the Brussels Stock Exchange (without considering the National Bank of Belgium). On 19 September 2013 it celebrated its one hundred and fiftieth anniversary on the stock market during a ceremony at the Brussels Stock Exchange.
On 19 December, IMMOBEL organised an academic sitting to mark the 150th anniversary of its foundation. The event was graced by the presence of His Majesty the King. Two internationally reputed architects presented their visions for the future to the many guests.
The show house of the Charmeraie project was inaugurated in the presence of the Mayor of Uccle and the Alderman for Town Planning. The complex, implanted on a unique site adjoining a classified Natura 2 000 green zone, will eventually comprise 39 houses and 32 apartments spread over two buildings.
The Federal Police and the Belgian Buildings Agency have taken delivery of the Belair building. As of 2014 the Federal Police will occupy nearly 80 000 m2 of offices and other dedicated premises there.
0 5
IMMOBEL has acquired the company holding the long-term lease rights on the Chien Vert office building (4 300 m2 ) in Woluwe St Pierre, with the intention of converting it into highend residential accommodation. The building, opposite Woluwe Park, enjoys a strategic position in a protected environment.
Peter Wynne Rees, City of London
His Majesty the King, accompanied by Baron Buysse, Gaëtan Piret & Didier Reynders
left : James von Klemperer, KPF Associates right : Didier Reynders, Minister Foreign
Affairs
On 19 December 2013 IMMOBEL organised an academic sitting to mark the 150th anniversary of its founding. The celebration took place in the Egmont Palace, in the presence of His Majesty the King and numerous personalities from the worlds of politics, the judiciary, business and real estate.
His Majesty the King, Baron Buysse & Gaëtan Piret
Two internationally-renowned architects (James von Klemperer and Peter Wynne Rees) spoke about their visions of urban planning and architecture.
James von Klemperer has degrees from the most prestigious universities in Architecture, Arts, History and Literature. As partner, he is in charge of design at Kohn Pedersen Fox Associates (KPF).
With 600 collaborators, KPF is one of the biggest architectural firms in the world. They are active in 35 countries and the many projects they have conceived have won over 300 highly acclaimed prizes.
KPF Associates has designed almost 40% of the highest buildings in the world. Their approach is embodied in the philosophy set out by Mr von Klemperer. The challenges we face now, which are associated with sustainable development, entail, according to Mr von Klemperer, inventive architectural solutions that combine new ways of integrating multiple purposes, public transport connections and the creation of open public spaces in our town centres.
Peter Rees is City Planning Officer of the City of London. For the last 30 years he has been in charge of planning and redevelopment in this international financial and business hub.
Mr Rees has degrees in Architecture and Town Planning from the best universities. He travels the world sharing his experience, which has earned him numerous awards.
A large audience at the academic sitting at the Egmont Palace
It is under his leadership that the City of London has seen the construction of buildings that have become iconic, such as the famous "Gherkin" (2004) and, more recently, the "Shard" (2010). The scale of these buildings is considerable.
The subject of his presentation, moreover, was "Is high rise building a priority for CBD". In Mr Rees's opinion, the City of London lacked the space to accommodate all the companies wanting to set up business there. To meet this challenge, a collection of office towers has been built to extend the financial and business centre - with success, as we all know. However, the quality of the areas, roads and leisure facilities introduced is essential. The mixture of functions is limited: offices and housing are not always compatible.
+78%
GROWTH OVER 5 YEARS
OF PROJECTS
A BALANCED PORTFOLIO
OPERATING RESULT / NET RESULT (MEUR)
148MEUR MARKET CAPITALIZATION BY END 2013
+27% DURING 2013
+140% BETWEEN BEGINNING 2009 AND END 2013
THE COMPANY FULFILLS ITS ENGAGEMENTS TOWARDS BANKS AND BOND HOLDERS
| 2009 | 2010 | 2011 | 2012 | 2013 | |
|---|---|---|---|---|---|
| Operating income | 113.0 | 85.6 | 81.1 | 133.7 | 65.1 |
| Operating expenses | -93.5 | -72.4 | -58.6 | -114.3 | -54.5 |
| Operating result | 19.4 | 13.2 | 22.6 | 19.4 | 10.6 |
| Financial result | -4.0 | -4.9 | -5.4 | -6.8 | -9.3 |
| Share in the results of associates | 0.0 | 2.9 | 0.3 | 0.0 | 0.2 |
| Result before taxes | 15.4 | 11.2 | 17.5 | 12.6 | 1.5 |
| Income taxes | -0.7 | -0.7 | -1.3 | -0.9 | 0.0 |
| Result from continuing operations |
14.7 | 10.5 | 16.2 | 11.7 | 1.5 |
| Result from discontinued operations |
0.9 | 0.0 | 0.0 | 0.0 | 0.0 |
| Result for the year | 15.6 | 10.5 | 16.2 | 11.7 | 1.5 |
| Share of IMMOBEL | 15.6 | 10.6 | 16.2 | 11.7 | 1.5 |
10.6MEUR
OPERATING RESULT
| 2009 | 2010 | 2011 | 2012 | 2013 | |
|---|---|---|---|---|---|
| ASSETS | |||||
| Non-current assets | 13.2 | 11.4 | 5.8 | 7.7 | 6.5 |
| Intangible assets and goodwill | 0.0 | 0.0 | 0.0 | 0.0 | 0.1 |
| Tangible assets and investment property |
3.4 | 3.6 | 2.5 | 3.9 | 3.6 |
| Financial assets | 9.3 | 7.5 | 1.3 | 2.4 | 1.1 |
| Other | 0.6 | 0.3 | 1.0 | 1.4 | 1.7 |
| Current assets | 345.3 | 292.1 | 401.0 | 409.9 | 520.4 |
| Inventories | 260.3 | 240.8 | 327.9 | 359.9 | 464.7 |
| Treasury | 67.7 | 34.2 | 47.0 | 26.9 | 31.4 |
| Other | 17.3 | 17.1 | 26.1 | 23.1 | 24.4 |
| Total assets | 358.5 | 303.5 | 406.8 | 417.6 | 527.0 |
| EQUITY AND LIABILITIES | |||||
| Equity | 168.7 | 172.1 | 182.8 | 187.7 | 183.2 |
| Non-current liabilities | 69.3 | 71.9 | 112.6 | 136.2 | 152.4 |
| Financial debts | 58.8 | 65.6 | 109.3 | 135.5 | 151.5 |
| Other | 10.4 | 6.3 | 3.3 | 0.7 | 0.9 |
| Current liabilities | 120.5 | 59.4 | 111.4 | 93.7 | 191.4 |
| Financial debts | 44.9 | 22.5 | 74.3 | 51.8 | 148.8 |
| Derivative financial instruments | 2.2 | 1.8 | 1.8 | 2.1 | 0.5 |
| Other | 73.4 | 35.1 | 35.2 | 39.8 | 42.2 |
Total equity and liabilities 358.5 303.5 406.8 417.6 527.0
| 2009 | 2010 | 2011 | 2012 | 2013 | |
|---|---|---|---|---|---|
| Cash flow1 | 17.2 | 8.5 | 14.0 | 8.0 | 0.0 |
| Net result, Group's share | 15.6 | 10.6 | 16.2 | 11.7 | 1.5 |
| Equity, Group's share | 168.7 | 172.2 | 182.8 | 187.7 | 183.2 |
| Market capitalization | 101.8 | 130.2 | 101.8 | 116.4 | 148.4 |
| 2009 | 2010 | 2011 | 2012 | 2013 | |
|---|---|---|---|---|---|
| Number of shares at year-end (thousand) |
4 122 | 4 122 | 4 122 | 4 122 | 4 122 |
| Cash flow | 4.2 | 2.1 | 3.4 | 1.9 | 0.0 |
| Net result, Group's share | 3.8 | 2.6 | 3.9 | 2.8 | 0.4 |
| Value of equity | 40.9 | 41.8 | 44.4 | 45.6 | 44.4 |
| Gross ordinary dividend | 2.00 | 1.25 | 1.75 | 1.40 | 0.00 |
| Net ordinary dividend | 1.50 | 0.94 | 1.31 | 1.05 | 0.00 |
| 2009 | 2010 | 2011 | 2012 | 2013 | |
|---|---|---|---|---|---|
| List price on 31 December (EUR) | 24.70 | 31.58 | 24.70 | 28.25 | 35.99 |
| Maximum quotation (EUR) | 24.70 | 32.85 | 34.00 | 28.90 | 37.43 |
| Minimum quotation (EUR) | 11.03 | 23.02 | 23.86 | 24.15 | 28.36 |
| List price/book value | 0.6 | 0.8 | 0.6 | 0.6 | 0.8 |
| Gross return for 1 year2 | 64.8% | 36.0% | -17.8% | 21.5% | 32.4% |
| Gross ordinary dividend/ last list price |
8.1% | 4.0% | 7.1% | 5.0% | 0.0% |
| Net ordinary dividend/ last list price |
6.1% | 3.0% | 5.3% | 3.7% | 0.0% |
Net result without the non cash expenses (amortisation, depreciation charges, provisions ...) and the non cash income (fair value ...).
Gross return for 1 year: (last closing price + dividends paid during the last 12 months - first list price for the period)/ first list price for the period.
Since it was founded, in 1863, property development has been at the heart of IMMOBEL's strategy.
Attentive to developments in the market, the company has diversified its activities to encompass three lines of business office properties, the residential sector and landbanking - in three countries.
In addition to Belgium, IMMOBEL now exercises its expertise in Luxembourg, where it has had a presence since the early 2000s, and, since 2011, in Poland.
The company targets three types of clients: the state, the EU and/or institutional investors for large office complexes; private clients for residential property and land purchases; and private clients wishing to invest in housing.
| BELGIUM | LUXEMBOURG | POLAND | |
|---|---|---|---|
| OFFICE | X | X | X |
| RESIDENTIAL | X | X | |
| LANDBANKING | X |
So far, IMMOBEL has developed all three activities in Belgium, the office and residential segments in the Grand Duchy of Luxembourg, and the office market in Poland, including projects with a mix of retail too.
Today this diversification is bearing fruit. Previously, a multi-year average of close to 90% of profits generated by IMMOBEL came from our office activity; the balance was attributable to landbanking. In Belgium and Luxembourg profits generated by residential and landbanking have now increased to a multi-year average of 40 to 50% of the company's profits. Thanks to this diversification in terms of geography and markets, IMMOBEL currently manages a balanced portfolio that is less exposed to economic cycles and to the local market specifications, allowing it to cover its fixed costs in times of low activity in the offices segment.
IMMOBEL takes a prudent approach to the acquisition and development of its projects, applying precise selection criteria. These criteria address, among others, location, size and phasing, the architectural quality that can be deployed, the environmental characteristics that the project must meet, transport facilities and communication routes as well as profitability compared to estimated risk.
Moreover, IMMOBEL ensures it enters into partnerships for particularly large projects or those requiring specific added value. These partnerships are part of its goal of diversification.
VISION BUILDING THE FUTURE ADDING VALUE
GRAND DUCHY OF LUXEMBOURG POLAND
SEGMENTS OFFICE RESIDENTIAL LANDBANKING
PROFILES PUBLIC PRIVATE INVESTORS
Since its creation, 150 years ago, IMMOBEL has taken a long-term approach. The buildings constructed by the company are therefore also references in terms of sustainable development. IMMOBEL has always endeavoured to be a trailblazer in this respect and to anticipate the standards of tomorrow.
269 HOUSING UNITS OF BELLE VITA FUELLED BY BIOMASS AND URBAN HEATING
WE MEET PAUL MUYLDERMANS, HEAD OF PROJECT MANAGEMENT, WHO IS RESPONSIBLE FOR SUSTAINABLE CONSTRUCTION AT IMMOBEL, AND DAVID DE BORMAN, "ARIES CONSULTANTS"
The projects carried out by the Group integrate the most innovative technologies. The wellbeing of the end-users and respect for the environment are what guide IMMOBEL in its activities. The company uses the BREEAM label as its reference, a label which certifies buildings' energy and environmental performance.
David de Borman / Sustainable development is generally defined as development that meets the needs of the present without compromising the capacity of future generations to meet their own needs. I would add that the human element and technology are closely linked in any project of sustainable development.
Paul Muyldermans / As far as IMMOBEL is concerned, sustainable development includes all the elements in a construction or renovation process that add to the comfort of the end-user. The approach must be coherent and global, both ethical and critical. We are careful to engage in real dialogue with our partners in all our projects, in order to achieve the best compromises between aesthetic and rational choices.
In pragmatic terms, how does the notion of sustainable construction translate in IMMOBEL's line of business?
D.d.B. / There are three major aspects involved in the development of any project; they are economic, social and environmental. Every new construction or renovation requires decisions to be made regarding a series of criteria, such
as the location of the building and the urban fabric surrounding it, the purpose for which the building will be used and the profile of the future occupants, the budget allocated to the site, the range of 'sustainable' instruments that can be developed as part of the project and, finally, the specifications necessary for possible certification.
P.M. / Sustainable construction has always been an integral part of IMMOBEL's professional considerations. Our reflexes have evolved along with the technologies. We endeavour to anticipate the legislation and the standards of tomorrow. For this reason we systematically consult a special technologies study bureau before submitting an application for an urban development permit. As a result of studies on buildings' energy performance, for example, we check the component elements of the facades. We carry out a considerable amount of research and studies in advance. When buying a building, moreover, one gives its envelope as much consideration as its interior. Does it get the sun? Will it overheat? We think of all the aspects affecting comfort inside it.
What new evolutions can be observed in terms of sustainable development in real estate?
D.d.B. / The legislation is evolving constantly. We constantly adapt. We have noticed that developers like IMMOBEL increasingly call on consulting bureaus very early in the development of a project. Aspects linked to the environment are taken into consideration well before a permit application is submitted. On the other hand, all big projects fall within the scope of certification programmes like Breeam and others. We have to respect specifications and procedures that are sometimes very complex.
P.M. / We have noticed that buyers give extra consideration to the relationship between extra costs and added value in ecological terms. They are sometimes reluctant to pay higher prices if the benefits expected in terms of a building's performance are not, in their eyes, sufficient. This is certainly true for housing. That said, between existing built stock, which accounts for around 90% of current buildings, and new build, the new buildings, even those that are 'reasona-
BELLA VITA Waterloo FCM Architects - Baudouin Courtens & Associés
bly good', are far superior to the older buildings in terms of energy performance. The expectations of the public sector concerning new build are generally higher. Sometimes the BREEAM label 'exceptional' is not enough. Passive buildings are the norm.
Is energy performance still the main preoccupation in terms of sustainable construction?
D.d.B. / Energy continues to be a major consideration for real estate designers. For example, building envelopes are insulated more and more. Heating, cooling, ventilation - the technologies evolve constantly. These days there are a variety of different types of heating: geothermics, heat pumps, pellet stoves and so on, whereas we used to be content with installing two boilers in parallel. Other elements, like mobility, are taken into account in every new project too now. Sustainable construction must be seen in a global context. Belair, for example, is a mixed development project. The needs of the various players, the technical and human aspects, are integrated into the consideration of the whole complex.
BELAIR Brussels (City) Studio Arne Quinze - M. & J-M Jaspers - J. Eyers & Partners
BLACK PEARL Brussels (European District) Art & Build
P.M. / The Bella Vita project in Waterloo is a good example of IMMOBEL's desire to offer alternative solutions where energy is concerned. The urban heating for the 269 housing units and the other service buildings that make up the complex is fuelled by biomass.
Besides the desire to optimise energy production in buildings, and the fact that better consideration is given to the general environment in which projects are built, what new avenues are being followed by real estate designers in their desire to build sustainably ?
D.d.B. / Personally, I am very aware of the question of "grey" water. There is a real potential to be exploited there, particularly in the residential sector. Shower water, for example, could be used for heat recuperation. Biodiversity is a new issue too. Besides green roofs, which are now compulsory for all new build in the Brussels Region, there is a desire to think more deeply about the development of green areas (choice of species for example). Traceability and choice of materials are likewise at the heart of new issues. This evolution is happening at a European level, in terms of labels and certificates in particular.
How is IMMOBEL positioning itself compared to its competitors where sustainable development is concerned? Is the company still a reference for the profession?
P.M. / We are clearly at the leading edge in terms of sustainable development. We have a voluntaryist policy in this respect and we make sure that all of the partners associated with the projects we develop share this vision. We endeavour to remain ahead of the regulations. With regard to electricity cables, for example, we anticipated the new standards. Standard cables can, in the event of fire, emit toxic smoke. The cables we lay do not have this drawback. We are particularly careful, as promoters, to integrate into our projects all the materials that represent positive advances for end-users and that are occupant-friendly in health terms.
D.d.B. / In the framework of the Belair project, in which I am personally involved as a consultant, I have been able to observe the lengths to which IMMOBEL goes to ensure that there is genuine dialogue with all the parties associated with the projects with which it is involved, including the authorities. IMMOBEL nurtures relationships with the local authorities and the neighbourhood in order to finetune its architectural, technological and urban planning choices. This is an integral part of the process of sustainable development. Moreover, IMMOBEL is in control of the most complex projects, which means it can be BREEAM certified for the buildings that necessitate a multidisciplinary approach. The specifications of the Belair complex, which is occupied by the federal police, were very specific because of its tenant. It includes labs, which entails treatment of waste water, a shooting range which necessitates special acoustics, a public area, offices where security is of primary importance, and so on.
1 7
IMMOBEL has developed an expertise in the transformation of offi ces into housing. What are the diffi culties that have to be dealt with in this type of conversion?
P.M. / In office buildings we are often faced with depths of 20 metres, although for housing the norm is 14 metres. That means we should find solutions to take full advantage of this difference. The great challenge is to bring light into these spaces. In the past the price per square metre for office property was higher than the price of housing. These days there is very little difference. So the transformation of offices into residential properties requires real architectural and technical knowhow in order to keep the sales prices competitive compared to those for new build. Sometimes it is better to knock everything down and rebuild. These are decisions that have to be taken on a case by case basis.
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BELLA VITA Waterloo FCM Architects - Baudouin Courtens & Associés
OFFICE SPACE 2 800 RESIDENTIAL UNITS 440 HA LANDBANKING1
BELAIR Brussels (City) Studio Arne Quinze - M. & J-M Jaspers - J. Eyers & Partners
An exceptional environment in the heart of Waterloo for this new way of living.
163 BUILDING PLOTS DISTRIBUTED OVER THE WHOLE COUNTRY IN PORTFOLIO
The Belgian real estate market is full of contrasts. The office sector is credited by new constructions while suffering from rental latency of less strategic locations and from old buildings. The residential and building plots markets benefit from constant interest, despite a precarious economic environment.
| BRUSSELS | 2012 | 2013 | 12 MONTH OUTLOOK |
|---|---|---|---|
| Stock million m² | 13.1 | 13.3 | |
| Total uptake (m²) | 423 000 | 331 000 | |
| Availability rate | 10.4% | 10.1% | |
| - CBD | 6.2% | 5.9% | |
| - Outside CBD | 17.6% | 17.5% | |
| Deliveries (m²) | 85 000 | 223 000 | |
| Upmarket rents (EUR/m²/year) |
285 | 285 | |
| Rent top quartile (EUR/m²/year) |
219 | 210 | |
| Weighted average rents (EUR/m²/year) |
172 | 169 | |
5.9% OFFICES VACANCY RATE IN THE CBD, AT ITS LOWEST FOR 5 YEARS
The rental market in Brussels is gradually returning to normal, despite the lack of activity by occupants in 2013. Availability is at its lowest for 5 years, a trend which has been especially noticeable in the CBD, where availability is down to only 5.9%. Production of high-risk developments remains limited, although a rise in the number of construction starts in the CBD has been evident since late 2012. Outside the CBD, speculative production remains very limited. Although availability has been in decline over the last few quarters, it nonetheless remains high in decentralised districts and on the outskirts. The trend towards converting old, partially or entirely vacant buildings continues and has contributed to the decrease in availability in the CBD and decentralised areas. The prospect of an economic upturn should lead to an improvement in demand from occupants, but we do not expect massive recovery as long as GDP growth remains fragile.
The volume of investment in all types of buildings in Belgium rose by 2% to around 2.24 billion EUR in 2012, above the average for the last 5 years, which was 1.8 billion EUR. Investments in offices increased by 47% compared to 2012, while investments in retail failed to repeat their 2012 record, with volume down by 15%. Demand is concentrated on core products that provide a safe income flow with a risk that is perceived to be low (such as offices leased long term and well established shopping centres). We also notice a rise in the number of transactions involving high yield secondary properties as well as a stable number of redevelopment transactions.
The rental market in Brussels was hit especially hard by the general economic sluggishness in 2013, with uptake down by 21.7% compared to 2012 and a total volume of 331 000 m². This is the weakest rental uptake since 1993. It can be explained by the drop in activity in the private sector, as well as in the public sector: in 2013 the corporates carried out 326 transactions, which is a drop of 6% compared to 2012 and 13% lower than the ten year average. In terms of volume, corporate rental uptake dropped 19% despite a major double transaction by AXA, which on its own accounted for 15% of the uptake in 2013. However, rather than moving to new premises, some corporates have opted to renegotiate their lease, sometimes with a review of the rent, sometimes with a change in the surface occupied. As a percentage of the total uptake, corporates account for 70%, up on the 67% in 2012. Indeed, the Belgian public services, both federal and regional, have not been very active and account for only 8.7% of the uptake, as opposed to 10.2% in 2012 and an average of 18.4% over the last ten years. The European institutions
2 4
BLACK PEARL Brussels (European District) Art & Build
BRUSSELSTOWER Brussels (City) Jaspers, Eyers & Partners
have continued to be active, although less than in 2012, with their uptake down by 31% compared to 2012. The European institutions' share of the total uptake was 17%, as against 20% in 2012 and an average of 11% over the last ten years.
The reduction in availability is corroborated by a vacancy rate that has gone from 10.4% at the end of 2012 to 10.1% at the end of 2013. The trend is especially evident in the CBD, where the vacancy rate, at 5.9%, has dropped to below the 6% mark for the first time since Q4 2008. The historically low level of speculative deliveries and the continued conversion of old office buildings for other purposes explain this drop and compensate for the low level of activity on the leasing market. Outside the CBD, however, the vacancy rate remains high, at 17.5%, despite the fact that conversions continue; and new speculative deliveries have been at a standstill for several years. To be more precise, in decentralised districts availability is declining thanks to conversions and a certain upswing in demand, but it is still high, at 15%.
The situation is more problematic on the outskirts where, although speculative developments have also been at a standstill since 2008, the vacancy rate remains high, at 20.6% at the end of 2013. The trend towards conversions has not yet reached the outskirts.
Deliveries for 2014 are estimated at 103 000 m², of which 55 000 m² are speculative and located in the CBD, 34 000 m² are in the quartier Léopold, 13 000 m² in the Pentagone and 8 000 m² in the quartier Nord. In 2015, 177 000 m² are expected to be delivered including 115 000 m² that are speculative.
In 2013, nominal rents dropped slightly, as is demonstrated by the 4% reduction in rents in the upper quartile and the 2% reduction in the weighted average rent. Upmarket rents for exceptional buildings, on the other hand, have remained unchanged at 285 EUR/m² per annum.
Incentives have remained high and the analysis of a selection of transactions carried out in the course of the past year reveal an average delta of 15 to 25% between nominal rents and economic rents, with a trend towards stabilisation in districts outside the CBD and assumptions of a reduction in the CBD.
Several large-scale transactions on behalf of the Belgian public sector, including Actiris and the Flemish Community, are expected in 2014, Demand from the European institutions for office space will continue to be high, particularly as its building stock is aging and some of the leases are nearing expiry. The European Commission's real estate strategy tends to focus on buildings of over 20 000 m², with low energy consumption, situated in close proximity to public transport. In the medium term, a shortage of good quality property cannot be excluded in the CBD. There is uncertainty as to the demand from the private sector, which is very dependent on economic growth.
Mobility and accessibility by efficient public transport are key factors in companies' choices when it comes to relocation. The efficiency of the work spaces is also important. The average area per employee is decreasing. There is a general trend amongst a wider variety of occupants towards open plan and a growing number of companies envisage the flex desk option.
The total volume of investment in Belgium in 2013 came to 2.24 billion EUR, up by 2% over the year. The office sector recorded a hike of 47% compared to 2012, thereby surpassing the 25% average of the last 5 years. For its part, the retail sector has not repeated its 2012 record, and finished the year down 15%, although it was 36% above the average of the last 5 years. The industrial sector dropped 2% compared to 2012 and exceeded the average of the last 5 years by 8%, while remaining globally in line with the volumes of the last ten years. There was a drop of 60% in investments in retirement homes compared to 2012, which was a record year.
Belgian investors (73%) still account for the majority of the total investment volume, although some so-called 'local' investors actually represent foreign capital. Institutional investors, such as insurance companies and pension funds, account for 33% of the total volume. In 2013, they concentrated overwhelmingly on offices (88%) and on core products. The Sicafis increased their investments by 64% compared to 2012 and accounted for 22% of the total volume. Their investments were diversified, with 42% in offices, 26% in retail, 20% in industrial and 12% in retirement homes.
| 2012 | 2013 | 10 YEAR AVERAGE |
TREND 2014 |
|
|---|---|---|---|---|
| Offi ces | 850 | 1 251 | 1 409 | |
| Industrial | 191 | 187 | 195 | |
| Retail | 755 | 646 | 504 | |
| Retirement homes | 302 | 120 | 149 | |
| Other | 96 | 31 | 130 | |
| Total | 2 195 | 2 235 | 2 554 |
Private investors were active in more opportunistic acquisitions, in retail as well as offices and redevelopment transactions.
The yields on upmarket offices in the CBD with standard leases are in the range of 5.8% to 6.5%, or 20 basis points lower than in 2012. Outside the CBD, transactions by specialised investors remain limited and leave room for more opportunistic investors demanding higher yields. Well-leased good quality buildings fetch between 7.5% and 8%, or more. Yields on office buildings with longterm leases are also under pressure and may drop below the 5% mark.
Yields on upmarket industrial property have remained stable at 7%.
Demand for retail buildings remains high following strong competition between investors for all types of upmarket products, both in shopping centres and on high streets. Yields on high street properties are still under pressure and some very upmarket transactions have been signed at under 4.25%. There were few transactions involving shopping centres in 2013, so prime yields remained stable at between 5 and 5.25%. In 2013 several transactions involving portfolios of retail warehouses were registered. Yields for this type of building are also under pressure, given the competition between buyers, and are between 6.0% and 7.5%.
The retirement home market and its liquidity are fairly new, yields are estimated at between 5% and 6.5%. The same range applies to student homes, another segment of the market that is new and where liquidity is relatively low.
The recovery in the office investment market should continue in 2014, particularly with largescale transactions involving core buildings. Liquid assets available to international institutional investors have increased and the latter are ready to diversify their investments across regional loca tions such as Brussels. The slight revival of devel opment activity in all asset categories should con tribute to an increase in liquidity in the office, retail and logistics markets.
Yields from real estate will continue to be attractive compared to those from other investment prod ucts. Although long-term interest rates have risen in the last twelve months, the difference between the rates for sovereign or corporate bonds and the returns on real estate remains favourable, as long as property is leased long term to cred itworthy tenants (offices) or it is underpinned by the possibility of releasing it with attractive condi tions (shopping centres in large towns, high street shops or logistics).
Where buildings do not have all these elements, private investors and family offices should continue to be active and to seize opportunities which, while they present a certain degree of risk, also have the potential for added value in the medium term.
Finally, there should continue to be a high level of transactions involving former office buildings for redevelopment, basically with the aim of convert ing them into mid to upmarket housing as well as retirement homes or even schools. The profitabil ity of this type of transaction depends on the cost price of the building and the selling price in its new form. We think therefore that rigorous selectivity is essential, specifically where location is concerned.
YIELDS FROM REAL ESTATE WILL CONTINUE TO BE ATTRACTIVE COMPARED TO THOSE FROM OTHER INVESTMENT PRODUCTS
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GATEWAY Zaventem Jaspers-Eyers - A2RC
We consider the property market in Walloon Bra bant to be part of the outskirts of Brussels. Liège, Charleroi and Namur are therefore the three major markets for office space in Wallonia, with a com bined stock of approximately 1 million m².
At 21 000 m², total uptake in 2013 showed a drop of 37%. The region of Liege accounted for 40% of the transactions, and Hainaut 43%, thanks to the acquisition by the Ministry of Transport of 7 500 m² in Mons.
There were no deliveries in the three main markets in Wallonia in 2013. The main delivery expected in Wallonia is the Tour Paradis in Liège, which is scheduled for early 2015 and will be occupied by the federal Finance Ministry. The availability rate remains very low, at between 3% and 5% depend ing on the city.
Upmarket rents in Liège, Charleroi and Namur have remained stable at 135 EUR/m² per annum, 125 EUR/m² per annum and 160 EUR/m² per annum respectively.
The investment market in Wallonia was calm in 2013 and few office transactions were registered. However, we think that if the opportunity of a core product leased long term to a creditworthy tenant were to present itself, it would soon find a buyer.
The total stock in the Flemish Region, with the exception of the municipalities in Flemish Brabant, which are part of the outskirts of Brussels, is estimated to be about 4.5 million m2, 40% of which are in Antwerp.
In 2013 the uptake of offices dropped by 32% to 155 500 m². Antwerp still occupies first place in the market with 40%, despite a drop in activity by occupants of about 31%, but Ghent, with an increase of 44% is fast catching up. Ghent now accounts for 33% of the total uptake in Flanders as against 16% in 2012. Because of the difficulties with mobility in Antwerp, competition with the other cities has been accentuated in recent years. In addition, Ghent, Aalst, Mechelen, Leuven and Hasselt rival it with new products situated along the motorways.
Once again the private sector drove the demand for offices. Although it is traditionally the mainstay of the market, the public sector was only responsible for 4% of the transactions in all of the cities together in 2013. Availability remains relatively high in Antwerp, at 12% at the end of 2013, while it is only 4.5% in Ghent. Availability is declining in Leuven, at 8.1% as opposed to 11% a year ago, but it has settled at 12% in Mechelen.
Developments in Antwerp are limited at the moment and no speculative deliveries are expected before 2015. In Ghent, however, speculative activity has been sustained, as is illustrated by projects under construction in the area round the new Artevelde stadium bordering the E40 motorway. Medium– sized projects are also under construction on the outskirts of Mechelen.
Upmarket rents have remained stable in the Antwerp CBD at 145 EUR/m² per annum. In the Ring district upmarket rents are also unchanged at 140 EUR/m² per annum. In Ghent, however, upmarket rents are up again by 3.4% and have currently reached 150 EUR/m² per annum, which
UNIVERSALIS PARK Brussels (Ixelles) Art & Build
is the highest level in Flanders. In Leuven they have fallen by 6.4% to 145 EUR/m² per annum, the same level as in Antwerp. And in Mechelen rents have remained unchanged at 140 EUR/m² per annum.
Incentives always constitute an important part of lease negotiations. Benefits equivalent to 8-10% reduction in the nominal rent are customary, which is significant but still below the level of the incentives conceded in the decentralised zones and on the outskirts of Brussels.
Several major investment transactions in core offices have been carried out in Flanders, in particular the AMCA building in Antwerp, which was sold to Befimmo, and the new Electrabel headquarters, which is likewise in Antwerp and was sold to Baloise Insurance.
Yields on core properties with traditional leases are between 6.75% and 7.5% in the Antwerp Ring district, Mechelen, Ghent and Leuven. For long-term leases yields are around 5%, similar to other parts of the country.
Exactly as 2012 had led us to expect, 2013 was marked by stability in the residential property market in Belgium as far as the number of transactions carried out.
DUINENZICHT Bredene Berkein This stability in the level of activity was accompanied by a rise in sales prices for houses (+3.2% compared to 2012) and apartments (+2.1% compared to 2012).
In the Brussels Region, which we will discuss in more detail below, there was a slight decline in activity; but prices in the Brussels Region increased by 4.2% for apartments and 1.6% for houses.
Statbel data for the last few years indicates that the offering is likely to stabilise at around 2 000 to 2 200 apartments per year.
The building permits granted in 2013 represented approximately 2 200 apartments (based on the figures for building permits to 30 October 2013, extrapolated for the year).
These statistics also show the reduction, year on year, of the average living space, which is in the order of 75 m² these days.
However, a certain number of very large projects currently being studied should be carried out and could have a positive influence on the volume of the offering for 2014 and subsequent years. The impact of this increased volume on prices needs measuring.
The Brussels Region experienced demographic growth of 1.8%, or 19 766 people, in 2011 and 1.4%, or 15 786 people, in 2012. According to demographers, this trend will continue in the years to come. The increase in the urban population is a phenomenon that can be observed both in Europe and at the global level. The distinctive feature in Brussels, however, is that its geographic territory cannot be extended.
The question which immediately comes to mind is whether this new population has the means to support the demand for new property. The evidence collected seems contradictory and makes it difficult to reach a conclusion.
On the positive side: the more expensive municipalities, i.e. Woluwe-Saint-Pierre, Woluwe-Saint-Lambert, Auderghem and Uccle are experiencing greater demographic growth than the average for the region.
On the negative side: although the most expensive property is to be found in the Brussels Region, average taxable incomes here continue to lag further and further behind those in the other regions.
A large number of economists and financial institutions have raised the issue of the relatively high prices on the Belgian real estate market.
Nonetheless we can see that:
ZUR ALTEN BRAUEREI Eupen Rademacker & Schoffers Architecten
KONINGSLAAN Knokke HC Demytteraere Architectenbureau
PÈRE EUDORE DEVROYE Brussels (Etterbeek) Accarain-Bouillot S.A. Architectes Associés
Real estate activity in Brussels deteriorated somewhat in 2013, with a slight drop in transactions of 2.6% between 2012 and 2013. The figures for the last quarter of 2013 appear to indicate an improvement in 2014.
The median price of an apartment in Brussels was 190 000 EUR in 2013, a 2.7% rise compared to the median of 185 000 EUR in 2012.
The median prices of 3-bedroom apartments rose most strongly, with an increase of 8.9%, while the rise in prices of 2-bedroom apartments was in line with the average.
The average increase of 2.7% hides major disparities from one municipality to another, as the examples below demonstrate.
In Woluwe-Saint-Pierre we see a median price of 241 000 EUR, up 18.3% ; in Auderghem it is 220 000 EUR, up 4.8% ; while in Saint Gilles the median is 197 500 EUR, up 1.3%, and in Anderlecht it is stable, at 140 000 EUR.
In its newsletter on new residential property N°175, published on 25 October 2013, Square Info gave prices of 2 000 to 2 300 EUR per m² for the municipalities in the North and West of Brussels, 2 700 to 3 000 EUR per m² for the South of Brussels, 3 600 EUR per m² for the zone Woluwe-Saint-Lambert and 4 000 EUR for the best districts in the East of Brussels, such as Woluwe-Saint-Pierre.
After the private investors, institutional investors have gone into buying buildings for students. This market offers immediate high returns but could reach its limits in the short term.
In the office sector more and more real estate players are acquiring obsolete office buildings with a view to converting them into housing.
Generally speaking, the market remains stable and even bullish where new properties are concerned.
There is an abundance of mainly negative and/ or contradictory information going around, which could create a climate of uncertainty and impact the volume and prices of transactions in the months to come.
Nonetheless we notice that investors are very definitely present in the real estate market, particularly for new properties.
It is probable that the one-time voluntary disclosure scheme concerning previously undeclared assets has had an influence on investments in bricks in recent years.
Moreover, the buying power of a certain category of foreign buyers is still an important driver in the sector.
All these elements explain the global stability of the market at present, with a growth in prices for new build and a slight drop in prices for existing buildings in the old, unrenovated category.
The fi gures we have for the fi rst three quarters of 2013 confi rm the trend seen in recent years: a decline in the number of transactions and an increase in average prices (+5%).
DEINZE ASTENE Deinze
3 2
During this period the number of transactions came to 11 239 compared to 12 277 for the first three quarters of 2012. Only 1 298 ha were sold during the first three quarters of 2013 as opposed to 1 459 ha for the corresponding period in 2012.
Total revenues from sales of land for development have been relatively stable since 2005, although the number of transactions has declined by 40% in this eight year period and the area sold by 30%, testifying to a hike in prices per m² of nearly 50% during that time.
In the last 20 years the number of transactions and the area sold have fallen by around 60%, whilst average prices have increased fivefold.
As a result, the price of building plots continues to increase - faster than inflation. The scarcity, especially in the Flemish and Brussels regions, the length of the procedures required to obtain a land development permit, the weight of the fees and the low rate of interest on mortgages all contribute to this pressure on prices.
Important differences have been observed between average prices/m² in the three regions, with the Walloon region being considerably less expensive than the other two. The average price in Brussels should be weighted, given the low number of transactions.
For the first three quarters of 2013, the difference between the Flemish and Walloon Regions can be summed up as follows: while the area sold in Wallonia was equivalent to 52% of the total sales, it accounted for only 24% of the total revenues. The remaining 48% of the land sold, which was in the Flemish Region, accounted for 75% of the total revenues.
The number of building permits obtained in 2013 will probably be slightly down on the number obtained in 2012 (24 750 permits granted for 46 802 housing units), but the number of housing units will undoubtedly be of the same order, if not higher, which confirms the trend towards a higher and higher proportion of multiple housing units rather than individual houses. We should not forget that in 2006 the permits granted represented a total of 61 083 housing units.
Demographic growth and the reduction in the size of households will make it necessary to put new residential developments on the market for which plots equipped with utilities will have to be developed.
Plots will increasingly be situated in or close to urban centres or means of transport.
| ×5 |
|---|
| AVERAGE PRICE OF |
| BUILDING PLOTS |
| IN 20 YEARS |
| AVERAGE PRICE/M2 (EUR) |
1992 | 2000 | 2005 | 2011 | 2012 | Q1-Q3 2013 |
|---|---|---|---|---|---|---|
| Flemish Region | 25.63 | 55.06 | 110.76 | 156.51 | 165.76 | 172.83 |
| Brussels Capital Region |
156.27 | 166.91 | 235.04 | 437.37 | 410.95 | 651.34 |
| Walloon Region | 14.06 | 18.27 | 32.50 | 48.74 | 48.95 | 50.41 |
| BELGIUM | 23.42 | 38.54 | 71.27 | 102.57 | 105.15 | 110.39 |
Often they will require the conversion of sites that were previously used for economic or industrial activities.
The regulatory measures adopted or being studied in the three regions of the country corroborate these observations. Adoption of the demographic regional zoning plan, PRAS, (published in the moniteur belge on 29 November and 06 December 2013) in the Brussels Capital Region permits the conversion of zones previously reserved for economic activity into residential zones.
Meanwhile, in the Walloon Region, a complete revision of the urban planning code CWATUPE is expected and it may be replaced by the territorial development code (CoDT). The regional development scheme (SDER) is also expected to be adopted.
In the Flemish Region, it should be noted, there was an important ruling by the Constitutional Court on 07 November 2013 annulling certain measures in the Decree on Land and Building Policy, including the abolition of the obligation to set aside land for social housing in the new permits. A second ruling widens the cancellation of other provisions, inextricably related to the "regulation of social security", included in the Flemish code of Planning.
The office market is a major part of IMMOBEL's development strategy. The Company favours the construction of exemplary buildings that meet the strictest architectural, technical and environmental standards. IMMOBEL has always endeavoured to anticipate new standards and to be a pioneer in its field.
Likewise, the Company is rigorous in its selection of locations, so as to ensure it is present where the development opportunities are greatest, where the communications facilities and the interaction with the urban fabric are optimal. Logically, IMMOBEL has focused most often on central locations, in other words the CBD or equivalent.
Certain projects made a particular mark on IMMOBEL's activity in 2013. These are detailed below. A more comprehensive survey of the various projects under development is available on page 56.
THESE 79 500 M2 OF OFFICES WERE DELIVERED TO THE OCCUPANT, PRE-SOLD, ON 30 DECEMBER 2013
This large and complex project, which is held in partnership, offers a total development potential of about 150 000 m2, to be developed in four phases: 2 lots of offices (including RAC 1) and 2 lots of housing and services, including a school, a nursery and the restoration of the Jardins Péchère, etc.
BELAIR Brussels (City) Studio Arne Quinze - M. & J-M Jaspers - J. Eyers & Partners
79 500 m2 150 000 m2 OF THE COMPLETED BY END 2013 FOR THE BELAIR PROJECT
This first phase of 79 500 m2 was completed and accepted by both the lessee, the Belgian Buildings Agency, and the occupant, the Federal Police, at the end of 2013. The lease, for a term of 18 years, came into effect on 1 January 2014.
Furthermore, a pre-sale agreement for the project was signed mid-2013. SA RAC 1, the owner of the first phase, was sold to Hannover Leasing and its Asian partner, on condition precedent of provisional acceptance both by the occupant and by the purchaser. This final step was completed on 10 March 2014.
Here IMMOBEL and its partner have redeveloped an iconic building in the centre of Brussels (formerly the Cité Administrative de l'Etat), while at the same time creating an essential link between the upper and lower parts of the city, and ensuring that it will eventually fulfil a mixture of purposes, with public areas and collective utilities, shops, offices and housing, the renovation of the Jardins Péchère, and so on.
The building is situated right at the heart of Brussels, at the corner of the rue Montoyer and the rue du Commerce, in the European Quarter, which is without doubt the best office location in Brussels, thanks in particular to the presence of the European institutions, embassies, etc.
BLACK PEARL : 'EXEMPLARY BUILDING 2012', BREEAM 'EXCELLENT' AND PASSIVE BUILDING
BLACK PEARL Brussels (European District) Art & Build
The project consists of the demolition of several existing old and obsolete buildings, and the construction of a new complex of about 11 000 m² that will meet the highest architectural, technical and environmental requirements.
The project's considerable qualities led the Brussels Capital Region to award Black Pearl the "Exemplary Buildings 2012" label. The building is considered to be "passive" and has gained the BREEAM certification "Excellent".
Construction work started in April 2012 and should be finished in Q4 2014. Some 46% of the construction work had been completed by the end of 2013 and the closed shell stage had almost been reached.
GATEWAY
Zaventem
Jaspers-Eyers - A2RC
Situated on the site of Brussels National Airport in Zaventem, the project consists of major renovation and the construction of new buildings on and around the old Terminal 58 to develop approximately 36 000 m² of superior standard offices.
The building has been completely pre-leased by Deloitte for a fixed term of 18 years.
The authorisations and permits have been obtained and construction should start in the course of the second quarter of 2014.
Here IMMOBEL and its partner are engaged in the sustainable conversion, in keeping with the original concept, of a property with a unique location at the heart of an airport, with one facade looking directly onto one of the runways, above a railway station. These new buildings will also feature an outstanding atrium.
Residential development is an essential component of IMMOBEL's business and it has not ceased to grow in importance over the years. Today it is right at the heart of IMMOBEL's development strategy.
LINDEPARK Tervuren M. & J-M Jaspers - J. Eyers & Partners
In line with its stringent requirements in terms of building quality and environmental innovation, the Company is an avant-garde player in the residential sector.
Harmonious integration into the urban fabric or mixed outskirts, the gamble of intergenerational mixing, an architectural approach that is both contemporary and common to the majority of the projects, and anticipation of new environmental standards – all of our projects have to meet a majority of these criteria, which are guarantees of added value. This is how IMMOBEL imposes its vision and its leadership.
Certain projects made a particular mark on IMMOBEL's activity in 2013. These are detailed below. A more comprehensive survey of the various projects under development is available on page 57.
This new residential development, located in the centre of Tervuren, a green town situated to the east of Brussels, involves 60 apartments in two phases: 45 in phase one, 6 of which are destined for the local social housing association, and 15 in phase two.
Work on the first phase is underway and by the end of 2013 the ground floor level had been reached (equivalent to 14% of the work).
During 2013, sales were completed on 38 of the 39 apartments put up for sale in phase one. The sale of the last was signed in early February 2014.
IMMOBEL has made a successful start here on an architecturally and environmentally high-quality development in a green area at the heart of the town centre, close to the shops and main communication routes.
The Bella Vita project, a 50% partnership, is situated in Waterloo, to the south of Brussels, on a site covering 15 ha. Close to the town centre and the station, the location is exceptional. The lively centre of Waterloo, with its shops, cafés, restaurants and banks, is in the immediate vicinity.
This site, a large part of which is classified, is being transformed into an intergenerational residential complex. Besides housing (apartments and houses) the project includes medical or paramedical facilities, a retirement and care home, a day nursery and other local services.
In 2013, sales contracts were signed on 100 of the 269 housing units. The dedicated areas for the retirement and care home and the day clinic were likewise sold in 2013.
By the end of 2013, 20% of the site had been built.
BELLA VITA Waterloo FCM Architects - Baudouin Courtens & Associés
PARC SENY Brussels (Auderghem) A2RC
Here IMMOBEL and its partner have launched an innovative intergenerational concept that is still unique on this scale in Belgium. It will offer a mixture of housing (new or completely renovated) and services of all kinds, and create a whole new district between the station and Waterloo town centre.
The project consists of the transformation of old, obsolete offices into a complex of good-quality housing (121 apartments and two premises for the liberal professions). In Auderghem, set back from the Boulevard du Souverain, the project is in a green environment in the immediate vicinity of Herrmann Debroux metro station.
Some of the offices will not be vacated until the end of 2014. However, applications for permits have been submitted and work is scheduled to start in the first quarter of 2015.
Here IMMOBEL is participating in the conversion of (old) offices into housing in keeping with the neighbourhood in this green area, close to shops, the major communication routes and public transport.
The Charmeraie project is situated in Uccle, in an ideal location in a green setting. It consists of the creation, in three phases, of a new close containing 39 houses and 32 apartments.
Marketing of the first phase (eight houses and a building with 14 apartments) resulted in the completion of sales on five apartments in 2013.
Here IMMOBEL and its partner are creating a new neighbourhood in the centre of Uccle, offering low-energy houses and apartments, in a green area adjacent to a Natura 2000 classified zone.
3 9
This global project consisted of the creation, in three phases, of a new neighbourhood in Woluwe-Saint-Lambert, in the immediate vicinity of the Place Dumon, close to shops, public transport and green areas.
The last phase, a building containing 17 apartments, was finished and completely sold in 2013.
Here IMMOBEL and its partner (20%) have, in the course of a decade, created a new neighbourhood, with 68 single-family houses and four buildings containing a total of 77 apartments in a much sought after residential district.
JARDIN DES SITTELLES Woluwe-Saint-Lambert Trio
Historically IMMOBEL's business was landbanking. The Company has always been active in developing plots of land with excellent potential in good quality environments. This business is in full expansion.
CHASTRE RUE DU CHÊNE Chastre
42 NEW HOUSING UNITS
Attentive to new trends in the market, the company is active in residential extension zones and prioritises proximity to towns, public transport and major communication routes in its choice of sites.
Certain projects made a particular mark on IMMOBEL's activity in 2013. These are detailed below. A more comprehensive survey of the various projects under development is available on page 56.
42 NEW HOUSING UNITS TO BE BUILT SOON
Armed with an extensive portfolio of land in the Province of Walloon Brabant, the Company continued with its projects in Chastre, starting the parcelling up and development of a piece of land measuring 2.75 ha in the immediate vicinity of another landbanking project that was developed by IMMOBEL previously.
The project comprises the creation and equipment with utilities of 24 building plots. Of these, 22 are destined for the construction of detached and semi-detached houses, and two are destined for the construction of apartment buildings.
Work on the utilities has been finished and accepted.
The permit for the first building was granted on 22 January 2014.
Work on the first houses and the two apartment buildings will start in 2014.
Here IMMOBEL is participating in the creation of a new neighbourhood offering a variety of new detached and semi-detached houses and apartments in a highly desirable part of Walloon Brabant.
IMMOBEL is starting a new land development project in the villages of Olne and Soumagne, in the Province of Liège, on a plot of land measuring 3.20 ha.
The project consists of creating and building utilities for 28 building plots destined for the construction of detached and semi-detached houses.
Work on the utilities was completed early in 2014 and has been accepted.
Seven plots have already been sold.
Here IMMOBEL is creating a new land development project offering a range of good-sized plots in a natural, hilly environment, well served by main roads, with small squares and high-quality green areas in a zone with residential status.
68 BUILDING PLOTS DESTINED FOR THE CONSTRUCTION OF TERRACED, SEMI-DETACHED AND DETACHED HOUSES, 17 OF THEM MODERATELY PRICED
GEEL GANSAKKER
The project is located in the town of Geel, in the Province of Antwerp, on a 3.27 ha plot being developed between the Antwerpsedries and Gansakkerstraat.
It consists of creating and equipping 68 building plots destined for the construction of terraced, semi-detached and detached houses, 17 of them moderately priced (affordable housing), and a parcel intended to be used for a building containing ten social apartments.
Sale to private individuals will start once the infrastructure has been completed.
Work to equip the project with utilities should start mid-2014.
Here, in a prize municipality in the province of Antwerp, IMMOBEL will create, in partnership, a large development with a variety of different types of housing.
28 700 m2 OFFICE SPACE 210 RESIDENTIAL UNITS
GREEN HILL Luxembourg City (Dommeldange) CBA - Christian Bauer & Associés Architectes
Dwellers of new green homes are settling in.
In Luxembourg the office market achieved status quo in 2013 with an uptake of 146 000 m², which is more or less the same as in 2012. Once again the banking sector sustained the market with 34% of the total uptake, slightly less than in 2012, when the banks accounted for 37%.
| LUXEMBOURG | 2012 | 2013 | 12 MONTH OUTLOOK |
|---|---|---|---|
| Stock (million m²) | 3.5 | 3.5 | |
| Total uptake (m²) | 145 000 | 146 000 | |
| Availability rate (%) | 6.5% | 5.1% | |
| Deliveries (m²) | 73 000 | 71 000 | |
| Upmarket rents (EUR/m²/month) |
40 | 42 | |
| Investment volume (MEUR) |
567 | 685 | |
| Upmarket yield (%) | 5.75 | 5.75 | |
The phase when the largest financial institutions were bringing all their employees into a limited number of high quality, easily accessible, more energy efficient buildings seems to be behind us now. The big unknown is the impact that the easing of bank secrecy will have on the results of financial institutions established in the Grand Duchy, and therefore on their requirements in terms of office space. In this respect the market is in wait-and-see mode for the moment. Meanwhile, Luxembourg is still welcoming new institutions, such as the China Construction Bank, which will have its offices on the Boulevard Royal in the CBD.
In 2013, the public sector in Luxembourg proved to be much more active than in 2012, with a share of total uptake that went from 2% to 14%. Administrative bodies showed a preference for large, new or renovated premises in easily accessible locations. The European institutions are back again too, with 12% of the uptake compared to 5% in 2012. The main transaction was the lease, by the European Parliament, of 10 076 m² in Kirchberg. This was the biggest transaction by a European institution in the last five years.
One fact worth noting is that because of the low availability of quality premises in the central districts, the demand has shifted to the Decentralised areas, with high availability of good quality properties. In 2013, 28% of the uptake was in Decentralised districts, as opposed to 22% in 2012, and an average of 24% over the last five years. This trend has not yet been observed in the Suburbs.
The low level of speculative deliveries - 14 000 m² in 2013 compared to 27 000 m² in 2012 - and sustained demand have weighed on availability in Luxembourg. At the end of December 2013, the vacancy rate had settled at 5.1%, the lowest level since the end of 2008.
The vacancy rate in the peripherie remains at very high level, around 20-25% depending on the areas.
Upmarket rents continued to increase in 2013, rising from 40 EUR/m²/year to 42 EUR/m²/year in the CBD.
The investment market went up by 21% in 2013, reaching 685 MEUR if transactions involving development and building plots are included, and 589 MEUR if we exclude them. 80% of the transactions involved office buildings, while 18% involved retail, and the remainder building plots.
Belgian and local investors continue to be the most active on the Luxembourg market, with 37% and 33% of the total volume respectively. French investors come next with 22% and then Germans with 5%.
At 5.75% the yield on upmarket offices with standard leases has remained the same as last year. For long-term leases and high-quality properties yields may go down to 5%.
For 2014, we expect a bigger uptake than in 2013, due in particular to the fact that KPMG and PwC will be moving into their new headquarters, located respectively in Kirchberg and at La Cloche d'Or. In the short term the offer remains limited: out of 77 000 m² of expected deliveries in 2014, only 19 000 m² are speculative. Availability should therefore continue to decline during the first half year, although it will increase again between now and the end of the year when KPMG and PwC's present headquarters are put back on the market. Rents for small premises in the CBD are likely to rise again in 2014, while average rents are expected to remain at levels similar to 2013.
Average prices per m² for apartments continued to rise in 2013, both for sales of existing apartments and for off-plan sales.
This increase is most noticeable for small apartments, under 50 m², with a +24% rise between Q3 2012 and Q3 2013, and for large apartments (over 100 m²), with a +15% rise between Q3 2012 and Q3 2013.
The average price, off-plan, in 2013 rose to 5 376 EUR per m²; existing apartments were selling for an average of 4 192 EUR per m².
In the early 2000s IMMOBEL decided to establish itself in the Grand Duchy of Luxembourg, starting initially with its offi ce development business.
GALERIE KONS Luxembourg City M3 Architectes
As in Belgium, the company favours the construction of exemplary buildings that meet the strictest architectural, technical and environmental standards. It is also careful to ensure a rigorous selection of sites, in order to be present where there are development opportunities and where major communication routes and interaction with the urban fabric are optimal.
Bearing in mind the particularities of the market, IMMOBEL is careful to associate with a local partner where necessary.
Certain projects made a particular mark on IMMOBEL's activity in 2013. These are detailed below. A more comprehensive survey of the various projects under development is available on page 56.
Located right in the centre of Luxembourg City, opposite the station, this new multipurpose project is being developed in partnership (33%) and involves 20 500 m² (14 600 m² of offices, 3 500 m² of housing and 2 400 m² of retail).
The redevelopment of the present site will include the almost total demolition of the present buildings. The location is unique, opposite the station, in a neighbourhood that is undergoing radical transformation.
A long-term lease has been signed with ING Bank Luxembourg for 75% of the office space.
Applications for permits were filed in July 2013; work should start in the second quarter of 2014.
Here IMMOBEL and its partners are contributing to the conversion and reconstruction of (old) offices into new, architecturally and environmentally high quality offices at the heart of the city centre, opposite the station and therefore close to public transport and the major communication routes, while preserving the existing multipurpose nature of the complex.
GREEN HILL Luxembourg City (Dommeldange) CBA - Christian Bauer & Associés Architectes
In Luxembourg IMMOBEL is reaping the benefits of the expertise it has gained in the Belgian residential construction market. Local IMMOBEL teams adhere to the company's fundamental business principles: strategic locations, proximity to transport facilities, meticulous construction and finishing. In addition, in order to integrate some of the particularities of the market, IMMOBEL is careful to associate itself, where necessary, with a partner.
The Green Hill project is situated in Dommeldange, a district in the north of Luxembourg City, close to the centre and the Kirchberg Plateau.
IMMOBEL is engaged here in the development, within a 50% partnership and in phases, of 174 high-quality apartments in 14 buildings.
In addition to the sales that had been finalised previously, 57 sales were completed during 2013. By the end of the year only 20 apartments out of 174 were still available.
By the end of 2013 seven buildings out of the 14 had been completed and delivered (i.e. a total of 92 housing units out of the project's 174) and five others were under construction.
Here IMMOBEL and its partner are creating a new neighbourhood with considerable architectural, environmental and technical merit, and excellent visibility on the heights of Luxembourg.
4 9
GREEN HILL Luxembourg City (Dommeldange) CBA - Christian Bauer & Associés Architectes
OKRĄGLAK Poznan Rhode Kellermann Wawrowsky
The thorough renovation of this landmark has been followed by a 3/4 occupancy of the available space.
In Warsaw the market for office properties was marked by sustained demand on the part of occupants for the whole of 2013, with a high level of gross take-up, equivalent to 633 000 m2. This result is 4% higher than the already record volume in 2012.
Figures for net take-up (excluding contract renewals) climbed too, with a volume of transactions equivalent to 451 000 m2 (up 3% on the year before), including nearly 40% in pre-leases.
By the end of 2013, taking into account the numerous new properties on the market (300 000 m², the highest figure since 2000), the vacancy rate reached 11.7% (up considerably compared to the 8.8% at the end of 2012).
The total inventory of modern offices in Warsaw therefore came to 4.1 million m2.
The highest nominal rents in Warsaw remained stable in 2013, varying around 22-25 EUR/m2/ month in the CBD, and approximately 14.50 EUR elsewhere.
In Poznan, the market for office properties is equivalent to a total surface area of 314 500 m2. The rate of availability increased in 2013 and is currently at 14.6% (as opposed to 10.3% at the end of 2012).
The highest nominal rents have remained stable, at around 14 to 15 EUR/m2/month.
Take-up in Poznan in 2013 reached 37 800 m2.
| WARSAW | 2012 | 2013 | 12 MONTH OUTLOOK |
|---|---|---|---|
| Stock (million m²) | 3.9 | 4.1 | |
| Total uptake (m²) | 608 000 | 633 000 | |
| Vacancy rate (%) | 8.8% | 11.7% | |
| Deliveries (m²) | 268 000 | 300 000 | |
| Upmarket rents (EUR/m²/month) |
22-25 | 22-24 |
The volume of office transactions remained stable in 2013, amounting to 0.9 billion EUR. Strong activity observed in the other real estate segments in Poland meant total transactions exceeded the 3 billion EUR threshold. This proves that good-quality real estate products in Poland continue to be sought after by investors.
The highest yields from offices remained stable at between 6.00% and 6.25%. The spread between yields from prime and secondary investments was approximately 125 to 250 base points. Yields should remain at this level in 2014, if not increase.
Despite the economic slowdown and the lack of new developments capable of meeting the demand, 2013 was even better than 2012 in terms of the number of transactions, which surpassed even the historically high level of 2007. In fact, the market was kept buoyant by very low interest rates (in the order of 2.5%) and relatively low sales prices (round 1 900 EUR/m² VAT included).
In 2010 IMMOBEL decided to establish itself long-term in Poland and make its second market there. With the aid of a local team of some fifteen employees, the Company applies the same strategy in Poland as it does in Belgium and Luxembourg.
IMMOBEL invests in urban centres, at the heart of public transport systems and the major communication routes. OKRĄGLAK Poznan Rhode Kellermann Wawrowsky
In Poland there are numerous opportunities to renovate – often obsolete – office buildings. Many possibilities to develop new projects exist too.
IMMOBEL differentiates itself by the high standard of its qualitative construction criteria.
In Poland, as in Luxembourg, IMMOBEL is careful to associate with a local partner, if it is deemed opportune, in order to take into account the particularities of the local market.
Certain projects made a particular mark on IMMOBEL's activity in 2013. These are detailed below. A more comprehensive survey of the various projects under development is available on page 56.
OVER THREE QUARTERS OF THE OFFICES HAVE BEEN LEASED AND ARE OCCUPIED
The Okrąglak project consisted of the thorough renovation of an existing building, which is extremely well situated in the centre of Poznan, between the old city and the central station.
The renovation involved 7 100 m² of offices complemented by 800 m² of business premises.
By the end of 2013, 75% of the building had been leased and occupied.
IMMOBEL launched the development of this building, which is an icon both for the city and for its inhabitants, early in 2011, as part of the geographic expansion decided on in 2010. It is immediately recognisable by its circular form and characteristic staircase.
Early in 2011, IMMOBEL acquired an existing classified building that is particularly well situated, right in the centre of the CBD in Warsaw, for redevelopment as a high-quality multipurpose building with a surface area in the order of 21 200 m² of office and retail space.
The building permit was granted late in 2013. Work should start during 2014.
IMMOBEL launched this project as part of the geographic expansion decided on in 2010. It involves the redevelopment of a listed building that is an icon in the city, including the restoration of the front wing and the construction of a new section, to make this a harmonious architectural complex with high visibility along one of the main arteries in Warsaw.
CBD ONE Warsaw KiR Architects
CEDET Warsaw Rhode Kellermann Wawrowsky & Andrzej M. Choldzynski
In 2013 IMMOBEL acquired, in partnership (50%), a piece of land that is particularly well situated at the very centre of the CBD in Warsaw.
IMMOBEL will construct a high quality building there with a mixture of offices and retail, and a surface area of approximately 18 000 m².
In line with its philosophy, IMMOBEL is keen to develop a new building that meets the latest architectural, technical and environmental criteria right in the centre of the city, where it will have high visibility.
| STATE OF PROGRESS OF PROJECT |
TOWN/CITY | NAME OF PROJECT | STATE OF COMMERCIALISATION AND/OR CONSTRUCTION AT 31-12-13 |
TOTAL AREA, IN '000 M² |
% OUR PARTICIPA TION |
|---|---|---|---|---|---|
| Luxembourg | WestSide Village | 76% of the offices have been leased and occupied |
11.7 | 100% | |
| Built - leased and for sale | Poznan | Okrąglak | 75% of the offices have been leased and occupied |
7.9 | 100% |
| Brussels | Belair (RAC 1) | 100% of the building has been leased | 79.5 | 40% | |
| Construction in progress - | Belair (RAC 2) | Construction work should be completed by the end of 2014 |
9.5 | 40% | |
| for lease and for sale | Brussels | Black Pearl | Construction work should be completed by the end of 2014 |
11.0 | 100% |
| Brussels Tower | The dossier is being studied by potential occupants |
59.6 | 50% | ||
| Files under | Brussels Gateway |
An 18-year lease has been signed with Deloitte for the whole project. The permit was obtained at the end of 2013. Work should start in March 2014 |
36.0 | 50% | |
| development, | Universalis Park | The dossier is under analysis | 43.0 | 50% | |
| various stages of progress |
Luxembourg | Galerie Kons | A long-term lease has been signed with ING Luxembourg for 70% of the project. A permit application has been submitted |
17.0 | 33% |
| Warsaw | Cedet | The permit was obtained at the end of 2013 |
21.2 | 100% | |
| CBD One | The dossier is under analysis | 18.0 | 50% |
| BRUSSELS | WALLONIA | FLANDERS | TOTAL | ||
|---|---|---|---|---|---|
| LAND STOCK AT 31-12-2013 | |||||
| Area, in ha | 3.2 | 70.3 | 3.7 | 77.2 | |
| Under development | Number of projects | 6 | 54 | 5 | 65 |
| Area, in ha | 0.8 | 200.7 | 64.3 | 265.8 | |
| In reserve | Number of projects | 2 | 63 | 13 | 78 |
| Subject to conditions | Area, in ha | - | 62.4 | 5.6 | 68.0 |
| precedent | Number of projects | - | 17 | 3 | 20 |
| ACTIVITY 2013 | |||||
| Acquisitions | Area, in ha | - | 20.8 | 6.2 | 27.0 |
| Sales | Net area, in ha | 0.2 | 13.4 | 0.3 | 13.9 |
| Permits applied for | Area concerned, in ha | 0.6 | 107.7 | 18.3 | 126.6 |
| Area concerned, in ha | 0.6 | 26.4 | 3.1 | 30.1 | |
| Permits obtained | Number of residential units concerned |
75 | 337 | 38 | 450 |
| STATE OF PROGRESS OF PROJECT |
TOWN/CITY | NAME OF PROJECT |
NUMBER OF RESIDENTIAL UNITS |
NUMBER OF COMMERCIAL/ PROFESSIONAL UNITS |
STATE OF COMMERCIALISATION AND/OR CONSTRUCTION |
% OUR PARTICIPATION |
|---|---|---|---|---|---|---|
| Built - sales are | Hôtel Martyrs | 40 | Sales process in progress | 100% | ||
| in progress | Brussels | South City Hotel | 140 | The hotel has been leased to Park Inn | 10% | |
| Etterbeek - Rue P.E. Devroye |
12 | 1 | 7 apartments have been sold already | 33% | ||
| Brussels | Belair RAC3 | 77 | The project is under construction and being commercialised |
40% | ||
| Construction | Charmeraie, phase 1 | 22 | 7 apartments and 1 house have been sold | 80% | ||
| and sales are | Bredene | Duinenzicht | 49 | 24 apartments have been sold | 50% | |
| in progress | Eupen | Zur Alten Brauerei | 25 | 3 | All except 1 apartment and 2 professional units have been sold |
33% |
| Tervuren | Lindepark, phase 1 | 45 | All sold or subject to pre-sales agreement | 100% | ||
| Waterloo | Bella Vita | 269 | Half the residential units have been sold | 50% | ||
| Luxembourg | Green Hill | 174 | All except 9 apartments have been sold | 50% | ||
| Belair RAC4 | 230 | A permit application is in preparation | 40% | |||
| Brussels | Jardins du Nord - Hôpital Français |
79 | The building permit was obtained mid 2013 - work is about to start |
97% | ||
| Etterbeek Residential |
50 | The building permit was obtained late 2013 - work should start mid-2014 |
50% | |||
| Parc Seny | 121 | 2 | The permit application is in preparation | 100% | ||
| Charmeraie, phases 2 and 3 |
48 | The permit application is in preparation | 80% | |||
| Chien Vert | 46 | The permit application is in preparation | 100% | |||
| Universalis Park, Lot 3 phase 3 |
The development permit application is in preparation |
50% | ||||
| Files under analysis, at |
Universalis Park Lot 2 |
860 | The development permit application is in preparation |
50% | ||
| different stages of progress |
Universalis Park Lot 3 Phase 2 |
A 27-year lease has been signed with Armonea (retirement home) on condition that the permit is granted. The permit application is in preparation. |
50% | |||
| Universalis Park Lot 3 Phase 1 |
140 | The building permit application has been submitted |
50% | |||
| Tervuren | Lindepark, phase 2 | 15 | The permit application is in preparation | 100% | ||
| Grez Doiceau |
PPP Gastuche | 220 | The development permit application has been submitted |
50% | ||
| Knokke | Koningslaan | 43 | 2 | The building permit application has been submitted |
50% | |
| Nivelles | Îlot Saint-Roch | 150 | An analysis of possible developments is underway |
100% | ||
| Luxembourg | Galerie Kons | 32 | 1 | The permit application is in preparation | 33% |
Ladies and Gentlemen,
We have great pleasure in presenting our report on the activities of the IMMOBEL Group during 2013.
In a still difficult economic environment, particularly in the real estate segment of offices in Brussels, IMMOBEL ended 2013 with an operating income of 10.6 MEUR, compared to 19.4 MEUR in 2012.
This income generated a net consolidated profit of 1.47 MEUR, compared to 11.7 MEUR in 2012.
Sales for the year ended came to 53.85 MEUR compared to 126.77 MEUR in 2012.
Throughout 2013, IMMOBEL pursued its development plan in the various spheres of activity, Office, Residential and Landbanking, in Belgium, the Grand Duchy of Luxembourg and Poland. It has therefore made several important acquisitions, sales and leases, in accordance with its objectives, as described below:
REPORT - As part of the simplification of the Group structures, Lotinvest, the company in charge of the Group's landbanking activities, was absorbed by IMMOBEL on 11th July 2013.
Following the transfers and leases cited below, sales for the "offices" activity in Belgium reached 8.96 MEUR for the past fiscal year compared to 59.03 MEUR in 2012. The operating income came to -1.95 MEUR in 2013 compared to 4.71 MEUR in 2012.
——————————————
As far as the "residential" activity is concerned sales for the activity reached 17.41 MEUR in Belgium for the past fiscal year as opposed to 18.59 MEUR in 2012. The operating income generated was 4.67 MEUR in 2013 compared to 0.39 MEUR in 2012.
Sales for the "landbanking" activity in Belgium came to 15.11 MEUR for the past fiscal year compared to 11.42 MEUR in 2012.
The operating income generated was 5.30 MEUR as against 2.66 MEUR in 2012
——————————————
As for 2012, the activity "offices" in the Grand Duchy of Luxembourg does not generate any revenue for the last fiscal year. The operating income for the "offices" activity in the Grand Duchy of Luxembourg came to 1.82 MEUR for the past fiscal year (compared to 0.84 MEUR in 2012).
As far as "residential" is concerned, sales figures for the Grand Duchy of Luxembourg came to 9.10 MEUR compared to 16.22 MEUR in 2012. The operating income generated was 1.32 MEUR compared to 2.18 MEUR in 2012.
IMMOBEL has acquired 50% of CBD International, company that owns plots of land situated in the centre of Warsaw (CBD), next to the crossing of Marszałkowska and Świętokrzyska Streets, with a view to develop a project comprising approximately 18 000 m² of office and retail space.
Both plots where part of the successful RUCH portfolio acquisition completed in 2011 (in Joint Venture with Griffin).
IMMOBEL has obtained zoning decisions for:
Concerning the project Cedet situated in Warsaw:
——————————————
The "offices" activity in Poland does not generate any revenue for the last fiscal year (compared to 19.09 MEUR in 2012). The operational result amounted to -0.64 MEUR in 2013 compared to 8.59 MEUR in 2012.
The "residential" activity amounted to a turnover of 3.27 MEUR in Poland during the past fiscal year compared to 2.42 MEUR in 2012. The operating income amounted to 0.05 MEUR.
| (MEUR) | 31-12-2013 | 31-12-2012 |
|---|---|---|
| Operating income | 10.57 | 19.37 |
| Financial result | -9.27 | -6.79 |
| Shares in the income of entities accounted for by the equity method |
0.19 | 0.02 |
| Result before tax | 1.49 | 12.60 |
| Taxes | -0.02 | -0.91 |
| Income from ongoing business | 1.47 | 11.69 |
| Income for the year | 1.47 | 11.69 |
| Group share of income | 1.47 | 11.70 |
| (MEUR) | 31-12-2013 | 31-12-2012 |
|---|---|---|
| Inventories | 464.7 | 359.9 |
| Investments in associates and available for sale | 1.1 | 2.4 |
| Trade receivables and other assets | 29.8 | 28.4 |
| Cash | 31.4 | 26.9 |
| TOTAL ASSETS | 527.0 | 417.6 |
| Shareholder equity | 183.2 | 187.7 |
| Provisions | 2.2 | 2.5 |
| Long-term financial debt | 151.5 | 135.5 |
| Short-term financial debt | 148.8 | 51.8 |
| Trade payables and other liabilities | 41.3 | 40.1 |
| TOTAL EQUITY & LIABILITIES | 527.0 | 417.6 |
The operating profit amounts to 4.35 MEUR for the past financial year compared to 3.86 MEUR for the year closed at 31st December 2012.
The financial result amounts to -1.35 MEUR as opposed to 2.58 MEUR in 2012. This decrease is mainly due to the costs linked to the 60 MEUR bond issue at 5.5% in March 2013.
The exceptional result amounts to 0.51 MEUR compared to 5.15 MEUR en 2012.
IMMOBEL's financial year ended with a net profit of 3.51 MEUR, compared to a net profit of 11.59 MEUR at 31st December 2012.
The Balance sheet total amounts to 365.45 MEUR compared to 270.20 MEUR for the financial year closed at 31st December 2012.
On 31st December 2013 equity came to 192.98 MEUR. It was 189.47 MEUR in 2012.
The profit to be allocated, taking into account the amount carried forward from the previous year, amounts to 122.60 MEUR.
The Board of Directors proposes to the Ordinary General Meeting of 22nd May 2014 not to distribute a gross dividend and to defer the available income of 122.60 MEUR.
The IMMOBEL Group faces the risks and uncertainties inherent to the property development sector as well as those associated with the economic situation and the financial world. Without the list being exhaustive, we would like to mention the following in particular:
Changes in general economic conditions in the markets in which IMMOBEL's properties are located can adversely affect the value of IMMOBEL's property development portfolio, as well as its development policy and, consequently, its growth prospects.
IMMOBEL is exposed to the national and international economic conditions and other events and occurrences that affect the markets in which IMMOBEL's property development portfolio is located: the office property market in Belgium (mainly in Brussels), Luxembourg and Poland; and the residential (apartments and plots) property market (Belgium, Luxembourg and Poland).
This diversification of both business and countries means it can target different clients, economic cycles and sales volumes.
Changes in the principal macroeconomic indicators, a general economic slowdown in Belgium or one or more of IMMOBEL's other markets, or on a global scale, could result in a fall in demand for office buildings or residential property or building plots, higher vacancy rates and higher risk of default of service providers, building contractors, tenants and other counterparties, any of which could materially adversely affect IMMOBEL's value of its property portfolio, and, consequently, its development prospects.
IMMOBEL has spread its portfolio of projects under development or earmarked for development so as to limit the impact of any deterioration in the real estate market by spreading the projects in terms of time and nature.
IMMOBEL's revenues are determined by disposals of real estate projects. Hence, the results of IMMOBEL can fluctuate significantly from year to year depending on the number of projects that can be put up for sale and can be sold in a given year.
Furthermore, it cannot be guaranteed that IMMOBEL will find a buyer for the transfer of its assets or that the transfer price of the assets will reach a given level. IMMOBEL's inability to conclude sales can give rise to significant fluctuations of the results.
The policy of diversification implemented by IMMOBEL for the last 5 years has allowed it to reduce its concentration on and therefore its exposure to offices in Brussels with an increased portfolio of residential and landbanking projects, which should give it a revenue base and regular cash flows.
When considering property development investments, IMMOBEL makes certain estimates as to economic, market and other conditions, including estimates relating to the value or potential value of a property and the potential return on investment.
These estimates may prove to differ from reality, rendering IMMOBEL's strategy inappropriate with consequent negative effects for IMMOBEL's business, results of operations, financial condition and prospects.
IMMOBEL takes a prudent approach to the acquisition and development of new projects and applies precise selection criteria. Each investment follows a clear and strict approval process.
Since 2011 IMMOBEL acquired several offices/residential/commercial projects in Poland, which are either under development or will be developed, thereby confirming its strategy to further expand in in Poland.
Although IMMOBEL has carried out development projects in Poland in the past, it has a more limited experience in managing projects outside of the Belux market and has a more restricted knowledge of the market and regulatory situation and requirements in this new market.
That is the reason why IMMOBEL does not launch itself on a new market until it can count on the expertise and network of a local partner on the spot, who can help it limit the risks linked to the new market.
Before acquiring a new project, IMMOBEL carries out feasibility studies with regard to urban planning, technology, the environment and finance, usually with the help of specialised consultants. Nevertheless these projects are always subject to a variety of risks, each of which could cause late delivery of a project and consequently increase the length of time before it can be sold, engender a budget overrun or cause the loss or decrease of expected income from a project or even, in some cases, its actual termination.
Risks involved in these activities include but are not limited to: (i) delays resulting from amongst other things adverse weather conditions, work disputes, construction process, insolvency of construction contractors, shortages of equipment or construction materials, accidents or unforeseen technical difficulties; (ii) difficulty in acquiring occupancy permits or other approvals required to complete the project; (iii) a refusal by the planning authorities in the countries in which IMMOBEL operates to approve development plans; (iv) demands of planning authorities to modify existing plans; (v) intervention by pressure groups during public consultation procedures or other circumstances; and (vi) upon completion of the development project, occupancy rates, actual income from sale of properties or fair value being lower than forecasted.
Taking into account these risks, IMMOBEL cannot be sure that all its development projects (i) can be completed in the expected timeframe, (ii) can be completed within the expected budgets or (iii) can even be completed at all. It is in the framework of controlling this risk and others that IMMOBEL has increased the diversification of its business/countries/clients, which allows it to reduce its concentration on any particular project or another.
Furthermore IMMOBEL has some projects where an asset under development is pre-leased or pre-sold to a third party and where IMMOBEL could incur substantial liabilities if and when such projects are not completed within the pre-agreed timeline.
IMMOBEL's operations and property development portfolio are subject to various laws and regulations in the countries in which it operates concerning the protection of the environment, including but not limited to regulation of air, soil and water quality, controls of hazardous or toxic substances and guidelines regarding health and safety.
Such laws and regulations may also require IMMOBEL to obtain certain permits or licenses, which it may not be able to obtain in a timely manner or at all. IMMOBEL may be required to pay for clean-up costs (and in specific circumstances, for aftercare costs) for any contaminated property it currently owns or may have owned in the past.
As a property developer, IMMOBEL may also incur fines or other penalties for any lack of environmental compliance and may be liable for remedial costs. In addition, contaminated properties may experience decreases in value.
Loss of its managerial staff and other key personnel or the failure to attract and retain skilled personnel could hamper IMMOBEL's ability to successfully execute its business strategies.
IMMOBEL believes that its performance, success and ability to fulfil its strategic objectives depend on retaining its current executives and members of its managerial staff who are experienced in the markets and business in which IMMOBEL operates. IMMOBEL might find it difficult to recruit suitable employees, both for expanding its operations and for replacing employees who may resign, or recruiting such suitable employees may entail substantial costs both in terms of salaries and other incentive schemes.
The unexpected loss of the services of one or more of these key individuals and any negative market or industry perception arising from such loss could have a material adverse effect on IMMOBEL's business, results of operations, financial condition and prospects.
The conduct of its management teams, in Belgium, Luxembourg and in Poland, is therefore monitored regularly by the CEO and the Remuneration & Appointments Committee (hereafter "RAC"), one of the organs of the Board of Directors.
In the normal course of IMMOBEL's business, legal actions, claims against and by IMMOBEL and its subsidiaries and arbitration proceedings involving IMMOBEL and its subsidiaries may arise. IMMOBEL may be subject to other litigation initiated by sellers or purchasers of properties, tenants, contractors and subcontractors, current or former employees or other third parties.
In particular, IMMOBEL may be subject to warranty claims due to defects in quality or title relating to the leasing and sale of its properties. This liability may apply to defects in properties that were unknown to IMMOBEL but could have, or should have, been revealed.
IMMOBEL may also be subject to claims by purchasers of its properties as a result of representations and warranties about those properties given by IMMOBEL at the time of disposal.
IMMOBEL makes sure to control these risks with a systematic policy of taking out adequate insurance cover.
IMMOBEL is exposed to risk in terms of liquidity and financing which might result from a lack of funds in the event of non-renewal or cancellation of its existing financing contracts or its inability to attract new financing.
IMMOBEL does not initiate the development of a project unless financing for it is assured by both internal and external sources for the estimated duration of its development.
IMMOBEL gets its financing from several first-rate Belgian banking partners with which it has maintained longstanding good relations and mutual trust. During 2013, IMMOBEL renewed or negotiated credit lines for 310 MEUR (100% participation) either alone or with partners, and raised on 19th March 2013 60 MEUR via a bond issue.
Given its current and future indebtedness, IMMOBEL is affected by a short or long-term change in interest rates, by the credit margins taken by the banks and by the other financing conditions.
With the exception of bond issues of 2011 and 2013, which are at a fixed rate, IMMOBEL's financing is mainly provided on the basis of short-term interest rates (based on Euribor rates for 1 to 12 months). In the context of a global programme of risk management coverage, IMMOBEL has set up a "hedging" policy aimed to provide adequate cover against the risk of interest rates on its debt with financial instruments.
Feasibility studies for each project are based on the predictions for long-term rates.
Following its entering in the Polish market, IMMOBEL is subject to currency exchange risks. There is the foreign currency transaction risk and the foreign currency translation risk.
IMMOBEL also makes sure whenever possible to carry out all of its operations outside the Eurozone in EUR, by having purchase, lease and sales contracts drawn up for the most part in EUR.
Any development project depends on obtaining urban planning, subdivision, urban development, building and environmental permits. A delay in granting them or failure to grant them could impact on IMMOBEL's activities.
Furthermore, IMMOBEL has to respect various urban planning regulations. Local authorities or public administrations might embark on a revision and/or modification of these regulations, which could have a material impact on IMMOBEL's activities.
IMMOBEL has contractual relations with multiple parties, such as partners, investors, tenants, contractors, financial institutions, architects. The inability of such counterparty to live up to their contractual obligations could have an impact on IMMOBEL's operational and financial position.
IMMOBEL pays great attention, through appropriate studies, to the choice of its counterparties.
IMMOBEL is active in Belgium, Luxemburg and Poland. Changes in direct or indirect fiscal legislation in any of these could impact IMMOBEL's financial position.
The Board of Directors reminds that the actual transfer of ownership of shares RAC 1 to Hannover Leasing and its partner took place on 10th March 2014.
Since 1st January 2014, to the Directors' knowledge there were no other important events after the closure of the financial year.
To the Directors' knowledge, there should not be any circumstances likely to have any significant influence on the development of the Group.
In as much as it is necessary the Board of Directors reiterates that, given the nature of its business, the Group did not engage in any research and development activities during the year which has just ended.
The Board of Directors confirms that IMMOBEL used financial instruments intended to cover any rise in interest rates. The market value of these financial instruments was -0.47 MEUR at 31st December 2013.
As proposed by the Board of Directors, the Shareholders appointed as Directors Mr Wilfried Verstraete (during the Extraordinary General Meeting on 29th August 2007) and ARSEMA sprl, represented by Mr Didier Bellens, (during the Ordinary General Meeting on 28th May 2009).
These Directors meet all of the criteria of independence in Articles 524 and 526ter of the Companies Code and sit on the Board of Directors and the Audit & Finance Committee of IMMOBEL as independent Directors. These Directors hold university degrees in Economics and Business Administration (MBA) and have held or continue to hold the roles of Chief Executive Officer in international groups.
Mr Maciej Drozd, the present CFO of Eastbridge Group, also has the necessary expertise in accounting and audit.
M. Maciej Drozd, actuel CFO de Eastbridge Group, dispose quant à lui également des compétences requises en matière de comptabilité et d'audit.
In as far as it is necessary, the Board of Directors reiterates:
Regarding the information to be inserted pursuant to art. 96 § 1, 7° of the Companies Code the Board of Directors report:
The Board points out that it applied the procedure foreseen by Articles 523 and 524 of the Companies Code when it took the decision about the possible cancellation of the acquisition of shares of the Company Torres Investment Sp holding the Cedet project in Poland, from Centrum Development & Investment S.à r.l. (affiliate to IMMOBEL, through the reference shareholder of the Group, the Luxembourg company Cresida Investment S.à r.l.).
During 2013, the Committee of Independent Directors met on several occasions (20th, 25th and 27th June, 10th July, 22nd August and 9th September) in order to issue an opinion (cfr. Appendix 1) on the conclusion of the "Amendment N°5" to the initial agreements governing the sale of the shares aiming, in particular:
Based on various reports of the Committee of Independent Directors and the report of the Independent Expert, Jean-François Cats, who assisted the Board of Independent Directors in assessing the possible financial consequences of the operations contemplated for the IMMOBEL Group' proposed decision, the Board of Directors of 10th September 2013 has decided to enter into Amendment N°5 to the initial agreements previously amended.
The Auditor made an assessment of the accuracy of the information in the advice given by the Committee and in the minutes of the Board of Directors (cf. Appendix 2).
The Corporate Governance Statement is part of this Director's report. (cf. page 70 of the Annual Report).
Pursuant to article 34 of the Royal Decree of 14th November 2007 concerning the obligations of issuers of financial instruments admitted for trading on a regulated market, IMMOBEL states that:
I 1° the capital stock is 60 302 318.47 EUR represented by 4 121 987 shares, without any mention of par value, each representing an equal share of the capital stock (art. 4 of the Articles of Association),
I Moreover, during this same General Meeting, you will also have to express an opinion on the reappointment of the Statutory Auditor, civil society under form of a SCRL Deloitte Reviseurs d'Entreprises. It is proposed to renew his mandate as Statutory Auditor for a period of 3 years ending after the Annual General Meeting to be held in 2017 for a fee of 93 900 EUR (excluding fees and disbursements) per year, indexed annually. The Statutory Auditor will be represented by Mr. Laurent Boxus as lead partner.
We therefore ask you to approve the terms of this report and grant discharge to the Members of the Board and the Statutory Auditor.
——————————————
——————————————
Agreed at the Meeting of the Board of Directors on 27th March 2014.
Baron BUYSSE Chairman of the Board
GAËTAN PIRET sprl Managing Director
ADVICE TO THE BOARD OF DIRECTORS OF 10TH SEPTEMBER 2013 REGARDING THE CEDET PROJECT Brussels, 9th September 2013
APPENDIX 1
The Committee of Independent Directors met on 20th, 25th and 27th June 2013, 10th July, 22nd August and 9th September 2013.
The Committee has carefully reviewed the latest memo of the CEO and its annexes (being the Memo from Linklaters and the draft Amendment N°5, as well as the advice of the Independent Expert, being all together the "Documents").
As to the description of the nature of the decision and of the operation on which the Committee has to opine, the Committee referred to the memo of the CEO together with its annexes and it observed that it will have to make a recommendation on the possible follow up of the Cedet Project, and more particularly in view of the three options that are presently open in this respect, i.e. either to go on with the realization of the project on the basis of the initial agreements related thereto, or to exercise the "Unwinding Option" provided by the initial agreements as amended from time to time, or to conclude the Amendment N°5 to the initial agreements.
The Committee observed that the conclusion of the opinion of the Independent Expert is: "As independent expert, I consider that the 3rd Option (approval of the Amendment N°5) is neither of such a nature that it would result in an financial or other "manifestly abusive" damage for the Company, nor should it cause the Company a damage that should be otherwise balanced, particularly taking into account that,
Considering that the building permit has not been obtained, it is not possible to estimate the financial consequences of the entire operation."
On the basis of all the data referred to above, the Committee considered that, from a business point of view, the 3rd Option, i.e. that the Amendment N°5 be concluded, is the better one to be adopted in the best interest of the Company and of all its Shareholders.
It is in particular observed, without prejudice to all other elements resulting from the Documents that the Committee has reviewed, that:
As far as the three specific questions raised in Article 524 of the Belgian Company Code are concerned, the Committee refers to all the financial data presented in the Documents and observes in particular that (i) the IRR Guarantee could result in an economic margin of around 19.4 MEUR, and that, alternatively, the exercise of the new "Unwinding Option", as the case maybe, would result in an increased recovery compared to the application of the existing SPA of an amount of 1.261 MEUR (explained by the fact that the costs recovered are no longer capped at 750 KEUR), being 29.6 MEUR computed on the 4th September 2013.
On the basis of the above, the Committee concluded, referring to the wording of Article 524 of the Belgian Company Code, that neither is the 3rd Option of such a nature that it would result in a damage "manifestly abusive" for the Company, nor should it cause the Company a damage that should be otherwise balanced. For the sake of completeness, it added that (i) should the fact that a IRR of 13% couldn't be reached be considered as a possible damage in the meaning of Article 524 of the Belgian Company Code, such "damage" is adequately balanced by the "IRR Guarantee" as referred to above, and (ii) should the uncertainty that remains about the obtaining of the building permit be considered as a possible cause of damage for the Company in the meaning of Article 524 of the Belgian Company Code more particularly in comparison with the 2nd Option, such "damage" is adequately balanced by the new "Unwinding Option".
Resolution: The Committee recommended that the Board decides that the Amendment N°5 has to be accepted and concluded, together with its schedules, provided that all documents are signed by CDI and Eastbridge tomorrow before the Meeting of IMMOBEL's Board of Directors.
Marek Modecki Independent Director
Laurent Wasteels Independent Director
Wilfried Verstraete Independent Director
ARSEMA sprl represented by Mr. Didier Bellens Chairman of the Committee
To the board of directors,
Pursuant to a "Preliminary share purchase agreement" and an "Amendment to the preliminary share purchase agreement and a share purchase agreement" (hereafter jointly referred to as the "Share Purchase Agreement") concluded respectively on 21 December 2010 and 2 February 2011 by and between (i) Centrum Development and Investments Sàrl (hereafter the "Seller" or "CDI"), a company governed by the laws of Luxembourg and a related party entity of Cresida Investment Sàrl, a company governed by the laws of Luxembourg and reference shareholder of Compagnie Immobilière de Belgique SA (hereafter "Immobel" or the "Company"), and (ii) Torres Investment Sp.Z.o.o. (hereafter the "Purchaser" or "Torres"), a company governed by the laws of Poland and wholly owned by Immobel, and (iii) Immobel (acting as guarantor of the Purchaser's obligations), Torres purchased from CDI all the shares in the company governed by the laws of Poland Cedet Sp.Z.o.o. (hereafter "Cedet"). Cedet owns a real estate development project (office and retail) in Warsaw (Poland).
The Share Purchase Agreement, as amended from time to time based on discussions between CDI, Torres and Immobel, provides Torres with an unwinding option allowing it to sell all the shares in Cedet back to CDI if the building permit (as defined in the initial Share Purchase Agreement) is not obtained on or before a date defined in the Share Purchase Agreement as amended from time to time.
Since the building permit was not obtained on the defined date, Torres was in a position to exercise the unwinding option.
In the context of the potential exercise of this unwinding option (hereafter the "Transaction"), our assessment is required in accordance with the requirements of article 524 of the Companies Code with respect to the faithfulness of the data included in the advice dated 9 September 2013 of the committee of the independent directors, and in the minutes of the meeting of the board of directors held on 10 September 2013. This assessment will be attached to the minutes of the said board of directors and will be included in the directors' report.
This assessment follows the other assessments we have previously issued on 25 September 2013 with respect to the decisions taken by the board of directors on 26 and 27 June 2013, and on 11 July 2013. These assessments confirmed the faithfulness of the data included in the advices of the committee of the independent directors, and in the minutes of the meetings of the board of directors.
In the frame of our mission, we have performed the following procedures:
Based on our procedures, our findings are as follows:
Our report can only be used in the frame of the above described transaction and cannot be used for other purposes. This report relates only to the financial data mentioned here above, excluding any other data whatever its nature.
Diegem, 25 September 2013
The statutory auditor
BV o.v.v.e. CVBA / SC s.f.d. SCRL Represented by Laurent Boxus
Deloitte Bedrijfsrevisoren / Reviseurs d'Entreprises Société civile sous forme d'une société coopérative à responsabilité limitée Siège social: Berkenlaan 8b, B-1831 Diegem TVA BE 0429.053.863 - RPM Bruxelles - IBAN BE 17 2300 0465 6121 - BIC GEBABEBB
Member of Deloitte Touche Tohmatsu Limited
IMMOBEL adheres to the principles of corporate governance contained in the Belgian Corporate Governance Code published on 12 March 2009 (hereafter Code 2009), which is available on the GUBERNA website: www.guberna.be.
IMMOBEL believes that its Corporate Governance Charter and the present Corporate Governance Statement reflect both the spirit and the rules of the Belgian Corporate Governance Code.
The Corporate Governance Charter describes in detail the structure of the Company's governance and its policies and procedures in matters of governance. This Charter can be consulted on the Company's website: www.immobel.be.
This section of the Annual Financial Report contains information concerning the way IMMOBEL put the principles of governance into practice during the past year.
The "curriculum vitae" of each Director (or of its permanent representative) can be summarized as follows:
CMG CBE, 68, following an international career in London, where he was an Executive Director of BTR Ltd and Chief Executive Offi cer of Vickers Ltd, he is currently Chairman of Bekaert, a Bel20 company. It was he who initiated the Buysse Code on Corporate Governance for companies that are not listed on the stock market. He is also Director or Chairman of other organizations.
55, holds a Master's degree in Business Engineering from the ULB. He is PMD 1989 of the Harvard Business School, a Fellow Member of the Royal Institution of Chartered Surveyors (FRICS) and a Member of IPI. He joined the Compagnie Immobilière de Belgique in 1992 and has been Managing Director since 29 June 2007. In addition, he is, amongst other things, a Director of SITQ Les Tours SA (Caisse de Dépôt et Placement du Québec) and UPSI (Union Professionnelle du Secteur Immobilier).
58, has a degree in Economics and Business Administration from the ULB (Solvay Business School). He is a Member of the International Committee of NYSE. He was previously the CEO of the RTL Group and Managing Director of GBL (Groupe Bruxelles Lambert), as well as Managing Director of Belgacom for 10 years.
49, obtained degrees from the Faculty of Philosophy and Sociology and the Faculty of Management of Warsaw University. He also has an MBA from the University of Illinois in Urbana-Champaign. He joined Eastbridge in 1995. Since June 2009, he has been a Director and the CFO of Eastbridge Group and a Member of the Supervisory Board of EM&F Group. Since 2002, he has been a Member of the Board of Directors and CFO of the Commercial Real Estate department of the Eastbridge Group. Previously he worked as CFO in various companies in Poland.
55, has been active in real estate – predominantly in residential property, retail and offices – since 1985. Alone or in partnership (with Interparking and the Brussels Regional Development Agency (SDRB), amongst others), he has simultaneously initiated, developed and managed multiple successful ventures both in Belgium and internationally, especially in Central Europe and the US. Since 1992 he has been one of the initiators and developers involved in the conversion of landmark office buildings into residential projects in the financial district of Manhattan, New York. He was a shareholder and Member of the Supervisory Board of Eastbridge between 1994 and 2013.
50, has degrees in Information Technology and Business Administration from the Universities of Warsaw and Stuttgart. He joined Eastbridge in 1994. He currently holds the post of CEO of the Eastbridge Group and Chairman of the EM&F Group. He is in charge of the group's growth strategy, management of its operations in Europe and the United States, and relations with its business partners and investors. He has previously worked for consulting companies in Europe and the United States. He is a Member of the Polish Business Circle, the Polish-German Chamber of Commerce and the Association of Germans in Poland.
55, holds a Master in Law from the University of Warsaw. He also studied International Law at the Max Planck Institute and Law at the University of Hamburg. He is currently Managing Partner at 21Concordia, an investment firm in Private Equity located in Warsaw, with offices in Paris and Milan. In 2006-2008 he worked as a Senior Banker for Concordia Espirito Santo Investment, a joint venture between Concordia and the Portuguese group Espirito Santo Group. He is currently a Member of the Supervisory Board of Pegas Nonwovens Ltd (Czech Republic) and Empik M&F SA.
58, supplemented his Master at the ISG business school with an MBA from Harvard Business School in 1982. Since 1978, he has been the cofounder and CEO of Celio, the number 1 in Europe for men's ready-to-wear fashion, which has 1 600 shops in 65 countries. Since 2006, he has been a majority shareholder of the women's ready-to-wear fashion label, Jennyfer. He is also a Member of the Supervisory Board of Eastbridge and Director of Bata Shoes.
55, studied Economics at the VUB (Brussels) and obtained a Master in Financial Management from VLEKHO in Brussels. He also completed the IEP programme at INSEAD. He is currently Chairman of the Board of Management of the Euler Hermes Group, Member of the Allianz Group, which he joined in 2007 as CFO of Allianz Global Corporate & Specialty. He was Chairman of the Board of Management of the Dutch credit insurance company Atradius NV from May 2004 till October 2006. From 1996 till 2004 he was CFO successively of Mobistar, Wanadoo and Orange, all of which are part of the France Télécom Group.
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58, obtained a Master in Economic and Social Sciences (FNDP Namur) in 1981. He also followed the Entrepreneurial Management programme at the University of Boston. He is currently Director of the Compagnie Européenne de Constructions Immobilières SA and Manager of Antibes Investissements Sàrl. He also holds two public mandates in Monaco: he is Economic and Social Advisor to the Government of the Princedom of Monaco and Honorary Consul of the Kingdom of Belgium in Monaco.
| NAME | FUNCTION | DATE FIRST APPOINTMENT |
END MANDATE |
PROFESSIONAL ADDRESS |
|---|---|---|---|---|
| Baron BUYSSE |
Chairman of the Board (Independent) |
13 November 2007 |
2016 | c/o Bekaert SA Diamant Building Boulevard Auguste Reyers 80 1030 Bruxelles |
| Gaëtan PIRET1 |
Managing Director |
10 May 1995 | 2015 Rue de la Régence 58 1000 Bruxelles |
|
| Didier BELLENS2 |
Director (Independent) |
29 August 2007 |
2015 | c/o Arsema sprl avenue Louis Vercauteren 25 1160 Bruxelles |
| Maciej DROZD |
Director | 8 September 2010 |
2013 | c/o Eastbridge Group, c/o Global Asset Management Sp. z o.o. 104/122 Marszalkowska Street PL-00-017 Warsaw (Pologne) |
| Dany DWEK3 |
Director | 24 May 2012 | 20163 | c/o Eastbridge Group, c/o Global Asset Management Sp. z o.o. 104/122 Marszalkowska Street PL-00-017 Warsaw (Pologne) |
| Maciej DYJAS |
Director | 8 September 2010 |
2014 | c/o Eastbridge Group, c/o Global Asset Management Sp. z o.o. 104/122 Marszalkowska Street PL-00-017 Warsaw (Pologne) |
| Marc GROSMAN |
Director | 8 September 2010 |
2014 | c/o Celio International SA South Center Titanium Place Marcel Broodthaers 8b2 1060 Bruxelles |
| Marek MODECKI |
Director (Independent) |
8 September 2010 |
2015 | c/o Concordia Sp. z o.o. Aleje Jerzolimskie 65/79 PL-00-697 Warsaw (Pologne) |
| Wilfried VERSTRAETE |
Director (Independent) |
29 August 2007 |
2015 | c/o Euler Hermes SA 1 Place des Saisons, F-92048 Paris-la-Défense-Cedex (France) |
| Laurent WASTEELS |
Director (Independent) |
8 September 2010 |
2015 | c/o Wasteels S.à r.l. 5 allée Guillaume Apollinaire MC-98000 Monaco |
In carrying out the functions concerned in the present report, Mr Gaëtan PIRET acts as the permanent representative of the company GAETAN PIRET sprl.
In carrying out the functions concerned in the present report, Mr Didier BELLENS acts as the permanent representative of the company ARSEMA sprl.
Has resigned as from 23rd December 2013.
Pursuant to article 18 of the Articles of Association, the Board shall be convened by the Chairman of the Board of Directors, the Managing Director or two Directors.
In principle the Board meets at least three times a year (in March, August and December). Additional meetings may be organized at any time, with reasonable notice. This frequency enables the Directors, among other things, to review the half-yearly accounts in August and the annual accounts in March, as well as the budgets in December. In 2013, the Board met on eleven occasions.
The Board of Directors of IMMOBEL will focus on gender diversity as of 2014 over the next few years, as the law won't apply to the Board until 1 January 2017 at the earliest or even later, in 2019. For this purpose, a Committee already met in 2012. In this context, during the extraordinary Meeting taking place on 14th January 2014, the Board of Directors proposed to Mrs. Davina Bruckner to become a Director.
The Audit & Finance Committee (hereafter "AFC") assists the Board of Directors mainly in, on the one hand, monitoring financial reports and financial information intended for Shareholders and third parties, as well as the quality of internal control and risk management, and on the other hand, following up on the auditor's work, and monitoring the Company's accounts department and finances.
The AFC is made up of at least three Directors who do not have executive responsibilities within IMMOBEL; a majority of the Members of this Committee are independent and at least one Member is competent in accounting and auditing matters.
The Members of the AFC and its Chairman are appointed by the Board of Directors for a maximum duration of four years.
Wilfried VERSTRAETE, Chairman, Didier BELLENS and Maciej DROZD, Members.
In 2013, the AFC met four times at the request of its Chairman.
The main mission of the Remuneration & Appointments Committee (hereafter "RAC") is to make proposals to the Board of Directors concerning remuneration (elements of the remuneration of the Directors, the Members of the Management and Executive Committees, the managers and people in charge of day-to-day management; policy on employee share ownership, etc.) and concerning appointments (appointment or re-election of the Members of the Committees etc.). In application of the Law on Corporate Governance of 6 April 2010, the RAC draws up the Remuneration Report which the Board includes in the Statement on Corporate Governance, which will be discussed during the Annual General Meeting (see infra p. 80).
The RAC is made up of only non-executive Directors, a majority of whom are independent Directors and have the necessary expertise in remuneration policy.
The Managing Director takes part in the meetings of the RAC with an advisory vote when this Committee treats the remuneration of the other Directors, the other Members of the Management Committee and the other Members of the Executive Committee.
The Members of the RAC and its Chairman are appointed by the Board of Directors for a maximum duration of four years.
Didier BELLENS, Chairman, Dany DWEK4, Marek MODECKI and Laurent WASTEELS, Members.
In 2013, the RAC met two times at the request of its Chairman.
The Investment & Asset Management Committee (hereafter "IAMC") assists the Board of Directors in the strategic management of all of IMMOBEL's assets that are valued in excess of 5 MEUR. It also helps it to identify and understand the strategic challenges posed by potential new real estate projects valued in excess of 5 MEUR.
The IAMC is made up of at least three Directors, including the Managing Director.
The Members of the IAMC are appointed by the Board of Directors for a maximum duration of four years. The Managing Director is the Chairman of the IAMC
Gaëtan PIRET, Chairman, Dany DWEK5, Maciej DYJAS, Marc GROSMAN and Wilfried VERSTRAETE, Members.
In 2013, the IAMC met four times at the request of its Chairman.
Pursuant to the articles 523 and 524 of the Belgian Companies Code, a Committee of Independent Directors (hereafter mentioned "CID") has met in order to give advice upon the decision of the eventual unwinding of the acquisition of the shares of the company Torres Investment Sp. z.o.o. owning the Cedet project in Poland.
Didier BELLENS, Chairman Marek MODECKI, Wilfried VERSTRAETE and Laurent WASTEELS.
Baron Buysse and Gaëtan Piret were invited to take part on some particular IMMOBEL Meetings of this Committee.
The Committee was assisted, a.o. by Jean-François Cats, Company Auditor, in its decision on the possible financial consequences of the proposed decision for the IMMOBEL Group.
In 2013, the CID has met six times, upon convening notice of the Chairman.
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The main roles of the Management Committee are:
Gaëtan PIRET, Chairman, Philippe HELLEPUTTE, Christian KARKAN and Philippe OPSOMER, Members.
The Members of the Management Committee are not related to each other.
In 2013, the Management Committee met four times at the request of its Chairman.
The curriculum vitae of the Members of the Management Committee can be summarized as follows:
62, joined IMMOBEL in 1977 as legal Advisor, after having worked 2 years for Coopers & Lybrand. He is, since 1984, responsible of the landbanking activities of the Group, Managing Director of Lotinvest Development, Director of various subsidiaries of IMMO-BEL Group and Member of the Executive Committee since 1987. He holds a Master in Law (UCL), is Member of the IPI and General Counsel of the UPSI (Union Professionnelle du Secteur Immobilier).
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50, Member of IPI and RICS, joined IMMOBEL as Head of Development in 2009. He started his career in 1986 when he joined Healey & Baker (now Cushman & Wakefield) as property agent specialised in offices, lettings and investments. From 1989 until 1993, he was in charge of real estate projects at Fibelaf. In 1995 he became an Associate of Cushman & Wakefield and Equity Partner in 2000 when he accepted the position of Head of the investment team. He studied Marketing at EPHEC (Ecole Pratique des Hautes Etudes Commerciales) and has a degree in Corporate Management.
51, joined IMMOBEL as CFO. After a career start in the banking sector, he joined Nestlé Belgium in April 1989 where he spent 9 years (in the Finance, Audit, IT and Logistics departments). In November 1997, he joined Econocom in Belux, where he spent 10 years in senior management jobs, in Belux & France, in Finance, Operations and IT. He left Econocom in November 2007 (being at that time CFO, Products & Services Benelux). He holds a Master's degree in Business Engineering (Solvay Business School 1987).
The role of the Executive Committee is to introduce efficient systems of internal control and risk management as well as to ensure the day-to-day management of operations. It draws up and implements the policies of IMMOBEL the Managing Director esteems to be of the competences of the Executive Committee.
Under the responsibility of the Managing Director, he:
Gaëtan PIRET, Chairman, Pierre DELHAISE1, Bartlomiej HOFMAN2, Philippe HELLEPUTTE3, Christian KARKAN4, Sophie LAMBRIGHS5, Jean-Louis MAZY6, Joëlle MICHA7, Paul MUYLDERMANS8 and Philippe OPSOMER9, Members.
The Members of the Executive Committee are not related to each other.
The curriculum vitae of the Members of the Executive Committee can be summarized as follows:
63, joined IMMOBEL in 1984 as Legal Counsel after having worked for the office of Notary Marc Bernaerts in Brussels for 7 years, since the creation of the Institute. He is currently Head of Legal Services of IMMOBEL and a Member of the Association of the Company Lawyers. He holds a Master in Law (RUG), a Master in Notary Law (VUB) and a Master in European Law (ULB). He also holds a Common law certificate from St. Catherine's College (Cambridge).
42, joined IMMOBEL in January 2013 as an Advisor and Member of the Executive Committee. She started her career in the building trade, where she held several positions both in Brussels and Paris, involving the design of buildings and works of art. In 2003 she joined the real estate department of Axa Belgium, initially as a Project Manager and later as an Investment Manager. She was also a Director of the real estate investment trust, Retail Estates, and a Member of the Investment Committee of Home Invest. She holds a Master's Degree in Civil Engineering (Construction) from the ULB and obtained an Executive Master in Management from Solvay Brussels School.
43, joined the Group in 2000 as Company Secretary of the real estate investment trust Cibix. Since 2007, she is Head of Corporate Affairs and Compliance Officer of IMMOBEL. Prior she worked as a Lawyer for Loeff Claeys Verbeke (currently Allen & Overy), as an authorised agent in a private bank, and at the FSMA (formerly BFIC) in the Markets Supervision department. She holds a Master in Law (UCL), a Master in Taxation (HEC-Liège) and she also obtained the "Certified European Financial Analyst" qualification (ABAF). She is a Company Director in Belgium and the Grand Duchy of Luxembourg.
39, joined the Group in 2011 as head of our Polish subsidiary (Head of IMMOBEL Poland) and is member of the RICS. Prior to joining IMMOBEL, he has worked, since 1999, for Knight Frank and DTZ, specializing in the office sector, and from 2005, he has worked for Austrian based investment fund Europolis. He holds a Master degree from Warsaw University in International Relations and a Postgraduate degree in Property Valuation from Warsaw Technical University.
57, joined IMMOBEL in 2001 as internal Consultant and afterwards as Member of the Executive Committee. Prior to this, he was a Member of the Executive Committee of the real estate investment trust Cibix (1999-2001). He began his professional career as Inspector General of Finance (1979-1996) and was CFO of the P&V Group (from 1990 till 1997). He holds a Master's degree in Economics (ULB) and an Advanced Management Program (Harvard Business School).
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58, joined IMMOBEL in 2002 as Head of Project Management. He was previously Commercial Director at Valens (Eiffage group). He holds a degree in Civil Engineering (KUL) and a Postgraduate from the RUG. He is AMP 1997 from Insead and Member of the Royal Institution of Chartered Surveyors (MRICS).
The Belgian legislative framework for internal controls and risk management consists in the Law of 17 December 2008 (in application of the European Directive 2006/43 concerning corporate financial control), the Belgian Corporate Governance Code 2009 and Law of 6 April 2010 (CG Law).
The IFRS 7 likewise defines additional requirements with regards to management of risks related to financial instruments.
Nevertheless, the current Belgian legislative and normative framework specify neither the model of internal control to which the companies for which it is intended should conform, nor the modalities for implementing it (level of detail required).
IMMOBEL uses a system of risk management and internal control that was drawn up internally based on the "COSO" model of internal control.
The COSO methodology is organized around five elements:
I the internal control environment,
I risk analysis,
I control activities,
I information and communication, as well as, I supervision and monitoring.
The element "internal control environment" focuses on the following components:
IMMOBEL is a leading Belgian listed company active in the real estate business and more specifically in the offices, residential and landbanking sectors as well as in function of the opportunities retail/commercial. IMMOBEL's objective is to ensure a diversification of its project portfolio via these sectors and to design, manage and promote real estate projects that create long-term value, while respecting the environment and integrating corporate social responsibility.
IMMOBEL has a Board of Directors, an IAMC, an AFC, an RAC, an Executive Committee and a Management Committee.
Responsibility for drawing up IMMOBEL's strategy and for controlling the way it does business belongs primarily to the Board of Directors. The main responsibilities of the different Committees have been mentioned above (cfr. Decision-making bodies).
IMMOBEL takes a prudent attitude, managing a portfolio of diversified projects that create long-term value through its three lines of activity.
IMMOBEL has a Good Behaviour Code that describes the principles of ethics and integrity that apply to each of the Directors and the Members of the Management and Executive Committees as well as all the employees and external collaborators. This Code deals with aspects of conflict of interest, professional secrecy, the buying and selling of shares, corruption and misuse of corporate funds, business gifts and even human dignity. The position of Compliance Officer has been created.
IMMOBEL regularly carries out risk identification and evaluation exercises. The risks are mapped out and formal action plans are drawn up to deal with those risks for which the level of control is deemed to be inadequate. The AFC monitors the implementation of these action plans.
The principle risks to which IMMOBEL is exposed are set out in detail in section I.B of the Directors' Report.
The control activities correspond to the regulations and procedures used to deal with the principal risks identified. Amongst the main regulations and proce dures established within IMMOBEL, we would like to mention the following:
IMMOBEL uses the software program Navision as its financial management information system, of which the maintenance and development are subcontracted to a partner.
Data continuity is also subcontracted to a partner who is contractually bound to follow a strict proce dure to establish a reliable and secure information storage system.
For the large majority of entities in the IMMOBEL Group accounting is outsourced to a firm special ised in financial services. The accounts are kept in IMMOBEL's ERP, the integrated management soft ware program Navision. The finance department of IMMOBEL is always in charge of the closure process and drafting the Annual Report, the Consolidated Financial Statements drawn up according to IFRS standards and the Annual Accounts. Communica tion with the personnel and the various employees of IMMOBEL is appropriate to the size of the business. It is based mainly on work sessions, verbal commu nications from the management to the personnel as a whole, or internal e-mail notes signed mostly by the Managing Director.
In order to ensure rapid communication and equal treatment of all Shareholders, IMMOBEL publishes the Agenda and the minutes of the Annual General Meetings, the half-yearly and annual financial results, press releases, the Articles of Association, the Cor porate Governance Charter and the Annual Report on its website. Certain information is also published in the press.
The AFC is responsible for supervising internal con trol. Given the size and the activities of the Company and the Group, the AFC does not consider it neces sary to create the position of internal auditor to assist it in this mission.
In order to evaluate the control environment regularly, the AFC entrusts the auditor with certain specific mis sions involving more thorough examination of internal control, consisting of testing the existing controls and identifying possible weaknesses compared to best practice. The AFC ensures that the recommendations are implemented if the need arises.
Should the nature and size of the Group's activities change, the AFC would re-examine the need to get an internal auditor.
7 7
TRANSACTIONS AND OTHER CONTRACTUAL RELATIONSHIPS BETWEEN THE COMPANY, INCLUDING ASSOCIATED COMPANIES, WITH THE DIRECTORS, THE MEMBERS OF THE MANAGEMENT COMMITTEE, THE MEMBERS OF THE EXECUTIVE COMMITTEE AND THE OTHER STAFF
During 2013, the Directors have used the procedure in cases of conflict of interest, as laid down by Articles 523 and 524 of the Companies Code and described in the Corporate Governance Charter, within the framework of deliberation on the possible cancella tion of the sale of shares of the company owning the Cedet building ("Unwinding option").
There has also been a transaction between a staff member of the Group and the company IMMOBEL.
Application of the rules cited above has not given rise to any difficulty.
In its Code of Good Conduct the Corporate Governance Charter provides rules intended to prevent the abuse of the market, which are applicable to Directors, to de facto managers, and to any other person liable to possess privileged information because of his/her involvement in the preparations for a particular operation.
These rules have been supplemented by an internal note summarizing the main legal obligations in this matter, particularly taking into account the Royal Decree of 5 March 2006 on abuse of the market, with a view to increasing an awareness of their obligations in those concerned.
The Compliance Officer is tasked with ensuring compliance with said rules in order to reduce the risk of abuse of the market by insider trading. The Compliance Officer keeps lists of people who have or are liable to have privileged information and who know or cannot reasonably be unaware of the privileged nature of this information.
When these people consider carrying out operations involving financial instruments issued by IMMOBEL, they must give the Compliance Officer prior notice in writing or by email of their intention to carry out this operation. Within 5 working days of reception of this prior notice the Compliance Officer will inform the persons concerned whether there is any reason to think that the operation under consideration constitutes insider trading. Should that be the case, it would be inadvisable to carry out the operation. These persons must notify the FSMA of any operations carried out on their own behalf and involving Company shares within five working days of the operation concerned being performed, this notification can be deferred, however, in conformity with the law, as long as the total sum of the operations carried out during the calendar year in progress does not exceed the threshold of 5 000 EUR.
During these so-called "closed" periods, it is forbidden for these people to carry out operations involving IMMOBEL's financial instruments.
During the past financial year the job of Compliance Officer at IMMOBEL was carried out by Mrs Joëlle Micha, Head of Corporate Affairs.
Application of the rules cited above has not given rise to any difficulty.
The Board of Directors of IMMOBEL assesses that no governmental, legal or arbitration proceeding exists that may have, or have had in the recent past, significant effects on the Company and that the Company is not aware of proceedings which are pending that could cause these governmental, legal or arbitration proceedings.
| 31 DECEMBER 2013 | NUMBER | VOTING RIGHTS RELATED THERE TO |
|---|---|---|
| Ordinary shares | 4 121 987 | 4 121 987 |
In application of article 29 of the Law of 2 May 2007 on the disclosure of shareholding in issuers whose shares are admitted to trading on a regulated market, IMMOBEL has been informed by the following Shareholders that they hold the following shares (17th October 2013):
| SHAREHOLDERS | VOTING RIGHTS | % OF TOTAL SHARES |
|---|---|---|
| CRESIDA INVESTMENT S.à r.l. having its registered seat at L-1469 Luxembourg, rue Ermesinde 67 |
1 230 398 | 29.85% |
| CAPFI DELEN ASSET MANAGEMENT NV having its registered seat at 2020 Antwerp, Jan Van Rijswijcklaan 178 |
208 516 | 5.06% |
The General Meeting of Shareholders of 23rd May 2013 authorized the Board of Directors to increase the Company's capital by a maximum amount of 50 000 000 EUR, in one or more occasions, dates and manner to be determined by the Board of Directors, and for a term of five years from the publication of this authorization in the Belgian Official Gazette.
The Company may acquire or take as security its own shares under the conditions determined by the law. The Board of Directors is authorized to sell, on the stock exchange or outside, at the conditions it determines, without prior authorization of the General Meeting, in accordance with the law.
By decision of the Extraordinary General Meeting of Shareholders of 13 April 2011 the Board of Directors is authorized, for a term of 3 years dating from said Extraordinary General Meeting, to purchase or dispose of shares in the company when this purchase or disposal is necessary to prevent any serious imminent harm. This authorization is granted for a period of three (3) years dating from publication of this authorization in the Annexes to the Belgian Official Gazette. Such authorization shall also be valid for the acquisition or the alienation of shares of the Company by a direct subsidiary according to article 627 of the BCC. The Board of Directors has full powers to cancel the shares acquired by the company in this way, to have the cancelation certified by notarial act and to amend and coordinate the Articles of Association to bring them into line with the decisions taken.
Furthermore, by decision of the Extraordinary General Meeting of 13 April 2011, the Board of Directors is authorized to acquire shares of the Company to a maximum of twenty percent (20%) of the issued shares at a price which will not be less than ten (10) EUR nor more than twenty percent (20%) during the highest closing of the last twenty trading days of the Company shares on Euronext Brussels before the acquisition. This authorization is granted for a period of five (5) years from the date of the Extraordinary General Meeting of 13 April 2011. This authorization also applies to the acquisition of shares of the Company by a direct subsidiary according to article 627 of the BCC.
The Board of Directors has full powers to cancel the shares acquired by the company in this way, to have the cancelation certified by notarial act and to amend and coordinate the Articles of Association to bring them into line with the decisions taken.
The rules governing the appointment and replacement of Directors and the amendment of the Articles of Association shall be those provided by the Companies Code, as well as by the Corporate Governance Charter of IMMOBEL.
The terms of change of control contained in credit agreements with financial institutions were approved by the General Meeting of 23rd May 2013, pursuant to section 556 of the Companies Act.
The Statutory Auditor is Deloitte Reviseurs d'Entreprises, represented by Mr Laurent Boxus, which has its registered seat at 1831 Diegem, Berkenlaan 8B. The fixed fees payable to the Statutory Auditor Deloitte for examination and review of the Statutory and Consolidated
Accounts of IMMOBEL amounted to 93 900 EUR (excluding VAT). His fee for the revision of the statutory accounts of subsidiaries came to 91 100 EUR (excluding VAT).
Fortis Banque is the Central Paying Agent of Immobel for an indefinite period. The remuneration of the commission is calculated as follows:
8 0
In 2013, the Company implemented the remuneration policy for the Directors described in Appendix 2 to the regulation of the Board of Directors, and in point I.2.8. of the Corporate Governance Charter available on the Company's website (www.immobel.be).
The level and structure of the remuneration of the non-executive Directors are determined on the basis of their general and specific responsibilities and market practice (and more specifically in other listed companies). This remuneration includes a basic remuneration for Membership of the Board and an additional remuneration for the participation in the meetings or for each Chairmanship of a Committee or of the Board. Non-executive Directors receive no performance related remuneration, nor any benefits in kind, nor benefits linked to pension plans, nor an annual bonus, nor share options, nor participation in retirement plans. They are not entitled to any kind of compensation when their mandate comes to an end.
Remuneration of the non-executive Directors also takes into account the time they devote to their functions.
The Executive Directors' mandates as Member of the Board may likewise be remunerated. In this case, the remuneration is taken into account in the global framework of remuneration paid to executive Directors for the executive functions they hold within IMMOBEL, in accordance with the remuneration policy for Directors and for the Management Committee.
No changes were made to the remuneration policy in 2013.
In 2013, the Company implemented the remuneration policy for the Members of the Management Committee as described in point III.4 of the Corporate Governance Charter on the Company's Internet website (www.immobel.be).
The Board of Directors approves the appointment contracts of the Members of the Management Committee and decides on their remuneration, based on the recommendations of the RAC, following a proposal by the Managing Director.
The level and structure of remuneration for the Members of the Management Committee at IMMOBEL are reviewed annually, and are such that they allow IMMOBEL to recruit, retain and motivate qualified and competent professionals taking into account the nature and the extent of their individual responsibilities on an ongoing basis.
A procedure exists for the evaluation of their performances: the Managing Director establishes a proposal of the remuneration to the RAC, which evaluates in its turn the performances of the Management Committee.
The final decision with regard to the variable remuneration to be paid out belongs to the Board of Directors (bearing in mind that the final decision will be taken upon evaluation of the performance in view of the objectives/performances criteria). The Board of Directors analyses the competitiveness of IMMOBEL's remuneration structure on the initiative of the RAC.
Remuneration of the Members of the Management Committee aims to:
I stimulate, recognize and compensate both significant individual contributions and strong collective performances.
No changes were made in 2013 to the remuneration policy of the Members of the Management Committee.
(iii) the evaluation of the effectiveness of the Board of Directors as a whole.
I monitor the quality and effectiveness of the activities of the Board of Directors:
Chairman of the Board of Directors is the only non-executive Director to have a permanent infrastructure (office and secretariat) at his disposal. The other non-executive Directors receive logistical support from the General Secretariat in function of their requirements. Furthermore, the Company ensures it takes the usual insurance policies to cover the activities that the Members of the Board of Directors carry out within the scope of their mandates.
The individual sums of remuneration given directly or indirectly to (non-executive) Directors in 2013 are shown in the table below. All of the amounts shown are gross, i.e. before the deduction of tax.
| PRESENCE | REMUNERATION | |||||
|---|---|---|---|---|---|---|
| AT BOARD | AT AFC | AT RAC | AT IAMC | AT CID | ||
| Baron Buysse | 10/11 | 4/4 (invited) |
2/2 (invited) |
4/4 (invited) |
3/6 (invited) |
200 000 EUR1 |
| Baron Buysse | Supervisory Board | 250 000 EUR2 | ||||
| GAËTAN PIRET sprl3 |
11/11 | 4/4 (invited) |
2/2 (invited) |
4/4 | 5/6 (invited) |
See page 83 |
| ARSEMA sprl4 | 9/11 | 4/4 | 2/2 | - | 6/6 | 50 000 EUR |
| Maciej Drozd | 11/11 | 4/4 | - | - | - | 12 500 EUR |
| Maciej Dyjas | 10/11 | - | - | 2/4 | - | 12 500 EUR |
| Dany Dwek5 | 10/11 | 2/2 | 4/4 | - | 12 500 EUR | |
| Marc Grosman | 5/11 | - | - | 4/4 | - | 12 500 EUR |
| Marek Modecki | 10/11 | - | 1/2 | - | 6/6 | 25 000 EUR |
| Wilfried Verstraete |
7/11 | 4/4 | - | 4/4 | 4/6 | 50 000 EUR |
| Laurent Wasteels |
9/11 | - | 1/2 | - | 6/6 | 25 000 EUR |
| Total gross remuneration |
650 000 EUR |
Remuneration of the Members of the Management Committee is divided into a fixed part and a variable part; the latter includes:
The variable qualitative remuneration is based on two types of criteria:
I the optimal realization of the projects as well as the management and control of the risks. These elements are analyzed in perspective with for instance the permits, leases, sales, financings, etc,
8 3
I the personal implication, motivation and imple mentation of decision towards the appropriate development of the projects and the Company.
The Members of the Management Committee do benefit from a weighted remuneration, at 60% for quantitative aspects, and at 40% for qualitative aspects, compared to total variable remunera tion.
Based on the global performance of the Company during 2013 and on the realization of the individ ual targets of the Members of the Management Committee between 1 January and 31 December 2013, the variable part of the global remunera tion (qualitative and quantitative) paid for 2013, represented 40.10% of its basic remuneration for the Managing Director and 21.60% for the other Members (If the targets were reached at 100%, the variable part of the global remuneration could have been 44.40% for the Managing Director and 38% for the other Members).
Pursuant to the Law, and for financial year 2013 (variable due in 2014), in case the variable remu neration of a Member of the Management Com mittee exceeds 1/4 of his total remuneration, it should be deferred in time; as such, only half of the total variable remuneration is attributed in 2013 and the 3rd and 4th quarter of the variable for 2013 is attributed, insofar the targets linked to this variable remuneration were attained, respec tively over a period of two years (2013-2014) and over a period of three years (2013-2014-2015). For this deferral, the quantitative criterion that has been taken in account is the accrued Return on Equity for the 2 or 3 years concerned.
| MANAGING DIRECTOR CHAIRMAN OF THE MANAGEMENT COMMITTEE |
MEMBERS 1 OF THE MANAGEMENT COMMITTEE |
|
|---|---|---|
| Basic remuneration | 507 146.70 EUR | 868 534.75 EUR |
| Variable remuneration |
203 139.93 EUR | 187 642.87 EUR |
| Individual pension commitment |
Néant | 54 833.80 EUR |
| Company car | 24 000.00 EUR | 23 176.85 EUR |
| Other benefits | None | None |
1.Christian Karkan, Philippe Helleputte, Philippe Opsomer.
One Member of the Management Committee has an individual pension commitment type "defined contribution" paid by the Company which includes life insurance, death insurance, disabil ity insurance and a waiver of premium.
Regarding professional expenses chargeable to the Company, the same rules apply to Mem bers of the Management Committee, including the Chairman of the Management Committee (Managing Director), as they apply to all the employees: professional expenses incurred must be justified post by post. The Company is not responsible for private expenses.
Under the leadership of its Chairman, the Board of Directors regularly examines and evaluates its own performance and that of its Committees, as well as the efficacy of IMMOBEL's governance structure, including the number, role and respon sibilities of the various Committees set up by the Board of Directors.
A periodic evaluation of the contribution made by each Director is carried out with a view to fine-tuning the composition of the Board of Directors to take into account changing circum stances. Individual Directors' performance is evaluated as part of the re-election procedure.
Each year, at the proposal of the RAC the Board of Directors decides on the objectives of the Managing Director for the coming financial year and evaluates his performance for the period drawing to a close, in conformity with the procedure currently in place. This evaluation of the Managing Director's performance is also used to fix the variable part of his annual remuneration.
The remuneration of the individual Members of the Management Committee is fixed by the Board of Directors at the recommendation of the RAC, following proposals made by the Managing Director.
Remuneration of the Members of the Management Committee is variable: their remuneration is linked to the Company's results, taking into account the performance evaluation criteria with respect to the objectives, the evaluation period and the evaluation method.
The mandate as Member of the Management Committee does not entail entitlement to shares, share options or any other rights to acquire shares.
As in 2013, the quantitative variable remuneration will be exclusively based on the Return on Equity, whereas the qualitative variable remuneration will be determined in function of the responsibilities, the mission and the targets achieved during the reviewed financial year.
Remuneration of the Members of the Management Committee entails no entitlement to shares and/or share options or any other rights to acquire shares.
The Members of the Management Committee fulfill their duties to the Company based on a service provision contract. These contracts are similar to those generally agreed to with Members of their Management Committee by other listed companies.
Any indemnity due to a Member of the Management Committee by the IMMOBEL Group in the event of the termination of his service provision contract, will vary in function of the terms and conditions of the contract concerned, as specified hereafter, increased, if appropriate, by part of the variable remuneration linked to IMMOBEL's results.
The table below shows the indemnities that would be owed by the Group in case of the termination of contracts with the following Members of the Management Committee:
| Gaëtan PIRET | 24 months |
|---|---|
| Philippe HELLEPUTTE | 18 months |
| Christian KARKAN | 18 months |
| Philippe OPSOMER | 12 months |
As the variable remuneration will only be attributed after approval of the Annual Accounts by the Ordinary General Meeting, there exists no specific right to recover variable remuneration paid out based on erroneous financial information.
CONDENSED COMPANY ACCOUNTS
| 87 | CONSOLIDATED ACCOUNTS |
|---|---|
| 87 | CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME |
| 88 | CONSOLIDATED STATEMENT OF FINANCIAL POSITION |
| 89 | CONSOLIDATED STATEMENT OF CASH FLOW |
| 90 | CONSOLIDATED STATEMENT OF CHANGES IN EQUITY |
| 91 | ACCOUNTING PRINCIPLES AND METHODS |
| 97 | NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS |
| 97 | Change in accounting method: application of IAS 19 amended |
| "Employee Benefits" | |
| 98 | 1. Operating segments - Financial information by business segment |
| 100 | 2. Turnover |
| 100 | 3. Other operating income |
| 100 | 4. Cost of sales |
| 101 | 5. Personnel expenses |
| 101 | 6. Amortisation, depreciation and impairment of assets |
| 101 | 7. Other operating expenses |
| 102 | 8. Financial result |
| 103 | 9. Income taxes |
| 103 | 10. Earnings per share |
| 104 | 11. Intangible assets |
| 104 | 12. Property, plant and equipment |
| 104 | 13. Investment property |
| 105 | 14. Investments in associates |
| NOTES | 31-12-2013 | 31-12-2012 RESTATED |
|
|---|---|---|---|
| OPERATING INCOME | 65 114 | 133 706 | |
| Turnover | 2 | 53 847 | 126 771 |
| Other operating income | 3 | 11 267 | 6 935 |
| OPERATING EXPENSES | -54 543 | -114 333 | |
| Cost of sales | 4 | -35 152 | -95 135 |
| Personnel expenses | 5 | -7 982 | -8 013 |
| Amortisation, depreciation and impairment of assets (including reversals) | 6 | -435 | -675 |
| Change in the fair value of investment property | 13 | -60 | 377 |
| Other operating expenses | 7 | -10 914 | -10 887 |
| OPERATING RESULT | 10 571 | 19 373 | |
| Interest income | 293 | 465 | |
| Interest expense | -9 193 | -6 529 | |
| Other financial income | 71 | 57 | |
| Other financial expenses | -441 | -784 | |
| FINANCIAL RESULT | 8 | -9 270 | -6 791 |
| Share in the result of investments in associates | 189 | 23 | |
| RESULT FROM CONTINUING OPERATIONS BEFORE TAXES | 1 490 | 12 605 | |
| Income taxes | 9 | -20 | -910 |
| RESULT FROM CONTINUING OPERATIONS | 1 470 | 11 695 | |
| RESULT OF THE YEAR | 1 470 | 11 695 | |
| Share of non-controlling interests | -1 | -10 | |
| SHARE OF IMMOBEL | 1 471 | 11 705 | |
| RESULT OF THE YEAR | 1 470 | 11 695 | |
| Other comprehensive income - items subject to subsequent recycling in the income statement |
-99 | 827 | |
| Currency translation | -99 | 1 083 | |
| Currency translation - recycling in the income statement | - | -256 | |
| Other comprehensive income - items that are not subject to subsequent recycling in the income statement |
-208 | -330 | |
| Actuarial gains and losses (-) on defined-benefit plans | -208 | -330 | |
| Deferred taxes | - | - | |
| TOTAL OTHER COMPREHENSIVE INCOME | -307 | 497 | |
| COMPREHENSIVE INCOME OF THE YEAR | 1 163 | 12 192 | |
| Share of non-controlling interests | -1 | -10 | |
| SHARE OF IMMOBEL | 1 164 | 12 202 | |
| NET RESULT OF IMMOBEL PER SHARE (EUR) (DILUTED AND BASIC) | 10 | 0.36 | 2.84 |
| COMPREHENSIVE INCOME OF IMMOBEL PER SHARE (EUR) (DILUTED AND BASIC) |
0.28 | 2.96 |
| ASSETS | NOTES | 31-12-2013 | 31-12-2012 RESTATED |
31-12-2011 RESTATED |
|---|---|---|---|---|
| NON-CURRENT ASSETS | 6 517 | 7 693 | 5 844 | |
| Intangible assets | 11 | 95 | 36 | 47 |
| Property, plant and equipment | 12 | 1 024 | 1 255 | 1 214 |
| Investment property | 13 | 2 603 | 2 663 | 2 286 |
| Investments in associates | 14 | 1 097 | 1 069 | 1 254 |
| Financial assets available for sale | 15 | 0 | 1 300 | 77 |
| Deferred tax assets | 16 | 1 444 | 1 117 | 717 |
| Other non-current assets | 254 | 253 | 249 | |
| CURRENT ASSETS | 520 447 | 409 874 | 400 954 | |
| Inventories | 17 | 464 655 | 359 924 | 327 863 |
| Trade receivables | 18 | 9 063 | 12 816 | 10 956 |
| Tax receivables | 391 | 376 | 5 | |
| Other current assets | 19 | 14 944 | 9 840 | 15 166 |
| Cash and cash equivalents | 20 | 31 394 | 26 918 | 46 964 |
| TOTAL ASSETS | 526 964 | 417 567 | 406 798 | |
| EQUITY AND LIABILITIES | NOTES | 31-12-2013 | 31-12-2012 RESTATED |
31-12-2011 RESTATED |
| TOTAL EQUITY | 21 | 183 177 | 187 731 | 182 752 |
| EQUITY SHARE OF IMMOBEL | 183 168 | 187 775 | 182 785 | |
| Share capital | 60 302 | 60 302 | 60 302 | |
| Retained earnings | 122 710 | 127 010 | 122 517 | |
| Reserves | 156 | 463 | -34 | |
| NON-CONTROLLING INTERESTS | 9 | -44 | -33 | |
| NON-CURRENT LIABILITIES | 152 396 | 136 224 | 112 684 | |
| Employee benefit obligations | 22 | 916 | 685 | 339 |
| Provisions | 23 | 30 | 11 | 2 997 |
| Financial debts | 20 | 151 450 | 135 528 | 109 348 |
| CURRENT LIABILITIES | 191 391 | 93 612 | 111 362 | |
| Provisions | 23 | 1 295 | 1 785 | 1 479 |
| Financial debts | 20 | 148 757 | 51 788 | 74 330 |
| Trade payables | 24 | 20 729 | 21 509 | 20 883 |
| Tax liabilities | 309 | 1 424 | 1 476 | |
| Derivative financial instruments | 20 | 473 | 2 132 | 1 807 |
| Other current liabilities | 25 | 19 828 | 14 974 | 11 387 |
| TOTAL EQUITY AND LIABILITIES | 526 964 | 417 567 | 406 798 |
| NOTES | 31-12-2013 | 31-12-2012 RESTATED |
|
|---|---|---|---|
| Operating result | 10 571 | 19 373 | |
| Amortisation, depreciation and impairment of assets | 6 | 435 | 675 |
| Change in the fair value of investment property | 13 | 60 | -377 |
| Change in provisions | 7, 23 | -448 | -2 664 |
| CASH FLOW FROM OPERATIONS BEFORE CHANGES IN WORKING CAPITAL |
10 618 | 17 007 | |
| Change in working capital | 26 | -100 567 | -21 725 |
| CASH FLOW FROM OPERATIONS BEFORE PAID INTERESTS AND PAID TAXES |
-89 949 | -4 718 | |
| Paid interests | 8 | -9 730 | -10 016 |
| Paid income taxes | 9 | -1 477 | -1 733 |
| CASH FROM OPERATING ACTIVITIES | -101 156 | -16 467 | |
| Disposal of associates | 14 | 1 300 | 220 |
| Acquisitions of intangible, tangible and other non-current assets | -104 | -286 | |
| CASH FROM INVESTING ACTIVITIES | 1 196 | -66 | |
| Increase in financial debts | 20 | 125 915 | 81 442 |
| Repayment of financial debts | 20 | -15 631 | -77 804 |
| Interest received | 8 | 293 | 465 |
| Other financing cash flows | 8 | -370 | -403 |
| Gross dividend paid | -5 771 | -7 213 | |
| CASH FROM FINANCING ACTIVITIES | 104 436 | -3 513 | |
| NET INCREASE OR DECREASE (-) IN CASH | |||
| AND CASH EQUIVALENTS | 4 476 | -20 046 | |
| CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE YEAR | 26 918 | 46 964 | |
| CASH AND CASH EQUIVALENTS AT THE END OF THE YEAR | 31 394 | 26 918 |
Acquisitions and sales of projects, either directly or indirectly through the acquisition or the sale of project company, are not considered as investing activities and are directly included in the cash flows from the operating activities.
| CAPITAL | RETAINED EARNINGS |
CURRENCY TRANSLATION |
RESERVE FOR DEFINED BENEFIT PLANS |
EQUITY TO BE ALLOCATED TO THE GROUP |
NON CONTROLLING INTERESTS |
TOTAL EQUITY | |
|---|---|---|---|---|---|---|---|
| 2012 | |||||||
| BALANCE AS AT 01-01-2012 | 60 302 | 122 517 | -418 | 424 | 182 825 | -33 | 182 792 |
| Restatement IAS19 revised | - | - | - | -40 | -40 | - | -40 |
| BALANCE AFTER RESTATEMENT | 60 302 | 122 517 | -418 | 384 | 182 785 | -33 | 182 752 |
| Total comprehensive income for the year |
- | 11 705 | 827 | -330 | 12 202 | -10 | 12 192 |
| Dividends paid | - | -7 213 | - | - | -7 213 | - | -7 213 |
| Other | - | 1 | - | - | 1 | -1 | - |
| CHANGES IN THE YEAR | - | 4 493 | 827 | -330 | 4 990 | -11 | 4 979 |
| BALANCE AS AT 31-12-2012 | 60 302 | 127 010 | 409 | 54 | 187 775 | -44 | 187 731 |
| 2013 | |||||||
| BALANCE AS AT 01-01-2013 | 60 302 | 127 010 | 409 | 54 | 187 775 | -44 | 187 731 |
| Total comprehensive income for the year |
- | 1 471 | -99 | -208 | 1 164 | -1 | 1 163 |
| Dividends paid | - | -5 771 | - | - | -5 771 | - | -5 771 |
| Other | - | - | - | - | - | 54 | 54 |
| CHANGES IN THE YEAR | - | -4 300 | -99 | -208 | -4 607 | 53 | -4 554 |
| BALANCE AS AT 31-12-2013 | 60 302 | 122 710 | 310 | -154 | 183 168 | 9 | 183 177 |
IMMOBEL (hereafter named the "Company") is a limited company incorporated in Belgium. The address of its registered office is Rue de la Régence 58 at 1000 Brussels.
The consolidated financial statements have been prepared in accordance with IFRS (International Financial Reporting Standards) as adopted in the European Union. The Board of Directors settled the consolidated financial statements and approved their publication on 27th March 2014.
Those standards did not have a significant impact on the financial statements. IAS19 impact is presented in the notes.
I IFRS 10 Consolidated Financial Statements (applicable for annual periods beginning on or after 1 January 2014),
I IFRS 11 Joint Arrangements (applicable for annual periods beginning on or after 1 January 2014),
Application of IFRS 11 will result in review of the classification of interests in joint ventures. Joint ventures, currently consolidated applying the proportionate consolidation method will be consolidated using the equity method, which result in a decrease of the amounts of inventories and liabilities in the balance sheet.
The impacts on the 2013 financial statements are given in note 30.
Application of IFRS12 will result in additional disclosures, mainly with respect of joint ventures. Other standards are not expected to have a significant impact on the financial statements.
The consolidated financial statements are presented in thousands of EUR.
They are prepared on the historical cost basis, except for investment property, securities held for trading, available-for-sale securities and derivative financial instruments which are measured at fair value.
The consolidated financial statements include the financial statements of the Company and its subsidiaries, as well as interests in joint ventures consolidated using the proportionate method and in associated companies accounted for using the equity method.
All intragroup balances, transactions, revenue and expenses are eliminated.
Subsidiaries are companies controlled by the Group. Control is defined as the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities. Control is presumed to exist when the Group holds more than half of the voting rights, directly or indirectly.
The financial statements of subsidiaries are included in the consolidated financial statements from the date when control begins until the date when control ends.
A joint venture is a contractual agreement whereby the Group and one or several parties agree to undertake an economic activity under joint control. The joint venture agreement generally results in the creation of one or more distinct jointly controlled entities.
The Group consolidates its interests in joint ventures applying the proportionate consolidation method until the date when joint control ends.
Associates are entities over which the Group has significant influence through its participation in their financial and operating policy decisions. They are neither subsidiaries, nor joint ventures of the Group.
Significant influence is presumed if the Group, directly or indirectly, holds 20% or more but less than 50% of the voting rights through its subsidiaries.
Interests in associates are accounted for in the consolidated financial statements using the equity method, from the date when significant influence begins until the date when it ends. The book value of interests is decreased, if applicable, so as to record any impairment of individual interests.
The financial statements of subsidiaries, joint ventures and associates with reporting dates other than 31 December (reporting date of the Company) are adjusted so as to take into account the effect of significant transactions and events that occurred between the reporting date of the subsidiary, joint venture or associate and 31 December. The difference between 31 December and the reporting date of the subsidiary, joint venture or associate never exceeds 3 months.
Goodwill represents the excess of the price of the business combination over the Group's share in the net fair value of the identifiable assets, liabilities and contingent liabilities of the acquired entity at the date of acquisition. Goodwill is reported as an asset and is not amortised but annually subject to an impairment in value test at reporting date (or more frequently if there are indications of loss in value). Impairment losses are recognised immediately under income and are not reversed in subsequent periods.
Goodwill resulting from the acquisition of an associate is included in the book value of the associate. Goodwill resulting from the acquisition of subsidiaries and joint ventures is presented separately in the balance sheet.
On disposal of a subsidiary, a joint venture or an associate, the book value of the goodwill is included so as to determine the profit or loss on the disposal.
Negative goodwill represents the excess of the net fair value of the identifiable assets, liabilities and contingent liabilities of a subsidiary, a joint entity or an associate over the price of business combination at the date of acquisition. To the extent that a surplus subsists after review and re-evaluation of the values, the negative goodwill is immediately recognised in profit and loss.
The balance sheets of foreign companies are translated in EUR at the official year-end exchange rate and income statements are translated at the average exchange rate for the financial year.
Translation differences resulting therefrom are included under shareholders' equity under "translation differences". Upon disposal of an entity, translation differences are recognised in profit and loss.
Transactions are first recorded at the exchange rate prevailing on the transaction date. At each end of the financial year, monetary assets and liabilities are converted at the exchange rates on the balance sheet date. Gains or losses resulting from this conversion are recorded as financial result.
Intangible assets are recorded in the balance sheet if it is likely that the expected future economic benefits which may be allocated to assets will flow to the entity and if the cost of the assets can be measured reliably.
Intangible assets are measured at cost less accumulated amortisation and any impairment losses.
Intangible assets are amortised using the straight-line method on the basis of the best estimate of their useful lives. The amortisation period and method are reviewed at each reporting date.
Tangible assets are measured at cost less accumulated depreciation and any impairment losses. Fixed assets are depreciated prorata temporis on a straight-line basis over their useful lives. Useful lives have been determined as follows:
I buildings: 20 to 50 years,
Subsequent expenses related to tangible assets are only capitalised if it is likely that future economic benefits associated with the item will flow to the entity and if the cost of the item can be measured reliably.
Buildings under construction for manufacturing, leasing or administrative purposes are recorded at cost less any impairment loss. Depreciation of these assets begins when the assets are ready to be used.
Investment property is measured in accordance with the fair value model of IAS 40 - Investment property. It represents real property (land and / or buildings under construction or available) held by the Group so as to earn rent and / or create value for property rather than use or sell it. Investment property (under construction) is initially measured at cost and subsequently carried at fair value. Any change in fair value is directly recognised in the income statement.
The Group distinguishes finance leases and operating leases by determining if objective criteria indicate that the major part of the value of the asset will be used by the group:
I because the Group has a pruchase option for a price lower than the estimated value of the asset at the exercise date,
I based on other indicators.
Assets held by the Group under finance lease are initially recognised at their fair value or at the present value of the minimum lease payments, whichever is lower. The corresponding obligation to the lessor regarding this asset is included in the balance sheet as a finance lease obligation.
Lease payments are apportioned between financial expenses and the decrease in lease obligation at a constant interest rate with respect to the remaining debt balance. Financial expenses are directly recognised in profit and loss. Assets held under finance leases are depreciated on a straight-line basis over their expected useful lives or the lease term, whichever is shorter.
Lease payments under an operating lease are recognised as expenses in the income statement on a straight-line basis over the lease term.
Financial assets and financial liabilities are recognised in the Group's balance sheet when the Group becomes a party to the contractual provisions of the instrument.
Short term trade receivables are measured at nominal value less appropriate allowances for estimated irrecoverable amounts. An assessment of the permanent character of doubtful trade receivables is carried out and any write-downs are recorded.
Cash includes cash on hand and demand deposits (deposits of less than 3 months). Cash equivalents are very short term, highly liquid investments that are subject to an insignificant risk of change in value.
Cash and cash equivalents are carried in the balance sheet at amortized cost.
Cash flows are inflows and outflows of cash and cash equivalents.
Operating activities are the principal revenue-producing activities of the entity and other activities that are not investing or financing activities. Acquisitions and sales of projects, either directly through the purchase of sale of assets, or indirectly through the acquisition or sale of project companies, are considered as operating activities and are presented as part of the cash flows from operating activities.
Investing activities are the acquisition and disposal of longterm assets and other investments not included in cash equivalents.
Financing activities are activities that result in changes in the size and composition of the contributed equity and borrowings of the entity.
The classification of cash outflows resulting from acquisition of project companies as operating cash flows resulted in an impact of 31 534 KEUR (see note 31).
Issue costs that may be directly allocated to an equity transaction are recorded as a deduction from equity. As a consequence, capital increases are recorded at the proceeds received, net of issue costs. Similarly, equity transactions on own participation are recognised directly under shareholders' equity.
Interest-bearing bank borrowings and overdrafts are recorded at the cash amount, less any transaction costs. After the initial recording they are measured at amortised cost. Any difference between the received consideration and the expected exit value is recognised under income over the term of the borrowing using the effective interest rate.
Short-term trade payables are recorded at their nominal value.
Derivative financial instruments are initially measured at cost and subsequently carried at their fair values. The method of recognising the unrealised result from derivatives depends on the nature of the hedged item. On the date a derivative contract is entered into, the instrument is designated either as a hedge of the fair value of recognised assets or liabilities (fair value hedge) or as a hedge of future cash flows (cash flow hedge). Changes in the fair value of derivative financial instruments designated as fair value hedge are recorded in profit and loss, in addition to the changes in the fair value of the hedged asset or liability. With respect to cash flow hedges, the changes in the fair value are recognised in the other elements of comprehensive income. The ineffective hedging portion is recorded directly in profit and loss. The changes in the fair value of derivative instruments that do not meet the hedge accounting requirements are recognised directly under income.
Contract proceeds and costs are recognised according to the stage of completion of the contract based on the cost method (the relation between the costs already accrued for work performed and the total estimated contract costs) excluding the costs that do not reflect the work performed (land costs, goodwill allocated to the land, installation costs, etc.).
Contract proceeds include the amounts agreed to in the initial contract and in its amendments, indemnities, and other bonuses and incentive payments, if it is likely that they will be acquired and if they can be reliably measured.
Contract costs include costs that relate directly to the specific contract, expenses that may be allocated to contract activity in general and that may be reasonably allocated to the contract, and other similar costs that may be specifically invoiced to the customer under the terms of the contract.
If it seems that total contract costs will exceed total contract proceeds, the expected loss is immediately recognised as an expense.
Interests during construction are capitalised, for the projects started after 1 January 2009.
Inventories are measured at cost or net realisable value, whichever is lower.
The acquisition cost of purchased goods includes acquisition cost and incidental expenses. For finished goods and work in progress, the costprice takes into account direct expenses and a portion of production overhead without including administrative and financial expenses. Interests during construction are capitalised, for the projects started after 1 January 2009.
When specific identification is not possible, cost is determined using the weighted average cost method. Net realisable value is the estimated selling price in the ordinary course of business less the estimated costs of completion and the estimated cost necessary to make the sale. The impairment in value or loss on inventories to bring them to their net realisable value is recognised as an expense in the year when the impairment in value or loss occurs.
Provisions are recognised when the Group has a present obligation (legal or constructive) as a result of a past event, when it is likely that an outflow of resources will be necessary to settle the obligation and when a reliable estimate of the amount of the obligation can be made.
The amount recognised as a provision is the best estimate of the expenditure required to settle the present obligation if necessary.
A provision for warranties is made when underlying products or services are sold. The measurement of the provision is based on historical data and by weighing all possible outcomes to which probabilities are associated (expected value method).
Contingent liabilities, which occurrence is not probably, are not recognized as a provision and are mentioned in the notes to the financial statements, provided that the risk is significant.
Contingent assets are not recognized in the financial statements.
The current post employment benefit plan of the Group is a defined benefit plan.
For such a plan, the cost of corresponding commitments is determined using the Projected Unit Credit Method, with present values being calculated at year end.
The amount recognised in the balance sheet represents the present value of commitments in terms of the defined benefit pension plans, less the fair value of plan assets and costs of rendered services not yet recognised. Any asset resulting from this calculation is limited to the present value of possible payments for the Group and the decreases in future contributions to the plan.
Actuarial gains and losses are directly recorded in the other elements of comprehensive income and are presented in the statement of comprehensive income.
Received government grants related to assets or investment subsidies are recognised in the balance sheet (presented under other long-term liabilities or other short-term liabilities) as deferred income. They are recognised as income in the same way as the asset margin to which they relate.
Group revenue comes mainly from Real Estate Development activities (including Project Management services) and also from lease agreements.
Revenue from Real Estate Development activities is measured at the fair value of the consideration received or receivable.
To the extent that the sale contract contains several distinct parts and whose delivery is separate, the different parts are recognised separately for the proceeds of the sale.
To the extent that the contract of sale of a property development (or part of this contract) qualifies as a construction contract, the proceeds of the sale is recognized at the advancement of the project, as detailed in paragraph 11.
To the extent that the sale contract of a property development (or part of this contract) does not qualifies as a construction contract, the proceeds of the sale is recognised at delivery, unless the contract states that there is continuing transfer of ownership in order to be possible to recognise the revenue of the sale over the period of the transfer of ownership, or at the advancement of the project.
With respect to operating leases, rent is recognised under income on a straight-line basis over the term of the lease, even if payments are not made on this basis. Lease incentives granted by the Group in negotiating or renewing an operating lease are recognised as a reduction of the lease income on a straight-line basis over the term of the lease. Rent income are presented as other operating income in the consolidated statement of comprehensive income.
The carrying amount of non-current assets (other than financial assets in the scope of IAS 39, deferred taxes and non-current assets held for sale) is reviewed at the end of each reporting period in order to determine if an indication exists that an asset has impaired. If such indication exists, the recoverable amount is then determined. Regarding intangible assets with indefinite useful lives and goodwill, the recoverable amount is estimated at the end of each reporting period. An impairment loss is recognized if the carrying amount of the asset or the cash-generating unit exceeds its recoverable amount. Impairment losses are presented in the income statement.
When the recoverable amount cannot be individually determined for an asset, including goodwill, it is measured at the level of the cash generating unit to which the asset belongs.
The revoverable amount of receivables and investments of the company held to maturity is the present value of the future cash flows, discounted at the original effective interest rate inherent to those assets.
The recoverable amount of other assets or cash-generating unit is its fair value less selling costs or its use value, whichever is higher. The latter is the present value of expected future cash flows from the asset or the respective cash generating unit.
In order to determine the value in use, the future cash flows are discounted using a pre-tax discount rate which reflects both the current market rate and the specific risks of the asset.
A reversal of impairment loss is recognised under income if the recoverable amount exceeds the net book value. However, the reversal may not lead to a higher book value than the value that would have been determined if no impairment loss had been initially recorded on this asset (cash-generating unit). No reversal of impairment loss is recognized on goodwill.
Borrowing costs include interests on bank overdrafts and shortand long-term borrowings, amortisation of share premiums or repayment of borrowings, amortisation of accrued incidental borrowing costs. The costs are capitalised into the cost of qualifying assets. The fair value adjustements of financial derivatives associated to financial debts related to specific projects are capitalised, even if the derivative is not accounted as hedging instrument.
Income tax for the year includes current and deferred tax. Current and deferred income taxes are recognised in profit and loss only if they relate to items recognised directly under shareholders' equity, in which case they are also recognised under shareholders' equity.
Current tax is the amount of income taxes payable (or recoverable) on the profit (or loss) in a financial year and the adjustments to tax charges of previous years.
Deferred tax is recognised using the liability method of tax allocation, based on timing differences between the book value of assets and liabilities in the consolidated accounts and their tax basis.
Deferred tax liabilities are recognised for all taxable timing differences.
Deferred tax assets are only recognised for deductible timing differences if it is likely that in the future they may be charged against taxable income. This criterion is re-evaluated at each reporting date.
A discontinued operation is a component of an entity that either has been disposed of or is classified as held for sale. Such component represents a separate major line of business or geographical area of operations that can be clearly distinguished, operationally and for financial reporting purposes. The net result of discontinued operations (including possible results on disposal and taxes) is presented separately from the continued operations in the income statement.
The deferred tax assets are only recorded as far that they may be in the future used against taxable income.
The tangible and intangible assets with a fixed useful live are straight line depreciated based on the estimation of the live time of these fixed assets.
The fair value of the investment properties is estimated by independent experts in accordance with the principles as described under note 13 of the financial statements.
As part of the tests of impairment losses, the recoverable value of an asset is estimated based on the present value of the expected cash flows generated by this asset.
For the provisions, the bookvalue fits with the best estimation of the expense necessary to pay off the present obligation (legal or implicit) at closing date.
The projects in inventory and construction contracts are subject to feasibility studies used for the release of margin and the computation of the rate of completion. At each closing date, the expenses to be incurred are estimated.
The group determines whether it has control, joint control or significant influence over investments; it must also determine when such control or influence is lost (eg when a project company is sold to a third party).
Upon acquiring control over a company, the group determines whether the acquisition is a business combination or not (in most instances, project companies acquisitions are not business combinations).
The accounts of the temporary joint venture are accounted for in the financial statements using the proportionate consolidation method, each heading of the balance sheet and of the income statement is included in proportion to the share held by the partner in the temporary joint venture.
A segment is a distinguishable component of the company, which generates revenues and costs.
The operating results are regularly reviewed by the Management Committee in order to monitor the performance of the various segments in terms of strategic goals , plans and budgets.
The company is composed of 3 segments: "offices", "residential development" and "land development".
As of January 1, 2013, the group applied the principles described in IAS 19 revised "Employee Benefits" which implies several changes on the accounting methods related to the pension benefits which includes:
The comparative financial statements have been modified in accordingly. The impacts on the financial statements are the following:
| 31-12-2011 PUBLISHED |
IMPACT IAS 19 R |
31-12-2011 RESTATED |
31-12-2012 PUBLISHED |
IMPACT IAS 19 R |
31-12-2012 RESTATED |
|
|---|---|---|---|---|---|---|
| EQUITY, INCLUDING : | 182 792 | -40 | 182 752 | 187 811 | -80 | 187 731 |
| Report from previous year | 122 517 | 122 517 | 127 024 | -14 | 127 010 | |
| Reserve for defined benefit plans | 424 | -40 | 384 | 120 | -66 | 54 |
| LIABILITIES, INCLUDING : | ||||||
| Employee benefit obligations | 299 | 40 | 339 | 605 | 80 | 685 |
The segment reporting is presented in respect of the operational segments. The results and asset and liability items of the segment include items that can be attributed to a segment, either directly, or allocated on an allocation formula. The core business of the Company, real estate development, includes the activities of "offices", "residential development" and "land development".
There are no transaction between the different sectors. The Group's activity is carried out in Belgium, Grand Duchy of Luxembourg and Poland. The breakdown of sales by country depends on the country where the activity is executed.
| TURNOVER | OPERATING RESULT | |||
|---|---|---|---|---|
| 31-12-2013 | 31-12-2012 RESTATED |
31-12-2013 | 31-12-2012 RESTATED |
|
| OFFICES | ||||
| Belgium | 8 958 | 59 039 | -1 953 | 4 711 |
| Grand-Duchy of Luxemburg | - | - | 1 822 | 842 |
| Poland | - | 19 091 | -638 | 8 590 |
| SUBTOTAL OFFICES | 8 958 | 78 130 | -769 | 14 143 |
| RESIDENTIAL | ||||
| Belgium | 17 410 | 18 585 | 4 666 | 394 |
| Grand-Duchy of Luxemburg | 9 098 | 16 220 | 1 318 | 2 179 |
| Poland | 3 275 | 2 417 | 52 | - |
| SUBTOTAL RESIDENTIAL | 29 783 | 37 222 | 6 036 | 2 573 |
| LANDBANKING | ||||
| Belgium | 15 106 | 11 419 | 5 304 | 2 657 |
| SUBTOTAL LANDBANKING | 15 106 | 11 419 | 5 304 | 2 657 |
| TOTAL CONSOLIDATED | 53 847 | 126 771 | 10 571 | 19 373 |
| Belgium | 41 474 | 89 043 | 8 017 | 7 762 |
| Grand-Duchy of Luxemburg | 9 098 | 16 220 | 3 140 | 3 021 |
| Poland | 3 275 | 21 508 | -586 | 8 590 |
| 31-12-2013 | 31-12-2012 RESTATED |
|
|---|---|---|
| Financial result | -9 270 | -6 791 |
| Share in the result of investments in associates | 189 | 23 |
| Income taxes | -20 | -910 |
| RESULT FROM CONTINUING OPERATIONS | 1 470 | 11 695 |
| NET RESULT | 1 470 | 11 695 |
| OFFICES | RESIDENTIAL DEVELOPMENT |
LAND DEVELOPMENT |
CONSOLIDATED | |
|---|---|---|---|---|
| 2013 | ||||
| Operating result | -769 | 6 036 | 5 304 | 10 571 |
| Amortisation, depreciation and impairment of assets | 320 | 61 | 54 | 435 |
| Change in the fair value of investment property | 60 | - | - | 60 |
| Change in provisions | 137 | -592 | 7 | -448 |
| Change in working capital | -85 726 | -4 400 | -10 441 | -100 567 |
| OPERATING CASH FLOW BEFORE PAID INTERESTS AND PAID INCOME TAXES |
-85 978 | 1 105 | -5 076 | -89 949 |
| CASH FROM INVESTING ACTIVITIES | 1 238 | -23 | -19 | 1 196 |
| 2012 | ||||
| Operating result | 14 143 | 2 573 | 2 657 | 19 373 |
| Amortisation, depreciation and impairment of assets | 219 | 378 | 78 | 675 |
| Change in the fair value of investment property | -377 | - | - | -377 |
| Change in provisions | -2 606 | -33 | -25 | -2 664 |
| Change in working capital | 3 286 | -20 491 | -4 520 | -21 725 |
| OPERATING CASH FLOW BEFORE PAID INTERESTS AND PAID INCOME TAXES |
14 665 | -17 573 | -1 810 | -4 718 |
| CASH FROM INVESTING ACTIVITIES | 67 | -65 | -68 | -66 |
| OFFICES | RESIDENTIAL DEVELOPMENT |
LAND DEVELOPMENT |
CONSOLIDATED | |
|---|---|---|---|---|
| 2013 | ||||
| Segment assets | 292 013 | 109 037 | 91 334 | 492 384 |
| Unallocated items1 | - | - | - | 34 580 |
| TOTAL ASSETS | - | - | - | 526 964 |
| Segment liabilities | 20 233 | 19 276 | 5 896 | 45 405 |
| Unallocated items1 | - | - | - | 298 382 |
| TOTAL LIABILITIES | - | - | - | 343 787 |
2012
| Segment assets | 210 786 | 96 103 | 79 645 | 386 534 |
|---|---|---|---|---|
| Unallocated items1 | - | - | - | 31 033 |
| TOTAL ASSETS | - | - | - | 417 567 |
| Segment liabilities | 23 945 | 10 042 | 4 977 | 38 964 |
| Unallocated items1 | - | - | - | 190 872 |
| TOTAL LIABILITIES | - | - | - | 229 836 |
| BELGIUM | GRAND-DUCHY OF LUXEMBURG |
POLAND | TOTAL | |
|---|---|---|---|---|
| Segment assets 31-12-2013 | 292 013 | 109 037 | 91 334 | 492 384 |
| Segment assets 31-12-2012 | 279 053 | 47 920 | 59 561 | 386 534 |
| Non-current segment assets 31-12-2013 | 4 845 | 225 | 3 | 5 073 |
| Non-current segment assets 31-12-2012 | 5 047 | 225 | 1 304 | 6 576 |
Turnover is allocated as follows per segment:
| 31-12-2013 | 31-12-2012 RESTATED | |
|---|---|---|
| Offices | 8 958 | 78 130 |
| Residential Development1 | 29 783 | 37 222 |
| Land Development2 | 15 106 | 11 419 |
| TOTAL TURNOVER | 53 847 | 126 771 |
In 2013, there are no sales transactions with an individual client representing more than 10% of the turnover.
Other operating income is allocated by segment as follows:
| 31-12-2013 | 31-12-2012 RESTATED | |
|---|---|---|
| Offices | 7 983 | 6 017 |
| Residential Development | 2 907 | 727 |
| Land Development | 377 | 191 |
| TOTAL OTHER OPERATING INCOME | 11 267 | 6 935 |
This heading includes rental income (6 543 KEUR compared to 3 990 KEUR in 2012) on properties available for sale or awaiting for development, recoveries of taxes and withholdings, reinvoicing of expenses and other miscellaneous reimbursements.
Cost of sales is allocated as follows per segment:
| 31-12-2013 | 31-12-2012 RESTATED | |
|---|---|---|
| Offices | -6 552 | -58 768 |
| Residential Development | -22 087 | -30 512 |
| Land Development | -6 513 | -5 855 |
| TOTAL COST OF SALES | -35 152 | -95 135 |
and are related to the turnover and the projects mentionned in note 2.
1. The promotions Bella Vita in Waterloo, Charmeraie in Brussels (Uccle), Vallée du Maelbeek and Forum in Brussels (City), Lindepark in Tervueren and Green Hill in the Grand-Duchy of Luxemburg contribute in particular to the "Residential Development" turnover. IMMOBEL has also sold two assets destined for residential development located in Poland (Warsaw and Gdansk).
2. During 2013 land sales constitued 99 transactions. They involved 13.9 ha net (IMMOBEL Group share), in urban planning zones. Major recurrent sales (turnover more than 200 KEUR) of the year relate to the land development projects in Berloz, Bredene, Chastre, Enghien, Eupen, Limbourg, Lontzen, Montzen ,Rhisnes, Sart-Bernard, Soumagne, Sprimont, Stavelot, Temploux, Uccle and Waterloo.
This heading includes salaries and fees of personnel, members of the Executive Committee and non-executive Directors.
They break down as follows:
| 31-12-2013 | 31-12-2012 RESTATED | |
|---|---|---|
| Salaries and fees of personnel and members of the Executive Committee | -6 521 | -6 676 |
| Salaries of the non-executive Directors | -650 | -656 |
| Social security charges | -521 | -483 |
| Pension costs - defined benefits plan | -213 | -137 |
| Other | -77 | -61 |
| PERSONNEL EXPENSES | -7 982 | -8 013 |
The number of full time equivalents on 31 December, 2013 amounted 27 compared to 28 in 2012.
Break down as follows:
| 31-12-2013 | 31-12-2012 RESTATED | |
|---|---|---|
| Amortisation of intangible and tangible assets | -274 | -251 |
| Impairment loss on investments in associates | -120 | - |
| Impairment loss on participating interests available for sale | - | -77 |
| Write down on inventory | -14 | -506 |
| Reversal of write down on inventory | - | 158 |
| Write down on trade receivables | -27 | - |
| Reversal of write down on trade receivables | - | 1 |
| AMORTISATION, DEPRECIATION AND IMPAIRMENT OF ASSETS | -435 | -675 |
| Break down as follows: | ||
|---|---|---|
| 31-12-2013 | 31-12-2012 RESTATED | |
| Services and other goods | -9 577 | -9 631 |
| Other expenses | -1 808 | -3 894 |
| Provisions | 471 | 2 638 |
| OTHER OPERATING EXPENSES | -10 914 | -10 887 |
| Main components of services and other goods: |
| 31-12-2013 | 31-12-2012 RESTATED | |
|---|---|---|
| Rent and service charges, including mainly rent and service charges for the registered office |
-720 | -679 |
| Third party payment, including in particular the fees paid to third parties and related to the turnover |
-6 526 | -7 337 |
| Other services and other goods, including company supplies, advertising, maintenance and repair expense of properties available for sale or awaiting for development |
-2 331 | -1 615 |
| TOTAL SERVICES AND OTHER GOODS | -9 577 | -9 631 |
| 31-12-2013 | 31-12-2012 RESTATED | |
|---|---|---|
| Total amount of payments recognised under expenses for the year | -422 | -429 |
| Total minimum payments to be made: | ||
| - within one year | -417 | -416 |
| - after one year but within 5 years | -1 257 | -1 622 |
| - more than 5 years | - | -60 |
These amounts correspond mainly to the rent for the registered office and cars.
Amount of fees allocated during the year to SC s.f.d. SCRL Deloitte Reviseurs d'Entreprises:
| 31-12-2013 | 31-12-2012 RESTATED | |
|---|---|---|
| Audit fees at consolidation level | -185 | -190 |
| Fees for extraordinary services and special missions accomplished within the Group1: |
-98 | -105 |
| - Other missions outside the audit mission | -98 | -105 |
The other expenses of -1 808 KEUR mainly concern taxes (property withholding taxes, regional and municipal taxes) not capitalised on assets included in inventory. The figures of 2012 included an indemnity of -1.5 MEUR paid in connection with a litigation.
Main components of variations in provisions:
| 31-12-2013 | 31-12-2012 RESTATED | |
|---|---|---|
| Provisions related to the sales | 466 | 2 638 |
| Other provisions | 5 | - |
| TOTAL VARIATIONS IN PROVISIONS | 471 | 2 638 |
| Increase | -179 | -400 |
| Use | 32 | 1 538 |
| Reversal | 618 | 1 500 |
The financial result breaks down as follows:
| 31-12-2013 | 31-12-2012 RESTATED | |
|---|---|---|
| Cost of gross financial debt at amortised cost | -12 531 | -9 473 |
| Activated interests on projects in development | 1 680 | 2 944 |
| Fair value changes on financial instruments | 1 659 | -464 |
| Financial income from cash and cash equivalents | 293 | 465 |
| Other financial charges & income | -371 | -263 |
| FINANCIAL RESULT | -9 270 | -6 791 |
| Cost of gross financial debt at amortised cost | -12 531 | -9 473 |
| Interest related to 2012 / 2011 paid in 2013 / 2012 | -140 | -683 |
| Interest related to 2013 / 2012 payable in 2014 / 2013 | 2 941 | 140 |
| Paid interests (statement of cash flow) | -9 730 | -10 016 |
The increase in interest cost of financial debt is explained primarily by the financial charges linked to the bond issue in March 2013 for an amount of 60 MEUR at a rate of 5.5%.
The amounts relating to fair value changes are from financial instruments acquired for hedging purposes, but which were not designated as hedging for hedge accounting under IAS39. These instruments are detailed in note 20.
Income taxes are as follows:
| 31-12-2013 | 31-12-2012 RESTATED | |
|---|---|---|
| Current income taxes for the current year | -298 | -1 308 |
| Current income taxes for the previous financial years | -49 | -2 |
| Deferred taxes | 327 | 400 |
| TOTAL OF TAX EXPENSES RECOGNIZED IN THE STATEMENT OF COMPREHENSIVE INCOME |
-20 | -910 |
| Current income taxes | -347 | -1 310 |
| Increase in taxes receivables | -15 | -371 |
| Decrease in tax liabilities | -1 115 | -52 |
| Paid income taxes (statement of cash flow) | -1 477 | -1 733 |
The reconciliation of the actual tax charge with the theoretical tax charge is summarised as follows:
| 31-12-2013 | 31-12-2012 RESTATED | |
|---|---|---|
| Result before taxes | 1 490 | 12 605 |
| Share in the result of investments in associates | -189 | -23 |
| RESULT BEFORE TAXES AND SHARE IN THE RESULT OF INVESTMENTS IN ASSOCIATES |
1 301 | 12 582 |
| THEORETICAL INCOME TAXE CHARGE AT 33.99% | -442 | -4 277 |
| Tax impact: | ||
| - non-taxable income | - | 2 774 |
| - non-deductible expenses | -215 | -239 |
| - use of taxes losses and notional interests deduction carried forward on which no DTA was recognised in previous years |
1 937 | 1 312 |
| - losses on which no DTA is recognised | -1 394 | -511 |
| - recognition during the year of DTA on tax losses generated in prior years | 151 | - |
| Adjustment to current income taxes for the previous financial years & Other | -57 | 31 |
| TAX CHARGE | -20 | -910 |
| EFFECTIVE TAX RATE OF THE YEAR | 1.6% | 7.2% |
Due to the absence of potential dilutive ordinary shares in circulation, the basic result per share is the same as the diluted result per share.
Basic earnings and diluted earnings per share are determined using the following information:
| 31-12-2013 | 31-12-2012 RESTATED | |
|---|---|---|
| Average number of shares considered for basic earnings and diluted earnings | 4 121 987 | 4 121 987 |
| Net result from continuing operations | 1 470 | 11 695 |
| Group's share in the net result for the year | 1 471 | 11 705 |
| Net per share (in EUR): | ||
| - result of the continuing operations | 0.36 | 2.84 |
| - Group's share in the net result of the year | 0.36 | 2.84 |
Intangible assets evolve as follows:
| 31-12-2013 | 31-12-2012 RESTATED | |
|---|---|---|
| ACQUISITION COST AT THE END OF THE PREVIOUS PERIOD | 195 | 184 |
| Acquisitions | 75 | 47 |
| Transfer to Property, plant and equipment | - | -36 |
| ACQUISITION COST AT THE END OF THE YEAR | 270 | 195 |
| AMORTISATION AND IMPAIRMENT AT THE END OF THE PREVIOUS PERIOD | -159 | -137 |
| Amortisation | -16 | -22 |
| AMORTISATION AND IMPAIRMENT AT THE END OF THE YEAR | -175 | -159 |
| NET CARRYING AMOUNT AS AT 31 DECEMBER | 95 | 36 |
Property, plant and equipment evolve as follows:
| 31-12-2013 | 31-12-2012 RESTATED |
|---|---|
| 2 012 | 1 742 |
| 27 | 234 |
| - | 36 |
| 2 039 | 2 012 |
| -757 | -528 |
| -258 | -229 |
| -1 015 | -757 |
| 1 024 | 1 255 |
Property, plant and equipment consist primarily of installation costs of the headquarters, amortized over the lease term, or 9 years.
Investment property is measured by independent experts in accordance with the fair value model of the IAS 40 standard.
Investment property evolve as follows:
| 31-12-2013 | 31-12-2012 RESTATED | |
|---|---|---|
| FAIR VALUE ON 1 JANUARY | 2 663 | 2 286 |
| Change in the fair value recognized in the statement of comprehensive income | -60 | 377 |
| FAIR VALUE ON 31 DECEMBER | 2 603 | 2 663 |
This account contains a land under leasehold of an office building.
The fair value of this asset is estimated considering the transfer charges to be on charge of the purchaser.
Key assumptions used to determine fair value:
| 31-12-2013 | 31-12-2012 RESTATED | |
|---|---|---|
| Rental price (EUR) per m² of residential (2013 ) / offices (2012) | 115 | 175 |
| Discount rate | 6.75% | 7.40% |
Investments in associates refer to the "Offices Development" activity and are as follows:
| 31-12-2013 | 31-12-2012 RESTATED | |
|---|---|---|
| VALUE AS AT 1 JANUARY | 1 069 | 1 254 |
| Share in result | 189 | 23 |
| Acquisitions and reclassifications | - | 12 |
| Disposals and reclassifications | -41 | -220 |
| Impairment loss on investments in associates | -120 | - |
| CHANGES FOR THE YEAR | 28 | -185 |
| VALUE AS AT 31 DECEMBER | 1 097 | 1 069 |
The condensed financial statements of these entities are as follows:
| 31-12-2013 | 31-12-2012 RESTATED | |
|---|---|---|
| Total assets | 10 030 | 10 990 |
| Total liabilities | 6 137 | 7 684 |
| Net assets | 3 893 | 3 306 |
| Share in the net asset of the group IMMOBEL | 1 042 | 853 |
| Turnover | 2 813 | 596 |
| Net result of the year | 586 | 136 |
| Share of IMMOBEL in the net result of the year | 189 | 23 |
The associates are listed under note 31.
The investments available for sale moved as follows:
| 31-12-2013 | 31-12-2012 RESTATED | |
|---|---|---|
| VALUE AS AT 1 JANUARY | 1 300 | 77 |
| Disposals | -1 300 | 0 |
| Acquisition | - | 1 300 |
| Impairment loss | - | -77 |
| CHANGES FOR THE YEAR | -1 300 | 1 223 |
| VALUE AS AT 31 DECEMBER | 0 | 1 300 |
The book value as at 31 December of the participating interests available for sale is considered to be representative of their fair value.
Deferred tax assets or liabilities are recorded in the balance sheet on deductible or taxable temporary differences, tax losses and tax credits carried forward. Changes in the deferred taxes in the balance sheet having occurred over the financial year are recorded in the statement of comprehensive income unless they refer to items directly recognised under the equity.
Deferred taxes on the balance sheet refer to the following temporary differences:
| DEFERRED TAX ASSETS | ||
|---|---|---|
| 31-12-2013 | 31-12-2012 RESTATED | |
| Tax losses | 1 313 | 1 012 |
| Residential projects | 131 | 105 |
| TOTAL | 1 444 | 1 117 |
| DEFERRED TAX ASSETS | ||
|---|---|---|
| 31-12-2013 | 31-12-2012 RESTATED | |
| ON 1 JANUARY | 1 117 | 717 |
| Deferred tax recognised in the statement of comprehensive income | 327 | 400 |
| ON 31 DECEMBER | 1 444 | 1 117 |
| 31-12-2013 | 31-12-2012 RESTATED | |
|---|---|---|
| TEMPORARY DIFFERENCES OR TAX LOSSES FOR WHICH NO DEFERRED TAX ASSETS ARE RECOGNISED IN THE BALANCE SHEET, FROM WHICH: |
76 302 | 56 203 |
| Expiring at the end of 2013 | - | 164 |
| Expiring at the end of 2014 | 226 | 631 |
| Expiring at the end of 2015 | 623 | 1 672 |
| Expiring at the end of 2016 | 2 671 | 2 610 |
| Expiring at the end of 2017 | 1 744 | 1 514 |
| Expiring at the end of 2018 | 3 024 | 1 036 |
| Expiring at the end of 2019 | - | 2 418 |
| Not time-limited | 68 014 | 46 158 |
Inventories consist of buildings and land acquired for development and resale. Allocation of inventories by segment is as follows:
| 31-12-2013 | 31-12-2012 RESTATED | |
|---|---|---|
| Offices | 278 720 | 199 296 |
| Residential Development | 100 541 | 88 881 |
| Land Development | 85 394 | 71 747 |
| TOTAL INVENTORIES | 464 655 | 359 924 |
Allocation of inventories by geographical area is as follows:
| 31-12-2013 | 31-12-2012 RESTATED | |
|---|---|---|
| Belgium | 336 718 | 257 640 |
| Grand-Duchy of Luxemburg | 60 901 | 43 441 |
| Poland | 67 036 | 58 843 |
| TOTAL INVENTORIES | 464 655 | 359 924 |
The book value of inventories is as follows:
| 31-12-2013 | 31-12-2012 RESTATED | |
|---|---|---|
| INVENTORY AS AT 1 JANUARY | 359 924 | 327 863 |
| Purchases for the year | 130 275 | 126 183 |
| Disposals of the year | -27 210 | -96 718 |
| Borrowing costs | 1 680 | 2 944 |
| Write-offs recorded | -14 | -506 |
| Write-offs reversed | - | 158 |
| MOVEMENTS DURING THE YEAR | 104 731 | 32 061 |
| INVENTORY AS AT 31 DECEMBER | 464 655 | 359 924 |
| Book value of inventories which are pledged for bank loan securities | 431 442 | 335 913 |
Break down of the movements of the year per segment:
| PURCHASES | DISPOSALS | BORROWING COSTS | NET WRITE-OFFS | NET | |
|---|---|---|---|---|---|
| Offices | 77 946 | - | 1 489 | -11 | 79 424 |
| Residential | |||||
| Development | 31 947 | -20 475 | 191 | -3 | 11 660 |
| Land Development | 20 382 | -6 735 | - | - | 13 647 |
| TOTAL | 130 275 | -27 210 | 1 680 | -14 | 104 731 |
The purchases of the "Offices" segment mainly concern the projects Belair and Black Pearl. Purchases also include the acquisition of 33.33% of the company PEF Kons Investment, which owns the "Galerie Kons" in the Grand Duchy of Luxembourg and 50% of the company CBD International owning lands located in the Central Business District of Warsaw (see note 31).
The purchases and the sales of the "Residential" segment mainly relate to the projects Bella Vita, Charmeraie, Forum, Green Hill, Lindepark and Jardin des Sittelles. Purchases also include the acquisition of the company Euroffice 461 Leasehold, which holds the long term-lease right to the Chien Vert building situated in Woluwe-Saint-Pierre (see note 31).
Break down of the movements of the year per geographical area:
| PURCHASES | DISPOSALS | BORROWING COSTS | NET WRITE-OFFS | NET | |
|---|---|---|---|---|---|
| Belgium | 94 469 | -17 057 | 1 680 | -14 | 79 078 |
| Grand-Duchy of Luxemburg |
25 050 | -7 590 | - | - | 17 460 |
| Poland | 10 756 | -2 563 | - | - | 8 193 |
| TOTAL | 130 275 | -27 210 | 1 680 | -14 | 104 731 |
With the exception of the risks and uncertainties inherent in the activities carried out by the Group (in particular a significant increase in interest rates and credit margins, a downturn in the real estate market, changes in global economic trends, loss of interest by investors in the real estate market, a tightening of credit conditions by the banks,…) and in view of the building permits already obtained, the Board of Directors is confident that it will obtain the necessary permits to develop the Group's existing projects and is not aware, on the basis of the information currently available, of any major risks or uncertainties that could significantly damage the Group's future results.
The main risks and uncertainties are described in the Director's report.
Trade receivables refer to the following segments:
| 31-12-2013 | 31-12-2012 RESTATED | |
|---|---|---|
| Offices | 2 577 | 3 422 |
| Residential Development | 3 639 | 3 470 |
| Land Development | 2 847 | 5 924 |
| TOTAL | 9 063 | 12 816 |
The analysis of the delay of payment at the end of 2013 arises as follows :
| 31-12-2013 | 31-12-2012 RESTATED | |
|---|---|---|
| due < 3 months | 2 483 | 4 112 |
| due > 3 months < 6 months | 32 | 216 |
| due > 6 months < 12 months | 866 | 367 |
| due > 1 year | 781 | 111 |
The credit risk is related to the possible failure of the customers in respecting their commitments towards the Group.
Due to the nature of the customers, being mainly known investors, public clients or equivalent, the Group does not use instruments to cover the customer credit risk.
The customers are closely followed up and adequate impairments are recorded as to cover the amounts that are considered being not recoverable.
At 31 December 2013 there was no concentration of credit risk with a sole third party. The maximum risk amounts to the book value of the receivables.
The recorded impairments of trade receivables is as follows:
| 31-12-2013 | 31-12-2012 RESTATED | |
|---|---|---|
| BALANCE AT 1 JANUARY | 221 | 222 |
| Additions | 27 | - |
| Reversals | - | -1 |
| Reclassifications | -14 | - |
| MOVEMENTS OF THE YEAR | 13 | -1 |
| BALANCE AT 31 DECEMBER | 234 | 221 |
The components of this account are:
| 31-12-2013 | 31-12-2012 RESTATED | |
|---|---|---|
| Other receivables | 11 656 | 7 072 |
| of which: advances to joint ventures, associates and on projects in participation | 4 635 | 2 193 |
| taxes (other than income taxes) and VAT receivable | 3 248 | 2 118 |
| grants and allowances receivable | 2 255 | 1 238 |
| other | 1 518 | 1 523 |
| Deferred charges and accrued income | 3 288 | 2 768 |
| of which: on projects in developement | 2 756 | 1 873 |
| other | 532 | 895 |
| TOTAL OTHER CURRENT ASSETS | 14 944 | 9 840 |
and are related to the following segments:
| 31-12-2013 | 31-12-2012 RESTATED | |
|---|---|---|
| Offices | 7 599 | 4 849 |
| Residential Development | 4 668 | 3 499 |
| Land Development | 2 677 | 1 492 |
| TOTAL OTHER CURRENT ASSETS | 14 944 | 9 840 |
The Group's net financial debt is the balance between the cash & cash equivalents and the financial debts (current and non current). It amounts to -268 813 KEUR as at 31 December 2013 compared to -160 398 KEUR as at 31 December 2012.
| 31-12-2013 | 31-12-2012 RESTATED | |
|---|---|---|
| Cash and cash equivalents (+) | 31 394 | 26 918 |
| Non current financial debts (-) | 151 450 | 135 528 |
| Current financial debts (-) | 148 757 | 51 788 |
| NET FINANCIAL DEBT | -268 813 | -160 398 |
The Group's gearing ratio (net financial debt / equity) is 147% as at 31 December 2013 compared to 85% at the end of 2012.
Cash deposits and cash at bank and in hand amount to 31 394 KEUR compared to 26 918 KEUR at the end of 2012, representing an increase of 4 476 KEUR.
The available cash moved as follows:
| 31-12-2013 | 31-12-2012 RESTATED | |
|---|---|---|
| Term deposits with an initial duration of maximum 3 months | - | - |
| Cash at bank and in hand | 31 394 | 26 918 |
| AVAILABLE CASH AND CASH EQUIVALENTS | 31 394 | 26 918 |
The explanation of the change in available cash is given in the consolidated cash flow statement. Cash and cash equivalents are fully available, either for distribution to the shareholders or to finance projects owned by different companies.
Financial debts increase with 112 891 KEUR, from 187 316 KEUR at 31 December 2012 to 300 207 KEUR at 31 December 2013.
The components of financial debts are as follows :
| 31-12-2013 | 31-12-2012 RESTATED | |
|---|---|---|
| Bond issue maturity 21-12-2016 at 7% - nominal amount 40 MEUR | 39 523 | 39 363 |
| Bond issue maturity 28-03-2018 at 5.5% - nominal amount 60 MEUR | 58 856 | - |
| Credit institutions | 53 071 | 96 165 |
| NON CURRENT FINANCIAL DEBTS | 151 450 | 135 528 |
| Credit institutions | 146 150 | 51 788 |
| CURRENT FINANCIAL DEBTS | 146 150 | 51 788 |
| SUBTOTAL | 297 600 | 187 316 |
| Bonds - not yet due interest | 2 607 | - |
| TOTAL FINANCIAL DEBTS | 300 207 | 187 316 |
| Amount of debts guaranteed by securities | 199 221 | 147 953 |
| Book value of Group's assets pledged for debt securities | 434 045 | 338 576 |
Financial debts evolve as follows:
| 31-12-2013 | 31-12-2012 RESTATED | |
|---|---|---|
| FINANCIAL DEBTS AS AT 1 JANUARY | 187 316 | 183 678 |
| Contracted debts | 125 915 | 81 442 |
| Repaid debts | -15 631 | -77 804 |
| FINANCIAL DEBTS AS AT 31 DECEMBER | 297 600 | 187 316 |
All the financial debts are denominated in EUR.
IMMOBEL issued, in March 2013, a bond for an amount of 60 MEUR. The bonds will be redeemed in March 2018 at 100% of their principal amount and bear a coupon of 5.50%, payable annually in arrears.
Except the bonds, the financing of the Group and the financing of the Group's projects are provided based on a short-term rate, the 1 to 12 month euribor, increased by commercial margin.
IMMOBEL disposes at December 31, 2013 of 60 MEUR credit facility (corporate credit signed in May 2011), of which 13.5 MEUR used at end of December 2013, due in June 2014.
Moreover, Immobel disposes at December 31, 2013 of confirmed bank credit lines for 241 MEUR of which 186 MEUR used at end of December 2013. These credit lines (project financing credits) are specific for certain projects in development.
At December 31, 2013, the book value of Group's assets pledged to secure the corporate credit and the project financing credits amounts to 434 MEUR.
The table below summarizes the maturity of the financial liabilities of the Group:
| DUE IN | 2014 | 2015 | 2016 | 2018 | TOTAL |
|---|---|---|---|---|---|
| Bonds | - | - | 40 000 | 60 000 | 100 0001 |
| Corporate credit | 13 500 | - | - | - | 13 500 |
| Project Financing credits | 132 650 | 42 291 | 10 780 | - | 185 721 |
| TOTAL FINANCIAL DEBT | 146 150 | 42 291 | 50 780 | 60 000 | 299 221 |
110
On the basis of the situation as per 31 December 2013, each change in interest rate of 1% involves an annual increase or decrease of the interest charge on debts at variable rate of 1 992 KEUR.
In the frame of the availability of long term credits, Corporate or Project Financing, the Group uses financial instruments mainly for the hedging of interest rates.
At 31 December 2013, the derivative financial instruments have been concluded to hedge future risks and are the following:
| PERIOD | INSTRUMENTS | STRIKE | NOTIONAL AMOUNTS |
|---|---|---|---|
| 06/2011 - 06/2014 | CAP bought | 4.00% | 36 000 |
| 07/2014 - 07/2017 | CAP bought | 2.00% | 20 000 |
| 03/2010 - 03/2014 | IRS bought | 3.02% | 10 000 |
| 03/2010 - 03/2014 | IRS bought | 3.07% | 8 000 |
| 03/2010 - 03/2014 | IRS bought | 2.99% | 7 000 |
| 07/2012 - 07/2015 | IRS bought | 0.75% | 26 000 |
| 03/2012 - 03/2014 | IRS bought | 0.94% | 89 600 |
| TOTAL | 196 600 |
The fair value of derivatives is determined based on valuation models and future interest rates ("level 2"). The change in fair value of financial instruments is recognized through the statement of comprehensive income as thos have not been designated as cash flow hedges.
| 31-12-2013 | 31-12-2012 RESTATED | |
|---|---|---|
| FAIR VALUE OF FINANCIAL INSTRUMENTS | ||
| Hedging instruments: | ||
| - Bought CAP Options | 100 | 80 |
| - Bought IRS Options | -573 | -2 212 |
| TOTAL | -473 | -2 132 |
| 31-12-2013 | 31-12-2012 RESTATED | |
|---|---|---|
| CHANGE IN FAIR VALUE OF THE DERIVATIVE FINANCIAL INSTRUMENTS | ||
| SITUATION AT 1 JANUARY | -2 132 | -1 807 |
| Changes during the period: | ||
| - Premiums paid | - | 139 |
| - Change in the fair value recognised in the statement of comprehensive income | 1 659 | -464 |
| SITUATION AT 31 DECEMBER | -473 | -2 132 |
No instrument has been documented as hedge accounting at 31 December 2013.
The following table list the different classes of financial assets and liabilities with their carrying amounts in the balance sheet and their respective fair value and analyzed by their measurement category.
The fair value of financial instruments is determined as follows:
The fair value measurement of financial assets and financial liabilities can be characterized in one of the following ways:
| AMOUNTS RECOGNIZED IN BALANCE SHEET IN ACCORDANCE WITH IAS39 |
|||||
|---|---|---|---|---|---|
| LEVEL OF THE FAIR VALUE |
CARRYING AMOUNT 31-12-2013 |
AMORTIZED COST | FAIR VALUE THROUGH PROFIT OR LOSS |
FAIR VALUE 31-12-2013 |
|
| ASSETS | |||||
| Cash and cash equivalents | Level 2 | 31 394 | 31 394 | 31 394 | |
| Other non-current assets | Level 2 | 254 | 254 | 254 | |
| Trade receivables | Level 2 | 9 063 | 9 063 | 9 063 | |
| Other operating receivables | Level 2 | 14 944 | 14 944 | 14 944 | |
| TOTAL | 55 655 | 55 655 | 55 655 | ||
| LIABILITIES | |||||
| Interest-bearing debt | Levels 1 and 2 | 297 600 | 297 600 | 299 221 | |
| Trade payables | Level 2 | 20 729 | 20 729 | 20 729 | |
| Other operating payables | Level 2 | 22 435 | 22 435 | 22 435 | |
| Derivative financial instruments | Level 2 | 473 | 473 | 473 | |
| TOTAL | 341 237 | 340 764 | 473 | 342 858 |
The Company starts only new projects in case of appropriate financing by corporate, specific financing or pre-sale. As a consequence, the cash risk related to the progress of a project is very limited.
The Group is, for the majority of the mentioned financial debts, subject to a number of financial commitments. These commitments are taking into account the equity, the net financial debt and its relation with the equity and the inventories. At 31 December 2013, as for the previous years, the Group was in conformity with all these financial commitments.
The Group does not currently hedge the foreign exchange rates risks on its development activities. However, the functional currency of the offices activity currently developped in Poland has been determined to be the EUR, reducing significantly the exchange risk.
The equity amounts to 183 177 KEUR compared to 187 731 KEUR as at 31 December 2012, representing a decrease of 4 554 KEUR. The explanation of the change in equity is given in the consolidated statement of changes in equity.
IMMOBEL is optimising the structure of its permanent capital through a balance between capital and long term debts. The target is to maximise the value for the shareholder while maintaining the required flexibility to achieve the development projects. Other elements, like the expected return on each project and the respect of a number of balance sheet ratios, influence the decision taking.
The pensions and similar obligations cover the obligations of the Company as far as the group insurance is concerned. The amount recognised in the balance sheet represents the present value of obligations in terms of defined benefit pension plans less the fair value of plan assets.
| 31-12-2013 | 31-12-2012 RESTATED | |
|---|---|---|
| STATEMENT OF FINANCIAL POSITION | ||
| Present value of the defined benefit obligations | 3 420 | 2 361 |
| Fair value of plan assets at the end of the period | -2 504 | -1 676 |
| NET LIABILITY ARISING FROM DEFINED BENEFIT OBLIGATION | 916 | 685 |
| SATEMENT OF COMPREHENSIVE INCOME | ||
| Current service cost | 102 | 89 |
| Interest cost on the defined benefit obligation | 47 | 80 |
| Interest income on plan assets | - 34 | - 69 |
| Administration costs | 8 | 7 |
| DEFINED BENEFIT COSTS RECOGNIZED IN PROFIT OR LOSS | 123 | 107 |
| Actuarial (gains) / losses on defined benefit obligation arising from | ||
| - changes in demographic assumptions | - | 80 |
| - changes in financial assumptions | - 145 | 295 |
| - experience adjustments | 353 | - 45 |
| REMEASUREMENTS OF NET DEFINED BENEFIT LIABILITY RECOGNISED IN OTHER COMPREHENSIVE INCOME |
208 | 330 |
| DEFINED BENEFIT COSTS | 331 | 437 |
| PRESENT VALUE OF THE OBLIGATIONS AS AT 1 JANUARY | 2 361 | 2 240 |
| Current service cost | 102 | 89 |
| Interest cost | 47 | 80 |
| Contributions from plan participants | 23 | 27 |
| Actuarial (gains) losses | 967 | 293 |
| Benefits paid | - 80 | - 368 |
| PRESENT VALUE OF THE OBLIGATIONS AS AT 31 DECEMBER | 3 420 | 2 361 |
| FAIR VALUE OF THE PLAN ASSETS AS AT 1 JANUARY | 1 676 | 1 901 |
| Interest income | 34 | 69 |
| Contributions from employer | 100 | 91 |
| Contributions from plan participants | 23 | 27 |
| Benefits paid | - 80 | - 368 |
| Actuarial (gains) losses | 759 | - 37 |
| Administration costs | - 8 | - 7 |
| FAIR VALUE OF THE PLAN ASSETS AS AT 31 DECEMBER | 2 504 | 1 676 |
| CONTRIBUTION OF THE EMPLOYER EXPECTED FOR 2014/2013 | 91 | 76 |
| 3.50% | 3.50% |
|---|---|
| 2.00% | 2.00% |
| MR / FR -3 | |
| MR / FR -3 |
| SENSITIVITY ANALYSIS OF THE DBO 31-12-2013 | |||
|---|---|---|---|
| Discount rate | 2.50% | 3.00% | 2.00% |
| Amount of the DBO | 3 420 | 3 285 | 3 565 |
The pension plans are funded through a group insurance. The underlying assets of the insurance contracts are primarily invested in bonds. The actuarial loss recognized in the statement of other comprehensive income equals -208 KEUR.
The accumulated amount of actuarial gains and losses recognized in other comprehensive income equals -154 KEUR.
Historical review of the key figures of the four last years:
| 2013 | 2012 | 2011 | 2010 |
|---|---|---|---|
| 3 420 | 2 361 | 2 200 | 2 222 |
| 2 504 | 1 676 | 1 901 | 1 876 |
| 916 | 685 | 299 | 346 |
| -968 | 77 | 223 | 136 |
| 760 | -50 | -50 | -51 |
The components of provisions are as follows:
| 31-12-2013 | 31-12-2012 RESTATED | |||
|---|---|---|---|---|
| Provisions related to the sales | 1 154 | 1 620 | ||
| Other provisions | 171 | 176 | ||
| TOTAL PROVISIONS | 1 325 | 1 796 | ||
| RELATED TO THE SALES |
OTHER | |||
| PROVISIONS AS AT 1 JANUARY | 1 620 | 176 | 1 796 | 4 476 |
| Increase | 155 | 24 | 179 | 400 |
| Use | -3 | -29 | -32 | -1 580 |
| Reversal | -618 | - | -618 | -1 500 |
| CHANGES FOR THE YEAR | -466 | -5 | -471 | -2 680 |
| PROVISIONS AS AT 31 DECEMBER | 1 154 | 171 | 1 325 | 1 796 |
| From which current provisions | 1 154 | 141 | 1 295 | 1 785 |
Allocation of this position by segment is as follows:
31-12-2013 31-12-2012 RESTATED
| Offices | 1 135 | 1 004 |
|---|---|---|
| Residential Development | 95 | 697 |
| Land Development | 95 | 95 |
| TOTAL | 1 325 | 1 796 |
| Changes of the provisions for the year | -471 | -2 680 |
| Changes of the provisions linked to employee benefit obligations | 23 | 16 |
| Changes of the provisions (consolidated statement of cash flow) | -448 | -2 664 |
These provisions made correspond to the best estimate of outgoing resources considered as likely by the Board of Directors. The Group has no indication on the final amount of disbursement or the timing of the disbursement, it depends on court decisions.
The provisions are made up based on the risks related to the sales and to the litigations, in particular when the recognition conditions of those liabilities are met. The provisions related to the sales mainly consist of rental guarantees, good end of execution...
No provision has been recorded for the other litigations that mainly concern:
I problems of decennial guarantee for which the Group has recourse on the contractor who is generally covered by an insurance of "decennial liability coverage" for this purpose,
I pure administrative recourses concerning planning and environmental permits introduced by third parties at the State Council without any financial consequence for the Group.
This account is allocated by segment as follows:
31-12-2013 31-12-2012 RESTATED Offices 11 861 13 893 Residential Development 4 793 5 231 Land Development 4 075 2 385 TOTAL TRADE PAYABLES 20 729 21 509
The components of this account are:
| 31-12-2013 | 31-12-2012 RESTATED | |
|---|---|---|
| Personnel debts | 523 | 736 |
| Taxes (other than income taxes) and VAT payable | 1 266 | 5 093 |
| Advance on sales (mainly related to residential projects) | 8 683 | 715 |
| Advances from joint ventures and associates | 3 093 | 1 436 |
| Accrued charges and deferred income | 631 | 1 410 |
| Operating grants | 3 459 | 2 263 |
| Other | 2 173 | 3 321 |
| TOTAL OTHER CURRENT LIABILITIES | 19 828 | 14 974 |
Other current liabilities are related to the following segments:
| 31-12-2013 | 31-12-2012 RESTATED | |
|---|---|---|
| Offices | 5 089 | 8 671 |
| Residential Development | 13 632 | 3 943 |
| Land Development | 1 107 | 2 360 |
| TOTAL | 19 828 | 14 974 |
Trade receivables and payables and other receivables and payables1:
| 31-12-2013 | 31-12-2012 RESTATED | |
|---|---|---|
| Trade receivables | 9 063 | 12 816 |
| Other current assets | 14 944 | 9 840 |
| TOTAL OF TRADE RECEIVABLES AND OTHER CURRENT ASSETS | 24 007 | 22 656 |
| Trade payables | 20 729 | 21 509 |
| Other current liabilities | 19 828 | 14 974 |
| TOTAL OF TRADE PAYABLES AND OTHER CURRENT LIABILITIES | 40 557 | 36 483 |
| NET SITUATION OF RECEIVABLES AND PAYABLES | -16 550 | -13 827 |
The change in working capital by nature is established as follows:
| 31-12-2013 | 31-12-2012 RESTATED | |
|---|---|---|
| Inventories, including acquisition and sales of entities that are not considered as business combinations |
-100 808 | -30 765 |
| Trade receivables & Other current assets | -3 668 | 3 467 |
| Trade payables & Other current liabilities | 3 909 | 5 573 |
| CHANGE IN WORKING CAPITAL | -100 567 | -21 725 |
Changes by segment are described under note 1 (financial information by segment).
| 31-12-2013 | 31-12-2012 RESTATED | |
|---|---|---|
| Guarantees from third parties on behalf of the Group with respect to: | ||
| - inventories | 82 049 | 42 836 |
| - construction contracts | - | 215 |
| - other assets | 111 | 111 |
| TOTAL GUARANTEES FROM THIRD PARTIES ON BEHALF OF THE GROUP | 82 160 | 43 162 |
| These guarantees consist of: | ||
| - guarantees "Real estate trader" (acquisitions with registration fee at reduced rate) | 13 400 | 13 615 |
| - guarantees "Law Breyne" (guarantees given in connection with the sale of houses or apartments under construction) |
45 877 | 11 667 |
| - guarantees "Good end of execution" (guarantees given in connection with the execution of works) |
20 257 | 17 769 |
| - guarantees "Payment" and "Other" (successful completion of payment, rental) | 2 626 | 111 |
| TOTAL | 82 160 | 43 162 |
| Mortgage power - Amount of inscription | 102 631 | 59 631 |
| Book value of Group's assets pledged for debt securities related to investment property and inventory as a whole |
434 045 | 338 576 |
| BOOK VALUE OF PLEDGED GROUP'S ASSETS | 434 045 | 338 576 |
| Amount of debts guaranteed by above securities | ||
| - Non current debts | 53 071 | 96 165 |
| - Current debts | 146 150 | 51 788 |
| TOTAL | 199 221 | 147 953 |
| Commitments for the acquisition of inventories | 13 141 | 21 412 |
| Commitments for the disposal of inventories | 138 407 | 11 199 |
| The commitments from which the value of acquisition or disposal can not be defined, because depending from future events (permit to obtain, number of m² to construct…), are not included. |
The list of subsidiaries, joint ventures and associates is included under note 31.
The transactions between IMMOBEL, subsidiaries and joint ventures are eliminated in consolidation. The relationships with associates consist mainly of loans or advances, whose amounts are recorded in the balance sheet in the following accounts:
| 31-12-2013 | 31-12-2012 RESTATED | |
|---|---|---|
| Other current assets | 1 181 | 1 253 |
| 31-12-2013 | 31-12-2012 RESTATED | |
|---|---|---|
| Cresida Investment S.à r.l. | 29.85% | 24.99% |
| Capfi Delen Asset Management n.v. | 5.06% | 5.06% |
| JER Audrey S.à.r.l. | - | 5.53% |
| Fidea n.v. | - | 3.46% |
| Other | 65.09% | 60.95% |
| Number of representative capital shares | 4 121 987 | 4 121 987 |
These are the remuneration of members of the Management Committee, of the Executive Committee and of the Board of Directors.
| 31-12-2013 | 31-12-2012 RESTATED | |
|---|---|---|
| Salaries | 3 907 | 3 635 |
| Post-employment benefits | 99 | 91 |
| Other Benefits | 6 | 9 |
| TOTAL | 4 012 | 3 735 |
| 31-12-2013 | 31-12-2012 RESTATED | |
|---|---|---|
| Amounts recognized as income - Services fees | 555 | 1 007 |
| Amounts recognized as income - Asset sales | - | 491 |
| Amounts recognized as expenses | 507 | 472 |
| Amounts capitalized on inventories | - | 200 |
| Amounts due to related parties | 263 | 124 |
| Amounts due by related parties | 149 | 102 |
On 10 March 2014, IMMOBEL solds its stake of 40% IN RAC 1 SA, the company holding the first phase of the Belair project. Except this sale, no significant event that may have an impact on the financial statements occurred from the reporting date on 31st December 2013 up to 27th March 2014 when the financial statements were approved by the Board of Directors.
The companies jointly controlled are listed under note 31. The participating interests of the Group in these companies are reported using the proportionate consolidation method grouping the accounts line by line.
From 1 January 2014, following the application of IFRS 11, the joint ventures will be consolidated using the equity method.
This change of method has the following impact on the consolidated statement of financial position as at 31-12-2013 :
| 31-12-2013 | IMPACT IFRS 11 |
31-12-2013 RESTATED |
|
|---|---|---|---|
| NON-CURRENT ASSETS | 6 517 | 31 538 | 38 055 |
| Investments in associates | 1 097 | 32 391 | 33 488 |
| Other non-current assets | 5 420 | -853 | 4 567 |
| CURRENT ASSETS | 520 447 | -156 278 | 364 169 |
| Inventories | 464 655 | -179 721 | 284 934 |
| Trade receivables | 9 063 | -2 723 | 6 340 |
| Other current assets | 15 335 | 41 074 | 56 409 |
| Cash and cash equivalents | 31 394 | -14 908 | 16 486 |
| TOTAL ASSETS | 526 964 | -124 740 | 402 224 |
| 31-12-2013 | IMPACT IFRS 11 |
31-12-2013 RESTATED |
|
|---|---|---|---|
| TOTAL EQUITY | 183 177 | - | 183 177 |
| NON-CURRENT LIABILITIES | 152 396 | -13 071 | 139 325 |
| Financial debts | 151 450 | -13 071 | 138 379 |
| Other non-current liabilities | 946 | - | 946 |
| CURRENT LIABILITIES | 191 391 | -111 669 | 79 722 |
| Financial debts | 148 757 | -94 019 | 54 738 |
| Trade payables | 20 729 | -8 515 | 12 214 |
| Other current liabilities | 21 905 | -9 135 | 12 770 |
| TOTAL LIABILITIES | 526 964 | -124 740 | 402 224 |
Companies forming part of the Group as at 31 December 2013:
| NAME | COMPANY NUMBER | REGISTERED OFFICE | % INTEREST1 |
|---|---|---|---|
| Cedet | - | Warsaw | 100.00 |
| Compagnie Immobilière de Participations Financières (CIPAF) |
0454 107 082 | Brussels | 100.00 |
| Compagnie Immobilière de Wallonie (CIW) | 0401 541 990 | Wavre | 100.00 |
| Compagnie Immobilière Luxembourgeoise | - | Luxemburg | 100.00 |
| Entreprise et Gestion Immobilières (Egimo) | 0403 360 741 | Brussels | 100.00 |
| Espace Nivelles | 0472 279 241 | Brussels | 100.00 |
| Euroffice 461 Leasehold | 0897 498 339 | Brussels | 100.00 |
| Foncière Jennifer | 0464 582 884 | Brussels | 100.00 |
| Foncière Montoyer | 0826 862 642 | Brussels | 100.00 |
| Garden Point | - | Warsaw | 100.00 |
| IMMOBEL pol and |
- | Warsaw | 100.00 |
| Immobiliën Vennootschap van Vlaanderen | 0403 342 826 | Brussels | 100.00 |
| Immo-Puyhoek | 0847 201 958 | Brussels | 100.00 |
| Katavia Invesment | - | Warsaw | 100.00 |
| Les Jardins du Nord | 0444 857 737 | Brussels | 96.20 |
| Lotinvest Development | 0417 100 196 | Brussels | 100.00 |
| Okrąglak Development | - | Warsaw | 100.00 |
| Quomago | 0425 480 206 | Brussels | 100.00 |
| SPI Parc Seny | 0478 120 522 | Brussels | 100.00 |
| The Green Corner | 0443 551 997 | Brussels | 100.00 |
| Torres Investment | - | Warsaw | 100.00 |
| Veldimmo | 0430 622 986 | Brussels | 100.00 |
| WestSide | - | Luxemburg | 100.00 |
| NAME | COMPANY NUMBER | REGISTERED OFFICE | % INTEREST1 |
|---|---|---|---|
| Bella Vita | 0890 019 738 | Brussels | 50.00 |
| CBD International | - | Warsaw | 50.00 |
| Château de Beggen | - | Luxemburg | 50.00 |
| Espace Trianon | 0450 883 417 | Embourg | 50.00 |
| Fanster Enterprise | - | Warsaw | 50.00 |
| Foncière du Parc | 0433 168 544 | Brussels | 50.00 |
| Gateway | 0501 968 664 | Brussels | 50.00 |
| Ilot Ecluse | 0441 544 592 | Gilly | 50.00 |
| Intergénérationnel de Waterloo | 0890 182 460 | Brussels | 50.50 |
| Pef Kons Investment | - | Luxemburg | 33.33 |
| RAC 1 | 0819 582 791 | Antwerp | 40.00 |
| RAC 2 | 0819 585 959 | Antwerp | 40.00 |
| RAC 3 | 0819 588 830 | Antwerp | 40.00 |
| RAC 4 | 0819 593 481 | Antwerp | 40.00 |
| Société Espace Léopold | 0435 890 977 | Brussels | 50.00 |
| Temider Enterprise | - | Warsaw | 50.00 |
| Universalis Park | 0891 775 438 | Brussels | 50.00 |
| Vilpro | 0437 858 295 | Brussels | 50.00 |
| NAME | COMPANY NUMBER | REGISTERED OFFICE | % INTEREST1 |
|---|---|---|---|
| DHR Clos du Château | 0895 524 784 | Brussels | 33.33 |
| Espace Midi | 0402 594 342 | Brussels | 20.00 |
| Promotion Léopold | 0439 904 896 | Brussels | 35.50 |
| 31-12-2013 | 31-12-2012 RESTATED | |
|---|---|---|
| Subsidiaries - Global method of consolidation | 23 | 24 |
| Joint ventures - Proportionate method of consolidation | 18 | 16 |
| Associates - Equity method | 3 | 3 |
| TOTAL | 44 | 43 |
During the year 2013, following changes in the consolidation perimeter occurred:
I Pef Kons Investment (Grand-Duchy of Luxemburg) - acquisition of 33.33% of shares of the company,
I CBD International sp. Z.o.o. (Poland) - acquisition of 50% of shares of the company,
I Euroffice 461 Leasehold - acquisition of 100% of shares of the company.
31-12-2013 Inventories 34 597 Other assets 407 Cash and cash equivalents 195 TOTAL ASSETS 35 199 Other liabilities 3 470 TOTAL LIABILITIES 3 470 PAID PRICE 31 729 Purchase price paid in cash -31 729 Acquired cash 195 OPERATING CASH FLOW -31 534
The acquisitions are not recognized as business combinations under IFRS 3 since the acquired assets and liabilities are not activities ("business"). The acquired assets and liabilities are therefore accounted for using the applicable standard (mainly IAS 2 - "Stock"). The cash outflows linked to the acquisitions of such project companies are classified as operating cash flows.
I Project Papeblok - 100% holding - merged by absorption by IMMOBEL, I Compagnie Immobilière de Lotissements (Lotinvest) - 100% holding - merged by absorption by IMMOBEL.
The sales of project companies are considered as part of the normal business of the group and are therefore recorded as turnover and cost of sales. They are part of the operating cash flow. This accounting treatment is consistent with the purchase of project companies as described above.
The undersigned persons state that, to the best of their knowledge:
On behalf of the Board of Directors:
GAËTAN PIRET sprl Baron Buysse CMG CBE Chief Executive Officer Chairman of the Board of Directors
As required by law, we report to you in the context of our appointment as the company's statutory auditor. This report includes our report on the consolidated financial statements together with our report on other legal and regulatory requirements. These consolidated financial statements comprise the consolidated statement of financial position as at 31 December 2013, the consolidated statement of comprehensive income, the consolidated statement of changes in equity and the consolidated statement of cash flows for the year then ended, as well as the summary of significant accounting principles and methods and notes to the consolidated financial statements.
We have audited the consolidated financial statements of Compagnie Immobilière de Belgique, en abrégé: Immobel SA ("the company") and its subsidiaries (jointly "the group"), prepared in accordance with International Financial Reporting Standards as adopted by the European Union and with the legal and regulatory requirements applicable in Belgium.
The consolidated statement of financial position shows total assets of 526.964 (000) EUR and the consolidated statement of comprehensive income shows a consolidated profit (group share) for the year then ended of 1.471 (000) EUR.
The board of directors is responsible for the preparation and fair presentation of consolidated financial statements in accordance with International Financial Reporting Standards (IFRS) as adopted by the European Union and with the legal and regulatory requirements applicable in Belgium, and for such internal control as the board of directors determines is necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.
Our responsibility is to express an opinion on these consolidated financial statements based on our audit. We conducted our audit in accordance with International Standards on Auditing (ISA). Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the consolidated financial statements. The procedures selected depend on the statutory auditor's judgment, including the assessment of the risks of material misstatement of the consolidated financial statements, whether due to fraud or error. In making those risk assessments, the statutory auditor considers internal control relevant to the group's preparation and fair presentation of the consolidated financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the group's internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the board of directors, as well as evaluating the overall presentation of the consolidated financial statements. We have obtained from the group's officials and the board of directors the explanations and information necessary for performing our audit.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
In our opinion, the consolidated financial statements of Compagnie Immobilière de Belgique, en abrégé: Immobel SA give a true and fair view of the group's net equity and financial position as of 31 December 2013, and of its results and its cash flows for the year then ended, in accordance with International Financial Reporting Standards as adopted by the European Union and with the legal and regulatory requirements applicable in Belgium.
The board of directors is responsible for the preparation and the content of the directors' report on the consolidated financial statements.
As part of our mandate and in accordance with the Belgian standard complementary to the International Standards on Auditing applicable in Belgium, our responsibility is to verify, in all material respects, compliance with certain legal and regulatory requirements. On this basis, we make the following additional statement, which does not modify the scope of our opinion on the consolidated financial statements:
I The directors' report on the consolidated financial statements includes the information required by law, is consistent with the consolidated financial statements and is free from material inconsistencies with the information that we became aware of during the performance of our mandate.
Diegem, 28 March 2014
The statutory auditor
DELOITTE Bedrijfsrevisoren / Reviseurs d'Entreprises BV o.v.v.e. CVBA / SC s.f.d. SCRL Represented by Laurent Boxus
The financial statements of the parent company, IMMOBEL SA, are presented below in a condensed form.
In accordance with Belgian company law, the Directors' Report and Financial Statements of the parent company, IMMOBEL SA, together with the Statutory Auditor's Report, have been filed at the National Bank of Belgium.
They are available on request from:
IMMOBEL SA Rue de la Régence 58 BE-1000 Brussels Belgium www.immobel.be
The statutory auditor issued an unqualified report on the financial statements of IMMOBEL SA.
| 31-12-2013 | 31-12-2012 | |
|---|---|---|
| ASSETS | ||
| FIXED ASSETS | 104 842 | 93 936 |
| Start-up costs | 1 621 | 637 |
| Intangible fixed assets | 95 | 36 |
| Tangible fixed assets | 1 334 | 1 565 |
| Financial fixed assets | 101 792 | 91 698 |
| CURRENT ASSETS | 260 604 | 176 264 |
| Amounts receivable after one year | 100 | - |
| Stocks and contracts in progress | 106 625 | 39 879 |
| Amounts receivable within one year | 144 715 | 128 930 |
| Cash balance | 8 423 | 7 086 |
| Deferred charges and accrued income | 741 | 369 |
| TOTAL ASSETS | 365 446 | 270 200 |
| LIABILITIES | ||
| SHAREHOLDERS' EQUITY | 192 981 | 189 467 |
| Capital | 60 302 | 60 302 |
| Reserves | 10 076 | 10 076 |
| Accumulated profits | 122 603 | 119 089 |
| PROVISIONS AND DEFERRED TAXES | 640 | 1 035 |
| Provisions for liabilities and charges | 640 | 1 035 |
| DEBTS | 171 825 | 79 698 |
| Amounts payable after one year | 142 515 | 50 000 |
| Amounts payable within one year | 26 611 | 29 628 |
| Accrued charges and deferred income | 2 699 | 70 |
| TOTAL LIABILITIES | 365 446 | 270 200 |
| 31-12-2013 | 31-12-2012 | |
|---|---|---|
| Operating income | 17 370 | 14 931 |
| Operating charges | -13 017 | -11 070 |
| OPERATING PROFIT | 4 353 | 3 861 |
| Financial income | 7 146 | 7 979 |
| Financial charges | -8 494 | -5 396 |
| FINANCIAL RESULT | -1 348 | 2 583 |
| OPERATING PROFIT BEFORE TAXES | 3 005 | 6 444 |
| Extraordinary income | 2 710 | 5 216 |
| Extraordinary charges | -2 199 | -65 |
| EXTRAORDINARY RESULT | 511 | 5 151 |
| PROFIT OF THE FINANCIAL YEAR BEFORE TAXES | 3 516 | 11 595 |
| Taxes | -2 | -3 |
| PROFIT OF THE FINANCIAL YEAR | 3 514 | 11 592 |
| PROFIT OF THE FINANCIAL YEAR TO BE APPROPRIATED | 3 514 | 11 592 |
| 31-12-2013 | 31-12-2012 | |
|---|---|---|
| PROFIT TO BE APPROPRIATED | 122 603 | 124 860 |
| Profit for the financial year available for appropriation | 3 514 | 11 592 |
| Profit carried forward | 119 089 | 113 268 |
| RESULT TO BE CARRIED FORWARD | 122 603 | 119 089 |
| Profit to be carried forward | 122 603 | 119 089 |
| PROFIT AVAILABLE FOR DISTRIBUTION | 0 | 5 771 |
| Dividends | 0 | 5 771 |
Tangible assets are recorded as assets net of accumulated depreciation, at either their cost price or contribution value (value at which they were brought into the business), including ancillary costs and non-deductible VAT. Depreciation is calculated by the straight line method. The main depreciation rates are the following:
| I Buildings | 3% |
|---|---|
| I Buildings improvements | 5% |
| I Office furniture and equipment | 10% |
| I Computer equipment | 33% |
| I Vehicles | 20% |
Financial Fixed Assets are entered either at their purchase price, after taking into account any amounts still not paid up and any write-offs made. They are written down if they suffer a capital loss or a justifiable long-term loss in value.
Amounts Receivable within one year and those receivable after one year are recorded at their nominal value. Write-downs are applied in case of permanent impairment or if the repayment value at the closing date is less than the book value.
Stocks are recorded at their purchase price or contribution value, including, in addition to the purchase price, the ancillary costs, duties and taxes relating to them. The infrastructure costs are recorded at their cost price. Realisation of stocks is recorded at the weighted average price. Work in progress is valued at cost price. Profits are, in principle, recorded on the basis of the percentage of completion of the work. Write-downs are applied as appropriate, according to the selling price or the market value. The sales and the purchases of properties are recorded at the signature of the notarial act in so far as the eventual conditions precedents are lifted and a clause of deferred property transfer is foreseen in the compromise under private signature
Short term investments are recorded as assets at their purchase price (ancillary costs excluded) or contribution value. Their values are adjusted, provided that the depreciation is lasting.
Cash at bank and in hand are recorded at their nominal value. Values are adjusted if the estimated value at the end of the financial year is lower than the book value.
At the close of each financial year, the Board of Directors, acting with prudence, sincerity and in good faith, examines the provisions to be set aside to cover the major repairs or major maintenance and the risks arising from completion of orders placed or received, advances made, technical guarantees after sale or delivery and current litigations.
Amounts Payable are recorded at their nominal value.
IMMOBEL
Rue de la Régence, 58 -1000 Brussels - Belgium RPM / RPR (Legal Entitites Register) - VAT BE 0405.966.675
Belgian registered joint stock company, constituted on 9 July 1863, authorised by the Royal Decree of 23 July 1863.
Indefinite
(Art. 12 of the Articles of Association – excerpt)
Any physical or moral person who acquires securities in the Company, whether representative of capital or not, conferring the right to vote, must declare to the Company and to the Belgian Banking, Finance and Insurance Commission the number of securities s/he holds, when the voting rights pertaining to these securities reach the level of three percent or more of the total voting rights that exist.
She/he must make the same declaration in the event of an additional acquisition of securities referred to in paragraph 1, if when this acquisition is completed, the voting rights pertaining to the securities that she/he possesses reach the level of five, ten, fifteen percent, and so on in tranches of five points, of the total number of existing voting rights.
He must make the same declaration in the event of disposal of securities when, following the disposal, his voting rights are reduced to below one of the thresholds referred to in paragraph 1 or paragraph 2.
When a physical or moral person acquires or transfers control, be it direct or indirect, de jure or de facto, of a company which possesses three percent at least of the voting power of the company, she/he must declare this to the company and to the Banking, Financial and Insurance Commission. The aforementioned declarations must be addressed to the Banking, Financial and Insurance Commission, as well as to the Company, at the latest on the second work day after the completion of the acquisition or transfer concerned, without prejudice to the special legal provisions regarding securities acquired by succession.
www.immobel.be
Publication of annual accounts 2013: 28 March 2014 Ordinary General Meeting 2014: 22 May 2014 Publication of 2014 half-year results: 29 August 2014 Publication of 2014 annual accounts: 27 March 2015 Ordinary General Meeting 2015: 28 May 2015
I BNP Paribas Fortis I KBC Bank I ING Belgique I Bank Degroof
Philippe Opsomer Tel.: 32(0)2/422.53.61 - Fax: 32(0)2/422.53.02 E-mail: [email protected]
Lindsay Edwards – Christine Leroy
Snel
www.chriscom.eu
Gabari (Advanced Real Estate Communication - www.gabari. be) – Christian Bauer & Associés Architectes + Digital Studio – Studio Arne Quinze – M3 Architectes – Jaspers-Eyers Architects - A2RC Architects – DS-Architecture – A2RC Achitects – Art & Build Architects – Rhode Kellerman Wawrowsky & Andrzej M. Choldzynski – KiR Architekci – Pierre Accarain - Marc Bouillot Architectes Associés – HC Demytteraere Architectenbureau – Rademacker & Schoffers Architecten – Fly By Amazing Aerial Imagery.
The 3D projections are displayed only as indications, and present no legal obligation.
IMMOBEL does its utmost to respect the legal prescriptions related to copy-rights. It kindly invites any person whose rights may have been infringed to contact the Company.
This report is available in English, in Dutch and in French. Dit verslag is beschikbaar in het Nederlands, in het Frans en in het Engels. Ce rapport est disponible en français, en néerlandais et en anglais.
The original text of this report is in French. De oorspronkelijke tekst van dit verslag is in het Frans. Le texte original de ce rapport est en français.
DISCOVER ALSO THE ONLINE VERSION OF THIS REPORT: HTTP://ANNUALREPORT. IMMOBEL.BE
IMMOBEL Limited company Rue de la Régence, 58 - 1000 Brussels - Belgium
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