Quarterly Report • Aug 19, 2008
Quarterly Report
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NOTICE Audited/Unaudited All numbers presented in this report are unaudited with the exception of those dated 31 Dec. 2007
| 4 KEY FIGURES |
|---|
| ------------------ |
Letter from the Board
| (in EUR m) | 1 Jan. - 30 Jun. 2008 | 1 Jan. - 30 Jun. 2007 | Change |
|---|---|---|---|
| Revenues | 49.6 | 39.1 | 27.0% |
| EBITDA | 13.2 | 74.5 | -82.3% |
| EBT | -10.3 | 56.5 | -118.3% |
| Consolidated profit for the period | -10.4 | 44.1 | -123.6% |
| FFO | 20.4 | 12.8 | 59.8% |
| NAV/share | 15.1 | 15.6 | -3.0% |
| NNNAV/share | 15.1 | 15.6 | -3.0% |
| 30 Jun. 2008 | 31 Dez. 2007 | Change | |
| Equity | 844.5 | 870.9 | -3.02% |
| Liabilities | 1,127.1 | 964.6 | 16.84% |
| Total assets | 1,971.6 | 1,835.5 | 7.41% |
| Equity ratio | 42.8% | 47.4% | -4.6pp |
| SHARE | |
|---|---|
| ISIN | DE000A0LD2U1 |
| Symbol | AOX |
| Prime Sector | Financial Services |
| Industry Group | Real Estate |
| Market Segment | Prime Standard, Frankfurt |
| Indices | S-DAX, EPRA, German REIT Index, S&P/Citigroup Global REIT Index |
| Share Capital (notional) | EUR 56,000,000 |
| Market Capitalization (June 30)1 | EUR 588,000,000 |
| Issued Shares | 56,000,000 |
| Treasury Shares (June 30) | 1,375,755 |
| Shares outstanding (June 30) | 54,624,245 |
| Free Float | 46 % |
1 Market Capitalization calculated with all 56 million shares as basis.
Letter from the Board
Dear Shareholders and Business Partners, Ladies and Gentlemen
The half year result of your company shows strong performance in its operations, with increasing funds from operations (FFO) up 60% from 12,787 in H1 2007 to 20,430 in H1 2008. Given that the achievement of alstria´s financial plan in 2008 does not depend on trading results and thus, is not impacted by the situation in the direct investment markets we can confirm our financial guidance of EUR 101 Mio in turnover and EUR 40 Mio of funds from operations. The year on year increase in the FFO is driven by the first time consolidation of the last acquired portfolios but also by our asset management results as well as the reduction in our overall administrative costs.
We have used the time of slowing real estate acquisitions in order to specify our financing strategy for the future. It is alstria's aim to switch overtime its existing syndicated loan of EUR 1.1 billion for other sources of financing that will be adjusted in terms of leverage and maturity to the specifics of the underlying assets´ business plan. We have started to implement this strategy as we have agreed on a new EUR 95 millions, 7 years, non recourse loan on two of our long term lease assets. This transaction allows us to keep the total net debt of the company constant, but have increased the average maturity of our loan by 4 month (from 3.4 years to 3.7 years), at a marginal financing cost increase of 9 bps (the average cost of debt moving from 4.45% to 4.54 %). Although this specific transaction is only the first step of a global plan to better align the maturity of our debt with the maturity of our assets between now and 2011, we believe it also helps to address some short term concerns with regards to the ability of real estate companies to raise or refinance debt in the current market. This financing clearly demonstrates that there is today in Germany sufficient liquidity in the debt market to finance high quality assets at attractive terms.
With a net loan to value ratio of 58.5% alstria is today among the most conservative financed company in the German listed sector. With an average lease maturity of 10 years, it is today the German company with the best secured income.
It is alstria's policy to revalue its portfolio by a third party external appraiser on an annual basis. We have taken this decision on the bases that the movement in direct real estate prices was relatively slow, and that volatility within one year is fairly limited. However, given the significant changes in the global environment, the uncertainties, the questions raised by analyst and investors, as well as rational and sometime irrational belief in what is happening in the real estate market place, we have decided to go for a full valuation of the portfolio for this half year report. The result of this exercise is a decrease of the overall value of our portfolio by EUR 29.8 million which negatively impacts our profit and loss statement.
The overall yield expansion applied by Colliers CRE, alstria's valuer, was 32 bps across the portfolio. Based on Colliers assessment of the yield expansion the total value of the portfolio would have dropped by around EUR 70 millions (or 3.7% of the total value). This negative valuation result was partially offset by asset management results on the portfolio for around EUR 12,5 million and increases in rental income linked to the indexation of around 35% of our leases.
The valuation adjustments lead to an overall valuation yield of the portfolio of 5.6%, and a total of investment properties of EUR 1,878 billion.
We have started in the beginning of the summer the
1 Net Loan To Value Ratio: Net debt / Real Estate Property
2 Yield expansion corrected by the early termination of the BKK Mobil oil lease in Hamburg
Key Figures I Introduction I alstria-Share I Management Report I Consolidated Financial Statements I FFO I Notes I Appendix I
Letter from the Board
sale process of a limited number of small assets, as part of our disposal process for the year. The assets that are offered for sale on an asset per asset basis are usually assets which are too small for alstria to efficiently handle or with limited potential.
Since the signature of the joint venture on the Alte Post property which was completed on July 25 2008, we have entered into three sale and purchase agreements which are still subject to the market standard condition precedents. The three assets sold are a plot of land in Hanover, one asset in the outskirts of Hamburg, rented on a long term basis to the city of Hamburg sold at a NOI yield on cost of 4.5% and an asset in the city centre of Hamburg sold with a remaining two year lease at a NOI yield of 4.75%. Theses sales were realized at a profit to both 31/12/07, and 30/06/08 book values, and on aggregate represent a net gain of around EUR 2.6 millions or 18% above the latest IFRS values. With those sales and taking into accounts the JV signed on Alte-Post, alstria has agreed to dispose so far EUR 34.6 millions worth of assets.
With kind regards
Alexander Dexne Olivier Elamine
Chief Financial Officer Chief Executive Officer
alstria's share price proved to be stable compared to the beginning of the year. Although being rather volatile, alstria's share price on June 30, 2008, closed at EUR 10.50 slightly above the level it was traded in the end of 2007 (EUR 10.25 closing price). This result exceeded its reference indices and the SDAX by far.
For the reporting period this is an increase in alstria's share price by +2,4%, outperforming the development of the EPRA/EUROPE index (-20%) and the EPRA Germany Index (-35%).
Though improving compared to the beginning of the year, our share price shows a downward swing in the second quarter of the term. alstria's shares are trading at a significant discount to their Triple Net Asset Value of EUR 15,08 (December 31, 2007: EUR 15,55).
At balance sheet date alstria owns 1,375,755 treasury shares due to the buy back program started in November last year.
For the time being it is intended to hold the acquired shares as treasury stock and eventually use them according to the authorization of the shareholders meeting. Potential uses may include using the shares in future acquisition projects, or resell them in the market.
The General Meeting of alstria on June 5, 2008 resolved to distribute a dividend of EUR 28,400k (EUR 0,52 per outstanding share). The dividend was distributed on June 6, 2008.
I Introduction I alstria-Share I Management Report I I FFO I Notes I Appendix I Consolidated Financial Statements
Portfolio Overview > Earnings Position
Financial and Asset Position
Risk and Opportunity Report
Recent Development and Outlook
The announced acquisitions in Q4 2007 have been closed in the first quarter of 2008. In the second quarter alstria acquired a vacant office property located in Hamburg. It has a total lettable area of approximately 3,100 sqm for an all in cost of approximately EUR 4.6 million (approximately EUR 1,485 per sqm). This acquisition has been funded through the company's cash flow.
With these transactions the portfolio has been extended by 19 properties and approx. 138,000 sqm lettable area across Germany. alstria now manages a portfolio of 92 properties and approx. 953,000 sqm. The total portfolio vacancy rate increased slightly to around 7.6% which corresponds to approx. 73,000 sqm. The increased vacancy is mainly driven by the execution of an early termination agreement with BKK Mobil Oil in Hamburg (approximately 10.500 sqm were vacated one year in advance and alstria received EUR 1,000 k in compensation) and the acquisition of a 3,100 sqm vacant office building in Hamburg. This vacancy was partly compensated by new lease-ups of 7,000 sqm. The Weighted Average Unexpired Lease Length of the portfolio is above 10 years. For a detailed description of the alstria portfolio please refer to our annual report 2007.
1 Based on net lettable area
2 Based on passing rent
Portfolio Overview
Earnings Position
Financial and Asset Position > Risk and Opportunity Report
Recent Development and Outlook
Also in the first six month of 2008 alstria was able to further increase revenues and improve operating efficiency. Revenues were EUR 49,632 k (EUR 39,069 k previous year) with real estate operating expenses of around 9.1 percent of revenues at EUR 4,530 k. Net rental income increased by EUR 8,030 k up to EUR 44,941 k compared to the first half of 2007.
Based on the revaluation of the investment portfolio as at June 30, 2008 we undertake a devaluation on the fair value of investment property of -EUR 29,816 k. This amount contains EUR 2,321 k negative adjustment of acquisition expenses relating to the first time inclusion of the Berlin, Darwinstraße and the Hamburg, Max-Brauer-Allee assets as well as the Blue portfolio. These acquisition expenses had been additionally capitalised within the valuation period and were therefore not considered in the devaluation provided by Colliers (-EUR 27,495 k).
Administrative and personnel expenses are at EUR 6,669 k for the six months (H1 2007 EUR 6,232 k). Total recurring operating expenses are at 13.4 percent of total revenues for the first half 2008 (H1 2007 16.0 percent). This improvement shows that the measures to enhance efficiency gains of overhead expenses, started to succeed.
Other operating income includes the reversal of accruals of EUR 1,100 and a one time separation payment of around EUR 1,000 k relating to the early termination of a rental agreement (BKK Mobil Oil; see page 8).
Significantly influenced by the valuation result alstria closed the first six month of 2008 with a net operating result of EUR 10,719 k compared to EUR 56,133 for the previous year reference period.
Hamburg, Blue-Portfolio
Portfolio Overview
Earnings Position
Financial and Asset Position > Risk and Opportunity Report
Recent Development and Outlook
| FUNDS FROM OPERATIONS | |||
|---|---|---|---|
| (in EUR k) | 1 Jan. -- 30 Jun. 2008 |
1 Jan. -- 30 Jun. 2007 |
Change |
| Pre-tax income (EBT) | -10,318 | 56,517 | -66,835 |
| less financial result | -22,983 | -18,021 | -4,962 |
| plus non-cash expenses | 549 | 0 | |
| EBITDA | 13,214 | 74,538 | -61,324 |
| less net loss/gain from fair value | -29,816 | 25,325 | -55,141 |
| adjustments on investment property less net loss/gain from fair value |
|||
| adjustments on financial derivatives | -381 | 18,405 | -18,787 |
| plus financial result | 1 -22,983 |
-18,021 | -4,962 |
| Funds from operations (FFO) | 20,430 | 12,787 | 7,643 |
1 Fair value loss disregarding realised fair value gains of EUR 2.328k
FFO is not a measure of operating performance or liquidity under generally accepted accounting principles, in particular IFRS, and should not be considered as an alternative to the Company's income or cash-flow measures as determined in accordance with IFRS. Furthermore, no standard definition exists for FFO. Thus, the FFO or measures with similar names as presented by other companies may not necessarily be comparable to the Company's FFO.EBITDA is not a measure of operating performance or liquidity under generally accepted accounting principles, in particular IFRS, and should not be considered as an alternative to the Company's income or cash-flow measures as determined in accordance with IFRS. Furthermore, no standard definition exists for EBITDA. Thus, EBITDA or measures with similar names as presented by other companies may not necessarily be comparable to the Company's EBITDA.
Portfolio Overview
Earnings Position
Financial and Asset Position > Risk and Opportunity Report
Recent Development and Outlook
Funds From Operations (FFO) were EUR 20,430 k for the reporting period. The strong increase as compared to H1 2007 resulted mainly from the improvement of net rental income to EUR 44,941 k, which is reflected by an increase of EUR 8,030 k compared to the first half 2007. As a result, FFO per share were at EUR 0.36 in the first six months of 2008 (H1 2007: EUR 0,23).
EBITDA were EUR 13,214 k in the first half 2008 as compared to EUR 74,538 k last year. The main reason for this significant difference are fair value adjustments that positively affected last years results and impact the reported result negatively. Namely a fair value gain of EUR 18,405 k on derivatives and a fair value gain of EUR 25,325 k on investment properties positively influenced last years EBITDA. In contrast, the fair value adjustments in the reporting period had a negative impact of – EUR 30,198 k (- EUR 29,816 k on investment properties and -EUR 381 k on derivatives). This year's operating performance was largely driven by top line growth.
In order to limit the P&L impact of the volatility of the interest rate markets, we have changed the accounting policy of our derivatives, and are now applying hedge accounting on all the hedges that qualify. This allows the full loss or gain on the qualifying derivative to be recognized through the cash flow hedge reserve (for more details please refer to the Notes to the Condensed Interim Consolidated Financial Statements as of March 31 and June 30, 2008). An overview of the composition of the fair values is given in the following table:
| HEDGING INSTRUMENTS | ||||
|---|---|---|---|---|
| (in EUR k) | Notional | 30 Jun. 08 | 31 Dec. 07 | Change |
| Swap - 3.6165% |
625,000 | 30,273 | 18,939 | 11,334 |
| Swap - 3.1925% |
148,785 | 5,902 | 0 | 5,902 |
| Swap - 3.1925% |
80,880 | 5,067 | 3,761 | 1,306 |
| Swap - 4.1160% |
100,000 | 3,766 | 0 | 3,766 |
| Cap - 4.9000%* |
75,000 | 1,625 | 1,126 | 499 |
| Swap - 4.9000% |
75,000 | 301 | 0 | 301 |
| Cap - 4.0000% |
** 80,880 |
0 | 1,811 | -1,811 |
| Cap - 3.8000% |
** 41,721 |
0 | 961 | -961 |
| Cap - 3.8000% |
** 26,185 |
0 | 604 | -604 |
| Total | 1,104,665 | 46,934 | 27,202 | 19,732 |
* As at December 31, 2007 EUR 150,000k notional amount
** Not recognized in total because notional as per December 2007; June 30, 2008: EUR 0
Portfolio Overview
Earnings Position
Financial and Asset Position > Risk and Opportunity Report
Recent Development and Outlook
The following table shows the changes of alstria's financial instruments by category:
| Effective Change of Fair Values Cash Flow Hedges | 27,202 |
|---|---|
| Ineffective Change of Fair Values Cash Flow Hedges | 19,893 |
| Fair Value Changes of Financial Instruments held for sale (Cap) | 0 |
| Changes of accrued interests concerning financial derivatives | 1,946 |
| Acquisitions | 221 |
| Disposals | 4,079 |
| -6,407 | |
| Hedging instruments as at 30 Jun. 2008 | 46,934 |
In the first six month of 2008 EUR 19,893 k represents the effective change in value of the swaps, which is recorded in equity as a "cash flow hedging reserve" account. While the fair value changes of derivatives not categorized as cash flow hedge (CAPs) are shown in the income statement under "Net gain/loss from fair value adjustments on financial derivatives", the ineffective impact of changes in fair value of the cash flow hedges and the interest payments and accruals on swaps and caps are stated in the financial result. Our current average hedge rate is of 3,8 percent with an average maturity of 3,7 years.
alstria has a EUR 1,139 million syndicated loan facility in
place that was arranged by J.P. Morgan, Natixis and HSH Nordbank. The utilization of this facility is presently at EUR 1,102.9 million (EUR 1,098.6 million taken into account the deduction according to IFRS effective interest rate method). The facility is used by alstria to partially finance the current investment property base. The interest rate on this syndicated loan is based on the three months EURIBOR floating rate plus a spread dependent on the average lease length of the property portfolio and the loan to value ratio. For economic as well as for G-REIT compliance reasons alstria is committed to maintain a G-REIT equity ratio of 45 percent or above. Following the recent acquisition, the current spread paid by alstria is 65 basis points above three month EURIBOR.
| FINANCIAL RESULT BREAKDOWN | ||
|---|---|---|
| (in EUR k) | 01 Jan. - 30 Jun. 2008 | 01 Jan. - 30 Jun. 2007 |
| Syndicated Loan - Interest and similar costs | -27,994 | -19,208 |
| Shareholder - Interests and similare costs | 0 | -1,182 |
| Interest income | 1 5,325 |
2,716 |
| Other | -314 | -347 |
| Total | -22,983 | -18,021 |
1 EUR 3,985k of the income are interest refunds for the derivatives; in H1 2007 -EUR 37k interest expenses for derivatives are shown under syndicated loan costs
Portfolio Overview
Earnings Position
Financial and Asset Position > Risk and Opportunity Report
Recent Development and Outlook
The resulting loss before tax is at -EUR 10,318 k for the first half 2008 (H1 2007 profit before tax of EUR 56,517 k). Consolidated net loss is at -EUR 10,392 k (H1 2007 net profit of EUR 44,108 k). The reason for the decrease of the consolidated net result compared to same period in 2007 resulted from a net loss from fair value adjustments in investment property of –EUR 29,816 k compared to a net gain in the first half of 2007 (EUR 25,325 k) and a significant decrease of the net gain on financial derivatives (EUR 1,946 k in H1 2008 against EUR 18,405 k H1 2007). Altogether these valuation effects account for -EUR 71,600 k difference.
Loss per share is -EUR 0.19 for the first six months.
| From January 1 to June 30, 2008 | 1 Jan. - 30 Jun. 2008 | 1 Jan. - 30 Jun. 2007 |
|---|---|---|
| (in EUR k) | ||
| Net rental income | 44,941 | 36,911 |
| Operational Expenses | -6,669 | -6,232 |
| Net other income | 2,264 | 129 |
| Net gain/loss from fair value adjustments on investment properties |
||
| -29,816 | 25,325 | |
| Net operating profit before finance costs |
10,719 | 56,133 |
| Net gain/loss from fair value adjustments on | ||
| financial derivatives | 1,946 | 18,405 |
| Financial result | -22,983 | -18,021 |
| Earnings before tax (EBT) | -10,318 | 56,517 |
| Income tax income/expense | -75 | -12,409 |
| Consolidated Loss/Profit for the | ||
| Period | -10,392 | 44,108 |
| EPS | -0.19 | 0.79 |
| EPS Diluted | -0.19 | 0.79 |
CONSOLIDATED INCOME STATEMENT
Portfolio Overview
Earnings Position
Financial and Asset Position
Risk and Opportunity Report > Recent Development and Outlook
Cash flow from operating activities for the six month period was at EUR 18,641 k. The strong improvement of alstria's operating performance reflected in the increase of the FFO (EUR 7,643 k) as compared to the previous year period was overcompensated by changes in working capital.
Cash flows from investing activities were impacted by the payments for the Bilfinger Berger portfolio (also referred to as "BLUE" portfolio; EUR 105,770 k), the HUK Coburg portfolio (EUR 50,262 k), as well as the purchase price payments for the acquisition of the properties in Berlin, Darwinstraße (EUR 52,350 k) and Hamburg, Max Brauer Allee (EUR 4.310 k).
Cash flow from financing activities reflects the payment of dividend (EUR 28,400 k) and the further EUR 171,453 k drawdown of the loan for the payments of the abovementioned investment properties.
As a result, alstria closes the first six months of 2008 with a cash position of EUR 33,362 k.
The total investment property value is at EUR 1,861,111 k as compared to EUR 1,693,718 k at the beginning of the year:
| Investment properties | |
|---|---|
| as at 31 Dec. 2007 | 1,693.72 |
| Acquisitions | 214.89 |
| Reclassification | -17.68 |
| Revaluations | -29.82 |
| Investment properties | |
| as at 30 Jun. 2008 | 1,861.11 |
One building (Bäckerbreitergang, Hamburg; EUR 3,10 million) is not longer stated as investment property but shown under development property.
Two investment properties (Düsternstrasse, Hamburg and Osterbekstrasse, Hamburg; EUR 14,58 milion) have been reclassified to investments held for sale in Q2 2008.
The equity and liability side of the balance sheet reflects a total equity position of EUR 844,537 k with an equity ratio of 42.8%. The G-REIT equity ratio which is defined as total equity divided by investment properties is at 45.4 percent in compliance with the G-REIT law requirements.
Hamburg, Blue-Portfolio
Portfolio Overview
Earnings Position > Financial and Asset Position
Risk and Opportunity Report
Recent Development and Outlook
The Triple Net Asset Value (NNNAV) droped from EUR 15.55 per share to EUR 15.08 per share. Dividend payments (-EUR 28.400 k), further acquisition of treasury shares (-EUR 7.868 k) and the consolidated loss for the period (-EUR 10.392 k) were responsible for the reduction of alstria's equity while the valuation gain of the effective derivatives (EUR 19.893 k) narrowed the gap. In total this lead to a decrease of equity from EUR 870.876 k to EUR 844.537 k1 .
The following table shows the key metrics of the NNNAV and NNNAV per share calculation according to EPRA2 :
| NNNAV PER SHARE | ||
|---|---|---|
| (in EUR k) | 30 Jun. 08 | 31 Dec. 07 |
| NAV | 844,537 | 870,875 |
| NAV/share | 15.08 | 15.55 |
| Effect of exercise of options, convertibles | ||
| and other equity interests | - | - |
| Diluted NAV, after the exercise of options, convertibles and other equity interests |
844,537 | 870,875 |
| Revaluation of investment properties | ||
| (if IAS 40 cost option is used) | - | - |
| Development properties held for investment | - | - |
| Revaluation of other non current investment | - | - |
| Fair value of tenant leases held as | ||
| finance leases | - | - |
| Fair value of trading properties | - | - |
| Fair Value of Financial Instruments | -46,934 | -27,202 |
| Diluted EPRA NAV | 797,604 | 843,673 |
| Diluted EPRA NAV/share | 14.24 | 15.07 |
| Fair Value of Financial Instruments | 46,934 | 27,202 |
| Fair Value of Debt | - | - |
| Deffered Tax | - | - |
| Diluted EPRA NNNAV | 844,537 | 870,875 |
| NNNAV/share | 15.08 | 15.55 |
The long term loan position is at EUR 1,098,575 k up from EUR 927,400 k. The main changes in the long term loan position over the last six months resulted from the refinancing of the new acquisitions.
Current liabilities are at EUR 28,440 k which is mainly related to accrued interest that will become due under the syndicated loan agreement within one year, trade payables and other accruals.
1 See also the statement of shareholders' equity in the consolidated financial statements section, page 21. 2 EPRA: European Public Real Estate Association, Best Practises Committee, Schiphol Airport, The Netherlands.
Portfolio Overview
Earnings Position
Financial and Asset Position > Risk and Opportunity Report
Recent Development and Outlook
The risks and opportunities alstria is exposed to are described in detail in the annual report 2007. The risk reporting structure within the alstria group was updated for the preparation of this interim report. There have been no significant changes in the alstria group's risks and opportunities situation compared with the risks and opportunities outlined in the management report of the 2007 annual report. It is therefore assumed the reported risks and opportunities will remain substantially unchanged in the second half of 2008.
On the basis of all known particulars and circumstances, there moreover exist no risks that can endanger the alstria group's survival for the foreseeable future.
alstria has acquired another vacant office property based in Hamburg with a total lettable area of approximately 3,100 sqm. The all in costs of approximately EUR 4.6 million (approximately EUR 1,485 per sqm) have been funded through the company's cash flow. The acquisition was completed in the course of the second quarter 2008.
We realized a principle agreement with the Ohnsorg Theatre to move sites within our portfolio. This agreement gives us the opportunity to develop 3.000 sqm of highend retail space in one of Hamburg´s most sought after shopping streets at Grosse Bleichen.
It is our intent to restructure the current credit facility well before its expiry in November 2011 with the objective to increase capacity and flexibility and also to have a more structured maturity of the new facility. In order to open the field for more capital market orientated debt financing we would also need to move from a secured to an unsecured debt structure. In a first step towards the new financing structure we agreed a new EUR 95 millions, 7 years, non recourse loan on the properties Gänsemarkt 36 and Drehbahn 36, Hamburg, with Deutsche Hypothekenbank (Actien-Gesellschaft). Under the new agreement the leverage on these assets will increase from currently EUR 78.5 m to EUR 95 m, keeping the net debt of the company constant. Accordingly, the transaction will provide us with EUR 16.5 m of additional cash. Given the level of volatility in the markets we intend to keep the funds on the balance sheet for the time being, so we can react rapidly to changes/opportunities in the market. Once we have greater clarity of where the markets are moving we will preferably re-invest the funds.
In view of the positive operational development in the first six month alstria is able to look to the second half of the 2008 financial year with confidence. Our operational efficiency gains correspond with the employment of skilled experts in order to improve processes and with the insourcing of the financial accounting activities decrease administration costs. The higher than expected growth of the German CPI has a positive income effect and triggered the CPI adjustment clauses on around 35% of our leases allowing alstria to additionally generate approximately EUR 1.7 million of annualized revenues from the second quarter of 2008 on. Based on the fact that the closing of the recent acquisitions are in line with our adjusted schedule, the management of alstria reinforces its revenues expectations of around EUR 101 m. The corresponded FFO expectation remains at EUR 40 m for the year 2008.
The management report contains statements relating to anticipated future developments. These statements are based on current assessments and are by their very nature exposed to risks and uncertainty. Actual developments may differ from those predicted in these statements.
Consolidated Income Statement > Consolidated Statement of Change in Equity
Consolidated Cash Flow Statement
| Notes 6.1 6.2 3; 6.3 |
30 Jun. 2008 1,861,111 3,109 1,347 366 45,309 1,911,243 14,575 |
31 Dec. 2007 1,693,718 0 1,494 359 0 1,695,571 0 |
|---|---|---|
| 5,120 | 2,646 | |
| 6.4 | 27 | 77 |
| 1,624 | 27,202 | |
| 1,949 | ||
| 5,039 | ||
| 103,036 | ||
| 60,366 | 139,949 | |
| 1,971,609 | 1,835,520 | |
| 1,949 3,708 33,362 |
Consolidated Income Statement
Consolidated Statement of Change in Equity > Consolidated Cash Flow Statement
| Equity and liabilities | Notes | 30 Jun. 2008 | 31 Dec. 2007 |
|---|---|---|---|
| (in EUR k) | |||
| Equity | |||
| Share capital | 7.1 | 56,000 | 56,000 |
| Capital surplus | 7.1 | 755,075 | 754,647 |
| Hedging reserve | 3; 7.1 | 19,893 | 0 |
| Treasury shares | 7.1 | -14,983 | -7,115 |
| Retained earnings | 7.1 | 28,552 | 67,344 |
| Total equity | 844,537 | 870,876 | |
| Liabilities | |||
| Long-term loans, net of current portion | 7.2 | 1.098,576 | 927,400 |
| Other non-current liabilities | 56 | 56 927,456 |
|
| Total non-current liabilities | 1,098,631 | ||
| Current liabilities | |||
| Short-term loans | 11,798 | 8,936 | |
| Trade payables | 5,681 | 3,068 | |
| Payables to affiliates | 5 | 15 | |
| Profit participation rights | 48 | 5 | |
| Liabilities of current tax | 21 | 5,332 | |
| Other current liabilities | 10,033 | 19,832 | |
| VAT liabilities | 856 | 0 | |
| Total current liabilities | 28,440 | 37,188 | |
| Total liabilities | 1,127,072 | 964,644 | |
| Total equity and liabilities | 1,971,609 | 1,835,520 | |
Consolidated Income Statement > Consolidated Statement of Change in Equity
Consolidated Cash Flow Statement
| 01. 04. - | 1. 04. - | 01. 01. - | 01. 01. - | ||
|---|---|---|---|---|---|
| (in EUR k) | Notes | 30. 06. 2008 | 30. 06. 2007 | 30. 06. 2008 | 30. 6. 2007 |
| Gross rental income | 26,084 | 21,720 | 49,632 | 39,069 | |
| Income less expenses from | |||||
| passed on expenses | -5 | 0 | -162 | 0 | |
| Real estate operating expenses | -3,494 | -1,370 | -4,530 | -2,158 | |
| Net rental income | 22,585 | 20,350 | 44,941 | 36,911 | |
| Administrative expenses | 8.1 | -1,738 | -2,903 | -4,042 | -4,808 |
| Personnel expenses | -1,474 | -733 | -2,627 | -1,424 | |
| Other income | 915 | -142 | 2,468 | 192 | |
| Other expenses | 75 | -14 | -204 | -63 | |
| Net loss/gain from | |||||
| fair value adjustments on investment property | -29,249 | 21,833 | -29,816 | 25,325 | |
| Net operating profit | |||||
| before finance costs | -8,887 | 38,391 | 10,719 | 56,133 | |
| Net financing costs | -11,383 | -6,769 | -22,983 | -18,021 | |
| Net gain from fair value | |||||
| adjustments on financial | |||||
| derivatives | 3.628 | 16,343 | 1,946 | 18,405 | |
| Profit before tax (EBT) | -16,642 | 47,965 | -10,318 | 56,517 | |
| Income tax income/expense | 0 | -10,198 | -75 | -12,409 | |
| Consolidated profit/loss for the period | -16,642 | 37,767 | -10,392 | 44,108 | |
| Attributable to: Shareholder | -16,642 | 37,767 | -10,392 | 44,108 | |
| Earnings/loss per share in EUR: | |||||
| basic, for profit for the year attributable | |||||
| to ordinary equity holders of the parent | -0.19 | 0.79 | |||
| diluted, for profit for the year attributable | |||||
| to ordinary equity holders of the parent | -0.19 | 0.79 |
Balance Sheet > Consolidated Income Statement
Consolidated Statement of Change in Equity
Consolidated Cash Flow Statement
| (in EUR k) | Notes | Share capital |
Capital surplus |
Hedging reserve |
Treasury shares |
Retained earnings |
Total Equity |
|---|---|---|---|---|---|---|---|
| As of January 1, 2008 | 56,000 | 754,647 | 0 | -7,115 | 67,344 | 870,876 | |
| Changes in first half 2008 |
|||||||
| Consolidated profit for the | |||||||
| year | - | - | - | -10,392 | -10,392 | ||
| Payment of dividends | 9 | - | - | - | - | -28,400 | -28,400 |
| Valuation financial | - | ||||||
| derivatives | 3; 6.3; 7.1 | - | - | - | - | 19,893 | |
| Share-based payments | 7.1 | - | 436 | 19,893 | - | - | 436 |
| Changes of treasury shares | - | - | - | -7,868 | - | -7,868 | |
| Other Contributions to | 7.1 | - | |||||
| capital surplus | - | -8 | - | - | - | -8 | |
| As of June 30, 2008 | 56,000 | 755,075 | 19,893 | -14,983 | 28,552 | 844,537 | |
Balance Sheet > Consolidated Income Statement
Consolidated Statement of Change in Equity
Consolidated Cash Flow Statement
| (in EUR k) | Notes | Share capital |
Capital surplus |
Hedging reserve |
Treasury shares |
Retained earnings |
Total Equity |
|---|---|---|---|---|---|---|---|
| As of January 1, 2007 |
8,000 | 375,066 | 0 | 0 | 14,533 | 397,599 | |
| Changes in first half 2007 |
|||||||
| Consolidated profit for the | |||||||
| year Changes in the |
- | - | - | - | 44,108 | 44,108 | |
| consolidated group | - | -479 | - | - | - | -479 | |
| Valuation shareholder | |||||||
| loan | - | 646 | - | - | - | 646 | |
| Share-based payments | - | 335 | - | - | - | 335 | |
| Contributions to share | |||||||
| capital | 48,000 | - | - | - | - | 48,000 | |
| Contributions to capital | |||||||
| surplus (IPO) | - | 240,000 | - | - | - | 240,000 | |
| Expenses in connection | |||||||
| witht IPO | - | -11,108 | - | - | - | -11,108 | |
| Other Contributions to | |||||||
| capital surplus | - | 154,665 | - | - | - | 154,665 | |
| As of June 30, | |||||||
| 2007 | 56,000 | 9,125 | 0 | 0 | 58,641 | 873,766 |
Balance Sheet
Consolidated Income Statement
Consolidated Statement of Change in Equity > Consolidated Cash Flow Statement
| CONSOLIDATED CASH FLOW STATEMENT JANUARY 1 TO JUNE 30, 2008 | |||
|---|---|---|---|
| Notes | 1 Jan. - | 1 Jan. - | |
| (in EUR k) | 30 Jun. 2008 | 30 Jun. 2007 | |
| 1. Operating activities | |||
| Consolidated profit for the year | -10,392 | 44,108 | |
| Unrealized valuation movements | 27,870 | -43,730 | |
| Interest income | -5,325 | -3,673 | |
| Interest expense | 27,773 | 20,712 | |
| Result from income taxes | 74 | 12,408 | |
| Other non-cash income (-)/expenses (+) | |||
| and IPO-costs | 429 | 0 | |
| Depreciation and amortisation | 254 | 57 | |
| Movement in receivables | 344 | -2,857 | |
| Movement in payables and provisions | 1,967 | 3,468 | |
| Cash generated from operations | 42,994 | 30,493 | |
| Interest received | 5,325 | 3,069 | |
| Interest paid | -24,614 | -12,967 | |
| Income taxes paid | -5,064 | -861 | |
| Cash flows from operating activities | 18,641 | 19,734 | |
| 2. Investing activities | |||
| Acquisition of investment properties | -222,921 | -31,481 | |
| Acquisition of other property plant and equipment | -115 | -45 | |
| Acquisition of subsidiaries | -464 | -14,794 | |
| Cash flows used in investing activities | -223,500 | -46,320 | |
Consolidated Income Statement
Consolidated Statement of Change in Equity
Consolidated Cash Flow Statement
| Notes | 01 Jan. - | 01 Jan. - | |
|---|---|---|---|
| (in EUR k) | 30 Jun. 2008 | 30 Jun. 2007 | |
| 3. Financing activities | |||
| Proceeds from equity contributions | 0 | 304,983 | |
| Repurchase of own shares | 7.1 | -7,868 | 0 |
| Proceeds from the issue of bonds and borrowings | 171,453 | 163,327 | |
| Payment of dividends | 7.1 | -28,400 | 0 |
| Payment for the redemption of bonds and | |||
| borrowings | 0 | -161,820 | |
| Payment of transaction costs | 0 | -355 | |
| Payment of IPO costs | 0 | -11,261 | |
| Cash flows used in financing activities | 135,185 | 294,874 | |
| 4. Cash and cash equivalents at the end of the period | |||
| Change in cash and cash equivalents (subtotal of 1 to 3) | -69,674 | 121,438 | |
| Cash and cash equivalents at the beginning of the period | 103,036 | 242,876 | |
| Cash and cash equivalents at the end of the period | 33,362 | 292,592 | |
| 5. Composition of cash and cash equivalents | |||
| Cash | 33,362 | 292,592 | |
| Securities | 0 | 0 | |
| Cash and cash equivalents at the end of the period | 33,362 | 292,592 | |
1 Fair value loss disregarding realised fair value gains of EUR 2.328k
FFO is not a measure of operating performance or liquidity under generally accepted accounting principles, in particular IFRS, and should not be considered as an alternative to the Company's income or cash-flow measures as determined in accordance with IFRS. Furthermore, no standard definition exists for FFO. Thus, the FFO or measures with similar names as presented by other companies may not necessarily be comparable to the Company's FFO.EBITDA is not a measure of operating performance or liquidity under generally accepted accounting principles, in particular IFRS, and should not be considered as an alternative to the Company's income or cash-flow measures as determined in accordance with IFRS. Furthermore, no standard definition exists for EBITDA. Thus, EBITDA or measures with similar names as presented by other companies may not necessarily be comparable to the Company's EBITDA.
alstria office REIT-AG, Hamburg, (hereinafter referred to as the "Company" or "alstria office REIT-AG" and together with its subsidiaries the "Group"), is a German stock corporation based in Hamburg. The Group's principal activities are described in detail in section 1 of the notes to the consolidated financial statements for the fiscal year ended December 31, 2007.
The Condensed Interim Consolidated Financial Statements for the period from January 1, 2008 to June 30, 2008 (hereinafter referred to as the "Condensed Interim Consolidated Financial Statements") were authorized for issue by resolution of the Company's management board on August 15, 2008.
These Condensed Interim Consolidated Financial Statements have been prepared in accordance with IAS 34 "Interim Financial Reporting". They do not contain all the disclosures and explanations required in annual financial statements and should therefore be read in conjunction with the consolidated financial statements as of December 31, 2007.
These Condensed Interim Consolidated Financial Statements have not been audited. They have been reviewed by PricewaterhouseCoopers AG Wirtschaftsprüfungsgesellschaft, Berlin branch.
The accounting policies adopted in the preparation of the Condensed Interim Consolidated Financial Statements are consistent with those followed in the preparation of the Group's annual financial statements for the fiscal year ended December 31, 2007, except for the adoption of hedge accounting as explained below. Derivative financial instruments and hedging.
The Group uses derivative financial instruments such as interest rate swaps and caps to hedge its risks associated with interest rate fluctuations. Such derivative financial instruments are initially recognised at fair value on the date on which a derivative contract is entered into and are subsequently remeasured at fair value. Derivatives are carried as assets when the fair value is positive and as liabilities when the fair value is negative.
Any gains or losses arising from changes in fair value on derivatives during the period that do not qualify for hedge accounting are taken directly to profit or loss. For the purpose of hedge accounting, hedges are classified as cash flow hedges when hedging exposure to variability in cash flows is attributable to a particular risk associated with a recognised liability.
At the inception of a hedge relationship, the Group formally designates and documents the hedge relationship to which the Group wishes to apply hedge accounting and the risk management objective and strategy for undertaking the hedge. The documentation includes identification of the hedging instrument, the hedged item, the nature of the risk being hedged and how the entity will assess the hedging instrument's effectiveness in offsetting the exposure to changes in the hedged item's cash flows attributable to the hedged risk. Such hedges are expected to be highly effective in achieving offsetting changes in fair value or cash flows and are assessed on an ongoing basis to determine that they actually have been highly effective throughout the financial reporting periods for which they were designated.
Cash flow hedges which meet the strict criteria for hedge accounting are accounted for as follows:
The effective portion of the gain or loss on the hedging instrument is recognised directly in equity, while any ineffective portion is recognised immediately in profit or loss.
Amounts taken to equity are transferred to profit or loss
when the hedged transaction affects profit or loss, such as when the hedged financial income or financial expense is realized.
There have been no changes to the consolidated group since the consolidated financial statements as of December 31, 2007.
The preparation of the consolidated financial statements in accordance with IFRS requires assumptions and estimates to be made for various items which have an effect on the amount and disclosure of the assets and liabilities as well as income and expenses. Actual amounts may differ from these estimates.
alstria office REIT-AG uses the fair value model pursuant to IAS 40.33 et seq. for subsequent measurement. External appraisals were obtained for measurement dated June 30, 2008. For a detailed description of the valuation process we refer to section 8 of the consolidated financial statements as of December 31, 2007.
On August 22, 2007, alstria office REIT-AG concluded a purchase agreement on the acquisition of further property with a purchase price value of EUR 52,350k, with the property being transferred to alstria office REIT-AG with effect of March 3, 2008 (property Darwinstrasse).
On December 12, 2007, alstria office REIT-AG concluded a purchase agreement on the acquisition of further properties with a purchase price value of EUR 105,770k, with the properties being transferred to alstria office REIT-AG with effect of March 3, 2008 (EUR 104,520k) and May 2, 2008 (EUR 1,250k) (BLUE portfolio).
On December 17, 2007, alstria office REIT-AG concluded a purchase agreement on the acquisition of further properties with a purchase price value of EUR 50,262k. The transfer of possession, benefits and burdens took place on April 1, 2008 (Helios portfolio).
Under the purchase agreement dated April 4, 2008, alstria office REIT-AG concluded the acquisition of one further property located in Hamburg with a purchase price value of EUR 4,310k. The property has been transferred to alstria office REIT-AG with effect of June 1, 2008.
Under the sales agreement dated June 27, 2008, alstria office REIT-AG concluded the sale of a plot of land at Vahrenwalder Str. 133, Hanover, with a total sales price value of EUR 1,250k. The transfer of possession, benefits and burdens is expected to take place in Q4 2008.
Due to a sales process, two investment properties have been reclassified to investments held for sale in Q2. These two properties are Düsternstrasse 10, Hamburg and Osterbekstrasse 96, Hamburg with a fair value of EUR 14,575k.
alstria office REIT-AG intends to use one of its office buildings in Hamburg for owner occupation use. For this purpose, the property will be refurbished. Therefore the property was re-categorised from investment property according to IAS 40 to development property according to IAS 16.
In the second quarter 2008 alstria office REIT-AG used the market opportunities to restructure its hedging portfolio while keeping the same protection level. With value date April 21, 2008 alstria office REIT-AG entered with Natixis into an off-market interest rate swap with a notional amount of EUR 148,785k at a swap rate of 3.9087%, expiring on January 20, 2012. This swap replaced existing interest rate caps for the same combined notional amount and interest rate with maturity in March and November 2011.
On June 11, 2008 alstria office REIT-AG entered with HSH Nordbank AG into an off-market interest swap with a notional amount of EUR 75,000k at a swap rate of 4.9000%, expiring on December 20, 2012. This swap partly replaces the existing interest rate cap amounting to EUR 150,000k with the same maturity. This transaction is effective as per July 21, 2008.
Due to the specific nature of the business, the Group considers receivables due up to one year to be current. All receivables as per balance sheet date are due within the next twelve months.
Please refer to the Consolidated Statement of Changes in Equity.
In the balance sheet of the Consolidated Interim Financial Statements as of June 30, 2008, the share capital of alstria office REIT-AG amounted to EUR 56,000k. Captiva 2 Alstria Holding S.à.r.l., Luxembourg, held, directly and indirectly, 54.0% of the shares in the Company, 43.5% of the shares are free float and the remaining 2.5% are treasury shares.
In the first six month of 2008 the Company completed its share buyback programme. For a detailed description of the share buyback programme, please see section 11 of the consolidated financial statements as of December 31, 2007. With resolution of the supervisory board, dated June 5, 2008, the management board members were granted the possibility to receive a part of their resolved bonus payments for the financial year 2007 in the form of alstria' shares. Based on this resolution the members of the management board decided to receive in total 9.500 shares as bonus compensation payment. At granting date these shares valued at a closing price of EUR 11.03 each. The 9.500 shares have been charged against the bonus entitlements out of the existing treasury shares. On June 30, 2008 the Company held 1,375,755 non-par value bearer shares of EUR 1 each.
A stock option program was resolved on March 27, 2007 by the supervisory board of the Company and accordingly stock options with a total fair value of EUR 1,997k were issued to members of the management board of the Company on April 3, 2007 and September 5, 2007. Thereof stock options with a fair value of EUR 446k were forfeited as of December 31, 2007 in relation with the retirement of Dr. Michael Börner-Kleindienst. As of June 30, 2008, further EUR 415k (December 31, 2007: EUR 806k), from the allocation of the fair values of the granted stock options over the respective vesting period, have been added to the capital surplus.
A convertible profit participation rights program was resolved on September 5, 2007 by the supervisory board of the Company and profit participation rights certificates with a fair value according to IFRS 2 of EUR 35K were issued to employees of the Company on September 6, 2007. As of June 30, 2008, the issue of the certificates resulted in a further increase of the capital surplus of EUR 8k (December 31, 2007: EUR 6k) from the allocation of the fair values of the profit participation rights over the respective vesting period.
Further 42.000 profit participation rights certificates with a fair value according to IFRS 2 of EUR 331K were issued to employees of the Company on June 6, 2008. As of June 30, 2008, the issue of the certificates resulted in a further increase of the capital surplus of EUR 13k from the allocation of the fair values of the profit participation rights over the respective vesting period.
| OTHER RESERVES | ||
|---|---|---|
| June 30, 2008 |
Dec. 31, 2007 |
|
| (in EUR k) | (unaudited) | (audited) |
| As of January 1 | 0 | 0 |
| Net movement on | ||
| cash flow hedges | 19,893 | 0 |
| As of June 30 / | ||
| December 31 | 19,893 | 0 |
This reserve records the portion of the gain or loss on hedging instruments in cash flow hedge that are determined to be an effective hedge.
As of June 30, 2008, the loans used by alstria office REIT-AG are repayable with EUR 1,102,869k (December 31, 2007: EUR 931,416k). The carrying amount takes into account interest liabilities and transaction costs to be allocated under the effective interest method upon raising the liabilities.
In the first six months of 2008 alstria office REIT-AG drew down new loans with a nominal amount of EUR 171,453k in conjunction with financing new investment properties. The loans are part of the syndicated loan agreement with J.P. Morgan Plc., Natixis, German Branch, and HSH Nordbank AG with a nominal amount of EUR 1,139,800k.
For a detailed description of the syndicated loan agreement, loan terms and grant securization, please see section 11.2 of the consolidated financial statements as of December 31, 2007.
The personnel expenses shown in the profit and loss account in the amount of EUR 2,627k (June 30, 2007: EUR 1,424k (stated in administration expenses)) include bonuses in the amount of EUR 452k (June 30, 2007: EUR 370k). Furthermore, personnel expenses of EUR 415k (June 30, 2007: EUR 335k) relating to stock options granted to the management are included as well as EUR 29k (June 30, 2007: EUR 0k) personnel expenses relating to profit participation rights certificates granted to employees.
In consequence of the transformation into a G-REIT, alstria office REIT-AG is exempted from income taxes.
For a detailed description of the transformation and tax related implications, please see section 12.9 of the consolidated financial statements as of December 31, 2007.
The General Meeting of alstria office REIT-AG on June 5, 2008 resolved to distribute a dividend of EUR 28,400k (EUR 0.52 per share outstanding). The dividend was distributed on June 6, 2008.
During the period from January 1, 2008 to June 30, 2008, on an average twenty-five people (January 1, 2007 to June 30, 2007: on an average ten people) were employed by the Company. The average was calculated by the sixth part of the total of employed people at the end of each month. On June 30, 2008, twenty-eight people (December 31, 2007: twenty people) were employed at alstria office REIT-AG, excluding the management board.
In line with the convertible profit participation rights program the supervisory board resolved on September 5, 2007, with granting date June 6, 2008, 42.000 convertible profit participation certificates ("certificates") had been issued to the employees of alstria office REIT-AG. The nominal amount of each certificate is EUR 1.00 and was payable on issuance. The fair values of the inherent options for conversion are estimated using a binary barrier option model based on the black-scholesassumptions. The model takes into account the terms and conditions upon which the instruments were granted. For a detailed description of the convertible profit participation rights program, please see section 18 of the consolidated financial statements as of December 31, 2007.
The following table lists the inputs to the model used for the determination of the options for conversion granted on June 6, 2008:
| Dividend yield (%) | 4.70 |
|---|---|
| Risk-free interest rate (%) | 4.65 |
| Expected volatility (%) | 35.00 |
| Expected life option (years) | 2.00 |
| Exercise share price (EUR) | 2.00 |
| Labour turnover rate (%) | 10.00 |
| Stock price as of valuation date (EUR) | 11.03 |
The estimated fair value of one option for conversion at the granting date was EUR 8.76.
Under the sales agreement dated July 31, 2008, alstria office REIT-AG concluded the sale of property Osterbekstrasse 96, Hamburg, with a total sales price value of EUR 11,000k. The transfer of possession, benefits and burdens is expected to take place in Q4 2008.
Under the sales agreement dated August 1, 2008, alstria office REIT-AG concluded the sale of property Düsternstrasse 10, Hamburg, with a total sales price value of EUR 4,950k. The transfer of possession, benefits and burdens is expected to take place in Q4 2008.
The newly founded subsidiary alstria Gänsemarkt Drehbahn GmbH & Co. KG entered into a facility agreement of a EUR 95 millions, 7 years, non recourse loan on the properties Gänsemarkt 36 and Drehbahn 36, Hamburg, with Deutsche Hypothekenbank (Actien-Gesellschaft). The loan amount is expected to be paid to alstria office REIT-AG, who will repay the allocated loan amount of these assets under the current facility agreement. In return the possession, benefits and burdens will be transferred to the debtor. The transaction is expected to close on 20 October 2008.
As of June 30, 2008, the members of the Company's management board are: Mr. Olivier Elamine (CEO) Mr. Alexander Dexne (CFO)
Pursuant to the Company's articles of association (Section 9), the supervisory board consists of six members, which are elected by the general meeting of shareholders. The expiration of the term of office is identical for all members, i.e., the close of the annual general meeting of shareholders in the year 2011.
As of June 30, 2008, the members of the supervisory board are:
We assure that, to the best of our knowledge and based on the accounting standards to be applied for interim financial reporting, the shortened Consolidated Interim Report provides a true and fair view of the net worth, financial position and financial performance of the Group and that the Group Interim Management Report presents business progress including the business results and the position of the Group in such a way that it provides a true and fair view, as well as describing the principal opportunities and risks of the Group's anticipated development in the remainder of the financial year.
Hamburg, Germany, August 15, 2008
Olivier Elamine Alexander Dexne Chief Executive Officer Chief Financial Officer
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Dear Sirs
We refer to your instructions to provide you with our opinion of the Market Value of the above portfolio, as at 30 June 2008, for balance sheet purposes, debt covenant calculation and inclusion within your mid year accounts.
We have pleasure in presenting our report.
The properties have been inspected and valued by suitably qualified surveyors who fall within the requirements as to competence as set out in PS 1.4 and 1.5 of the Valuation Standards (the 'Red Book') issued by the Royal Institution of Chartered Surveyors (the 'RICS').
We confirm that Colliers CRE complies with the requirements of independence and objectivity under PS 1.6 and that we have no conflict of interest in acting on your behalf in this matter.
The properties were all inspected at various times between June 2006 and December 2007 by either Christopher J Fowler-Tutt, BSc MRICS, Robert Mayhew BSc (Hons) MRICS, Nick Harris BSc (Hons) MRICS, Charlie Henry BSc (Hons) MRICS, Adrian Camp BSc (Hons) MRICS or Giles Bendell BSc MRICS.
The extent of our investigations and the sources of information on which we have relied upon are as described in Section 4 – Valuation Procedures and Assumptions contained within the Red Book.
We confirm that our valuation complies with the requirements of IAS 40 – Investment Property. Where an entity opts to account for investment property using the fair value model, IVSC considers that the requirements of this model are met by the valuer adopting Market Value.
Our General Assumptions and Definitions form Appendix I to this report.
The portfolio comprises 90 office investment properties located throughout Germany. The regional location profile of the portfolio across Germany's states is illustrated below, where it can be seen that the largest concentration of investment property in terms of value, 49.76%, is held in the City of Hamburg. The portfolio also comprises properties in the cities of Augsburg, Berlin, Bonn, Darmstadt, Detmold, Dortmund, Dresden, Dusseldorf, Erfurt, Essen, Frankfurt, Halle, Hannover, Jena, Koln, Leipzig, Magdeburg, Mannheim, Munich, Nurnberg, Potsdam, Stuttgart, Wiesbaden, Wuppertal, Wurzburg and Zwickau.
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In accordance with your instructions we have not measured the subject premises and have relied upon the floor areas adopted at the time the properties were purchased.
We have been provided with the following reports, which we have had regard to in arriving at our opinions of value.
| Due Diligence Report | Dated 12 December 2005 |
|---|---|
| Draft Due Diligence Report | Dated 26 September 2006 |
| Summary of Major Findings | Dated 27 September 2005 |
| Legal Due Diligence Report | Dated 26 September 2006 |
| Legal Due Diligence Report | Dated 24 October 2006 |
| Legal Due Diligence Report | Dated 16 July 2007 |
| Legal Due Diligence Report | Dated 31 October 2007 |
| Draft Preliminary Key Issues | |
| Report for Legal Due Diligence | Dated 14 November 2007 |
| Red Flag List of Legal Due | |
| Diligence | Dated 14 December 2007 |
All of the above reports were prepared by your lawyers Messrs. Alpers & Stenger, Freshfields Bruckhaus Deringer and Lovells. Our valuations assume that, with the exception of the matters disclosed within the aforementioned reports, there are no unusual, onerous or restrictive covenants in the titles which are likely to affect the value.
We have relied upon the letting details contained within the following reports prepared by your lawyers Messrs. Alpers & Stenger, Freshfields Bruckhaus Deringer and Lovells.
| Due Diligence Report | Dated 12 December 2005 |
|---|---|
| Draft Due Diligence Report | Dated 26 September 2006 |
| Summary of Major Findings | Dated 27 September 2005 |
| Legal Due Diligence Report | Dated 26 September 2006 |
| Legal Due Diligence Report | Dated 24 October 2006 |
| Legal Due Diligence Report | Dated 16 July 2007 |
| Legal Due Diligence Report | Dated 31 October 2007 |
| Draft Preliminary Key Issues | |
| Report for Legal Due Diligence | Dated 14 November 2007 |
| Red Flag List of Legal | |
| Due Diligence | Dated 14 December 2007 |
We have been provided with a tenancy schedule dated 30 June 2008 by alstria office REIT-AG to which we have had regard in arriving at our opinions of value. We have compared the new rent roll with the one provided to us on the 31 December 2007 and have enquired about any changes.
We have assumed all information provided to be accurate, up-to-date and complete.
We have not carried out building surveys of the properties and neither have we tested the drainage or service installations in the buildings as this was outside the scope of our instructions. If there is significant capital expenditure required on a property this sum will have been deducted from the value reported.
We have been provided with the following reports prepared on your behalf by URS Deutschland GmbH (URS):
| Report | Dated 19 December 2005 |
|---|---|
| Technical and Environmental | |
| Due Diligence Assessment | Dated 25 August 2006 |
| Intermediate Environmental | |
| Bullet Point Report | Dated 9 October 2006 |
| Technical Due Diligence | |
| Report | Dated 29 December 2006 |
| Technical and Environmental | |
| Due Diligence Assessment | |
| Revised Final Report | Dated 7 November 2007 |
| Technical and Environmental | |
| Due Diligence Assessment | Dated 13 November 2007 |
| Technical and Environmental | |
| Due Diligence Assessment | |
| Reports | Dated 21 December 2007 |
| Technical and Environmental | |
| Due Diligence Assessments | Dated 22 December 2007 |
Valuation Report > Portfolio Overview > Review Report > Financial Calendar > Contact
We have been provided with the following reports, prepared on your behalf by URS Deutschland GmbH (URS), which we have relied upon in arriving at our opinions of value.
| Report | Dated 19 December 2005 |
|---|---|
| Technical and Environmental | |
| Due Diligence Assessment | Dated 25 August 2006 |
| Intermediate Environmental | |
| Bullet Point Report | Dated 9 October 2006 |
| Technical Due Diligence | |
| Report | Dated 29 December 2006 |
| Technical and Environmental | |
| Due Diligence Assessment | |
| Revised Final Report | Dated 7 November 2007 |
| Technical and Environmental | |
| Due Diligence Assessment | Dated 13 November 2007 |
| Technical and Environmental | |
| Due Diligence Assessment | |
| Reports | Dated 21 December 2007 |
| Technical and Environmental | |
| Due Diligence Assessments | Dated 22 December 2007 |
We have not made any formal searches or enquiries in respect of the properties and are, therefore, unable to accept any responsibility in this connection. We have, however, relied upon the following reports:
| Report | Dated 19 December 2005 |
|---|---|
| Technical and Environmental | |
| Due Diligence Assessment | Dated 25 August 2006 |
| Intermediate Environmental | |
| Bullet Point Report | Dated 9 October 2006 |
| Technical Due Diligence | |
| Report | Dated 29 December 2006 |
| Technical and Environmental | |
| Due Diligence Assessment | |
| Revised Final Report | Dated 7 November 2007 |
| Technical and Environmental | |
| Due Diligence Assessment | Dated 13 November 2007 |
| Technical and Environmental | |
| Due Diligence Assessment | |
| Reports | Dated 21 December 2007 |
| Technical and Environmental | |
| Due Diligence Assessments | Dated 22 December 2007 |
All of the above were prepared by your lawyers Messrs. Alpers & Stenger, Freshfields Bruckhaus Deringer and Lovells for formal search information, town planning and permit issues and we have had regard to this information in arriving at our opinions of value.
In preparing our valuations we have taken into account market trends in the locality and except where you have advised us to the contrary, or our other enquiries have alerted us to this, we have assumed that there have been no material changes to any of the properties or their surroundings that might have a material effect on value, since the time of our inspection.
In arriving at our opinions of value we have had regard to comparable investment transactions in determining the net initial yield and equivalent yield which we have adopted in capitalising the current income stream. Where properties have less than 5 years of term certain left we have adopted income void periods which range from 18 to 24 months depending upon the type of property prior to reletting. For properties with a large car parking provision we have adopted a structural void ranging from 5 to 20%, depending on the vacancy rate at the date of valuation. In the case of properties with small car parking provisions we have adopted a void period of 3 months. In addition, where appropriate, we have allowed for capital expenditure either to undertake works necessary to relet properties at the end of the lease or deal with extra ordinary items of disrepair that are the responsibility of the lessor.
We are of the opinion that this portfolio as a whole or each of its individual assets would appeal to a wide range of purchasers including funds, property companies and institutions. It would also be of interest to overseas investors attracted by the high quality income stream secured over long unexpired lease terms. We consider that demand for the portfolio would be strong.
In arriving at our opinion of the value we have made a total deduction of 5% from the income receivable to allow for non-recoverable costs. Such costs relate to items which cannot be recovered from the tenant and generally includes the expense of maintaining and repairing all structural components of the property and associated access roads, as well as being financially
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responsible for maintenance and repair items and management expenses etc. However, it does not include tenant improvement measures that have been taken into consideration. Moreover, when the technical due diligence reports showed that additional Capital Expenditure was required, we have deducted all, or part of those additional costs from our valuation.
In preparing our valuation we have made an analysis of the Market Rent of the portfolio and compared it to the passing rent. Any difference between the Market Rent and the passing rent has been taken into consideration in our valuation.
We are of the opinion that the aggregate Market Value, as at 30 June 2008, of these 90 freehold properties is €1,871,660,000 (one billion eight hundred and seventy one six hundred and sixty million euros).
This value reflects the following aggregate net yields
| % |
|---|
| 5.12 |
| 5.55 |
| 5.18 |
We confirm that all of the foregoing opinions of value, with the exception of Daimler Chrysler HQ property and the three Berlin City properties, are net of the requisite purchaser's costs of 5%. In respect of the Daimler Chrysler HQ investment property in Stuttgart purchaser's costs of 4.25% were adopted reflecting the high value of this single asset and the relatively low costs associated with its management For the three Berlin City properties, we have adopted the requisite purchaser's costs of 6% to reflect the higher rate of land transfer tax.
The market value of the portfolio is the sum of the individual market values of each of its assets. This aggregate figure makes no allowance for any effect that placing the whole portfolio on the market may have on the overall realisation. The market value of the portfolio sold as in a single transaction would not necessarily be the same as the aggregate figure reported.
In accordance with UK Practice Statement 5.4 we confirm the following:
This report is private and confidential and for the sole use of alstria office REIT-AG for publication in its reports and accounts and HSH Nordbank AG for calculation of debt covenant
HSH Nordbank AG is an agent and security agent under the facility agreement to be entered into with Alstria Office AG as borrower (the "Facility Agreement") for and on behalf of itself and each of HSH Nordbank AG, Natexis Banques Populaires and J. P. Morgan Plc as mandated lead arrangers under the Facility Agreement. HSH Nordbank AG, Natexis Banques Populaires and J. P. Morgan Chase Bank N.A. as original lenders under the Facility Agreement and each of their respective assignees or transferees (the "Finance Parties") and to each such Finance Party.
We do not accept any responsibility to any third party for the whole or any part of its contents.
Neither the whole nor any part of this valuation or any reference thereto may be included within any published document, circular or statement or disclosed in anyway without our prior written consent to the form and context in which it may appear. In breach of this condition, no responsibility can be accepted to third parties for the comments or advice contained in this report.
Yours faithfully
| Christopher J Fowler-Tutt BSc MRICS | Richard Barrett BSc MRICS |
|---|---|
| Director | Director |
| For and behalf of Colliers CRE | For and behalf of Colliers CRE |
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| ASSET NAME | CITY | TOTAL LETTABLE |
OFFICE AREA |
VACANCY | PASSING RENT | EVR * | OMV * |
|---|---|---|---|---|---|---|---|
| AREA (sqm) |
(sqm) | (sqm) | (EUR) | (EUR) | (EUR) | ||
| HAMBURG | |||||||
| Alte Koenigsstrasse 29 | Hamburg | 4,300 | 4,300 | - | 559,500 | 547,796 | |
| Alter Steinweg 4 | Hamburg | 32,000 | 32,000 | - | 3,952,200 | 4,317,660 | |
| Amsinckstr. 28 | Hamburg | 8,100 | 8,100 | - | 947,100 | 990,000 | |
| Amsinckstr. 34 | Hamburg | 6,200 | 6,200 | - | 723,200 | 765,000 | |
| Baeckerbreitergang 73 ** | Hamburg | 2,400 | 2,400 | 2,400 | - | ||
| Basselweg 73 | Hamburg | 2,700 | 2,300 | - | 258,900 | 291,600 | |
| Besenbinderhof 41 | Hamburg | 5,000 | 5,000 | - | 476,000 | 474,625 | |
| Buxtehuder Strasse 9-11a | Hamburg | 7,700 | 7,700 | - | 560,900 | 531,600 | |
| Drehbahn 36 | Hamburg | 26,200 | 26,200 | - | 3,238,700 | 3,228,000 | |
| Duesternstraße 10 *** | Hamburg | 2,200 | 2,200 | - | 263,800 | 264,000 | |
| Eppendorfer Landstr. 59 | Hamburg | 3,300 | 2,900 | - | 402,500 | 387,300 | |
| Ernst-Merck-Str. 9 | |||||||
| (Bieberhaus) | Hamburg | 17,500 | 15,600 | 1,374 | 2,129,400 | 2,322,673 | |
| Gaensemarkt 36 | Hamburg | 20,900 | 20,600 | 142 | 3,050,400 | 3,126,132 | |
| Garstedter Weg 13 | Hamburg | 3,600 | 3,600 | - | 342,700 | 358,800 | |
| Gorch-Fock-Wall 11 | Hamburg | 8,700 | 8,700 | - | 1,023,000 | 981,000 | |
| Gorch-Fock-Wall 15,17 | Hamburg | 7,700 | 7,700 | - | 805,700 | 768,000 | |
| Grindelberg 62-66 | Hamburg | 18,400 | 18,400 | - | 2,073,400 | 2,132,640 | |
| Grosse Bleichen | Hamburg | 17,800 | 15,800 | 5,300 | 1,980,000 | 5,700,955 | |
| Hamburger Strasse 1-15 | Hamburg | 19,600 | 9,200 | 6,250 | 1,986,400 | 3,009,846 | |
| Hamburger Strasse 43-49 | Hamburg | 20,500 | 20,500 | - | 2,357,300 | 2,608,296 | |
| Hammer Steindamm 129 | Hamburg | 7,200 | 7,200 | - | 544,500 | 522,000 | |
| Harburger Ring 17 | Hamburg | 3,100 | 1,600 | 335 | 297,700 | 344,285 | |
| Herthastraße 20 | Hamburg | 3,300 | 3,300 | - | 294,700 | 318,000 | |
| Johanniswall 4 | Hamburg | 14,100 | 13,300 | 38 | 1,679,600 | 1,804,829 | |
| Kaiser-Wilhelm-Strasse 79-87 | Hamburg | 5,500 | 5,100 | 2,533 | 294,300 | 937,200 | |
| Kanalstr. 44 | Hamburg | 8,300 | 8,300 | 415 | 1,047,600 | 948,960 | |
| Kattunbleiche 19 | Hamburg | 12,400 | 12,400 | - | 1,508,400 | 1,434,000 | |
| Kuemmelstrasse 5-7 | Hamburg | 15,700 | 15,700 | - | 1,366,900 | 1,938,000 | |
| Lenhartzstrasse 28 | Hamburg | 1,100 | 1,100 | - | 100,500 | 138,000 | |
| Ludwig-Rosenberg-Ring 41 | Hamburg | 5,000 | 4,400 | - | 456,200 | 504,960 | |
| Max-Brauer-Allee 41,43 ** | Hamburg | 3,100 | 3,100 | 3,100 | - | - | |
| Max-Brauer-Allee 89-91 | Hamburg | 9,800 | 9,800 | - | 898,100 | 924,000 | |
| Nagelsweg 41-45 | Hamburg | 6,200 | 6,100 | - | 880,100 | 957,015 | |
| Oejendorfer Weg 9-11 | Hamburg | 6,100 | 6,100 | - | 559,500 | 684,000 | |
| Osterbekstr. 96 *** | Hamburg | 7,400 | 7,400 | - | 551100 | 729,000 | |
| Ottenser Marktplatz 10/12 | Hamburg | 900 | 900 | - | 154,800 | 153,600 | |
| Poststr. 11 (Alte Post) | Hamburg | 6,600 | 4,900 | 83 | 1,194,900 | 2,530,425 | |
| Poststrasse 51 | Hamburg | 1,700 | 1,500 | 111 | 359,600 | 443,215 |
Based on valuation of Colliers CRE as of June 30, 2008 *
Cost method applied ** ***
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| ASSET NAME | CITY | TOTAL | OFFICE | VACANCY | PASSING RENT | EVR * | OMV * |
|---|---|---|---|---|---|---|---|
| LETTABLE | AREA | ||||||
| AREA | |||||||
| (sqm) | (sqm) | (sqm) | (EUR) | (EUR) | (EUR) | ||
| Rahlstedter Strasse 151-157 | Hamburg | 2,900 | 2,900 | - | 289,500 | 324,000 | |
| Schloßstrasse 60 | Hamburg | 11,900 | 11,900 | - | 962,500 | 1,042,200 | |
| Steckelhoern 12 | Hamburg | 14,700 | 14,400 | - | 1,868,800 | 1,977,000 | |
| Steinstrasse 10 | Hamburg | 26,800 | 26,800 | - | 3,239,600 | 2,928,000 | |
| Steinstrasse 7, Bartholomay- | |||||||
| Haus | Hamburg | 21,900 | 19,900 | 13,432 | 1,401,700 | 3,440,328 | |
| Wandsbeker Chaussee 220 | Hamburg | 3,200 | 2,700 | - | 366,000 | 373,920 | |
| 433,700 | 410,200 | 35,513 | 47,447,800 | 58,202,860 | 935,941,889 | ||
| STUTTGART | Stuttgart | ||||||
| Epplestrasse 225 | Stuttgart | 107,300 | 107,300 | - | 14,653,300 | 14,697,000 | |
| Ernsthaldenstr. 17 | Ditzingen | 2,600 | 2,500 | 128 | 239,900 | 260,400 | |
| Siemensstrasse 33 | 27,300 | 18,100 | 5,416 | 1,818,600 | 2,136,528 | ||
| 5,544 | |||||||
| 137,200 | 127,900 | 16,711,800 | 17,093,928 | 307,990,000 | |||
| DUSSELDORF AREA | Essen | ||||||
| Bamler Str. 1-5 | 36,300 | 36,300 | 3,773 | 3,802,200 | 4,221,701 | ||
| Benrather Schlossallee 29- | Dusseldorf | ||||||
| 33 / Ludolfstr. 3 | Dusseldorf | 5,000 | 5,000 | - | 522,200 | 530,400 | |
| Friedrichstrasse 19 | Wuppertal | 2,100 | 1,300 | - | 395,800 | 397,200 | |
| Gathe 78 | Neuss | 8,500 | 4,500 | 156 | 890,000 | 1,280,738 | |
| Jagenbergstrasse 1 | Dortmund | 24,700 | 24,000 | 4,479 | 3,409,900 | 2,958,000 | |
| Max-Eyth-Strasse 2 | Dusseldorf | 6,500 | 6,500 | 4,448 | 184,300 | 750,005 | |
| Mecumstrasse 10 | 8,600 | 8,600 | - | 1,228,100 | 1,253,230 | ||
| 91,700 | 86,200 | 12,856 | 10,432,400 | 11,391,274 | 164,680,000 | ||
| BERLIN | |||||||
| Darwinstr. 14-16/ | Berlin | ||||||
| Quedlinburgerstr. 1-3 | Berlin | 22,200 | 22,200 | - | 3,245,500 | 3,240,000 | |
| Holzhauser Str. 175-177 | Berlin | 7,500 | 7,200 | 3,099 | 421,200 | 723,526 | |
| Marburger Str. 10 | 6,200 | 6,100 | 29 | 888,100 | 906,447 | ||
| 35,900 | 35,500 | 3,128 | 4,554,800 | 4,869,973 | 72,450,000 | ||
| MUNICH | Munich | ||||||
| Arnulfstrasse 150 | Munich | 5,900 | 5,900 | - | 974,500 | 1,096,200 | |
| Hofmannstrasse 51 | Munich | 22,100 | 22,100 | - | 2,427,500 | 2,778,000 | |
| Landshuter Allee 174 | 6,900 | 6,500 | - | 900,000 | 1,167,000 |
| 34,900 | 34,500 | - | 4,302,100 | 5,041,200 | 75,250,000 | ||
|---|---|---|---|---|---|---|---|
| HANOVER | Hanover | ||||||
| Arndtstrasse 1 | Hanover | 10,200 | 9,800 | - | 1,017,600 | 1,135,200 | |
| Vahrenwalder Strasse 133 | Hanover | 7,100 | 7,000 | - | 991,600 | 1,012,062 | |
| Werner-von-Siemens-Platz 1 | 21,700 | 21,700 | - | 1,862,700 | 1,986,000 | ||
| 39,000 | 38,500 | - | 3,872,000 | 4,133,262 | 60,600,000 | ||
* Based on valuation of Colliers CRE as of June 30, 2008
Valuation Report > Portfolio Overview
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| > Contact | |
|---|---|
| -- | ----------- |
| ASSET NAME | CITY | TOTAL LETTABLE AREA |
OFFICE AREA |
VACANCY | PASSING RENT | EVR * | OMV * |
|---|---|---|---|---|---|---|---|
| (sqm) | (sqm) | (sqm) | (EUR) | (EUR) | (EUR) | ||
| SAXONY | Zwickau | ||||||
| Lothar-Streit-Strasse 10b | Leipzig | 1,000 | 1,000 | - 140,100 |
115,200 | ||
| Ludwig-Erhard-Strasse 49 | Leipzig | 6,300 | 6,300 | - 731,500 |
700,800 | ||
| Nikolaistrasse 16 | Dresden | 1,200 | 900 | 334 | 143,500 | 160,232 | |
| Washingtonstrasse 16-16a | Dresden | 20,700 | 19,800 | 4,985 | 1,227,200 | 1,610,351 | |
| Zellescher Weg 21-25a | Dresden | 6,500 | 5,600 | 279 | 757,900 | 647,187 | |
| Zwinglistr. 11-13 | 3,200 | 3,100 | 1,699 | 100,500 | 233,621 | ||
| 38,900 | 36,700 | 7,297 | 3,100,800 | 3,467,391 | 43,650,000 | ||
| COLOGNE / BONN | Bonn | ||||||
| Bertha-von-Suttner-Platz 17 | Cologne | 1,400 | 1,400 | - 197,000 |
219,600 | ||
| Bonner Strasse 351 | Cologne | 10,900 | 10,500 | - 1,475,500 |
1,504,740 | ||
| Gereonsdriesch 13 | Cologne | 2,400 | 2,200 | - 346,900 |
345,576 | ||
| Horbeller Str. 11 | 6,700 | 6,700 | 1,692 | 479,800 | 648,000 | ||
| 21,400 | 20,800 | 1,692 | 2,499,200 | 2,717,916 | 39,050,000 | ||
| OTHER | Nuremberg | ||||||
| Am Graeslein 12 | Erfurt | 2,700 | 2,500 | 588 | 250,600 | 342,000 | |
| Am Roten Berg 5 | Mannheim | 5,300 | 4,300 | 1,843 | 175,000 | 312,681 | |
| Carl-Reiß-Platz 1,3,5 | 17,700 | 17,500 | 1,251 | 1,591,800 | 1,725,332 | ||
| Doktorweg 2-4 / | Detmold | ||||||
| Bismarkstr. 3 | Frankfurt | 9,800 | 9,800 | - 804,800 |
831,618 | ||
| Emil-von-Behring-Strasse 2 | Augsburg | 9,300 | 8,900 | - 1,495,200 |
1,572,000 | ||
| Eserwallstrasse 1-3 | Frankfurt | 5,600 | 5,500 | - 711,100 |
731,271 | ||
| Goldsteinstr. 114 | Wiesbaden | 8,500 | 8400 | 72 | 1,083,200 | 1,331,346 | |
| Gustav-Nachtigal-Str. 3 | Wiesbaden | 18,400 | 18,200 | - 2,410,200 |
2,412,000 | ||
| Gustav-Nachtigal-Str. 4 | Magdeburg | 700 | 700 | - 107,700 |
117,840 | ||
| Halberstaedter Strasse 17 | Potsdam | 7,600 | 7,600 | 588 | 608,400 | 688,800 | |
| Helene-Lange-Strasse 6-7 | Erfurt | 3,400 | 3,100 | 59 | 384,100 | 412.800 | |
| Johannesstrasse 164-165 | Halle | 5,800 | 4,400 | 330 | 518,800 | 567.600 | |
| Joliot-Curie-Platz 29-30 | 1,100 | 500 | - 112,200 |
110,400 | |||
| Regensburger Strasse | Nuremberg | ||||||
| 223-231 | Darmstadt | 8,900 | 7,300 | 436 | 1,003,400 | 1,098,000 | |
| Rheinstrasse 23 | Wurzburg | 2,700 | 2,600 | - 317,200 |
334,099 | ||
| Schweinfurter Strasse 4 | Jena | 5,100 | 4,400 | 608 | 448,900 | 551,640 | |
| Spitzweidenweg 107 | Mannheim | 3,300 | 3,300 | 1,038 | 150,000 | 241,061 | |
| Steubenstrasse 72-74 | 4,100 | 4,100 | - 533,000 |
500,648 | |||
| 120,000 | 113,100 | 6,813 | 12,705,500 | 13,881,136 | 176,670,000 |
Total
952,700 903,400
105,626,400 120,798,940 72,843 1,876,281,889
* Based on valuation of Colliers CRE as of June 30, 2008
Valuation Report > Portfolio Overview > Review Report > Financial Calendar
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We have reviewed the condensed consolidated interim financial statements - comprising the condensed balance sheet, condensed income statement, condensed cash flow statement, condensed statement of changes in equity and selected explanatory notes - and the interim group management report of alstria office REIT-AG for the period from January 1 to June 30, 2008, which are part of the half-year financial report pursuant to § (Article) 37w WpHG ("Wertpapierhandelsgesetz": German Securities Trading Act). The preparation of the condensed consolidated interim financial statements in accordance with the IFRS applicable to interim financial reporting as adopted by the EU and of the interim group management report in accordance with the provisions of the German Securities Trading Act applicable to interim group management reports is the responsibility of the parent Company's Board of Managing Directors. Our responsibility is to issue a review report on the condensed consolidated interim financial statements and on the interim group management report based on our review.
We conducted our review of the condensed consolidated interim financial statements and the interim group management report in accordance with German generally accepted standards for the review of financial statements promulgated by the Institut der Wirtschaftsprüfer (Institute of Public Auditors in Germany) (IDW). Those standards require that we plan and perform the review so that we can preclude through critical evaluation, with moderate assurance, that the condensed consolidated interim financial statements have not been prepared, in all material respects, in accordance with the IFRS applicable to interim financial reporting as adopted by the EU and that the interim group management report has not been prepared, in all material respects, in accordance with the provisions of the German Securities Trading Act applicable to interim group management reports. A review is limited primarily to inquiries of company personnel and analytical procedures and therefore does not provide the assurance attainable in a financial statement audit. Since, in accordance with our engagement, we have not performed a financial statement audit, we cannot express an audit opinion.
Based on our review, no matters have come to our attention that cause us to presume that the condensed consolidated interim financial statements have not been prepared, in all material respects, in accordance with the IFRS applicable to interim financial reporting as adopted by the EU nor that the interim group management report has not been prepared, in all material respects, in accordance with the provisions of the German Securities Trading Act applicable to interim group management reports.
Berlin, August 18, 2008 PricewaterhouseCoopers Aktiengesellschaft Wirtschaftsprüfungsgesellschaft
Wirtschaftsprüfer Wirtschaftsprüfer (German Public Auditor) (German Public Auditor)
sgd. Gregory Hartman sgd. ppa. Markus Salzer
Valuation Report > Portfolio Overview
Review Report
Financial Calendar > Contact
| Annual General Meeting, Hamburg |
|---|
| 11th Annual Property Conference by Morgan Stanley, London |
| Sal. Oppenheim Real Estate Conference, Vienna |
| Publication of financial results of Q2 2008 |
| Property Finance Europe German Property Breakfast, London |
| Roadshow JPMorgan, Frankfurt |
| EPRA Annual Conference, Stockholm |
| Hamburger Börsentag, Hamburg |
| Roadshow JPMorgan, USA |
| Roadshow JPMorgan, Paris |
| Roadshow JPMorgan, Benelux |
| Roadshow JPMorgan, London |
| EXPO REAL, München |
| Pan-European Real Estate conference, London |
| Initiative Immobilien Aktie, Frankfurt |
| EPRA Reporting and Accounting Summit, Brussel |
| Publication of financial results of Q3 2008 |
| Sal. Oppenheim Conference, New York |
alstria office REIT-AG Fuhlentwiete 12 20355 Hamburg Tel.: +49 (0) 40 226 341 -300 E-mail: [email protected] www.alstria.de
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