IREIT (UD1U) Q2 2024 earnings summary

Executive summary

• Net property income rose 22.8% year-over-year to €27.0m, driven by new contributions and a one-time €15.5m dilapidation cost from Berlin Campus's main tenant.

• Gross revenue increased 28.8% year-over-year to €36.6m, mainly from the B&M Portfolio acquisition and Berlin Campus income, offset by Il·lumina divestment.

• Distribution per unit (DPU) grew 3.2% to €0.96 cents, with income to be distributed to unitholders up 3.9%.

• Portfolio comprises 53 properties across Germany, Spain, and France, with major new leases and refurbishments in Spain and Germany.

• Net assets attributable to unitholders decreased to €532.9m from €545.6m at end-2023.

Financial highlights

• Net property income: €27.0m (+22.8% YoY); gross revenue: €36.6m (+28.8% YoY).

• Net income before tax and fair value changes: €19.7m, up 30.4% year-over-year.

• Net change in fair value of investment properties: -€19.4m (improved from -€34.1m YoY).

• Cash and cash equivalents increased to €71.5m, mainly from Il·lumina divestment proceeds.

• Total return attributable to unitholders: €0.2m (vs. €-17.5m in 1H 2023), reflecting lower negative fair value changes.

Outlook and guidance

• European office and investment markets have stabilized but remain below 10-year averages; retail market shows resilience.

• Lower inflation, rising real wages, and expected rate cuts to support recovery in European real estate.

• Plans to reposition Berlin Campus into a multi-let, mixed-use asset in 2025, with advanced lease negotiations underway.

• Focus on securing new leases and renewals to improve occupancy.