Strong letting year: Net absorption of 83,900 sqm, development portfolio 70% pre-let 
In 2019 alstria capitalized on the strong letting market in its core investment centers. With 197,600 sqm of new leases and 171,300 sqm of lease extensions, the company increased its like-for-like contractual rent by 9.7% from EUR 189.9 million to EUR 208.3 million. Substantial long-term leases were signed with public tenants securing long-term cash flows and increasing the WAULT (weighted average unexpired lease-term) of the total portfolio to 6.3 years (2018: 4.8 years). alstria’s development portfolio, comprising eight projects with a lettable space of 184,000 sqm, recorded a strong improvement of the pre-letting rate to 70% as per December 31, 2019. The secured rents of EUR 26.0 million on this sub-portfolio provide a secured source of alstria’s top line growth going forward. 

Demand for real estate assets drives capital values: Valuation gain of EUR 2.56 per share
The value of alstria’s investment properties increased by 12.7% to EUR 4,439 million as per December 31, 2019. alstria’s strong operational performance was the main reason for the revaluation gain amounting to EUR 454.8 million (EUR 2.56 per share). The valuation yield stood at 4.7% (2018: 4.9%) and represents a capital value of EUR 2,966 per sqm and is still well below replacement costs. alstria continued to take advantage of the strong investment market and pursued its strategy to further concentrate its portfolio on the main German office markets. In the course of the year, six assets located in secondary locations, were sold for a total consideration of EUR 139.7 million at an average book gain of 11.2% compared to the valuation as per December 31, 2018. In parallel, alstria bought five buildings in its core markets for EUR 49.3 million and continued to expand its refurbishment program. This selective capital recycling approach is allowing alstria to further improve the overall risk profile of the portfolio.

Strong balance sheet: EPRA NAV up to EUR 17.91 per share, LTV down to 27.1%
The consolidated net profit drove alstria’s IFRS equity to EUR 3,176 million, representing an increase of EUR 429 million in 2019. The EPRA NAV per share amounted to EUR 17.91 and was up by 18.3% year-on-year (December 31, 2018: EUR 15.14). alstria’s net LTV improved further to 27.1% (2018: 30.4%) and the net debt/EBITDA multiple was 8.5x. The Interest Coverage Ratio (ICR) stood at 5.8. alstria’s G-REIT equity ratio¹ improved to 70.9% (2018: 67.2%), underlining the company’s balance sheet quality. alstria is rated BBB (positive outlook) by Standard & Poor’s.

Operations in-line with plan: Revenues at EUR 187.5 million and FFO at EUR 112.6 million
In 2019 revenues amounted to EUR 187.5 million (2018: EUR 193.2 million). The slight loss of rental income was mainly due to the disposal of non-core assets and the related loss of rental income, as well as the acceleration of the refurbishment pipeline. The 2019 FFO amounted to EUR 112.6 million and was in-line with the full-year guidance of EUR 112.0 million. alstria’s FFO margin further improved to 60.0% (2018: 59.4%), which was mainly due to lower costs. The consolidated profit of EUR 581.2 million increased by 10% compared to the prior year period and was driven by the valuation uplift and the strong operating result.

Dividend proposal: EUR 0.53 per share, thereof EUR 1 cent “Green Dividend”
The Management Board will propose to the Annual General Meeting a dividend payment of EUR 0.53 per share, which represents an increase of 1 cent compared to 2018 (EUR 0.52). The increase of 1 cent per share is proposed as “Green Dividend”.

alstria, which has been at the forefront of the sustainability discussion in the European real estate sector for a number of years, is proposing to its shareholders a new dividend concept (the “Green Dividend”) of EUR 0.01 per share². 

There seems to be a general understanding that it is unlikely that the target of the Paris Agreement will be reached with a “business as usual” approach. As a first step, alstria is earmarking EUR 1.8 million to accelerate the Company’s pace of action in reducing its carbon footprint. alstria has identified the projects that could be implemented and has quantified the impact it could have³. alstria will ask its AGM to take a majority vote that will decide whether the Company should pay the Green Dividend to all the shareholders or keep the funds. If shareholders decide to receive the Green Dividend, they will be able to invest the proceeds in a more efficient climate mitigation project. On the other hand, if shareholders ask the company to keep the Green Dividend, they will provide alstria with a clear mandate to invest outside of its financial norms. Whatever the AGM’s decision is, alstria would have contributed around 2% of its dividend toward climate mitigation issues.   

Outlook 2020: Revenues of EUR 179 million, FFO of EUR 108 million 
For the current year 2020, alstria expects revenues of EUR 179 million and funds from operations (FFO) of EUR 108 million. The decline compared to 2019 is due to the disposal of non-core properties.

“2019 has been and extra-ordinary strong year for the company”, said Olivier Elamine, CEO of alstria. “Our operational teams have been able to take advantage of every opportunity available in our markets to the benefit of the company, and our financing team was yet again able to reduce our average cost of funding. While we need to celebrate this short-term performance, we shall also stress that this year’s performance has delivered and secured a solid foundation for our top line growth in the future. This growth is now embedded in the refurbishment portfolio’s strong pre-letting and will deliver constantly in the coming years. Looking beyond finance, we are also acutely aware of the challenges brought forward by climate change and are suggesting for the first time a “Green Dividend” as a new tool of funding for ecological projects and of communication between companies and shareholders. The “Green Dividend” is more concrete and more operational than any CSR reporting. We have no doubt that it will lead to controversial debates and are looking forward for the dialogue.”

1) Defined as total IFRS equity divided by immovable assets value on the balance sheet
2) The decision on the Green Dividend by the AGM has no influence whatsoever of the regular dividend payment of EUR 0.52 per share.
3) For more information and a description of the “Green Dividend” please see www.green-dividend.com 

Invitation to the telephone conference on February 27, 2020 
The alstria management board, CEO Olivier Elamine and CFO Alexander Dexne, will present the 2019 financial results and the outlook 2020 in a telephone conference at 10:00 am (CET) which will also be webcasted on our website (www.alstria.com). The full Annual report (Company report and Audited Financial Statements) will also be available for download on our website.

Please use one of the following dial-in numbers:
Germany:     +49 69 2017 44 220
UK:              +44 20 3009 2470
PIN:             934 86 465#