German property group Aroundtown reports big loss for 2023

By Marleen Kaesebier and Chiara Holzhaeuser

March 27 (Reuters) - Aroundtown AT1.DE, one of Germany's largest listed landlords, on Wednesday reported a 2.436 billion euro ($2.64 billion) loss for 2023, showing how the country's worst real-estate crisis in decades is impacting property companies.

German real estate companies are having to cope with a property market downturn after boom years fuelled by low interest rates. The country's largest property company Vonovia VNAn.DE this month reported a record loss of more than 6 billion euros for 2023.

Aroundtown's loss was much wider than the 457.1 million euros it reported in 2022.

Its shares, which are down about 30% year to date, fell as much as 8% in early trading and were at the bottom of the German midcap index .MDAXI. They were up 1.1% by 0845 GMT.

On Tuesday, the company said it would suspend its dividend to "remain conservative in regard to capital preservation and to continue to focus on strengthening liquidity and de-leveraging."

"We were expecting this suspension (and for the next two years as well)," Jefferies analysts wrote in a note.

Aroundtown's real estate subsidiary Grand City PropertiesGYC.DE also said earlier in March that it would not pay a dividend for 2023.

Aroundtown reported funds from operations, excluding disposal gains, of 332 million euros, down 8% from the previous year and meeting its guidance for 2023.

The Luxembourg-based company said it expected its funds from operations to fall further in 2024, giving a range of 280 million to 310 million euros.

Aroundtown reported property revaluations amounting to negative 3.2 billion euros, a like-for-like devaluation of 11%.

The company increased its liquidity to 3 billion euros, up 11% from 2022, selling property assets worth 1.2 billion euros and taking on 1 billion euros of new bank debt.

It also said its liquidity position now covers debt maturities until mid 2026.

($1 = 0.9236 euros)

(Reporting by Marleen Kaesebier and Chiara Holzhaeuser; Editing by Kim Coghill, Jamie Freed and Jane Merriman)


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


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