Financials

UNAUDITED FINANCIAL STATEMENTS AND DISTRIBUTION ANNOUNCEMENT FOR THE FOURTH QUARTER AND FINANCIAL YEAR ENDED 31 DECEMBER 2017

Financials Archive

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Profit or Loss

Profit and Loss

Balance Sheet

Balance Sheet

Commentary

The German economy ended 2017 on a positive note, with a higher GDP growth of 2.2% compared to the growth rate of 1.9% achieved in 2016(1). Driving this healthy growth was a combination of favourable business sentiment, domestic consumption and higher employment. This has lent support to the office real estate market in Germany, both in terms of investment and leasing demand. In 2018, Germany is expected to remain as one of the main destinations for European commercial real estate investments, in view of the sound economic fundamentals, firm occupier demand and rising rents.

For FY 2018, the operating performance of IREIT's existing properties should continue to be supported by its freehold quality assets, blue chip tenant base and long leases, with notably no lease expiries in the 12 months ahead. As previously announced, IREIT has already undertaken hedging for its FY 2018 distributions at an average hedge rate of approximately S$1.63 per Euro. From 2019, in accordance with its currency hedging policy, IREIT will be hedging its income to be repatriated from overseas to Singapore on a quarterly basis.

IREIT will make the remaining two partial loan repayments of €1.275 million each in 1H 2018 in accordance with the loan amortisation schedule for the short-term loan facility provided by HSH Nordbank AG. The Manager has been in discussions with HSH Nordbank AG with regards to the remaining principal of €18.5 million which is currently due to expire in July 2018. Following these discussions, the Manager has received credit approval from the bank to extend the maturity date of the facility by two years without amortisation, and is now in the process of finalising the legal documentation. A separate announcement with further details will be provided in due course.

In the year ahead, IREIT will continue to pursue its growth strategy based on the four pillars of seeking diversification, adopting a long-term approach, achieving scale, and leveraging on Tikehau Capital's established local presence.

Footnotes:

  1. Federal Statistical Office of Germany, 2018