European Real Estate suffers 9.0% fall in NAV during first Half

ERET : European Real Estate sees NAV fall 9.0% during first Half

European Real Estate‘s NAV has fallen 9% during the first half of 2014. The value of the portfolio reduced by £4.0m relating to a ‘re-gearing’ of the Panrico leases (this saw a 25% reduction in rent in exchange for ‘useful’ lease changes) and a shortenning of a lease to IBM. A strengthening of sterling also led to exchange losses of £2.5 million.

ERET remains focused on the sale of its remaining assets, of which there are three:  Kaiserslautern, Nice and Panrico (comprising four separate properties). The car park at Kaiserslauter was sold for €5.0 million and a capital return by way of share redemption of 19.3p was made on 11 July 2014. ERET retains the retail centre at Kaiserslautern and reports that complexities, associated with the leasehold structure, have made this asset difficult to sell.

ERET reports that Panrico have restructured their business and ERET is hopeful that this will put Panrico on a firmer footing. In addition, ERET has agreed to sell the Panrico unit at Murcia that suffered extensive fire damage. The proceeds of the sale together with insurance proceeds total €3.2m.

The campus of office buildings at La Gaude, Nice (pictured) will be vacated by IBM in 2015 and options are being reviewed for the site.


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