In This Article:
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Net Rent Increase: More than 7%.
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AFFO Growth: Increased by 28%.
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Like-for-Like Rent Increase: 3.5% in Q1.
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Average In-Place Rent: EUR6.87 per square meter.
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Net Quarter Rent: Grew by 7.2% to EUR229.5 million.
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Recurring Net Operating Income: Increased by 8.7% to EUR186 million.
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EBITDA Margin: Improved by 200 basis points to 75.6%.
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Cash and Cash Equivalents: EUR830 million at the end of March.
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Loan-to-Value (LTV): Increased to 48.4%.
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Interest Coverage Ratio (ICR): Improved to 4.4 times.
Release Date: May 13, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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LEG Immobilien SE (LEGIF) reported a strong net rent increase of more than 7%, supported by the integration of BCP and organic growth.
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The company's AFFO increased by 28%, indicating strong cash generation from its core business.
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The integration of BCP is operationally and financially complete, contributing EUR12 million to rental growth.
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LEG Immobilien SE (LEGIF) successfully refinanced two-thirds of BCP's financing, maintaining an average interest cost of 1.55%.
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The company is on track to achieve a 7% bottom-line growth for the year, supported by robust operational performance and strategic disposals.
Negative Points
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The company's LTV increased slightly to 48.4% due to the first-time consideration of BCP, which is above their midterm target of 45%.
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Investment levels were sluggish compared to Q1 2024, with a minor decline in adjusted investments per square meter.
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The disposal of Eastern German units, including those in Leipzig, reflects challenges in scaling operations in that region.
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The rental growth is somewhat dependent on the publication of rent tables, which can delay execution.
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Despite a robust transaction market, geopolitical tensions and macroeconomic risks pose potential challenges.
Q & A Highlights
Q: What drove the decision to sell BCP's East Germany portfolio, and how is the deal structured? A: Lars Von Lackum, CEO, explained that the decision to sell the Eastern German assets, including Leipzig, was due to the inability to scale quickly enough to justify a new office. The sale could be structured as a full portfolio or split into parts to maximize shareholder value.
Q: Can you provide an update on the development land plots acquired as part of the BCP deal? A: Lars Von Lackum, CEO, stated that there are two plots: one in Grafenberg, intended for sale after demolishment, and another in Gerresheim, where they are negotiating with the city for potential development or sale.