Fair Value REIT-AG

EANS-News: Fair Value REIT-AG closes Q1 2011 successfully and raises forecasts

- IFRS consolidated net income increases by 50% to EUR 1.8 million (previous year: EUR 1.2 million) - Adjusted consolidated net income (EPRA-Earnings) at EUR 1.3 million, 25% above quarterly related forecast - Significant increase in forecasts for 2011 and 2012

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quarterly report/Guidance

Subtitle: - IFRS consolidated net income increases by 50% to EUR 1.8 million (previous year: EUR 1.2 million) - Adjusted consolidated net income (EPRA-Earnings) at EUR 1.3 million, 25% above quarterly related forecast - Significant increase in forecasts for 2011 and 2012

München (euro adhoc) - Munich, Germany, May 12, 2011 - Fair Value REIT-AG reports a very successful start to 2011. The group ended the first quarter of the year with a consolidated net income of EUR 1.8 million or EUR 0.20 per share, a considerable increase on the figures of EUR 1.2 million and EUR 0.13 per share for the same period in the previous year. The increase compared to the previous year is primarily the result of an income effective market value increase of cash flow hedges in the equity accounted participations.

The consolidated earnings adjusted for market value changes and other, non-operative effects (EPRA-Earnings) amounted to EUR 1.3 million or EUR 0.14 per share (previous year: EUR 1.5 million or EUR 0.16 per share), which was 25% higher than forecast for 2011 on a quarterly basis.

The operating income of EUR 1.2 million was in line with expectations and was 40% lower than the previous year´s figure of EUR 2.0 million, mainly because of re-letting related expenses. In contrast, the results of the equity accounted associated companies more than doubled, increasing by EUR 1.0 million to EUR 1.9 million. Of this increase, 20% is attributable to an increase in net rental revenues and 80% to an improved valuation of derivative financial instruments, as recorded in the respective profit and loss statements.

On the balance sheet date, the group´s equity capital amounted to EUR 77.8 million (31 December 2010: EUR 74.6 million). The balance sheet net asset value (NAV) per share in circulation thus increased by 4% to EUR 8.35 (31 December 2010: EUR 8.00). Taking into account the minority holdings in the subsidiaries, the equity ratio as defined in section 15 REITG (German REIT Law) increased to 51.3% of the immovable assets (31 December 2010: 49.6%).

Frank Schaich, CEO of Fair Value REIT-AG, considers the basis for the pleasing performance of the group to be a stable earnings base and a positive market environment: "An occupancy rate in our proportionate real estate portfolio of approximately 93% and an average remaining lease term of 6 years continues to provide us with a good level of planning confidence, and the stable market environment helps us achieve lease renewals and new leasing agreements. As a result of the turnaround in the development of interest rates, the market value of our cash flow hedges has also increased. This has had a positive effect on the consolidated net income as well as contributing to an increase in the consolidated equity, without affecting net income."

At the end of April 2011, a loan held by an associated company, that had originally been fixed until December 31, 2014, was replaced by a new, variable interest rate property loan with a term of 5 years and by an interest rate cap. The result is that, already from 2011, the relevant associated company will make savings of more than 50% on the previous interest payments. This has a corresponding positive effect, expected to amount to approximately EUR 0.6 million per annum, on the Fair Value REIT-AG proportionate IFRS earnings from equity accounted participations.

"It was possible to negotiate a relatively small prepayment penalty. Already from May 2011 we can thus utilise the reduction of more than 50% in the interest payments in order to generate a significant improvement in earnings," explains Frank Schaich, who continues: "Taking into account results from the first quarter, we have raised our forecasts for the current financial year and also for next year. For 2011 we are now expecting an increase in the adjusted consolidated net income from EUR 4.3 million to EUR 5.0 million (EUR 0.54 per share), and in 2012 we are expecting an increase from EUR 5.1 million to EUR 5.7 million (EUR 0.61 per share).

The report for the first quarter of 2011 is now available at www.fvreit.de, in the Investor Relations area.

Selected financial indicators of Fair Value REIT-AG:

January - March 2011    January - March 2010
Rental revenues                 2.6 Mio. EUR            3.1 Mio. EUR
EBIT                            1.2 Mio. EUR            2.0 Mio. EUR
Adjusted consolidated income    1.3 Mio. EUR            1.5 Mio. EUR
EPRA EPS                        0.14 EUR                0.16 EUR
IFRS consolidated net income    1.8 Mio. EUR            1.2 Mio. EUR
IFRS EPS                        0.20 EUR                0.13 EUR

                                          March 31, 2011      December 31. 2010
Balance sheet NAV per share                     8.35 EUR        8.00 EUR
EPRA-NAV per share                              9.05 EUR        8.93 EUR
Equity ratio under § 15 of the REIT Act:        51.3%           49.6%

Corporate profile

Fair Value REIT-AG, based in Munich, focuses on the acquisition, leasing,
property management and sale of commercial properties in Germany. At the core of
its investment activities are office and retail properties in German regional
centres. Because of its REIT status, Fair Value is exempt from corporation and
trade tax. In addition to investing in properties directly, Fair Value also
invests in real estate funds.

Through direct investments and subsidiaries, the Fair Value Group manages a
portfolio of 51 commercial properties with a total leasable floor space of
around 163,000 square metres and a market value as of December 31, 2010 of
around EUR 129 million. (Fair Value's share on these investments amounted to
around EUR 93 million as of March 31, 2011).

In addition, Fair Value REIT-AG holds minority interests in six closed-end real
estate funds with holdings in 23 commercial properties and a total leasable
floor space of around 269 000 square metres. As of 31 December 2010, the total
market value of these properties was EUR 365 million. (Fair Value's share on
these investments amounted to around EUR 130 million as of March 31, 2011). 

As of March 31, 2011, Fair Value's share on the total portfolio amounted to around EUR 223 million. At present, this represents an occupancy rate of 93.1% of the achievable rents at full occupancy of EUR 19.6 million per annum. As of March 31, 2011, the weighted remaining term of the leases was 6.0 years. Around 44% of the potential rent relate to retail floor space, 42% to office space and 14% to other facilities.

end of announcement                               euro adhoc



Fair Value REIT-AG
Frank Schaich
Tel.: 089-9292815-10
Fax: 089-9292815-15
E-Mail: schaich@fvreit.de

Branche: Real Estate
ISIN: DE000A0MW975
Index: CDAX, Classic All Share, Prime All Share, RX REIT All Share
Index, RX REIT Index
Börsen: Frankfurt / regulated dealing/prime standard
Berlin / free trade
Stuttgart / free trade
Düsseldorf / free trade
München / free trade

Weitere Meldungen: Fair Value REIT-AG

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