DGAP-Adhoc: Peach Property Group AG : Construction work for 'yoo berlin' and 'Am Zirkus 1' twin project in full swing again
04.10.2013 – 17:50
Peach Property Group AG / Key word(s): Real Estate 04.10.2013 17:45 Release of an ad hoc announcement pursuant to Art. 53 KR --------------------------------------------------------------------------- Press release Construction work for 'yoo berlin' and 'Am Zirkus 1' twin project in full swing again - Finishing work for 'yoo berlin' and 'Am Zirkus 1' projects has been fully resumed following insolvency of general contractor BSS Beton-System-Schalungsbau GmbH - Completion and hand-over to buyers planned for spring of 2014 - 85 percent of all trade contracts already awarded or finalised - Additional costs of EUR 15 million due to higher construction and financing costs and penalties as a result of delayed completion - Construction work at major project in Hamburg and all other projects of the Group proceeds according to plan Zurich, 4 October 2013 - Peach Property Group AG, a leading property investor and developer of high-quality residential real estate in the German-speaking region of Europe, today announced that it has fully resumed the internal finishing work for the 'yoo berlin' and 'Am Zirkus 1' twin projects in Berlin following the insolvency of the general contractor, BSS Beton-System-Schalungsbau GmbH. Hand-over to the buyers is expected to take place in the spring of 2014. Due to considerably higher construction costs, which have become apparent in the course of awarding contracts to the trades, and due to higher financing costs and penalties payable to the future buyers and tenants as a result of the delayed completion, the total costs incurred by Peach Property Group will increase by around EUR 15 million (CHF 19 million). The vast majority of these additional costs will impact on the earnings of the current 2013 financial year, which is expected to be negative as a result. Returns from these projects will decrease as well: In contrast to the figure of CHF 75 million announced at the 2013 financials press conference, Peach Property Group now expects the ongoing projects to be completed in 2013 and 2014 to generate net returns of around CHF 55 million. Peach Property Group AG had taken over coordination of the construction activities in Berlin following the insolvency of the previous general contractor, BSS Beton-System-Schalungsbau GmbH, in June 2013. In the meantime, Peach Property Group has directly awarded or finalised around 85 percent of all contracts for trades in connection with 'yoo berlin' and 'Am Zirkus 1'. Final offers have been submitted for a further 10 percent. This means that costs and schedules have been fixed for around 95 percent of the construction work to be performed. Both projects are currently in the stage of internal finishing work. More than two-thirds of the construction work has already been performed. Around 80 percent of the projects' units have been marketed and no less than 90 percent have been let. In the second quarter of 2013, Peach Property Group had also taken over coordination from the previous general contractor, Peter Holthausen GmbH & Co. KG, for the major 'Harvesterhuderweg 36' project in Hamburg. Construction work there continued seamlessy without additional costs and is proceeding according to plan. As a result, this project will be completed and the residential units will be handed over before the end of the year. Around 65 percent of the apartments have already been sold including authentication by a notary public or reserved. Thomas Wolfensberger, CEO of Peach Property Group AG, states: 'Having no less than two general contractors - both of whom were established companies with a previously positive credit rating - filing for insolvency was a huge challenge. We mastered this challenge with our experienced team by taking swift and decisive action. We have done everything to get the two Berlin projects, 'yoo berlin' and 'Am Zirkus 1' back on track as soon as possible. We are delighted that we managed to do this and are looking forward to completing this twin project soon. However, like the other institutional developers who worked with BSS we are very unhappy about the delays and extra costs this involves.' Contacts Media, investors and analysts Dr. Thomas Wolfensberger, Chief Executive Officer Bruno Birrer, Chief Operating Officer +41 (0) 44 485 50 00 | investors@peachproperty.com Media Germany: edicto GmbH, Axel Mühlhaus +49 (0) 69 90 55 05 52 | amuehlhaus@edicto.de About Peach Property Group Peach Property Group AG one of the leading developers in the field of top-quality residential property in the German-speaking region of Europe. Its activities cover the entire prime property development value chain, from site evaluation to project planning, implementation and marketing. Peach Property Group focuses on city and holiday residences in exceptional locations and featuring highest-quality fittings for a discerning clientele. The company's integrated corporate strategy encompasses not only the development of exclusive residential properties, but also the management of investment properties for the purpose of generating consistent annual revenues. Peach Property Group AG is headquartered in Zurich and also has a branch office in Cologne. The company's shares are listed on SIX Swiss Exchange (PEAN, ISIN CH0118530366). Visit www.peachproperty.com for more information. +++++ Additional features: Document: http://n.equitystory.com/c/fncls.ssp?u=EORHICLMIK Document title: Construction work for 'yoo berlin' and 'Am Zirkus 1' twin project in full swing again 04.10.2013 News transmitted by EQS Schweiz AG. The issuer is responsible for the contents of the release. EquityStory publishes regulatory releases, media releases on the capital market and press releases. The EquityStory Group distributes authentic and real-time financial news for over 1'300 listed companies. The Swiss news archive can be found at www.equitystory.ch/news --------------------------------------------------------------------------- Language: English Company: Peach Property Group AG Seestrasse 346 8038 Zürich Switzerland Phone: +41 44 485 50 00 Fax: +41 44 485 50 11 E-mail: investors@peachproperty.com Internet: www.peachproperty.com ISIN: CH0118530366 Valor: A1C8PJ Listed: Freiverkehr in Berlin, Stuttgart; Frankfurt in Open Market ; SIX End of Announcement EQS Group News-Service ---------------------------------------------------------------------------