The real estate value of Intervest Retail continues to grow

Antwerp, 31 October 2007 - Public property investment fund Intervest Retail[1] releases today its results on 30 September 2007. (comparable figures 30 September 2006 between brackets) The growing demand for commercial real estate on the rental and investment market persists. Rental renewals in the commercial portfolio of Intervest Retail are hence concluded at higher rents. Consequently, the real estate portfolio of the property investment fund knows during the first nine months of 2007 a revaluation of Eur 15 million of 5 %. On 30 September 2007, the total occupancy rate[2] of the portfolio amounts to 96,2 % (95,5 % end 2006). Without taking into account Factory Shopping Messancy the occupancy rate amounts to 99,1 %. The sale of Factory Shopping Messancy has been further organised during the third quarter of 2007. Negotiations are ongoing with several interested parties. During the first nine months of 2007, the net rental income decreases to Eur 12,6 million (Eur 14,1 million) as a result of the sale of properties mid 2006, the increase of the financials compensations for the tenants of Factory Shopping Messancy, the growing number of doubtful debtors in Factory Shopping Messancy and the one-time indemnity in the third quarter of prior year from the property developer of Factory Shopping Messancy (Eur 0,8 million related to rental income). The property charges amount to Eur 2,9 million (Eur 2,6 million). The rise is due to the increasing operating costs in Factory Shopping Messancy. It concerns principally marketing and service charges which, from a commercial point of view, can not be charged to the tenants. The general costs decrease to Eur 0,7 million during the first nine months of 2007 (Eur 0,9 million). The operating result before the result on the portfolio amounts to Eur 8,8 million (Eur 10,7 million). The decrease of Eur 1,9 million is the direct result of the lower net rental income and the increasing property charges. During the third quarter of 2007, Intervest Retail has sold a inner-city shop located in Charleroi with a surface area of 948 m², with a gain in value of Eur 0,6 million compared to the fair value of Eur 2,4 million. The positive change of the fair value of the entire real estate portfolio of the investment property fund amounts to Eur 15,5 million on 30 September 2007 compared to Eur 3,4 million on 30 September 2006. The financial result amounts to - Eur 3,3 million (- Eur 2,8 million) due to the increase of the interest charges as a result of the rise of the short-term interest rates. Besides, the property investment fund received as a result of the arbitrational judgment against the property developer of Factory Shopping Messancy in the third quarter of 2006 a one-time amount of Eur 0,1 million moratory interests. The net result of the first nine months of 2007 amounts to Eur 21,4 million (Eur 10,1 million). The important increase of the net result is due to the revaluation of the real estate portfolio in 2007 with Eur 15,5 million compared to 2006 (Eur 3,4 million). The net result can be divided in a distributable operating result of Eur 5,5 million (Eur 7,9 million) and the result on the portfolio of Eur 15,9 million (Eur 2,2 million). On 30 September 2007 this means distributable earnings per share of Eur 1,10 (Eur 1,56). The fair value of the portfolio on 30 September 2007 amounts to Eur 296 million (Eur 281 million on 31 December 2006). This rise is mainly the combined effect of the increase in value of the commercial portfolio (Eur 15 million), the investment in the Julianus project in Tongeren (Eur 3 million) and the sale of three non strategic properties in 2007 (- Eur 4 million). On 30 September 2007 the net asset value (fair value) of the share amounts to Eur 36,51 (Eur 34,21 on 31 December 2006). Given that the share price on 30 September 2007 is Eur 30,60, the Intervest Retail share is quoted with a discount of 16 % compared to this net asset value (fair value). In accordance with the calculation method of article 6 of the RD of 21 June 2006, the debt ratio amounts to 38 % on 30 September 2007 (39% on 31 December 2006). The net result of the financial year 2007 is negatively influenced by the financial situation in Factory Shopping Messancy. Hence, it is expected for 2007 that the earnings per share will be significantly lower than in 2006. On the basis of the forecast published in the half-year brochure of 2007, the company expects for the entire year 2007 distributable earnings per share around Eur 1,45 (gross dividend). Indeed, the result of 2006 had a one-time positive effect due to the indemnity received from the arbitrational procedure against the property developer of Factory Shopping Messancy (Eur 1 million). Note to the editors: for more information, please contact: Intervest RETAIL SA, Jean-Paul Sols - CEO or Inge Tas - CFO, tel. 03/287.67.87, 1 Intervest Retail is a public property investment fund listed on Euronext Brussels in the Next Prime Segment. 2 The occupancy rate is calculated as the ratio of the actual rental income to the same rental income plus the estimated rental value of the vacant locations for rent. For the entire pdf-version with figures of this press release, please click on the link below: