Friday, 14 March 2025
LEG Immobilien SE reported strong financial results for 2024, with AFFO reaching EUR 200.4 million, slightly exceeding the company’s mid-year forecast. The company maintained steady performance, benefiting from strong demand for affordable housing and solid leasing activity. The completion of the majority acquisition of Brack Capital Properties on January 3, 2025, expanded LEG’s portfolio by approximately 9,000 apartments, further strengthening its position in the residential real estate sector.
The company saw improvements in key operational indicators, with the like-for-like vacancy rate decreasing to 2.3 percent and rental income increasing by 3.4 percent. The rise in rental income was driven by the free-market segment, as regulated rental rates in the subsidized housing sector remained stable. The average rent for LEG’s properties now stands at EUR 6.80 per square meter. Throughout the year, the company focused on maintaining cost efficiency, with total investments amounting to EUR 436.5 million, in line with the previous year.
The proposed dividend for 2024 is EUR 2.70 per share, reflecting a full distribution of AFFO in line with the company’s dividend policy. This corresponds to a yield of 3.3 percent based on the share price at the end of 2024. The company’s financial stability was reinforced by the stabilization of portfolio valuation, with a slight increase of 0.4 percent in the second half of the year. At year-end, the valuation of LEG’s residential portfolio averaged EUR 1,629 per square meter, and the gross yield of the portfolio stood at 4.9 percent.
LEG continued its asset management strategy by selling approximately 2,500 apartments for EUR 255 million to strengthen its balance sheet. Additional sales of 1,800 units are expected to generate EUR 62 million in net proceeds. The company remains cautious with acquisitions but continues to assess opportunities in the transaction market. Financing costs averaged 1.49 percent at the end of 2024, supported by the issuance of a EUR 700 million convertible bond and the repayment of higher-interest debt. Net debt declined by 2.2 percent to EUR 8.8 billion, with the loan-to-value ratio improving to 47.9 percent.
Looking ahead to 2025, LEG expects further stability in property values and continued demand for rental housing. AFFO is projected to be between EUR 205 million and EUR 225 million, potentially reflecting a 7 percent increase per share compared to 2024. The company plans to increase investment per square meter for the first time in two years, from EUR 34 to over EUR 35. LEG also aims to integrate sustainability with financial performance, targeting CO2 reductions and long-term revenue contributions from its green business initiatives.
