Author: pp_admin

> Significant increase in market value of real estate portfolio and rental income thanks to acquisitions and advances in investment properties in the first six months of 2019
> Expansion of the investment property portfolio to 8,775 residential units with annualised target rent of CHF 46.4 million
> Investments in residential portfolios of CHF 8.7 million in the first half of 2019
> Vacancies further reduced by 11 percent to 10.7 percent of residential units
> Additions to tenant services, opening of new tenant shops
> Profit before taxes at a solid CHF 25 million and after taxes at around CHF 22 million
> IFRS equity increased to CHF 311 million from CHF 301 million at the end of 2018

Peach Property Group, an investor specializing in portfolio management in Germany with a focus on residential real estate, has increased the market value of its real estate portfolio in the first half of 2019 to a new high of slightly more than CHF 793 million thanks to increased investments in the real estate portfolio. Compared with the end of the first half of 2018, this is an increase of a good 35 percent, and more than 6 percent compared with the end of 2018. At CHF 19.3 million, rental income in the period under review was around 40 percent higher than the CHF 13.8 million recorded in the comparative period. Annualized target rent increased by 6 percent to CHF 46.4 million compared with the end of 2018. This increase was achieved by expanding the investment portfolio, progressing the renovation of apartments and reducing vacancies. At the same time, the share of the development properties was further reduced as planned with the handover of apartments and the completion of projects.

Expansion of the real estate portfolio, progress in renovation and reduction of vacancies

In the first six months of 2019, Peach Property Group expanded its real estate portfolio to 8,775 units with a total rental area of around 600,000 square metres through the purchase of 421 apartments. This corresponds to an increase of 4 percent compared with the end of 2018. The residential portfolio in the Kaiserslautern region was expanded by 200 apartments to more than 1,350 units. In addition, ownership of 221 apartments in Marl, North Rhine-Westphalia, was transferred at the beginning of 2019.

Additionally, Peach Property Group invested almost CHF 9 million in modernising its real estate portfolio in the first half of 2019. 376 apartments were refurbished, more than twice as many units as in the same period last year. As a result of this and increased letting activities, Peach Property Group was able to reduce the number of unlet apartments by around 11 percent to 940 units or 10.7 percent of the portfolio. Of these, 127 units have been reserved or leases have already been signed, 129 units are being marketed and a further 128 apartments are currently being renovated. The remaining 556 vacant apartments represent the current letting reserve and will be successively refurbished and marketed in the coming quarters.

Expansion of tenant services – efficiency further increased

Peach Property Group further expanded its services for tenants in the first half of 2019, thereby increasing tenant satisfaction. In addition to the stores in Oberhausen and Heidenheim a tenant shop, Peach Point, has now also been opened in northern Hesse. Further tenant shops are planned for the second half of the year in Minden (Bielefeld) and Kaiserslautern. Peach Property Group already manages more than half of its portfolio, a total of over 4,800 apartments, through its own tenant shops in central city centre locations. After the opening of the two new stores, the figure will rise to 85 percent.

Peach Property Group also successfully increased its efficiency. The further insourcing of the portfolio administration resulted in the reduction of direct administration costs from 13.2 percent to 9.4 percent of actual rents.

Pre-tax profit at CHF 25 million – equity at CHF 311 million

Peach Property Group recorded a profit before taxes of CHF 25.4 million and after taxes of CHF 22.3 million in the reporting period. With the completion of the “Wollerau Park” project and hand-overs of the last apartments in the projects in Berlin and Rorschach, all development projects have been finalized except for the “Peninsula” in Wädenswil, Switzerland. As expected, the volume of income from development projects was substantially lower than in the same period of the previous year at CHF 7.3 million compared to CHF 21.9 million in H1 2018, along with a correspondingly lower contribution to earnings. In the first half of 2018, pre-tax profit amounted to CHF 30.7 million and after-tax profit to CHF 26.5 million.

Equity rose from CHF 301.3 million at the end of 2018 to CHF 310.9 million at the end of the first half of 2019. Due to the significant increase in total assets by a good 4 percent to CHF 857 million, the equity ratio (NAV at market values) as at 30 June 2019 was 37.1 percent, slightly below the level of 37.7 percent at the end of 2018.

2019 outlook

For the remainder of 2019 Peach Peach Property Group is focusing on continuing its renovation work, and thus further reducing vacancies as well as expanding its tenant services. All apartments in the portfolio shall be managed by the Group itself by the end of 2019 in order to further optimize operating processes and increase efficiency. In addition, numerous purchase portfolios are under review in order to expand the investment portfolio to the medium-term target of 11,000 apartments.

Dr. Thomas Wolfensberger, Peach Property Group’s CEO, commented: “Peach Property Group has once again enjoyed substantial growth in the first six months of the year. We were able to increase the value of our portfolio through targeted investments in renovation, the reduction of vacancies and the purchase of additional portfolios. In addition, we further expanded our management platform and opened an additional Peach Point. The direct contact with our tenants and a high degree of digitisation in asset and property management mean that we can ideally combine customer satisfaction with efficiency. We will consistently continue along this path and are well prepared for our further growth.”

The 2019 semi-annual report can be downloaded from the Investor Relations section of Peach Property Group’s Web site, http://peachproperty.com, using the following link: http://peachproperty.com/investoren/publikationen/

Contacts:

Media, investors and analysts
Dr. Thomas Wolfensberger, Chief Executive Officer and Dr. Marcel Kucher, Chief Financial Officer
+41 44 485 50 00 | investors@peachproperty.com

Media Germany
edicto GmbH, Axel Mühlhaus, Peggy Kropmanns
+49 (0)69 90 55 05 52 | amuehlhaus@edicto.de

About Peach Property Group AG

Peach Property Group is a property investor and developer focused on investments in Germany. The Group stands for long time experience, competence and quality. Innovative solutions for modern housing needs, strong partnerships and a wide value chain complete the profile of the Group. The portfolio consists of an increasing number of high yield investment properties, typically in B-cities in close reach to metropolitan areas. In addition, the Group develops properties for its own portfolio or for the sale as condominium. Developments for sale focus on A-locations and encompass attractive architecture and high level furnishing for an international clientele. The business activities of the Group cover the entire value chain, from property acquisition and site selection to active asset management and finally to the sale or lease of properties.

Peach Property Group AG is headquartered in Zurich and has its German Group headquarters in Cologne. Peach Property Group AG is listed on the SIX Swiss Exchange (PEAN, ISIN CH0118530366). Its Board of Directors consists of Reto Garzetti (President), Peter Bodmer, Dr. Christian De Prati and Kurt Hardt.

For more information, see http://peachproperty.com

The shareholders of Peach Property Group AG, an investor specialising in holding investment properties and focusing on residential real estate, today accepted all of the proposals made by the Supervisory Board at today’s general meeting in Zurich with a clear majority. Around 39 percent of share capital was represented at the meeting.

Among other topics, the General Meeting confirmed the Chairman of the Supervisory Board Reto Garzetti and the board members Peter Bodmer, Dr. Christian De Prati and Kurt Hardt for a further year in office. In line with the proposal, it was also decided not to pay a dividend for the 2018 financial year, as the funds are to be used primarily for the further expansion and optimisation of the real estate portfolio. Finally, shareholders approved a general revision of the Articles of Association. The new Articles of Association will be available on the Peach Property Group website once they have been published in the commercial register.

The minutes of this year’s General Meeting will also be available there shortly.

Contacts:
Media, investors and analysts
Dr. Thomas Wolfensberger, Chief Executive Officer and Dr. Marcel Kucher, Chief Financial Officer
+41 44 485 50 00 | investors@peachproperty.com

Media Germany
edicto GmbH, Axel Mühlhaus, Peggy Kropmanns
+49 (0)69 90 55 05 52 | amuehlhaus@edicto.de

About Peach Property Group AG
Peach Property Group is a property investor and developer focused on investments in Germany and Switzerland. The Group stands for long time experience, competence and quality. Innovative solutions for modern housing needs, strong partnerships and a wide value chain complete the profile of the Group. The portfolio consists of an increasing number of high yield investment properties, typically in B-cities in close reach to metropolitan areas. In addition, the Group develops properties for its own portfolio or for the sale as condominium. Developments for sale focus on A-locations and encompass attractive architecture and high level furnishing for an international clientele. The business activities of the Group cover the entire value chain, from property acquisition and site selection to active asset management and finally to the sale or lease of properties.

Peach Property Group AG is headquartered in Zurich and has its German Group headquarters in Cologne. Peach Property Group AG is listed on the SIX Swiss Exchange (PEAN, ISIN CH0118530366). Its Board of Directors consists of Reto Garzetti (President), Peter Bodmer, Dr. Christian De Prati and Kurt Hardt.

For more information, see http://peachproperty.com

=> Significant increase in rental income and real estate value, completion of the “Wollerau Park” project and efficiency gains ensure best result in the Company’s history
=> Actual rents increase by 82% to CHF 30 million due to vacancy reduction and new acquisitions; annualized target rental income increases by 54% to CHF 44 million
=> Market value of investment portfolio up by 53% to CHF 694 million due to portfolio expansion and operational progress; number of apartments increases to 8.400 units.
=> Operating FFO I before taxes increases by more than 60% to CHF 4.4 million
=> Equity (IFRS) up by more than 16% to CHF 301 million
=> Outlook for 2019 confirmed: Further increase in rental income and operating efficiency; medium-term target of 11,000 apartments in the portfolio

Peach Property Group, an investor specialising in the management of residential property, has recorded a significant increase in its profits according to its finalised figures for fiscal year 2018, and thus a new record-breaking figure. The preliminary figures published in February 2019 have been fully confirmed. Significantly higher rental income compared to the previous year, value-adding asset management measures and the completion of the “Wollerau Park” development project in particular contributed to the significant increase in profits. Earnings before taxes rose by a good 10 percent to around CHF 57 million and earnings after taxes were up by 8 percent to CHF 45 million in the year under review – despite a negative currency translation effect of CHF 4.5 million. Adjusted for tax effects, operating FFO I (funds from operations) increased by more than 60 percent to CHF 4.4 million. At the same time, direct operating costs rose at a disproportionately low rate of only 7 percent compared to the previous year.

The expansion of the investment portfolio by more than 50 percent to over 8,400 residential units and the optimization of existing units with a significant reduction in vacancies from 16.8 percent to 13.6 percent increased actual rental income by around 82 percent to CHF 30 million. Annualized target rental income amounted to approximately CHF 44 million, which corresponds to an increase of 54 percent over the year. Numerous measures directly benefiting tenants, such as investments of around CHF 12 million in our apartments, the opening of new tenant shops (Peach Points), the further development of the tenant app and the new internet portal for tenants, contributed to this positive development.

The market value of the investment portfolio increased to CHF 694 million at the end of 2018, up by 53 percent compared to the end of 2017, due to portfolio expansion and value-enhancing measures. The market value of the entire real estate portfolio rose by 44 percent to CHF 747 million. Despite the significant increase in the value of the portfolio, gross profits rose from 5.4 to 5.6 percent, emphasizing the sustainability of the activities and valuations.

Peach Property Group also demonstrates a very solid financial structure in 2018. In line with its investment strategy, over 92 percent of all financial liabilities were non-current. The average term increased to over 6 years. On the equity side, the significant annual profit and the net effect of the issue of a 1.75 percent hybrid option bond in June 2018 of just under CHF 60 million and the repayment of the 5 percent hybrid bond led to an increase in equity (IFRS) from CHF 259 million to CHF 301 million. Despite the significant increase in total assets, the equity ratio (IFRS) remained solid at 36.7 percent after 41.6 percent at the end of 2017. At market values, the ratio was 37.7 percent. Cash and cash equivalents at the end of 2018 amounted to more than CHF 53 million after CHF 49 million in the previous year, which provides sufficient funds to meet the medium-term growth targets.

For 2019, the Peach Property Group is reaffirming its goals of significantly increasing rental income once again and further increasing operational efficiency. Optimizing the existing portfolio with targeted renovations, reducing vacancies and intensifying tenant communication are further points that the Group will focus on in 2019.

Dr. Thomas Wolfensberger, Peach Property Group’s CEO, commented: “2018 marks a key step for our Group in implementing our growth strategy and we are very pleased with the portfolio growth, project completions and profits we have achieved. For 2019, we have set ourselves the target of once again significantly increasing rental income. This is not least evident in the portfolio, which was strongly expanded in 2018, and the two new acquisitions, which were certified shortly before and after the turn of the year. However, we are also planning further acquisitions in order to achieve our medium-term target volume of 11,000 residential units in our portfolio. Our tenants and their satisfaction are at the top of our list of priorities. In this regard, we are following the successful path we have taken so far and would like to introduce further significant process improvements in 2019.”

Contacts:
Media, investors and analysts
Dr. Thomas Wolfensberger, Chief Executive Officer and Dr. Marcel Kucher, Chief Financial Officer
+41 44 485 50 00 | investors@peachproperty.com

Media Germany
edicto GmbH, Axel Mühlhaus, Peggy Kropmanns
+49 (0)69 90 55 05 52 | amuehlhaus@edicto.de

About Peach Property Group AG
Peach Property Group is a property investor and developer focused on investments in Germany and Switzerland. The Group stands for long time experience, competence and quality. Innovative solutions for modern housing needs, strong partnerships and a wide value chain complete the profile of the Group. The portfolio consists of an increasing number of high yield investment properties, typically in B-cities in close reach to metropolitan areas. In addition, the Group develops properties for its own portfolio or for the sale as condominium. Developments for sale focus on A-locations and encompass attractive architecture and high level furnishing for an international clientele. The business activities of the Group cover the entire value chain, from property acquisition and site selection to active asset management and finally to the sale or lease of properties.

Peach Property Group AG is headquartered in Zurich and has its German Group headquarters in Cologne. Peach Property Group AG is listed on the SIX Swiss Exchange (PEAN, ISIN CH0118530366). Its Board of Directors consists of Reto Garzetti (President), Peter Bodmer, Dr. Christian De Prati and Kurt Hardt.

For more information, see http://peachproperty.com

=> Residential portfolio up by more than 50 percent to some 8,400 units, acquisition of a further 421 apartments completed in January 2019
=> Actual rental income increased by more than 80 percent to just under CHF 30 million
=> Annualized target rent up by 53 percent to CHF 44 million; further increase as of January 2019 to CHF 46.4 million
=> Vacancy rate reduced from 16.8 to 13.6 percent
=> Operating margin of residential hold portfolio increased from 67 to 71 percent
=> IFRS equity ratio at the end of 2018 expected to be slightly below 37 percent

Peach Property Group, an investor specialising in the management of residential property has recorded the best result in its history in 2018, according to unaudited preliminary figures. Earnings before taxes in the past fiscal year were up by a roughly 10 percent year-on-year to almost CHF 57 million. This was mainly due to operational progress and the further expansion of the existing portfolio. The record result was achieved despite negative currency translation effects due to the weakening of the euro against the Swiss franc, which amounted to approximately CHF 4.5 million. In 2017, positive currency translation effects of around CHF 7.7 million were recorded.

According to initial key data, actual rental income rose by a good 80 percent year-on-year to just under CHF 30 million in 2018, while annualized target rental income rose by 53 percent to CHF 44 million and stood at approximately CHF 46.5 million at the end of January 2019. This was achieved with a more than 50 percent increase in portfolio size to over 8,400 units. The acquisition of a further 421 apartments were completed in January 2019.
In addition to the acquisitions, Peach Property’s active asset management with targeted investments in properties and tenant-oriented property management also had a positive effect. This approach includes the traditional “Peach on Tour” food truck and portfolio-wide gardening festivals in spring, as well as, in particular the opening of the new Peach Points (tenant shops) in Heidenheim and Oberhausen and the new tenant app and tenant Internet portal. This made it possible to implement measures even more efficiently and quickly and to establish a direct dialogue with tenants. In addition, these measures also significantly reduced the vacancy rate, which stood at 13.6 percent ytd at the end of December 2018, compared to 16.8 percent a year earlier.

The operating margin, which puts direct property costs in relation to total actual rental income, was up from 67 percent in the previous year to 71 percent at the end of 2018. Peach Property Group was also able to significantly increase efficiency with regard to overhead costs: As a result of systematic leverage of the existing platform, operating costs increased at a significantly slower rate than revenue growth and were only 7 percent higher than in the previous year.

According to preliminary figures, the market value of Peach Property Group’s existing portfolio increased by a good 53 percent to CHF 694 million in 2018. This was due to acquisitions and value-enhancing asset management, which was reflected in a year-on-year increase of around six percent in the value of properties already included in the real estate portfolio. As a result of the earnings recorded, the equity increased significantly in 2018. Despite the significant increase in total assets as a result of the portfolio growth, the equity ratio according to IFRS is hence expected to be a solid 37 percent at the end of 2018, only slightly below the previous year’s level of 41.6 percent.

For the 2019 fiscal year, Peach Property Group expects a further significant increase in rental income and a further increase in operating efficiency from the systematic use of the existing platform. In addition, Peach Property Group will continue to invest in its existing portfolio in the future and its active management will further increase tenant satisfaction and thus reduce vacancies.

In the medium term, Peach Property Group is set to expand its portfolio to around 11,000 residential units. Given the more than CHF 50 million on hand at the end of 2018, the group is well positioned to achieve this target.

Dr. Thomas Wolfensberger, Peach Property Group’s CEO, commented: “The figures for 2018 show that we have made very good operational progress. Of course, further growth and the expansion of the property portfolio are essential factors, but in our view value-enhancing measures in our existing property portfolio, the tenant satisfaction and the reduction of vacancies are equally important. We are proud of our achievements and are continuing to work on it. Enhancing our presence with local tenants via our Peach Points has paid off, and so has expanding digital communication with the tenants and thus offering an innovative service”.

Contacts:
Media, investors and analysts
Dr. Thomas Wolfensberger, Chief Executive Officer and Dr. Marcel Kucher, Chief Financial Officer
+41 44 485 50 00 | investors@peachproperty.com

Media Germany
edicto GmbH, Axel Mühlhaus, Peggy Kropmanns
+49 69 90 55 05 52 | amuehlhaus@edicto.de

About Peach Property Group AG

Peach Property Group is a property investor and developer focused on investments in Germany and Switzerland. The Group stands for long time experience, competence and quality. Innovative solutions for modern housing needs, strong partnerships and a wide value chain complete the profile of the Group. The portfolio consists of an increasing number of high yield investment properties, typically in B-cities in close reach to metropolitan areas. In addition, the Group develops properties for its own portfolio or for the sale as condominium. Developments for sale focus on A-locations and encompass attractive architecture and high level furnishing for an international clientele. The business activities of the Group cover the entire value chain, from property acquisition and site selection to active asset management and finally to the sale or lease of properties.

Peach Property Group AG is headquartered in Zurich and has its German Group headquarters in Cologne. Peach Property Group AG is listed on the SIX Swiss Exchange (PEAN, ISIN CH0118530366). Its Board of Directors consists of Reto Garzetti (President), Peter Bodmer, Dr. Christian De Prati and Kurt Hardt.

For more information, see http://peachproperty.com

=> Purchase agreement signed for a further 200 apartments in Kaiserslautern
=> Peach Property Group’s residential portfolio in Kaiserslautern increases to a good 1,300 units
=> New apartments are in very good condition with 95.5 percent occupancy rate
=> Peach Property Group’s annual target rental income up to around CHF 46.5 million p.a. as a result of the transaction

Peach Property Group, an investor specialising in the management of residential property in Germany, has notarised the purchase agreement for 200 apartments in Kaiserslautern. The transaction will be closed with economic effect as of 1 January 2019. The acquisition brings the total number of residential units owned by Peach Property Group in Kaiserslautern to a good 1,300 and the Group’s total residential portfolio to around 8,800 units. Around 99 percent of the Group’s portfolio is located in Germany. Peach Property Group’s annual target rental income is up by 2.4 percent to a total of CHF 46.5 million p.a. as a result of the transaction.

The new apartments in the centre of Kaiserslautern are in very good condition and have an occupancy rate of 95.5 percent. Nearly all facades of the buildings, most of which were built between the end of the so-called Gründerzeit and the 1950s, have already been renovated and a good two thirds of the apartments have been refurbished in recent years. The apartments are all located in the immediate vicinity of the buildings already held by Peach Property Group in Kaiserslautern.

Dr. Thomas Wolfensberger, Peach Property Group’s CEO, commented: “We are very pleased that we have reached a substantial portfolio size in Kaiserslautern and can leverage further synergies through effective administration. The new purchase in Kaiserslautern means that we can now offer our tenants a wide range of apartments – from medium to high quality and in various city locations. We have taken another step towards our medium-term goal of 11,000 units.”

Contacts:

Media, investors and analysts
Dr. Thomas Wolfensberger, Chief Executive Officer and Dr. Marcel Kucher, Chief Financial Officer
+41 44 485 50 00 | investors@peachproperty.com

Media Germany
edicto GmbH, Axel Mühlhaus, Peggy Kropmanns
+49 69 90 55 05 52 | amuehlhaus@edicto.de

About Peach Property Group AG

Peach Property Group is a property investor and developer focused on investments in Germany and Switzerland. The Group stands for long time experience, competence and quality. Innovative solutions for modern housing needs, strong partnerships and a wide value chain complete the profile of the Group. The portfolio consists of an increasing number of high yield investment properties, typically in B-cities in close reach to metropolitan areas. In addition, the Group develops properties for its own portfolio or for the sale as condominium. Developments for sale focus on A-locations and encompass attractive architecture and high level furnishing for an international clientele. The business activities of the Group cover the entire value chain, from property acquisition and site selection to active asset management and finally to the sale or lease of properties.

Peach Property Group AG is headquartered in Zurich and has its German Group headquarters in Cologne. Peach Property Group AG is listed on the SIX Swiss Exchange (PEAN, ISIN CH0118530366). Its Board of Directors consists of Reto Garzetti (President), Peter Bodmer, Dr. Christian De Prati and Kurt Hardt.

For more information, see http://peachproperty.com

=> Purchase agreement signed for residential portfolio comprising 221 apartments with 95.5% occupancy rate in the Rhine-Ruhr metropolitan region; transaction expected to be closed at the beginning of January 2019
=> Total residential portfolio increases to approx. 8,600 units with lettable space of 560,000 m2
=> Closing completed for all other acquisitions made in 2018
=> Company confirms medium-term target to grow overall stock to 11,000 apartments and reviews purchase of further residential portfolios

Peach Property Group, an investor specialising in the management of residential property in Germany, today announced the notarisation of an agreement for the acquisition of a portfolio comprising 221 residential units in Marl in the German state of North Rhine-Westphalia. The apartments are in good condition and currently exhibit an occupancy rate of 95.5 percent. They are located not far from the portfolios already held by Peach Property Group in the Rhine-Ruhr area, which allows administrative synergies to be achieved. The transaction is expected to be completed at the start of January 2019, lifting the total number of units in the Peach Group’s residential portfolio to over 8,600 units with lettable space of 560,000 square metres. The annual target rent will increase by 2.9 percent to CHF 45.5 million.

In addition to this new acquisition, Peach Property also completed all previous property acquisitions as of the beginning of December. These include around 1,100 apartments in Heidenheim near Ulm and just under 400 units in North Rhine-Westphalia and Lower Saxony.

Dr. Thomas Wolfensberger, CEO of Peach Property Group, comments: “We are delighted to be able to further strengthen and consolidate our portfolio in North Rhine-Westphalia with this acquisition in Marl and that we have also managed to fully integrate all the portfolios acquired in 2018. This puts us in an excellent position to grow our residential portfolio to 11,000 units in the medium term. Additional acquisitions are reviewed on an ongoing basis.”

Contacts:
Media, investors and analysts
Dr. Thomas Wolfensberger, Chief Executive Officer and Dr. Marcel Kucher, Chief Financial Officer
+41 44 485 50 00 | investors@peachproperty.com

Media Germany
edicto GmbH, Axel Mühlhaus, Peggy Kropmanns
+49 69 90 55 05 52 | amuehlhaus@edicto.de

About Peach Property Group AG
Peach Property Group is a property investor and developer focused on investments in Germany and Switzerland. The Group stands for long time experience, competence and quality. Innovative solutions for modern housing needs, strong partnerships and a wide value chain complete the profile of the Group. The portfolio consists of an increasing number of high yield investment properties, typically in B-cities in close reach to metropolitan areas. In addition, the Group develops properties for its own portfolio or for the sale as condominium. Developments for sale focus on A-locations and encompass attractive architecture and high level furnishing for an international clientele. The business activities of the Group cover the entire value chain, from property acquisition and site selection to active asset management and finally to the sale or lease of properties.

Peach Property Group AG is headquartered in Zurich and has its German Group headquarters in Cologne. Peach Property Group AG is listed on the SIX Swiss Exchange (PEAN, ISIN CH0118530366). Its Board of Directors consists of Reto Garzetti (President), Peter Bodmer, Dr. Christian De Prati and Kurt Hardt.

For more information, see http://peachproperty.com

Peach Property Group, an investor specialising in the management of residential property in Germany, is planning to repay its 2015 hybrid bond as early as possible (Swiss Securities Code: 30571164, ISIN; CH0305711647). Accordingly, the Company is terminating the bond in accordance with Section 4.2 of the bond terms and conditions on 15 December 2018. Termination is associated with the redemption of all units.

The interest rate on the perpetual bond was previously 5.00 percent and would have increased to 3-month LIBOR plus 9.25 percent p.a. from mid-December 2018.

Dr. Thomas Wolfensberger, Peach Property Group’s CEO: “By terminating the bond, we are paying back the funds on the first possible date and thereby strengthen our free funds from operations (FFO) as of 2019. Even after the repayment, we have sufficient funds available for the medium-term expansion of the portfolio to 11,000 apartments. This underlines our Group’s financial strength.”

Contacts:
Media, investors and analysts
Dr. Thomas Wolfensberger, Chief Executive Officer and Dr. Marcel Kucher, Chief Financial Officer
+41 44 485 50 00 | investors@peachproperty.com

Media Germany
edicto GmbH, Axel Mühlhaus, Peggy Kropmanns
+49 69 90 55 05 52 | amuehlhaus@edicto.de

About Peach Property Group AG
Peach Property Group is a property investor and developer focused on investments in Germany and Switzerland. The Group stands for long time experience, competence and quality. Innovative solutions for modern housing needs, strong partnerships and a wide value chain complete the profile of the Group. The portfolio consists of an increasing number of high yield investment properties, typically in B-cities in close reach to metropolitan areas. In addition, the Group develops properties for its own portfolio or for the sale as condominium. Developments for sale focus on A-locations and encompass attractive architecture and high level furnishing for an international clientele. The business activities of the Group cover the entire value chain, from property acquisition and site selection to active asset management and finally to the sale or lease of properties.

Peach Property Group AG is headquartered in Zurich and has its German Group headquarters in Cologne. Peach Property Group AG is listed on the SIX Swiss Exchange (PEAN, ISIN CH0118530366). Its Board of Directors consists of Reto Garzetti (President), Peter Bodmer, Dr. Christian De Prati and Kurt Hardt.

For more information, see http://peachproperty.com

> Operating profit (EBITDA) up 72% to CHF 37.1 million and earnings after taxes up 66% to CHF 26.5 million
> Residential portfolio increased by 16% to 6,436 units
> Transfer of ownership of a good 1,900 additional apartments already acquired lifts property portfolio to 8,400 apartments by the end of 2018
> Actual rental income more than doubled to CHF 13.8 million (previous year: CHF 6.8 million)
> Increase in occupancy rate and efficiency gains in terms of cost structures
> Equity ratio of 46.8 percent and liquid funds of CHF 91.6 million provide excellent basis for further growth

Peach Property Group, an investor specialising in the management of residential property in Germany, announced today that it improved its earnings after taxes in the first six months of 2018 by around 66 percent year-on-year, from CHF 16.0 million to CHF 26.5 million. Operating profit (EBITDA) rose to CHF 37.1 million, up from CHF 21.5 million in the previous year, representing an increase of 72 percent. This significant increase in profits is attributable to the portfolio expansion, value-enhancing measures in the property portfolio, an improvement in the letting situation and an attractive contribution to profits made by development activities. Due to the depreciation of the Swiss franc against the Euro, however, the financial result in the reporting period includes negative currency effects of around CHF 2.2 million, while a positive currency effect of CHF 2.0 million was recorded in the same period last year.

Actual rental income more than doubled to CHF 13.8 million – market value of portfolio rises to CHF 530 million

Actual rental income in the first six months of the year more than doubled year-on-year, increasing by around CHF 7.0 million from CHF 6.8 million to CHF 13.8 million as a result of the expanded residential property portfolio, a further tenant-focused improvement of the properties and a reduction in vacancies. As of 30 June 2018, the portfolio of the Peach Property Group consisted of 6,436 residential units. This represents a year-on-year increase of around 2,200 units and an increase of just under 900 apartments compared to the end of 2017. The transfer of ownership of another 1,900 apartments already acquired will take place in the second half of 2018, lifting the Group’s portfolio to just under 8,400 units comprising a lettable floor area of around 540,000 square metres. As a result, annual target rental income will increase to CHF 44.3 million, from CHF 34.3 million at the end of the first half of 2018 and CHF 28.6 million at the end of 2017.

As of 30 June 2018, the market value of the investment portfolio was approx. CHF 530 million (+17 percent compared to 31 December 2017).

Occupancy rate further improved – efficiency gains in terms of cost structures achieved

Peach Property Group invested approximately CHF 4.2 million in specific maintenance and modernisation measures during the reporting period. The focus was on increasing tenant satisfaction and improving the letting situation. The occupancy rate in the residential portfolio rose to 85.5 percent as of 30 June 2018, an improvement of around 3 percent compared with the 2017 year-end figure of 83.2 percent. Excluding the refurbishment properties in Neukirchen-Vluyn and Fassberg, the occupancy rate is 91 percent.

Thanks to efficient property management, costs have only seen a disproportionately low increase despite the significant growth. The direct costs of the investment properties amounted to just under 31 percent of rental income in the first six months of 2018, compared with 37 percent in the same period last year. At 17 percent, overhead costs (personnel and other operating expenses) in the reporting period also rose at a significantly lower rate than the portfolio and earnings.

“Wollerau Park” completed – profit contribution of CHF 5.6 million

Peach Property Group pushed ahead with the remaining development projects in the first half of 2018. Construction work on the “Wollerau Park” project near Zurich with 46 apartments and 5 commercial units was completed. Except for one apartment, all units were either sold or reserved. This resulted in a profit contribution of CHF 5.6 million for the reporting period, which corresponds to 26.5 percent of the sales revenue generated.

Increase in FFO I before tax by 300 percent

The completion of “Wollerau Park” and the sale of the apartments resulted in income taxes of CHF 4.5 million Euros, whereas a tax refund of CHF 2.2 million was recognised in the previous year. As a result of these tax effects, funds from operations I (FFO I) of CHF 1.3 million were below the previous year’s figure of CHF 3.5 million. Excluding these tax effects, FFO I increased by around 300 percent. This reflects the major efficiency gains from portfolio growth.

Equity ratio rises to 45.9 percent (46.8 percent at market values)

Due to the substantial half-year profit and the funds from the 1.75 percent hybrid warrant bond of CHF 60 million issued in June 2018, Peach Property Group’s equity increased to CHF 316.6 million as of 30 June 2018 from CHF 258.5 million at year-end 2017. At market values, equity rose from CHF 272.2 million as of 31 December 2017 to CHF 328.4 million. This represents an equity ratio of 45.9 percent after 41.6 percent at the end of 2017. Based on market values, the equity ratio was 46.8 percent compared to 42.8 percent as of 31 December 2017. Due to the reduced proportion of development projects, total assets at the end of the first six months of 2018 rose by only 11 percent to CHF 689.6 million compared to year-end 2017. This also contributed to a higher equity ratio. As of the end of the first half of 2018, Peach Property Group had cash of CHF 91.6 million, up from CHF 49.2 million at the end of 2017.

Positive outlook for 2018

For the full year 2018, Peach Property Group expects a further significant increase in rental income driven by the integration of residential properties that have already been notarised and further progress with portfolio properties. The Group also wants to continue the steady expansion of its property portfolio, with the focus remaining on residential portfolios in German B-cities. In addition, the Group also expects further organic rental increases – among other things as a result of continued tenant-focused management and the opening of another flag ship store – “Peach Point” – in Heidenheim in the second half of 2018.

Dr. Thomas Wolfensberger, CEO of Peach Property Group, comments: “We are very pleased with the successful first half of 2018 that saw the further expansion of our portfolio and a considerable increase in profits. This growth makes us more attractive for institutional investors – a development that we feel very positive about. We are also optimistic for the future performance of our Company. With cash on hand of more than CHF 90 million and given our staffing levels, we are well equipped both in terms of funds and personnel to achieve further dynamic growth. We therefore reaffirm our medium-term target of having 11,000 apartments in our portfolio.”

The detailed 2018 half-yearly report is available (in German) on the Peach Property Group’s website: http://peachproperty.com

Contacts:

Media, investors and analysts

Dr. Thomas Wolfensberger, Chief Executive Officer and Dr. Marcel Kucher, Chief Financial Officer
+41 44 485 50 00 | investors@peachproperty.com

Media Germany
edicto GmbH, Axel Mühlhaus, Peggy Kropmanns
+49 69 90 55 05 52 | amuehlhaus@edicto.de

About Peach Property Group AG

Peach Property Group is a property investor and developer focused on investments in Germany and Switzerland. The Group stands for long time experience, competence and quality. Innovative solutions for modern housing needs, strong partnerships and a wide value chain complete the profile of the Group. The portfolio consists of an increasing number of high yield investment properties, typically in B-cities in close reach to metropolitan areas. In addition, the Group develops properties for its own portfolio or for the sale as condominium. Developments for sale focus on A-locations and encompass attractive architecture and high level furnishing for an international clientele. The business activities of the Group cover the entire value chain, from property acquisition and site selection to active asset management and finally to the sale or lease of properties.

Peach Property Group AG is headquartered in Zurich and has its German Group headquarters in Cologne. Peach Property Group AG is listed on the SIX Swiss Exchange (PEAN, ISIN CH0118530366). Its Board of Directors consists of Reto Garzetti (President), Peter Bodmer, Dr. Christian De Prati and Kurt Hardt.

For more information, see http://peachproperty.com