The start of construction of six new projects - including a multifunctional project Fuzja in Łódź, closing of the sale of Gatehouse Offices in Warsaw Brewery, the sale of 351 apartments, the purchase of land for over 75,000 sqm of residential and office space - this is an overview of Echo Investment's operations in the first quarter of 2019. The net profit generated at that time amounted to nearly PLN 32 million.
The value of residential and retail projects under construction increased in the first quarter by 13%, what is clearly in line with the strategy of profitable growth. The net profit was attributable primarily to the increase in the value of projects under construction. The result was also driven by apartments handed over to clients, rents received from the lease of office space in O3 Business Campus III in Krakow and Gatehouse Offices in the Warsaw Brewery complex, as well as rents from in Libero in Katowice. The value of the Group’s assets amounted to nearly PLN 4.4 bn as at 31 March, 2019.
‘We maintain very stable financial standing and low net debt ratio that amounted to 25% as at 31 March 2019. We are also happy about the trust of financial institutions, that from the beginning of the year granted investment loans for construction of two office projects, and also invested in our bonds worth PLN 100 mln. The Group maintains a high level of cash - PLN 471 mln at the end of the first quarter. We also continue to improve the structure of our debt so that our financial flows are strong and stable in the long term’ adds Maciej Drozd, CFO of Echo Investment.
Echo Investment is focused on developing multifunctional, ‘destination’ complex projects, new parts of cities attracting people to live in, work and spend their free time. Today such projects cover nearly half of the company’s development pipeline.
‘All buildings of our flagship Warsaw Brewery project are at various stages of construction works or are completed. I assure you that by the second half of 2020 this entire quarter, including streets, open squares, greenery and public spaces, will be finished and returned to Warsaw and its residents. In the first quarter, we started construction of Fuzja - our multifunctional project at Tymienieckiego str. in Łódź. In March, at the MIPIM real estate fair in Cannes, we presented our idea for another, significant part of Warsaw - the Towarowa 22 project. We are working on it together with the world-famous architecture firm BIG Architects’ says Nicklas Lindberg, Echo Investment’s CEO.
The residential offer of the company is gradually growing. The sales are at a good level, slightly higher than sales recorded in the first quarter of 2018. The number of 351 apartments sold puts Echo Investment in sixth place among residential developers listed on the Polish stock exchange.
‘We still have an appetite for increasing our market share to be in line with our target of 2,000 units sold by 2020 as communicated earlier. During the first three months of the year, we started construction of 542 apartments in Poznań and Łódź, and by the end of the year we will put on offer about 1,700 units. We intend to sell about 1,300 units throughout the year and hand over approximately 1,250 apartments to our clients’ adds Nicklas Lindberg.
Since the beginning of the year, the company has started construction of React office buildings in Łódź and Moje Miejsce II in Warsaw, that together will have around 32,000 sqm of lease area, and prepares to start projects in Wrocław and Gdańsk by the end of the year. The area of office projects started in 2019 will amount to 100,000 sqm in total. The office market is very attractive for international investors, as shown by transactions concluded. This is supported, among others by the sale in March of Gatehouse Offices, the first office building of the Warsaw Brewery complex for EUR 76.5 mln. O3 Business Campus III in Krakow is also under agreement to be sold this year.
A week ago Echo Investment with its partner EPP celebrated the grand opening of Galeria Młociny in Warsaw. Only for the first four days, it was visited by over 220,000 clients.
- It is leased by great retail brands that have prepared refreshed or completely new concepts of their stores. A magnet for clients is the restaurant and entertainment zone, that occupies about 6,000 sqm of space on the top floor. We believe that Galeria Młociny will become a place where residents of Bielany will spend their time, as well as a significant part of 24 million passengers of the Młociny transport hub’ says Nicklas Lindberg.