Covivio, has announced its 2023 annual results, showcasing its operational performances and strategic initiatives.

Key achievements and outlook for 2024:

Operational Performance Highlights:

Hotels: Covivio's hotel segment demonstrated an operational performance, with RevPAR in Europe up by 16% compared to 2019, driven by a 23% increase in ADR. Moreover, negotiations with AccorInvest aim to consolidate hotel properties and business assets.

Offices: The company experienced significant leasing activity with almost 131,000 m² let or renewed, resulting in an increased occupancy rate of 94.5%.

Residential: Covivio saw an accelerated rental reversion of +21%, with notable growth in Berlin at +31%, indicating resilience and growth in the residential segment.

Like-for-like revenues grew by +6.4%, contributing to consolidated revenues of €1 billion (€648 million Group share), representing a +2.4% increase on a reported basis and +6.4% like-for-like.

In a real estate market impacted by rising interest rates, Covivio has adapted quickly, notably through €720 million in new disposal agreements. Meanwhile, recurring net income rose, driven by asset management transactions and a +6.4% increase in like-for-like revenues. In 2024, we will maintain our financial discipline while pursuing growth in recurring results.- CHRISTOPHE KULLMANN, CHIEF EXECUTIVE OFFICER, COVIVIO

Financial Strength and Balance Sheet:

Covivio maintained financial discipline, achieving almost €700 million in net debt reduction and doubling liquidity to €2.4 billion, covering debt expiries until Q1 2026. Despite a -10% decline in like-for-like values, the Loan to Value (LTV) ratio remained under control at 40.8%. Recurring net income increased by +1% in 2023, reaching €435 million (€4.47 per share), exceeding initial guidance.

ESG Strategy: Significant progress in ESG indicators, with 95.3% of the portfolio certified, and an increase in debt linked to ESG objectives to 57%.

Strategic Initiatives and Outlook:

Covivio established a partnership with AccorInvest for a value-creating swap to consolidate OpCos and PropCos, potentially optimizing hotel asset performance. The company aims to maintain financial discipline, with a €580 million disposal target and a proposed dividend of €3.30 per share for 2023, with an option for payment in shares. 2024 recurring net income guidance is around €440 million, with a focus on deleveraging and returning to a full cash dividend with a payout ratio above 80%. Overall, Covivio's operational performance and strategic initiatives position the company for continued growth and value creation in the real estate market.