2023 result up for Covivio

Its benchmark indicator, recurring net profit, increased by 1,2% to 435,4 million euros, while the company was expecting 420 million.

On the other hand, it experienced a net loss of 1,42 billion euros, but this indicator is not very representative of the performance of a real estate company, whose economic model consists of renting buildings which it owns.

This loss is explained by the drop in value of its real estate assets, under the effect of the increase in interest rates.

Covivio will offer its shareholders a dividend of 3,30 euros per share, lower than in 2023 (3,75 euros), with the group wishing to free up cash to reduce debt and finance possible acquisitions.

To this end, its disposal plan is progressing faster than expected, the company having already shed 920 million euros of assets out of the billion and a half planned by the end of 2024.

This allows it to reduce its net debt, which rose to 6,93 billion euros compared to 7,58 billion at the end of 2022, and to continue the refocusing of its activities on major metropolises (Paris, Berlin, Milan, etc.) and in developing its hotel business rather than office real estate.

Offices represent half of its revenues, a share which is gradually decreasing, while that of its housing stock in Germany and especially its hotels across Europe is increasing.

“Our strategy is to gradually rebalance our portfolio between our three asset classes: offices, residential and hotels,” the group's general director, Christophe Kullmann, explained to AFP.

Covivio is in negotiations with AccorInvest, former real estate division of Accor, to divide up a portfolio of jointly held hotels.

For 2024, the company forecasts further growth in recurring net profit, to 440 million, driven by the increase in office rents in the most popular locations, that of housing in Germany, and the impact on hotels from the Paris Olympic Games and Euro football in Germany.

“There is a fundamental dynamic which is the attraction of large European metropolises on tourism, which cannot be denied,” added Christophe Kullmann.