Direkteinstieg
annual report 2007
Successful start for Commerz Real AG The integration process was initiated in early summer 2007, when project teams focusing on specific topics started devising action plans; this was followed by the definition of structural organisation and workflows during the second half of the year. The process was supported by information events and integration workshops for more than 800 staff at Commerz Real’s two main office locations in Dusseldorf and Wiesbaden. This targeted approach made it possible to successfully conclude the key parts of the integration programme by the end of 2007.
Growth in new business, with rising profits Commerz Real generated just under EUR 7.2 billion in new business in 2007, nearly doubling the aggregate volumes originated by its two predecessor companies (EUR 3.7 billion). Investment Products accounted for EUR 4.0 billion, followed by Structured Investments, with EUR 1.7 billion in new contracts, and Equipment Leasing, where EUR 1.5 billion in new business was booked. Profitability also clearly improved in 2007: at EUR 140 million, profit before taxes outperformed the aggregate results of the predecessor entities (EUR 98.3 million) by more than 40 per cent. The increase was predominantly due to the strong growth in assets under management, backed up by significant improvements in business origination. In addition, the reversal of provisions yielded EUR 25.8 million in extraordinary income.
Strong performance of open-ended real estate funds – new markets explored Commerz Real’s family of hausInvest funds posted a net EUR 1.7 billion inflow of funds during the year under review. Real estate investments totalled approximately EUR 1.5 billion. Assets managed by the hausInvest funds amounted to an aggregate EUR 11.4 billion at the reporting date of 31 December 2007, servicing more than 500,000 investors. The hausInvest europa fund held 82.3 per cent international real estate, whilst the share for the hausInvest global fund, which invests in Europe, North America, and Asia, was 96.4 per cent. Both funds showed a positive performance, thanks to higher rental income and the appreciation of real estate assets held: based on calculations in accordance with the methodology defined by BVI, the German Investment Management Association, the hausInvest europa fund posted an annual performance of 7.4 per cent (2006: 3.8 per cent), and hausInvest Global recorded 5.6 per cent (2006: 5.0 per cent). The hausInvest global fund, which was launched in 2003, acquired properties in South Korea and Singapore for the first time in 2007, having invested in Japan since 2006. Commerz Real’s special real estate funds under German investment law also succeeded in boosting their business volumes during 2007. The company manages six institutional funds with an aggregate volume of EUR 1.7 billion. All funds recorded a positive performance
Successful placement of closed-end funds Business volumes in closed-end funds also increased: total equity invested rose to EUR 4.6 billion in 2007, placed across 165 funds with an aggregate investment volume in excess of EUR 11.6 billion. More than 62,000 investors have subscribed to around 115,000 investments [to date]. Placements in 2007 included the USD 516 million CFB Fund 160 “Comcast Center”, which invests in Philadelphia, USA, and CFB Funds 161-163, three ship funds with an aggregate volume of around USD 226 million. The placement phase has started for CFB Fund 164 “Asia Opportunity I”, a fund with a total investment volume of around USD 273 million, which allows investors to participate in an institutional portfolio of Asian assets managed by LaSalle Investment Management; and for CFB Fund 165 “Euro Alsace Paris” with an investment volume of EUR 160 million. Response for both funds has been very promising. Thanks to the early sale of ship fleets for CFB Funds 139 and 146, investors received returns of 210 and 185 per cent respectively, on their invested capital after a short investment period. Once again, Commerz Real invested more than 2 billion US dollars to acquire ships which will be used to back closed-end funds over the next two years. Looking ahead, Commerz Real will also focus on real estate as its core segment, and on developing renewable energy funds.
Structured Investments developing innovative financing solutions The Structured Investments business line focused on balance sheet structure management for commercial enterprises, as well as on the public sector within the scope of PPP projects. Business in this segment expanded further during 2007: this was highlighted by the signing of agreements with several health insurance funds, granting rights of use for around 70 properties worth EUR 400 million. During the year under review, Commerz Real signed an agreement jointly with Tishman Speyer for the construction of a new high-rise building in the ‘Kaiserkarree’ development in Frankfurt’s banking district, plus an agreement for the construction and lease of Premiere AG’s new group headquarters in Unterföhring, just outside Munich. Commerz Real also closed a EUR 75 million structured financing package for the purchase of eight regional jets by US airlines. In its PPP business, Commerz Real also actively participates in public tender processes for complex investment projects. A key example is the ‘Elbphilharmonie', the new concert hall built on behalf of the City of Hamburg within the scope of a EUR 241 million PPP project. Shell construction for the new building has already started, with completion scheduled for 2010.
Strong growth in Equipment Leasing Benefiting from the benign investment climate, Commerz Real has boosted its new equipment leasing business volume by more than 30 per cent compared to the previous year. Continuing to outperform market growth for several years now, Commerz Real actively enhanced its cooperation with Commerzbank’s corporate client business and strengthened its external sales network to realise this positive result. In the international business, BRE Leasing once again made a strong contribution to new business origination, having affirmed its position as one of the three leading providers of leasing products in Poland. The key objective in Equipment Leasing is to continue boosting new business volumes by strengthening Commerz Real’s sales force, in line with a further intensified sales cooperation with Commerzbank. Looking ahead for 2008, Commerz Real will maintain its growth momentum by extending its product range and asset coverage in its existing business lines, growing its international profile through exploring new markets, and expanding its investor baseDusseldorf, March 2008 Copyright © Commerz Real AG, 2008 |
