L
ETNA
45
(K
OSICE
,
S
LOVAKIA
)
P
ALMOVKA
(P
RAGUE
,
C
ZECHIA
)
S
OLD IN
D
ECEMBER
2025
S
OLD IN
M
AY
2025
ARCONA PROPERTY FUND N.V.
ANNUAL REPORT 2025
2
CONTENTS
1
ARCONA
PROPERTY
FUND
N.V
.................................................................................
6
2
FOREWORD
FROM
THE
MANAGING
BOARD
.............................................................
8
3
ARCONA
PROPERTY
FUND
IN
BRIEF
........................................................................
9
4
REPORT
OF
THE
SUPERVISORY
BOARD
................................................................
11
5
REPORT
OF
THE
MANAGING
BOARD
......................................................................
12
5.1
YEAR IN REVIEW
...............................................................................................................
12
5.2
REAL ESTATE PORTFOLIO DEVELOPMENT
......................................................................
14
5.3
FINANCIAL PERFORMANCE REVIEW
.................................................................................
17
5.4
ECONOMIC BACKGROUND
................................................................................................
25
5.5
FUND STRATEGY AND OUTLOOK
......................................................................................
33
5.6
RISK MANAGEMENT AND GOVERNANCE
..........................................................................
35
5.7
STATEMENT REGARDING ADMINISTRATIVE ORGANISATION AND INTERNAL CONTROL . 38
6
THE
REAL
ESTATE
PORTFOLIO
..............................................................................
39
6.1
POLAND
............................................................................................................................
39
6.2
CZECHIA
...........................................................................................................................
44
6.3
ROMANIA
...........................................................................................................................
45
6.4
UKRAINE
...........................................................................................................................
46
7
PERFORMANCE
INDICATORS
.................................................................................
48
FINANCIAL
STATEMENTS
.......................................................................................................................
55
CONSOLIDATED
FINANCIAL
STATEMENTS
2025
...................................................
59
PARENT
COMPANY
FINANCIAL
STATEMENTS
2025
..............................................
166
20
OTHER
INFORMATION
............................................................................................
191
3
KEY
FIGURES
The main development reflected in these key figures is the continued monetisation and downsizing of the
Fund’s portfolio in line with the strategy supported by shareholders. In this respect, several Alternative
Performance Measures (APMs) are used as performance indicators, as specified in Section 7 ‘Performance
Indicators’. The Ongoing Charges Figure (OCF) is specified in Section 15.38 ‘Ongoing Charges Figure’,
and the Loan-to-Value (LTV) ratio is presented in Table 16, which forms part of Section 5.3 ‘Financial
Performance Review’. Compared with the previous year, portfolio size, rental income and NNNAV per share
declined, mainly driven by the sale of several assets during the year as part of the portfolio monetisation
programme. This resulted in a smaller portfolio and lower earnings, while reducing financial exposure and
supporting the objective of narrowing the discount between the share price and the Fund’s NNNAV.
REVENUES AND EARNINGS
2025
2024
Change
Gross rental and service charge income (in EUR 1,000)
7,390
8,829
-/- 1,439
Net rental and related income (in EUR 1,000)
3,274
4,412
-/- 1,138
Direct result before tax (in EUR 1,000)
1
582
807
-/- 225
Indirect result before tax (in EUR 1,000)
2
-/- 5,415
-/- 827
-/- 4,588
Total result before tax (in EUR 1,000)
-/- 4,833
-/- 20
-/- 4,813
Tax (in EUR 1,000)
-/- 488
12
-/- 500
Total result after tax (in EUR 1,000)
-/- 4,345
-/- 32
-/- 4,313
Earnings per share (in EUR) (see 15.40.1)
-/- 1.10
-/- 0.01
-/- 1.09
Diluted adjusted earnings per share (in EUR)
-/- 0.11
0.06
-/- 0.17
Ongoing Charges Figure
3
(
OCF
) (without non-regular costs) (%)
8.63
8.01
0.62
BALANCE SHEET
31-12-2025
31-12 2024
Change
Investment property, investment property under development
and investments in associates (in EUR 1,000)
46,666
49,438
-/- 2,772
Assets held for sale (in EUR 1,000) (see 15.12)
4,315
19,580
-/- 15,265
Equity
(in EUR 1,000)
38,777
42,476
-/- 3,699
NNNAV per share (in EUR)
9.66
10.71
-/- 1.05
Loan-to-Value (LTV)
4
(%)
33.3
33.4
-/- 0.1
Weighted avg. number of shares outstanding (see 15.40.3)
5
3,962,436
4,116,009
-/- 153,573
KEY PORTFOLIO METRICS
31-12-2025
31-12-2024
Change
Number of properties
16
19
-/- 3
Value of assets (in EUR million)
6
51.0
69.0
-/- 18.0
Net rental and related income (in EUR million)
4.12
4.41
-/- 0.29
Lettable area (in sqm)
32,693
47,687
-/- 14,994
Weighted average occupancy (in %)
82.09
85.87
-/- 3.78
Weighted remaining maturity of loans/ borrowings (years)
7
2.32
3.75
-/- 1.43
1
The difference between the Total result before tax and the Indirect result before tax.
2
The net results on properties (see 15.30 Net result on properties).
3
For further detail on the calculation of OCF, see 15.38 ‘Ongoing Charges Figure’
4
For further detail on the calculation of LTV, see table 16
5
The 2024 amount is still before the cancellation of 294,118 shares as repurchased during the tender offer.
6
The value of the investment property, investment property under development, investments in associates and the assets
held for sale
7
See 15.41.15 ‘Liquidity risk’.
4
BALANCE SHEET STATEMENT
(in EUR 1,000)
2025
2024
2023
2022
2021
Investment properties, Investment
property under development and
investments in associates
46,666
49,438
72,656
73,183
79,973
Other non-current assets
282
1,076
995
1,454
1,259
Current assets
17,458
23,081
10,021
15,582
9,334
Total assets
64,406
73,595
83,672
90,219
90,566
Shareholders' equity
38,777
42,476
45,396
46,515
46,403
Deferred tax liabilities
441
2,647
3,426
3,183
3,514
Other non-current liabilities
3,108
17,217
7,334
17,597
30,597
Current liabilities
22,080
11,255
27,516
22,924
10,052
Total equity and liabilities
64,406
73,595
83,672
90,219
90,566
PROFIT AND LOSS STATEMENT
(in EUR 1,000)
2025
2024
2023
2022
2021
Direct result before tax
582
807
201
637
1,076
Indirect result before tax
-/- 5,415
-/- 827
779
-/- 4,577
1,949
Total result before tax
-/- 4,833
-/- 20
980
-/- 3,940
3,025
Income tax expense
-/- 488
12
797
410
-/- 109
Total result after tax
-/- 4,345
-/- 32
183
-/- 4,350
3,134
ISSUED CAPITAL
2025
2024
2023
2022
2021
Outstanding shares (ultimo)
3,962,436
4,177,083
4,177,083
4,185,984
3,758,683
Basic earnings p.s. (in EUR)
-/- 1.10
-/- 0.01
0.04
-/- 1.07
0.83
Diluted adj. earnings p.s. (in EUR)
8
-/- 0.11
0.06
-/- 0.19
-/- 0.05
0.02
DATA PER SHARE
2025
2024
2023
2022
2021
(Interim-) dividend (in EUR)
n.a.
n.a.
0.18
n.a.
n.a.
NNNAV
9
(in EUR)
9.66
10.71
10.93
11.81
12.76
Avg. monthly turnover
32,565
98,239
101,307
227,468
269,291
Highest share price (in EUR)
7.00
6.94
6.00
7.49
7.60
Lowest share price (in EUR)
5.37
4.57
3.80
4.61
3.40
Ultimo share price (in EUR)
6.68
6.05
5.00
5.90
7.50
The negative result was mainly driven by valuation movements and the sale of Letná 45 in Košice at a price
significantly below its latest valuation, reflecting its higher risk profile and limited liquidity in the local market.
8
As earnings is used to measure the operational performance, it is the income return generated by the investment, rather
than the change in value or capital return on investments (see chapter 7 ‘performance indicators’).
9
See 7.1.11 ‘Calculation of NNNAV after issuance of shares (share-based payments)’
5
REAL ESTATE PORTFOLIO AT A GLANCE
The results for the year were significantly influenced by the continued execution of the Fund’s portfolio
monetisation programme. During 2025 the Fund completed several disposals, reducing the portfolio size
from EUR 68.0 million to EUR 49.9 million and the number of assets from 19 to 16.
Disposals were executed in line with the strategic objective of monetising part of the portfolio. Whilst the
Palmovka sale was completed well in excess of valuation, the Letna 45 sale was completed below the most
recent external valuation due to market liquidity conditions, transaction timing and limited buyer demand.
These outcomes should therefore be viewed in the context of the Fund’s deliberate portfolio reduction
strategy rather than as a reflection of the operational performance of the underlying assets.
Real estate portfolio monetisation progress
Table 1 – Asset allocation by region
Fair value 2025
Fair Value 2024
Delta
EUR m
%
EUR m
%
EUR m
%
Comment
Poland
32.0
64.2
33.8
49.7
-/- 1.8
14.5
Bydgoszcz asset ‘sold’
Slovakia
-
-
11.9
17.6
-/- 11.9
-/- 17.6
Letna 45 sold
Czechia
7.4
14.8
11.0
16.2
-/- 3.6
-/- 1.4
Palmovka sold
Romania
7.2
14.4
7.8
11.5
-/- 0.6
2.9
Ukraine
3.3
6.6
3.4
5.0
-/- 0.1
1.6
Total
49.9
67.9
-/- 18.0
Table 2 – Sectoral breakdown
Fair value 2025
Fair Value 2024
Delta
EUR m
# assets
EUR m
# assets
EUR m
# assets
Offices
23.8
4
40.2
6
-/- 16.4
-/- 2
Retail centres
22.8
9
24.4
10
-/- 1.6
-/- 1
Land plots
3.3
3
3.4
3
-/- 0.1
0
Total
49.9
16
68.0
19
-/- 18.1
-/- 3
6
1
ARCONA
PROPERTY
FUND
N.V.
Incorporation
Arcona Property Fund N.V. (the
Fund
) is an investment company with variable capital within the meaning
of article 76a of Book 2 of the Dutch Civil Code. The Fund was incorporated on 27 November 2002 by a
notarial deed executed before Prof. D.F.M.M. Zaman, civil-law notary in Rotterdam.
Registered Office and entry in Trade Register
The Fund is registered in Amsterdam and is entered in the Trade Register of the Chamber of Commerce
under number 08110094.
Office Address
De Entree 55 – floor 11
NL 1101 BH AMSTERDAM
The Netherlands
Tel: +31(0)20 82 04 720
E-Mail: info@arconacapital.com
Website: www.arconapropertyfund.com
Supervisory Board
The Supervisory Board of the Fund comprises:
Mr. drs. A.N. Krol (chairperson)
M.P. Beys Esq (till 26 June 2025)
Dr. J.J. van Heijst (till 26 June 2025)
Mr. E.J.C.G. Korteweg (from 4 December 2025)
Mr. E. van Erkelens (from 4 December 2025)
The members of the Supervisory Board have chosen domicile at the offices of the Fund.
Mrs. A.N. Krol, born in 1966 (Rotterdam), holds a degree in Business Economics and Dutch Law from
Erasmus University. She has an extensive background in corporate law, including corporate governance
issues, as well as capital market transactions, such as IPOs, and regulatory issues like market abuse. Mrs.
Krol has also provided financial reporting advice on the application of Dutch GAAP and EU IFRS,
demonstrating her expertise in the field. With years of experience in advising on complex legal and financial
transactions, she has held senior positions at Loyens & Loeff N.V. Mrs. Krol is a member of the Supervisory
Board of the Dutch Vodafone Holding companies since September 2019 and was appointed to the
Supervisory Board on June 22, 2022, where she will serve a term ending on June 21, 2026.
Mr. E.J.C.G. Korteweg, born in 1968, holds an RICS Postgraduate Diploma in Property Investment from
the College of Estate Management at Reading University (UK) and has a long-standing international career
in real estate. His expertise includes acquisition strategy, transaction management, residential
development, and asset and portfolio management across the Netherlands and Central Europe. He
currently serves as Partner at Growe NL B.V. and previously held senior roles at Life Europe/Redevco,
Lister Buildings, and Greystar Netherlands, where he co-founded the Dutch organization and worked on
the OurDomain portfolio. Earlier positions include roles at Peak Development, Primavera Development, ING
Real Estate Development, Rodamco Continental Europe (Unibail), and DTZ Poland. Mr. Korteweg has been
a member of the Supervisory Board since December 4, 2025, with a term ending on December 3, 2029.
Mr. E. van Erkelens, born in 1965, holds SPD-I and SPD-II accounting qualifications and has extensive
experience in real estate management, corporate governance, and financial management within listed
structures. He is currently Managing Director of Equity Estate Holding B.V. and Equity Estate Asset
Management B.V. Previously, he served with Züblin Immobilien Holding AG and as Managing Director of
European City Estates N.V., Sarakreek Holding N.V., and Capa City Realty N.V. He also held several
directorships, including Catella Property Consultants B.V., Burggolf Investments B.V., and Hampshire
Hotels, and served as Treasurer of the Ronald McDonald House (AMC). Mr. van Erkelens has been a
member of the Supervisory Board since December 4, 2025, with a term ending on December 3, 2029.
7
Managing Board
The Fund is managed by Arcona Capital Fund Management B.V. (
ACFM
or the
Managing Board
). ACFM
is based in Amsterdam and registered in the Trade Register of the Chamber of Commerce under number
08107686.
The Managing Board currently has the following directors:
G.St.J. Barker LLB
P.H.J. Mars M.Sc.
M. van der Laan B.Sc
M.T.H. Blokland BBA
The Managing Board has chosen domicile at the offices of the Fund. More information can be found on
the website: www.arconapropertyfund.com
Stichting Prioriteit
Stichting Prioriteit (the
Foundation
) of the Fund is managed by a managing board consisting of two
members:
G.St.J. Barker LLB
P.H.J. Mars M.Sc
Auditors
Deloitte Accountants B.V.
Gustav Mahlerlaan 2970
NL 1081 LA Amsterdam
The Netherlands
Legal Advisor
Loyens & Loeff N.V.
Blaak 31
NL 3011 GA Rotterdam
The Netherlands
Listing Agent
ABN AMRO Bank N.V
Gustav Mahlerlaan 10
NL 1082 PP Amsterdam
The Netherlands
Administrator
Moore MKW Accountants B.V.
Colosseum 1
NL 7500 AC Enschede
The Netherlands
Depositary
CSC Depositary B.V.
Woudenbergseweg 11
NL 3953 ME Maarsbergen
The Netherlands
Identification codes
The ISIN code is NL0006311706
The REUTERS code is ARCPF
The BLOOMBERG code is ARCPF:NA
The Managing Board holds a license to manage Investment Institutions as defined by Section 2:65 Wft (Act
on the Supervision of Investment Institutions, Wet op het financieel toezicht).
8
2
FOREWORD
FROM
THE
MANAGING
BOARD
During 2025, the Fund continued the execution of its portfolio monetisation strategy in a gradually
stabilising, yet still complex Central European real estate market. While macroeconomic conditions
improved compared to prior years, operational and valuation pressures persisted.
The main developments affecting NAV, cash position and risk profile during 2025 were driven by a
combination of disposals, operational events and valuation movements. The sale of the Palmovka Point
office asset in Prague, completed above the December 2024 valuation, demonstrated the Fund’s ability to
realise value under favourable market conditions while enhancing liquidity. In contrast, the disposal of Letná
45 in Košice, the Fund’s largest office asset, generated substantial cash proceeds and significantly reduced
concentration risk, but resulted in a negative NAV impact due to execution below valuation.
Operational performance was affected by the vacancy at EOS Business Park in Romania following the
departure of Danone, which led to downward pressure on both portfolio occupancy levels and valuations.
At the same time, the broader disposal programme progressed, with several assets previously classified
as held for sale being divested during the year. This resulted in a materially smaller portfolio, improved
liquidity and enabled further debt reduction. In addition, the acquisition of the Kyiv development site
completed the SPDI transaction programme and added long-term development potential.
As a result of these developments, the portfolio value decreased to EUR 50.98 million. Net rental income
declined to EUR 3.27 million, due to the reduced portfolio size, while the performance of the remaining
assets remained broadly stable on a like-for-like basis.
The Fund reported a negative result for the year, largely driven by valuation movements and disposal
outcomes, specifically the impact of the Letná 45 transaction. Triple Net Asset Value per share decreased
to EUR 9.66, representing a decline of 9.8% compared to the previous year. However, the Fund´s share
price remained broadly stable over the year.
Despite these outcomes, the Fund’s financial position strengthened. Disposal proceeds were primarily used
to reduce debt and improve liquidity, resulting in a stable loan-to-value ratio and a significant increase in
solvency. While the debt maturity profile temporarily shifted towards short-term liabilities at year-end due
to refinancing timing, this was successfully addressed after the reporting period through the refinancing of
the Hypo NOE facility and the full repayment of the Patria Bank loan, materially improving the Fund’s
financing structure.
Looking ahead, the Fund will continue to execute its strategy of selective disposals and active asset
management, with the medium-term objective of returning substantial funds to shareholders. The improving
interest rate environment and increased transaction activity in the CEE region was expected to provide a
more supportive backdrop for portfolio optimization during 2026, but recent geopolitical and macroeconomic
developments resulting from conflict in the Middle East require continued prudence and flexibility in
decision-making.
9
3
ARCONA
PROPERTY
FUND
IN
BRIEF
General
The Fund is an investment company with variable capital incorporated under Dutch law and registered in
Amsterdam. The shares have been listed on Euronext Amsterdam since 2003. The Fund invests in
commercial real estate in Central and Eastern Europe (the
CEE
).
The Fund offers several important features that distinguish it from other real estate funds:
•
The focus on Central and Eastern Europe;
•
Local representation of Arcona Capital with its own offices in Amsterdam (Netherlands), Munich
(Germany), Prague (Czechia), Sofia (Bulgaria) and Warsaw (Poland);
•
Access to regional property management knowledge and facilities;
•
Long-term management experience in Central Europe (since 1992).
Managing Board
Arcona Capital Fund Management B.V. is the managing board of the Fund. On 24 January 2006, it obtained
from the AFM a permit under the Wft.
Fund Structure and tradability
The Fund is a closed-end investment institution with shares listed on Euronext Amsterdam and the PSE.
Strategy
The Fund is one of a limited number of listed and regulated property vehicles active in the CEE region,
providing regional market exposure for both private and institutional investors. It aims to provide capital
preservation and a high dividend yield through a diversified and liquid vehicle managed by property
specialists with a fiduciary mind-set. This is a key differentiation from the other listed stocks in the region,
which are either very sector-specific or are primarily development-focused with a higher risk profile.
The costs of maintaining such a structure, offering daily trading in the shares, are high and impact
disproportionally on smaller funds.
Continued strong focus on operations
The Fund kept operational cost ratios (see 15.38 ‘Ongoing charges figure’) and occupancy levels in the
existing portfolio relatively stable. The Fund will continue to identify and realise opportunities to add value
to the existing portfolio through redevelopment and refurbishment, with the aim of enhancing the liquidity
and saleability of the assets.
Portfolio management through selective investments and disposals in core markets
Going forward, the Fund has a clear strategy for its core markets, focusing on regional sectors with above-
average growth potential and limited international competition. The Fund will continue to dispose of assets
that are not aligned with its strategic focus if favourable opportunities for completing such disposals arise.
Maintaining a prudent financial strategy
The Fund intends to maintain its prudent financial strategy of conservative leverage, targeting a LTV-ratio
in the range of 40% - 50% (as at 31 December 2025: 33.3%), although an LTV percentage of up to 60% is
possible. The Managing Board has need for flexibility, in particular the ability to sell real estate from the
portfolio without incurring high debt finance breakage costs. The Fund prefers to use several different
financiers, so as not to be dependent on just one party.
Investor relations and information supply
The Fund strives to achieve open, timely and clear communication with private and institutional investors,
asset managers and other interested parties, and endeavours to configure its public and investor relations’
policy accordingly. Currently the Fund’s investors are largely private investors and asset/wealth managers.
Corporate Governance
Clarity and transparency in supervision and accounting is considered by the Fund to be the cornerstone of
good management and entrepreneurship. The Fund aims for a sound system of corporate governance, with
its strategy and investment objectives clearly defined and its operations effectively monitored by the
Managing Board, Supervisory Board and independent external parties.
10
Diversity
The Dutch Corporate Governance Code mandates a diversity policy for the managing and supervisory
boards of large public and private companies. Since the Fund is not classified as a large company, there is
no obligation to specify a diversity policy. Currently, the Managing Board comprises four members (one
female, three males), while the Supervisory Board consists of three members (one female, two males).
Shareholders appoint these members based on their experience, language skills, and qualifications. Should
the boards expand in the future, opportunities may arise for increased diversity in aspects such as age,
gender, and geographical experience.
The Fund's Managing Board is operated by ACFM. However, formally ACFM is not obligated by the Non-
Financial Information Disclosure Decree and the Diversity Policy Disclosure Decree to provide information
regarding its diversity policy.
Sustainability
The investments underlying this financial product do not take into account the EU criteria for environmentally
sustainable economic activities.
Social commitments
The Fund employs no staff directly and does not currently engage in, or provide funding for, social or
community engagement activities across the markets where it is active.
However, the Fund Manager, Arcona Capital, does fund a variety of community and cultural activities
across the markets in which the Fund is active. This includes sponsorship of the Czech Philharmonic
orchestra in Prague and financial support for the Sue Ryder Foundation (support for elderly people) and for
the 1st Prague Scout Group.
ESG Considerations in Financing and Refinancing
The Fund is currently not subject to the Corporate Sustainability Reporting Directive (CSRD). Nevertheless,
the Fund voluntarily provides certain ESG-related disclosures where deemed relevant.
The Fund does not currently perceive significant risks concerning ESG in relation with bank refinancing of
expiring loans in 2026 and beyond. However, this situation may change in the future if banks implement
more stringent ESG standards.
11
4
REPORT
OF
THE
SUPERVISORY
BOARD
Recommendation to the General Meeting
This annual report of the Fund has been prepared by the Managing Board. This report contains the financial
statements for the period from 1 January to 31 December 2025. The financial statements are audited and
have been approved by Deloitte Accountants B.V. The auditor’s report is presented on pages 193 – 204.
The Supervisory Board has received notice of this approval.
On 2 April 2026, the auditors of Deloitte presented their draft report summarizing the key findings of their
audit of the consolidated and company financial statements of Arcona Property Fund N.V. for the financial
year ended 31 December 2025. They discussed their audit approach, the most important matters
considered during the audit and the status of outstanding items still to be resolved before finalizing their
auditor’s opinion.
The Supervisory Board recommends the financial statements for the year 2025 to the General Meeting for
adoption.
Meetings and activities of the Supervisory Board
During 2025, the Supervisory Board and the Managing Board had regular contact in the form of monthly
calls to discuss the progress of asset sales pursuant to the sales and monetisation program established as
of 20 December 2023. In addition, the Supervisory Board and the Managing Board held six joint meetings,
in addition to the monthly sales updates (2024: six). During these meetings, the Supervisory Board and
Managing Board discussed (inter alia) the (administrative) organization, the operational performance,
compliance with bank covenants and financial reporting of the Fund.
Following the appointment of Mr. Enrico van Erkelens and Mr. Eelko Korteweg as supervisory directors
(replacing Messrs. Van Heijst and Beys) on 4 December 2025, the focus of the discussions shifted towards
the formulation of a monetisation strategy covering the entire portfolio.
In performing its duties, the Supervisory Board is guided by the interests of the Fund, taking into account
the interests of all stakeholders.
Composition of the Supervisory Board
In the period up to and including 25 June 2025, the Supervisory Board consisted of Mrs. Nelleke Krol
(chairperson), Mr. Beys (Chairman of the Board of Directors of SPDI owning [xx]% of the shares in the Fund
and qualifying as non-independent) and Mr. Van Heijst (representative of the Stichting Value Partners
Family Office and qualifying independent).
As of 4 December 2025, the Supervisory Board comprises three fully independent members with the right
experience and expertise to support the Managing Board in the formulation and execution of a monetisation
strategy covering the entire portfolio.
Relevant information of each of the Supervisory Board members can be found on page 6.
Finally
The Supervisory Board would like to express its appreciation for the efforts made during the financial year
by the Managing Board and staff.
Amsterdam, 30 April 2026
Supervisory Board
Mr. drs. A. Nelleke Krol (chairperson)
Mr. E.J.C.G. Korteweg (vice-chairperson)
Mr. E. van Erkelens
12
5
REPORT
OF
THE
MANAGING
BOARD
The Managing Board hereby presents the annual report of 2025 of the Fund. The reporting period is from
1 January 2025 to 31 December 2025.
5.1
YEAR IN REVIEW
In 2025, the Fund achieved milestones, including portfolio revaluations, loan refinancing and asset sales.
The following highlights outline the year
’
s major developments.
KEY HIGHLIGHTS OF 2025
The following events took place during the reporting period:
6 February 2025
| The Fund completes Kyiv development site acquisition
The Fund acquired a 0.54 hectare prime residential development site on Kyianovski Lane in central Kyiv
for a nominal consideration of USD 2 million, partly in cash and partly in shares issued at NAV. The
acquisition completed the multi-year SPDI purchase programme agreed in 2019, covering assets across
Bulgaria, Romania, and Ukraine.
4 March 2025
| The Fund completes end-2024 property valuations
External appraisals resulted in a EUR 0.79 million (-/- 1.2%) decline in the comparable portfolio value. The
decrease was mainly driven by a value drop of the EOS office building in Romania following the departure
of Danone. Czech office assets showed the strongest uplift, while Slovak and Romanian properties
declined.
26 March 2025
| The Fund renews AT&T lease at Letná 45 in Košice
The lease with AT&T was extended until April 2030, securing approximately 30% of the building’s
floorspace. Although the tenant reduced total leased area and obtained flexibility rights, the renegotiation
increased rental value per m² by roughly 16.5%, strengthening the long-term income profile of the Fund’s
largest asset at that time.
20 May 2025
| The Fund publishes Q1 2025 results and advances disposal strategy
The Fund reported a negative pre-tax result of EUR 171,000 due to one-off write-downs related to the
returned Bydgoszcz leasehold asset. Gross rental income rose slightly to EUR 1.43 million, financial
expenses decreased, and Triple NAV increased to EUR 10.76 per share. Assets held for sale rose sharply
to EUR 34.4 million, reflecting the active divestment programme and preparations for capital return
initiatives.
28 May 2025
| The Fund agrees sale of Palmovka Point office building above valuation
The Prague office asset Palmovka Point was sold for approximately EUR 5.48 million, around 28% above
its December 2024 valuation. The transaction highlighted management’s strategy of crystalising value at
favourable market moments and reflected redevelopment potential identified for the site.
26 June 2025
| Shareholders adopt AGM resolutions and governance updates
At the Annual General Meeting, shareholders approved the 2024 annual accounts, granted discharge to
the Management and Supervisory Boards, and adopted a capital reduction proposal. The proposed
reappointment of Mr. M.P. Beys was not approved, while Mr. J.J. van Heijst decided not to stand for
reappointment.
13
29 August 2025
| The Fund reports H1 results with improved solvency and ongoing divestments
The Fund reported a pre-tax result of EUR 280,000 and a profit after tax of EUR 40,000 for the first half of
2025. Rental income increased on a comparable basis, financing costs decreased, and Triple NAV rose to
EUR 10.79 per share while LTV improved to 32.1%. Occupancy declined following Danone’s departure
from EOS Business Park, and proceeds from asset sales were used to reduce debt and strengthen the
balance sheet.
22 October 2025
| The Fund proposes new Supervisory Board appointments and strategic review
The Fund announced an Extraordinary General Meeting to propose the appointment of Enrico van Erkelens
and Eelko Korteweg as supervisory board members. The governance reinforcement was positioned within
a broader intention aimed at presenting an updated strategic plan in early 2026.
20 November 2025
| The Fund publishes Q3 2025 results reflecting portfolio transition
For the first nine months of 2025 the Fund reported a net result of EUR 286,000, reflecting lower rental
income following asset sales and the EOS vacancy, as well as a provision linked to the Polish Bydgoszcz
lease expiry. NAV amounted to EUR 11.00 per share and Triple NAV reduced to EUR 10.29 mainly due to
a lower valuation of the Letná 45 asset after lease amendments with AT&T.
5 December 2025
| Shareholders approve appointment of new Supervisory Board members
At the Extraordinary General Meeting, shareholders appointed Enrico van Erkelens and Eelko Korteweg to
the Supervisory Board for four-year terms, resulting in a fully independent board intended to support the
Fund’s next strategic phase.
12 January 2026
| The Fund completes 2025 valuation and sells Letná 45 office building
Year-end 2025 valuations resulted in a 1.1% decline in comparable portfolio value
to EUR 49.9 million
10
, mainly driven by the EOS vacancy. The Slovak Letná 45 office
building was sold for EUR 8.2 million via an open CBRE-led process. While the
transaction generated significant free cash flow and reduced concentration risk, it
has a negative NAV impact of approximately 9.8% considering it was sold below
valuation.
Letná 45, Kosiče
EVENTS AFTER BALANCE SHEET DATE
23 March 2026
| The HYPO NOE loan was successfully refinanced
Subsequent to the reporting period, the Fund successfully refinanced the secured bank loan with Hypo
NOE, which had been classified as a current liability as at the Statement of Financial Position date due to
its contractual maturity on 31 March 2026. In March 2026, the Fund reached agreement with HYPO NOE
on the refinancing of this facility, resulting in a new loan with a long-term maturity term of five years
extending to March 2031. This refinancing strengthens the Fund’s financing structure, improves the maturity
profile of the Group’s debt, and provides increased long-term stability to the Fund’s capital structure.
April 2026
| The Patria Bank loan was fully repaid
Subsequent to the reporting period, the Fund fully repaid and settled the secured bank loan facility with
Patria Bank. The loan had been classified as a current liability following a breach of the bank covenants at
that date, mainly resulting from the EOS Business Park (Romania) becoming fully vacant during 2025. The
settlement of the loan reduces the Fund’s overall bank financing exposure and improves the Group’s
leverage position.
There were no further material events after balance sheet date.
10
Excluding Bydgoszcz asset
14
5.2
REAL ESTATE PORTFOLIO DEVELOPMENT
In 2025, the Fund’s real estate portfolio underwent significant changes through the sales related to the sales
programme. This section provides a comprehensive overview of the portfolio's development over the year,
detailing the changes in value, composition, income, and key performance indicators, while highlighting the
financial impact.
Table 3 – Comparative statement of the real estate portfolio
31-12-2025
31-12-2024
change
change
In EUR m
In EUR m
In EUR m
In %
Initial portfolio
69.02
78.85
-/- 9.83
-/- 12.5
Change: due to sales and other mutations
-/- 18.04
-/- 9.83
-/- 8.21
-/- 83.5
End portfolio value (in EUR 1,000):
50.98
69.02
-/- 18.04
-/- 26.1
Investment property (incl. under development)
43.12
46.04
-/- 2.92
-/- 6.3
Investments in associates
3.54
3.40
0.14
+ 4.1
Asset held for sale
11
4.32
19.58
-/- 15.26
-/- 77.9
Number of properties
16
19
-/- 3
-/- 15.8
The total real estate portfolio decreased to EUR 50.98 million as at 31 December 2025, compared with EUR
69.02 million at 31 December 2024, representing a decline of EUR 18.04 million (-/- 26.1%) compared with
a decrease of EUR 9.83 million in 2024, reflecting an acceleration of the portfolio disposal strategy. This
decrease is primarily the result of property disposals. The number of properties in the portfolio decreased
from 19 to 16 at year-end.
The balance of investments in associates increased slightly from EUR 3.40 million to EUR 3.54 million
(+4.1%), primarily due to valuation developments in the underlying associate investment, a 24.35% stake
in the Delenco office in Bucharest.
The value of assets held for sale decreased significantly from EUR 19.58 million to EUR 4.32 million
(-/- 77.9%), as several properties previously classified as held for sale were successfully disposed of during
the year and some of the assets have reverted to investment property due to IFRS regulation.
Table 4 – Statement of changes in owned investment property (see also 15.2.4)
All in EUR 1,000
2025
2024
Balance as of 1 January
44,765
66,622
Acquisitions
-
1,979
Purchases and additions
730
524
Exchange rate differences
35
-/- 300
Fair value adjustments
28
-/- 1,800
Reclassification (from “Assets held for sale”)
16,400
-
Reclassification (to “Assets held for sale”)
-/- 20,302
-/- 22,260
Balance as of 31 December
41,656
44,765
SALES AND RECLASSIFICATIONS
Property disposals were the primary driver of the portfolio reduction in 2025. Several assets were
successfully disposed of during the year, leading to overall contraction of the portfolio. The most notable
transactions included the sale of the Palmovka Point office asset in Prague and the disposal of the Letná
45 office building in Košice at the end of the year.
11
Including right-of-use assets held for sale
15
CAPEX AND REFURBISHMENTS
Capital expenditure during 2025 primarily related to targeted improvements and maintenance investments
within the remaining portfolio. These expenditures mainly focused on maintaining operational quality,
supporting tenant retention and ensuring the continued functionality of the properties. The exception was
at the Politickych veznu property in Prague, where an ambitious programme to convert the rear part of the
property from offices and storage to 16 modern apartments was commenced. This project has been funded
in its entirety by an expanded loan from Unicredit and is due for completion in early 2027. Negotiations are
currently underway with a corporate entity for the pre-lease of all 16 apartments.
OCCUPANCY AND LEASING
Leasing activity during the year was primarily focused on maintaining occupancy levels within the remaining
portfolio following the disposal of several assets. While the reduction in gross rental income reflects the
smaller portfolio size, the relatively limited decline in like-for-like rental income indicates that the occupancy
and leasing performance of the retained assets remained broadly stable.
At the same time, service charge recoveries increased within the comparable portfolio, indicating higher
tenant recoveries, mostly related to higher cost levels. However, this was accompanied by higher service
costs and operational expenses, which placed some pressure on operating margins. As a result, net rental
income from the continuing portfolio declined compared with the previous year, reflecting the combined
impact of slightly lower rental income and higher operating cost levels.
Table 5 – Statement of real estate income 2025 – 2024
2025
2024
Change
Change
in EUR 1,000
in EUR 1,000
in EUR 1,000
In %
Gross rental income
5,060
6,334
-/- 1.274
-/- 20.1
Service cost income
2,330
2,495
-/- 165
-/- 6.6
Total income
7,390
8,829
-/- 1,439
-/- 16.3
Service costs
-/- 2,425
-/- 2,610
+ 185
+ 7.1
Operational costs
-/- 1,691
-/- 1,807
+ 116
+ 6.4
Net rental income
3,274
4,412
-/- 1,138
-/- 25.8
Overall, real estate income declined in 2025, primarily reflecting the reduced size of the portfolio following
disposals.
16
Table 6 – Comparative statement
12
of real estate income 2025 – 2024
2025
2024
Change
Change
in EUR 1,000
in EUR 1,000
in EUR 1,000
In %
Gross rental income
4,964
5,315
-/- 351
-/- 6.6%
Service cost income
2,298
2,054
244
11.9%
Total income
7,262
7,369
-/- 107
-/- 1.5%
Service costs
-/- 2,365
-/- 2,070
-/- 295
-/- 14.3%
Operational costs
-/- 1,651
-/- 1,514
-/- 137
-/- 9.0%
Net rental income
3,246
3,785
-/- 539
-/- 14.2%
A comparison of properties held in both years shows that the underlying performance of the continuing
portfolio was relatively stable, with total income decreasing only slightly to EUR 7.3 million. Within this like-
for-like portfolio, gross rental income declined moderately, while service cost income increased, reflecting
higher recoveries from tenants. Net rental income of EUR 3.2 million compared with EUR 3.8 million in the
previous year. The vacancy of the EOS property in Bucharest following the departure of Danone in March
2025 impacted on the figures from mid-year onwards.
FUND PORTFOLIO OPERATIONS
The following table presents a selection of key indicators that provide an overview of the operational
performance, portfolio structure and financial position of the Fund’s real estate portfolio at year-end. These
indicators offer a view of how the portfolio has evolved compared to the previous year, reflecting changes
in portfolio size, operational performance, financial structure and market valuation. Together, they help to
illustrate the main developments within the portfolio during the year and provide context for the movements
in income generation, occupancy, leverage and cost ratios.
Table 7 – Comparative statement of the real estate portfolio based on indicators
31-12-2025
31-12-2024
Change (in %)
Fair value per asset (in EUR 1,000)
3,120
3,790
-/- 17.7
Net rental & related income per asset
13
(in EUR 1,000)
201.5
226.3
-/ 11.0
Occupancy (in %)
82.1
85.7
-/- 3.6
Total loan-to-value (in %)
33.3
33.4
-/- 0.1
Discount Share price to NNNAV (in %)
38.0
43.0
5.0
Ongoing Charges Figure (in %)
10.1
8.5
-/-1.6
Fund expense ratio (in %)
4.5
4.1
-/-0.4
Solvability
14
(in %)
151.3
136.5
14.8
The indicators show that the portfolio contracted during the year, reflecting the continued execution of the
monatisation programme and a reduction in the number of assets held. The average number of properties
declined, which was accompanied by a decrease in the fair value per asset and a lower level of net rental
income generated per property.
Operational performance diminished slightly, as reflected in a modest decline in occupancy and a
corresponding reduction in net rental and related income per asset. Despite the contraction of the portfolio,
the balance sheet position remained stable. The loan-to-value ratio improved marginally, while solvability
increased significantly, indicating a stronger equity position. At the same time, the discount of the share
price to NNNAV narrowed, as the market valuation moved closer to the underlying value of the portfolio.
Cost ratios increased compared to the previous year, with both the ongoing charges figure and the fund
expense ratio rising, reflecting the impact of a smaller portfolio base on relative operating expenses. This
process will continue as further disposals take place.
12
Solely based on property assets in possession during whole 2025
13
Net rental & related income per income producing asset
14
Defined as equity / liabilities x 100%
17
5.3
FINANCIAL PERFORMANCE REVIEW
The Fund’s intrinsic value declined during 2025, while the share price remained relatively stable. Compared
with the previous year, NNNAV per share decreased materially due to sale results and valuation
movements, whereas the market price of the shares showed only a modest decline. This results in a
decreasing gap between the Fund’s intrinsic value per share and its share price.
NAV PER SHARE AND SHARE PRICE DEVELOPMENT
The following table presents the development of the Fund’s share price and Triple Net Asset Value
(NNNAV) per share during the year, as well as the resulting total return for shareholders. This comparison
provides insight into both the underlying performance of the portfolio, as reflected in the change in NNNAV,
and the market valuation of the Fund through share price development. By analysing both indicators,
investors can assess how the intrinsic value of the portfolio evolved during the year and how this
development was reflected in the market price of the Fund’s shares.
Table 8 – Total Return on share price and Triple NAV during 2025
Based on share price
Based on NNNAV
In EUR
In %
In EUR
In %
Start of period
6.80
10.71
End of period
6.68
9.66
Return
-/- 0.12
-/- 1.8
-/- 1.05
-/- 9.8
Distribution to shareholders
-
-
Total Return
-/- 0.12
-/- 1.8
-/- 1.05
-/- 9.8
During 2025, the Fund’s Triple Net Asset Value (NNNAV) per share decreased by EUR 1.05, representing
a decline of 9.8%, from EUR 10.71 at the start of the year to EUR 9.66 at year-end due to the sale of Letna.
Over the same period, the Fund’s share price decreased from EUR 6.80 to EUR 6.68, resulting in a negative
total return of 1.8% for the year based on share price performance.
Figure 1 – Development of the Fund’s share price per share during 2025
Figure 1 shows a steady trend in the Fund’s share price throughout 2025, with minor fluctuations along the
way. Trading volume remained relatively modest throughout the year.
0
5.000
10.000
15.000
20.000
25.000
30.000
35.000
0
1
2
3
4
5
6
7
8
01 2024
04 2024
07 2024
10 2024
01 2025 04 2025
07 2025
10 2025
Share price (EUR)
APF share price
Number of Shares
18
Table 9 – Comparative statement of the NNNAV per share
All in EUR 1,000
31-12-2025
Proforma
31-12-2024
Shareholders’ equity in accordance with IFRS
38,777
42,476
Exclude:
1.
Fair value of financial instruments
-/- 26
-/- 127
2.
Fair value of deferred tax
377
2,315
Shareholders’ equity in accordance with NAV
39,128
44,664
Include:
3.
Fair value of financial instruments
26
127
4.
Fair value of deferred tax
-/- 885
-/- 2,935
5.
Minimum net expected value of claims under negotiation
-
-/- 491
6.
Share-based payments acquisition of subsidiaries
-
1,082
Shareholder’s equity in accordance with NNNAV
38,269
42,447
Number of profit-sharing shares
3,962,436
3,882,965
7.
Effect of issuance of profit-sharing shares (share-based payments)
0
79,471
Number of profit-sharing shares (diluted) after issuance of shares
3,962,436
3,962,436
NNNAV per profit-sharing share
9.66
10.71
Annual return on NNNAV (in %)
-/- 9.8
-/- 2.0
See also section 7.1.4 untill 7.1.11
The decrease in NNNAV reflects the reduction in shareholders’ equity following the sale of the Letna 45
office in Kosice. The deduction for deferred tax liabilities was significantly lower. The fair value adjustment
for financial instruments remained limited. As a result, the difference between NAV and NNNAV narrowed
compared with the previous reporting period.
In addition, the number of profit-sharing shares increased during 2024 following the issuance of shares for
the acquisition of the Kyanovski asset. As this issuance was fully reflected in the diluted share count in the
prior year, no further dilution effect occurred in 2025. Consequently, the development in NNNAV per share
in 2025 primarily reflects the underlying change in shareholders’ equity rather than changes in the share
base.
INCOME AND EXPENSES ANALYSIS
The following section provides an analysis of the Fund’s financial performance for the year ending
December 31, 2025. The analysis shows a reduction in the Fund's total assets and earnings per share due
to asset sales, and commensurate reductions in total liabilities and improvements in ongoing charges ratios.
19
RESULT
The following table compares key financial figures for 2025 and 2024, showing the Funds performance in
terms of rental income, operational costs and net results.
Table 10 – Overview of result
All in EUR 1,000
2025
2024
Change
Gross rental income
5,060
6,334
-/- 1,274
Service charge income
2,330
2,495
-/- 165
Service charge expenses
-/- 2,425
-/- 2,610
+ 185
Property operating expenses
-/- 1,691
-/- 1,807
+ 116
Net rental and related income
15
3,274
4,412
-/- 1,138
Net result on equity investments
266
80
+ 186
Financial and other operating income
653
882
-/- 229
Total direct income
4,193
5,374
-/- 1,181
Administrative expenses
-/- 678
-/- 675
-/- 3
Other operating expenses
-/- 1,252
-/- 1,296
+ 44
Financial expenses
-/- 1,681
-/- 2,596
+ 915
Total direct costs
-/- 3,611
-/- 4,567
+ 956
Direct result before tax
16
582
807
-/- 225
Indirect result before tax
-/- 5,415
-/- 827
-/- 4,588
Result before tax
-/- 4,833
-/- 20
-/- 4,813
Tax
-/- 488
12
-/- 500
Result after tax
-/- 4,345
-/- 32
-/- 4,313
The Fund’s result in 2025 is materially lower, primarily driven by a decline in rental income due to the
reduction in size of the portfolio and the sale result of the Letna property.
Total direct income decreased from EUR 5.37 million in 2024 to EUR 4.19 million in 2025. This decline was
mainly attributable to lower gross rental income, which fell by EUR 1.27 million to EUR 5.06 million, reflecting
the impact of asset disposals and a smaller income-generating portfolio. Service charge income also
declined modestly to EUR 2.33 million, although this was largely offset by a reduction in service charge
expenses and lower property operating expenses. As a result, net rental and related income decreased by
EUR 1.14 million to EUR 3.27 million. This decline was partly mitigated by an improvement in the net result
on equity investments, which increased to EUR 266,000, while financial and other operating income
declined compared with the previous year.
On the cost side, administrative expenses remained broadly stable at EUR 678,000. Other operating
expenses decreased to EUR 1.25 million. Financial expenses decreased significantly from EUR 2.60 million
to EUR 1.68 million, providing a partial offset to the decline in income. As a result, the direct result before
tax decreased from EUR 807,000 in 2024 to EUR 42,000 in 2025.
The indirect result before tax deteriorated substantially, declining from EUR -/- 827,000 in 2024 to
EUR -/- 5.42 million in 2025, mainly due to the Letna 45 sale result. Consequently, the result before tax
amounted to EUR -/- 4.83 million compared with EUR -/- 20,000 in the previous year, and the result after
tax decreased to EUR -/- 4.35 million.
15
See for applicable portfolio in 2025 and 2024 section 14.5 Segment results
16
Total direct income minus Total direct costs.
20
Table 11 – Statement of comprehensive income
All in EUR 1,000
2025
2024
Profit for the period
-/- 4,345
-/- 32
Items that are or may be reclassified subsequently to profit or loss:
Foreign currency translation differences on net investment in group companies
-/- 436
-/- 871
Income tax on foreign currency translation differences on net investments in
group companies
1
28
Total foreign exchange differences
-/- 435
-/- 843
Total comprehensive income for the period
-/- 4,780
-/- 875
See also section 10 Consolidated statement of comprehensive income
Total comprehensive income for the period declined significantly compared with the previous year, primarily
due to a substantial decrease of the Fund’s result for the period, while the impact of foreign currency
translation differences moderated.
In contrast to the previous year, the impact of currency translation on net investments in foreign group
companies was less pronounced. Although foreign exchange differences remained negative, the loss from
translation movements decreased to EUR 0.44 million compared with EUR 0.84 million in 2024, indicating
lower volatility in currency movements affecting the Fund’s foreign operations.
As a result, the overall comprehensive loss for the year was largely driven by operational or valuation-
related results recorded in profit or loss, while the contribution from currency translation differences became
relatively less significant in the composition of total comprehensive income.
CASH FLOW
The net cash flow of the Fund after operating-, investment- and financing activities was minus EUR 25,000
(2024: EUR 51,000). The table below provides a breakdown of the cash flow (see also section 12
‘Consolidated statement of cash flows’).
Table 12 – Consolidated cash flow statement
All in EUR 1,000
2025
2024
Cash flow from operating activities
-/- 1,502
1,880
Cash flow from investing activities
4,845
8,400
Cash flow from financing activities
-/- 3,368
-/- 10,229
Net increase / decrease (-/-) in cash and cash equivalents
-/- 25
51
The Fund recorded an overall stabilisation of its cash position in 2025, ending the year with a marginal
decrease in cash and cash equivalents.
The development was primarily driven by a significant reduction in cash inflows from investing activities,
which declined to EUR 4.8 million compared with EUR 8.4 million in the prior year. The strong inflow in 2024
had been largely driven by proceeds from property disposals, while the lower level of investing cash flows
in 2025 indicates a reduced level of such transactions. At the same time, operating activities generated a
negative cash flow of EUR -/- 1.5 million, compared with a positive contribution in the previous year,
reflecting less operational cash generation during the period.
Cash outflows from financing activities also declined materially to EUR -/- 3.4 million from EUR -/- 10.2
million in 2024, indicating a lower level of debt repayments compared with the prior year when sales
proceeds were largely used to reduce bank borrowings. Overall, the combined effect of lower investing
inflows, negative operational cash flow and reduced financing outflows resulted in a broadly neutral net
movement in cash during the year.
21
KEY BALANCE SHEET MOVEMENTS
The balance sheet contracted further during 2025. Compared with the previous year, total assets,
shareholders’ equity and deferred tax liabilities decreased, mainly driven by continued portfolio disposals
and the associated reduction in the asset base. This results in a smaller and structurally simplified balance
sheet following the ongoing portfolio monetisation strategy.
Table 13 – Balance statement
All in EUR 1,000
31-12-2025
31-12-2024
Change
Investment properties, Investment property under development
and investments in associates
46,666
49,438
-/- 2,772
Non-current assets
282
1,076
-/- 794
Current assets
17,458
23,081
-/- 5,623
Total assets
64,406
73,595
-/- 9,189
Shareholders’ equity
38,777
42,476
-/- 3,699
Deferred tax liabilities
441
2,647
-/- 2,206
Long-term loans and borrowings
3,108
17,217
-/- 14,109
Total current liabilities
22,080
11,255
10,825
Total shareholders’ equity and liabilities
64,406
73,595
-/- 9,189
See also section 8 Consolidated statement of financial position
The balance sheet contracted further in 2025, primarily reflecting a continued reduction of the asset base
following portfolio disposals and balance sheet restructuring. Total assets declined to EUR 64.41 million
from EUR 73.60 million in the previous year. This development was mainly driven by a further decrease in
the value of investment property, which fell by EUR 2.77 million to EUR 46.67 million, as well as a reduction
in current assets, which declined by EUR 5.62 million to EUR 17.46 million. Non-current assets also
decreased to EUR 0.28 million, indicating a smaller level of long-term holdings outside the core investment
property portfolio.
On the liabilities side, shareholders’ equity decreased by EUR 3.70 million to EUR 38.78 million, reflecting
the impact of the share buy back. A significant structural change occurred in the debt profile: long-term
loans and borrowings decreased from EUR 17.22 million to EUR 3.11 million, while total current liabilities
increased to EUR 22.08 million, reflecting a reclassification of financing from long-term to short-term
positions. Subsequent to the reporting period, the major HYPO NOE loan was refinanced, resulting in the
related liabilities being reclassified back to long-term end Q1 2026. At the same time, deferred tax liabilities
declined substantially to EUR 0.44 million, consistent with the overall reduction in the asset base. Together,
these movements reflect both the continued downsizing of the portfolio and a change in the structure of the
Fund’s liabilities.
22
BANK LOANS
The total level of interest-bearing debt remained broadly stable during the year, while the maturity structure
changed significantly. Compared with the previous year, a large portion of long-term borrowings shifted to
short-term classification, mainly driven by approaching loan maturities and refinancing timelines. This
results in a substantially shorter maturity profile of the Fund’s debt at year-end.
Table 14 – Overview of interest-bearing loans and borrowings
All in EUR 1,000
31-12-2025
31-12-2024
Non-current part of loans and borrowings
Secured bank loans
1,027
16,526
Other loans and borrowings
250
250
Subtotal
1,277
16,776
Lease liabilities
1,393
-
Total non-current part of loans and borrowings
2,670
16,776
Current part of loans and borrowings
Secured bank loans
16,778
4,002
Other loans and borrowings
1,508
1,764
Subtotal
18,286
5,766
Lease liabilities
100
-
Total current part of loans and borrowings
18,386
5,766
Grand total loans and borrowings
21,056
22,542
The Fund’s total interest-bearing loans and borrowings remained broadly stable year-on-year, while the
structure of the debt portfolio changed significantly due to a shift from long-term to short-term financing.
This development is mainly driven by the reclassification or approaching maturity of secured bank loans,
resulting in a substantial decline in the non-current portion of loans and borrowings and a corresponding
increase in the current portion. Non-current secured bank loans decreased sharply from EUR 16.53 million
to EUR 1.03 million, while the current portion of secured bank loans increased from EUR 4.00 million to
EUR 16.78 million. At the same time, lease liabilities were recognised again on the balance sheet following
the reclassification of certain assets from held for sale back to investment property. Other loans and
borrowings remained relatively stable in the non-current category and declined slightly within the current
portion.
As a result, the composition of the Fund’s debt shifted materially toward short-term liabilities. While the
overall level of debt decreased slightly from EUR 22.54 million to EUR 21.06 million, the balance sheet at
year-end reflected a significantly higher proportion of current borrowings compared to the previous year,
indicating a shorter remaining maturity profile of the Fund’s financing structure. Subsequent to the reporting
period, the major HYPO NOE loan was refinanced, resulting in the related liabilities being reclassified back
to long-term in Q1 2026.
23
Table 15 – Overview of secured bank loans
All in EUR 1,000
31-12-2025
31-12-2024
UniCredit (Czech assets)
1,027
2,774
HYPO NOE (Polish freehold assets)
0
11,472
Patria Bank (Romanian asset)
0
2,278
Total long-term secured interest-bearing loans and borrowings
1,027
16,526
Slovenská Sporiteľňa (Slovakian asset)
3,025
3,139
UniCredit (Czech assets)
2
57
HYPO NOE (Polish freehold assets)
11,473
516
Patria Bank (Romanian asset)
2,278
290
Total short-term secured interest-bearing loans and borrowings
16,778
4,002
Total secured interest-bearing loans and borrowings
17,805
20,528
Total secured interest-bearing loans and borrowings declined further during the year, reflecting continued
deleveraging of the portfolio combined with a significant shift in the maturity profile of the Fund’s financing.
The reduction in total debt was mainly driven by further repayments of the UniCredit loan secured on the
Czech assets, which declined from EUR 2.77 million to EUR 1.03 million. In addition, the long-term loans
previously provided by HYPO NOE for the Polish freehold assets and by Patria Bank for the Romanian
asset were no longer classified as long-term at year-end. As a result, total long-term secured interest-
bearing loans and borrowings decreased sharply from EUR 16.53 million in 2024 to EUR 1.03 million in
2025.
Several facilities shifted to short-term classification. The HYPO NOE loan for the Polish freehold assets
increased significantly within short-term borrowings, rising to EUR 11.47 million compared with EUR 0.51
million in the previous year. Similarly, the Patria Bank facility for the Romanian asset increased to EUR 2.28
million in the short-term category, while the Slovenská Sporiteľňa loan for the Slovakian asset remained
broadly stable at approximately EUR 3.03 million. Consequently, total short-term secured interest-bearing
loans and borrowings increased substantially to EUR 16.78 million at year-end, reflecting the reclassification
of several facilities to short-term maturities.
Table 16 - Calculation of Loan to Value
17
All in EUR 1,000
Notes
31-12-2025
31-12-2024
Face value of secured bank loans
15.15.3
17,885
20,674
Less: face value secured bank loan Slovenská Sporiteľňa
15.15.3
-/- 3,025
18
N.a.
Face value of other loans and borrowings
15.15.9
1,758
2,014
Face value of (share in) loans held by associates
15.4.1
-
-
16,618
22,688
Investment property
15.2
43,121
44,765
Less: right-of-use assets
15.2
-/- 1,465
-
Investment property under development
15.3
-
1,271
(Share in) properties held by associates
15.4.1
3,894
3,852
Assets held for sale
15.12
4,315
19,580
Less: right-of-use assets held for sale
15.12.1
-
-/- 1,510
49,865
67,958
Loan to Value (LTV)
33.3%
33.4%
17
The Loan to Value should be considered as an “Alternative Performance Measure” (APM)
18
Since corresponding property has been sold, also the corresponding secured bank loan has been adjusted for calculation
purposes of LTV.
24
ONGOING CHARGES FIGURE
The Fund’s cost ratios increased during the period. Compared with previous years, the Ongoing Charges
Figure rose further, mainly driven by higher fund-level expenses and the effect of a smaller asset base
following portfolio disposals. This results in higher cost ratios relative to assets under management despite
largely stable absolute administrative costs.
Table 17 – Ongoing Charges Figure
All in %
2025
2024
2023
2022
Ongoing Charges Figure
10.11
8.53
7.66
8.02
OCF excl. one-off and refinancing costs acc. to APM
8.63
8.01
7.63
7.61
Fund expense ratio acc. to APM
4.52
4.08
3.87
3.71
See also chapter 15.38 “Ongoing Charges Figures”
Over the four-year period from 2022 to 2025, the Ongoing Charges Figure (OCF) has increased from 8.02%
in 2022 to 10.11% in 2025, representing an overall rise of 2.09 percentage points.
When considering the OCF excluding one-off and refinancing costs (as defined in the APM), the figure
shows a more moderate development. The adjusted OCF increased from 7.61% in 2022 to 8.63% in 2025.
This development indicates that, although part of the increase in the reported OCF relates to incidental or
refinancing-related costs, underlying cost pressures have also contributed to the higher ratio in recent years.
Similarly, the fund expense ratio according to APM increased from 3.71% in 2022 to 4.52% in 2025. After
a gradual rise from 3.71% in 2022 to 3.87% in 2023 and 4.08% in 2024, the ratio increased further in 2025,
reflecting higher ongoing fund-level expenses relative to the fund’s reduced asset base.
CURRENCY EXCHANGE RATE
Currency movements during the year showed differing trends across the markets in which the Group
operates. The Czech Koruna (CZK) strengthened modestly against the euro, appreciating by 3.8% year-
on-year, reversing the 1.9% depreciation recorded in the previous year. The Polish Zloty (PLN) also
appreciated slightly, increasing by 1.3% year-on-year, compared with a 1.5% appreciation in 2024.
In contrast, the Romanian Leu (RON) weakened against the euro, depreciating by 2.5% year-on-year,
following a stable performance in the previous year. The Ukrainian Hryvnia (UAH) experienced a more
pronounced depreciation of 13.5%, compared with a 4.1% decline in 2024, reflecting the continued
macroeconomic and geopolitical pressures resulting from the ongoing conflict with Russia.
Finally, the US Dollar (USD) weakened significantly against the euro, with the euro appreciating by 13.1%
year-on-year, reversing the 6.0% depreciation recorded in the prior year.
Table 18 – Exchange rates used for the Statement of Financial Position (see also 13.8.4)
31-12-2025
31-12-2024
Czech Koruna (EUR/CZK)
24.2370
25.1850
% change year-on-year
3.8
-/- 1.9
Polish Zloty (EUR/PLN)
4.2210
4.2750
% change year-on-year
1.3
1.5
Romanian Leu (EUR/RON)
5.0968
4.9743
% change year-on-year
-/- 2.5
0.0
Ukrainian Hryvnia (EUR/UAH)
49.8565
43.9266
% change year-on-year
-/- 13.5
-/- 4.1
US Dollar (EUR/USD)
1.1750
1.0389
% change year-on-year
-/- 13.1
6.0
Source: European Central Bank (ECB) if available. Exchange rates Ukrainian Hryvnia are based on National Bank of Ukraine.
25
5.4
ECONOMIC BACKGROUND
ECONOMIC BACKGROUND AND OUTLOOK
European economies experienced a moderate and gradual cyclical recovery in 2025. GDP growth in the
EU accelerated to 1.6% year-on-year last year, according to Eurostat, up from the 0.9% level seen in 2024.
While the implications of Russia’s February 2022 invasion of Ukraine and de-globalisation effects are still
unfolding, the EU and Eurozone managed to initially weather the imposition of tariffs on Europe and many
other countries by the US Presidential Administration. European economies are now clearly part of a
multipolar and more unpredictable world, which presents both threats and opportunities.
European economies have begun a slow transition away from the globalised, export-led model that
prevailed up to the 2020-22 period. The shocks of the COVID pandemic and Russia’s invasion of Ukraine
have triggered various consequences, including more intra-EU trade, a rise and fall of interest rates and an
increase in domestic investment. Much of the acceleration in EU economic growth last year was due to
household consumption improving on the back of a fall in inflation measures and consequent cuts in interest
rates from the ECB and other Central Banks in 2024 and H1 2025. It is notable that several EU countries,
both in the Mediterranean Basin and in CEE, easily out-performed the larger manufacturing-based French
and German economies.
German GDP growth flat-lined at 0.2% in 2025. Europe’s biggest economy has suffered stagnation since
2023, having lost its cheap energy input, Russian gas and as demand subsided for a key export, internal
combustion engine motor vehicles. Policies introduced in 2025 to pull Germany out of this GDP torpor focus
on domestic investment through an EUR 500bn “investment offensive” in infrastructure, defence and green
energy projects. Digitalisation, labour force participation and strengthening capital markets are all priorities
for the Merz government. The success of these initiatives will impact on economic growth in the CEE region,
as the export links are still very strong: 29% of Czech, 25% of Polish and 18% of Romanian exports
respectively went to Germany in 2024.
GDP GROWTH, SELECTED CEE COUNTRIES AND GERMANY, 2021-26E (%)
Source: countryeconomy.com (historical data), 2022A for Ukraine from the EBRD. Arcona Capital external
consultancy (2026 estimates), based on European Commission, EBRD estimates
GDP growth in Poland (3.6% year-on-year) and Czechia (2.5% year-on-year) accelerated in 2025,
withstanding the drag of weak performance from their largest export customer. Domestic demand, strong
wage growth, falling inflation, interest rate cuts and domestic and EU-funded investments help drive their
recovery from the soft 2023-24 period. Ukraine’s activity expanded again, driven by the demands of the
war. By contrast, GDP growth in Romania remained well below trend last year, as the government acted to
rein in the country’s very wide (8%-9% of GDP) fiscal deficit through spending cuts and some tax hikes. EU
financial support helped Romania balance its books in 2025. The National Bank of Romania held interest
rates flat at 6.5% all year long to help combat inflation, which rose to close to 10% year-on-year by the year
end.
3.6
2.5
0.6
2.0
0.2
3.4
2.0
1.2
2.5
1.0
-8.0
-4.0
0.0
4.0
8.0
Poland
Czech Republic
Romania
Ukraine
Germany
2021
2022
2023
2024
2025
2026E
-30.0
26
CONSUMER PRICE INFLATION AND CENTRAL BANK POLICY INTEREST RATES, SELECTED CEE
COUNTRIES AND GERMANY, FEBRUARY 2026 (%, YOY)
Source: investing.com, TradingEconomics
*January 2025 data published in February 2025
Subsiding inflation rates throughout last year encouraged the European Central Bank (
ECB
) to decrease
Eurozone interest rates by a further 100 basis points (1.0%) during 2025, following 125 basis points of cuts
in 2024. Consumer price inflation dropped to 2.1% in Germany and just 1.7% in the Eurozone in January
2026. The National Bank of Poland (
NBP
) slashed interest rates 6 times in 2025, from a level of 5.75% to
4.0%, as inflationary pressures also eased in CEE’s largest economy. The NBP had kept policy rates on
hold throughout 2024. The Czech National Bank (
CNB
) trimmed its policy rates twice in H1 2025 to a level
of 3.5%, having reduced benchmarks by 150 basis points the year before. A fall in inflation from nearly 16%
in May 2025 to 7.4% by January 2026 vindicated the high-interest-rate stance of the National Bank of
Ukraine throughout last year.
The threat and imposition of tariffs over the past 12 months by the US Trump Administration has profound
implications for global trade and export-dependent economies. This includes the trade-driven economies of
our region and is an economic growth risk. The EU arrived at a bilateral trade deal with the US in July 2025,
to the advantage of the US. This deal appears in some jeopardy at the time of writing, given recent events:
the US Supreme Court struck down many of President Trump’s tariff measures in February 2026. President
Trump’s subsequent immediate imposition of general global tariffs on all trading partners brings into
question the efficacy and permanence of bilateral deal-making presently. Business planning for companies
becomes more difficult in these periods of volatility in political decision-making.
The EU Commission authorised in 2025 large commitments to military spending via allowing governments
in EU countries to widen budget deficits. The EU aims to bolster defence and infrastructure capabilities,
chiefly against the perceived threat from Russia, via the ReArm Europe/Readiness 2030 programme. This
has the potential to add 1%-2% to EU GDP growth per annum for the coming five years. Unproductive
industrial capacity looks likely to be repurposed for rearmament over coming quarters and years.
The onset of substantial capital expenditures on Artificial Intelligence is another global phenomenon with
the potential to disrupt the pre-COVID world economic order further. Productivity gains may well result,
helping GDPs to grow. But the effect on the employment of workers and, therefore, consumer demand in
economies could be profound. EU and especially Czech unemployment levels are low, which supports
growth in domestic consumption at present.
The implications of the above changes could be profound, if they become permanent. All the while the war
in Ukraine persists and EU military spending accelerates, the greater is the chance of a crystallisation of a
new “Cold War”-style division with Russia: albeit with the “Iron Curtain” located further east. The eruption
of another war, at the time of writing, in the Middle East between Iran, Israel and the US threatens instability.
The CEE Central Banks will have to be vigilant on local currency volatility and food/commodity price
inflation, having lived through the 2022-23 experience. Increasing uncertainty generally increases the cost
and risk of doing business and therefore the cost of capital around the world.
The CEE’s growing IT specialism, historical legacy of military manufacturing, labour flexibility and still-cheap
workforces remain as longer-term positives in this difficult international environment.
2.2%
1.6%
9.6%
7.4%
2.1%
4.0%
3.5%
6.5%
15.0%
2.4%
0%
3%
6%
9%
12%
15%
18%
Poland
Czech Republic
Romania
Ukraine
Germany
Consumer price inflation, (latest*, % year-on-year)
Central Bank interest rate (latest, %)
27
REAL ESTATE MARKETPLACE
The gradual easing of financial conditions that began in 2024 in the Eurozone and CEE continued last year.
Real estate volumes across the European arena rose some 13% in 2025 to a level of EUR 241bn. Volumes
in CEE expanded a further 32% last year, according to Colliers. The EUR 11.6bn seen across the core 6
CEE countries thus amounts to nearly 5% of European transactions, up from just over 4% in 2024. It is also
comfortably above the previous 5-year moving average of EUR 9.4bn. More realistic valuation and
operational assumptions from market participants has bridged the gap between vendor and purchaser
pricing expectations.
CEE-6 REAL ESTATE INVESTMENT VOLUMES (2007-2024, EUR bn)
Source: Colliers data
Last year saw the fifth-largest volumes seen in the 19 years back to 2007. Record activity in the Czech
market, which saw 139% growth to EUR 4.3bn, according to Colliers data, explains the bulk of the increase.
That level almost matched that of CEE’s largest market, Poland, which registered EUR 4.5bn of purchases,
down some -10% on the year before. Substantial growth in activity was also apparent in Hungary, up 136%
to EUR 0.8bn and Slovakia, where transactions nearly doubled to EUR 1.0bn. Romanian and Bulgarian
volumes subsided, down -34% and up just 2% year-on-year respectively.
CEE-6 FLOWS BY COUNTRY (2025, EUR bn)
CEE-6 FLOWS BY SECTOR (2025, %)
Source: Colliers
Source: Colliers
Looking at asset classes, the three traditionally large sectors again made up the bulk of the volumes last
year. It was the turn of the Office sector to shine, with 33% of the pie and seeing growth of some 44%
compared to 2024’s levels, according to Colliers. Prime transactions stood out, especially in Prague and
Warsaw with investors targeting solid rental growth in quality assets. A 43% increase propelled the Industrial
& Logistics sector to second place with a share of 25%. Volumes in the Retail sector stalled overall, down
-22% to a 19% share with solid retail park activity not making up for less larger shopping centre transactions.
Hotel volumes more than doubled, to EUR 0.9bn, reflecting a Continent-wide trend. Purchases of Mixed-
Use assets also picked up significantly, especially in Poland, translating into a 10% share of overall CEE-6
activity.
Domestic and regional investors made up a majority of the 2025 buyers in the CEE-6 markets for the first
time. Their 64% share, according to Colliers, easily eclipses the equivalent 38% 2020-24 average; this was
itself a step up from near-zero levels seen in the two cycles prior to 2020. Domestic funds in Hungary and
especially Czechia have grown tremendously in size over the last decade. In 2025, as before, they bought
assets both in their home markets and across the region. Over 80% of Czech and and 70% of Hungarian
volume in the first three quarters of the year respectively came from this source. Polish domestic investors
11.2
6.1
2.2
3.6
6.6
3.9
5.9
7.5
8.8
12.1
13.1
13.8 13.8
10.4
11.1
10.7
5.2
8.8
11.6
0
3
6
9
12
15
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
4.5
4.3
0.8
1.0
0.5
0.4
Poland
Czech Republic
Hungary
Slovakia
Romania
Bulgaria
33%
19%
25%
5%
8%
10%
Office
Retail
Industrial
Residential
Hotel
Mixed-Use
28
also registered a significant share in their home market for the first time, with over 40% of purchases in that
same period. By contrast, volumes from Western Europe dropped to below EUR 2bn, or 17% of the total
pie, compared to EUR 2.6bn, or 29% in 2024. American investors committed more capital, 11% of the total
in the CEE-6 countries last year, up from 7% the year before.
BENCHMARK PRIME YIELDS IN SELECTED CEE SEGMENTS & KEY FUNDING RATES (EUR, %,
2024-25)
Source: Colliers, unless stated below
* Source: CBRE, 8.65% yield data is as of Q3 2023. 2025 data is calculated yield of known transaction in
Q1 2025
** Source: JLL (2024) and Avison Young (2025). No region specified
Purchasers and vendors transacted last year’s leap in CEE volumes at very similar yields to the last two
years. Yields in the CEE commercial real estate space have held steady since the 2023 upward reversal of
benchmarks, linked to funding rate rises. The sustaining of end 2024’s low EURIBOR 5-year swap rates in
the 2.2%-2.5% range through to end 2025 and beyond has enabled lenders to gradually facilitate the return
of liquidity to the marketplace. The trimming of ECB policy rates last year also aided this process. Thus far,
there is little sign that the anticipated increase in government spending on defence and infrastructure is
causing general inflation and if the strength of the Euro persists, policy rates may be cut again this year.
Such stimulus would sustain transaction liquidity in the European and CEE real estate arenas. Stronger
economic growth in the medium term would also boost commercial rents. Higher capital valuations through
rental growth would then be possible, which would most likely encourage transaction volumes upwards.
REAL ESTATE OUTLOOK
The growth of CEE real estate transaction volumes last year indicates that the apparent global uncertainties
did not derail demand for the region’s assets. Transactions occurred where rental durability and growth
could be demonstrated. New builds, where they are appearing, tend to have the highest ESG credentials
and a high level of technological readiness. Interest premiums applied by the funding banks did edge down
last year, with KPMG stating in their annual Property Lending Barometer published in Q3 2025 that 40% of
CEE regional bank respondents reported a slight decrease (compression) in premiums compared with
2024, with 50% reporting no change. Taking into account the lower EURIBOR rates, this trimming of the
cost of finance has allowed transaction levels to rise to the highest levels this decade.
Absent geopolitical events pushing up commodity prices, the recent strengthening of the Euro, Zloty and
Koruna might provide room for another policy interest rate cut from any or all of the ECB, NBP and the CNB
sometime during 2026. Looking beyond that to the medium term, the planned fiscal expansion across EU
countries would probably accelerate economic growth and actually imply a need for moderate future interest
rate rises. This is indeed what higher longer term bond yields point towards at present. At the same time,
financing banks and bond buyers may well become more convinced that the European and CEE economies
will grow faster in coming years. In that case, the funding premium charged to real estate players over these
“base” levels could well fall moderately due to expectation of greater demand for product and rent
appreciation.
2.18
8.65
7.25
5.50
7.50
2.23
7.25
7.25
5.25
7.25
0
2
4
6
8
10
EURIBOR 5yr swap
rate
Poland Szczecin
office *
Polish prime retail
park **
Prague prime office
Bucharest prime
office
Q4 2024
Q4 2025
29
Rent growth helps CEE real estate assets hold their value in inflationary environments. Eurozone CPI
averaged 2.1% in 2025 and is set into many tenancy agreements across sectors via indexation linkage.
The rent and service charge cost shocks of the 2022-23 period remain in place but there is no clear evidence
of vacancy rates systematically rising as a result of service charges inflating. The 2022-23 leap in
construction costs, however, does appear to have constricted development activity in several sectors.
The Office sector remains CEE’s largest, all as a result of legacy, as a significant lack of developer
completions has squeezed supply in the last 2-3 years. Investors are paying for rental growth and they and
tenants are seeking high-quality ESG-compliant assets. This is forcing vacancy rates in our locations
generally lower, certainly for prime buildings. Obsolescence risk as assets age, consideration of the space
needed in the post-COVID environment, tech-readiness and delivery of optimal workplace solutions do
remain as risks for the sector. This is most apparent in non-prime office locations and both European and
CEE real estate consultants are noting a potential bifurcation of the office rental markets into prime/non-
prime arenas. The situation in the retail park & convenience store
sector is somewhat easier, as consumers
prioritise proximity and a tenant mix that matches everyday needs. This mix is appealing to investors and
tenants, as generating a relatively safe exposure to GDP growth. Supply of new builds continues to climb
in this arena, in contrast to Traditional Shopping Centres, particularly in Poland. Rent growth for Logistics
tenants has continued, though at slower rates than 2-3 years ago, as new supply has increased. The
region’s logistics story is no longer just about e-commerce, as supply chain reconfiguration, “near-shoring”,
manufacturer resilience and a shift towards higher-value locations for occupiers have become more
important. The road highway build-out is largely complete in Poland but continues in the Czechia, Slovakia
and Romania.
Supply chain Industrial assets could see renewed substitution demand as component
suppliers to the EU, very common in CEE, switch their product profiles to fit the new requirements from, for
example, the European defence sector. The Hotel sector is likely to remain vibrant, as tourism numbers add
to occupancy rates and general consumption especially in cities such as Prague and Budapest. This will
remain so if geopolitical conditions allow. Residential
is also gathering momentum in CEE as a new, less
cyclical sector. New product is appearing on the marketplace, especially the private rented sector (“PRS”)
and purpose-built student accommodation (“PBSA”).
The interest rate cuts seen in 2024-25 are slowly allowing present asset-holders to refinance older loans
with slightly better conditions. KPMG noted in Q3 2025 that 36% of respondents in their annual survey of
CEE lenders reported activity increasing. This included 5% seeing a significant increase. Only 8% were
seeing a decrease. A continuation of last year’s GDP growth levels should shift rent market outlooks slowly
in favour of landlords in the office and convenience retail sectors over the next 12-24 months.
The Polish office market
Unlike in 2024, office leasing demand reflected the dynamics of the Polish economy in 2025. Gross take-
up nationally rose 8% to 1.567mn sqm last year, according to Cushman & Wakefield: the economy
expanded 3.6% in real terms in 2025. Net take-up, stripping out renewals, rose 1% across the country to
760,400sqm. New supply was very constrained, dropping 52% compared to 2024 to a level of just
109,250sqm. Total stock fell by -1%, to 12.96m sqm, due to conversions to other uses. Due to these
dynamics, the office vacancy rate fell nationally, using Cushman & Wakefield data, by 1.2 percentage points
to 13.1%. This was the first material decline in the vacancy rate nationally for some years. In the flagship
Warsaw market, the vacancy rate fell by 1.4 percentage points to 9.1% by year end. In the next 7 largest
cities, vacancy rates sat in the 10.4% (Lublin) to 21.6% (Katowice) range. Prime rents in Warsaw rose 3.5%,
matching GDP growth, while across the regional cities smaller increases were observed.
The strongest demand-supply situation is in Szczecin, where our asset is located. The vacancy rates in the
city also ticked down 1.3 percentage points to just 6.4% by the end of 2025, according to Cushman &
Wakefield. There was no supply of new stock in this 189,600 sqm marketplace and last year’s take-up
equated to 11,500 sqm. Future supply via new completions remains limited in this city. Szczecin scored
well in a Business Environment Assessment Study of Polish cities published in November 2025: ratings
were high in the categories of infrastructure for running a business and attractiveness as a place to live.
Szczecin’s proximity to Scandinavia and to a German economy that is likely to be on a higher growth
trajectory in coming years is likely to keep demand robust and perhaps push rents higher in the near run.
Prime rents appeared to be stable in the EUR 13.0-16.0/sqm/month at the year-end of 2025. One
30
investment transaction, the purchase of the 21,000 sqm Piastow Office Center asset by Czech fund
Investika from Blackstone in February 2025 for CZK 1.4bn set the marker for the office yield in this market
at 7.25%.
The Polish retail market
Demand in Poland’s retail sector reflected the solidity of a 3.6% real GDP expansion in 2025. Polish retail
sales grew 4.3% over the year, with December’s monthly figure accelerating to 5.3% year-on-year. Strong
demand for durable goods and very supportive wage dynamics explain this buoyancy: national corporate
sector wage growth ranged between 6.6%-9.3% through the 12 months of 2025, well above the 2.2%-5.3%
consumer price inflation range of outcomes. Demand for essential items usually matches general inflation
through any economic cycle. This exposure to inflation spending benefits retail parks/convenience stores
and e-commerce sales of necessities. The market share of e-commerce in Poland stayed broadly flat in the
9%-10% range of total retail sales in 2025, according to BNP Paribas data. Online sales research has for
several years suggested that this proportion would grow substantially in Poland but it has in reality stayed
in the 8%-11% range since 2021: sales dynamics in “bricks & mortar” stores thus remains resilient.
Momentum in retail park & convenience store investment market activity continued to build in 2025: the
market share of retail parks & convenience assets amounted to 54% of total retail sector deal flow, EUR
466mn in total, according to Cushman & Wakefield data. This was the highest transaction flow seen in this
sub-sector in the modern history of the market. Yields have compressed, with the prime retail park
benchmark seen in the 7.0% range by several commentators, down from the 7.25% level seen 18 months
ago. An increase in the range of 10% in prime retail park rents during 2025, according to Cushman &
Wakefield, will have helped to increase market confidence in this asset class and solidify the observed yield
compression. The real estate consultancy Avison Young noted that transaction values per square meter in
the convenience retail (1,000-5,000 sqm) have been in the range of EUR 1,400-1,800 per sqm in the 2023-
H1 2025 period. Avison Young suggest that appetite for smaller formats is increasingly evident in the
transaction numbers in the period 2020-H1 2025.
Convenience retail parks have dominated the deal count since 2020 even relative to larger retail parks (over
5,000 sqm), accounting for over 70% of transactions. While the larger parks inevitably have a larger deal
value, more notable transactions are occurring: a good example was the sale of the 10-asset, 29,700 sqm
A Centrum convenience retail parks portfolio to Czech-based investor My Park in June 2025. Avison Young
also note that local Polish investors are also more active in this arena than other sectors, providing 24% of
the purchasing volume between 2023 and H1 2025.
With good demand dynamics, the development supply of retail parks to market continued in 2025. Around
75% of the 545,000 sqm of total retail sector completions were in the park format, according to Cushman &
Wakefield. This does represent a moderate slowdown from 2024’s levels. But Cushman & Wakefield also
observed that 65% of last year’s new supply was delivered through projects of below 10,000 sqm. They see
development investors actively pursuing white space opportunities for retail in smaller towns and cities.
Avison Young counted 17 convenience retail centres as under construction at the end of H1 2025, 6 of
which were in towns of 10-50,000 population and 3 in settlements with less than 10,000 inhabitants. Only
three were in cities of over 200,000 people. Assessing this versus the addressable market, Avison Young
suggest that only 65% of the Polish population has access (within 10 to 15-minute drive by car) to retail
parks and convenience centres. So, there is still room for growth in this sub-sector. Market consolidation,
the emergence of large market players and retail parks becoming attractive to institutions might be future
31
signs of saturation from the investor perspective. From the side of tenants, new parks and centres beside
old, cannibalisation of value-retailer stores and limited expansion of popular chains would also be warnings.
There are no significant signs of these factors appearing, as yet.
The Czech office market
Stronger Czech GDP growth helped the Prague office market during 2025. Vacancy rates ticked down from
7.3% at the end of 2024 to a 5-year low of 5.87%, according to CBRE. The lowest annual supply of new
space in recent history, with just 27,000 sqm of new completions, was behind the reduction. This new space
added just 0.7% to the city’s total stock of 3.94mn sqm. 2026 is forecast to be another year of low
completions, at 37,000 sqm, with Knight Frank seeing another 263,300 sqm coming to market in 2027 and
2028. When weighed against demand, these supply figures are low. Gross take-up totalled 573,200 sqm
during 2025, down by 10% from the record year seen in 2024 according to Knight Frank. Net take-up edged
down -3% year-on-year to a still-healthy 307,100 sqm. New demand for quality space in the city is still
evident.
With demand exceeding supply, prime headline rents in Prague again edged up 2% to EUR 30.0/sqm/month
by 2025’s year end, according to Colliers. Inner city class B rent levels sit between EUR 17-23/sqm/month.
Knight Frank report upward pressure on rents in the city, particularly in projects currently under construction:
achieved rental levels are seen to need to cover higher prevailing construction costs. Prime office yields
edged down 25bps to 5.25% in the course of 2025.
The Romanian office market
A prolonging of the GDP growth slowdown in Romania took its toll on Bucharest office market demand in
2025. The top-line gross take-up, measuring total leasing activity, fell -/- 26% to 250,000 sqm according to
Colliers. The new demand component fell by similar proportions, in absolute terms from 115,900 sqm in
2024 to 88,100 sqm last year. But even this lower new demand made a difference to the market balance,
as for the first time certainly in over two decades the supply of new deliveries was zero. The expected small
add to the city’s office stock did not materialise. As a result of this small net demand shift, Bucharest’s
overall vacancy rate fell to 11.75% by the year end, reported by Colliers, from 13.0% a year before.
The supply pipeline for 2026-28 is building though, according to Cushman & Wakefield, at 200,000 sqm
anticipated to be delivered by 8 projects in total over the three years. Colliers see 50,000 sqm to be delivered
in 2026 and another 100,000 sqm in 2027. Thus, the present fragile market balance may slowly tip towards
upward pressure on vacancy rates again, unless the period of relative austerity and slower growth in the
economy comes to an end concurrently.
The CBD’s most modern and ESG-compliant buildings commanded rents in the range of EUR 19-
22/sqm/month by the end of 2025, according to Colliers, at the same levels as the last 2 years. Rents also
remained stable in the EUR 11-14/sqm/month range in the Centre-East district of the city, while vacancy
rates there steadied at 14%. The overall balanced market condition trimmed prime office yields 25 basis
points to the 7.25% level in 2025.
The Ukrainian land market
Ukraine remains under martial law and fully engaged in repelling the Russian invasion that began over four
years ago on 24 February 2022. Activity in the land market is thus limited, tending to be concentrated in the
centre and western half of the country. The economy absorbed the continuing shock and disruption of the
war and the significant crowding of spending in the defence sector, managing 2.0% GDP growth in 2025
according to the EBRD. It is clear that Ukraine has built a world-class defence sector capability, which
stands it in good stead ahead of any cessation of hostilities and probably thereafter as an export hub, given
the global geopolitical environment. Russian actions continue to damage infrastructure and civilian assets
and their repair and rectification absorbs additional spending. Labour shortages and weak agricultural
output constricted economic growth according to the EBRD, especially in the first half of 2025. These
conditions eased a little in the second half of the year, helping GDP growth to recover and consumer price
32
inflation to fall from the 15.9% peak observed in May 2025 to a low of 7.4% in January 2026. The National
Bank of Ukraine trimmed its policy rate by a marginal 50 basis points to 15.0% in January 2026, having kept
its benchmark at 15.5% for the entirety of 2025. The hryvnia depreciated around 14% versus the Euro last
year, reflecting the higher domestic inflation rates. Any prospect of peace via the current US-led process
would of course relieve pressure on Ukraine’s macro-economic situation. Real estate activity will only return
towards normal when the war comes to an end. Much lower interest rates will then prevail, as the country
will very likely have substantial support from European government and multinational agencies.
Land price inflation in Ukraine, as elsewhere, is seen as a hedge on general inflation pressures. Agricultural
land prices in US dollar terms continued to rise in 2025 according to Finway, after the liberalisation of this
market earlier in the decade. Prices for land, with utility connections, suitable for development in the Kyiv
agglomeration reached the USD 2,500-3,000 per hectare in 2025, according to Visit Ukraine. The price in
Kyiv City and Kyiv Region reached USD 2,814 and USD 1,906 per hectare respectively in February 2026,
according to SV Development.
33
5.5
FUND STRATEGY AND OUTLOOK
FUND STRATEGY AND OBJECTIVE
The Fund's primary investment focus is income-generating real estate in Central and Eastern Europe. The
Fund's investment strategy aims to achieve a balanced portfolio of modern high-yielding, multi-tenanted
properties across the region with a loan to value between 40% to 50% (including convertible bonds).
Table 19 – Distribution over the countries
C
OUNTRY
2025
2024
Poland
64.2%
49.7%
Czechia
14.8%
16.2%
Slovakia
-
17.6%
Ukraine
6.6%
5.0%
Romania
14.4%
11.5%
Total
100.0%
100.0%
The Fund continually seeks to optimize its portfolio by balancing the allocation of assets across different
countries and improving its loan to value ratio.
MONATISATION PROGRESS
During 2025 the Fund continued the execution of the monetisation programme agreed with shareholders in
2023. Several assets were successfully disposed of during the year, reducing the portfolio from EUR 68.0
million across 19 assets at the end of 2024 to EUR 49.9 million across 16 assets at year-end 2025.
The key transactions were the sales of the Palmovka Point and Letná 45 assets. Although market liquidity
remained selective in the Central and Eastern European real estate markets, the disposals strengthened
the Fund’s liquidity position, reduced portfolio concentration risk and supported the continued
implementation of the capital return strategy for shareholders.
DIVIDEND AND SHARE BUYBACK
The Fund's dividend policy is to distribute approximately 35% of the operational result to shareholders based
on the annual results. This annual distribution may be replaced or supplemented by specific share buyback
programmes. A combination of cash distributions for shareholders and the retention of a portion of the
profits to reinvest in physical assets and improve tenant retention should ultimately yield the highest total
return. The Fund aims to pay an interim dividend with the half-year results, followed by a final dividend after
year-end, in cash. However, dividend proposals will consider various factors, such as expected future
capital requirements, growth opportunities, net cash generation and regulatory developments.
OUTLOOK
In 2026, the Fund will continue to focus on the execution of the portfolio monetisation programme approved
at the Extraordinary General Meeting in December 2023 whilst maintaining the operational and financial
stability of the remaining portfolio and the regulated Fund structure. The portfolio has been reduced to 16
assets with a total value of approximately EUR 49.9 million.
During 2026, the Fund will continue to take disposal opportunities where market conditions and investor
demand allow for efficient transaction execution. The Board remains committed to the continued execution
of the monetisation strategy and to returning disposal proceeds to shareholders to the fullest extent
possible.
Transaction activity in the Fund’s markets continues to be influenced by geopolitical uncertainty and limited
investment liquidity. While international capital flows remain cautious, domestic and regional investors
34
continue to show interest in income-generating assets, particularly where pricing reflects current financing
conditions. As a result, individual disposals may occur either above or below the most recent external
valuations depending on market liquidity, transaction timing and financing availability.
Maintaining stable operational performance remains essential for the successful execution of the
monetisation strategy. Asset management will therefore continue to focus on tenant retention, leasing
activity and cost control. At the same time, the Fund will continue to actively manage its financing
relationships and covenant compliance. The relatively moderate loan-to-value ratio of approximately 33%
provides flexibility to support the ongoing disposal programme.
35
5.6
RISK MANAGEMENT AND GOVERNANCE
RISK MANAGEMENT
The management of risk is an essential responsibility of the Board. We can report that there have been no
significant changes to the risk management framework outlined in section 15.41 of this annual report.
Risk appetite and risk management
Our risk management policy is designed to identify, assess and respond to the primary risks inherent in the
Fund's activities. We conduct an annual top-down review and risk inventory to manage our risk exposure
by taking mitigating measures while pursuing our business opportunities to achieve our strategic objectives.
We have identified the risks presented in section 15.41 ‘Risk management’ as our primary risks. We have
not found any other risks that could materially impact our business, but we acknowledge that unidentified
or unforeseen risks could have such an impact.
We have established an Internal Control Framework to provide reasonable assurance that risks are
identified and mitigated to achieve our significant objectives. The framework comprises monthly KPI
reporting, a cloud-based work environment supported by a data recovery plan, and a planning and control
structure. We have also implemented administrative organization and internal controls based on a division
of functions. Both contracting and payments take place based on the ‘four-eyes’ principle.
Internal control framework
Risk reports are a recurring topic at our supervisory and managing board meetings, and we continuously
monitor risks with mitigating measures in place. We stress test and discuss the results with both the
Managing and Supervisory Board to ensure effective risk management.
For further details on our main risks and uncertainties, please refer to section 15.41 ‘Risk management’ and
the notes to the consolidated financial statements.
REMUNERATION REPORT (BEZOLDIGINGSVERSLAG)
The Fund's Managing Board applies a remuneration policy that contributes to appropriate and effective risk
management while avoiding unnecessary risks within the framework of the Fund's prospectus and statutes.
This policy is in line with the Fund's strategy, the goals and values of the Managing Board, and the interests
of the Fund's investors. Additionally, the remuneration policy includes measures aimed at preventing
conflicts of interest.
The goal is to maintain a healthy balance between fixed and variable remuneration. Fixed remuneration is
sufficient for daily expenses and includes payments for education and pension contributions. Variable
remuneration should be viewed as an addition to the fixed remuneration and is based on evaluating
individual employees' achievements for the company as a whole.
The Managing Board does not provide a guaranteed variable bonus. Instead, any variable bonus is
determined based on measurable results or clear achievement goals. For further information, the full
remuneration policy of the Managing Board can be downloaded from
https://www.arconacapital.nl/algemeen/pdf/mei/20231013133731.pdf
Remuneration to the Managing Board for the period 2025
–
2021
In 2025 the Fund paid a total fee of EUR 1,059,000 (2024: EUR 1,180,000) to the Managing Board, affiliated
companies and Secure Management. Of this total amount, the Managing Board received a fund
management fee of EUR 678,000 (2024: EUR 675,000) and affiliated companies received an asset
management fee of EUR 381,000 (2024: EUR 505,000).
36
Table 20 – Total remuneration per year
All in EUR
2025
2024
2023
2022
2021
The Managing Board
678,000
675,000
675,000
705,000
648,000
Arcona Capital Czech Republic
172,000
233,000
263,000
295,000
406,000
Arcona Capital Poland
195,000
199,000
196,000
203,000
185,000
Arcona Capital Bulgaria
4,000
8,000
28,000
-
-
Secure Management
10,000
65,000
75,000
83,000
62,000
Total remuneration
1,059,000
1,180,000
1,237,000
1,286,000
1,301,000
The remuneration for the Managing Board is described in section 15.34.1 ‘Specification of administrative
expenses’. The Managing Board employed on average 4 employees (2024: 4 employees). The managing
directors of the Managing Board are employed by Arcona Capital Nederland N.V. (1), Arcona Capital Fund
Management B.V. (2) and Arcona Capital GmbH (1). The total number of employees involved in the
activities of the Fund is 7 (2024: 7). The Managing Board of the Fund receives a fixed management fee,
described in the prospectus of the Fund. The percentage of the total remuneration of the Fund Managing
Board that comes from the Fund is 79.28%. Part of the fixed management fee is paid as asset management
fee to Arcona Capital Czech Republic; since 2017, it has been paid to Arcona Capital Poland, and since
2019, to Secure Management.
People in senior management functions with the Managing Board are seen as identified staff. Identified staff
are defined as follows:
•
Managing directors of the Managing Board; and
•
Employees fronting administration, portfolio management, marketing and human resources.
No employees received (according to article 1:120 Wft) a remuneration exceeding EUR 500,000. The
Managing Board comprises three men and one woman. During 2025 the Fund did not employ any staff
directly (2024: 0). The identified staff is represented by a Managing Director of Arcona Capital Nederland
N.V. and its parent company, Arcona Capital GmbH. This director is not a policy maker of the Managing
Board.
Table 21 – Taxable wages
Employees
Fixed
Variable
Total
in €
in %
in €
in %
in €
Management
4
485,156
98.2
8,809
1.8
493,964
Identified staff
1
178,469
100.0
0
0.0
178,469
Other staff members
2
110,380
96.1
4,438
3.9
114,818
Total
7
774,005
98.3
13,246
1.7
787,251
Table 22 – Taxable wages per management board member
Fixed
Variable
Total
in €
in %
in €
in %
in €
G.St.J. Barker
210,792
100
0
0
210,792
P.H.J. Mars
135,689
97,5
3,491
2,5
139,18
M. Blokland-Verheem
68,688
96,3
2,633
3,7
71,321
M. van der Laan
69,987
96,3
2,685
3,7
72,672
Total
485,156
98,2
8,809
1,8
493,965
Remuneration for the Supervisory Board for the period 2025
–
2021
The Supervisory Board received a total remuneration of EUR 23,000 (2024: EUR 28,000) in 2025.
37
Table 23 – Supervisory board remuneration per year
All in EUR
2025
2024
2023
2022
2021
Supervisory Board
23,000
28,000
28,000
35,000
35,000
The Managing Board´s management contract with the Fund is described in the prospectus of the Fund and
determines the annual level of management fee. The Supervisory Board is therefore not required to issue
a remuneration report under the remuneration policy. The Supervisory Board monitors that the fees paid
are in accordance with these contractual arrangements. An adjustment of the remuneration can only be
implemented if approved by the General Meeting of Shareholders.
The remuneration for the Supervisory Board and the remuneration for the statutory directors are described
in section 15.35.3 Analysis of Supervisory Board fees and 15.35.4 Analysis of other operating expenses.
Rules on appointment and replacement of board members
According to the Articles of Association (Articles 18 and 23) and under the oversight of the Priority share
foundation, board members are appointed through a structured process. The Foundation identifies qualified
candidates in line with the board regulations, and the proposed appointments are approved by the general
meeting. Vacancies are filled using a similar evaluation process, with all decisions transparently recorded.
CORPORATE GOVERNANCE
As a listed investment company, the Fund is not formally required to fully apply the Dutch Corporate
Governance Code. However, the Managing Board and Supervisory Board consider its principles of
transparency and accountability highly relevant and aim to apply them wherever possible in the Fund's
operations.
Capital structure
The Fund's share capital consists of 3,962,436 ordinary shares, and one priority share. Treasury shares
carry no voting or dividend rights (see 19.9.6 Treasury shares). Registered shares are restricted from
trading related to their listing on Euronext Fund Services (EFS) in Amsterdam and the Prague Stock
Exchange (PSE). There are no other restrictions with regard to registered shares (see 19.9.4 Registered
shares). Further details on the capital structure, including the number of shares, are provided in the financial
statements (sections 19.9 Issued capital and 20.4 Special controlling rights).
Transfer of shares
There are no restrictions on the transfer of ordinary shares. Registered shares, however, are subject to
certain limitations, as explained in the financial statements (section 19.9.4 Registered shares).
Significant shareholders
The Fund's significant direct and indirect shareholders are disclosed in the financial statements (see 15.44.3
Specification major investors), including holdings exceeding 5% of the share capital.
Special controlling rights
The priority share grants special rights, including the authority to nominate members of the Managing Board
and members of the Supervisory Board. These rights are detailed in the financial statements (sections
19.9.8 Priority shares and 20.4 Special controlling rights).
Employee share schemes
The Fund has no employee share schemes in place.
Voting rights
There are no voting restrictions, except that treasury shares have no voting rights. Voting procedures and
deadlines are set out in the Fund’s articles of association.
38
Shareholder agreements
The Fund is not aware of any agreements between shareholders that could affect control of the Fund.
Board powers on share issuance and buybacks
The Managing Board (ACFM) is authorised to issue and repurchase shares, as described in Article 7 of the
articles of association, subject to the role of the Priority share foundation.
Change of Control Agreements
There are no agreements in place that would take effect upon a change of control following a public takeover
bid.
5.7
STATEMENT REGARDING ADMINISTRATIVE ORGANISATION AND INTERNAL CONTROL
The Managing Board has reviewed all elements of the administrative organization during the reporting
period. We consider that the administrative organization and internal control as prescribed by Article 121 of
the
Bgfo
(Besluit gedragstoezicht financiële ondernemingen), meet the requirements prescribed by the Wft
and related regulations. Pursuant to this, we declare as the Managing Board of the Fund that the Company
possesses a description as prescribed by Article 121 of the Bgfo, which meets the requirements as
prescribed by the Bgfo. In addition, the Managing Board declares with a reasonable degree of certainty that
the administrative organization and internal control function effectively and in accordance with this
description.
Amsterdam, April 30, 2026
The Managing Board:
Arcona Capital Fund Management B.V.
On behalf of,
G.St.J. Barker LLB
P.H.J. Mars M.Sc
M. Van der Laan B.Sc
M.T.H. Blokland BBA
Managing director
Managing director
Managing director
Managing director
39
6
THE
REAL
ESTATE
PORTFOLIO
As of December 31, 2025, the Fund's real estate portfolio encompasses sixteen properties across four
Central European countries.
6.1
POLAND
As of December 31, 2025, the Fund's Polish portfolio consists of nine retail centres situated in regional cities
and one modern office building located in Szczecin. All properties are multi-tenanted. Key details of each
property are summarized below:
40
8 Laubitza, Inowrocław
Type
Retail
Rentable Surface (in sqm)
1,781
Occupation Rate
(in %)
95.6
Fair value
(in EUR)
1,940,000
The property is located in Inowrocław, within Stare Miasto district, at 8 Laubitza
Street, close to Dworcowa Street. The area is mostly commercial in nature. The
retail building, completed in 2001, comprises one floor above ground of 1,765 sqm
of total lettable area and 41 parking spaces situated at the east, south and west
sides of the property. In April 2023, Rossmann signed a 5-year lease for 459 square
meters, and started to operate in August 2023.
800-lecia Inowrocławia 27, Inowrocław
Type
Retail
Rentable Surface (in sqm)
2,366
Occupation Rate
(in %)
86.4
Fair value
(in EUR)
2,420,000
Inowrocław is located in the central part of Poland near to Bydgoszcz and Toruń.
The city has approximately 75,000 inhabitants. The site is located on the south-
eastern edge of the city, in a residential area comprising apartment blocks and
single-family houses. The immediate area is served by seven bus lines providing
convenient access to the property for customers using public transport. The centre
provides 2,366 sqm lettable area and 100 parking places. In June 2022, Carrefour
signed a seven-year lease for 1,430 square meters (rentable area 1,268), under
enhanced rental terms. The new supermarket opened its doors in early August
2022.
1 Krzemowa, Gdańsk
Type
Retail
Rentable Surface (in sqm)
1,622
Occupation Rate
(in %)
100.0
Fair value
(in EUR)
3,260,000
The Gdańsk–Sopot-Gdynia (750,000 inhabitants) conurbation (TriCity) is located in
the northern part of Poland, on the Baltic coast. The property is situated in the
southern part of Gdańsk, within the city’s most densely populated district, Chełm
(50,000 inhabitants). To the north-east it borders the Śródmieście district, home of
the medieval old town. Surrounded by multifamily residential buildings, the property
benefits from high volumes of passing traffic, with Gdańsk’s city centre reachable
by car within less than 10 minutes. The site has two entry points, provides 46 parking
spaces and extends to 5,122 sqm. The main tenant is Biedronka, on a lease expiring
in 2027.
41
1 Plutona, Głogów
(Plutona
Type
Retail
Rentable Surface (in sqm)
1,669
Occupation Rate
(in %)
89.6
Fair value
(in EUR)
2,000,000
Głogów is a developing medium-sized town in the south-east part of Poland, with a
current population of nearly 70,000. The property is located in the city’s largest
housing estate, Kopernik, with a population of 22,500. High-rise residential buildings
dominate the property’s direct surroundings. The lettable area is 1,669 sqm and
there are 62 parking places. Anchor tenant in this location is Polo Market with a
lease agreement expiring in 2030.
82 Kalinkowa, Grudziądz
Type
Retail
Rentable Surface (in sqm)
2,556
Occupation Rate
(in %)
100.0
Fair value
(in EUR)
2,790,000
Grudziądz is a city with nearly 100,000 inhabitants, located in the north of Poland.
The property is located in the south-western part of Grudziądz in a densely
populated residential area. It is bordered by the Strzemięcin housing estate with its
12-storey blocks of flats to the north and the Kopernika housing estate with its
medium-density dwellings to the north-east. The site size is 8,932 sqm and is
predominantly held freehold. The parking area overall has 126 parking places.
137 Wojska Polskiego, Piotrków Trybunalski
(Wajska)
Type
Retail
Rentable Surface (in sqm)
2,603
Occupation Rate
(in %)
91.8
Fair value
(in EUR)
3,210,000
Piotrków Trybunalski is located in the central part of Poland near to Łódź. The city
has approximately 75,000 inhabitants. The city’s main competitive advantage is its
location in central Poland on the main transport artery providing fast connections to
the country’s major towns and cities. With recent improvements in the national road
and transport infrastructure the city has become one of the most important
distribution locations in Poland. The property is located on Wojska Polskiego Street,
the main road connecting Piotrków city centre with the north-western peripheries.
Its neighbourhood comprises residential areas to the north and business facilities to
the south. Because of its prominent location on the main road and its distinctive
signage, the retail centre is highly visible. Extensive new residential developments
were developed adjoining the site to north-west which increased the centre’s
catchment area. The property has 95 parking places. The main tenant is Biedronka,
expiring in 2028.
42
6 Wolnosci, Słupsk - held-for-sale
Wajska)
Type
Retail
Rentable Surface (in sqm)
1,831
Occupation Rate
(in %)
98.4
Fair value
(in EUR)
2,270,000
Słupsk is an historic town in north-western Poland, located just 18 km away from
Ustka, a popular seaside resort on the Baltic coast. The current population is 95,000
inhabitants. The property is located in the northern part of the city and its immediate
surroundings comprise high density mid-rise residential developments. In year 2022
next to Wolności site stand alone Biedronka shop was built – which increased
pedestrian traffic near the property. The Old Town is within 10-minutes’ walk. Two
bus stops are located directly in front of the property with several others within
walking distance. The property has 48 parking places.
216 Legionów St., Toruń – held-for-sale
()
Type
Retail
Rentable Surface (in sqm)
2,229
Occupation Rate
(in %)
100.0
Fair value
(in EUR)
3,140,000
This single-storey retail building, completed in 2001, comprises 2,229 sqm of total
lettable area and 64 parking spaces. The property is located in Toruń, Koniuchy
district, at 216 Legionów St., close to Wielki Rów St. The area is predominantly
residential in nature. There is direct access to the building from Legionów and
Kozacka Sts. Car parking is located from the north (Wielki Rów St.), west (Legionów
St.) and south sides of the property and consists of 64 over ground car spaces.
Public transport is secured with 2 bus lines that have stops at Wielki Rów St. and 4
bus lines that have stops at Legionów St. The site of the property is held leasehold.
20 Grzymały Siedleckiego St., Bydgoszcz – under legal claim
Type
Retail
Rentable Surface (in sqm)
1,793
Occupation Rate
(in %)
100.0
Fair value
(in EUR)
1,380,000
This single-storey retail building, completed in 2001, comprises 1,793 sqm of total
lettable area and 64 parking spaces. The subject property is located in the capital
of kujawsko-pomorskie voivodeship and ca. 3 km away from the Old Town, on the
same side of the Brda River. The surroundings of the property are dominated by
multifamily residential development and services. The nearest bus and tram stops
are located at Wojska Polskiego Street at a distance of approx. 300 m and are
serviced by 4 bus lines (including a night one) and 3 tram lines. The site of the
property is held leasehold.
43
107 Kardynala Wyszynskiego St., Łódź - held-for-sale
Type
Retail
Rentable Surface (in sqm)
1,608
Occupation Rate
(in %)
77.1
Fair value
(in EUR)
1,730,000
This single-storey retail building, completed in 2001, provides 1,608 sqm of total
lettable area and 60 parking spaces situated in the north and east sides of the
property. The property is located in Łódź, Polesie District, at 107 Kardynała
Wyszyńskiego St., close to Popiełuszki St. The area is predominantly residential in
nature. Public transport is secured with 7 bus lines that have stops to the west of
the property. The main tenant is Netto, on a lease expiring in 2033. The site of the
property is held leasehold.
9 Holdu Pruskiego Square, Szczecin - held-for-sale
( (
Type
Office
Rentable Surface (in sqm)
5,945
Occupation Rate
(in %)
87.5
Fair value
(in EUR)
9,260,000
This office building, completed in 2005, comprises six floors above ground and three
underground levels (with 119 parking spaces) and is located in the city centre
opposite Szczecin´s iconic new concert hall. The total rentable area is 5,945 sqm.
The property is currently multi-leased, with 11 tenants. The main tenant is Intive.
44
6.2
CZECHIA
The portfolio comprises one commercial property located in Prague, the capital city. The main
characteristics of the property is summarised below.
Politických vězňů 10, Prague 1
Type
Office
Rentable Surface (in sqm)
2,308
Occupation Rate
(in %)
79.1
Fair value
(in EUR)
7,389,000
This representative office building is located in Prague’s city centre, near Wenceslas
Square. The main building has eight floors and the total rentable space is 2,308
sqm. The property is underdoing a redevelopment to create several small
appartments on the back of the property. The property is close to the Wilsonova
arterial road through Prague city centre and within 5 minutes’ walk of the central
railway station.
45
6.3
ROMANIA
The Fund´s portfolio includes two office properties in Bucharest, Romania. The main characteristics of the
properties are summarised below:
EOS office, Bucharest
Type
Office
Rentable Surface (in sqm)
3,386
Occupation Rate
(in %)
0.0
Fair value
(in EUR)
3,272,000
The office building completed in June 2008 has a total gross lettable area (
GLA
) of
3,386 sq m and 90 exterior parking places. The EOS office Building is located in the
North-Eastern part of Bucharest 900 metres north of Fundeni Road, a major artery
within that particular area of the city. The neighbouring area comprises a mix between
light industrial (food processing and logistics) and residential use. The property is
100% empty. Danone has vacated the property in the first half of 2025.
Delenco office, Bucharest (Fund has 24.35% ownership)
Type
Office
Rentable Surface (in sqm)
10,384 (of which 711 sqm retail)
Occupation Rate
(in %)
87.0
Fair value
(in EUR)
15,990,000
a 24.35% stake is :
3,894,000
The property is a multi-storey office building in central Bucharest, completed in June
2008.The DELENCO Building has a GLA of 10,384 sq m with 2 UG levels, lobby and
retail space on the ground floor and offices on upper floors. The property has different
height levels, from 7 upper floors in the north wing facing Calea Calarasilor to 9 partial
floors in the main wing, facing Delea Noua, and 10 floors in the wing facing Matei
Basarab St. The main tenant is ANCOM, the National Authority for Management and
Regulation in Communications of Romania.
46
6.4
UKRAINE
The Fund´s portfolio includes three land plots located in Ukraine, in the cities of Kiev, Odessa and
Zaporizhzhia. The main characteristics of the properties are briefly summarised below:
Nerubaiske Village, Odessa
(Biliayivskyi
Type
Land plot
Surface area
(in sqm)
223,934
Occupation Rate
(in %)
n/a
Fair value
(in EUR)
1,044,000
The land plot fronts the Odessa-Kiev M-05 Highway, a six-lane strategic road with
high levels of freight traffic connecting Ukraine´s capital city with its largest seaport.
The land plot is approximately 7.5 km from the Odessa Ring Road and 1.8 km from
the nearest motorway exit. The immediate neighbourhood is developing as a logistics
and industrial hub for Odessa, with two major schemes, the established temperature-
controlled complex ‘Inrise Logistics Park’ and the newly built ‘Odessa Logistics Park’
already in operation. The plot has been prepared for warehouse construction with
extensive foundation works already completed. The Fund´s business plan for the
project is to update the development documentation and planning and then to sell to
a local or international warehouse developer.
Balabynska Village, Zaporizhzhia
Biliayivskyi
Type
Land plot
Surface area
(in sqm)
263,834
Occupation Rate
(in %)
n/a
Fair value
(in EUR)
0
This very large land plot is located about 2 km to the south of the city of Zaporizhzhia
and borders the M105 highway from Kharkov to Mariupol. The site is zoned for
commercial use and offers potential for retail park or shopping centre development.
47
Kyianovski Lane, Kyiv – new acquisition
Biliayivskyi
Type
Land plot
Surface area
(in sqm)
5,400
Occupation Rate
(in %)
n/a
Fair value
(in EUR)
2,230,000
The landplot is a 0.54-hectare site in the city centre of Kyiv. The site, on Kyianovski
Lane in the Shevchenkivskyi district, is 500 meters from Lvivska Square and suitable
for high-end residential development. This acquisition completes the purchase
programme from SPDI, originally agreed in 2020.
48
7
PERFORMANCE
INDICATORS
The (diluted) adjusted earnings is a performance indicator introduced by the Managing Board. There are no
prescribed rules for such performance indicators, meaning that each company develops its own policy and
applies it consistently. Thus, performance indicators with the same name can be determined in a different
manner.
7.1.1
(Adjusted) earnings
Earnings reported in the Consolidated Income Statement, while compliant with IFRS, may not offer
shareholders the most relevant insight into the operating performance of real estate investment funds.
The earnings is a measure of the underlying performance of an investment property. The Fund’s operational
performance represents the net income generated from the operational activities. Unrealised changes in
valuation of properties, gains or losses on disposals of properties and certain “exceptional” items do not
necessarily provide an accurate picture of the Fund’s underlying operational performance.
As earnings are used to measure the operational performance, it excludes all components not relevant to the
underlying net income performance of the portfolio, such as net results on properties. In effect, what is left as
earnings is the income return generated by the investment, rather than the change in value or capital return
on investments.
Besides the Managing Board exclude “exceptional” items that are part of IFRS earnings such as several “one-
off costs” and “one-off revenues”, as well as interest expense on lease liabilities.
The operating leases are included in the calculation of the (diluted) adjusted earnings according to APM. As a
result of above-described adjustments the impact of applying IFRS 16 (e.g. fair value adjustments right-of-use
assets (held for sale) and interest expense on lease liabilities) are eliminated in the (diluted) adjusted earnings.
Adjusted earnings per share
1
should be calculated on the basis of the basic number of profit-sharing shares.
The main reason for this is that earnings and the dividends to which they give rise accrue to current
shareholders and therefore it is more appropriate to use the basic number of profit-sharing shares.
The diluted adjusted earnings per share should be calculated on a diluted basis considering the impact of any
options, convertibles, etcetera that are dilutive. For the explanation of the effect of exercise of options,
convertibles, and other equity interests (fully diluted basis) reference is made to the explanation in (3),
mentioned in section 7.1.6 “Explanation of adjustments calculation of NAV”.
1
The adjusted earnings per share includes all types of profit-sharing shares (e.g., ordinary and registered shares). Therefore, treasury
shares are excluded from the adjusted earnings per share.
49
7.1.2
Calculation of (diluted) adjusted earnings per share
Notes
2025
2024
In € 1,000
In € 1,000
Earnings per IFRS Consolidated Income Statement
9
-/- 4,345
-/- 32
Exclude:
1.
Net results on properties
15.30
5,415
827
2.
Net results on equity investments
15.31
-/- 266
-/- 80
3. Financial income:
15.32
a.
realised currency results on net investments in
group companies
-/- 259
-/- 638
4.
Other operating income:
15.33
a.
penalties for early termination of rental contracts
-/- 195
-/- 5
b.
reimbursement from tenants
-/- 70
-
c.
compensation for non-contractual use of the
premises
-/- 9
-
5.
Other operating expenses:
15.35
a. court fees
26
68
b.
Steering Committee fees
25
47
c.
costs of funding and acquisitions
17
182
6. Financial expenses:
15.37
a.
changes in fair value of financial instruments
101
173
b.
interest expense on lease liabilities
95
99
c.
foreign exchange and currency losses
65
62
d.
variable compensation on other long-term liabilities
-
29
e.
fee for early repayment loans and borrowings
17
14
f.
waiver fee loans and borrowings
-
2
Include:
7. Operating leases
15.15.5 /
15.20.1
-/- 192
-/- 264
Subtotal adjustments (before taxes)
4,770
516
8.
Taxes in respect of above adjustments
-/- 868
-/- 234
Total adjustments
3,902
282
Adjusted earnings
-/- 443
250
Basic number of profit-sharing shares
19.9.1
3,962,436
3,882,965
Adjusted earnings per share (in €)
-/- 0.11
0.06
Basic number of profit-sharing shares (fully diluted)
3,962,436
3,882,965
Diluted adjusted earnings per share (in €)
-/- 0.11
0.06
50
7.1.3
Explanation of adjustments calculation of (diluted) adjusted earnings per share
1.
Net results on properties
This adjustment includes the gain or loss in the Consolidated Income Statement arising in the period from the
revaluation of properties at their fair value as well as result on disposals of properties (including costs on sale
of properties).
2.
Net results on equity investments
This adjustment includes the gain or loss in the Consolidated Income Statement arising in the period from the
revaluation of equity investments at their fair value as well as result on disposals of equity investments.
3.
Financial income
This adjustment includes one-off revenues in the Consolidated Income Statement, such as the gain on foreign
currency translation differences in case of (partial) reduction of net investment in foreign activities (release
from reserve for currency translation differences).
4.
Other operating income
This adjustment includes one-off revenues in the Consolidated Income Statement.
5.
Other operating expenses
This adjustment includes one-off costs in the Consolidated Income Statement.
6.
Financial expenses
This adjustment includes one-off costs in the Consolidated Income Statement, as well as the interest expense
on lease liabilities.
7.
Operating leases
The operating leases are included in the calculation of the (diluted) adjusted earnings according to APM. As a
result of above-described adjustments the impact of applying IFRS 16 (e.g. fair value adjustments right-of-use
assets (held for sale) and interest expense on lease liabilities) are eliminated in the (diluted) adjusted earnings.
8.
Taxes in respect of adjustments
This adjustment includes the deferred taxes in the period which only relates to the above items, and which
would not crystallise until or unless the property, investment or financial instrument is sold. This would typically
include deferred tax on fair value surpluses on owned investment property and investment property under
development which could reverse on disposal of the asset. This adjustment also includes any current income
tax relating directly to the above adjustments to the extent that they are considered material.
51
Net Asset Value
Net Asset Value (
NAV
) is a key performance measure used for real estate investment funds. However, NAV
reported in the Consolidated Financial Statements under IFRS does not provide shareholders with the most
relevant information on the fair value of the assets and liabilities within an ongoing real estate investment
company with a long-term investment strategy.
The NAV measures the fair value of net assets on an ongoing, long-term basis. Assets and liabilities that are
not expected to crystallise in normal circumstances such as the fair value of derivative financial instruments
and deferred taxes on investment property, investment property under development or other non-current
investments are therefore excluded.
NAV should be calculated on a diluted basis considering the impact of any options, convertibles, etcetera that
7.1.5
Calculation of NAV
Notes
31-12-2025
31-12-2024
In € 1,000
In € 1,000
Group equity in accordance with IFRS
11
38,777
42,476
Exclude:
1.
Fair value of financial instruments
15.5
-/- 26
-/- 127
2. Deferred tax
15.6.1
377
2,315
Group equity in accordance with NAV
39,128
44,664
Total number of profit-sharing shares
19.9.1
3,962,436
3,882,965
3.
Effect of exercise of options, convertibles and other equity
interests (diluted basis)
-
-
Total number of profit-sharing shares (diluted)
3,962,436
3,882,965
NAV per profit-sharing share (in €)
9.87
11.50
7.1.6
Explanation of adjustments calculation of NAV
1.
Fair value of financial instruments
This adjustment includes the net mark-to-market adjustment to the value of financial instruments (market value
less acquisition price paid or received) which are used for hedging purposes and where the Fund has the
intention of keeping the hedge position until the end of the contractual duration. Whether the Fund has chosen
to apply hedge accounting under IFRS is irrelevant. The mark-to-market of any convertible debt is also
excluded from the net assets.
The logic for this adjustment is that, under normal circumstances, the derivative financial instruments which
property investment companies use to provide an economic hedge are held until maturity and so the theoretical
gain or loss at Statement of Financial Position’s date will not crystallise.
The above adjustments do not include (possible) foreign currency hedging instruments (fair value hedges or
net investment hedges) where the hedged item market value changes are also reflected in the Consolidated
Statement of Financial Position. The fair value of such instruments should remain in NAV to offset the
movement in the underlying investment being hedged.
52
2.
Deferred tax
This adjustment includes the recognised deferred taxes in the Consolidated Statement of Financial Position in
respect of the difference between the fair value and tax value of owned investment property, investment
property under development, or other non-current investments (including investments in group companies) as
these deferred taxes would only become payable if the assets are sold. Therefore, deferred taxes on properties
held for sale, right-of-use assets held for sale as well as on lease incentives are not excluded from NAV.
The deferred tax liability relating to the fair value of financial instruments, which would not crystallise until or
unless the financial instrument is sold, should also be added back.
3.
Effect of exercise of options, convertibles and other equity interests (diluted basis)
A convertible bond is viewed as dilutive provided that the following criteria are satisfied:
1.
the convertible bond is dilutive in accordance with IAS 33.50; and
2.
the share price as at Statement of Financial Position’s date exceeds the conversion price (“in the
money”).
7.1.7
Triple Net Asset Value
The Triple Net Asset Value (
NNNAV
) measures the Net Asset Value including fair value adjustments in respect
of all material Statement of Financial Position’s items which are not reported at their fair values as part of the
NAV.
7.1.8
Calculation of NNNAV
Notes
31-12-2025
31-12-2024
In € 1,000
In € 1,000
Group equity in accordance with NAV
7.1.5
39,128
44,664
Include:
1.
Fair value of financial instruments
15.5
26
127
2.
Fair value of deferred tax
-/- 885
-/- 2,935
3.
Minimum net expected value of claims under negotiation
-
-/- 491
Group equity in accordance with NNNAV
38,269
41,365
Total number of profit-sharing shares
19.9.1
3,962,436
3,882,965
4.
Effect of exercise of options, convertibles and other equity
interests (diluted basis)
-
-
Total number of profit-sharing shares (diluted)
3,962,436
3,882,965
NNNAV per profit-sharing share (in €)
9.66
10.65
7.1.9
Explanation of adjustments calculation of NNNAV
1.
Fair value of financial instruments
This reinstates, and is equal to, the adjustment 1, as mentioned in the calculation of NAV. The reason for
reinstating is that NNNAV approximates fair value NAV.
53
2.
Fair value of deferred tax
This adjustment includes the fair value of the deferred taxes concerning owned investment property,
investment property under development or other non-current investments (including investments in group
companies; these three items hereinafter mentioned as “non-current investments”). The deferred taxes are
calculated with regard to all taxable temporary differences with regard to the non-current investments, whether
these deferred taxes are included in the Statement of Financial Position or not. For items not included in the
Statement of Financial Position reference is made to section 13.41.3 “Deferred tax” in the Accounting
Principles Consolidated Financial Statements.
The taxable temporary difference with regard to the non-current investments is calculated by the difference
between the fair value of the non-current investment less the tax value of the non-current investment. In case
the taxable temporary difference should result in a deferred tax asset, this deferred tax asset will only be
recognised as far as it is probable that future taxable profits will be available against which they can be used.
Deferred taxes are measured at the tax rates that are expected to be applied to taxable temporary differences
when they reverse, using tax rates enacted or substantively enacted at the Statement of Financial Position’s
date. The deferred taxes are considered without applying any discount (nominal value), which is in accordance
with IFRS.
The Managing Board assessed that the fair value of the deferred taxes to non-current investments is equal to
the nominal value (similar as mentioned in the Statement of Financial Position), adjusted for unrecognised
deferred taxes of non-current investments as mentioned in section 13.40.3 “Deferred tax” in the Accounting
Principles Consolidated Financial Statements. Since a substantial portion of the assets will likely be sold in the
near future, the Managing Board is exercising prudence with regard to the recognised deferred tax assets
related to non-current investments.
3.
Minimum net expected value of claims under negotiation
This adjustment includes the difference between the carrying amount of assets as at Statement of Financial
Position’s date for which the Fund is seeking compensation through ongoing negotiations, and the minimum
net expected value of the claims under settlement discussions. This adjustment is net of tax.
4.
Effect of exercise of options, convertibles, and other equity interests (diluted basis)
For the effect of exercise of options, convertibles, and other equity interests (fully diluted basis) reference is
made to the explanation in section 7.1.6 (3) “Explanation of adjustments calculation of NAV”.
7.1.10
Calculation of NNNAV before distributions to shareholders
Notes
31-12-2025
31-12-2024
In € 1,000
In € 1,000
Group equity in accordance with NNNAV
7.1.8
38,269
41,365
Exclude:
1.
Cumulative distributions to shareholders
3,857
3,857
Group equity in accordance with NNNAV before distributions
to shareholders
42,126
45,222
Total number of profit-sharing shares
19.9.1
3,962,436
3,882,965
2.
Effect of exercise of options, convertibles, and other equity
interests (diluted basis)
-
-
Total number of profit-sharing shares (diluted)
3,962,436
3,882,965
NNNAV per profit-sharing share before distributions to
shareholders (in €)
10.63
11.65
54
7.1.11
Calculation of NNNAV after issuance of shares (share-based payments)
Notes
31-12-2025
Proforma
31-12-2024
In € 1,000
In € 1,000
Group equity in accordance with NNNAV
7.1.8
38,269
41,365
Include:
1.
Share-based payments acquisition of subsidiaries
N.a.
1,082
Group equity in accordance with NNNAV after issuance of
shares (share-based payments)
38,269
42,447
Total number of profit-sharing shares (diluted) in accordance with
NNNAV
19.9.1
3,962,436
3,882,965
2.
Effect of issuance of profit-sharing shares (share-based
payments)
N.a.
79,471
Total number of profit-sharing shares (diluted) after issuance
of shares (share-based payments)
3,962,436
3,962,436
NNNAV per profit-sharing share after issuance of shares (in €)
9.66
10.71
7.1.12
Explanation of adjustments calculation of NNNAV after issuance of shares (share-based
payments)
1.
Share-based payments acquisition of subsidiaries
This adjustment includes the final settlement of the remaining fair value of identifiable assets acquired and
liabilities assumed as at the acquisition date related to the acquisition of the 100% stake in Aisi Ukraine LLC
and the Romanian assets. This settlement was completed on February 6, 2025.
2.
Effect of issuance of profit-sharing shares (share-based payments)
This adjustment relates to the issuance of 79,471 registered shares of the Fund to SPDI as part of the final
settlement for the acquisition of the 100% stake in Aisi Ukraine LLC and the Romanian assets. This settlement
was completed on February 6, 2025.
55
FINANCIAL STATEMENTS
56
CONTENTS
FINANCIAL STATEMENTS
.............................................................................................................................
55
CONSOLIDATED FINANCIAL STATEMENTS 2025
......................................................................................
59
8
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
..................................................................................
60
9
CONSOLIDATED INCOME STATEMENT
...............................................................................................................
61
10
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
........................................................................
62
11
CONSOLIDATED STATEMENT OF CHANGES IN GROUP EQUITY
.....................................................................
63
12
CONSOLIDATED STATEMENT OF CASH FLOWS
...............................................................................................
64
13
ACCOUNTING PRINCIPLES CONSOLIDATED FINANCIAL STATEMENTS
.........................................................
65
13.1
REPORTING ENTITY
............................................................................................................................................
65
13.2
STATEMENT OF COMPLIANCE AND FUTURE RELATED ASSUMPTIONS
......................................................
65
13.3
SUMMARY OF SIGNIFICANT ACCOUNTING PRINCIPLES
................................................................................
66
13.4
CHANGE (OF PRESENTATION) OF COMPARATIVE FIGURES
.........................................................................
66
13.5
BASIS OF PREPARATION OF THE CONSOLIDATED FINANCIAL STATEMENTS
............................................
66
13.6
BASIS OF CONSOLIDATION
................................................................................................................................
69
13.7
BASIS OF PREPARATION OF CONSOLIDATED STATEMENT OF CASH FLOWS
............................................
70
13.8
CURRENCY
...........................................................................................................................................................
71
13.9
FINANCIAL INSTRUMENTS
..................................................................................................................................
72
13.10 INVESTMENT PROPERTY
...................................................................................................................................
77
13.11 INVESTMENT PROPERTY UNDER DEVELOPMENT
..........................................................................................
80
13.12 INVESTMENTS IN ASSOCIATES
.........................................................................................................................
81
13.13 DERIVATIVE FINANCIAL INSTRUMENTS
...........................................................................................................
81
13.14 DEFERRED TAX ASSETS
....................................................................................................................................
81
13.15 TAX ASSETS
.........................................................................................................................................................
81
13.16 TRADE AND OTHER RECEIVABLES
...................................................................................................................
81
13.17 PREPAYMENTS AND DEFERRED EXPENSES
...................................................................................................
81
13.18 CASH AND CASH EQUIVALENTS
........................................................................................................................
82
13.19 ASSETS HELD FOR SALE
....................................................................................................................................
82
13.20 GROUP EQUITY
....................................................................................................................................................
82
13.21 TAX LIABILITIES
....................................................................................................................................................
82
13.22 LOANS AND BORROWINGS
................................................................................................................................
83
13.23 TRADE AND OTHER PAYABLES
.........................................................................................................................
83
13.24 DEFERRED INCOME AND TENANT DEPOSITS
.................................................................................................
83
13.25 DEFERRED TAX LIABILITIES
...............................................................................................................................
83
13.26 PROVISIONS
.........................................................................................................................................................
83
13.27 CONTRACT ASSETS
............................................................................................................................................
84
13.28 GROSS RENTAL INCOME
....................................................................................................................................
84
13.29 SERVICE CHARGE INCOME AND SERVICE CHARGE EXPENSES
..................................................................
84
13.30 PROPERTY OPERATING EXPENSES
.................................................................................................................
85
13.31 VALUATION RESULTS OF PROPERTIES
...........................................................................................................
85
13.32 RESULT ON DISPOSALS OF PROPERTIES
........................................................................................................
85
13.33 (REVERSAL OF) IMPAIRMENT ALLOWANCE OF INVENTORIES
......................................................................
85
13.34 RESULT ON DISPOSALS OF INVENTORIES
......................................................................................................
85
13.35 SHARE IN RESULTS OF INVESTMENTS IN ASSOCIATES
................................................................................
85
13.36 RESULT ON DISPOSALS OF INVESTMENTS IN ASSOCIATES
.........................................................................
85
13.37 FINANCIAL INCOME
.............................................................................................................................................
86
13.38 OTHER OPERATING INCOME
.............................................................................................................................
86
57
13.39 LEASES
.................................................................................................................................................................
86
13.40 ADMINISTRATIVE EXPENSES AND OTHER OPERATING EXPENSES
.............................................................
88
13.41 FINANCIAL EXPENSES
........................................................................................................................................
88
13.42 INCOME TAX EXPENSE
.......................................................................................................................................
88
14
SEGMENT INFORMATION
.....................................................................................................................................
90
14.1
GENERAL
..............................................................................................................................................................
90
14.2
GEOGRAPHIC CATEGORIES
...............................................................................................................................
90
14.3
BUSINESS CATEGORIES
.....................................................................................................................................
90
14.4
CRITERIA OF GEOGRAPHIC AND BUSINESS CATEGORIES
...........................................................................
91
14.5
SEGMENT RESULTS
............................................................................................................................................
92
15
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
.............................................................................
97
15.1
SUBSIDIARIES
......................................................................................................................................................
97
15.2
INVESTMENT PROPERTY
...................................................................................................................................
98
15.3
INVESTMENT PROPERTY UNDER DEVELOPMENT
........................................................................................
102
15.4
INVESTMENTS IN ASSOCIATES
.......................................................................................................................
103
15.5
DERIVATIVE FINANCIAL INSTRUMENTS
.........................................................................................................
104
15.6
RECOGNISED DEFERRED TAXES
....................................................................................................................
105
15.7
UNRECOGNISED DEFERRED TAXES
...............................................................................................................
107
15.8
TAX ASSETS
.......................................................................................................................................................
108
15.9
TRADE AND OTHER RECEIVABLES
.................................................................................................................
109
15.10 PREPAYMENTS AND DEFERRED EXPENSES
.................................................................................................
112
15.11 CASH AND CASH EQUIVALENTS
......................................................................................................................
113
15.12 ASSETS HELD FOR SALE
..................................................................................................................................
113
15.13 GROUP EQUITY
..................................................................................................................................................
117
15.14 TAX LIABILITIES
..................................................................................................................................................
118
15.15 LOANS AND BORROWINGS
..............................................................................................................................
118
15.16 TRADE AND OTHER PAYABLES
.......................................................................................................................
124
15.17 DEFERRED INCOME AND TENANT DEPOSITS
...............................................................................................
124
15.18 PROVISIONS
.......................................................................................................................................................
125
15.19 DEFERRED TAX LIABILITIES
.............................................................................................................................
125
15.20 LIABILITIES DIRECTLY ASSOCIATED WITH ASSETS HELD FOR SALE
........................................................
125
15.21 CONTINGENT ASSETS
......................................................................................................................................
126
15.22 NON-CONTINGENT ASSETS
.............................................................................................................................
126
15.23 CONTINGENT LIABILITIES
.................................................................................................................................
126
15.24 NON-CONTINGENT LIABILITIES
........................................................................................................................
128
15.25 GROSS RENTAL INCOME
..................................................................................................................................
128
15.26 REBILLED AND NON-REBILLED SERVICE CHARGES AND PROPERTY OPERATING EXPENSES
.............
129
15.27 VALUATION RESULTS OF PROPERTIES
.........................................................................................................
130
15.28 RESULT ON DISPOSALS OF PROPERTIES
......................................................................................................
131
15.29 RESULT ON DISPOSALS OF INVENTORIES
....................................................................................................
131
15.30 NET RESULTS ON PROPERTIES
......................................................................................................................
132
15.31 SHARE IN RESULTS OF INVESTMENTS IN ASSOCIATES
..............................................................................
132
15.32 FINANCIAL INCOME
...........................................................................................................................................
133
15.33 OTHER OPERATING INCOME
...........................................................................................................................
133
15.34 ADMINISTRATIVE EXPENSES
...........................................................................................................................
133
15.35 OTHER OPERATING EXPENSES
......................................................................................................................
136
15.36 PERSONNEL COSTS
..........................................................................................................................................
139
15.37 FINANCIAL EXPENSES
......................................................................................................................................
139
15.38 ONGOING CHARGES FIGURE
...........................................................................................................................
139
15.39 INCOME TAX EXPENSE
.....................................................................................................................................
142
15.40 EARNINGS PER SHARE23F
...............................................................................................................................
144
15.41 RISK MANAGEMENT
..........................................................................................................................................
146
15.42 DISCLOSURES LEASES
.....................................................................................................................................
159
15.43 DISCLOSURES CONSOLIDATED STATEMENT OF CASH FLOWS
.................................................................
160
15.44 RELATED PARTIES
............................................................................................................................................
161
15.45 EVENTS AFTER STATEMENT OF FINANCIAL POSITION’S DATE
..................................................................
165
58
PARENT COMPANY FINANCIAL STATEMENTS 2025
................................................................................................
166
16
PARENT COMPANY BALANCE SHEET
..............................................................................................................
167
17
PARENT COMPANY PROFIT AND LOSS ACCOUNT
.........................................................................................
168
18
ACCOUNTING PRINCIPLES PARENT COMPANY FINANCIAL STATEMENTS
................................................
169
18.1
GENERAL
............................................................................................................................................................
169
18.2
SUMMARY OF SIGNIFICANT ACCOUNTING PRINCIPLES
..............................................................................
169
18.3
BASIS OF PREPARATION OF THE PARENT COMPANY FINANCIAL STATEMENTS
.....................................
169
18.4
SIZE AND COMPOSITION OF THE EQUITY AND RESULTS IN THE CONSOLIDATED AND PARENT
COMPANY FINANCIAL STATEMENTS
..........................................................................................................................
171
19
NOTES TO THE PARENT COMPANY FINANCIAL STATEMENTS
....................................................................
172
19.1
INVESTMENTS IN GROUP COMPANIES
...........................................................................................................
172
19.2
RECEIVABLES FROM GROUP COMPANIES
....................................................................................................
173
19.3
OTHER RECEIVABLES
.......................................................................................................................................
173
19.4
DEFERRED EXPENSES
.....................................................................................................................................
174
19.5
RECOGNISED DEFERRED TAXES
....................................................................................................................
175
19.6
UNRECOGNISED DEFERRED TAXES
...............................................................................................................
176
19.7
CASH AT BANK
...................................................................................................................................................
176
19.8
SHAREHOLDERS’ EQUITY
................................................................................................................................
177
19.9
ISSUED CAPITAL
................................................................................................................................................
178
19.10 SHARE PREMIUM
...............................................................................................................................................
180
19.11 DEFERRED TAX LIABILITIES
.............................................................................................................................
180
19.12 PRIVATE LOANS
.................................................................................................................................................
181
19.13 DEBTS TO GROUP COMPANIES
.......................................................................................................................
181
19.14 TAX LIABILITIES
..................................................................................................................................................
183
19.15 OTHER LIABILITIES
............................................................................................................................................
183
19.16 ACCRUALS
..........................................................................................................................................................
183
19.17 NON-CONTINGENT LIABILITIES
........................................................................................................................
184
19.18 CONTINGENT LIABILITIES
.................................................................................................................................
184
19.19 INCOME FROM INVESTMENTS
.........................................................................................................................
184
19.20 REALISED VALUATION RESULTS OF INVESTMENTS IN GROUP COMPANIES
...........................................
184
19.21 REALISED VALUATION RESULTS OF RECEIVABLES FROM GROUP COMPANIES
.....................................
185
19.22 UNREALISED VALUATION RESULTS OF INVESTMENTS IN GROUP COMPANIES
......................................
185
19.23 UNREALISED VALUATION RESULTS OF RECEIVABLES FROM GROUP COMPANIES
................................
186
19.24 OTHER OPERATING INCOME
...........................................................................................................................
186
19.25 ADMINISTRATIVE EXPENSES
...........................................................................................................................
186
19.26 OTHER OPERATING EXPENSES
......................................................................................................................
186
19.27 PERSONNEL COSTS
..........................................................................................................................................
187
19.28 INTEREST EXPENSES
.......................................................................................................................................
188
19.29 INCOME TAX EXPENSE
.....................................................................................................................................
188
19.30 RELATED PARTIES
............................................................................................................................................
189
19.31 PROPOSAL FOR THE PARENT COMPANY RESULT APPROPRIATION
.........................................................
189
19.32 DETERMINING OF PARENT COMPANY RESULT FOR THE PREVIOUS FINANCIAL PERIOD
......................
189
19.33 EVENTS AFTER BALANCE SHEET DATE
.........................................................................................................
190
20
OTHER INFORMATION
........................................................................................................................................
191
20.1
GENERAL PROVISIONS OF ARTICLES OF ASSOCIATION CONCERNING RESULT APPROPRIATION
......
191
20.2
DECREE ON THE DUTCH ACT ON FINANCIAL SUPERVISION
.......................................................................
191
20.3
PERSONAL INTERESTS
.....................................................................................................................................
191
20.4
SPECIAL CONTROLLING RIGHTS
.....................................................................................................................
192
20.5
INDEPENDENT AUDITOR’S REPORT
...............................................................................................................
193
59
CONSOLIDATED FINANCIAL STATEMENTS 2025
60
8
CONSOLIDATED
STATEMENT
OF
FINANCIAL
POSITION
Notes
31-12-2025
31-12-2024
In € 1,000
In € 1,000
Assets
Investment property
15.2
Investment property under development
15.3
Investments in associates
15.4
Derivative financial instruments
15.5
Deferred tax assets
15.6
Trade and other receivables
15.9
Prepayments and deferred expenses
15.10
Total non-current assets
Derivative financial instruments
15.5
Tax assets
15.8
Trade and other receivables
15.9
Prepayments and deferred expenses
15.10
Cash and cash equivalents
15.11
Assets held for sale
15.12
Total current assets
Total assets
Group equity
(attributable to Parent Company shareholders)
11
Liabilities
Loans and borrowings
15.15
Trade and other payables
15.16
Deferred income and tenant deposits
15.17
Deferred tax liabilities
15.19
Total non-current liabilities
Tax liabilities
15.14
Loans and borrowings
15.15
Trade and other payables
15.16
Deferred income and tenant deposits
15.17
Liabilities directly associated with assets held for sale
15.20
Total current liabilities
Total liabilities
Total Group equity and liabilities
61
9
CONSOLIDATED
INCOME
STATEMENT
Notes
2025
2024
In € 1,000
In € 1,000
Gross rental income
15.25
Service charge income
15.26
Service charge expenses
15.26
-/- 2,425
-/- 2,610
Property operating expenses
15.26
-/- 1,691
-/- 1,807
Net rental and related income
Valuation results of properties
15.27
-/- 5,393
-/- 600
Result on disposals of properties
15.28
-/- 22
-/- 1,006
Result on disposals of inventories
15.29
Net results on properties
15.30
-/- 5,415
-/- 827
Share in results of investments in associates
15.31
Net results on equity investments
Financial income
15.32
Other operating income
15.33
Other income
Total income
-/- 1,222
Administrative expenses
15.34
Other operating expenses
15.35
Total operating expenses
Net operating result before financial expenses
-/- 3,152
Financial expenses
15.37
Profit / loss before income tax
-/- 4,833
-/- 20
Income tax expense
15.39
-/- 488
Profit / loss for the period
-/- 4,345
-/- 32
Profit / loss for the period attributable to:
Parent Company shareholders
-/- 4,345
-/- 32
Profit / loss for the period
-/- 4,345
-/- 32
Basic earnings per share (€)
15.40.1
-/- 1.10
-/- 0.01
Diluted earnings per share (€)
15.40.4
-/- 1.10
-/- 0.01
62
10
CONSOLIDATED
STATEMENT
OF
COMPREHENSIVE
INCOME
Notes
2025
2024
In € 1,000
In € 1,000
Profit / loss for the period
9
-/- 4,345
-/- 32
Other comprehensive income, net of tax
Items that will not be reclassified to profit or loss
Items that are or may be reclassified subsequently to
profit or loss:
Foreign exchange and currency translation differences on net
investment in group companies
-/- 436
-/- 871
Income tax on foreign exchange and currency translation
differences on net investments in group companies
-/- 435
-/- 843
Other comprehensive income for the period, net of tax
-/- 435
-/- 843
Total comprehensive income for the period
-/- 4,780
-/- 875
Total comprehensive income attributable to:
Parent Company shareholders
-/- 4,780
-/- 875
Total comprehensive income for the period
-/- 4,780
-/- 875
63
11
CONSOLIDATED
STATEMENT
OF
CHANGES
IN
GROUP
EQUITY
Issued
capital
Share
premium
Legal
revaluation
reserve
Legal
reserve
currency
translation
differences
Retained
earnings
Total
share-
holders’
equity
In € 1,000
In € 1,000
In € 1,000
In € 1,000
In € 1,000
In € 1,000
Balance as at January 1, 2025
-/- 279
-/- 5,179
Profit / loss for the period
-/- 4,345
-/- 4,345
Other comprehensive income for the
period, net of tax
-/- 435
-/- 435
Change in legal revaluation reserve
-/- 2,967
Own shares issued
Share buy-back / Reverse
Bookbuilding
2
-/- 1,470
-/- 575
Balance as at December 31, 2025
-/- 714
-/- 4,512
Balance as at January 1, 2024
-/- 4,813
Profit / loss for the period
-/- 32
-/- 32
Other comprehensive income for the
period, net of tax
-/- 843
-/- 843
Change in legal revaluation reserve
-/- 1,711
Share buy-back / Reverse
Bookbuilding
-/- 2,045
-/- 2,045
Balance as at December 31, 2024
-/- 279
-/- 5,179
2
For further information reference is made to section 15.13.4 “Share buy-back / Reverse Bookbuilding”.
64
12
CONSOLIDATED
STATEMENT
OF
CASH
FLOWS
Notes
2025
2024
In € 1,000
In € 1,000
Cash flows from operating activities
Profit / loss for the period
9
-/- 4,345
-/- 32
Adjustments for:
Net results on properties (inventories excluded)
2
F
3
Share in results of investments in associates
15.31
-/- 266
-/- 80
Financial income
15.32
-/- 372
-/- 865
Financial expenses
15.37
Income tax expense
15.39
-/- 488
Changes in:
Tax assets
-/- 11
Trade and other receivables
-/- 74
-/- 70
Prepayments and deferred expenses
-/- 22
Tax liabilities
-/- 36
Trade and other payables
Deferred income and tenant deposits
-/- 101
-/- 66
Cash generated from operating activities
Proceeds from the sale of inventories
Interest received
Interest paid
-/- 1,372
-/- 2,326
Income tax paid / income tax received
-/- 992
Net cash from / used in (-/-) operating activities
-/- 1,502
Cash flows from investing activities
Dividend from associates
Proceeds from the sale of assets held for sale
Acquisitions of / additions to owned investment properties
-/- 813
-/- 1,494
Acquisitions of / additions to assets held for sale
-/- 285
-/- 531
Net cash from / used in (-/-) investing activities
15.43.1
Cash flows from financing activities
Share buy-back / Reverse Bookbuilding (treasury shares)
-/- 40
-/- 2,005
Proceeds from (refinanced) secured bank loans
Proceeds from other long-term liabilities
Transaction costs related to loans and borrowings
-/- 18
-/- 63
Repayments of secured bank loans
-/- 3,462
-/- 9,113
Repayments of other long-term liabilities
-/- 1,050
-/- 3,984
Payments of lease liabilities
-/- 192
-/- 264
Net cash from / used in (-/-) financing activities
15.43.2
-/- 3,368
-/- 10,229
Net increase / decrease (-/-) in cash and cash equivalents
-/- 25
Cash and cash equivalents as at 1 January
15.11
Effect of exchange and currency translation result on cash
held
-/- 3
-/- 14
Cash and cash equivalents as at 31 December
15.11
3
Transaction costs and change in lease incentives excluded.
65
13
ACCOUNTING
PRINCIPLES
CONSOLIDATED
FINANCIAL
STATEMENTS
REPORTING ENTITY
The company Arcona Property Fund N.V. , hereinafter referred to as “the
Fund
”, was incorporated on
November 27, 2002 in accordance with Dutch law and is established in Amsterdam (the Netherlands
Fund obtained a listing on the Euronext Fund Services in Amsterdam on November 13, 2003 and a listing on
the Prague Stock Exchange in Prague on October 30, 2018.
The Fund is registered in Amsterdam, De Entree 55, 1101 BH and is entered in the Trade Register of the
Dutch Chamber of Commerce under number 08110094.
The Fund is a closed-end investment company with variable capital within the meaning of Article 76a of Book
2 of the Dutch Civil Code. The Fund invests in commercial real estate in Central and Eastern Europe (
CEE
The Consolidated Financial Statements have been approved by the Supervisory Board.
The Consolidated Financial Statements of the Fund for the financial period comprise the Fund and its
STATEMENT OF COMPLIANCE AND FUTURE RELATED ASSUMPTIONS
The Fund has applied the significant accounting principles as set out in sections 13.3 to 13.42. The Managing
As at December 31, 2025, Group equity of the Fund is positive. As stated in the liquidity forecast up to May
2027, the current cash position is sufficient to cover budgeted costs. This forecast considers debt service
requirements, the repayment and / or refinancing of loans and uncertainty regarding the impact of the financial
markets (reference is made to section 15.41 “Risk management” and section 15.45 “Events after Statement
of Financial Position’s date”).
Going concern
During the reporting period, the Fund’s financing position continued to strengthen, driven by both decreasing
interest rates and significant financial restructuring. This restructuring included the repayment of secured and
more expensive unsecured loans through substantial loan instalments funded by sales proceeds, as well as
refinancing initiatives, such as the replacement of the CVI loan with two investor loans. As a result, the Loan-
to-Value (LTV) ratio declined to 33.4% (2024: 39.5%) by the end of 2025, solvency improved, and the Debt
Service Coverage Ratio (DSCR) showed further enhancement. At year-end, the real estate portfolio -
excluding the 3.6% land plot component - was 96.4% income-generating.
Looking ahead, the expected proceeds from additional disposals, other assets classified as held for sale, and
potential further sales opportunities are expected to enable the full repayment of all remaining short-term
investor loans at Group level. These transactions will further strengthen liquidity and support continued
compliance with financial covenants at the subsidiary level.
Subsequent to the reporting period, in March 2026, the Fund successfully refinanced and secured the main
Hypo Noe bank loan, resulting in a longer-term and more stable financing structure. This refinancing
significantly reduces short-term refinancing risk and further supports the Fund’s financial stability.
The cumulative reduction in the Fund’s loan-to-value (LTV) ratio in recent years has enabled the Fund to meet
its financial obligations despite the elevated interest rate environment. The Managing Board believes that the
Fund will continue to meet its financial commitments, supported by gradually declining interest rates in its core
66
markets, ongoing operational cash generation, and the continued execution of the portfolio monetisation
programme.
The Managing Board expects that the real estate portfolio will continue to maintain solid occupancy levels and
generate stable rental income, excluding temporary and indirect valuation effects. In addition, cash flow is
expected to remain positive, supported by operating income and the anticipated completion of further asset
disposals in the upcoming period.
The Fund will continue to return money to shareholders in accordance with the monetization plan agreed upon
at the Extraordinary General Meeting (EGM) at the end of 2023. The ongoing sales programme will divest non-
core assets and certain core assets that have reached their short-term peak values through refurbishment or
re-letting campaigns.
concern up to mid-2027. Therefore, these Consolidated Financial Statements are prepared on the assumption
SUMMARY OF SIGNIFICANT ACCOUNTING PRINCIPLES
The Consolidated Financial Statements have been prepared in accordance with the International Financial
Reporting Standards (
IFRS
) and the interpretations thereof adopted by the International Accounting Standards
Board (
IASB
) as adopted by the European Union (hereinafter referred to as
EU-IFRS
) as well as in accordance
with Part 9 of Book 2 of the Dutch Civil Code (Titel 9, Boek 2 van het Burgerlijk Wetboek) and the Dutch Act
on Financial Supervision (Wet op het financieel toezicht, the
Wft
).
13.4
CHANGE (OF PRESENTATION) OF COMPARATIVE FIGURES
In order to align the comparative figures with the Consolidated statement of Cash Flow 2025, some items in
the comparative figures in the Consolidated Statement of Cash Flow 2025 are presented in a different way as
done in the in the Consolidated Statement of Cash Flow 2024. The following presentations in the comparative
figures are changed:
•
The “Acquisitions of subsidiaries, net of cash acquired” are reclassified to “Acquisitions of / additions
to owned investment properties” for an amount of € 970,000 negative;
•
The “Sale of subsidiaries, net of cash acquired” are reclassified to “Proceeds from the sale of
inventories” for an amount of € 1,589,000.
The above-mentioned changes above will have no impact on “Group equity” and “Profit for the period”.
BASIS OF PREPARATION OF THE CONSOLIDATED FINANCIAL STATEMENTS
13.5.1
General
The Consolidated Financial Statements have been prepared based on historical cost, except for:
•
investment property;
•
investment property under development;
•
assets held for sale;
•
derivative financial instruments;
•
investments in associates.
The accounting policies explained below have been consistently applied to the results, other gains and losses,
assets, liabilities, and cash flows of entities included in the Consolidated Financial Statements and are
consistent with those used in the prior period, with the exception of the application of new and amended IFRS’s
67
as mentioned in section 13.5.4 “New and amended IFRS Standards and interpretations that are effective for
the current period”.
13.5.1.1 Amortised cost
The amortised cost is the amount for which a financial asset or financial liability is recognised on the
Consolidated Financial Statements at initial recognition less repayments on the principal, increased or
decreased by the cumulative amortisation of the difference between that initial amount and the final maturity
amount - determined through the effective interest method - less any write-downs (directly or by forming a
provision) due to impairments or uncollectability.
13.5.1.2 Netting
Financial assets and financial liabilities are reported net in the Consolidated Financial Statements exclusively
if and to the extent:
•
a proper legal instrument is available to set-off the recognised amounts; and
•
there is a firm intention to settle on a net basis, or to realise the asset and settle the liability
simultaneously.
13.5.1.3 Definition of properties
Properties consist of (unless otherwise stated):
•
owned investment property;
•
lease incentives;
•
right-of-use assets;
•
investment property under development;
•
inventories;
•
owned investment property held for sale;
•
lease incentives held for sale;
•
right-of-use assets held for sale;
•
investment property under development held for sale.
Judgements, assumptions, and estimation uncertainties
13.5.2.1 General
Preparation of the Consolidated Financial Statements in accordance with EU-IFRS requires the Managing
Board to make judgements, estimates and assumptions that affect the application of policies and the reported
value of assets and liabilities, income and expenses. The estimates and associated assumptions have been
based on historical experience and various other factors that are believed to be reasonable under the
circumstances. The results of these estimates and assumptions form the basis of the judgements made about
carrying amounts of assets and liabilities that are not readily apparent from other sources. The actual results
may differ from these estimates.
13.5.2.2 Assumptions and estimation uncertainties
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting
estimates are recognised in the period in which the estimate is revised if the revision affects only that period
or in the period of revision and future periods if the revision affects both current and future periods.
Assumptions and estimation uncertainties made by the Managing Board that have significant risk of resulting
in significant adjustments to the carrying amounts of assets and liabilities in the current and next financial
period are:
•
fair value measurements: in estimating the fair value of an asset or liability, the Fund uses observable
market data to the extent it is available. The Fund engages external, independent appraisers to
perform the valuation. The Managing Board works closely with the external, independent appraisers
to establish the appropriate valuation techniques and inputs to the mode. For further information is
referred to section 13.10.3 and 15.12.8. For the sensitivity analysis is referred to section 15.2.9;
•
contract assets: in estimating the compensation amount due to the Fund. For further information is
68
Measurement of fair values
Several of the Fund’s accounting policies and disclosures require the measurement of fair values, for both
financial and non-financial assets and liabilities.
When measuring the fair value of an asset or a liability, the Fund uses observable market data as far as
possible. Fair values are categorized into different levels in a fair value hierarchy based on the inputs used in
the valuation techniques as follows:
•
level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities;
•
level 2: inputs other than quoted prices included in level 1 that are observable for the asset or liability,
either directly (i.e. as prices) or indirectly (i.e. derived from prices);
•
level 3: inputs for the asset or liability that are not based on observable market data (unobservable
inputs).
Further information about the assumptions made in measuring fair values is included in the following notes:
•
13.10.2 “Investment property”;
•
13.11 “Investment property under development”;
•
13.12 “Investments in associates”;
•
13.5.4
New and amended IFRS Standards and interpretations that are effective for the current
period
A number of new standards and amendments to existing standards and interpretations are effective for annual
periods beginning on or after January 1, 2025:
•
Lack of Exchangeability: “Amendments to IAS 21”.
These new standards, amendments and interpretations did not have a significant impact on the Consolidated
Financial Statements of the Fund.
13.5.5
New and amended IFRS Standards and interpretations not yet effective
A number of new standards, amendments to existing standards, and interpretations will become effective for
annual periods beginning after January 1, 2025, and earlier application its permitted. However, the Group has
not early adopted the following new or amended accounting standards in preparing these Consolidated
Financial Statements:
•
Classification and Measurement of Financial Instruments: “Amendments to IFRS 7 and IFRS 9”;
•
Presentation and Disclosure in Financial Statements: “IFRS 18”;
•
Disclosures subsidiaries without Public Accountability: “IFRS 19”.
The Managing Board expects these new standards, amendments and interpretations will not have a material
impact on the Consolidated Financial Statements of the Fund in the current or future reporting periods, or on
foreseeable future transactions, except for IFRS 18.
IFRS 18 will replace IAS 1 Presentation of Financial Statements and applies for annual reporting period
beginning on or after January 1, 2027. The new accounting standard introduces the following key new
requirements:
•
Entities are required to classify all income and expenses into 5 categories in the Consolidated Income
Statement, namely the:
-
operating;
-
investing;
-
financing;
-
discontinued operations and
-
income tax categories.
Entities are also required to present a newly defined operating profit subtotal. Entities’ net profit will
not change.
•
Management-defined performance measures (MPMs) are disclosed in a single note in the
Consolidated Financial Statements.
69
•
Enhanced guidance is provided on how to group information in the Consolidated Financial
Statements.
In addition, all entities are required to use the operating profit result subtotal as the starting point for the
Consolidated Statement of Cash Flows when presenting operating cash flows under the indirect method.
The Managing Board is still in the process of assessing the impact of the new accounting standard, including
recent developments under IFRS 18 which place greater emphasis on operating profit as a consistent starting
point for both performance reporting and cash flow analysis, particularly with respect to the structure of the
Consolidated Income Statement, the Consolidated Statement of Cash Flows and the additional disclosures
required for MPMs. The Managing Board is also assessing the impact on how information is grouped in the
Consolidated Financial Statements, including the required categorisation of income and expenses into
operating, investing and financing activities and the reduced use of aggregated line items such as “Other”,
BASIS OF CONSOLIDATION
Subsidiaries
Subsidiaries are entities over which the Fund has direct or indirect predominant control. The Fund has
predominant control if:
•
it has power over the entity;
•
it is exposed to or entitled to variable returns because of its involvement in the entity; and
•
it has the possibility of using its predominant control over the entity to influence the size of these
returns.
Every one of these three criteria must be satisfied before the Fund is deemed to have predominant control
over the entity in which it has an interest.
Subsidiaries are fully consolidated with effect from the date on which predominant control commences until
the date that control ceases.
Consolidated Financial Statements are prepared using uniform accounting policies for similar transactions.
Accounting principles of subsidiaries are consistent with the policies adopted by the Fund.
Acquisitions of subsidiaries
The Fund recognises acquisitions if IFRS 3 (revised) “Business Combinations” or IAS 40 “Investment property”
applies. Acquisitions are considered a business combination if there is an acquisition of assets, rental activities
and such a management organisation, that the acquired entity can operate as an independent company, with
the aim of generating economic results. The Fund does not necessarily consider acquisitions of properties
within a legal company as a business combination but evaluates these acquisitions individually for the above
operational characteristics.
The Fund applies the acquisition method to account for business combinations. The consideration transferred
for the acquisition of a subsidiary is the fair value of the assets transferred, the liabilities incurred to the former
owners of the acquired assets and the equity interests issued by the Fund. The consideration transferred
includes the fair value of any asset or liability resulting from a contingent consideration arrangement.
Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are
measured initially at their fair values at the acquisition date. The Fund recognises any non-controlling interest
in the acquired assets on an acquisition-by-acquisition basis, either at fair value or at the non-controlling
interest’s proportionate share of the recognised amounts of acquiree’s identifiable net assets. Acquisition-
related costs are expensed as incurred. Goodwill is the amount by which the cost of an acquired entity at first
recognition exceeds the net fair value of the identifiable assets and liabilities and contingent liabilities assumed.
Changes in the purchase price after the acquisition date do not result in recalculation or adjustment of the
goodwill. After first recognition, the goodwill is valued at costs less any cumulative impairment losses. Goodwill
is attributed to cash-generating entities and is not amortised. Goodwill is assessed for impairment annually, or
70
earlier if circumstances give cause. Negative goodwill resulting from an acquisition is recognised directly into
Income Statement.
For acquisitions of subsidiaries not meeting the definition of a business, the Fund allocates the cost between
the individual identifiable assets and liabilities assumed in the Fund based on their relative fair values at the
date of acquisition. Acquisition-related costs are capitalised. Such transactions or events do not give rise to
13.6.3
Elimination of transactions on consolidation
All intercompany receivables, payables, significant transactions and any unrealised profits and losses on
transactions within the Fund, or income or expenses from such transactions within the Fund have been
BASIS OF PREPARATION OF CONSOLIDATED STATEMENT OF CASH FLOWS
The Fund has used the indirect method for the Consolidated Statement of Cash Flows. Given the nature of
the Fund (investment company) financial income is not netted against financial expenses but presented
separately under the total income (reference is made to section 13.36 “Financial income”), so financial income
is presented in the Consolidated Statement of Cash Flows under cash flows from operating activities.
For acquisitions and / or sale of subsidiaries not meeting the definition of a business (as mentioned in section
13.6.2 “Acquisitions of subsidiaries”), the “Acquisitions of subsidiaries, net of cash acquired” and / or the “Sale
of subsidiaries, net of cash disposed of” are part of the acquisition of / additions to the kind of properties and /
or proceeds from the sale of the kind of properties.
Cash and cash equivalents as mentioned in the Consolidated Statement of Cash Flows include the Statement
of Financial Position’s item cash and cash equivalents and, if applicable bank overdrafts. Transactions without
71
CURRENCY
Functional and presentation currency
The functional currency of the Fund is the Euro (EUR or €), reflecting the fact the majority of the Fund’s
transactions are settled in Euro. The Fund has adopted the Euro as its presentation currency since the shares
of the Fund are denominated in Euro.
Foreign currency transactions
Foreign currency transactions are translated into Euros at the exchange rate applicable on the transaction
date. Assets and liabilities denominated in foreign currencies are translated into Euros at the exchange rate
applicable on the Statement of Financial Position’s date. Exchange rate differences arising from translation
are recognised in the Income Statement. Cash flows in foreign currencies are converted at the exchange rate
Financial Statements of foreign activities and net investment in foreign activities
The assets and liabilities of foreign operations and fair value adjustments arising on consolidation are
translated into Euros at the exchange rate applicable on the Statement of Financial Position’s date.
The income and expenses of foreign operations are translated into Euros at the exchange rates at the dates
of the transactions. For practical reasons, the average monthly exchange rates for the financial period are
used to approximate the exchange rates at the dates of the transactions, however only if the exchange rates
do not fluctuate significantly.
Foreign currency translation differences arising on translation of the net investment in foreign activities, and
the associated hedging transactions, are taken through the comprehensive income and are recognised in the
legal reserve currency translation differences. In case of a (part) reduction of the net investments in foreign
activities, the deferred cumulative amount recognised in the comprehensive income relating to that particular
13.8.4
Exchange rates used for the Consolidated Statement of Financial Position
31-12-2025 |
31-12-2024 |
|
Czech Koruna (EUR / CZK) |
24.23700 |
25.18500 |
% change |
3.8% |
-/- 1.9% |
Polish Zloty (EUR / PLN) |
4.22100 |
4.27500 |
% change |
1.3% |
1.5% |
Romanian Leu (EUR / RON) |
5.09680 |
4.97430 |
% change |
-/- 2.5% |
0.0% |
Ukrainian Hryvnia (EUR / UAH) |
49.85650 |
43.92660 |
% change |
-/- 13.5% |
-/- 4.1% |
US Dollar (EUR / USD) |
1.17500 |
1.03890 |
% change |
-/- 13.1% |
6.0% |
Source: European Central Bank (ECB) if available. Ukrainian Hryvnia: National Bank of Ukraine.
72
13.8.5
Average exchange rates used for the Consolidated Income Statement
2025 |
2024 |
|
Bulgarian Lev (EUR / BGN) |
N.a. |
1.95580 |
Czech Koruna (EUR / CZK) |
24.65383 |
25.15608 |
Polish Zloty (EUR / PLN) |
4.23665 |
4.30209 |
Romanian Leu (EUR / RON) |
5.04593 |
4.97528 |
Ukrainian Hryvnia (EUR / UAH) |
47.21538 |
43.57652 |
US Dollar (EUR / USD) |
1.13138 |
1.08078 |
FINANCIAL INSTRUMENTS
13.9.1
General
Financial assets and financial liabilities are recognised in the Consolidated Statement of Financial Position
when the Fund becomes a party to the contractual provisions of the instrument.
Financial assets and financial liabilities are initially measured at fair value. Transaction costs that are directly
attributable to the acquisition or issue of financial assets and financial liabilities (other than financial assets
and financial liabilities at fair value through profit or loss) are added to or deducted from the fair value of the
financial assets or financial liabilities, as appropriate, on initial recognition. Transaction costs directly
attributable to the acquisition of financial assets or financial liabilities at fair value through profit or loss are
recognised immediately in profit or loss.
Financial assets
All regular way purchases or sales of financial assets are recognised and derecognised on a trade date basis.
Regular way purchases or sales are purchases or sales of financial assets that require delivery of assets within
the time frame established by regulation or convention in the marketplace.
All recognised financial assets are measured subsequently in their entirety at either amortised cost or fair
value, depending on the classification of the financial assets.
13.9.2.1 Classification of financial assets
In accordance with IFRS 7 financial assets have been classified as follows:
I.
Debt instruments that meet the following conditions are measured subsequently at amortised cost:
•
the financial asset is held within a business model whose objective is to hold financial
assets in order to collect contractual cash flows; and
•
the contractual terms of the financial asset give rise on specified dates to cash flows that
are solely payments of principal and interest on the principal amount outstanding.
II.
Debt instruments that meet the following conditions are measured subsequently at fair value through
other comprehensive income (
FVTOCI
):
•
the financial asset is held within a business model whose objective is achieved by both
collecting contractual cash flows and selling the financial assets; and
•
the contractual terms of the financial asset give rise on specified dates to cash flows that
are solely payments of principal and interest on the principal amount outstanding.
III.
By default, all other financial assets are measured subsequently at fair value through profit or loss
(
FVTPL
).
Despite the foregoing, the Fund may make the following irrevocable election / designation at initial recognition
of a financial asset:
•
the Fund may irrevocably elect to present subsequent changes in fair value of an equity investment
in other comprehensive income if certain criteria are met (see below); and
73
•
the Fund may irrevocably designate a debt investment that meets the amortised cost or FVTOCI
criteria as measured at FVTPL if doing so eliminates or significantly reduces an accounting mismatch
(see below).
I.
Financial assets at amortised cost and effective interest method
The effective interest method is a method of calculating the amortised cost of a debt instrument and of
allocating interest income over the relevant period.
For financial assets other than purchased or originated credit
‑
impaired financial assets (i.e. assets that are
credit
‑
impaired on initial recognition), the effective interest rate is the rate that exactly discounts estimated
future cash receipts (including all fees and points paid or received that form an integral part of the effective
interest rate, transaction costs and other premiums or discounts) excluding expected credit losses, through
the expected life of the debt instrument, or, where appropriate, a shorter period, to the gross carrying amount
of the debt instrument on initial recognition. For purchased or originated credit
‑
impaired financial assets, a
credit
‑
adjusted effective interest rate is calculated by discounting the estimated future cash flows, including
expected credit losses, to the amortised cost of the debt instrument on initial recognition.
The amortised cost of a financial asset is the amount at which the financial asset is measured at initial
recognition minus the principal repayments, plus the cumulative amortisation using the effective interest
method of any difference between that initial amount and the maturity amount, adjusted for any loss allowance.
The gross carrying amount of a financial asset is the amortised cost of a financial asset before adjusting for
any loss allowance.
Interest income is recognised using the effective interest method for debt instruments measured subsequently
at amortised cost and at FVTOCI. For financial assets other than purchased or originated credit
‑
impaired
financial assets, interest income is calculated by applying the effective interest rate to the gross carrying
amount of a financial asset, except for financial assets that have subsequently become credit
‑
impaired (see
below). For financial assets that have subsequently become credit
‑
impaired, interest income is recognised by
applying the effective interest rate to the amortised cost of the financial asset. If, in subsequent reporting
periods, the credit risk on the credit
‑
impaired financial instrument improves so that the financial asset is no
longer credit
‑
impaired, interest income is recognised by applying the effective interest rate to the gross carrying
amount of the financial asset.
For purchased or originated credit
‑
impaired financial assets, the Fund recognises interest income by applying
the credit
‑
adjusted effective interest rate to the amortised cost of the financial asset from initial recognition.
The calculation does not revert to the gross basis even if the credit risk of the financial asset subsequently
improves so that the financial asset is no longer credit
‑
impaired.
Interest income is recognised in profit or loss and is included in the financial income.
II.
Financial assets classified as at FVTOCI
There are no debt instruments or equity instruments designated as at FVTOCI as at Statement of Financial
Position’s date.
Financial assets at FVTPL
Financial assets that do not meet the criteria for being measured at amortised cost or FVTOCI (see I.) are
measured at FVTPL. Specifically:
•
investments in equity instruments are classified as at FVTPL, unless the Fund designates an equity
investment that is neither held for trading nor a contingent consideration arising from a business
combination as at FVTOCI on initial recognition;
•
debt instruments that do not meet the amortised cost criteria or the FVTOCI criteria (see (I.) and (II.)
above) are classified as at FVTPL. In addition, debt instruments that meet either the amortised cost
criteria or the FVTOCI criteria may be designated as at FVTPL upon initial recognition if such
designation eliminates or significantly reduces a measurement or recognition inconsistency (so
called “accounting mismatch”) that would arise from measuring assets or liabilities or recognising the
74
gains and losses on them on different bases. The Fund has not designated any debt instruments as
at FVTPL.
Financial assets at FVTPL are measured at fair value at the end of each reporting period, with any fair value
gains or losses recognised in profit or loss to the extent they are not part of a designated hedging relationship.
The net gain or loss recognised in profit or loss includes any dividend or interest earned on the financial asset
and is included in the financial income or financial expenses.
All the Fund’s financial assets are classified as financial assets at amortised cost and effective interest method,
except for:
•
investments in associates; and
•
derivative financial instruments.
The Fund recognises a loss allowance for expected credit losses on investments in debt instruments that are
measured at amortised cost or at FVTOCI, lease receivables, trade receivables and contract assets, as well
as on financial guaranteed contracts. The amount of expected credit losses is updated at each reporting date
to reflect changes in credit risk since initial recognition of the respective financial instrument.
The Fund always recognises lifetime ECL for trade receivables, contract assets and lease receivables. The
expected credit losses on these financial assets are estimated using a provision matrix based on the Fund’s
historical credit loss experience, adjusted for factors that are specific to the debtors, general economic
conditions, and an assessment of both the current as well as the forecast direction of conditions at the reporting
date, including time value of money where appropriate.
For all other financial instruments, the Fund recognises lifetime ECL when there has been a significant increase
in credit risk since initial recognition. However, if the credit risk on the financial instrument has not increased
significantly since initial recognition, the Fund measures the loss allowance for that financial instrument at an
amount equal to 12
‑
month ECL.
Lifetime ECL represents the expected credit losses that will result from all possible default events over the
expected life of a financial instrument. In contrast, 12
‑
month ECL represents the portion of lifetime ECL that is
expected to result from default events on a financial instrument that are possible within 12 months after the
reporting date.
Write-off policy
The Fund writes off a financial asset when there is information indicating that the debtor is in severe financial
difficulty and there is no realistic prospect of recovery, e.g. when the debtor has been placed under liquidation
or has entered into bankruptcy proceedings, or in the case of trade receivables, when the amounts are over
one year past due, whichever occurs sooner. Financial assets written off may still be subject to enforcement
activities under the Fund’s recovery procedures, considering legal advice where appropriate. Any recoveries
made are recognised in profit or loss.
The measurement of expected credit losses is a function of the probability of default, loss given default (i.e.
the magnitude of the loss if there is a default) and the exposure at default. The assessment of the probability
of default and loss given default is based on historical data adjusted by forward
‑
looking information as
described above.
As for the exposure at default, for financial assets, this is represented by the assets’ gross carrying amount at
the reporting date; for financial guarantee contracts, the exposure includes the amount drawn down as at the
reporting date, together with any additional amounts expected to be drawn down in the future by default date
determined based on historical trend, the Fund’s understanding of the specific future financing needs of the
debtors, and other relevant forward
‑
looking information.
75
For financial assets, the expected credit loss is estimated as the difference between all contractual cash flows
that are due to the Fund in accordance with the contract and all the cash flows that the Fund expects to receive,
discounted at the original effective interest rate. For a lease receivable, the cash flows used for determining
the expected credit losses are consistent with the cash flows used in measuring the lease receivable in
accordance with IFRS 16.
For a financial guarantee contract, as the Fund is required to make payments only in the event of a default by
the debtor in accordance with the terms of the instrument that is guaranteed, the expected loss allowance is
the expected payments to reimburse the holder for a credit loss that it incurs less any amounts that the Fund
expects to receive from the holder, the debtor or any other party.
If the Fund has measured the loss allowance for a financial instrument at an amount equal to lifetime ECL in
the previous reporting period but determines at the current reporting date that the conditions for lifetime ECL
are no longer met, the Fund measures the loss allowance at an amount equal to 12
‑
month ECL at the current
reporting date, except for assets for which a simplified approach was used.
The Fund recognises an impairment gain or loss in profit or loss for all financial instruments with a
corresponding adjustment to their carrying amount through a loss allowance account, except for investments
in debt instruments that are measured at FVTOCI, for which the loss allowance is recognised in other
comprehensive income and accumulated in the revaluation reserve, and does not reduce the carrying amount
The Fund derecognises a financial asset only when the contractual rights to the cash flows from the asset
expire, or when it transfers the financial asset and substantially all the risks and rewards of ownership of the
asset to another entity. If the Fund neither transfers nor retains substantially all the risks and rewards of
ownership and continues to control the transferred asset, the Fund recognises its retained interest in the asset
and an associated liability for amounts it may have to pay. If the Fund retains substantially all the risks and
rewards of ownership of a transferred financial asset, the Fund continues to recognise the financial asset and
also recognises a collateralised borrowing for the proceeds received.
On derecognition of a financial asset measured at amortised cost, the difference between the asset’s carrying
amount and the sum of the consideration received, and receivable is recognised in profit or loss. In addition,
on derecognition of an investment in a debt instrument classified as at FVTOCI, the cumulative gain or loss
previously accumulated in the revaluation reserve is reclassified to profit or loss. In contrast, on derecognition
of an investment in equity instrument which the Fund has elected on initial recognition to measure at FVTOCI,
the cumulative gain or loss previously accumulated in the revaluation reserve is not reclassified to profit or loss
13.9.3
Financial liabilities and equity
All financial liabilities are measured subsequently at amortised cost using the effective interest method or at
FVTPL.
However, financial liabilities that arise when a transfer of a financial asset does not qualify for derecognition or
when the continuing involvement approach applies, and financial guarantee contracts issued by the Fund, are
measured in accordance with the specific accounting policies set out below.
Financial liabilities are classified as at FVTPL when the financial liability is:
1.
contingent consideration of an acquirer in a business combination;
2.
held for trading; or
3.
it is designated as at FVTPL.
76
A financial liability is classified as held for trading if:
•
it has been acquired principally for the purpose of repurchasing it in the near term; or
•
on initial recognition it is part of a portfolio of identified financial instruments that the Fund manages
together and has a recent actual pattern of short
‑
term profit
‑
taking; or
•
it is a derivative financial instrument, except for a derivative financial instrument that is a financial
guarantee contract or a designated and effective hedging instrument.
A financial liability other than a financial liability held for trading or contingent consideration of an acquirer in a
business combination may be designated as at FVTPL upon initial recognition if:
•
such designation eliminates or significantly reduces a measurement or recognition inconsistency that
would otherwise arise; or
•
the financial liability forms part of a Fund of financial assets or financial liabilities or both, which is
managed, and its performance is evaluated on a fair value basis, in accordance with the Fund’s
documented risk management or investment strategy, and information about the Grouping is
provided internally on that basis; or
•
it forms part of a contract containing one or more embedded derivative financial instruments, and
IFRS 9 permits the entire combined contract to be designated as at FVTPL.
net gain or loss recognised in profit or loss incorporates any interest paid on the financial liability and is included
in financial income or financial expenses.
However, for financial liabilities that are designated as at FVTPL, the amount of change in the fair value of the
financial liability that is attributable to changes in the credit risk of that liability is recognised in other
comprehensive income, unless the recognition of the effects of changes in the liability’s credit risk in other
comprehensive income would create or enlarge an accounting mismatch in profit or loss. The remaining
amount of change in the fair value of liability is recognised in profit or loss. Changes in fair value attributable
to a financial liability’s credit risk that are recognised in other comprehensive income are not subsequently
reclassified to profit or loss; instead, they are transferred to retained earnings upon derecognition of the
financial liability.
Financial liabilities measured subsequently at amortised cost
Financial liabilities that are not:
1.
contingent consideration of an acquirer in a business combination, or
2.
held
‑
for
‑
trading, or
3.
designated as at FVTPL
are measured subsequently at amortised cost using the effective interest method.
The effective interest method is a method of calculating the amortised cost of a financial liability and of
allocating interest expense over the relevant period. The effective interest rate is the rate that exactly discounts
estimated future cash payments (including all fees and points paid or received that form an integral part of the
effective interest rate, transaction costs and other premiums or discounts) through the expected life of the
financial liability, or (where appropriate) a shorter period, to the amortised cost of a financial liability.
All the Fund’s liabilities are classified as financial liabilities measured subsequently at amortised cost, except
for derivative financial instruments. Derivative financial instruments are classified as financial liabilities at
FVTPL.
77
The Fund enters into a variety of derivative financial instruments to manage its exposure to interest rate and
foreign exchange rate risks, including foreign exchange forward contracts, options and interest rate swaps.
Derivative financial instruments are recognised initially at fair value at the date a derivative contract is entered
into and are subsequently remeasured to their fair value at each reporting date. The resulting gain or loss is
recognised in profit or loss immediately unless the derivative is designated and effective as a hedging
instrument, in which event the timing of the recognition in profit or loss depends on the nature of the hedge
relationship.
A derivative financial instrument with a positive fair value is recognised as a financial asset whereas a
derivative financial instrument with a negative fair value is recognised as a financial liability. Derivative financial
instruments are not offset in the Consolidated Financial Statements unless the Fund has both the legal right
and the intention to offset. A derivative financial instrument is presented as a non
‑
current asset or a non
‑
current
liability if the remaining maturity of the instrument is more than 12 months and it is not expected to be realised
or settled within 12 months.
INVESTMENT PROPERTY
13.10.1 General
Investment property comprises owned investment property, lease incentives, as well as right-of-use assets.
Investment property is property that is held to realise rental income or an increase in value, or both. The initial
recognition of investment property is at cost including related transaction costs. Additions to investment
property also includes letting fees. After initial recognition, investment property is carried at fair value, with an
adjustment for the carrying amount of lease incentives.
Lease incentives are initially and subsequently measured at historical cost. Lease incentives are allocated
proportionally to subsequent periods.
Right-of-use assets are assets that represent a lessee’s right to use an underlying asset for the lease term.
For the accounting principles of right-of-use assets reference is made to section 13.39 “Leases”.
The time of accounting an investment property sale is based on an assessment of the time when control is
transferred. The Fund believes that control is transferred when the investment property is transferred to the
buyer and this party can therefore actually dispose of the investment property.
Standard methods of valuation
Fair value is the price that would be received for an asset in an orderly transaction between market participants
at the measurement date and adjusted, if necessary, for differences in the nature, location, or condition of the
specific asset. If this information is not available, the Fund uses alternative valuation methods, such as recent
prices on less active markets or discounted cash flow or capitalisation projections.
Three standard methods of valuation computation are considered, namely:
I.
term and reversion method;
II.
hard core and top-slice method;
III.
initial yield method.
78
I.
Term and reversion method
The term and reversion method, normally used for under-rented property, involves the following: net income
up to the end of the contract term and the market-based net income over the following at least ten years are
discounted back to the valuation date (“term”). For the time after this period, the stabilised net rental income
is capitalised at the market interest rate and also discounted back to the valuation date to determine the
perpetual yield (“reversion”). Depending on the estimates of risk - which are based on the type of property,
location and region as well as current market circumstances - different discount rates are applied to the current
rental income and the capitalisation of the perpetual yield. The time-weighted average of these rates is the
equivalent yield. The assumptions underlying the valuation, e.g. for risk, void periods, vacancies or
maintenance costs and capex are based on estimates by relevant market players, on derived data or the
appraisers’ experience. Capital expense (
CAPEX
) is expenditure in the foreseeable future which falls outside
the scope of the normal annual maintenance programme.
II.
Hard core and top-slice method
The hard core and top-slice method, normally used for over-rented property, is conceptually related to the term
and reversion approach but separates the income stream into two distinct components based on their risk
profile. The hard core component represents the sustainable market rent (ERV) and is capitalised in perpetuity
using the hard core equivalent (initial) yield, reflecting the overall risk of the property. The top-slice component
represents any excess income above the ERV (i.e. over-rented element) during the remaining lease term. This
surplus income is treated as a finite cash flow and is discounted over the unexpired lease term using a risk-
adjusted discount rate, typically higher than the hard core equivalent yield to reflect leasing risk, tenant default
risk, and the probability of reversion to market rent at expiry. The magnitude of the risk premium applied to the
top-slice depends on the strength of covenant, lease security, and reletting risk. The time-weighted average
of the hardcore and top slice yields is the equivalent yield.
III.
Initial yield method
The initial yield method applies a single all risks yield at the date of valuation, i.e. net income / gross purchase
price.
Equivalent yield
Equivalent yield is the overall return on a property investment. It combines two key metrics in commercial property
investment: net initial yield and reversionary/top slice yield. It provides a single figure that represents the property's
return based on current income and potential future rental value. It provides investors and valuers with a
standardised way to compare different investment opportunities and different but relevant market transactions.
13.10.3
Applied standard method of measurement
Valuations are performed as at Statement of Financial Position’s date. External valuations are performed by
an independent appraiser with relevant recognised qualifications and recent experience with the location and
the type of property. The valuations have been made in accordance with the appropriate sections of the current
RICS Valuation Standards. The fair values are based on market values, being the estimated amount for which
a property could be exchanged on the date of valuation between a willing buyer and a willing seller in an arm’s
length transaction after proper marketing wherein the parties had each acted knowledgeably, prudently and
without compulsion. Considering the type of investment property Level 3 fair value hierarchy is applied for all
properties in the portfolio.
The valuations are made on the basis of the total of the net annual rents generated by the property and, where
relevant, the associated costs. The major sources of uncertainty in estimates are as follows:
A. development of rents;
B.
capitalisation factor for transactions;
C.
fair rents per type of property;
D. property prices;
E. vacancy;
F.
remaining period of non-cancellable rental contracts.
79
For all properties that are measured at fair value, the current use of the property is its highest and best use. In
these Financial Statements all properties were externally valued using either the “term and reversion” or “hard
13.10.4
Analysis of assumptions and input parameters used in the valuations per property category
The fair value is the outcome of the (theoretical) rent divided by the net initial yield (expressed as a percentage)
of the investment property. The yields applied are specific to the type of property, location, maintenance
condition and letting potential of each asset. The yields are determined based on comparable transactions, as
well as on market and asset-specific knowledge.
The most important assumptions and input parameters used in the valuations are set out in the tables below.
2025 |
2024 |
||
3 F |
|||
No. |
Property category |
Yield factor 4 |
Yield factor |
in % |
in % |
||
A |
Office B + -class |
5.75 - 10.00 |
6.01 - 9.50 |
B |
Office B – -class |
N.a. |
N.a. |
C |
Office / business B / C-class |
N.a. |
N.a. |
4 F |
|||
D |
Retail B-class 5 |
6.85 - 9.00 |
N.a. |
2025 |
2024 |
||
Market rent |
Market rent |
||
No. |
Property category |
per sqm |
per sqm |
in € |
in € |
||
A |
Office B + -class |
133 - 168 |
132 - 208 |
B |
Office B – -class |
N.a. |
N.a. |
C |
Office / business B / C-class |
N.a. |
N.a. |
D |
Retail B-class |
100 - 154 |
92 - 154 |
2025 |
2024 |
||
No. |
Property category |
Vacancy |
Vacancy |
in % |
in % |
||
A |
Office B + -class |
12.5 - 100.0 |
0.0 - 27.1 |
B |
Office B – -class |
N.a. |
N.a. |
C |
Office / business B / C-class |
N.a. |
N.a. |
D |
Retail B-class |
0.0 - 22.9 |
0.0 - 22.9 |
Where necessary the following aspects are reflected in the valuation:
•
the type of tenant that uses the property or that is responsible for fulfilling the rental obligations, or
the type of tenant that is likely to use the property after vacancy, and the general expectation with
regard to their creditworthiness;
•
void periods, vacancies, and maintenance costs, which are based on estimates by relevant market
players, on derived data or the appraisers’ experience;
•
the residual economic life of the property. Standard and infinite economic life is assumed;
•
it is assumed that in the case of rent adjustment or extension of the lease, in the case of which a rent
increase is expected, all notifications, and where necessary notices to the contrary, meet all legal
requirements and have been sent in good time.
4
The yield factors 2024 and 2025 corresponds with the equivalent yield specifications of the external independent appraiser.
5
Higher yields are related to the leasehold retail assets.
80
Profits or losses arising from changes in the fair value are recognised in the Income Statement. In determining
the property fair value capitalized lease incentives are reflected in the valuation results, to avoid double
counting
.
On valuation date, the ongoing situation in Ukraine continues to create significant uncertainty in property
valuations, particularly due to the persistent military conflict and the scarcity of relevant or sufficient market
evidence for valuers to base their judgments on. In accordance with VPS 3 and VPGA 10 of the RICS Valuation
- Global Standards, valuations are reported with material valuation uncertainty, meaning less certainty and a
higher degree of caution should be attached to the reported values. Market instability and potential further
developments in the conflict could lead to rapid changes in property values, necessitating frequent reviews.
As of April 30, 2026, the Managing Board does not anticipate any direct adverse impacts from developments
in Ukraine on the Fund’s remaining real estate portfolio in Central Europe. With the exception of Ukraine, the
Fund operates in countries that are NATO members, and while geopolitical tensions remain heightened, the
likelihood of military escalation into NATO territories remains low, given the potential for immediate collective
defence measures. The Fund continues to monitor macroeconomic conditions and market stability in its
INVESTMENT PROPERTY UNDER DEVELOPMENT
Property currently under construction or development for future use as investment property is classified as
investment property under development. Such property is measured at fair value as mentioned in section
13.10.3 “Applied standard method of measurement” when its fair value can be reliably determined. If the fair
value of investment property under development cannot reliably be determined but is expected to be reliably
determinable upon completion of construction, it is measured at cost less impairment until the fair value can
be reliably determined or construction is completed - whichever occurs first.
Determining the fair value of the investment property under development can sometimes present challenges.
To assess this, the Managing Board considers various factors, including, but not limited to:
•
provisions of the construction contract;
•
stage of completion;
•
whether the project / property is standard (typical for the market) or non-standard;
•
reliability of expected cash inflows after completion;
•
specific development risks associated with the property;
•
experience with similar constructions;
•
status of construction permits.
Costs include the material and labour for the construction, costs of staff related to technical supervision, project
management on the basis of time spent and finance costs. The finance cost refers to the capitalized interest
charged up until the delivery date. This interest is allocated to development projects based on either a specific
project's financing rate or, in cases where no specific project financing exists, it is determined by the Fund's
average effective rate. Interest charges include interest, and all costs associated with the Fund.
Capitalised interest will cease when substantially all the activities necessary to prepare the investment property
under development for its intended use or sale are completed.
The fair value of investment property under development is determined in a manner consistent with that of
investment property, with the understanding that the capitalisation factor is adjusted to reflect development
risks.
Changes in fair value and impairment losses are recognised in the Income Statement as valuation result.
81
INVESTMENTS IN ASSOCIATES
An associate is an entity over which the Fund has significant influence.
Usually, investments in associates are valued using the equity method. Since the investments in associates
are held by, or are held indirectly through a “mutual fund” the Fund elects to measure the investments in
associates at fair value through profit or loss in accordance with IFRS 9 (IAS 28:18). Therefore, investments
in associates are initially and subsequently recognised at fair value, with transaction costs recognised in the
Income Statement. The properties (inventories excluded, if applicable) held by associates are valued at fair
DERIVATIVE FINANCIAL INSTRUMENTS
For the accounting principles with regard to derivative financial instruments (assets and liabilities) reference is
13.14
DEFERRED TAX ASSETS
For the accounting principles with regard to deferred tax assets reference is made to section 13.42 “Income
tax expense”.
13.15
TAX ASSETS
Tax assets comprise the expected tax receivable on the taxable amounts and any adjustments to the tax
receivable in respect of previous years. The amount of the tax receivable is the best estimate of the tax amount
expected to be received, reflecting uncertainty related to taxes.
TRADE AND OTHER RECEIVABLES
Trade and other receivables (without a significant financing component) are initially measured at the
transaction price and subsequently measured at amortised cost using the effective interest method, less
13.17
PREPAYMENTS AND DEFERRED EXPENSES
Prepayments and deferred expenses are initially and subsequently measured at historical cost. Prepayments
and deferred expenses are allocated proportionally to subsequent periods.
82
CASH AND CASH EQUIVALENTS
Cash and cash equivalents consist of cash and cash held in bank accounts. Time deposits are only included
in cash and cash equivalents if the expectation is that they will be used to fund working capital within a period
of three months or less from the date of acquisition. Cash and cash equivalents meet the definition given by
IFRS 9, i.e., short-term, highly-liquid investments that are readily convertible to known amounts of cash and
subject to an insignificant risk of changes in value.
Cash and cash equivalents are recognised and measured at fair value through profit or loss in accordance
with IFRS 9, as described in section 13.9 “Financial instruments”.
In the Consolidated Statement of Cash Flows, bank overdrafts at call, which are an integral part of the Fund's
ASSETS HELD FOR SALE
13.19.1 General
Non-current assets or disposal groups comprising assets and liabilities are classified as held for sale if it is
highly probable that they will be recovered primarily through sale rather than through continuing use. This only
applies if the asset or disposal group is available for immediate sale in its present condition. Furthermore, the
sale must be highly probable, the Managing Board must be committed to a plan to sell the asset or disposal
group and an active programme to locate a buyer must have been initiated. It is expected the sale will
principally be completed within one year from the date of classification.
13.19.2
Measurement of fair value
Assets or disposal groups held for sale are generally measured at the lower of their carrying amount and fair
value less cost of disposal, except for investment property. Investment property held for sale and right-of-use
assets held for sale are measured as mentioned in section 13.10.3 “Applied standard method of
measurement”. Any impairment loss on a disposal group is allocated to the remaining assets and liabilities on
a pro rata basis, except that no loss is allocated to financial assets, deferred tax assets or investment property,
which continue to be measured in accordance with the Fund’s regular accounting policies. Impairment losses
on initial classification as held for sale or held for distribution and subsequent gains and losses on re-
measurement are recognised in the Income Statement.
Once classified as held for sale, intangible assets and property, plant and equipment are no longer amortised
GROUP EQUITY
For the accounting principles of the several shareholders’ equity components reference is made to sections
13.21
TAX LIABILITIES
Tax liabilities comprise the expected tax payable on the taxable amounts and any adjustments to the tax
payable in respect of previous years. The amount of the tax payable is the best estimate of the tax amount
expected to be paid, reflecting uncertainty related to taxes.
83
LOANS AND BORROWINGS
Loans and borrowings are recognised initially at fair value, net of transaction costs incurred and subsequently
measured at amortised cost, with any difference between cost and the redemption amount being stated in the
TRADE AND OTHER PAYABLES
Trade and other payables are recognised initially at fair value and subsequently measured at amortised cost
13.24
DEFERRED INCOME AND TENANT DEPOSITS
Deferred income and tenant deposits are initially and subsequently measured at historical cost. Deferred
income is allocated proportionally to subsequent periods. Tenant deposits are recognised at their received
amounts.
13.25
DEFERRED TAX LIABILITIES
For the accounting principles with regard to the deferred tax liabilities reference is made to section 13.42
“Income tax expense”.
PROVISIONS
A provision is a liability of uncertain timing or amount.
A provision shall be recognised when:
•
the Fund has a present obligation (legal or constructive) as a result of a past event;
•
it is probable that an outflow of resources embodying economic benefits will be required to settle the
obligation; and
•
a reliable estimate can be made of the amount of the obligation.
If these conditions are not met, no provision shall be recognised.
A provision is measured at the best estimate of the expenditure required to settle the present obligation at the
end of the reporting period and is discounted if the effect of discounting is material. Future events that may
affect the amount required to settle an obligation shall be reflected in the amount of a provision where there is
sufficient objective evidence that they will occur.
The best estimate of the expenditure required to settle the present obligation is the amount that the Fund would
rationally pay to settle the obligation at the end of the reporting period or to transfer it to a third party at that
time. It will often be impossible or prohibitively expensive to settle or transfer an obligation at the end of the
reporting period. However, the estimate of the amount that the Fund would rationally pay to settle or transfer
the obligation gives the best estimate of the expenditure required to settle the present obligation at the end of
84
13.27
CONTRACT ASSETS
Revenue is measured based on the consideration specified in a contract with a customer. The Fund recognises
revenue when it transfers control over a good or service to a customer.
In determining the timing and amount of recognition, the following aspects are considered, in accordance with
IFRS 15:
1.
identify the contract with the customer;
2.
identify the separate performance obligation within the contract;
3.
determine the transaction price;
4.
allocate the transaction price to the individual performance obligations; and
5.
recognise the revenues in case the Fund has met the individual performance obligation.
The transaction price is the amount of consideration to which the Fund expects to be entitled in exchange for
transferring promised goods or services to a customer, excluding amounts collected on behalf of third parties
(for example, sales taxes). The consideration promised in a contract with a customer may include fixed
amounts, variable amounts, or both. Variable amounts are only included in the transaction price if it is highly
probable that a significant reversal in the amount of cumulative revenue recognised will not occur when the
uncertainty associated with the variable consideration is subsequently resolved.
GROSS RENTAL INCOME
Gross rental income from investment property is stated in the Income Statement excluding value added tax
(VAT), on the basis of the period of the lease. If the investment property has been acquired during the financial
period, the rental income is accounted as of the date of acquisition by the Fund. If office or other equipment is
leased together with the premises, this is included in the rental income.
Rent adjustments due to indexation are recognised as they arise.
Rent-free periods and investments made, or allowances granted to tenants by the Fund (lease incentives) are
allocated on a linear basis over the lease term. The lease term consists of the period until the first break option
for the tenants, which period can be extended by the Managing Board with the expected prolongation of the
leases.
Revenue received from tenants for early termination of leases is directly recognised in the Income Statement
as it arises.
13.29
SERVICE CHARGE INCOME AND SERVICE CHARGE EXPENSES
The Fund is acting as principal for service charge income. Service charge income corresponds to service
charges invoiced to tenants and is presented separately in the Income Statement. Service charge income is
recorded as income in the period in which it is earned.
Service charge expenses cover the costs of services such as general maintenance and repairs, security,
heating, cooling, lighting and cleaning of common areas. Service charge expenses are recognised in the
85
13.30
PROPERTY OPERATING EXPENSES
Property operating expenses consist mainly of maintenance costs, property taxes, insurance premiums and
management and collection costs. Service charges are stated separately in the Income Statement. If the
investment property has been acquired during the financial period, the direct operating expenses are
accounted for from the date of acquisition by the Fund.
13.31
VALUATION RESULTS OF PROPERTIES
The valuation results of properties (inventories excluded) relate to unrealised changes in the fair value of
properties compared to the fair value as at 31 December of the preceding financial period. In case (part of) a
property is sold the valuation result of properties also includes the reversal of the unrealised changes in the
fair value from prior years (reference is made to section 13.31 “Result on disposals of properties”).
RESULT ON DISPOSALS OF PROPERTIES
The result on disposals of properties comprises realised result on disposals of properties (inventories
excluded). This result is calculated by the difference between the selling price less the original purchase price.
Therefore, the result on disposals of properties comprises the valuation result of properties in the current year
(REVERSAL OF) IMPAIRMENT ALLOWANCE OF INVENTORIES
The (reversal of) impairment allowance of inventories relate to (reversal of) impairment changes of the
13.34
RESULT ON DISPOSALS OF INVENTORIES
The result on disposals of inventories relates to realised result on disposals of inventories. This result is
calculated by the difference between the selling price less valuation as at 31 December of the preceding
financial period.
13.35
SHARE IN RESULTS OF INVESTMENTS IN ASSOCIATES
The share in results of investments in associates relates to its share in the unrealised changes in the fair value
of investments in associates compared to its share in the fair value as at 31 December of the preceding
financial period, as well as the dividends the Fund is entitled to during the financial period. In case (part of) an
investment in an associate is sold the share in results of investments in associates also includes the reversal
of the unrealised changes in the fair value from prior years (reference is made to section 13.35 “Result on
disposals of investments in associates”).
13.36
RESULT ON DISPOSALS OF INVESTMENTS IN ASSOCIATES
The result on disposals of investments in associates relates to the realised result on disposals of investments
in associates. This result is calculated by the difference between the selling price less the original purchase
price. Therefore, the result on disposals of investments in associates comprises the valuation result of
investments in associates in the current year as well as the unrealised valuation result of investments in
associates booked in prior years.
86
FINANCIAL INCOME
Interest income on funds invested is recognised in the Income Statement as it accrues.
Given the nature of the Fund (investment company) financial income is not netted against finance charges,
but presented separately under the total income, except:
•
foreign exchange and currency results;
•
change in fair value of derivative financial instruments;
•
interest income / interest expense on derivative financial instruments; and
•
interest income / interest expense of Tax Authorities.
Financial income arises principally from the investments held in order to be used for investment in property.
Financial income also includes the exchange and currency translation profits that arise principally from the
settlement of monetary items or from the translation of monetary items in foreign currency.
13.38
OTHER OPERATING INCOME
Other operating income is recognised in the Income Statement when it is probable that the economic benefits
will flow into the Fund and the (net) revenues can be measured reliably.
Other operating income also includes penalties for early termination of rental contracts. Tenants who terminate
leases prior to the contractual expiration date are liable to pay early termination penalties, which are credited
to income for the period in which they are recognised.
LEASES
At inception of a contract, the Fund assesses whether a contract is, or contains, a lease. A contract is, or
contains, a lease if the contract conveys the right to control the use of an identified asset for a period of time
in exchange for consideration. To assess whether a contract conveys the right to control the use of an identified
asset, the Fund uses the definition of a lease in IFRS 16.
13.39.1
The Fund as a lessee
At commencement or on modification of a contract that contains a lease component, the Fund allocates the
consideration in the contract to each lease component on the basis of its relative stand-alone prices. However,
for the leases of property the Fund has elected not to separate non-lease components and account for the
lease and non-lease components as a single lease component.
The Fund recognises a right-of-use asset and a lease liability at the lease commencement date. The right-of-
use asset is initially measured at cost, which comprises the initial amount of the lease liability adjusted for any
lease payments made at or before the commencement date, plus any initial direct costs incurred and an
estimate of costs to dismantle and remove the underlying asset or to restore the underlying asset or the site
on which it is located, less any lease incentives received.
The right-of-use asset is subsequently measured at cost (subject to certain exceptions), less accumulated
depreciation and impairment losses or, if it relates to investment property the right-of-use will be valued at fair
value in line with IAS 40. The right-of-use will additionally be adjusted for any remeasurement of the lease
liability, when applicable.
The lease liability is initially measured at the present value of the lease payments that are not paid at the
commencement date, discounted using the interest rate implicit in the lease or, if that rate cannot be readily
determined, the Fund’s incremental borrowing rate. The Fund uses its incremental borrowing rate as the
discount rate.
87
The Fund determines its incremental borrowing rate by obtaining interest rates from various external financing
sources and makes certain adjustments to reflect the terms of the lease and type of the asset leased.
Lease payments included in the measurement of the lease liability comprise the following:
•
fixed payments, including in-substance fixed payments;
•
variable lease payments that depend on an index or a rate, initially measured using the index or rate
as at the commencement date;
•
amounts expected to be payable under a residual value guarantee; and
•
the exercise price under a purchase option that the Fund is reasonably certain to exercise, lease
payments in an optional renewal period if the Fund is reasonably certain to exercise an extension
option, and penalties for early termination of a lease unless the Fund is reasonably certain not to
terminate early.
The lease liability is subsequently increased by the interest cost on the lease liability and decreased by lease
payments made. It is remeasured when there is a change in future lease payments arising from a change in
an index or rate, a change in the estimate of the amount expected to be payable under a residual value
guarantee, or as appropriate, changes in the assessment of whether a purchase or extension option is
reasonably certain to be exercised or a termination option is reasonably certain not to be exercised.
When the lease liability is remeasured in this way, a corresponding adjustment is made to the carrying amount
of the right-of-use asset or is recorded in profit or loss if the carrying amount of the right-of-use asset has been
reduced to zero.
13.39.2
Short-term leases and low value assets
The Fund has elected not to recognise right-of-use assets and lease liabilities for leases of low-value assets
(USD 5,000 or less) and short-term leases. The Fund recognises the lease payments associated with these
leases as an expense on a straight-line basis over the lease term.
13.39.3
The Fund as a lessor
At inception or on modification of a contract that contains a lease component, the Fund allocates the
consideration in the contract to each lease component on the basis of their relative stand-alone prices.
When the Fund acts as a lessor, it determines at lease inception whether each lease is a finance lease or an
operating lease.
To classify each lease, the Fund makes an overall assessment of whether the lease transfers substantially all
of the risks and rewards incidental to ownership of the underlying asset. If this is the case, then the lease is a
finance lease; if not, then it is an operating lease. As part of this assessment, the Fund considers certain
indicators such as whether the lease is for a major part of the economic life of the asset.
When the Fund is an intermediate lessor, it accounts for its interests in the head lease and the sub-lease
separately. It assesses the lease classification of a sub-lease with reference to the right-of-use asset arising
from the head lease, not with reference to the underlying asset. If a head lease is a short-term lease to which
the Fund applies the exemption described above, then it classifies the sub-lease as an operating lease.
If an arrangement contains lease and non-lease components, then the Fund applies IFRS 15 to allocate the
consideration in the contract.
The Fund applies the derecognition and impairment requirements in IFRS 9 to the net investment in the lease.
The Fund further regularly reviews estimated unguaranteed residual values used in calculating the gross
investment in the lease.
The Fund recognises lease payments received under operating leases as income on a straight-line basis over
the lease term as part of other operating income.
88
Generally, the accounting policies applicable to the Fund as a lessor in the comparative period did not differ
ADMINISTRATIVE EXPENSES AND OTHER OPERATING EXPENSES
Administrative expenses and other operating expenses are recognised in the Income Statement. Expenses
FINANCIAL EXPENSES
Financial expenses comprise the interest expense on funds taken up, calculated using the effective interest
method, exchange, and currency translation losses, which arise principally from the settlement of monetary
items, or in the translation of monetary items in foreign currency.
Financial expenses also include the negative changes in fair value of derivative financial instruments.
Interest expense is recognised in the Income Statement as it accrues, by means of the effective interest rate
INCOME TAX EXPENSE
13.42.1
Income tax expense
The income tax expense for the financial period comprises current and deferred tax. It is recognised in Income
Statement except to the extent that it relates to a business combination, or items recognised in equity or in
other comprehensive income.
The Fund has determined that the global minimum top-up-tax - which is required to be paid under Pillar Two
legislation - is an income tax. The Fund has applied a temporary mandatory relief from deferred tax accounting
for the impacts of the top-up tax and accounts for it as a current tax when it is incurred.
13.42.2 Current tax
The current tax comprises the expected tax payable or receivable on the taxable statement of income for the
financial period and any adjustments to the tax payable or receivable in respect of previous years. The amount
of current tax payable or receivable is the best estimate of the tax amount expected to be paid or received that
reflects uncertainty related to income taxes, if any. It is measured using tax rates enacted or substantively
enacted as at Statement of Financial Position’s date. Current tax also includes any tax arising from dividends.
Tax assets and liabilities are offset only if certain criteria are met.
89
Deferred tax is recognised in respect of taxable and / or deductible temporary differences between the carrying
amounts of assets and liabilities for financial reporting purposes and the amounts used for tax purposes.
Deferred tax is not recognised for:
•
taxable and / or deductible temporary differences on the initial recognition of assets or liabilities in a
transaction which:
o
is not a business combination; and
o
at the time of the transaction, affects neither accounting nor taxable profit or loss (“Initial
Recognition Exception”); and
o
at the time of the transaction, does not give rise to equal taxable and deductible temporary
differences.
•
taxable and / or deductible temporary differences related to investments in subsidiaries, associates
and joint arrangements to the extent that the Fund is able to control the timing of the reversal of the
taxable temporary differences and it is probable that they will not reverse in the foreseeable future;
•
taxable and / or deductible temporary differences arising on the initial recognition of goodwill.
Deferred tax assets are recognised for unused tax losses, unused tax credits and deductible temporary
differences to the extent that it is probable that future taxable profits will be available against which they can
be used. Future taxable profits are determined based on the reversal of relevant taxable temporary differences.
If the amount of taxable temporary differences is insufficient to recognise a deferred tax asset in full, then
future taxable profits, adjusted for reversals of existing temporary differences, are considered, based on the
business plans for individual subsidiaries in the Fund. Deferred tax assets are reviewed at each Statement of
Financial Position’s date and are reduced to the extent that it is no longer probable that the related tax benefit
will be realised; such reductions are reversed when the probability of future taxable profits improves.
Unrecognised deferred tax assets are reassessed at each Statement of Financial Position’s date and
recognised to the extent that it has become probable that future taxable profits will be available against which
they can be used.
Deferred tax is measured at the tax rates that are expected to be applied to taxable temporary differences
when they reverse, using tax rates enacted or substantively enacted at the Statement of Financial Position’s
date.
The measurement of deferred tax reflects the tax consequences that would follow from the manner in which
the Fund expects, at Statement of Financial Position’s date, to recover or settle the carrying amount of its
assets and liabilities. For this purpose, the carrying amount of properties measured at fair value is presumed
to be recovered through sale, and the Fund has not rebutted this presumption.
Deferred tax assets and deferred tax liabilities are not discounted.
Deferred tax assets and liabilities are offset in case the Fund or its subsidiaries has a legally enforceable right
to set-off tax assets against tax liabilities and the deferred tax assets and the deferred tax liabilities relate to
90
SEGMENT
INFORMATION
14.1
GENERAL
•
that engages in business activities from which it may earn revenues and incur expenses (including
revenues and expenses related to transactions with other components of the Fund);
•
whose operating results are used by the fund manager to make decisions about resources to be
allocated to the segment and to regularly review and assess its performance; and for which discrete
financial information is available.
Given the Fund’s management decision-making structure and internal reporting structure each property is
indicated as an operating segment. The properties held during the financial period (current period and / or
previous period), as mentioned in section 14.5.1 “Overview of segment result (Overview A)”, are taken into
account in the segment reporting overviews.
The following segment reporting overviews are given:
A.
overview of segment result (net operating income) for each property, apportioned to the Fund’s
geographic categories;
B.
overview carrying amount of type of each property, apportioned to the Fund’s business categories.
C.
14.2
GEOGRAPHIC CATEGORIES
The Fund distinguishes the following geographic categories:
A.
Czechia;
B.
Slovakia;
C.
Poland;
D.
Ukraine;
E.
Romania;
F.
The Netherlands;
G.
Other countries.
Since each separate property is indicated as an operating segment, most of the Fund’s assets cannot be
allocated to the geographic categories in overview C. Therefore, only the carrying amount of each property is
reported as a segment asset.
14.3
BUSINESS CATEGORIES
The Fund distinguishes the following business categories:
A.
Office;
B.
Retail;
C.
Residential;
D.
Land.
For an overview of the carrying amount of each property reference is made to section 14.5.3 “Specification
carrying amount of each property per business category (overview B)”.
91
14.4
CRITERIA OF GEOGRAPHIC AND BUSINESS CATEGORIES
•
if the assets in an individual foreign country represent more than 1% of the total assets as at
Statement of Financial Position’s date, these assets shall be disclosed separately. If those assets
represent less than 1% of the total assets as at Statement of Financial Position’s date, these items
will be allocated as other countries. The assets located in the Fund’s country of domicile are
disclosed separately, also in case these assets are less than 1% of the total assets;
•
the allocation of the property is based on the geographic location of the premises;
•
the allocation of deferred tax assets is based on the geographic location of the company which
generated the deferred tax assets;
•
the allocation of investments in associates and other equity investments is based on the business
location of the company the Fund invests in;
•
the allocation of other assets (tax assets, trade and other receivables, prepayments and deferred
expenses and cash and cash equivalents) is based on the geographic location of the debtor and / or
contracting party.
The allocation of segment results to the several geographic categories is based on the geographic location of
92
14.5
SEGMENT RESULTS
14.5.1
Overview of segment result (overview A)
Property | Subtotal net | |||||||||
Gross | Service | Service | operating | rental & | ||||||
Segment | rental income | charge income | charge expenses | expenses | related income | |||||
2025 | 2024 | 2025 | 2024 | 2025 | 2024 | 2025 | 2024 | 2025 | 2024 | |
| in € 1,000 | in € 1,000 | in € 1,000 | in € 1,000 | in € 1,000 | ||||||
Czechia: | ||||||||||
Palmovka | 96 | 288 | 13 | 149 | -/- 41 | -/- 108 | -/- 29 | -/- 103 | 39 | 226 |
Karlin | N.a. | 289 | N.a. | 130 | N.a. | -/- 95 | N.a. | -/- 62 | N.a. | 262 |
Newton House | 322 | 340 | 156 | 151 | -/- 140 | -/- 125 | -/- 140 | -/- 108 | 198 | 258 |
Total Czechia | 418 | 917 | 169 | 430 | -/- 181 | -/- 328 | -/- 169 | -/- 273 | 237 | 746 |
Slovakia: | ||||||||||
Záhradn í cka | N.a. | 191 | N.a. | 7 | N.a. | -/- 45 | N.a. | -/- 96 | N.a. | 57 |
Letná | 1,294 | 1,377 | 21 | 23 | -/- 214 | -/- 238 | -/- 426 | -/- 427 | 675 | 735 |
Total Slovakia | 1,294 | 1,568 | 21 | 30 | -/- 214 | -/- 283 | -/- 426 | -/- 523 | 675 | 792 |
Poland: | ||||||||||
Laubitza 8 | 207 | 218 | 102 | 101 | -/- 90 | -/- 91 | -/- 84 | -/- 77 | 135 | 151 |
800-lecia Inowroclawia | 190 | 199 | 182 | 174 | -/- 193 | -/- 185 | -/- 101 | -/- 101 | 78 | 87 |
Krzemowa | 306 | 305 | 233 | 239 | -/- 174 | -/- 171 | -/- 114 | -/- 94 | 251 | 279 |
Plutona | 175 | 176 | 70 | 67 | -/- 103 | -/- 95 | -/- 60 | -/- 48 | 82 | 100 |
Kalinkowa | 325 | 328 | 268 | 252 | -/- 244 | -/- 232 | -/- 104 | -/- 96 | 245 | 252 |
Wojska Polskiego | 310 | 321 | 265 | 263 | -/- 194 | -/- 204 | -/- 133 | -/- 99 | 248 | 281 |
Wolnosci | 231 | 86 | 170 | 82 | -/- 140 | -/- 110 | -/- 88 | -/- 65 | 173 | -/- 7 |
Grzymaly Siedleckiego | - | 251 | 19 | 155 | -/- 19 | -/- 148 | -/- 11 | -/- 32 | -/- 11 | 226 |
Kardyn. Wyszynskiego | 177 | 191 | 133 | 131 | -/- 143 | -/- 142 | -/- 51 | -/- 49 | 116 | 131 |
Legionow | 368 | 381 | 218 | 223 | -/- 224 | -/- 207 | -/- 65 | -/- 63 | 297 | 334 |
Maris | 770 | 603 | 480 | 348 | -/- 504 | -/- 410 | -/- 208 | -/- 163 | 538 | 378 |
Total Poland | 3,059 | 3,059 | 2,140 | 2,035 | -/- 2,028 | -/- 1,995 | -/- 1,019 | -/- 887 | 2,152 | 2,212 |
Ukraine: | ||||||||||
Aisi Bela | - | - | - | - | - | - | 2 | -/- 15 | 2 | -/- 15 |
Kiyanovskiy Residence | - | - | - | - | - | - | -/- 12 | - | -/- 12 | - |
Total Ukraine | - | - | - | - | - | - | -/- 10 | -/- 15 | -/- 10 | -/- 15 |
Bulgaria: | ||||||||||
Inventories | N.a. | - | N.a. | - | N.a. | -/- 4 | N.a. | -/- 11 | N.a. | -/- 15 |
Total Bulgaria | N.a. | - | N.a. | - | N.a. | -/- 4 | N.a. | -/- 11 | N.a. | -/- 15 |
Romania: | ||||||||||
EOS Business Park 6 | 289 | 790 | - | - | -/- 2 | - | -/- 67 | -/- 98 | 220 | 692 |
Lelar (Delenco) | N.a. | N.a. | N.a. | N.a. | N.a. | N.a. | N.a. | N.a. | N.a. | N.a. |
Total Romania | 289 | 790 | - | - | -/- 2 | - | -/- 67 | -/- 98 | 220 | 692 |
Grand total | 5,060 | 6,334 | 2,330 | 2,495 | -/- 2,425 | -/- 2,610 | -/- 1,691 | -/- 1,807 | 3,274 | 4,412 |
6
Tenant Danone terminated the lease agreement in March 2025, and the EOS building has been vacant since then.
93
Net result on | Financial | |||||||||
Subtotal net | properties and | expenses / other | ||||||||
rental & | equity | Other operating | operating | Total segment | ||||||
Segment | related income | investments | income 7 F 5 | expenses 8 6 F | result | |||||
2025 | 2024 | 2025 | 2024 | 2025 | 2024 | 2025 | 2024 | 2025 | 2024 | |
in € 1,000 | in € 1,000 | in € 1,000 | in € 1,000 | in € 1,000 | ||||||
Czechia: | ||||||||||
Palmovka | 39 | 226 | 463 | 55 | - | 3 | - | - | 502 | 284 |
Karlin | N.a. | 262 | N.a. | 70 | N.a. | 1 | N.a. | - | N.a. | 333 |
Newton House | 198 | 258 | -/- 282 | 332 | - | 1 | - | - | -/- 84 | 591 |
Total Czechia | 237 | 746 | 181 | 457 | - | 5 | - | - | 418 | 1,208 |
Slovakia: | ||||||||||
Záhradn í cka | N.a. | 57 | N.a. | -/- 137 | N.a. | - | N.a. | - | N.a. | -/- 80 |
Letná | 675 | 735 | -/- 4,192 | -/- 984 | - | - | - | - | -/- 3,517 | -/- 249 |
Total Slovakia | 675 | 792 | -/- 4,192 | -/- 1,121 | - | - | - | - | -/- 3,517 | -/- 329 |
Poland: | ||||||||||
Laubitza 8 | 135 | 151 | -/- 41 | -/- 31 | 3 | - | - | - | 97 | 120 |
800-lecia Inowroclawia | 78 | 87 | -/- 119 | -/- 80 | - | - | - | - | -/- 41 | 7 |
Krzemowa | 251 | 279 | 8 | 61 | - | - | - | - | 259 | 340 |
Plutona | 82 | 100 | 79 | -/- 20 | - | - | - | - | 161 | 80 |
Kalinkowa | 245 | 252 | -/- 82 | 59 | - | - | - | - | 163 | 311 |
Wojska Polskiego | 248 | 281 | -/- 8 | -/- 93 | - | - | - | - | 240 | 188 |
Wolnosci | 173 | -/- 7 | 9 | 380 | - | - | - | - | 182 | 373 |
Grzymaly Siedleckiego | -/- 11 | 226 | -/- 545 | -/- 35 | 9 | - | - | 3 | -/- 547 | 188 |
Kardyn. Wyszynskiego | 116 | 131 | -/- 209 | -/- 381 | - | - | 21 | 24 | -/- 114 | -/- 274 |
Legionow | 297 | 334 | -/- 55 | -/- 55 | - | - | 73 | 71 | 169 | 208 |
Maris | 538 | 378 | -/- 150 | -/- 1 | - | - | - | - | 388 | 377 |
Total Poland | 2,152 | 2,212 | -/- 1,113 | -/- 196 | 12 | - | 94 | 98 | 957 | 1,918 |
Ukraine: | ||||||||||
Aisi Bela | 2 | -/- 15 | -/- 81 | 366 | - | - | - | - | -/- 79 | 351 |
Kiyanovskiy Residence | -/- 12 | - | 394 | 126 | - | - | - | - | 382 | 126 |
Total Ukraine | -/- 10 | -/- 15 | 313 | 492 | - | - | - | - | 303 | 477 |
Bulgaria: | ||||||||||
Inventories | N.a. | -/- 15 | N.a. | 779 | N.a. | - | N.a. | - | N.a. | 764 |
Total Bulgaria | N.a. | -/- 15 | N.a. | 779 | N.a. | - | N.a. | - | N.a. | 764 |
Romania: | ||||||||||
EOS Business Park | 220 | 692 | -/- 604 | -/- 1,238 | 262 | - | - | - | -/- 122 | -/- 546 |
Lelar (Delenco) | N.a. | N.a. | 266 | 80 | - | - | 11 | 26 | 255 | 54 |
Total Romania | 220 | 692 | -/- 338 | -/- 1,158 | 262 | - | 11 | 26 | 133 | -/- 492 |
Grand total | 3,274 | 4,412 | -/- 5,149 | -/- 747 | 274 | 5 | 105 | 124 | -/- 1,706 | 3,546 |
7
Other operating income relates to penalties for early termination of rental contracts, reimbursement from tenants and compensation for
non-contractual use of the premises.
8
Financial expenses relate solely to interest expense on lease liabilities. Other operating expenses relates solely to Asset management
fee Delenco.
94
14.5.2
Reconciliation segment result with profit for the period
The reconciliation between the total segment results as calculated in section 14.5.1 “Overview of segment
result (overview A)” with the profit for the period, as stated in the Consolidated Income Statement, is made
below.
2025 | 2024 | |
in € 1,000 | in € 1,000 | |
Total segment result (overview A) | -/- 1,706 | 3,546 |
Unallocated income: | ||
Financial income | 372 | 865 |
Other operating income | 281 | 17 |
Less: early termination of rental contracts (allocated) | -/- 195 | -/- 5 |
Less: reimbursement from tenants (allocated) | -/- 70 | - |
Less: compensation for non-contractual use of the premises (allocated) | -/- 9 | - |
Subtotal unallocated income | 379 | 877 |
Unallocated expenses: | ||
Administrative expenses | 678 | 675 |
Other operating expenses | 1,252 | 1,296 |
Less: asset management fee (allocated) | -/- 11 | -/- 26 |
Subtotal unallocated operating expenses | 1,919 | 1,945 |
Financial expenses | 1,681 | 2,596 |
Less: interest expense on lease liabilities (allocated) | -/- 94 | -/- 98 |
Subtotal unallocated expenses | 3,506 | 4,443 |
Profit before income tax | -/- 4,833 | -/- 20 |
Income tax expense | -/- 488 | 12 |
Profit for the period | -/- 4,345 | -/- 32 |
95
14.5.3
Specification carrying amount of each property
7
F
9
per business category
8
F
10
(overview B)
31-12-2025 | 31-12-2024 | |
Carrying | Carrying | |
Segment | amount | amount |
In € 1,000 | In € 1,000 | |
Office: | ||
Palmovka | Sold | 4,264 |
Newton House | 7,408 | 6,761 |
Letná | Sold | 11,940 |
Maris | 9,260 | 9,390 |
EOS Business Park | 3,272 | 3,965 |
Total office | 19,940 | 36,320 |
Retail: | ||
Laubitza 8 | 1,940 | 1,980 |
800-lecia Inowroclawia | 2,420 | 2,530 |
Krzemowa | 3,260 | 3,240 |
Plutona | 2,000 | 1,920 |
Kalinkowa | 2,790 | 2,850 |
Wojska Polskiego | 3,210 | 3,210 |
Wolnosci | 2,270 | 2,260 |
Grzymaly Siedleckiego | Sold | 1,380 |
Kardyn. Wyszynskiego | 1,730 | 1,870 |
Legionow | 3,140 | 3,170 |
Total retail | 22,760 | 24,410 |
Land plots: | ||
Aisi Bela | 1,043 | 1,271 |
Kiyanovskiy Residence | 2,228 | 2,105 |
Total land | 3,271 | 3,376 |
Grand total | 45,971 | 64,106 |
14.5.4
Major tenants
The Fund reports the following tenants with a gross rental income of more than 10% of the Fund’s total gross
rental income:
Tenant | Building | 2025 | 2024 |
In € 1,000 | In € 1,000 | ||
AT&T Global Network Services Slovakia, s.r.o. | Letná | 667 | 820 |
Danone PDPA | EOS Business Park | 289 | 790 |
956 | 1,610 |
9
Right-of-use assets excluded.
10
Based on main purpose of the property.
96
14.5.5
Overview of geographic assets (overview C)
Czechia |
Slovakia |
Poland |
Ukraine |
Romania |
||||||
31-12-2025 |
31-12-2024 |
31-12-2025 |
31-12-2024 |
31-12-2025 |
31-12-2024 |
31-12-2025 |
31-12-2024 |
31-12-2025 |
31-12-2024 |
|
in € 1,000 |
in € 1,000 |
in € 1,000 |
in € 1,000 |
in € 1,000 |
||||||
Investment property |
7,408 |
11,025 |
- |
11,940 |
33,485 |
15,730 |
2,228 |
2,105 |
- |
3,965 |
Investment property under development |
- |
- |
- |
- |
- |
- |
- |
1,271 |
- |
- |
Investments in associates |
- |
- |
- |
- |
- |
- |
- |
- |
3,545 |
3,402 |
Derivative financial instruments |
- |
- |
- |
- |
- |
- |
- |
- |
- |
- |
Deferred tax assets |
- |
- |
- |
- |
- |
- |
84 |
95 |
1 |
- |
Tax assets |
- |
- |
12 |
- |
100 |
55 |
- |
3 |
41 |
2 |
Trade and other receivables |
207 |
183 |
8,447 |
238 |
1,021 |
349 |
- |
- |
248 |
378 |
Prepayments and deferred expenses |
52 |
68 |
17 |
31 |
186 |
137 |
- |
- |
8 |
5 |
Cash and cash equivalents |
696 |
260 |
134 |
467 |
1,118 |
978 |
8 |
4 |
229 |
181 |
Assets held for sale |
- |
- |
- |
- |
- |
19,580 |
1,043 |
- |
3,272 |
- |
8,363 |
11,536 |
8,610 |
12,676 |
35,910 |
36,829 |
3,363 |
3,478 |
7,344 |
7,933 |
|
The Netherlands |
Other countries |
Total |
||||
31-12-2025 |
31-12-2024 |
31-12-2025 |
31-12-2024 |
31-12-2025 |
31-12-2024 |
|
in € 1,000 |
in € 1,000 |
in € 1,000 |
||||
Investment property |
- |
- |
- |
- |
43,121 |
44,765 |
Investment property under development |
- |
- |
- |
- |
- |
1,271 |
Investments in associates |
- |
- |
- |
- |
3,545 |
3,402 |
Derivative financial instruments |
- |
- |
26 |
127 |
26 |
127 |
Deferred tax assets |
- |
- |
- |
- |
85 |
95 |
Tax assets |
- |
- |
- |
- |
153 |
60 |
Trade and other receivables |
- |
- |
580 |
483 |
10,503 |
1,631 |
Prepayments and deferred expenses |
4 |
4 |
- |
- |
267 |
245 |
Cash and cash equivalents |
206 |
529 |
- |
- |
2,391 |
2,419 |
Assets held for sale |
- |
- |
- |
- |
4,315 |
19,580 |
210 |
533 |
606 |
610 |
64,406 |
73,595 |
|
97
test
15
NOTES
TO
THE
CONSOLIDATED
FINANCIAL
STATEMENTS
SUBSIDIARIES
15.1.1
Consolidated subsidiaries
All subsidiaries of the Fund have been included in the consolidation. These are as follows:
31-12-2025 |
||||
Proportion |
Proportion |
|||
of shares |
of shares |
|||
Registered |
Country of |
held by the |
held by the |
|
Name of subsidiary |
office |
incorporation |
Parent |
Group |
In % |
In % |
|||
Arcona Capital RE Bohemia s.r.o. |
Prague |
Czechia |
100.0 |
N.a. |
Arcona Capital RE Slovakia s.r.o. |
Bratislava |
Slovakia |
100.0 |
N.a. |
Arcona Capital Real Estate Poland Sp. z o.o. |
Warsaw |
Poland |
100.0 |
N.a. |
Arcona Capital Real Estate Trio Sp. z o.o. |
Warsaw |
Poland |
100.0 |
N.a. |
Arcona Real Estate B.V. |
Amsterdam |
The Netherlands |
100.0 |
N.a. |
Arcona Poland B.V. |
Amsterdam |
The Netherlands |
N.a. |
100.0 |
Arcona Poland Project 5 Sp. z o.o. |
Warsaw |
Poland |
N.a. |
100.0 |
Aisi Bela LLC |
Kyiv |
Ukraine |
100.0 |
N.a. |
Arcona Black Sea Real Estate B.V. |
Amsterdam |
The Netherlands |
100.0 |
N.a. |
N-E Real Estate Park First Phase S.r.l. |
Bucharest |
Romania |
N.a. |
100.0 |
Aisi Ukraine LLC |
Kyiv |
Ukraine |
N.a. |
100.0 |
Trade Center LLC |
Kyiv |
Ukraine |
N.a. |
100.0 |
31-12-2024 |
||||
Proportion |
Proportion |
|||
of shares |
of shares |
|||
Registered |
Country of |
held by the |
held by the |
|
Name of subsidiary |
office |
incorporation |
Parent |
Group |
In % |
In % |
|||
Arcona Capital RE Bohemia s.r.o. |
Prague |
Czechia |
100.0 |
N.a. |
Arcona Capital RE Slovakia s.r.o. |
Bratislava |
Slovakia |
100.0 |
N.a. |
Arcona Capital Real Estate Poland Sp. z o.o. |
Warsaw |
Poland |
100.0 |
N.a. |
Arcona Capital Real Estate Trio Sp. z o.o. |
Warsaw |
Poland |
100.0 |
N.a. |
Arcona Real Estate B.V. |
Amsterdam |
The Netherlands |
100.0 |
N.a. |
Arcona Poland B.V. |
Amsterdam |
The Netherlands |
N.a. |
100.0 |
Arcona Poland Project 5 Sp. z o.o. |
Warsaw |
Poland |
N.a. |
100.0 |
Aisi Bela LLC |
Kyiv |
Ukraine |
100.0 |
N.a. |
Arcona Black Sea Real Estate B.V. |
Amsterdam |
The Netherlands |
100.0 |
N.a. |
N-E Real Estate Park First Phase S.r.l. |
Bucharest |
Romania |
N.a. |
100.0 |
Aisi Ukraine LLC |
Kyiv |
Ukraine |
N.a. |
100.0 |
Trade Center LLC |
Kyiv |
Ukraine |
N.a. |
100.0 |
15.1.2
Subsidiaries incorporated during the financial period
During the financial period, the Fund incorporated no subsidiaries.
15.1.3
Subsidiaries acquired during the financial period
During the financial period, the Fund acquired no subsidiaries.
98
15.1.4
Subsidiaries sold during the financial period
INVESTMENT PROPERTY
15.2.1
Analysis of investment property
31-12-2025 |
31-12-2024 |
|
In € 1,000 |
In € 1,000 |
|
Owned investment property |
41,600 |
44,709 |
Lease incentives |
56 |
56 |
Right-of-use assets |
1,465 |
- |
43,121 |
44,765 |
15.2.2
Analysis of owned investment property
31-12-2025 |
31-12-2024 |
|
In € 1,000 |
In € 1,000 |
|
Buildings (including underground) |
39,428 |
42,660 |
Land plots |
2,228 |
2,105 |
41,656 |
44,765 |
99
15.2.3
Specification of owned investment property
Name of property | Address | 31-12-2025 | 31-12-2024 |
In € 1,000 | In € 1,000 | ||
In ownership of Arcona Capital RE Bohemia s.r.o. (Czechia) | |||
Palmovka | Na Žertvách 34, Prague | N.a. | 4,264 |
Newton House | Politických Vězňu 10, Prague | 7,408 | 6,761 |
Subtotal | 7,408 | 11,025 | |
In ownership of Arcona Capital RE Slovakia s.r.o. (Slovakia) | |||
Letná | Letná 45, Košice | N.a. | 11,940 |
In ownership of Arcona Capital Real Estate Poland Sp. z o.o. (Poland) | |||
Laubitza | Laubitza 8, Inowroclaw | 1,940 | 1,980 |
Lecia Inowroclawia | 800-lecia Inowroclawia 27, Inowroclaw | 2,420 | 2,530 |
Krzemowa | Krzemowa 1, Gdansk | 3,260 | 3,240 |
Plutona | Plutona 1, Glogow | 2,000 | 1,920 |
Kalinkowa | Kalinkowa 82, Grudziadz | 2,790 | 2,850 |
Wojska Polsiekgo | Wojska Polskiego 137, Piotrkow Trybunalski | 3,210 | 3,210 |
Wolnosci | Wolnosci 6, Slupsk | 2,270 | Held for sale |
Subtotal | 17,890 | 15,730 | |
In ownership of Arcona Capital Real Estate Trio Sp. z o.o. (Poland) | |||
Kardynala Wyszynskiego | Kardynala Wyszynskiego 107, Lodz | 1,730 | Held for sale |
Legionow | Legionow 216, Torun | 3,140 | Held for sale |
4,870 | - | ||
In ownership of Arcona Capital Poland Project 5 Sp. z o.o. (Poland) | |||
Maris | Holdu Pruskiego 9 & 12 Malopolska 12, | 9,260 | Held for sale |
Szczecin | |||
In ownership of Aisi Bela LLC (Ukraine) | |||
Balabino Project | Territory of Balabynska Village Council, | Held for sale | - |
Zaporizkyi District, Zaporizhzhia Region | |||
In ownership of Aisi Ukraine LLC (Ukraine) | |||
Kiyanovskiy Residence | Kiyanovskiy Lane, Shevchenkisvkyi District, | 2,228 | 2,105 |
Kiev Region | |||
In ownership of N-E Real Estate Park First Phase S.r.l. (Romania) | |||
EOS Business Park | Strada Nicolae Cânea 140-160, Bucharest | Held for sale | 3,965 |
41,656 | 44,765 |
The Fund has identified the properties listed above as “Owned investment property”.
During the financial period the Fund retrieved 3 assets (Maris, Kardynala Wyszynskiego and Legionow) from
the market due to insufficient market demand. The anticipated sale of Wolnosci did not go through after a year
of discussions with the potential buyer. The Fund also retrieved this asset from the market.
Both Balabino Project and EOS Business Park were actively marketed during 2025/2026. The Fund considers
these 2 assets as “Assets held for sale”.
100
15.2.4
Statement of changes in owned investment property
2025 |
2024 |
|
In € 1,000 |
In € 1,000 |
|
Balance as at 1 January |
44,765 |
66,622 |
Acquisitions |
- |
1,979 |
Additions |
730 |
524 |
Fair value adjustments |
28 |
-/- 1,800 |
Exchange rate differences |
35 |
-/- 300 |
Reclassification (from “Assets held for sale”) |
16,400 |
- |
Reclassification (to “Assets held for sale”) |
-/- 20,302 |
-/- 22,260 |
Balance as at 31 December |
41,656 |
44,765 |
The “Reclassification (from “Assets held for sale”)” relate to the properties mentioned with “Held for sale” in
the comparative figures of section 15.2.3 “Specification of owned investment property.
The “Reclassification (to “Assets held for sale”)” for the amount of € 20,302,000 negative relates to the
properties:
-
Palmovka (Czechia);
-
Letná (Slovakia);
-
Balabino Project (Ukraine);
-
EOS Business Park (Romania).
15.2.5
Valuation of owned investment property
The owned investment property, as listed in section 15.2.3 “Specification of owned investment property”, was
valued by an external, independent appraiser as at Statement of Financial Position’s date.
The valuations are prepared for accounting purposes and are in accordance with relevant IFRS regulations as
mentioned in section 13.10.3 “Applied standard method of measurement”.
Specification of right-of-use assets
Nature of right-of-use asset |
Related to owned investment property |
31-12-2025 |
31-12-2024 |
In € 1,000 |
In € 1,000 |
||
Right-of-use held by Arcona Capital Real Estate Trio Sp. z o.o. (Poland) |
|||
Land lease |
Kardynala Wyszynskiego |
308 |
Held for sale |
Land lease |
Legionow |
1,157 |
Held for sale |
1,465 |
- |
101
15.2.7
Statement of changes in right-of-use assets
2025 |
2024 |
|
In € 1,000 |
In € 1,000 |
|
Balance as at 1 January |
- |
1,400 |
Remeasurement (as a result of an index / inflation) |
- |
186 |
Fair value adjustments |
- |
-/- 38 |
Reclassification (from “Assets held for sale”) |
1,465 |
- |
Reclassification (to “Assets held for sale”) |
- |
-/- 1,548 |
Balance as at 31 December |
1,465 |
- |
The “Reclassification (from “Assets held for sale)” for the amount of € 1,465,000 relates to the properties:
-
Kardynala Wyszynskiego (Poland) and
-
Legionow (Poland).
Valuation of right-of-use assets
The right-of-use assets, as listed in section 15.2.6 “Specification of right-of-use assets”, were not valued by an
external, independent appraiser as at Statement of Financial Position’s date. Right-of-use assets are initially
measured at cost, which compromises the initial amount of the lease liability adjusted by the amount of any
prepaid or accrued lease payment, less any lease incentives received. The right-of-use asset is subsequently
measured at cost (subject to certain exceptions), less accumulated depreciation and impairment losses. The
right-of-use asset will additionally be adjusted for any remeasurement of the lease liability, when applicable.
The Managing Board is of the opinion the above method is the most appropriate approach to the valuation of
102
15.2.9
Sensitivity analysis
The appraisal of the buildings including underground, hereinafter referred to as the Portfolio implies an average
weighted “Reversion Yield” of 7.9% (December 31, 2024: 8.2%).
In case the yields used for the appraisals of the Portfolio as at Statement of Financial Position’s date had been
50 basis points higher, the value of the Portfolio would have decreased by 6.5% (December 31, 2024: 6.6%).
In this situation, the Group equity would have been € 2,346,000 lower (December 31, 2024: € 3,328,000 lower).
In case the yields used for the appraisals of the Portfolio as at Statement of Financial Position’s date had been
50 basis points lower, the value of the Portfolio would have increased by 7.9% (December 31, 2024: 7.5%). In
this situation, the Group equity would have been € 2,849,000 higher (December 31, 2024: € 3,757,000 higher).
A sensitivity analysis with possible changes in Yield and Estimated Rental Value (
ERV
) results in the following
changes in portfolio value:
| 31-12-2025 | |||||
Change in | Change in yield | ||||
ERV | -/- 0.50% | -/- 0.25% | 0.00% | 0.25% | 0.50% |
-/- 5.0% | 3.3% | -/- 0.6% | -/- 4.2% | -/- 7.6% | -/- 10.8% |
-/- 2.5% | 5.6% | 1.6% | -/- 2.1% | -/- 5.6% | -/- 8.8% |
0.0% | 7.9% | 3.8% | 0.0% | -/- 3.4% | -/- 6.5% |
2.5% | 10.2% | 6.0% | 2.1% | -/- 1.6% | -/- 5.0% |
5.0% | 12.5% | 8.2% | 4.2% | 0.4% | -/- 3.1% |
| 31-12-2024 | |||||
Change in | Change in yield | ||||
ERV | -/- 0.50% | -/- 0.25% | 0.00% | 0.25% | 0.50% |
-/- 5.0% | 3.0% | -/- 0.7% | -/- 4.2% | -/- 7.4% | -/- 10.4% |
-/- 2.5% | 5.2% | 1.5% | -/- 2.1% | -/- 5.4% | -/- 8.5% |
0.0% | 7.5% | 3.6% | 0.0% | -/- 3.4% | -/- 6.6% |
2.5% | 9.7% | 5.7% | 2.0% | -/- 1.5% | -/- 4.7% |
5.0% | 12.0% | 7.9% | 4.1% | 0.5% | -/- 2.8% |
The ERV is the external appraisers’ opinion as to the open market rent which, on the date of valuation, could
reasonably be expected to be obtained on a new letting or rent review of an investment property.
15.3
INVESTMENT PROPERTY UNDER DEVELOPMENT
15.3.1
Specification of investment property under development
Name of property | Address | 31-12-2025 | 31-12-2024 |
In € 1,000 | In € 1,000 | ||
In ownership of Aisi Bela LLC (Ukraine) | |||
| Bela Logistic Park | Territory of Nerubaiske Village Council, | Held for | |
Biliayivskyi District, Odessa Region | sale | 1,271 |
103
15.3.2
Statement of changes in investment property under development
2025 |
2024 |
|
In € 1,000 |
In € 1,000 |
|
Balance as at 1 January |
1,271 |
945 |
Fair value adjustments |
-/- 11 |
366 |
Exchange rate differences |
-/- 89 |
-/- 40 |
Reclassification (to “Assets held for sale”) |
-/- 1,171 |
- |
Balance as at 31 December |
- |
1,271 |
INVESTMENTS IN ASSOCIATES
15.4.1
Specification of investments in associates
Pro- |
||||||
portion of |
||||||
Name of project |
Name of associate |
shares |
Country |
Asset |
31-12-2025 |
31-12-2024 |
held by |
type |
|||||
the Group |
||||||
In % |
In € 1,000 |
In € 1,000 |
||||
Lelar Holdings Limited |
||||||
| Delea Nuova |
and S.C. Delenco |
24.35 |
Romania |
Office |
3,545 |
3,402 |
| Project |
Construct S.r.l. |
building |
Delea Nuova Project
31-12-2025 |
31-12-2024 |
|
In € 1,000 |
In € 1,000 |
|
Non-current assets |
15,990 |
15,820 |
Current assets |
729 |
728 |
Shareholders’ equity |
14,556 |
13,967 |
Non-current liabilities |
1,955 |
1,881 |
Current liabilities |
208 |
700 |
Delea Nuova Project
2025 |
2024 |
|
In € 1,000 |
In € 1,000 |
|
Net rental and related income |
1,374 |
1,451 |
Net results on properties |
170 |
-/- 810 |
Profit for the period |
1,092 |
326 |
Other comprehensive income |
5 |
- |
Total comprehensive income |
1,097 |
326 |
15.4.2
Statement of changes in investments in associates
2025 |
2024 |
|
In € 1,000 |
In € 1,000 |
|
Balance as at 1 January |
3,402 |
3,689 |
Fair value adjustments |
143 |
-/- 287 |
Balance as at 31 December |
3,545 |
3,402 |
The “Fair value adjustments” for the amount of € 143,000 consists of the following amounts:
•
share in result of investments in associates for an amount of € 266,000; less
•
dividend for an amount of € 123,000, which is recognised in the Consolidated Income Statement.
104
DERIVATIVE FINANCIAL INSTRUMENTS
15.5.1
Specification of derivative financial instruments
31-12-2025 |
31-12-2024 |
|
In € 1,000 |
In € 1,000 |
|
Non-current part of derivative financial instruments |
- |
24 |
Current part of derivative financial instruments |
26 |
103 |
26 |
127 |
15.5.2
Specification of derivative financial instruments
31-12-2025 |
31-12-2024 |
|
In € 1,000 |
In € 1,000 |
|
Interest rate swaps used for hedging |
26 |
127 |
105
RECOGNISED DEFERRED TAXES
15.6.1
Specification of recognised deferred taxes
| 31-12-2025 |
|||
Recognised |
Recognised |
Total |
|
deferred tax |
deferred tax |
recognised |
|
assets |
liabilities |
deferred taxes |
|
In € 1,000 |
In € 1,000 |
In € 1,000 |
|
Owned investment property |
276 |
627 |
-/- 351 |
Receivables from shareholders and other group companies |
- |
26 |
-/- 26 |
Subtotal non-current investments |
276 |
653 |
-/- 377 |
Tax losses (carried forward) |
274 |
- |
274 |
Trade and other receivables |
4 |
67 |
-/- 63 |
Prepayments and deferred expenses |
44 |
10 |
34 |
(Interest) receivables from shareholders and group |
|||
| companies |
- |
23 |
-/- 23 |
Loans and borrowings |
- |
150 |
-/- 150 |
Loans due to shareholders and other group companies |
- |
83 |
-/- 83 |
Derivative financial instruments |
- |
4 |
-/- 4 |
Trade and other payables |
36 |
- |
36 |
Deferred taxes before set-off |
634 |
990 |
-/- 356 |
Set-off deferred taxes |
-/- 549 |
-/- 549 |
- |
85 |
441 |
-/- 356 |
|
| 31-12-2024 |
|||
Recognised |
Recognised |
Total |
|
deferred tax |
deferred tax |
recognised |
|
assets |
liabilities |
deferred taxes |
|
In € 1,000 |
In € 1,000 |
In € 1,000 |
|
Owned investment property |
268 |
2,557 |
-/- 2,289 |
Receivables from shareholders and other group companies |
- |
26 |
-/- 26 |
Subtotal non-current investments |
268 |
2,583 |
-/- 2,315 |
Tax losses (carried forward) |
200 |
- |
200 |
Trade and other receivables |
12 |
2 |
10 |
Prepayments and deferred expenses |
73 |
5 |
68 |
(Interest) receivables from shareholders and group |
|||
| companies |
- |
40 |
-/- 40 |
Assets held for sale |
1 |
319 |
-/- 318 |
Loans and borrowings |
- |
139 |
-/- 139 |
Loans due to shareholders and other group companies |
- |
56 |
-/- 56 |
Derivative financial instruments |
- |
19 |
-/- 19 |
Trade and other payables |
57 |
- |
57 |
Deferred taxes before set-off |
611 |
3,163 |
-/- 2,552 |
Set-off deferred taxes |
-/- 516 |
-/- 516 |
- |
95 |
2,647 |
-/- 2,552 |
|
An allocation of the recognised deferred tax assets to the various geographic segments is presented in section
14.5.5 “Overview of geographic assets (overview C)”.
106
15.6.2
Analysis of recognised deferred tax assets concerning tax losses (carried forward)
31-12-2025 |
31-12-2024 |
|
In € 1,000 |
In € 1,000 |
|
Expires in 2025 |
- |
43 |
Expires in 2028 |
18 |
- |
Expires in 2029 |
- |
13 |
Expires in 2030 |
90 |
- |
Subtotal will expire |
108 |
56 |
Will never expire |
166 |
144 |
274 |
200 |
Based on the tax forecast the Managing Board expects (considering local tax law and regulations) that in the
future there will be sufficient taxable profit to set-off these recognised tax losses.
15.6.3
Statement of changes in recognised deferred taxes
2025 |
2024 |
|
In € 1,000 |
In € 1,000 |
|
Balance as at 1 January |
-/- 2,552 |
-/- 3,426 |
Adjustments related to prior years |
-/- 8 |
19 |
Additions / withdrawals |
2,478 |
839 |
Change in tax rate |
-/- 242 |
3 |
Exchange rate differences |
-/- 32 |
13 |
Balance as at 31 December |
-/- 356 |
-/- 2,552 |
107
UNRECOGNISED DEFERRED TAXES
15.7.1
Specification of unrecognised deferred taxes
| 31-12-2025 |
|||
Unrecognised |
Unrecognised |
Total |
|
deferred tax |
deferred tax |
unrecognised |
|
assets |
liabilities |
deferred taxes |
|
In € 1,000 |
In € 1,000 |
In € 1,000 |
|
Owned investment property |
484 |
84 |
400 |
Receivables from shareholders and group companies |
719 |
- |
719 |
Tax losses (carried forward) |
2,940 |
- |
2,940 |
Assets held for sale |
224 |
425 |
-/- 201 |
Trade and other receivables |
9 |
- |
9 |
Trade and other payables |
51 |
- |
51 |
Interest due to shareholders and other |
|||
| group companies |
335 |
- |
335 |
Tax assets |
3 |
- |
3 |
4,765 |
509 |
4,256 |
|
| 31-12-2024 |
|||
Unrecognised |
Unrecognised |
Total |
|
deferred tax |
deferred tax |
unrecognised |
|
assets |
liabilities |
deferred taxes |
|
In € 1,000 |
In € 1,000 |
In € 1,000 |
|
Owned investment property |
419 |
620 |
-/- 201 |
Investment property under development |
235 |
- |
235 |
Receivables from shareholders and group companies |
415 |
- |
415 |
Tax losses (carried forward) |
2,882 |
- |
2,882 |
Trade and other receivables |
4 |
- |
4 |
Trade and other payables |
4 |
- |
4 |
Interest due to shareholders and other |
|||
| group companies |
297 |
- |
297 |
Tax assets |
4 |
- |
4 |
4,260 |
620 |
3,640 |
|
108
15.7.2
Analysis of unrecognised deferred tax assets concerning tax losses (carried forward)
31-12-2025 |
31-12-2024 |
|
In € 1,000 |
In € 1,000 |
|
Expires in 2026 |
98 |
97 |
Expires in 2028 |
6 |
24 |
Expires in 2029 |
48 |
33 |
Expires in 2030 |
47 |
- |
Subtotal will expire |
199 |
154 |
Will never expire |
2,741 |
2,728 |
2,940 |
2,882 |
The Managing Board expects (considering local tax law and regulations) that in the future there will be
insufficient taxable profit to set-off these unrecognised tax losses.
The unrecognised deferred tax assets concerning tax losses (carried forward) which will never expire relates
mainly to incurred tax losses of the Parent Company. Mainly as a result of applying the participation exemption
in the Netherlands it is expected the Parent Company will not generate taxable profits in the (near) future.
Therefore, the Managing Board is of the opinion no deferred tax assets can be recognised for these tax losses
(carried forward).
15.7.3
Statement of changes in unrecognised deferred taxes
2025 |
2024 |
|
In € 1,000 |
In € 1,000 |
|
Balance as at 1 January |
3,640 |
3,652 |
Adjustments related to prior years |
-/- 5 |
21 |
Additions as a result of acquisition of subsidiaries |
- |
157 |
Withdrawals as a result of sale of subsidiaries |
- |
-/- 250 |
Additions / withdrawals |
687 |
79 |
Change in tax rate |
-/- 6 |
1 |
Exchange rate differences |
-/- 60 |
-/- 20 |
Balance as at 31 December |
4,256 |
3,640 |
TAX ASSETS
15.8.1
Specification of tax assets
31-12-2025 |
31-12-2024 |
|
In € 1,000 |
In € 1,000 |
|
Non-current part of tax assets |
- |
- |
Current part of tax assets |
153 |
60 |
153 |
60 |
109
15.8.2
Specification of tax assets
31-12-2025 |
31-12-2024 |
|
In € 1,000 |
In € 1,000 |
|
Corporate income tax ( CIT ) |
136 |
54 |
Value added tax ( VAT ) |
17 |
- |
Property tax |
- |
6 |
153 |
60 |
TRADE AND OTHER RECEIVABLES
Analysis of trade and other receivables
31-12-2025 |
31-12-2024 |
|
In € 1,000 |
In € 1,000 |
|
Non-current part of trade and other receivables |
193 |
956 |
Current part of trade and other receivables |
10,310 |
675 |
10,503 |
1,631 |
The “Non-current part of trade and other receivables” for the amount of € 193,000 relates completely to the
“Debt Service Reserve Account (DSRA)”, which must be maintained based on the bank covenants for secured
bank loans. Since a few secured bank loans are entirely classified as current as at Statement of Financial
Position’s date, the corresponding amount of DSRA is also (entirely) classified as current. Once the
corresponding secured bank loan will be (largely) classified as non-current, also the corresponding amount of
DSRA will be classified as non-current.
Specification of trade and other receivables
31-12-2025 |
31-12-2024 |
|
In € 1,000 |
In € 1,000 |
|
Sold properties |
8,200 |
- |
Debt Service Reserve Account ( DSRA ) |
1,164 |
956 |
Contract assets |
720 |
- |
Trade receivables |
301 |
445 |
Receivable dividend from associates |
- |
122 |
Invoiceable amounts |
6 |
92 |
(Claim) termination derivative financial instruments (interest rate swap) |
4 |
4 |
Interest income |
3 |
3 |
Other trade and other receivables |
105 |
9 |
10,503 |
1,631 |
The “Sold properties” for the amount of € 8,200,000 relates to the property Letná (Slovakia), which has been
110
15.9.3
Analysis of contract assets
31-12-2025 |
31-12-2024 |
|
In € 1,000 |
In € 1,000 |
|
Contract assets (gross) |
720 |
- |
Total expected credit losses for contract assets |
- |
- |
720 |
- |
The “Contract assets (gross)” for the amount of € 720,000 relates solely to the receivable towards the lessor
(owner) of the land of the property Grzymaly Siedleckiego (Bydgoszcz in Poland).
As of January 16, 2025, the land lease for Grzymaly Siedleckiego has expired. As a result, the commercial
and legal title of the property (building) will automatically be transferred to the lessor (owner) of the land. This
obliges the lessor to compensate the Fund in an amount equivalent to either the unamortised building cost or
the market value, whichever is lower. In this context, it is the view of the Managing Board that “market value”
refers to the value of the property to the lessor upon reversion - an unencumbered freehold without a head
leasehold interest - allowing a ten or fifteen-year lease to be granted to an occupational tenant, excluding the
ground component. The Managing Board has been advised by external appraisers that this “market value” is
higher than the unamortised building costs shown in the Fund’s account of € 1,380,000. The Managing Board
is therefore of the opinion that € 1,380,000 is the most appropriate amount of compensation payment due from
the lessor. However, this figure is disputed by the lessor, based partly on valuation methodology and partly on
tax depreciation practices. As a result, there is a material valuation uncertainty regarding the compensation
amount due to the Fund.
In January 2025, the Fund received a payment of approximately PLN 628,000 (approximately € 148,000),
including VAT from the lessor as partial payment of the due compensation. The Fund is currently in legal
proceeding with the lessor to agree on additional compensation amounts and is seeking to resolve the matter
through mutual agreement.
15.9.4
Analysis of trade receivables
31-12-2025 |
31-12-2024 |
|
In € 1,000 |
In € 1,000 |
|
Trade receivables (gross) |
576 |
731 |
Total expected credit losses for trade receivables |
-/- 275 |
-/- 286 |
301 |
445 |
Expected credit losses for trade receivables
The Fund always measures the loss allowance for trade receivables at an amount equal to lifetime expected
credit losses. There are no trade receivables which contain a significant finance component. The Fund has
chosen to apply the “simplified model” for the calculation of the loss allowance for trade receivables. The
expected credit loss-rate is based on historical information (chosen is a 5-year history), whereby the historical
default loss percentage is adjusted for forecast information. The Fund presumed that all trade receivables are
homogenous. Usually, the Fund has recognised a loss allowance of 100% for collective assessed expected
credit losses with regard to trade receivables over one year past due (after reduction of recoverable value
added tax), because historical experience has indicated that these trade receivables are generally not
recoverable.
There has been no change in the estimation techniques or significant assumptions made during the current
reporting period.
111
The Fund writes-off on a trade receivable when there is information indicating the debtor is in severe financial
difficulty and there is no realistic prospect of recovery, e.g. when the debtor has been placed into liquidation
15.9.6
Risk profile of trade receivables
The following table details the risk profile of trade receivables based on the Fund’s provision matrix.
31-12-2025 |
||||||
More |
||||||
Not |
Up to |
1 to |
3 months |
than 1 |
||
past |
1 month |
3 months |
to 1 year |
year |
||
due |
past due |
past due |
past due |
past due |
Total |
|
Expected credit loss rate |
4.5% |
1.9% |
12.5% |
34.5% |
98.8% |
|
Trade receivables (gross) |
||||||
(in € 1,000) |
223 |
53 |
16 |
29 |
255 |
576 |
Collective assessed expected credit |
||||||
losses (in € 1,000) |
-/- 10 |
-/- 1 |
-/- 2 |
-/- 10 |
-/- 252 |
-/- 275 |
Individually assessed expected |
||||||
credit losses (in € 1,000) |
- |
- |
- |
- |
- |
- |
Trade receivables (net) (in € 1,000) |
213 |
52 |
14 |
19 |
3 |
301 |
31-12-2024 |
||||||
More |
||||||
Not |
Up to |
1 to |
3 months |
than 1 |
||
past |
1 month |
3 months |
to 1 year |
year |
||
due |
past due |
past due |
past due |
past due |
Total |
|
Expected credit loss rate |
4.2% |
4.6% |
11.8% |
82.9% |
99.2% |
|
Trade receivables (gross) |
||||||
(in € 1,000) |
333 |
108 |
17 |
35 |
238 |
731 |
Collective assessed expected credit |
||||||
losses (in € 1,000) |
-/- 14 |
-/- 5 |
-/- 2 |
-/- 29 |
-/- 236 |
-/- 286 |
Individually assessed expected |
||||||
credit losses (in € 1,000) |
- |
- |
- |
- |
- |
- |
Trade receivables (net) (in € 1,000) |
319 |
103 |
15 |
6 |
2 |
445 |
112
15.9.7
Movement in lifetime expected credit losses for trade receivables
The following table shows the movement in lifetime expected credit losses that has been recognised for trade
and other receivables in accordance with the “simplified approach” as set out in IFRS 9.
| 2025 |
|||
Collective |
Individually |
||
assessed |
assessed |
||
expected credit |
expected credit |
Total expected |
|
losses |
losses |
credit losses |
|
In € 1,000 |
In € 1,000 |
In € 1,000 |
|
Balance as at 1 January |
286 |
- |
286 |
Amounts recovered |
-/- 24 |
- |
-/- 24 |
Change in loss allowance due to new trade and |
|||
other receivables originated net of those |
13 |
- |
13 |
derecognised due to settlement |
|||
Balance as at 31 December |
275 |
- |
275 |
| 2024 |
|||
Collective |
Individually |
||
assessed |
assessed |
||
expected credit |
expected credit |
Total expected |
|
losses |
losses |
credit losses |
|
In € 1,000 |
In € 1,000 |
In € 1,000 |
|
Balance as at 1 January |
386 |
- |
386 |
Amounts written-off |
-/- 107 |
- |
-/- 107 |
Amounts recovered |
-/- 53 |
- |
-/- 53 |
Change in loss allowance due to new trade and |
|||
other receivables originated net of those |
76 |
- |
76 |
derecognised due to settlement |
|||
Exchange rate differences |
-/- 16 |
- |
-/- 16 |
Balance as at 31 December |
286 |
- |
286 |
PREPAYMENTS AND DEFERRED EXPENSES
15.10.1
Analysis of prepayments and deferred expenses
31-12-2025 |
31-12-2024 |
|
In € 1,000 |
In € 1,000 |
|
Non-current part of prepayments and deferred expenses |
4 |
1 |
Current part of prepayments and deferred expenses |
263 |
244 |
267 |
245 |
15.10.2
Specification of prepayments and deferred expenses
31-12-2025 |
31-12-2024 |
|
In € 1,000 |
In € 1,000 |
|
Deferred expenses |
218 |
166 |
Prepayments |
49 |
79 |
267 |
245 |
113
CASH AND CASH EQUIVALENTS
The cash and cash equivalents are at the free disposal of the Fund, with the exception of € 290,000
(December 31, 2024: € 237,000), which amount is retained on reserve accounts (e.g. “Security Deposit
Account”, “Repair Reserve Account” and “CAPEX Account”).
15.11.1
Specification of cash and cash equivalents
31-12-2025 |
31-12-2024 |
|
In € 1,000 |
In € 1,000 |
|
Bank balances |
2,167 |
2,171 |
Deposits |
222 |
247 |
Cash |
2 |
1 |
2,391 |
2,419 |
ASSETS HELD FOR SALE
15.12.1
Analysis of assets held for sale
31-12-2025 |
31-12-2024 |
|
In € 1,000 |
In € 1,000 |
|
Owned investment property held for sale |
3,272 |
18,055 |
Lease incentives held for sale |
- |
15 |
Right-of-use assets held for sale |
- |
1,510 |
Investment property under development held for sale |
1,043 |
- |
4,315 |
19,580 |
15.12.2
Analysis of owned investment property held for sale
31-12-2025 |
31-12-2024 |
|
In € 1,000 |
In € 1,000 |
|
Buildings (including underground) |
3,272 |
18,070 |
Land plots |
- |
N.a. |
3,272 |
18,070 |
114
Specification of owned investment property held for sale
Name of property |
Address |
31-12-2025 |
31-12-2024 |
In € 1,000 |
In € 1,000 |
||
In ownership of Arcona Capital RE Bohemia s.r.o. (Czechia) |
|||
Palmovka |
Na Žertvách 34, Prague |
Sold |
Owned IP |
In ownership of Arcona Capital RE Slovakia s.r.o. (Slovakia) |
|||
Letná |
Letná 45, Košice |
Sold |
Owned IP |
In ownership of Arcona Capital Real Estate Poland Sp. z o.o. (Poland) |
|||
Wolnosci |
Wolnosci 6, Slupsk |
Owned IP |
2,260 |
In ownership of Arcona Capital Real Estate Trio Sp. z o.o. (Poland) |
|||
Grzymaly |
Grzymaly Siedleckiego 20, Bydgoszcz |
||
Siedleckiego |
Sold |
1,380 |
|
Kardynala |
|||
Wyszynskiego |
Kardynala Wyszynskiego 107, Lodz |
Owned IP |
1,870 |
Legionow |
Legionow 216, Torun |
Owned IP |
3,170 |
Subtotal |
- |
6,420 |
|
In ownership of Arcona Capital Poland Project 5 Sp. z o.o. (Poland) |
|||
| Maris |
Holdu Pruskiego 9 & 12 Malopolska 12, |
Owned IP |
9,390 |
| Szczecin |
|||
In ownership of Aisi Bela LLC (Ukraine) |
|||
Balabino Project |
Territory of Balabynska Village Council, |
- |
Owned IP |
Zaporizkyi District, Zaporizhzhia Region |
|||
In ownership of N-E Real Estate Park First Phase S.r.l. (Romania) |
|||
EOS Business Park |
Strada Nicolae Cânea 140-160, Bucharest |
3,272 |
Owned IP |
3,272 |
18,070 |
15.12.4
Statement of changes in owned investment property held for sale
2025 |
2024 |
|
In € 1,000 |
In € 1,000 |
|
Balance as at 1 January |
18,070 |
5,176 |
Additions |
285 |
531 |
Fair value adjustments |
-/- 4,336 |
283 |
Exchange rate differences |
-/- 33 |
- |
Disposals |
-/- 14,616 |
-/- 10,180 |
Reclassification (from “Owned investment property”) |
20,302 |
22,260 |
Reclassification (to “Owned investment property”) |
-/- 16,400 |
- |
Balance as at 31 December |
3,272 |
18,070 |
115
The “Reclassification (from “Owned investment property”)” for the amount of € 20,302,000 relates to the
properties:
-
Palmovka (Czechia);
-
Letná (Slovakia);
-
Balabino Project (Ukraine) and
-
EOS Business Park (Romania).
The “Reclassification (to “Owned investment property”)” relate to the properties mentioned with “Owned IP” in
section 15.12.3 “Specification of owned investment property held for sale”.
The “Disposals” for the amount of € 14,616,000 negative relates to the sale of the properties:
-
Grzymaly Siedleckiego (Poland) as of January 16, 2025 for an amount of € 840,000;
-
Palmovka (Czechia) as of May 28, 2025 for an amount of € 5,576,000 (CZK 137,468,000) and
-
Letná (Slovakia) as of December 29, 2025 for an amount of € 8,200,000.
As of January 16, 2025, the land lease for Grzymaly Siedleckiego has expired and the commercial and legal
title of the property (building) has automatically been transferred to the lessor (owner) of the land. For further
information reference is made to section 15.9.3 “Analysis of contract assets”.
15.12.5
Valuation of owned investment property held for sale
The owned investment property held for sale, as listed in section 15.12.3 “Specification of owned investment
property held for sale”, has been valued by an external, independent appraiser as of the Statement of Financial
Position’s date, except for the Zaporizhzhia plot (Ukraine).
The valuations are prepared for accounting purposes and are in accordance with relevant IFRS regulations as
mentioned in section 13.10.3 “Applied standard method of measurement”.
Regarding the Zaporizhzhia plot, the Managing Board decided, given the current situation in Ukraine and the
plot’s proximity to the active front lines, to maintain the value of the land plot at zero. The situation will be
reviewed regularly in consultation with the Fund’s local advisors. For the general valuation uncertainty and
sensitivity analyses, reference is made to section 15.2.9, “Sensitivity Analysis.” For the properties valued by
an external independent appraiser, similar uncertainties and sensitivities are applicable.
15.12.6
Specification of investment property under development held for sale
Name of property | Address | 31-12-2025 | 31-12-2024 |
In € 1,000 | In € 1,000 | ||
In ownership of Aisi Bela LLC (Ukraine) | |||
Territory of Nerubaiske Village Council, | IP under | ||
Bela Logistic Park | Biliayivskyi District, Odessa Region | 1,043 | development |
The Fund has identified the properties listed above as “Investment property under development held for sale”.
116
15.12.7
Statement of changes in investment property under development held for sale
2025 | 2024 | |
In € 1,000 | In € 1,000 | |
Balance as at 1 January | - | - |
Fair value adjustments | -/- 70 | - |
Exchange rate differences | -/- 58 | - |
Reclassification (from “Investment property under development”) | 1,171 | - |
Balance as at 31 December | 1,043 | - |
15.12.8
Valuation of investment property under development held for sale
The investment property under development held for sale, as listed in section 15.12.6 “Specification of
investment property under development held for sale”, was valued by an external, independent appraiser as
at Statement of Financial Position’s date.
The valuations are prepared for accounting purposes and are in accordance with relevant IFRS regulations as
mentioned in section 13.10.3 “Applied standard method of measurement”.
The fair value of investment property under development held for sale is primarily derived using the “Market
approach” based on comparable properties in the market.
An external, independent appraiser has stated that there remains a significantly higher-than-usual level of
uncertainty regarding the reported value of the land. The key external risks identified are:
1.
Market Disruptions and Data Limitations. The valuation has been conducted under conditions of
extreme market uncertainty due to the ongoing war in Ukraine. The real estate market continues to
be affected by military operations, economic instability, and disrupted investment flows. As of the
valuation date, the appraiser faces a unique set of circumstances, including a lack of high-quality
market data and comparable transactions. This situation is caused by the significant decline in
transaction volumes and the limited availability ofmarket evidence to support valuations.
2.
Volatility and Economic Risks. The value of the land is likely to experience continued volatility over
time. The long-term impact of the war remains uncertain, affecting economic recovery and the
availability of external financing. Market conditions may change rapidly due to geopolitical
developments, regulatory adjustments, or shifts in investor sentiment. Given these factors, the
appraiser strongly recommends that the Managing Board review the valuation of the land plot on a
frequent basis.
Additionally, the appraiser has issued a "Material Valuation Uncertainty" disclaimer in accordance with RICS
guidelines (VPS 3 and VPGA 10 of the RICS Red Book Global). Consequently, greater caution should be
exercised when interpreting the valuation outcome, as it does cannot guarantee the value that may be obtained
in an open market.
15.12.9
Specification of right-of-use assets held for sale
Nature of right-of-use asset | Related to owned investment property | 31-12-2025 | 31-12-2024 |
In € 1,000 | In € 1,000 | ||
Right-of-use held by Arcona Capital Real Estate Trio Sp. z o.o. (Poland) | |||
Land lease | Grzymaly Siedleckiego | N.a. | 4 |
Land lease | Kardynala Wyszynskiego | ROU asset | 364 |
Land lease | Legionow | ROU asset | 1,142 |
- | 1,510 |
117
15.12.10 Statement of changes in right-of-use assets held for sale
2025 |
2024 |
|
In € 1,000 |
In € 1,000 |
|
Balance as at 1 January |
1,510 |
77 |
Remeasurement (as a result of an index / inflation) |
52 |
12 |
Fair value adjustments |
-/- 97 |
-/- 127 |
Reclassification (from “Right-of-use assets”) |
- |
1,548 |
Reclassification (to “Right-of-use assets”) |
-/- 1,465 |
- |
Balance as at 31 December |
- |
1,510 |
15.12.11 Valuation of right-of-use assets held for sale
The right-of-use assets held for sale, as listed in section 15.12.9 “Specification of right-of-use assets held for
sale”, were not valued by an external, independent appraiser as at Statement of Financial Position’s date.
Right-of-use assets held for sale are initially measured at cost, which compromises the initial amount of the
lease liability directly associated with assets held for sale adjusted by the amount of any prepaid or accrued
lease payment, less any lease incentives received. The right-of-use asset held for sale is subsequently
measured at cost (subject to certain exceptions), less accumulated depreciation and impairment losses. The
right-of-use asset held for sale will additionally be adjusted for any remeasurement of the lease liability directly
associated with assets held for sale, when applicable.
The Managing Board is of the opinion the above method is the most appropriate approach to the valuation of
GROUP EQUITY
15.13.1 General
For the general disclosures of Group Equity reference is made to section 19.8.1 “Closed-end structure” and
19.8.2 “Capital management”.
15.13.2 Equity components
For the analysis and statements of changes in the various equity components reference is made to section
19.8.3 “Statement of changes in shareholders’ equity”.
15.13.3
Settlement of acquisitions through share-based payments
During the financial period, the following (final) settlements of acquisitions through share-based payments took
place:
•
as at February 6, 2025 the Managing Board provided 68,782 registered shares of the Fund to SPDI
as part of the (final) settlement for the acquisition of a 100%-stake in Aisi Ukraine LLC at an issuance
price of € 11.16 per registered share;
•
as at February 6, 2025 the Managing Board provided 10,689 registered shares of the Fund to SPDI
as part of the (final) settlement for the acquisition of a 100%-stake in N-E Real Estate Park S.r.l. and
a 24.35%-stake in Lelar Holdings Limited at an issuance price of € 11.16 per registered share.
Share buy-back / Reverse Bookbuilding
Following the General Meeting of Shareholders (GM) of the Fund dated June 25, 2025, the GM approved the
proposal of the members of the Stichting Prioriteit (the Priority) to cancel the 294,118 pieces of treasury shares,
which has been repurchased by the Fund during the Reverse Bookbuilding Tender Offer period (from
September 19, 2024 to October 16, 2024) and to reduce the Parent Company’s issued capital for the same
118
TAX LIABILITIES
15.14.1
Specification of tax liabilities
31-12-2025 |
31-12-2024 |
|
In € 1,000 |
In € 1,000 |
|
Non-current part of tax liabilities |
- |
- |
Current part of tax liabilities |
1,555 |
707 |
1,555 |
707 |
15.14.2
Analysis of tax liabilities
31-12-2025 |
31-12-2024 |
|
In € 1,000 |
In € 1,000 |
|
Corporate income tax ( CIT ) |
1,412 |
583 |
Value added tax ( VAT ) |
53 |
81 |
Withholding tax ( WHT ) |
53 |
40 |
Property tax |
36 |
1 |
Other tax liabilities |
1 |
2 |
1,555 |
707 |
The “Corporate income tax (CIT)” for the amount of € 1,412,000 relates mainly to the corresponding CIT with
LOANS AND BORROWINGS
15.15.1
Analysis of loans and borrowings
| 31-12-2025 |
|||
Non-current |
Current |
||
Kind of loans and borrowings |
liabilities |
liabilities |
Total |
In € 1,000 |
In € 1,000 |
In € 1,000 |
|
Secured bank loans |
1,027 |
16,778 |
17,805 |
Lease liabilities |
1,393 |
100 |
1,493 |
Other loans and borrowings |
250 |
1,508 |
1,758 |
2,670 |
18,386 |
21,056 |
|
| 31-12-2024 |
|||
Non-current |
Current |
||
Kind of loans and borrowings |
liabilities |
liabilities |
Total |
In € 1,000 |
In € 1,000 |
In € 1,000 |
|
Secured bank loans |
16,526 |
4,002 |
20,528 |
Lease liabilities |
- |
- |
- |
Other loans and borrowings |
250 |
1,764 |
2,014 |
16,776 |
5,766 |
22,542 |
|
119
15.15.2
Statement of changes in secured bank loans
2025 | 2024 | |
In € 1,000 | In € 1,000 | |
Balance as at 1 January | 20,528 | 26,505 |
Loans advanced | 594 | 3,200 |
Redemptions | -/- 3,462 | -/- 9,113 |
(Amortisation) flat fee and transaction costs | 67 | 40 |
Exchange rate differences | 78 | -/- 104 |
Balance as at 31 December | 17,805 | 20,528 |
The “Loans advanced” for the amount of € 594,000 relates to the (partial) use of a development loan from
UniCredit for financing the refurbishment and extension of the investment property Newton House (Czechia),
with completion scheduled for Q3 2026.
15.15.3
Analysis of secured bank loans
| 31-12-2025 | |||||
Weighted | |||||
Name of | average | ||||
credit | Date of | interest | Face | Carrying | |
Name of company | institution | maturity | rate 9 | value | amount |
In % | In € 1,000 | In € 1,000 | |||
Arcona Capital RE Bohemia s.r.o. | UniCredit | 31-12-2028 | 5.60 | 1,056 | 1,029 |
Arcona Capital RE Slovakia s.r.o. | Slovenská | ||||
Sporiteľňa | 31-12-2029 | 4.50 | 3,025 | 3,025 | |
Arcona Capital Real Estate Poland Sp. | |||||
| z o.o. & Arcona Poland Project 5 Sp. z o.o. | Hypo Noe | 31-03-2026 | 5.06 | 11,480 | 11,473 |
Patria | |||||
N-E Real Estate Park First Phase S.r.l. | Bank | 10-12-2031 | 5.58 | 2,324 | 2,278 |
17,885 | 17,805 | ||||
| 31-12-2024 | |||||
Weighted | |||||
Name of | average | ||||
credit | Date of | interest | Face | Carrying | |
Name of company | institution | maturity | rate | value | amount |
In % | In € 1,000 | In € 1,000 | |||
Arcona Capital RE Bohemia s.r.o. | UniCredit | 31-12-2028 | 6.29 | 2,854 | 2,831 |
| Arcona Capital RE Slovakia s.r.o. | Slovenská | ||||
| Sporiteľňa | 31-12-2029 | 5.21 | 3,158 | 3,140 | |
Arcona Capital Real Estate Poland Sp. | |||||
z o.o. & Arcona Poland Project 5 Sp. z o.o. | Hypo Noe | 31-03-2026 | 6.11 | 12,040 | 11,989 |
N-E Real Estate Park First Phase S.r.l. | Patria Bank | 10-12-2031 | 6.83 | 2,622 | 2,568 |
20,674 | 20,528 | ||||
The fair value of the secured bank loans does not deviate substantially from the carrying amount, since the
applicable interest rate as at Statement of Financial Position’s date are comparable to the market interest rate
for comparable loans.
120
Securities provided, bank covenants and ratios secured bank loans
As at Statement of Financial Position’s date the following securities were provided, and bank covenants agreed
with regard to the secured bank loans. The ratios, as well as the withdrawable credit facilities as at Statement
of Financial Position’s date are also mentioned.
Slovenská |
Hypo |
Patria |
||
UniCredit |
Sporiteľňa |
Noe |
Bank |
|
Carrying amounts securities provided: |
||||
• Owned investment property (in € 1,000) |
7,408 |
- |
27,150 |
- |
• Assets held for sale (in € 1,000) |
- |
- |
- |
3,272 |
• Trade and other receivables (in € 1,000) |
194 |
8,351 |
825 |
247 |
• Cash and cash equivalents (in € 1,000) |
696 |
133 |
963 |
228 |
Bank covenants: |
||||
• Debt Service Coverage Ratio ( DSCR ) |
||||
| (minimum) |
1.20 |
1.25 |
0.95 |
1.30 |
• Debt Service Reserve Account ( DSRA ) |
||||
| (in € 1,000) |
30 11 |
150 |
580 |
240 12 |
• Capital expenditure ( CAPEX ) (in € 1,000) |
62 13 |
40 |
N.a. |
N.a. |
• Minimum total annual collection in the bank |
||||
| account (in € 1,000) |
N.a. |
N.a. |
N.a. |
589 14 |
• Loan to value (maximum) |
60.00% |
45.00% |
44.00% |
N.a. |
• Equity / liabilities |
N.a. |
10.00% |
N.a. |
N.a. |
• Negative equity borrower |
N.a. |
N.a. |
No 15 |
N.a. |
• Issued shares borrower pledged |
No |
No |
Yes 16 |
No |
• Contractual testing date(s) of bank |
30.06 & |
30.06 & |
||
| covenants |
31.12 |
31.12 |
Quarterly 17 |
31.12 |
Ratios: |
||||
Debt Service Coverage Ratio ( DSCR ) |
1.71 |
1.72 |
1.30 |
0.42 |
Loan to value ( LTV ) |
14.26% |
36.89% |
42.28% |
71.02% |
Withdrawable credit facilities: |
||||
Maximum credit facilities |
2,516 |
3,025 |
11,480 |
2,324 |
Outstanding amount |
1,056 |
3,025 |
11,480 |
2,324 |
Withdrawable credit facilities |
1,460 18 |
- |
- |
- |
For further information on pledged issued shares of the borrower reference is made to section 19.1.3
“Securities provided”.
11
In accordance with the bank covenant CZK 720,000.
12
In accordance with the bank covenant the Debt Service Reserve account (DSRA) has to be built up monthly with an amount of € 5,000
until an amount of € 265,000 is reached.
13
In accordance with the bank covenant CZK 1,500,000.
14
In accordance with the bank covenant RON 3,000,000.
15
Each borrower (Arcona Capital Real Estate Poland Sp. z o.o. and Arcona Poland Project 5 Sp. z o.o.) has to ensure that, at all times,
its total assets increased by the aggregate of the subordinated liabilities then outstanding are greater than its total liabilities. For the
purpose of this calculation contingent and prospective liabilities will not be considered and liabilities under subordinated shareholders loan
will be treated as equity and not as liabilities.
16
Only the shares in Arcona Capital Real Estate Poland Sp. z o.o. are pledged. The shares in Arcona Poland Project 5 Sp. z o.o. are not
pledged.
17
March 31, June 30, September 30 and December 31.
18
UniCredit has made a credit line of up to CZK 50,000,000 available for investments, including for investments in the office building
Politickych Veznu 10. Of this amount approximately CZK 14,636,000 has been used as at Statement of Financial Position’s date.
121
Slovenská Sporiteľňa
The secured bank loan Slovenská Sporiteľňa has been fully redeemed during January 2026 through the funds
Hypo Noe
The secured bank loan with Hypo Noe has been fully classified as current as at the Statement of Financial
Position date, as its contractual maturity was March 31, 2026.
Subsequent to the reporting period, the Fund successfully refinanced and extended this secured bank loan.
In March 2026, the Fund reached agreement with Hypo NOE on the refinancing of the facility, resulting in a
new loan maturity with a term of five years. As a result of this refinancing, the loan now has a long-term maturity
profile extending to March 2031.
This refinancing strengthens the Fund’s financing structure and provides long-term stability to the Group’s
debt profile.
Patria Bank
The secured bank loan with Patria Bank has been fully classified as a current liability as at the Statement of
Financial Position date due to a breach of the bank covenants at that date. The covenant breach mainly
resulted from the fact that the investment property EOS Business Park (Romania) became fully vacant during
the course of 2025, which temporarily affected the financial ratios required under the loan agreement.
Subsequent to the reporting period, the Fund has fully repaid and settled the Patria Bank loan facility. As a
result, the outstanding exposure under this financing has been eliminated and the related liability no longer
exists within the Group’s financing structure. The settlement of the loan improves the Group’s leverage position
and reduces the Fund’s overall bank financing exposure.
15.15.5
Statement of changes in lease liabilities
2025 |
2024 |
|
In € 1,000 |
In € 1,000 |
|
Balance as at 1 January |
- |
1,388 |
Remeasurement (as a result of an index / inflation) |
- |
186 |
Redemptions |
- |
-/- 87 |
Accrued interest |
- |
48 |
Exchange rate differences |
- |
10 |
Reclassifications (from “Liabilities directly associated with assets held for |
||
| sale”) |
1,493 |
- |
Reclassifications (to “Liabilities directly associated with assets held for |
||
| sale”) |
- |
-/- 1,545 |
Balance as at 31 December |
1,493 |
- |
The “Reclassification (from “Liabilities directly associated with assets held for sale”)” for the amount of
€ 1,493,000 relates to the properties Kardynala Wyszynskiego (Poland) and Legionow (Poland).
For further reference see section 15.20.4 “Statement of changes in liabilities directly associated with assets
held for sale”.
122
15.15.6
Analysis of lease liabilities
Nature of lease liability |
Related to property |
31-12-2025 |
31-12-2024 |
In € 1,000 |
In € 1,000 |
||
Lease liability by Arcona Capital Real Estate Trio Sp. z o.o. (Poland) |
|||
Land lease |
Grzymaly Siedleckiego |
N.a. |
Held for sale |
Land lease |
Kardynala Wyszynskiego |
314 |
Held for sale |
Land lease |
Legionow |
1,179 |
Held for sale |
1,493 |
- |
15.15.7
Maturity analysis contractual undiscounted cash flows of lease liabilities
31-12-2025 |
31-12-2024 |
|
In € 1,000 |
In € 1,000 |
|
Less than 1 year |
189 |
184 |
1 year to 5 years |
649 |
706 |
More than 5 years |
1,692 |
1,710 |
2,530 |
2,600 |
Statement of changes in other loans and borrowings
2025 |
2024 |
|
In € 1,000 |
In € 1,000 |
|
Balance as at 1 January |
2,014 |
3,959 |
Loans advanced |
800 |
2,000 |
Redemptions |
-/- 1,050 |
-/- 3,984 |
(Amortisation) flat fee and transaction costs |
- |
32 |
Accrued interest |
- |
9 |
Exchange rate differences |
-/- 6 |
-/- 2 |
Balance as at 31 December |
1,758 |
2,014 |
123
15.15.9
Analysis of other loans and borrowings
| 31-12-2025 |
||||||
Weighted |
||||||
Name of |
Secured / |
Date of |
average |
Face |
Carrying |
|
Name of company |
counterparty |
unsecured |
maturity |
interest rate |
value |
amount |
In % |
In € 1,000 |
In € 1,000 |
||||
Aisi Bela LLC |
Almaz-Press- |
Unsecured |
- |
0.00 |
41 |
41 |
Ukraine LLC |
||||||
| Arcona Property Fund |
Other third |
|||||
N.V. |
party (I) |
Unsecured |
15-01-2028 |
9.50 |
250 |
250 |
| Arcona Property Fund |
Other third |
|||||
N.V. |
party (II) |
Unsecured |
31-12-2026 |
8.70 |
967 |
967 |
| Arcona Property Fund |
Other third |
|||||
N.V. |
party (III) |
Unsecured |
18-12-2025 |
11.00 |
- |
- |
| Arcona Property Fund |
Other third |
|||||
N.V. |
party (IV) |
Unsecured |
18-12-2025 |
12.00 |
- |
- |
| Arcona Property Fund |
Other third |
|||||
N.V. |
party (V) |
Unsecured |
30-06-2026 |
8.50 |
500 |
500 |
1,758 |
1,758 |
|||||
| 31-12-2024 |
||||||
Weighted |
||||||
Name of |
Secured / |
Date of |
average |
Face |
Carrying |
|
Name of company |
counterparty |
unsecured |
maturity |
interest rate |
value |
amount |
In % |
In € 1,000 |
In € 1,000 |
||||
Aisi Bela LLC |
Almaz-Press- |
Unsecured |
- |
0.00 |
47 |
47 |
Ukraine LLC |
||||||
Arcona Property Fund |
Other third |
|||||
N.V. |
party (I) |
Unsecured |
15-01-2026 |
9.50 |
250 |
250 |
Arcona Property Fund |
Other third |
|||||
N.V. |
party (II) |
Unsecured |
30-06-2025 |
9.00 |
667 |
667 |
Arcona Property Fund |
Other third |
|||||
N.V. |
party (III) |
Unsecured |
18-12-2025 |
11.00 |
600 |
600 |
Arcona Property Fund |
Other third |
|||||
N.V. |
party (IV) |
Unsecured |
18-12-2025 |
12.00 |
450 |
450 |
2,014 |
2,014 |
|||||
15.15.10 Securities provided of other loans and borrowings
As at Statement of Financial Position’s date there were no securities provided with regard to the other loans
124
TRADE AND OTHER PAYABLES
15.16.1
Analysis of trade and other payables
31-12-2025 |
31-12-2024 |
|
In € 1,000 |
In € 1,000 |
|
Non-current part of trade and other payables |
72 |
- |
Current part of trade and other payables |
2,066 |
3,163 |
2,138 |
3,163 |
Specification of trade and other payables
31-12-2025 |
31-12-2024 |
|
In € 1,000 |
In € 1,000 |
|
Trade payables |
587 |
501 |
Accruals |
507 |
615 |
Fund management fee |
519 |
436 |
Interest payables |
182 |
219 |
Payable settlement acquisitions |
- |
1,187 |
Sales performance-related fee |
305 |
169 |
Sales fee |
- |
32 |
Other trade and other payables |
38 |
4 |
2,138 |
3,163 |
DEFERRED INCOME AND TENANT DEPOSITS
15.17.1
Analysis of deferred income and tenant deposits
31-12-2025 |
31-12-2024 |
|
In € 1,000 |
In € 1,000 |
|
Non-current part of deferred income and tenant deposits |
366 |
441 |
Current part of deferred income and tenant deposits |
73 |
100 |
439 |
541 |
15.17.2
Specification of deferred income and tenant deposits
31-12-2025 |
31-12-2024 |
|
In € 1,000 |
In € 1,000 |
|
Deposits received from tenants |
435 |
524 |
Advance payments received from tenants |
4 |
17 |
439 |
541 |
125
PROVISIONS
Since the 6-month period with regard to the sales performance-related fee as mentioned in section 15.34.5
“Sales fee and sales performance-related fee” has been expired, an amount of € 305,000 of the provision was
used during the financial period, since this amount has become due.
15.18.1
Statement of changes in provisions for sales performance-related fee
2025 |
2024 |
|
In € 1,000 |
In € 1,000 |
|
Balance as at 1 January |
- |
- |
Provisions made during the financial period |
305 |
169 |
Provisions used during the financial period |
-/- 305 |
-/- 169 |
Balance as at 31 December |
- |
- |
DEFERRED TAX LIABILITIES
For the specification and analysis of the (un)recognised deferred tax liabilities reference is made to sections:
•
15.6.1 “Specification of recognised deferred taxes”;
•
15.6.4 “Statement of changes in recognised deferred taxes”;
•
15.7.1 “Specification of unrecognised deferred taxes”; and
•
LIABILITIES DIRECTLY ASSOCIATED WITH ASSETS HELD FOR SALE
15.20.1
Analysis of liabilities directly associated with assets held for sale
31-12-2025 |
31-12-2024 |
|
In € 1,000 |
In € 1,000 |
|
Lease liabilities |
- |
1,519 |
15.20.2
Analysis of lease liabilities
Nature of lease liability |
Related to property |
31-12-2025 |
31-12-2024 |
In € 1,000 |
In € 1,000 |
||
Lease liability by Arcona Capital Real Estate Trio Sp. z o.o. (Poland) |
|||
Land lease |
Grzymaly Siedleckiego |
N.a. |
4 |
Land lease |
Kardynala Wyszynskiego |
Lease liability |
366 |
Land lease |
Legionow |
Lease liability |
1,149 |
- |
1,519 |
126
15.20.3
Statement of changes in liabilities directly associated with assets held for sale
2025 |
2024 |
|
In € 1,000 |
In € 1,000 |
|
Balance as at 1 January |
1,519 |
76 |
Remeasurement (as a result of an index / inflation) |
52 |
12 |
Redemptions |
-/- 192 |
-/- 177 |
Accrued interest |
95 |
50 |
Exchange rate differences |
19 |
13 |
Reclassifications (from “Lease liabilities”) |
- |
1,545 |
Reclassifications (to “Lease liabilities”) |
-/- 1,493 |
- |
Balance as at 31 December |
- |
1,519 |
The “Reclassification (to “Lease liabilities”)” for the amount of € 1,493,000 negative relates to the properties
Kardynala Wyszynskiego (Poland) and Legionow (Poland).
CONTINGENT ASSETS
A contingent asset is a possible asset that arises from past events and whose existence will be confirmed only
by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of
the Fund.
As of the Statement of Financial Position’s date, the Fund did not hold any contingent assets that are not
included in the Statement of Financial Position, except for unrecognised deferred tax assets, as mentioned in
In addition, the Fund is involved in legal proceedings relating to a potential unjust enrichment (tort) claim in
connection with the Bydgoszcz property. This claim arises from the alleged unlawful takeover of the Fund’s
operating business following the expiry of the land lease.
The outcome of this claim is subject to significant legal and procedural uncertainty and is dependent on future
court decisions and negotiations that are not wholly within the control of the Fund. Accordingly, no asset has
been recognised in the Statement of Financial Position.
Based on legal advice, this claim is considered to represent a possible asset and therefore qualifies as a
contingent asset. Given the inherent uncertainties surrounding the timing and likelihood of any economic
inflow, no further quantitative disclosure is provided.
15.22
NON-CONTINGENT ASSETS
As of the Statement of Financial Position’s date, the Fund did not hold any non-contingent assets other than
those already recognised in the Statement of Financial Position.
CONTINGENT LIABILITIES
A contingent liability is:
A.
a possible obligation that arises from past events and whose existence will be confirmed only by the
occurrence or non-occurrence of one or more uncertain future events not wholly within the control of
the Fund; or
127
B.
a present obligation that arises from past events but is not recognised because:
-
it is not probable that an outflow of resources embodying economic benefits will be required
to settle the obligation; or
-
the amount of the obligation cannot be measured with sufficient reliability.
As at Statement of Financial Position’s date the Fund has the following contingent liabilities which are not
included in the Statement of Financial Position:
A.
Arcona Capital RE Bohemia s.r.o. has a contingent liability for the amount of CZK 4,277,000
(€ 176,000) towards the buyer of the investment property Štefánikova with regard to rent received in
advance by Arcona Capital RE Bohemia s.r.o. for usage of the parking places (free of payment) by
the lessee of Štefánikova. Based on the agreement (2012) the buyer of Štefánikova will pay the taxes
with regard to this rent;
As a result of acquisitions through share-based payments the Fund has a contingent liability to issue
ordinary shares against an exercise price as mentioned below as a result of the outstanding warrants.
The conditions are as follows:
Number of | Date of | Expiration | Required | Exercise | |
Holder | warrants | Issue | date | share price | price |
SPDI | 76,085 | 29-03-2022 | 29-03-2027 | € 7.20 | € 0.00 |
SPDI | 39,458 | 15-06-2022 | 15-06-2027 | € 7.20 | € 0.00 |
The exercise date of the outstanding warrants is the trading day immediately following the 10
th
trading day on which the shares have traded on a regulated market (or system comparable to a
regulated market) and for which the volume-weighted average price of a share was € 7.20 or higher
(the “required share price”), provided that this warrant may not be exercised within a 12 months
period following the issue date, unless a prospectus approved by the AFM with respect to the
warrants and / or the warrant shares is published by the Fund.
In case the conditions are met the warrant shares will be issued against an exercise price of € 0.00.
The fair value of the warrants is nil. In case the conditions are met each warrant entitles the holder
to one ordinary share of the Fund and the warrant shares will be charged from the share premium
or other freely distributable reserve to the issued capital.
The statement of changes in warrants is as follows:
2025 |
2024 |
|
In pieces |
In pieces |
|
Balance as at 1 January |
115,543 |
259,807 |
Granted during the financial period |
- |
- |
Forfeited during the financial period |
- |
- |
Expired during the financial period |
- |
-/- 144,264 |
Balance as at 31 December |
115,543 |
115,543 |
Exercisable as at 31 December |
- |
- |
As at Statement of Financial Position’s date the Fund was not subject to any further contingent liabilities,
including any obligations that result from security transactions related to (exchange) rate risk in connection
128
NON-CONTINGENT LIABILITIES
As of the Statement of Financial Position’s date, the Fund was not subject to any contractual obligations, such
as investments, repairs, maintenance, or other non-contingent liabilities, that require settlement in a future
GROSS RENTAL INCOME
15.25.1 General
The Fund leases out its investment property. The Fund has classified these leases as operating leases
because the Fund does not transfer substantially all of the risks and rewards incidental to the ownership of the
assets. All gross rental income can be classified as operating lease income, with the exception of amortisation
of lease incentives.
During the financial period, as well as during the previous financial period no contingent rental income was
accounted for as income in the Income Statement. Leases for a determined time are normally indexed yearly
with annual inflation stated by the relevant national Central Banks. New leases for a determined time are
usually signed for a term of five years. All these lease contracts usually include at least a three-month deposit.
15.25.2
Analysis of gross rental income
2025 |
2024 |
|
In € 1,000 |
In € 1,000 |
|
Gross rental income collected / accrued |
5,334 |
6,542 |
Amortisation of lease incentives |
-/- 274 |
-/- 208 |
5,060 |
6,334 |
15.25.3
Analysis of gross rental income collected / accrued
2025 |
2024 |
|
In € 1,000 |
In € 1,000 |
|
Fixed lease payments received |
5,060 |
6,542 |
Variable lease payments received |
- |
- |
5,060 |
6,542 |
15.25.4
Weighted average percentage of the vacant space
Weighted to the fair value, the weighted average percentage of the vacant space as at Statement of Financial
Position’s date is as follows:
31-12-2025 |
31-12-2024 |
|
In % |
In % |
|
Buildings (including underground) |
11.6 |
15.2 |
Land plots |
N.a. |
N.a. |
Investment property under development |
N.a. |
100.0 |
Buildings (including underground) held for sale |
100.0 |
10.8 |
Investment property under development held for sale |
100.0 |
N.a. |
129
Weighted to the fair value, the weighted average percentage of the vacant space during the financial period is
as follows:
2025 |
2024 |
|
In % |
In % |
|
Buildings (including underground) |
7.9 |
13.9 |
Land plots |
N.a. |
N.a. |
Investment property under development |
100.0 |
100.0 |
Buildings (including underground) held for sale |
100.0 |
22.3 |
Investment property under development held for sale |
100.0 |
N.a. |
15.25.5
Non-cancellable lease revenues
The gross rental income receivable on account of non-cancellable leases related to owned investment
property, investment property under development and inventories as at Statement of Financial Position’s date
is as follows (The future minimum gross rental income receivable in foreign currency has been translated at
the average exchange rate used for the Consolidated Income Statement for the financial period):
31-12-2025 |
31-12-2024 |
|
In € 1,000 |
In € 1,000 |
|
Less than 1 year |
3,380 |
4,295 |
1 year to 2 years |
2,814 |
3,079 |
2 years to 3 years |
2,137 |
2,587 |
3 years to 4 years |
1,199 |
1,988 |
4 years to 5 years |
763 |
900 |
More than 5 years |
3,820 |
3,262 |
14,113 |
16,111 |
REBILLED AND NON-REBILLED SERVICE CHARGES AND PROPERTY OPERATING
EXPENSES
15.26.1 General
As the Fund invoices service charges independently (or as principal) to the lessees on the basis of the leases
entered into, such reimbursed service charges are shown separately in the Consolidated Income Statement.
The work associated with the service charges is carried out either by the Fund, or by third parties on a contract
basis. Contracts for the performance of service work are usually entered into for a maximum period of six
months. In addition, service charge expenses also include charges related to vacant units and / or other
irrecoverable service charges due to contractual limits or insolvent tenants.
130
15.26.2
Analysis of property operating expenses
2025 |
2024 |
|
In € 1,000 |
In € 1,000 |
|
Property management |
373 |
456 |
Asset management |
371 |
479 |
Maintenance expenses in respect of properties |
534 |
431 |
Property taxes and fees |
361 |
385 |
Insurance premiums |
51 |
55 |
Other property operating expenses |
1 |
1 |
1,691 |
1,807 |
15.26.3
Allocation of service charges and property operating expenses
The determination of costs from non-rented properties is based on properties that had an average vacancy of
more than 10% during the financial period. The allocation of service charges and direct operating expenses to
the properties, whether or not rent generating, is as follows:
2025 |
2024 |
|
In € 1,000 |
In € 1,000 |
|
For properties let |
3,676 |
3,966 |
For properties not let |
440 |
451 |
4,116 |
4,417 |
VALUATION RESULTS OF PROPERTIES
2025 |
2024 |
|
In € 1,000 |
In € 1,000 |
|
Owned investment property |
29 |
-/- 1,797 |
Right-of-use assets |
- |
-/- 38 |
Investment property under development |
-/- 11 |
366 |
Owned investment property held for sale |
-/- 5,244 |
996 |
Right-of-use assets held for sale |
-/- 97 |
-/- 127 |
Investment property under development held for sale |
-/- 70 |
- |
-/- 5,393 |
-/- 600 |
131
15.28
RESULT ON DISPOSALS OF PROPERTIES
15.28.1
Analysis of result on disposals of properties
2025 |
2024 |
|
In € 1,000 |
In € 1,000 |
|
Owned investment property held for sale |
-/- 22 |
-/- 1,006 |
15.28.2
Specification of result on disposals of properties - per building
2025 |
2024 |
|
In € 1,000 |
In € 1,000 |
|
Palmovka (Czechia) |
838 |
- |
Letná (Slovakia) |
-/- 174 |
- |
Grzymaly Siedleckiego (Poland) |
-/- 686 |
- |
Záhradnícka (Slovakia) |
- |
-/- 1,691 |
Karlin (Czechia) |
- |
685 |
-/- 22 |
-/- 1,006 |
Specification of result on disposals of properties
2025 |
2024 |
|
In € 1,000 |
In € 1,000 |
|
Realised value adjustments |
922 |
-/- 703 |
Sales fee |
84 |
204 |
Sales performance-related fee |
305 |
85 |
Transaction costs on sale of properties |
542 |
6 |
Consultancy fees and legal fees |
13 |
8 |
Subtotal costs on sale of properties |
944 |
303 |
-/- 22 |
-/- 1,006 |
RESULT ON DISPOSALS OF INVENTORIES
15.29.1
Analysis of result on disposals of inventories
2025 |
2024 |
|
In € 1,000 |
In € 1,000 |
|
Apartment 1-D, Gardova Glava, Sofia (Bulgaria) |
N.a. |
198 |
Apartment 3-C, Gardova Glava, Sofia (Bulgaria) |
N.a. |
188 |
Apartment 7-D, Gardova Glava, Sofia (Bulgaria) |
N.a. |
144 |
Apartment 8-E, Gardova Glava, Sofia (Bulgaria) |
N.a. |
109 |
Parking places, Gardova Glava, Sofia (Bulgaria) |
N.a. |
140 |
N.a. |
779 |
132
Specification of result on disposals of inventories
2025 |
2024 |
|
In € 1,000 |
In € 1,000 |
|
Selling price |
N.a. |
1,848 |
Less: carrying amount of sold inventories |
N.a. |
938 |
N.a. |
910 |
|
Sales fee |
N.a. |
37 |
Sales performance-related fee |
N.a. |
84 |
Adjustment refund of value added tax |
N.a. |
10 |
Subtotal costs on sale of inventories |
N.a. |
131 |
N.a. |
779 |
15.30
NET RESULTS ON PROPERTIES
2025 |
2024 |
|
In € 1,000 |
In € 1,000 |
|
Valuation gains |
1,760 |
2,636 |
Valuation losses |
-/- 6,231 |
-/- 3,029 |
-/- 4,471 |
-/- 393 |
|
Costs on sale of properties |
944 |
434 |
-/- 5,415 |
-/- 827 |
SHARE IN RESULTS OF INVESTMENTS IN ASSOCIATES
15.31.1
Analysis of share in results of investments in associates
2025 |
2024 |
|
In € 1,000 |
In € 1,000 |
|
Lelar Holdings Limited |
266 |
80 |
15.31.2
Specification of share in results of investments in associates
2025 |
2024 |
|
In € 1,000 |
In € 1,000 |
|
Fair value adjustments |
143 |
-/- 287 |
Dividend |
123 |
367 |
266 |
80 |
133
FINANCIAL INCOME
2025 |
2024 |
|
In € 1,000 |
In € 1,000 |
|
Realised currency results on net investments in group companies |
259 |
638 |
Interest income on derivative financial instruments |
87 |
200 |
Interest income of bank balances and deposits |
17 |
14 |
Interest on trade receivables |
7 |
4 |
Penalty interest and fees |
2 |
9 |
372 |
865 |
OTHER OPERATING INCOME
2025 |
2024 |
|
In € 1,000 |
In € 1,000 |
|
Penalties for early termination of rental contracts |
195 |
5 |
Reimbursement from tenants |
70 |
- |
Compensation for non-contractual use of the premises |
9 |
- |
Other operating income |
7 |
12 |
281 |
17 |
ADMINISTRATIVE EXPENSES
15.34.1
Specification administrative expenses
2025 |
2024 |
|
In € 1,000 |
In € 1,000 |
|
Fund management fee |
678 |
675 |
Performance-related remuneration |
- |
- |
678 |
675 |
15.34.2 Management fee
This is the total fee received by the Managing Board (Arcona Capital Fund Management B.V.) for the
management it performs. The total management fee consists of the Fund management fee as well as the
Asset management fee. The management fee is calculated by percentages on the value of the Fund’s total
assets at month-end. In accordance with the Fund’s prospectus, the Registration Document dated October 19,
2016, Security Note dated October 28, 2016 and the addendum of the Registration Document dated December
20, 2023 these percentages are:
•
for assets below € 75 million: 1.50% per annum (0.125% per month);
•
for assets as of € 75 million and above: 1.00% per annum (0.083% per month).
134
15.34.3
Specification Fund management fee
2025 |
2024 |
|
In € 1,000 |
In € 1,000 |
|
Management fee |
1,059 |
1,180 |
Less: Asset management fee: |
||
Arcona Capital Czech Republic s.r.o. |
172 |
233 |
Arcona Capital Poland Sp. z o.o. |
195 |
199 |
Arcona Capital Bulgaria E.O.O.D. |
4 |
8 |
CEG South East Continent Unique Real Estate Management Limited |
10 |
65 |
381 19 |
505 |
|
Fund management fee (Arcona Capital Fund Management B.V.) |
678 |
675 |
15.34.4 Performance-related remuneration
Until December 20, 2023 the Managing Board was entitled to performance-related remuneration dependent
on the Fund’s total annual return. The total return is defined as the increase in Net Asset Value per profit-
sharing share over the relevant financial period increased by dividends distributed during that financial period.
The sum of these components is expressed as a percentage of the Net Asset Value per profit-sharing share
at the start of the financial period. The total performance-related remuneration is calculated on the total
average number of outstanding profit-sharing shares in the relevant financial period multiplied by the Net Asset
Value per profit-sharing share at the start of the relevant financial period.
In accordance with the Fund’s prospectus, the Registration Document dated October 19, 2016, Security Note
dated October 28, 2016 and the First Amendment (Addendum May 24, 2018) the performance-related
remuneration consists of three tiers:
1.
in the case of a total return of up to 12% the performance-related remuneration is 0%;
2.
in the case of a total return of 12% to 15% the performance-related remuneration is 20% of the total
return less 12%;
3.
in the case of a total return of more than 15% the performance-related remuneration is 30% of the
total return less 15%. In addition, the remuneration indicated under 2 will be awarded.
The performance-related remuneration will be charged annually in arrears and is budgeted and put aside on
a three-monthly basis. This performance-related remuneration will not be due if the stock exchange price of
the share plus the dividends distributed in the relevant financial period is lower than that of any preceding
period for which the performance-related remuneration was deducted.
50% of the performance-related remuneration is payable in shares of the Fund, such shares to be issued at
Net Asset Value as at year-end rather than the prevailing stock exchange price (unless the stock market price
is above the Net Asset Value per share). The share component of the performance-related remuneration due
for a financial period is payable after publication of the Annual Report after the end of the relevant financial
period, the cash components are payable in three equal amounts on 30
April, 31
July and 31
October following
the end of the relevant financial period.
As of June 21, 2025, the original agreement (Registration Document dated October 19, 2016 and the Securities
Note dated October 28, 2016) and the First Amendment (Addendum May 24, 2018) became into force again.
For the financial period, the Managing Board is not entitled to performance-related remuneration (2024: nil).
19
135
15.34.5
Sales fee and sales performance-related fee
In accordance with the addendum of the Registration Document dated December 20, 2023 the Managing
Board is entitled to a sales fee and sales performance-related fee, which replaces the performance-related
remuneration is described in section 15.34.4 “Performance-related remuneration”.
The sales fee consists of two tiers:
1.
in the case the sale of an asset is realised within the 12-month period the sales fee is 2.0% of the
gross sales price agreed;
2.
in the case the sale of an asset is realised within the 13-to-18-month period the sales fee is 1.5% of
the gross sales price agreed.
The sales performance-related fee consists of two tiers:
1.
in the case the sale of an asset is realised within the 12-month period the sales performance-related
fee is 20.0%% of the excess gross sales price over valuation;
2.
in the case the sale of an asset is realised within the 13-to-18-month period the sales performance-
related fee is 15.0% of the excess gross sales price over valuation.
Starting points for the calculation of the Incentive for the Managing Board:
1.
gross sales price is the sales price before costs;
2.
valuation: the assessed value in local currency as reported as at June 30, 2023;
3.
a sale is realised on the date of the contractual signing of the sales agreement;
4.
the 12-months period runs from December 21, 2023 up to and including December 20, 2024;
5.
the 13 to 18-months period runs from December 21, 2024 up to and including June 20, 2025;
6.
the sales fee is payable upon receipt of the sale proceeds (sales closed);
7.
the 20.0% sales performance-related fee is payable as of December 21, 2024 for sales closed prior
to this date or (if closed on or later than December 21, 2024) at the moment of closing;
8.
the 15.0% sales performance-related fee is payable as of June 21, 2025 for sales closed prior to this
date or (if closed on or later than June 21, 2025) at the moment of closing;
9.
the sales performance-related fee is calculated separately for each period on the entire positive or
negative deviation compared to the assessed value as at June 30, 2024 during the 12- and 6-months
period.
As of June 21, 2025, the original agreement (Registration Document dated October 19, 2016 and the Securities
Note dated October 28, 2016) and the First Amendment (Addendum May 24, 2018) became into force again.
15.34.6
Specification sales fee and sales performance-related fee
2025 | 2024 | |
In € 1,000 | In € 1,000 | |
Sales fee | 84 20 | 241 |
Sales performance-related fee | 305 21 | 169 |
389 | 410 |
20
Reference is made to section 15.28.3 “Specification of result on disposal of properties” and 15.29.2 “Specification of result on disposals
of inventories”.
136
OTHER OPERATING EXPENSES
15.35.1
Specification of other operating expenses
2025 |
2024 |
|
In € 1,000 |
In € 1,000 |
|
Costs of service providers |
1,049 |
1,049 |
Other operating expenses |
186 |
65 |
1,235 |
1,114 |
|
Costs of funding and acquisitions |
17 |
182 |
1,252 |
1,296 |
Analysis of costs of service providers
2025 |
2024 |
|
In € 1,000 |
In € 1,000 |
|
Audit fees |
292 |
252 |
Accounting expenses |
288 |
278 |
Consultancy fees |
177 |
128 |
Court fees |
26 |
68 |
Custody fees |
55 |
57 |
Appraisal expenses |
34 |
39 |
Supervisors’ expenses |
29 |
22 |
Steering Committee fees |
25 |
47 |
Supervisory Board fees |
23 |
28 |
Insurance AIFMD |
22 |
22 |
Bank costs |
19 |
21 |
Listing, Paying and Fund Agent fees |
14 |
12 |
Asset management |
10 |
26 |
Marketing expenses |
11 |
7 |
Other costs of service providers |
24 |
42 |
1,049 |
1,049 |
For the items listed above the following explanation can be given:
•
the “Accounting expenses” include the expenses in respect of bookkeeping, consolidation activities
on a quarterly basis for results announcements and the determination of corresponding Net Asset
Value (
NAV
), preparation of (semi)-annual report and other activities to fulfil administrative
requirements for the Fund and its subsidiaries;
•
the “Audit fees” include the fees for the audit of the Consolidated Financial Statements and Parent
Company Financial Statements, as well as audits of accounts of subsidiaries. The fees for the audit
of the Consolidated Financial Statements, Parent Company Financial Statements and European
Single Electronic Format (
ESEF
) reporting 2025 (Deloitte Netherlands) are estimated at € 132,000
(2024: € 88,000). During the financial period audit fees related to prior years have been booked in
an amount of € nil (2024: € 1,000 negative). The audit fees of accounts of subsidiaries (Deloitte other
countries) amount to € 160,000 (2024: € 165,000).
Except for:
o
audit of the Consolidated Financial Statements and Parent Company Financial Statements,
o
audits of accounts of subsidiaries, and
o
audit of ESEF reporting and requirements
no services of Deloitte have been used.
137
•
the “Court fees” relates mainly to court fees and corresponding legal fees related to a (potential)
claim against Spóldzielnia “Budowlani (the Cooperative) concerning the leased Bydgoszcz property.
•
the “Consultancy fees” include several consultancy fees and legal fees;
•
the “Custody fees” include the fees for operational activities by the AIFMD Depositary;
•
the “Asset management” relate to asset management fee Delenco (associates);
•
the “Supervisors’ expenses” include expenses for supervision by the AFM and DNB;
•
the “Other costs of service providers” include, among others, costs of press releases, required
15.35.3
Analysis of Supervisory Board fees
2025 |
2024 |
|
In € 1,000 |
In € 1,000 |
|
Mrs. A.N. Krol |
14 |
14 |
Mr. M.P. Beys 21 |
7 |
14 |
Mr. E. van Erkelens 22 |
1 |
N.a. |
Mr. E. Korteweg 23 |
1 |
N.a. |
Mr. J.J. van Heijst MSc 1 9 F 23 |
- |
- |
23 |
28 |
The Fund has provided no loans, advances, or guarantees for the members of the Supervisory Board. The
members of the Supervisory Board receive no options or remuneration in the form of the Fund’s shares.
15.35.4
Analysis of other operating expenses
2025 |
2024 |
|
In € 1,000 |
In € 1,000 |
|
Change in expected credit losses termination interest rate swaps |
- |
-/- 75 |
Irrecoverable trade receivables |
- |
107 |
Change in expected credit losses for trade receivables |
-/- 11 |
-/- 84 |
Non-refundable value added tax ( VAT ) |
176 |
105 |
Wages and salaries statutory directors |
21 |
12 |
186 |
65 |
15.35.5
Analysis of costs of funding and acquisitions
2025 |
2024 |
|
In € 1,000 |
In € 1,000 |
|
Consultancy fees / legal fees |
17 |
182 |
The costs of funding and acquisitions include costs of technical, legal and tax due diligence for (potential)
acquisitions.
21
At the General Meeting of Shareholders as of June 25, 2025, the shareholders rejected the proposal of the Priority to re-appoint Mr.
M.P. Beys.
22
At the Extraordinary General Meeting of Shareholders as of December 4, 2025, the shareholders agreed the proposal of the Priority to
appoint Mr. E. van Erkelens and Mr. E.J.C.G. Korteweg as a member of the Supervisory Board for a period of 4 years.
23
Mr. J.J. van Heijst M.Sc. has waived his Supervisory Board fee and withdrawn his candidacy for re-appointment as of June 25, 2025.
138
15.35.6 Transaction costs
In accordance with the EU-IFRS accounting principles the Fund includes the transaction costs incurred on
purchase of properties, inventories and other equity investments in the purchase price of investments and
recognises the transaction costs incurred on sale of properties, inventories and other equity investments under
result on disposals of investments.
Based on article 123:1.c of the Decree on Conduct of Business Supervision of Financial Undertakings under
the Act of Financial Supervision (in Dutch: Besluit Gedragstoezicht Financiële ondernemingen Wft) the
analysis of identifiable and quantifiable transaction costs on purchase and sale of investments during the
financial period is disclosed. The analysis is as follows:
2025 |
2024 |
|
In € 1,000 |
In € 1,000 |
|
Transaction costs on purchase of investments |
- |
- |
Transaction costs on sale of investments |
944 |
434 |
944 |
434 |
15.35.7
Costs of lending financial instruments
During the financial period, no financial instruments were borrowed or lent by either the Fund or its related
parties (so-called securities lending). No expenses were therefore incurred, or fees requested.
15.35.8
Remuneration for orders on behalf of the Fund
Neither the Managing Board, the directors of the Managing Board, the Fund, the Depositary of the Fund, nor
parties affiliated with these parties, received any remuneration for performing assignments for the Fund, other
than as described in section 15.34 “Administrative expenses” and 15.35 “Other operating expenses”. The
management fee is paid to the Fund Manager by the Fund. This fee also contains the remuneration of the
Managing Board. However, this is not possible to quantify to the Fund.
15.35.9 Outsourcing expenses
The Managing Board of the Fund has in the ordinary course of business outsourced the accounting activities
of the Fund to Moore MKW Accountants B.V.
The related expenses are included in the section accounting expenses, as indicated in section 15.35.2
“Analysis of costs of service providers”.
15.35.10 Comparison of actual costs with prospectus
2025 |
2024 |
|||
Actual |
Prospectus |
Actual |
Prospectus |
|
In € 1,000 |
In € 1,000 |
In € 1,000 |
In € 1,000 |
|
Costs of service providers |
1,049 |
900 |
1,049 |
900 |
For comparison of actual costs of service providers with budgeted costs of service providers as per the Fund’s
prospectus, the Registration Document dated October 19, 2016 in conjunction with the Security Note dated
October 28, 2016 has been used.
For the analysis of costs of service providers reference is made to section 15.35.2 “Analysis of costs of service
139
PERSONNEL COSTS
The Fund does not employ any personnel, with the exception of statutory directors of the Fund’s subsidiaries.
The statutory directors receive a wage, which is specified in “Other operating expenses” (reference is made to
FINANCIAL EXPENSES
2025 |
2024 |
|
In € 1,000 |
In € 1,000 |
|
Interest expense on secured bank loans |
1,160 |
1,752 |
Interest expense on other loans and borrowings |
181 |
425 |
Change in fair value of derivative financial instruments |
101 |
173 |
Interest expense on lease liabilities |
95 |
99 |
Foreign exchange and currency losses |
65 |
62 |
Withholding tax on loans due to shareholders and other group companies |
53 |
40 |
Variable compensation on other loans and borrowings |
- |
29 |
Interest expense and costs of Tax Authorities |
9 |
- |
Other financial expenses |
17 |
16 |
1,681 |
2,596 |
ONGOING CHARGES FIGURE
24
Based on article 123:1.l of the Decree on Conduct of Business Supervision of Financial Undertakings under
the Act of Financial Supervision (in Dutch: “Besluit Gedragstoezicht Financiële ondernemingen Wft”) the
Ongoing Charges Figure (
OCF
) is disclosed. The OCF is calculated by dividing the total expenses (including
operating expenses) during the financial year by the average Group equity of the Fund during the financial
year. The total expenses include the expenses charged to the profit for the period as well as to Group equity.
They also include the operating expenses of the properties. No net service charges are included in the total
expenses, since these are entirely covered by the service income from service fees and the fees part of the
gross rental income. The expenses which are related to the issuance and the redemption of own ordinary
shares, as far as these are covered by surcharges and reductions received, are not taken into consideration.
Regular interest charges for loans contracted, as well as costs of investment transactions, are also not included
in the calculation of the OCF.
The average Group equity is determined by the average of all calculated and published Triple Net Asset Values
(
NNNAV
’s).
24
The Ongoing Charges Figure should be considered as an “Alternative Performance Measure” (APM).
140
15.38.1
Calculation of OCF
Notes | 2025 | 2024 | 2023 | 2022 | 2021 | |
In € 1,000 | In € 1,000 | In € 1,000 | In € 1,000 | In € 1,000 | ||
Property operating expenses | 15.26 | 1,691 | 1,807 | 1,834 | 1,936 | 2,380 |
Administrative expenses | 15.34 | 678 | 675 | 675 | 705 | 648 |
Other operating expenses | 15.35 | 1,252 | 1,296 | 1,219 | 1,348 | 1,281 |
Total costs for calculation OCF | 3,621 | 3,778 | 3,728 | 3,989 | 4,309 | |
Average shareholders’ equity | 15.38.2 | 41,159 | 44,314 | 48,567 | 49,730 | 45,337 |
OCF | 8.80 | 8.53 | 7.66 | 8.02 | 9.50 |
In 2025 the OCF increased as a result of an decrease of the total expenses (including “Other operating
expenses”) by approximately 4%, in conjunction with the decrease of the average Group equity by
approximately 7%.
15.38.2
Calculation of weighted average Group equity for calculation of OCF
Notes | 2025 | 2024 | 2023 | 2022 | 2021 | |
In € 1,000 | In € 1,000 | In € 1,000 | In € 1,000 | In € 1,000 | ||
NNNAV as at 31 December | ||||||
| previous year (in €) | 10.65 | 10.93 | 11.81 | 12.76 | 11.84 | |
NNNAV as at 31 March (in €) | 10.76 | 10.91 | 11.88 | 11.88 | 11.87 | |
NNNAV as at 30 June (in €) | 10.79 | 10.93 | 11.77 | 12.00 | 11.91 | |
NNNAV as at 30 September (in €) | 10.29 | 11.16 | 11.72 | 12.37 | 11.93 | |
NNNAV as at 31 December (in €) | 7.1.8 | 9.66 | 10.65 | 10.93 | 11.81 | 12.76 |
Basic number of profit-sharing | ||||||
shares | ||||||
31 December previous year | 3,882,965 | 4,177,083 | 4,185,984 | 3,758,683 | 3,758,683 | |
31 March | 3,962,436 | 4,177,183 | 4,177,083 | 4,074,351 | 3,758,683 | |
30 June | 3,962,436 | 4,177,083 | 4,177,083 | 4,238,059 | 3,758,683 | |
30 September | 3,962,436 | 3,882,965 | 4,177,083 | 4,203,124 | 3,758,683 | |
31 December | 19.9.1 | 3,962,436 | 3,882,965 | 4,177,083 | 4,185,984 | 3,758,683 |
Shareholders’ equity | ||||||
31 December previous year | 41,354 | 45,656 | 49,436 | 47,961 | 44,503 | |
31 March | 42,636 | 45,572 | 49,624 | 48,403 | 44,616 | |
30 June | 42,755 | 45,656 | 49,164 | 50,857 | 44,766 | |
30 September | 40,773 | 43,334 | 48,955 | 51,993 | 44,841 | |
31 December | 38,277 | 41,354 | 45,656 | 49,436 | 47,961 | |
Cumulative shareholders’ equity | 205,795 | 221,572 | 242,835 | 248,650 | 226,687 | |
Number of observations | 5 | 5 | 5 | 5 | 5 | |
Weighted average group’ equity | 41,159 | 44,314 | 48,567 | 49,730 | 45,337 |
15.38.3
Calculation of OCF (without non-regular costs)
25
Notes | 2025 | 2024 | 2023 | 2022 | 2021 | |
In € 1,000 | In € 1,000 | In € 1,000 | In € 1,000 | In € 1,000 | ||
Total costs for calculation OCF | 15.38.1 | 3,621 | 3,778 | 3,728 | 3,989 | 4,309 |
Less: | ||||||
Costs of funding and acquisitions | 15.35.5 | 17 | 182 | 11 | 207 | 86 |
Steering Committee fees | 15.35.2 | 25 | 47 | - | - | - |
Court fees | 15.35.2 | 26 | - | - | - | - |
Total costs for calculation OCF | ||||||
| (without non-regular costs) | 3,553 | 3,549 | 3,517 | 3,782 | 4,223 | |
Average shareholders’ equity | 15.38.2 | 41,159 | 44,314 | 48,567 | 49,730 | 45,337 |
OCF (without non-regular costs) | 8.63 | 8.01 | 7.63 | 7.61 | 9.31 |
25
The OCF (without non-regular costs) should be considered as an “Alternative Performance Measure” (APM).
INCOME TAX EXPENSE
15.39.1 Tax position
The taxable profits of the Fund are subject to corporate income tax (
CIT
).
15.39.2
Income tax expense recognised in the Consolidated Income Statement
2025 | 2024 | |
In € 1,000 | In € 1,000 | |
Current income tax expense | ||
Current year | 1,739 | 723 |
Adjustments related to prior years | - | 6 |
Subtotal current income tax expense | 1,739 | 729 |
Deferred income tax expense | ||
Origination and reversal of taxable temporary differences | -/- 2,692 | -/- 758 |
Recognition of previously unrecognised (derecognition of previously | ||
| recognised) tax losses carried forward | -/- 43 | 20 |
Recognition of previously unrecognised (derecognition of previously | ||
| recognised) other taxable temporary differences | 258 | 43 |
Change in tax rate | 242 | -/- 3 |
Adjustments related to prior years | 8 | -/- 19 |
Subtotal deferred income tax expense | -/- 2,227 | -/- 717 |
Total income tax expense | -/- 488 | 12 |
15.39.3
Reconciliation of effective tax rate
2025 | 2025 | 2024 | 2024 | |
In % | In € 1,000 | In % | In € 1,000 | |
Profit before income tax | -/- 4,833 | -/- 20 | ||
Tax using the Parent Company’s domestic tax rate | -/- 25.8 | -/- 1,246 | -/- 25.8 | -/- 5 |
Effect of tax rates in foreign jurisdictions | 6.0 | 288 | 915.0 | 183 |
Change in tax rate | 5.0 | 242 | -/- 15.0 | -/- 3 |
Tax effect of: | ||||
Non-deductible expenses | 0.5 | 23 | 490.0 | 98 |
Tax exempt revenues | -/- 3.7 | -/- 178 | -/- 1,934.2 | -/- 387 |
Tax on phantom results | -/- 0.2 | -/- 8 | -/- 95.0 | -/- 19 |
Current year losses for which no deferred tax asset | ||||
| is recognised | 3.5 | 168 | 475.0 | 95 |
Recognition of previously unrecognised | ||||
| (derecognition of previously recognised) tax losses | -/- 0.9 | -/- 43 | 100.0 | 20 |
Recognition of previously unrecognised | ||||
(derecognition of previously recognised) other | 5.3 | 258 | 215.0 | 43 |
taxable temporary differences | ||||
Adjustments related to prior years | 0.2 | 8 | -/- 65.0 | -/- 13 |
-/- 10.1 | -/- 488 | 60.0 | 12 |
15.39.4
Deferred income tax recognised directly in Group equity
2025 | 2024 | |
In € 1,000 | In € 1,000 | |
Related to receivables from shareholders and other group companies | -/- 1 | -/- 28 |
15.39.5
Applicable local corporate income tax rates
2026 | 2025 | 2024 | 2023 | 2022 | ||
In % | In % | In % | In % | In % | ||
The Netherlands: | ||||||
- first bracket | 19.00 | 19.00 | 19.00 | 19.00 | 19.00 | |
- second bracket as of € 200,000 | 25.80 | 25.80 | 25.80 | 25.80 | 25.80 | |
Czechia | 21.00 | 21.00 | 21.00 | 19.00 | 19.00 | |
Poland: | ||||||
- regular | 19.00 | 19.00 | 19.00 | 19.00 | 19.00 | |
2 0 F | ||||||
- small taxpayers 26 | 9.00 | 9.00 | 9.00 | 9.00 | 9.00 | |
Romania: | ||||||
- regular | 16.00 | 16.00 | 16.00 | 16.00 | 16.00 | |
2 1 F | ||||||
- micro-companies 27 with at least 1 employee | 1.00 | 1.00 | 1.00 | 1.00 | 1.00 | |
Slovakia: | ||||||
- taxable income (revenues) up to € 100,000 | 10.00 | 10.00 | N.a. | N.a. | N.a. | |
- taxable income (revenues) up to € 5,000,000 | 21.00 | 21.00 | N.a. | N.a. | N.a. | |
- taxable income (revenues) exceeding € 5,000,000 | 24.00 | 24.00 | N.a. | N.a. | N.a. | |
- regular | N.a. | N.a. | 21.00 | 21.00 | 21.00 | |
2 2 F | ||||||
- micro-taxpayers 28 | N.a. | N.a. | 15.00 | 15.00 | 15.00 | |
Ukraine | 18.00 | 18.00 | 18.00 | 18.00 | 18.00 |
26
As of January 1, 2019, a reduced corporate income tax rate was introduced in Poland for so-called “small taxpayers”. Small taxpayers
are, for example, entities whose revenues, including value added tax (
VAT
), in a given tax year did not exceed in the preceding tax year
the PLN equivalent of € 2,000,000. The reduced corporate income tax rate will not be available for entities created or involved in certain
restructuring activities.
27
Micro-companies in Romania are corporate taxpayers and entrepreneurs and self-employed individuals that achieve turnover up to
€ 100,000 (year 2025: up to € 250,0000, year 2024 and 2023: up to € 500,000 and until January 1, 2023: up to € 1,000,000). The reduced
tax rate of 1.00% on revenue is solely applicable if the company has at least one employee with full-time employment contract for an
indefinite period.
28
As of January 1, 2021, a reduced corporate income tax rate was introduced in Slovakia for so-called “micro-taxpayers”. Micro-taxpayers
are corporate taxpayers and entrepreneurs and self-employed individuals that achieve taxable income (revenues) up to € 60,000 for the
144
EARNINGS PER SHARE
2
3
F
29
Calculation of basic earnings per share
The basic earnings per share are calculated by dividing the profit for the period attributable to holders of shares
by the weighted average number of profit-sharing shares outstanding during the financial period.
The weighted average number of profit-sharing shares is adjusted for events, other than the conversion of
potential ordinary shares, which have changed the number of profit-sharing shares outstanding without a
corresponding change in resources.
If the number of profit-sharing shares outstanding increases as a result of a capitalisation, bonus issue or share
split, or decreases as a result of a reverse share split, the calculation of basic and diluted earnings per share
15.40.2
Profit for the period attributable to shareholders (basic)
2025 |
2024 |
|
In € 1,000 |
In € 1,000 |
|
Profit for the financial period |
-/- 4,345 |
-/- 32 |
15.40.3
Weighted average number of profit-sharing shares outstanding (basic)
2025 |
2024 |
|
In pieces |
In pieces |
|
Profit-sharing shares outstanding as at 1 January |
3,882,965 |
4,177,083 |
Effect is issued profit-sharing shares during the financial period |
70,888 |
- |
Effect of share buy-back / Reverse Bookbuilding during the financial |
- |
-/- 61,074 |
| period |
||
3,953,853 |
4,116,009 |
15.40.4
Calculation of diluted earnings per share
The diluted earnings per share are calculated by dividing the profit for the period attributable to holders of
shares, adjusted for costs relating to the convertible securities included in the profit for the period, by the
weighted average number of profit-sharing shares during the financial period, adjusted for the maximum
number of profit-sharing shares that could be converted during the financial period.
The adjustments as described are only made in case conversion will cause dilution of earnings. In case
conversion will have a positive effect on the earnings per share, these adjustments are not made.
15.40.5
Profit for the period attributable to shareholders (diluted)
2025 |
2024 |
|
In € 1,000 |
In € 1,000 |
|
Profit for the period |
-/- 4,345 |
-/- 32 |
Interest expense on convertible bonds (net of tax) |
- |
- |
-/- 4,345 |
-/- 32 |
29
The calculation of the earnings per share includes all types of profit-sharing shares (e.g. ordinary and registered shares). Therefore,
treasury shares are excluded from the earnings per share.
145
15.40.6
Weighted average number of profit-sharing shares outstanding (diluted)
2025 |
2024 |
|
In pieces |
In pieces |
|
| Weighted average number of profit-sharing shares outstanding during |
3,953,853 |
4,116,009 |
the financial period (basic) |
||
Effect of conversion of warrants |
- |
- |
Effect of conversion of convertible bonds |
- |
- |
3,953,853 |
4,116,009 |
146
RISK MANAGEMENT
15.41.1 General
According to its investment policy set out in the prospectus, the Registration Document dated
October 19, 2016 in conjunction with the Security Note dated October 28, 2016, as well as the addendum of
the Registration Document dated December 20, 2023 the Fund may hold investments in direct property in
Central Europe. The Fund’s investment portfolio currently consists of property in Czechia, Poland, Ukraine and
Romania. These properties in principle are held for an indefinite period. However, the goal is to monetize a
significant portion of the portfolio, among other things, the assets in Ukraine, as well as non-core assets in
Poland. The Fund’s investment activities result in exposure to various risks, as also defined in the prospectus.
The Managing Board of the Fund determines the tactical investment mix. The Managing Board regularly
monitors the deviation between the previously determined tactical investment mix and the actual investment
mix. The risks are summarised in the table below:
Risk |
Risk |
Policy |
Notes |
Risk |
Impact |
Likelihood |
category |
appetite |
|||||
Market |
Mitigation |
15.41.2 |
High |
Medium |
High |
|
Strategy |
Concentration |
Avoidance / control |
15.41.3 |
Low |
Medium |
Medium |
Economic |
Acceptance |
15.41.4 |
High |
High |
High |
|
| Fraud |
Avoidance / |
15.41.5 |
Low |
Medium |
Low |
|
| mitigation |
||||||
| Operational |
Internal control |
Avoidance / |
15.41.5 |
Low |
Medium |
Low |
| mitigation |
||||||
Counterparty |
Mitigation |
15.41.6 |
Low |
Medium |
Low |
|
Integrity |
Avoidance |
15.41.7 |
Low |
Medium |
Low |
|
| Currency |
Mitigation / |
15.41.8 |
Medium |
Medium |
High |
|
| avoidance |
||||||
Interest rate |
Mitigation |
15.41.9 |
Low |
Medium |
High |
|
Price |
Acceptance |
15.41.10 |
High |
High |
High |
|
Financial |
Borrowed money / |
Avoidance / |
15.41.11 |
Low |
High |
Medium |
position |
credit |
mitigation |
||||
Rent |
Mitigation |
15.41.12 |
Medium |
Medium |
High |
|
Debtor |
Mitigation |
15.41.13 |
Medium |
Medium |
High |
|
Vacancy |
Mitigation |
15.41.14 |
Medium |
Medium |
High |
|
Liquidity |
Avoidance |
15.41.15 |
Low |
High |
Medium |
|
| Financial |
Outsourcing |
Avoidance |
15.41.16 |
Low |
Low |
Low |
| reporting |
||||||
| Regulations |
Mitigation |
15.41.17 |
Low |
Medium |
Medium |
|
Legal and |
Tax |
Mitigation / |
15.41.18 |
Low |
Medium |
High |
compliance |
acceptance |
|||||
| risk |
Legal |
Mitigation |
15.41.19 |
Low |
High |
High |
| ESG |
Mitigation / |
15.41.20 |
Low |
Medium |
Medium |
|
| avoidance |
The nature and scope of properties as at Statement of Financial Position’s date and the risk policy with regard
to the above-mentioned risks and other risks are discussed below.
147
Market risk is the risk of losses in positions arising from movements in market prices. Property values are
affected by many factors, including the outlook for economic growth, inflation rate, and developments on the
capital markets and the rental income at the time of sale of the property.
The greater the fluctuation in the development of these factors, the greater the risk. The Fund cannot influence
macro-economic factors that determine property value. However, through good investment property
management the Fund will try to mitigate the risk and will seek to maximise the attraction of the properties in
its portfolio to prospective tenants and purchasers. The Fund invests in countries which have different legal
systems to Western Europe. In some areas there is much less public information available than would be the
case in Western Europe.
Control of the market risk is determined by the Managing Board’s investment policy, which is aimed at
achieving investment results by purchasing investments that are assumed to have been undervalued and are
expected to benefit from the further development of the Czech, Polish, Ukrainian, and Romanian economy.
The market risk is managed on a day-to-day basis.
The Fund’s policy is
mitigation
. The risk appetite is high. The impact is considered medium; the likelihood is
15.41.3 Concentration risk
The concentration risk is the risk that can occur if the Fund has a large concentration of investments in certain
regions or types of properties or if the Fund depends on a limited number of large tenants. To reduce this risk,
investments of the Fund are spread across different types of properties in several regions in Central Europe
and the portfolio has many small and medium-sized tenants. The Fund has left the Košice real estate market,
by selling the last property it owned in Košice. As at Statement of Financial Position’s date the Fund did not
hold any investments anymore in Slovakia.
The Fund’s policy towards this risk is
Avoidance / control.
The risk appetite is low. The impact of this risk is
medium; the likelihood is medium.
15.41.4 Economic risk
Economic risk is derived from direct financial factors (developments in interest rates and inflation) and market
developments (changes in for example GDP growth and employment). The former tends to affect capital
values, the latter occupancy rates and rental levels. Economic risk is managed by the Fund through focussing
the Fund’s investments on flexible assets in economically stable regional centres and managing these assets
through local professional teams closely attuned to developments in local market conditions.
The Fund’s policy towards this risk is
Acceptance.
The risk appetite is high. The impact of economic risk is
high; the likelihood is also high.
15.41.5
Operational risk (fraud and internal control)
Operational risk is the risk of losses coming from failed internal processes, people or systems or from external
operational events. Examples of operational risk incidents are fraud, claims, losses, errors, violation of laws
and system failure. During the financial period, no material operational risks materialised.
The risk appetite is low. The Fund’s policy towards operational risks is
Avoidance
/
mitigation.
The Fund for
example does not tolerate fraud, executes an extensive supplier due diligence / know your customer analysis
for service contracts and for transactions and asks for Supervisory Board approval for the purchase or sale of
real estate. The impact of these risks is medium; the likelihood is low.
148
15.41.6
Counterparty risk (credit risk)
The counterparty (credit) risk can be defined as the risk of a counterparty being unable to fulfil its obligation to
the Fund associated with monetary assets. The Fund has a credit policy, and the counterparty risk is monitored
and controlled on a continuous basis. The risk is presumed to be low, given the short settlement period of most
of such monetary assets. The Fund does business with various parties; the most important are banks, tenants
and the local administrators of the properties. The Fund will mitigate this risk by regular contact with these
counterparties. If credits rise above certain risk limits, measures will be taken to reduce the risk for the Fund.
The carrying amount of monetary assets best represents the maximum credit risk exposure as at Statement
of Financial Position’s date. At this date, the Fund’s monetary assets exposed to credit risk amounted to the
following, related to the Fund’s net assets attributable to the holders of redeemable (ordinary, registered and
treasury) shares:
31-12-2025 | 31-12-2025 | 31-12-2024 | 31-12-2024 | |
In € 1,000 | In % | In € 1,000 | In % | |
Derivative financial instruments | 26 | 0.1 | 127 | 0.3 |
Tax assets 2 4 F 30 | 17 | 0.0 | 6 | 0.0 |
Trade and other receivables | 10,503 | 27.1 | 1,631 | 3.8 |
Cash and cash equivalents | 2,391 | 6.2 | 2,419 | 5.7 |
12,937 | 33.4 | 4,183 | 9.8 |
Other than the above-mentioned items, there were no significant concentrations of credit risk to counterparties
as at Statement of Financial Position’s date. No individual financial investment exceeded 10% of the net assets
attributable to the holders of redeemable (ordinary, registered and treasury) shares either as at Statement of
Financial Position’s date.
The following table sets out the ageing analysis of the Fund’s monetary assets. The amounts are based on
the carrying amount of monetary assets.
30
Exclusive of corporate income tax (
CIT
).
149
In € 1,000 |
31-12-2025 |
|||||
Current |
Up to |
1 to |
3 months |
More than |
||
(not past |
1 month |
3 months |
to 1 year |
1 year |
||
due) |
past due |
past due |
past due |
past due |
Total |
|
Gross monetary assets |
||||||
Derivative financial instruments |
26 |
- |
- |
- |
- |
26 |
Tax assets 30 |
17 |
- |
- |
- |
- |
17 |
Trade and other receivables |
9,698 |
53 |
16 |
749 |
262 |
10,778 |
Cash and cash equivalents |
2,391 |
- |
- |
- |
- |
2,391 |
| Impairment of monetary assets |
12,132 |
53 |
16 |
749 |
262 |
13,212 |
Derivative financial instruments |
- |
- |
- |
- |
- |
- |
Tax assets 30 |
- |
- |
- |
- |
- |
- |
Trade and other receivables |
10 |
1 |
2 |
10 |
252 |
275 |
Cash and cash equivalents |
- |
- |
- |
- |
- |
- |
| Net monetary assets |
10 |
1 |
2 |
10 |
252 |
275 |
Derivative financial instruments |
26 |
- |
- |
- |
- |
26 |
Tax assets 30 |
17 |
- |
- |
- |
- |
17 |
Trade and other receivables |
9,688 |
52 |
14 |
739 |
10 |
10,503 |
Cash and cash equivalents |
2,391 |
- |
- |
- |
- |
2,391 |
12,122 |
52 |
14 |
739 |
10 |
12,937 |
|
In € 1,000 |
31-12-2024 |
|||||
Current |
Up to |
1 to |
3 months |
More than |
||
(not past |
1 month |
3 months |
to 1 year |
1 year |
||
due) |
past due |
past due |
past due |
past due |
Total |
|
Gross monetary assets |
||||||
Derivative financial instruments |
127 |
- |
- |
- |
- |
127 |
| 2 5 F |
||||||
Tax assets 31 |
6 |
- |
- |
- |
- |
6 |
Trade and other receivables |
1,390 |
230 |
17 |
35 |
245 |
1,917 |
Cash and cash equivalents |
2,419 |
- |
- |
- |
- |
2,419 |
Impairment of monetary assets |
3,942 |
230 |
17 |
35 |
245 |
4,469 |
Derivative financial instruments |
- |
- |
- |
- |
- |
- |
Tax assets 31 |
- |
- |
- |
- |
- |
- |
Trade and other receivables |
14 |
5 |
2 |
29 |
236 |
286 |
Cash and cash equivalents |
- |
- |
- |
- |
- |
- |
| Net monetary assets |
14 |
5 |
2 |
29 |
236 |
286 |
Derivative financial instruments |
127 |
- |
- |
- |
- |
127 |
Tax assets 31 |
6 |
- |
- |
- |
- |
6 |
Trade and other receivables |
1,376 |
225 |
15 |
6 |
9 |
1,631 |
Cash and cash equivalents |
2,419 |
- |
- |
- |
- |
2,419 |
3,928 |
225 |
15 |
6 |
9 |
4,183 |
|
31
Exclusive of corporate income tax.
150
The impairment with regard to trade and other receivables relates to trade receivables and termination
derivative financial instruments. For further details with regard to these amounts is referred to section 15.9
“Trade and other receivables”. The following table sets out the pledges of the Fund’s financial assets.
In € 1,000 |
31-12-2025 |
||
Guarantee deposits |
|||
from tenants |
Other pledge |
Total |
|
Trade and other receivables |
56 |
- |
56 |
Prepayments and deferred expenses |
14 |
- |
14 |
70 |
- |
70 |
|
In € 1,000 |
31-12-2024 |
||
Guarantee deposits |
|||
from tenants |
Other pledge |
Total |
|
Trade and other receivables |
100 |
- |
100 |
Prepayments and deferred expenses |
28 |
- |
28 |
128 |
- |
128 |
|
The Fund’s policy towards this risk is
Mitigation.
The risk appetite is low. The impact is medium; the likelihood
15.41.7 Integrity risk
Within organizations there is a risk that people harm organizations by committing fraud or theft.
The Managing Board therefore evaluates the reliability and integrity of its staff. All staff in key positions
employed the Managing Board will be screened by “Pre-Employment Screening of Dutch Securities Institute”
(
DSI
). The Fund’s policy towards the integrity risk is
Avoidance
. The risk appetite is low. The impact of the risk
is medium; the likelihood low.
15.41.8 Currency risk
The currency risk can be defined as the risk that the fair value of investments and the fair value or future cash
flows of a financial instrument will fluctuate because of changes in foreign exchange rates. The Fund may
invest in properties in countries where the Euro has not (yet) been implemented. There is a currency risk that
the exchange rate fluctuates. The Fund has the option to mitigate the risk by using financial instruments to
hedge the currency risk. The Fund also seeks to mitigate / avoid the risk by concluding rental contracts in Euro.
The Fund invests in property in currencies other than the functional currency (the Euro) used in these
Consolidated Financial Statements. At present, the currencies involved are:
•
Czech Koruna (CZK);
•
Polish Zloty (PLN);
•
Ukrainian Hryvnia (UAH); and
•
Romanian Leu (RON).
Consequently, the Fund is exposed to the risk that the exchange rate of the functional currency in relation to
the foreign currency may develop in such a way that this has a negative impact on the value of the investment
portfolio in foreign currency.
Taking into account the high costs involved and Managing Board’s expectation that the EUR / CZK exchange
rate, the EUR / PLN exchange rate, the EUR / UAH exchange rate and the EUR / RON exchange rate will
continue to show relative stability over the long term, the Managing Board has opted not to hedge the currency
risk by means of financial derivative financial instruments, such as forward contracts. The EUR / UAH
exchange rate is more vulnerable to fluctuations, as the UAH is, compared to the other currencies, less liquid.
151
As at Statement of Financial Position’s date the Fund had the following exposure with regard to financial
assets. The percentages are based on the carrying amount of financial assets.
31-12-2025 | 31-12-2024 | |
In % | In % | |
Euro (EUR) | 84.8 | 76.8 |
Polish Zloty (PLN) | 7.8 | 13.3 |
Czech Koruna (CZK) | 5.7 | 6.5 |
Romanian Leu (RON) | 1.7 | 3.4 |
100.0 | 100.0 |
The following table sets out the Fund’s total exposure to currency risk and the net exposure to currencies of
the monetary assets and liabilities. The amounts are based on the carrying amount of monetary assets and
liabilities.
In € 1,000 | 31-12-2025 | ||
Monetary assets | Monetary liabilities | Net exposure | |
Euro (EUR) | 10,747 | 20,124 | -/- 9,377 |
Czech Koruna (CZK) | 904 | 1,217 | -/- 313 |
Polish Zloty (PLN) | 1,047 | 1,921 | -/- 874 |
Romanian Leu (RON) | 236 | 110 | 126 |
Ukrainian Hryvnia (UAH) | 3 | 46 | -/- 43 |
12,937 | 23,418 | -/- 10,481 | |
In € 1,000 | 31-12-2024 | ||
Monetary assets | Monetary liabilities | Net exposure | |
Euro (EUR) | 2,618 | 21,423 | -/- 18,805 |
Czech Koruna (CZK) | 443 | 3,035 | -/- 2,592 |
Polish Zloty (PLN) | 859 | 1,956 | -/- 1,097 |
Romanian Leu (RON) | 259 | 85 | 174 |
Ukrainian Hryvnia (UAH) | 4 | 56 | -/- 52 |
US Dollar (USD) | - | 939 | -/- 939 |
4,183 | 27,494 | -/- 23,311 | |
If the Euro had weakened by 5.0% in relation to one of the other
currencies, with all variables held constant,
net assets attributable to shareholders per the Consolidated Income Statement and equity would have
decreased by the amounts shown below:
31-12-2025 | 31-12-2024 | |
In € 1,000 | In € 1,000 | |
Czech Koruna (CZK) | 16 | 130 |
Polish Zloty (PLN) | 44 | 55 |
Romanian Leu (RON) | -/- 6 | -/- 9 |
Ukrainian Hryvnia (UAH) | 2 | 3 |
US Dollar (USD) | N.a. | 47 |
A 5% strengthening of the Euro against the above currencies would have resulted in an equal but opposite
effect on the above Financial Statement amounts, on the basis that all other variables remain constant.
The Fund’s policy is mitigation / avoidance. The risk appetite is medium; the impact is medium and the
likelihood high.
152
Interest rate risk
General
The interest rate risk is the risk the fair value or future cash flows of a financial instrument will fluctuate because
of changes in market interest rates. The Fund’s investment policy allows loans to be taken up. For reasons of
control of liquidity, the Fund holds limited cash and cash equivalents. The Fund has the possibility of investing
these funds in short-term deposits. The Fund manages its interest rate risk with the objective of reducing the
cash flow interest rate risk using derivative financial instruments.
In Czechia, Sberbank CZ (the former lender of the Czech portfolio) asserts that on October 25, 2022, they
terminated the interest rate swap as part of the insolvency process, thus reducing its value to zero. On February
9, 2024, Sberbank CZ rejected the objections of ACREB regarding the zero value of the interest rate swap.
The Fund has filed a lawsuit against Sberbank CZ seeking the termination of the interest rate swap, the value
of which was reduced to zero by Sberbank CZ. During 2024 the terminated interest rate swap claim has been
approved within the insolvency proceedings, and the Fund has already received 95% of the claim.
As at Statement of Financial Position’s date the Fund has contracted into the following derivative financial
instruments for the loans contracted in Poland (Interest rate swap II) and Czechia (Interest rate swap III).
| 31-12-2025 |
||||||
Average |
Line item in the SFP where |
|||||
Nominal |
fixed |
Termination |
the hedging instrument is |
|||
amount |
interest rate |
date |
Assets |
Liabilities |
included |
|
In € 1,000 |
In % |
In € 1,000 |
In € 1,000 |
|||
Interest rate swap I |
N.a. |
1.995 |
25-10-2022 |
4 |
- |
Trade and other receivables |
Derivative financial |
||||||
Interest rate swap II |
8,036 |
1.480 |
31-03-2026 |
26 |
- |
instruments |
Derivative financial |
||||||
Interest rate swap III |
845 |
3.790 |
30-06-2028 |
- |
- |
instruments |
| 31-12-2024 |
||||||
Average |
Line item in the SFP where |
|||||
Nominal |
fixed |
Termination |
the hedging instrument is |
|||
amount |
interest rate |
date |
Assets |
Liabilities |
included |
|
In € 1,000 |
In % |
In € 1,000 |
In € 1,000 |
|||
Interest rate swap I |
N.a. |
1.995 |
25-10-2022 |
4 |
- |
Trade and other receivables |
Derivative financial |
||||||
Interest rate swap II |
8,428 |
1.480 |
31-03-2026 |
127 |
- |
instruments |
153
Exposure to interest rate risk
The following table details the Fund’s exposure to interest rate risks. It includes the Fund’s financial assets
and financial liabilities, categorised by the earlier of contractual re-pricing or maturity date measured by the
carrying amount of the financial assets and financial liabilities.
In € 1,000 | 31-12-2025 | ||||||
Less | 1 month | 3 months | 1 year | More | Non- | ||
than | to | to | to | than | interest | ||
1 month | 3 months | 1 year | 5 years | 5 years | bearing | Total | |
Investments in associates | - | - | - | - | - | 3,545 | 3,545 |
Derivative financial instruments | - | 26 | - | - | - | - | 26 |
Tax assets | - | - | - | - | - | 153 | 153 |
Trade and other receivables | 1,164 | - | - | - | - | 9,339 | 10,503 |
Prepayments and deferred | |||||||
expenses | - | - | - | - | - | 267 | 267 |
Cash and cash equivalents | 2,389 | - | - | - | - | 2 | 2,391 |
Financial assets | 3,553 | 26 | - | - | - | 13,306 | 16,885 |
Loans and borrowings | 5,357 | 12,554 | 1,542 | 606 | 1,037 | 41 | 21,137 |
Effect of interest rate swaps | - | -/- 8,881 | - | - | - | - | -/- 8,881 |
Tax liabilities | - | - | - | - | - | 1,555 | 1,555 |
Trade and other payables | 4 | - | - | - | - | 2,134 | 2,138 |
Deferred income and tenant | |||||||
deposits | - | - | - | - | - | 439 | 439 |
Financial liabilities | 5,361 | 3,673 | 1,542 | 606 | 1,037 | 4,169 | 16,388 |
Total interest sensitivity gap | -/- 1,808 | -/- 3,647 | -/- 1,542 | -/- 606 | -/- 1,037 | -/- 8,640 | |
In € 1,000 | 31-12-2024 | ||||||
Less | 1 month | 3 months | 1 year | More | Non- | ||
than | to | to | to | than | interest | ||
1 month | 3 months | 1 year | 5 years | 5 years | bearing | Total | |
Investments in associates | - | - | - | - | - | 3,402 | 3,402 |
Derivative financial instruments | - | - | 127 | - | - | - | 127 |
Tax assets | - | - | - | - | - | 60 | 60 |
Trade and other receivables | 956 | - | - | - | - | 675 | 1,631 |
Prepayments and deferred | |||||||
expenses | - | - | - | - | - | 245 | 245 |
Cash and cash equivalents | 2,418 | - | - | - | - | 1 | 2,419 |
Financial assets | 3,374 | - | 127 | - | - | 4,383 | 7,884 |
Loans and borrowings | 24 | 8,890 | 13,477 | 250 | - | 47 | 22,688 |
Effect of interest rate swaps | - | - | -/- 8,428 | - | - | - | -/- 8,428 |
Tax liabilities | - | - | - | - | - | 707 | 707 |
Trade and other payables | - | - | - | - | - | 3,163 | 3,163 |
Deferred income and tenant | |||||||
deposits | - | - | - | - | - | 541 | 541 |
Liabilities directly associated | |||||||
with the assets held for sale | 11 | 15 | 67 | 404 | 1,022 | - | 1,519 |
Financial liabilities | 35 | 8,905 | 5,116 | 654 | 1,022 | 4,458 | 20,190 |
Total interest sensitivity gap | 3,339 | -/- 8,905 | -/- 4,989 | -/- 654 | -/- 1,022 | -/- 12,231 | |
154
An increase of 100 basis points in interest rates as at Statement of Financial Position’s date would have
decreased Group equity and profit for the period by € 86,000 (2024: € 122,000). A decrease of 100 basis points
in interest rates as at Statement of Financial Position’s date would have increased Group equity and profit for
the period by € 86,000 (2024: € 122,000). This analysis assumes that all other variables, in particular foreign
Cash flow value sensitivity analysis for variable-rate instruments
A possible change of 100 basis points (
bp
) in interest rates as at Statement of Financial Position’s date would
have increased and / or decreased profit for the period by the amounts shown below.
This analysis assumes that all other variables, in particular foreign currency exchange rates, remain constant.
In € 1,000 |
31-12-2025 |
31-12-2024 |
||
100 bp |
100 bp |
100 bp |
100 bp |
|
increase |
decrease |
increase |
decrease |
|
Variable rate instruments |
-/- 130 |
150 |
-/- 153 |
172 |
Interest rate swaps |
75 |
-/- 75 |
71 |
-/- 71 |
Cash flow sensitivity (net) |
-/- 55 |
75 |
-/- 82 |
101 |
Weighted average interest rate of loans and borrowings
The main part of the financial liabilities represents loans and borrowings. As at Statement of Financial
Position’s date the weighted average interest rate of loans and borrowings is as follows:
31-12-2025 |
31-12-2024 |
|
In % |
In % |
|
Weighted average interest rate of loans and borrowings |
5.45 |
6.44 |
The Fund’s policy is
mitigation.
The risk appetite is low. The impact of interest rate risk is medium; the likelihood
15.41.10 Price risk
The price risk can be defined as the risk that the value of the investments will fluctuate as a result of changes
in market prices (other than those arising from currency risk or interest rate risk), caused by factors specific to
the individual investment or the issuing institution or factors applicable to the market as a whole.
Rental risk includes the risk of loss of rental income due to vacancies, the ease with which space can be
leased, and fluctuations in market rents.
Property value risk includes the risk of loss of property value due to changing economic circumstances,
economic decline and / or oversupply of comparable real estate.
Since the Fund’s properties are stated at fair value, with both realised and unrealised value adjustments being
recognised directly in the Income Statement, a change in market conditions impacts directly on the Fund’s
investment result. The price risk is managed by the Fund by constructing a portfolio such that optimum
diversification across sectors and markets is achieved.
The Fund’s risk policy towards price risk is
Acceptance.
The risk appetite is high. The impact of this risk is
high; the likelihood is also high. For the sensitivity analysis of the buildings (including underground) is referred
to section 15.2.9 “Sensitivity analysis”.
155
15.41.11 Risk associated with investing with borrowed money
The risk associated with investing with borrowed money lies in the fact that shareholders might lose their
investment because the lender has a priority call on the proceeds of realisation. The investments are indeed
used as a security for the (bank) loans. However, this risk is limited to the equity within the borrower subsidiary
as there is no cross collateralisation and no parent entity guarantee. If the LTV-ratio is too high according to
the bank covenants it is possible that the Fund needs to sell property to improve LTV. The Fund manages this
risk by keeping the LTV below 60% and preferably around 50%. For the LTV reference is made to section
15.15.4 “Securities provided, bank covenants and ratios secured bank loans”.
The Fund’s policy towards this risk is
Avoidance / mitigation.
The risk appetite is low. The impact of this risk is
high; the likelihood is medium.
15.41.12 Rent risk
Rent levels may be subject to downward pressure in periods of economic weakness. In the market, vacancy
rates can increase, and rents will drop. This can also occur at other points of the economic cycle when new
development creates supply that temporarily exceeds demand. Rental risk can be best mitigated by
professional, active local asset management with the ability to deploy cash resources to modernise assets and
fund tenant incentives. It is also mitigated by ensuring diversification in lease contract expiry dates, to avoid a
number of contracts expiring contemporaneously into a weak market.
The Fund’s policy towards the risk is
Mitigation.
The risk appetite is medium. The impact of the rent risk is
medium; the likelihood is high.
15.41.13 Debtor risk
Debtor risk is the risk that arises from the possibility that a specific counterparty is unable to meet its obligations
to the Fund. The policy of the Fund is to reduce the default risk by applying a capital adequacy ratio to
(potential) tenants and by ensuring a diverse tenant base across industries (e.g. Food Retail, Financial
Services, Communications, Healthcare, Technology, Government, Transportation & Logistics) so that an
exposure to certain sectors is limited.
The Fund’s policy towards this risk is
Mitigation
. The risk appetite is medium. The impact of this risk is medium;
the likelihood is high.
15.41.14 Vacancy risk
The occupancy of properties may decrease by lease termination or bankruptcy of tenants. This risk is mitigated
and most effectively managed by the Fund by active local asset management and by a regular programme of
capital investment at asset level. For information about non-cancellable lease revenues reference is made to
section 15.25.5 “Non-cancellable lease revenues”.
The Fund’s policy towards this risk is
Mitigation.
The risk appetite is medium. The impact of this risk is medium;
the likelihood is high.
The liquidity risk can be defined as the risk of the Fund being unable to fulfil its obligation to counterparties
associated with monetary liabilities.
The Fund invests in real estate, a characteristic of which is its relative illiquidity; typically, the sale of real estate
takes time, and this could potentially affect the liquidity position of the Fund. The Fund will continuously monitor
and manage liquidity to meet its obligations.
156
The following table shows the contractual, undiscounted cash flows of the Fund’s monetary liabilities. The
loans and borrowings include the payable interest. The payable interest is calculated by using the weighted
average interest rate of loans and borrowings as at Statement of Financial Position’s date.
In € 1,000 | 31-12-2025 | ||||||
Less | 1 month | 3 months | 1 year | More | |||
than | to | to | to | than | No stated | ||
1 month | 3 months | 1 year | 5 years | 5 years | maturity | Total | |
Non-derivative liabilities | |||||||
Tax liabilities 2 6 F 32 | 143 | - | - | - | - | - | 143 |
Loans & borrowings | 5,486 | 11,662 | 1,792 | 2,314 | 940 | - | 22,194 |
Trade and other payables | 1,930 | 136 | - | 72 | - | - | 2,138 |
| Derivative liabilities | 7,559 | 11,798 | 1,792 | 2,386 | 940 | - | 24,475 |
Interest rate swaps | - | - | - | - | - | - | - |
Monetary liabilities | 7,559 | 11,798 | 1,792 | 2,386 | 940 | - | 24,475 |
In € 1,000 | 31-12-2024 | ||||||
Less | 1 month | 3 months | 1 year | More | |||
than | to | to | to | than | No stated | ||
1 month | 3 months | 1 year | 5 years | 5 years | maturity | Total | |
Non-derivative liabilities | |||||||
Tax liabilities 32 | 124 | - | - | - | - | - | 124 |
Loans & borrowings | 193 | 654 | 6,301 | 16,786 | 949 | - | 24,883 |
Trade and other payables | 3,011 | 152 | 3,163 | ||||
Liabilities directly associated with | |||||||
assets held for sale | 19 | 31 | 137 | 717 | 1,476 | - | 2,380 |
| Derivative liabilities | 3,347 | 837 | 6,438 | 17,503 | 2,425 | - | 30,550 |
Interest rate swaps | - | - | - | - | - | - | - |
Monetary liabilities | 3,347 | 837 | 6,438 | 17,503 | 2,425 | - | 30,550 |
Weighted remaining maturity of loans and borrowings
The main part of the financial liabilities represents loans and borrowings. As at Statement of Financial
Position’s date the weighted remaining maturity of loans and borrowings is as follows:
31-12-2025 | 31-12-2024 | |
In years | In years | |
Weighted remaining maturity of loans and borrowings | 2.32 | 3.75 |
32
Exclusive of corporate income tax.
157
Withdrawable credit facilities
As at Statement of Financial Position’s date the withdrawable credit facilities of the Fund are as follows:
31-12-2025 |
31-12-2024 |
|
In € 1,000 |
In € 1,000 |
|
Withdrawable credit facilities |
1,460 |
1,986 |
For further information with regard to the withdrawable credit facilities reference is made to section 15.15.4
“Securities provided, bank covenants and ratios secured bank loans”.
The Fund’s policy towards this risk is
Avoidance.
The risk appetite is low. The Fund works with budgets where
the debt service obligation towards banks is carefully monitored. The impact of this risk can be high; the
15.41.16 Outsourcing risk
Risk of outsourcing activities brings with it the risk that the counterparty does not fulfil its contractual obligations
or makes mistakes. The Fund periodically assesses the compliance of the agreements and acts as it deems
necessary, e.g. when mistakes occur.
The Fund’s policy towards this risk is
Avoidance
. The risk appetite, impact and likelihood are low.
15.41.17 Risks with regard to regulations
Political decisions to change the law on, for example, soil pollution, zoning, rent control and taxation can affect
the yield of the Fund. This risk is mitigated by the undertaking of detailed analysis of potentially relevant risks
(due diligence) before an acquisition. The Fund also follows new developments and adjusts its policy, if
necessary, based on changes in laws and regulations.
The Fund’s policy is
Mitigation
. The risk appetite is low. The impact of this risk is medium; the likelihood also
is medium.
15.41.18 Tax risk
Tax risk is the risk associated with possible changes in tax laws or changing interpretations and effects of
government policy and regulation.
The Fund’s policy towards this risk is
Mitigation / acceptance.
The Fund tries to mitigate this risk by using local
specialists on regulation and taxation. The risk appetite is low. The impact of this risk is medium; the likelihood
is high.
15.41.19 Legal risk
Legal risk is the risk associated with possible changes in legislation or changing interpretations. In normal
times legislative changes are proposed by governments and made subject to comment by interested parties
before finally being passed into law. This enables drafting errors and unintended consequences to be identified
and removed and market participants to prepare themselves carefully for the impact of such changes. The
COVID-19 pandemic has led to a wave of emergency legislation from governments across the region in which
the Fund invests. This legislation has not been subject to the usual consultation and review processes. As a
result, there is a significantly increased risk that such legislation will impact negatively on the interests of the
Fund and its subsidiaries. In particular, there is a risk that cancellation or deferment of lease obligations,
ostensibly to help retail tenants affected by the pandemic, will lead to a long-term diminution of value in some
of the Fund´s properties. The Managing Board will carefully assess all such legislation and seek to mitigate its
negative effects to the fullest extent possible by active asset management and by specific legal action.
The Fund’s policy is therefore
Mitigation
. The risk appetite is low. The impact can be high; the likelihood is
high.
158
15.41.20 ESG risk
ESG risk refers to the risk of non-compliance with ESG standards for properties, which can have adverse
effects. To mitigate this risk, the Fund actively strives to meet ESG standards by investing in energy-saving
measures, enhancing real estate, and fostering a positive social environment for tenants. As of now, the Fund
does not perceive significant ESG risks, such as refinancing of expiring loans in 2026 and beyond. However,
this may change in the future if banks establish higher ESG standards, which they presently do not.
The Fund's policy for managing this risk is
Mitigation / avoidance
, with a low-risk appetite. The impact of this
risk is considered medium, while the likelihood is medium.
As at Statement of Financial Position’s date the Fund has set-off the following financial assets and / or financial
liabilities:
In € 1,000 |
31-12-2025 |
||
Gross amounts before |
Gross amounts |
Net amounts |
|
set-off |
set-off |
presented in SFP |
|
Trade and other receivables |
10,516 |
-/- 13 |
10,503 |
Trade and other payables |
2,151 |
-/- 13 |
2,138 |
In € 1,000 |
31-12-2024 |
||
Gross amounts before |
Gross amounts |
Net amounts |
|
set-off |
set-off |
presented in SFP |
|
Trade and other receivables |
1,752 |
-/- 121 |
1,631 |
Trade and other payables |
3,284 |
-/- 121 |
3,163 |
The above set-off relates to a receivable towards Hypo NOE for the amount of € 13,000 with regard to accrued
interest of an interest rate swap. The receivable for an amount of € 13,000 has been set-off against the liability
towards Hypo Noe with regard to accrued interest of a secured bank loan.
The Fund does not intend to set-off other financial assets and / or financial liabilities and / or does not have
159
DISCLOSURES LEASES
15.42.1
Impact as at Statement of Financial Position’s date
The following table present the impact of the application of IFRS 16 as at Statement of Financial Position’s
date:
31-12-2025 |
31-12-2024 |
|
In € 1,000 |
In € 1,000 |
|
Right-of-use assets |
1,465 |
- |
Right-of-use assets held for sale |
- |
1,510 |
Total assets |
1,465 |
1,510 |
Non-current lease liabilities |
1,393 |
- |
Current lease liabilities |
100 |
1,519 |
Total liabilities |
1,493 |
1,519 |
For the specification and statement of changes in right-of-use assets reference is made to sections:
•
15.2.6 “Specification of right-of-use assets”;
•
15.2.7 “Statement of changes in right-of-use assets”;
•
15.12.9 “Specification of right-of-use assets held for sale”; and
•
15.12.10 “Statement of changes in right-of-use assets held for sale”.
For the statement of changes, analysis, and maturity analysis of undiscounted cash flows of lease liabilities
reference is made to sections:
•
15.15.5 “Statement of changes in lease liabilities”;
•
15.15.6 “Analysis of lease liabilities;
•
15.15.7 “Maturity analysis contractual undiscounted cash flows of lease liabilities”;
•
15.20.3 “Analysis of lease liabilities”; and
•
15.20.4 “Statement of changes in liabilities directly associated with assets held for sale”.
15.42.2
Amounts recognised in Consolidated Income Statement
The following table present the impacts of the application of IFRS 16 in the Consolidated Income Statement:
31-12-2025 |
31-12-2024 |
|
In € 1,000 |
In € 1,000 |
|
Valuation losses of right-of-use assets |
- |
38 |
Valuation losses of right-of-use assets held for sale |
97 |
127 |
Interest expense on lease liabilities |
95 |
99 |
Foreign exchange and currency results of lease liabilities |
- |
10 |
Foreign exchange and currency results of liabilities directly associated |
||
with the assets held for sale |
19 |
13 |
Expenses relating to short-term leases |
- |
- |
Expenses relating to leases of low-value assets, excluding short-term |
||
leases of low-value assets |
- |
- |
211 | 287 |
160
15.42.3
Amounts recognised in Consolidated Statement of Cashflows
The following table present the impacts of the application of IFRS 16 in the Consolidated Statement of
Cashflows:
31-12-2025 |
31-12-2024 |
|
In € 1,000 |
In € 1,000 |
|
Payment of lease liabilities |
- |
87 |
Payment of liabilities directly associated with the assets held for sale |
192 |
177 |
192 |
264 |
15.42.4
Analysis of lease payments
31-12-2025 |
31-12-2024 |
|
In € 1,000 |
In € 1,000 |
|
Fixed lease payments |
192 |
264 |
Variable lease payments |
- |
- |
192 |
264 |
DISCLOSURES CONSOLIDATED STATEMENT OF CASH FLOWS
15.43.1
Changes in cash flows arising from investing transactions
The following table shows the changes in cash flows arising from investing transactions, including:
•
changes arising from cash flows; and
•
non-cash changes.
In € 1,000 |
2025 |
||
Cash |
Non-cash |
||
Investing activities |
changes |
changes |
Total |
Acquisitions of / additions to owned investment property |
-/- 813 |
83 |
-/- 730 |
Acquisitions of / additions to assets held for sale (owned investment property) |
-/- 285 |
- |
-/- 285 |
Proceeds from the sale of assets held for sale (owned investment property) |
5,698 |
8,918 |
14,616 |
Dividend from associates |
245 |
-/- 122 |
123 |
4,845 |
9,419 |
14,264 |
|
In € 1,000 |
2024 |
||
Cash |
Non-cash |
||
Investing activities |
changes |
changes |
Total |
Acquisitions of / additions to owned investment property |
-/- 1,494 |
-/- 1,009 |
-/- 2,503 |
Acquisitions of / additions to assets held for sale (owned investment property) |
-/- 531 |
- |
-/- 531 |
Proceeds from the sale of assets held for sale (owned investment property) |
10,180 |
- |
10,180 |
Dividend from associates |
245 |
122 |
367 |
8,400 |
-/- 887 |
7,513 |
|
161
15.43.2
Changes in cash flows arising from financing transactions
The following table shows the changes in cash flows arising from financing transactions, including:
•
changes arising from cash flows; and
•
non-cash changes.
In € 1,000 |
2025 |
||
Cash |
Non-cash |
||
Financing activities |
changes |
changes |
Total |
Own shares issued |
- |
1,081 |
1,081 |
Share buy-back / Reverse Bookbuilding (treasury shares) |
-/- 40 |
40 |
- |
Proceeds from / acquisitions of secured bank loans |
594 |
- |
594 |
Proceeds from other loans and borrowings |
800 |
- |
800 |
Repayments of secured bank loans |
-/- 3,462 |
- |
-/- 3,462 |
Repayments of other loans and borrowings |
-/- 1,050 |
- |
-/- 1,050 |
Payment of liabilities directly associated with assets held for sale |
-/- 192 |
- |
-/- 192 |
(Amortisation) flat fee and transaction costs of secured bank loans |
-/- 18 |
85 |
67 |
-/- 3,368 |
1,206 |
-/- 2,162 |
In € 1,000 |
2024 |
||
Cash |
Non-cash |
||
Financing activities |
changes |
changes |
Total |
Share buy-back / Reverse Bookbuilding (treasury shares) |
-/- 2,005 |
-/- 40 |
-/- 2,045 |
Proceeds from / acquisitions of secured bank loans |
3,200 |
- |
3,200 |
Proceeds from other loans and borrowings |
2,000 |
- |
2,000 |
Repayments of secured bank loans |
-/- 9,113 |
- |
-/- 9,113 |
Repayments of other loans and borrowings |
-/- 3,984 |
- |
-/- 3,984 |
Payments of lease liabilities |
-/- 87 |
- |
-/- 87 |
Payment of liabilities directly associated with assets held for sale |
-/- 177 |
- |
-/- 177 |
(Amortisation) flat fee and transaction costs of secured bank loans |
-/- 48 |
88 |
40 |
(Amortisation) flat fee and transaction costs of other loans and borrowings |
-/- 15 |
47 |
32 |
-/- 10,229 |
95 |
-/- 10,134 |
RELATED PARTIES
15.44.1
Identity of related parties
For the Fund, the following categories of related parties were identified during the financial period:
I.
Managers in key positions, meaning the Managing Board and the Supervisory Board;
II.
Major investors (more than 20% voting rights);
III.
All organisational entities within the Group designated as Arcona Capital;
IV.
Investment trusts, investment funds and other investment companies which are managed by an
entity belonging to Arcona Capital;
V.
Investments undertaken by Arcona Capital, in which Arcona Capital has significant influence (more
than 20% of voting rights).
The members of the Managing Board and Supervisory Board members are considered to be key management
personnel.
Related parties include both natural and legal persons. Close members of the family of natural persons, being
related parties, are also classified as related parties.
162
Transactions with and / or interests of managers in key positions (I)
During the financial period, the Fund entered into the following transactions with the managers in key positions:
A.
the Managing Board received a remuneration (management fee) for an amount of € 1,059,000 (2024:
€ 1,180,000);
B.
the Managing Board reduced its own management fee by an amount equivalent to the asset
management fees paid by the Fund (and / or its subsidiaries) to Arcona Capital Czech Republic s.r.o.
for the amount of € 172,000 (2024: € 233,000);
C.
the Managing Board reduced its own management fee by an amount equivalent to the asset
management fees paid by the Fund (and / or its subsidiaries) to Arcona Capital Poland Sp.
z o.o. for the amount of € 195,000 (2024: € 199,000);
D.
the Managing Board reduced its own management fee by an amount equivalent to the asset
management fees paid by the Fund (and / or its subsidiaries) to Arcona Capital Bulgaria E.O.O.D.
for the amount of € 4,000 (2024: € 8,000);
E.
the Managing Board reduced its own management fee by an amount equivalent to the asset
management fees paid by the Fund (and / or its subsidiaries) to CEG South East Continent Unique
Real Estate Management Limited for the amount of € 10,000 (2024: € 65,000);
F.
the Managing Board received a sales fee for an amount of € nil (2024: € 37,000). The remaining
sales fee was received by local entities for an amount of € 84,000 (2024 € 204,000);
G.
the Managing Board received a sales performance-related fee for an amount of € 305,000 (2024:
€ 169,000);
H.
the Supervisory Board received a remuneration for an amount of € 23,000 (2024: € 28,000).
During the financial period, no other transactions occurred with members of the Managing Board and / or
members of the Supervisory Board.
For the personal interests of members of the Managing and Supervisory Board reference is made to section
20.3 “Personal interests”.
For the remuneration of the Managing Board reference is made to section 15.34 “Administrative expenses”.
For the calculation of the sales fee and sales performance-related fee reference is made to section 15.34.5
“Sales fee and sales performance-related fee.
For the remuneration of the Supervisory Board and the remuneration of the statutory directors’ reference is
made to section 15.35.3 “Analysis of Supervisory Board fees” and section 15.35.4 “Analysis of other operating
15.44.3
Specification major investors
As at Statement of Financial Position’s date the Fund identified the following major investors:
Direct real |
Indirect real |
Direct |
|||
voting rights |
voting rights |
potential |
Total |
||
| Name |
Type of share |
voting rights |
|||
In % |
In % |
In % |
In % |
||
Stichting Prioriteit APF |
Priority shares |
100.00 |
N.a. |
N.a. |
100.00 |
SPDI |
Ordinary & registered shares |
25.32 |
N.a. |
2.98 |
28.30 |
H.M. van Heijst |
Ordinary shares |
19.16 |
6.57 |
N.a. |
25.73 |
The voting rights are based on information in the Register
33
of substantial holdings and gross short positions
of the AFM, as at Statement of Financial Position’s date.
33
https://www.afm.nl/nl-nl/sector/registers/meldingenregisters/substantiele-deelnemingen/
163
15.44.4
Transactions with and / or interests of major investors (II)
During the financial period, the Fund entered into or maintained the following transactions with major investors:
2025 | 31-12-2025 | ||
Name | Kind of transaction | Amount of transaction | Carrying amount |
In € 1,000 | In € 1,000 | ||
SPDI | Acquisition 21.18%-share in Lelar Holdings Limited | - | - |
SPDI | Acquisition 3.17%-share in Lelar Holdings Limited | - | - |
Acquisition 100%-share in N-E Real Estate Park First | |||
SPDI | Phase S.r.l. | - | - |
SPDI | Receivable / current account | - | - |
SPDI | Acquisition 100%-share in Aisi Ukraine LLC | - | - |
Issuance of 79,471 pieces of registered shares (share- | |||
SPDI | based payments) | 1,081 | - |
H.M. van Heijst | Providing unsecured loan | - | - |
H.M. van Heijst | Payable interest unsecured loan provided | 32 | - |
2024 | 31-12-2024 | ||
Name | Kind of transaction | Amount of transaction | Carrying amount |
In € 1,000 | In € 1,000 | ||
SPDI | Acquisition 21.18%-share in Lelar Holdings Limited | - | 57 |
SPDI | Acquisition 3.17%-share in Lelar Holdings Limited | - | 16 |
| SPDI | Acquisition 100%-share in N-E Real Estate Park First | ||
| Phase S.r.l. | - | 47 | |
SPDI | Receivable / current account | -/- 6 | 85 |
SPDI | Acquisition 100%-share in Aisi Ukraine LLC | 2,095 | 1,152 |
Conversion 1,072,910 pieces of registered shares into | |||
SPDI | 1,072,910 pieces ordinary shares | - | - |
SPDI | 144,264 pieces of warrants expired | - | - |
H.M. van Heijst | Providing unsecured loan | 1,000 | 600 |
H.M. van Heijst | Payable interest unsecured loan provided | 76 | 18 |
164
15.44.5
Transactions with other related parties (III-IV-V)
During the financial period, the Fund entered into or maintained the following transactions with other related
parties:
2025 | 31-12-2025 | |||
Other | Amount of | Carrying | ||
Name | Kind of transaction | information | transaction | amount |
In € 1,000 | In € 1,000 | |||
Arcona Capital Czech Republic s.r.o. | Asset management fee | 172 | - | |
Arcona Capital Poland Sp. z o.o. | Asset management fee | 195 | - | |
Arcona Capital Bulgaria E.O.O.D. | Asset management fee | 4 | 4 | |
371 | 4 | |||
Arcona Capital Czech Republic s.r.o. | Sales fee | 84 | - | |
Arcona Capital Czech Republic s.r.o. | Advisory services | 13 | - | |
Several | Rental income | 268 m 2 | 70 | - |
Statutory directors | Wages and salaries | 21 | - |
2024 | 31-12-2024 | |||
Other | Amount of | Carrying | ||
Name | Kind of transaction | information | transaction | amount |
In € 1,000 | In € 1,000 | |||
Arcona Capital Czech Republic s.r.o. | Asset management fee | 233 | - | |
Arcona Capital Poland Sp. z o.o. | Asset management fee | 199 | - | |
Arcona Capital Bulgaria E.O.O.D. | Asset management fee | 8 | - | |
440 | - | |||
Arcona Capital Czech Republic s.r.o. | Sales fee | 204 | - | |
Arcona Capital Czech Republic s.r.o. | Advisory services | 18 | - | |
Several | Rental income | 268 m 2 | 65 | - |
Statutory directors | Wages and salaries | 12 | 4 |
15.44.6
Investments in other related parties (III-IV-V)
Investment trusts, investment funds and other investment companies managed by an entity within Arcona
Capital, do hold investments in companies in which the Fund also has investments. As at Statement of
Financial Position’s date the Fund held no investments in other related parties.
165
15.44.7
Transactions with related parties
During the financial period, the Fund entered into or maintained the following transactions with related parties
affiliated with the Managing Board of the Fund:
2025 |
31-12-2025 |
||
Name |
Kind of transaction |
Amount of transaction |
Carrying amount |
In € 1,000 |
In € 1,000 |
||
R.J. Barker |
Providing unsecured loan |
- |
250 |
R.J. Barker |
Payable interest unsecured loan provided |
24 |
6 |
2024 |
31-12-2024 |
||
Name |
Kind of transaction |
Amount of transaction |
Carrying amount |
In € 1,000 |
In € 1,000 |
||
R.J. Barker |
Providing unsecured loan |
- |
250 |
R.J. Barker |
Payable interest unsecured loan provided |
24 |
6 |
The Fund has not entered into any other transactions with parties affiliated with the Managing Board of
the Fund.
15.44.8
Loans from third parties
During the financial period, the Fund has entered into loan agreements with third parties. Those third parties
are not related parties to the Fund or the Managing Board but are investors in other funds managed by the
EVENTS AFTER STATEMENT OF FINANCIAL POSITION’S DATE
The following material events after Statement of Financial Position’s date have occurred:
A.
As at March 23, 2026, the Hypo NOE loan was successfully refinanced. Subsequent to the reporting
period, the Fund successfully refinanced the secured bank loan with Hypo NOE, which had been
classified as a current liability as at the Statement of Financial Position date due to its contractual
maturity on March 31, 2026. In March 2026, the Fund reached agreement with HYPO NOE on the
refinancing of this facility, resulting in a new loan with a long-term maturity term of five years
extending to March 2031. This refinancing strengthens the Fund’s financing structure, improves the
maturity profile of the Group’s debt, and provides increased long-term stability to the Fund’s capital
structure.
B.
In April 2026, the Patria Bank loan was fully repaid and settled. Subsequent to the reporting period,
the Fund fully repaid and settled the secured bank loan facility with Patria Bank. The loan had been
classified as a current liability as at the Statement of Financial Position date following a breach of the
bank covenants at that date, mainly resulting from the EOS Business Park (Romania) becoming fully
vacant during 2025. Following the full repayment of the Patria Bank facility, the outstanding exposure
under this financing has been eliminated and the related liability no longer forms part of the Group’s
financing structure. The settlement of the loan reduces the Fund’s overall bank financing exposure
and improves the Group’s leverage position.
For further information is referred to section 13.2 “Statement of compliance and future related assumptions”.
166
PARENT COMPANY FINANCIAL STATEMENTS 2025
167
16
PARENT
COMPANY
BALANCE
SHEET
After proposal result appropriation
Notes
31-12-2025
31-12-2024
In € 1,000
In € 1,000
Investments
Investments in group companies
19.1
20,753
25,876
Receivables from group companies
19.2
21,672
20,274
42,425
46,150
Receivables
Other receivables
19.3
345
461
Deferred expenses
19.4
4
4
349
465
Other assets
Cash at bank
19.7
205
529
Total assets
42,979
47,144
Shareholders’ equity
19.8
Issued capital
19.9
19,812
20,885
Share premium
19.10
21,186
21,077
Legal revaluation reserve
19.8.1
3,005
5,972
Legal reserve currency translation differences
19.8.1
-/- 714
-/- 279
Legal reserve investments in group companies
19.8.1
7,712
8,853
Retained earnings
19.8.1
-/- 12,224
-/- 14,032
38,777
42,476
Long-term liabilities
Private loans
19.12
250
250
Debts to group companies
19.13
622
597
872
847
Current liabilities
Private loans
19.12
1,467
1,717
Debts to group companies
19.13
774
910
Tax liabilities
19.14
2
16
Other liabilities
19.15
1
96
Accruals
19.16
1,086
1,082
Total current liabilities
3,330
3,821
Total shareholders’ equity and liabilities
42,979
47,144
168
17
PARENT
COMPANY
PROFIT
AND
LOSS
ACCOUNT
Notes
2025
2024
In € 1,000
In € 1,000
Income from investments
Interest
19.19
1,634
1,864
Realised valuation results of investments
Investments in group companies
19.20
259
1,257
Receivables from group companies
19.21
-
58
259
1,315
Unrealised valuation results of investments
Investments in group companies
19.22
-/- 3,318
-/- 1,160
Receivables from group companies
19.23
-/- 1,181
-/- 62
-/- 4,499
-/- 1,222
Other operating income
19.24
26
17
Total income
-/- 2,580
1,974
Administrative expenses
19.25
983
775
Other operating expenses
19.26
526
650
Interest expenses
19.28
255
553
Total expenses
1,764
1,978
Result before income tax
-/- 4,344
-/- 4
Income tax expense
19.29
1
28
Result after income tax
-/- 4,345
-/- 32
169
18
ACCOUNTING
PRINCIPLES
PARENT
COMPANY
FINANCIAL
STATEMENTS
18.1
GENERAL
The Parent Company Financial Statements for the financial period are part of the Consolidated Financial
Statements for the financial period.
18.2
SUMMARY OF SIGNIFICANT ACCOUNTING PRINCIPLES
The Parent Company Financial Statements have been prepared in accordance with the provisions of Part 9 of
Book 2 of the Dutch Civil Code (Titel 9, Boek 2 van het Burgerlijk Wetboek). For the purpose of determining
the principles of valuation of assets and liabilities and the determination of results for its Parent Company
Financial Statements, the Parent Company makes use of the option offered in Book 2, article 2:362 (8) of the
Dutch Civil Code. This means that the principles of valuation of assets and liabilities and determination of
results (hereinafter referred to as the “principles of valuation”) of the Fund’s Parent Company Financial
Statements are identical to those that have been applied for the Consolidated Financial Statements. In this
context investment in group companies, on which significant influence is exercised, are valued at Net Asset
Value. The Consolidated Financial Statements have been prepared in accordance with the standards adopted
by the International Accounting Standards Board (“
IASB
”) and accepted by the European Union (hereinafter
referred to as “EU-IFRS”). Reference is made to sections 13.7 “Basis of preparation of the consolidated
financial statements” to 13.41 “Income tax expense”, inclusive for a description of those principles.
18.3
BASIS OF PREPARATION OF THE PARENT COMPANY FINANCIAL STATEMENTS
18.3.1
Investments in group companies
Investments in group companies in which the Parent Company either exercises voting control or effective
management responsibility are valued at Net Asset Value. The initial recognition in the accounts and valuations
at balance sheet dates is made at Net Asset Value. The value is adjusted with the share of the Parent Company
in the results of the group company, based on the principles for determining results as applied in the
Consolidated Financial Statements and with the share in the other movements in equity of the group company
with effect from the date on which control commences.
In case the value of the group company is negative and the Parent Company has also provided a loan to the
corresponding group company a provision loan to group companies will arise.
In case the value of the group company is reduced to zero, additional losses are provided for, and a liability is
recognised, only to the extent that the Parent Company has incurred legal or constructive obligations or made
payments on behalf of the group company. If the group company subsequently reports profits, the Parent
Company resumes recognising its share of those profits only after its share of the profits equals the share of
losses not recognised.
The Net Asset Value of the foreign group companies is translated into Euros at the exchange rate as at the
balance sheet date. The results of foreign group companies are translated into Euros at the exchange rates at
the dates of the transactions. For practical reasons, the average monthly exchange rates for the financial
period are used to approximate the exchange rates at the dates of the transactions, however only if the
exchange rates do not fluctuate significantly.
170
18.3.2
Receivables from group companies
Receivables from group companies are initially measured at fair value and subsequently measured at
amortised cost. As at balance sheet date the receivables from group companies are translated into Euros at
the exchange rate as at the balance sheet date. The recognition and determination of impairments takes place
in a forward-looking manner based on the expected credit loss model (
ECL
). The ECL model applies to the
receivables from group companies. Due to the fact that investments in group companies are considered as a
combination of assets and liabilities, this means in general that expected credit losses on receivables from
group companies are eliminated. The elimination is recognised in the carrying amount of the receivables from
group companies.
18.3.3
Acquisitions through share-based payments
In case the Fund acquires investments in group companies, receivables from group companies, investments
in associates or other assets by share-based payments (IFRS 2), the difference between the fair value of those
assets and the purchase price agreed is recognised directly into share premium.
18.3.4
Issued capital
Incremental costs directly attributable to the issue of (ordinary and registered) shares are recognised as a
deduction from shareholders’ equity.
When equity shares are repurchased (e.g. through share buy-back or reverse bookbuilding), the consideration
paid, which includes directly attributable costs, is recognized as a deduction from shareholders’ equity. The
Parent Company classifies the repurchased shares as treasury shares at the payment date to its liquidity
provider and charges them from the retained earnings, including directly attributable costs. If the treasury
shares are sold or reissued later, the amount received is recognized as an increase in shareholders’ equity,
and any surplus or deficit resulting from the transaction is presented within share premium. There is no impact
on the profit and loss account when the company buys back, sells, issues, or cancels its own shares.
18.3.5 Share premium
Share premium comprises the amount paid in by the shareholders on ordinary and registered shares of
the Parent Company over and above the nominal value. The uplift received on issuance of own ordinary and
registered shares, or the reduction applied on redemption of own ordinary and registered shares is recognised
directly into share premium.
18.3.6
Legal revaluation reserve
The legal revaluation reserve comprises the cumulative unrealised positive net changes in the fair value of the
properties held by the investments in group companies (owned investment property, investment property under
development as well as properties classified as assets held for sale), less the related deferred tax liabilities.
The deferred tax liabilities are deducted in accordance with the principles of valuation for deferred taxes.
In case of sale of property the cumulative unrealised positive net change in the fair value of the property sold,
as well as the related deferred tax liabilities, are no longer stated in the legal revaluation reserve but recognised
under retained earnings.
18.3.7
Legal reserve currency translation differences
Results arising from translation of net investments in group companies outside the Euro-zone into the Parent
Company’s functional currency (Euro) are recognised directly in the shareholders’ equity in legal reserve
currency translation differences. In the event of reduction or sale of the net investment in group companies the
cumulative exchange differences related to that group company are (proportionally) reclassified to profit or
loss.
171
18.3.8
Legal reserve investments in group companies
The Parent Company maintains a legal reserve for the amount of its share in the positive result in its group
companies and of its share in direct increases in equity since the initial recognition of the group company was
made. Negative cumulative results in a group company since its first valuation are not considered.
The legal reserve investments in group companies will be reduced by:
•
distributions to which the Parent Company, until the moment of adoption of its own Financial
Statement, has acquired an entitlement;
•
direct decreases in equity of the group company;
•
distributions which the Parent Company may affect without restrictions;
•
the amount of legal revaluation reserve of the properties held by the group company.
The distributions as mentioned in this section do not include distributions made in the form of shares.
18.3.9
Result from investments in group companies
The share of the results from investments in group companies comprises the Parent Company’s share in the
results of the group companies, including the revaluation result of the assets held by the group companies.
The result from investments in group companies has been determined on the basis of the principles of valuation
adopted by the Parent Company. Results from transactions between the Parent Company and the group
companies, as well as between the group companies themselves, are recognised as far as they are realised.
If the group companies have been acquired in the course of the financial period, the Parent Company accounts
for the results from investments in group companies with effect from the date on which control commenced.
18.4
SIZE AND COMPOSITION OF THE EQUITY AND RESULTS IN THE CONSOLIDATED AND
PARENT COMPANY FINANCIAL STATEMENTS
As the Parent Company makes use of the option provided in Book 2, article 2:362 (8) of the Dutch Civil Code,
the size of the Group equity (in the Consolidated Statement of Financial Position) and the shareholders‘ equity
(in the Parent Company Balance Sheet) is identical.
The composition of the shareholders’ equity (in the Consolidated Statement of Financial Position) and the
shareholders‘ equity (in the Parent Company Balance Sheet) is not identical, caused by the “Legal reserve
investments in group companies” in the Parent Company Financial Statements.
Since the Parent Company makes use of the option provided in Book 2, article 2:362 (8) of the Dutch Civil
Code, the profit for the period in the Consolidated Income Statement and profit for the period in the Parent
Company Profit and Loss Account is identical.
172
19
NOTES
TO
THE
PARENT
COMPANY
FINANCIAL
STATEMENTS
19.1
INVESTMENTS IN GROUP COMPANIES
19.1.1
Analysis of investments in group companies
31-12-2025
31-12-2024
In € 1,000
In € 1,000
Arcona Capital RE Bohemia s.r.o.
6,358
7,413
Arcona Capital RE Slovakia s.r.o.
4,789
7,978
Arcona Capital Real Estate Poland Sp. z o.o.
2,418
2,535
Arcona Capital Real Estate Trio Sp. z o.o.
5,794
6,354
Arcona Real Estate B.V.
615
587
Aisi Bela LLC
779
1,009
Arcona Black Sea Real Estate B.V.
-
-
20,753
25,876
The companies indicated above are included in the Consolidated Financial Statements. For further analysis of
the investments in group companies’ reference is made to section 15.1.1 “Consolidated subsidiaries”.
19.1.2
Statement of changes in investments in group companies
2025
2024
In € 1,000
In € 1,000
Balance as at 1 January
25,876
29,659
Additions
-
2,019
Share in result of group companies
-/- 3,318
-/- 1,160
Distributions
-/- 1,634
-/- 3,870
Exchange rate differences
-/- 171
-/- 183
Disposals
-
-/- 807
Other movements directly in shareholders’ equity
-
218
Balance as at 31 December
20,753
25,876
The “Distributions” for the amount of € 1,634,000 negative relates to dividend distributions from Arcona Capital
RE Bohemia s.r.o.
19.1.3
Securities provided
As at balance sheet date the following securities were provided:
•
the issued shares of Arcona Capital Real Estate Poland Sp. z o.o. are pledged to Hypo Noe.
For further information on the pledges to credit institutions and bank covenants reference is made to section
15.15.4 “Securities provided, bank covenants and ratios secured bank loans”.
173
19.2
RECEIVABLES FROM GROUP COMPANIES
19.2.1
Analysis of receivables from group companies
31-12-2025
31-12-2024
In € 1,000
In € 1,000
Loans to group companies
21,672
20,274
19.2.2
Analysis of loans to group companies
31-12-2025
31-12-2024
In € 1,000
In € 1,000
Arcona Capital Real Estate Poland Sp. z o.o.
9,749
9,198
Arcona Capital Black Sea Real Estate B.V.
7,103
6,364
Arcona Poland Project 5 Sp. z o.o.
4,594
4,534
Aisi Bela LLC
226
178
21,672
20,274
As at balance sheet date the weighted average interest rate on all receivables from group companies is 6.31%
per annum (December 31, 2024: 6.33% per annum).
19.2.3
Statement of changes in loans to group companies
2025
2024
In € 1,000
In € 1,000
Balance as at 1 January
20,274
22,219
Loans advanced
2,830
3,142
Redemption on loans advanced
-/- 245
-/- 4,977
Exchange rate differences
-/- 6
-/- 48
Provision
-/- 1,181
-/- 62
Balance as at 31 December
21,672
20,274
19.3
OTHER RECEIVABLES
All other receivables have a maturity within one year.
19.3.1
Analysis of other receivables
31-12-2025
31-12-2024
In € 1,000
In € 1,000
Dividend from investments in group companies
206
146
Interest on receivables to group companies
28
306
Current account to group companies
111
9
345
461
174
19.3.2
Specification of dividend from investments in group companies
31-12-2025
31-12-2024
In € 1,000
In € 1,000
Arcona Capital Real Estate Trio Sp. z o.o.
-
146
Arcona Capital RE Bohemia s.r.o.
206
-
206
146
19.3.3
Specification of interest on receivables to group companies
31-12-2025
31-12-2024
In € 1,000
In € 1,000
Arcona Capital Real Estate Trio Sp. z o.o.
-
286
Aisi Bela LLC
28
20
28
306
19.3.4
Specification of current account to group companies
31-12-2025
31-12-2024
In € 1,000
In € 1,000
N-E Real Estate Park First Phase S.r.l.
111
9
19.4
DEFERRED EXPENSES
All deferred expenses have a maturity within one year.
19.4.1
Analysis of deferred expenses
31-12-2025
31-12-2024
In € 1,000
In € 1,000
Prepayments
4
4
175
19.5
RECOGNISED DEFERRED TAXES
19.5.1
Specification of recognised deferred taxes
In € 1,000
31-12-2025
Recognised
deferred tax
assets
Recognised
deferred tax
liabilities
Total
deferred
taxes
Receivables from group companies
-
27
-/- 27
Tax losses (carried forward)
27
-
27
Deferred taxes before set-off
27
27
-
Set-off deferred taxes
-/- 27
-/- 27
-
-
-
-
In € 1,000
31-12-2024
Recognised
deferred tax
assets
Recognised
deferred tax
liabilities
Total
deferred
taxes
Receivables from group companies
-
28
-/- 28
Tax losses (carried forward)
28
-
28
Deferred taxes before set-off
28
28
-
Set-off deferred taxes
-/- 28
-/- 28
-
-
-
-
19.5.2
Analysis of recognised deferred tax assets concerning tax losses (carried forward)
31-12-2025
31-12-2024
In € 1,000
In € 1,000
Will expire
-
-
Will never expire
27
28
27
28
Based on the tax forecast the Managing Board expects (considering local tax law and regulations) that in the
future there will be sufficient taxable profit to set-off these recognised tax losses.
176
19.6
UNRECOGNISED DEFERRED TAXES
19.6.1
Specification of unrecognised deferred taxes
In € 1,000
31-12-2025
Unrecognised
Unrecognised
deferred tax
deferred tax
assets
liabilities
Total
Tax losses (carried forward)
2,201
-
2,201
Receivables from group companies
720
-
720
2,921
-
2,921
In € 1,000
31-12-2024
Unrecognised
Unrecognised
deferred tax
deferred tax
assets
liabilities
Total
Tax losses (carried forward)
2,096
-
2,096
Receivables from group companies
415
-
415
2,511
-
2,511
19.6.2
Analysis of unrecognised deferred tax assets concerning tax losses (carried forward)
31-12-2025
31-12-2024
In € 1,000
In € 1,000
Will expire
-
-
Will never expire
2,201
2,096
2,201
2,096
The Managing Board expects (considering local tax law and regulations) that in the future there will be
insufficient taxable profit to set-off these unrecognised deferred taxes.
Mainly as a result of applying the participation exemption it is expected the Parent Company will not generate
taxable profits in the (near) future. Therefore, the Managing Board is of the opinion no deferred tax assets can
be recognised.
19.6.3
Statement of changes in unrecognised deferred taxes
2025
2024
In € 1,000
In € 1,000
Balance as at 1 January
2,511
2,409
Adjustments related to prior years
-/- 7
-
Additions / withdrawals
417
102
Balance as at 31 December
2,921
2,511
19.7
CASH AT BANK
Cash at bank is entirely at the free disposal of the Parent Company.
177
19.8
SHAREHOLDERS’ EQUITY
19.8.1
“Closed-end” structure
The Fund operates as a closed-end investment company. Ordinary shares can be traded continuously through
Euronext Fund Services in Amsterdam (The Netherlands).
The registered shares are currently restricted from trading on Euronext Fund Services. There are no other
restrictions with regard to registered shares.
Capital management
All issued ordinary, treasury and registered shares are part of the Fund’s capital management responsibilities.
The Fund’s objectives when managing capital are to safeguard the Fund’s ability to continue as a going
concern in order to provide returns for shareholders and benefits for other stakeholders and to maintain an
optimal capital structure to reduce the cost of capital. The Fund reserves the right to declare dividends and /
or distributions if the Managing Board so decides.
Shares of the Fund shall be issued by the Managing Board. The Managing Board shall also determine the time
of the issuance, the issue price and the other conditions of the issuance.
The Managing Board shall be authorised to perform legal acts relating to contributions in kind on ordinary
shares and other legal acts referred to in Section 2:94 of the Dutch Civil Code, without the approval of the
General Meeting. A resolution to enter into these legal acts shall require the approval of the Supervisory Board.
The Managing Board is authorised to alienate shares in its own capital or depository receipts thereof, held by
178
Statement of changes in shareholders’ equity
Legal reserve |
Legal reserve |
||||||
Legal |
currency |
investments |
Share- |
||||
Issued |
Share |
revaluation |
translation |
in group |
Retained |
holders’ |
|
capital |
premium |
reserve |
differences |
companies |
earnings |
equity |
|
In € 1,000 |
In € 1,000 |
In € 1,000 |
In € 1,000 |
In € 1,000 |
In € 1,000 |
In € 1,000 |
|
Balance as at January 1, 2025 |
20,885 |
21,077 |
5,972 |
-/- 279 |
8,853 |
-/- 14,032 |
42,476 |
Result after income tax |
- |
- |
- |
- |
- |
-/- 4,345 |
-/- 4,345 |
Change in legal revaluation reserve |
- |
- |
-/- 2,967 |
- |
- |
2,967 |
- |
Change in legal reserve currency |
|||||||
translation differences |
- |
- |
- |
-/- 435 |
- |
- |
-/- 435 |
Change in legal reserve |
|||||||
| investments in group companies |
- |
- |
- |
- |
-/- 1,141 |
1,141 |
- |
Own shares issued |
397 |
684 |
- |
- |
- |
- |
1,081 |
Treasury shares repurchased |
-/- 1,470 |
-/- 575 |
- |
- |
- |
2,045 |
- |
Balance as at December 31, 2025 |
19,812 |
21,186 |
3,005 |
-/- 714 |
7,712 |
-/- 12,224 |
38,777 |
Legal reserve |
Legal reserve |
||||||
Legal |
currency |
investments |
Share- |
||||
Issued |
Share |
revaluation |
translation |
in group |
Retained |
holders’ |
|
capital |
premium |
reserve |
differences |
companies |
earnings |
equity |
|
In € 1,000 |
In € 1,000 |
In € 1,000 |
In € 1,000 |
In € 1,000 |
In € 1,000 |
In € 1,000 |
|
Balance as at January 1, 2024 |
20,885 |
21,077 |
7,683 |
564 |
7,750 |
-/- 12,563 |
45,396 |
Result after income tax |
- |
- |
- |
- |
- |
-/- 32 |
-/- 32 |
Change in legal revaluation reserve |
- |
- |
-/- 1,711 |
- |
- |
1,711 |
- |
Change in legal reserve currency |
|||||||
translation differences |
- |
- |
- |
-/- 843 |
- |
- |
-/- 843 |
Change in legal reserve |
|||||||
| investments in group companies |
- |
- |
- |
- |
1,103 |
-/- 1,103 |
- |
Treasury shares repurchased |
- |
- |
- |
- |
- |
-/- 2,045 |
-/- 2,045 |
Balance as at December 31, 2024 |
20,885 |
21,077 |
5,972 |
-/- 279 |
8,853 |
-/- 14,032 |
42,476 |
19.9
ISSUED CAPITAL
Analysis of issued capital
31-12-2025 |
31-12-2025 |
31-12-2024 |
31-12-2024 |
|
In pieces |
In € 1,000 |
In pieces |
In € 1,000 |
|
Ordinary shares (at € 5.00 each) |
3,882,965 |
19,415 |
3,882,965 |
19,415 |
Registered shares (at € 5.00 each) |
79,471 |
397 |
- |
- |
Subtotal profit-sharing shares (at € 5.00 each) |
3,962,436 |
19,812 |
3,882,965 |
19,415 |
Treasury shares (at € 5.00 each) |
- |
- |
294,118 |
1,470 |
Priority shares (at € 5.00 each) |
1 |
- |
1 |
- |
3,962,437 |
19,812 |
4,177,084 |
20,885 |
19.9.2
Ordinary shares
The holders of ordinary shares (without division in share classes) are entitled to dividends, the distribution of
which has been resolved by the General Meeting of Shareholders. The holders of ordinary shares are entitled
to exercise one vote per ordinary share at the General Meeting of Shareholders.
179
19.9.3
Statement of changes in ordinary shares
2025
2025
2024
2024
In pieces
In € 1,000
In pieces
In € 1,000
Balance in issue as at 1 January
3,882,965
19,415
3,104,173
15,521
Conversion of registered shares
79,471
397
1,072,910
5,364
Share buy-back / Reverse Bookbuilding
-
-
-/- 294,118
-/- 1,470
Balance in issue as at 31 December fully paid
3,962,436
19,812
3,882,965
19,415
19.9.4
Registered shares
The registered shares (without division in share classes) are currently restricted from trading on Euronext Fund
Services in Amsterdam and the Prague Stock Exchange. There are no other restrictions with regard to
registered shares.
19.9.5
Statement of changes in registered shares
2025
2025
2024
2024
In pieces
In € 1,000
In pieces
In € 1,000
Balance in issue as at 1 January
-
-
1,072,910
5,364
Issued during the financial period
79,471
397
-
-
Conversion into ordinary shares
-/- 79,471
-/- 397
-/- 1,072,910
-/- 5,364
Balance in issue as at 31 December fully paid
-
-
-
-
19.9.6 Treasury shares
The treasury shares are ordinary shares, held by the Parent Company. Treasury shares are restricted from
voting rights and / or dividends.
19.9.7
Statement of changes in treasury shares
2025
2025
2024
2024
In pieces
In € 1,000
In pieces
In € 1,000
Balance in issue as at 1 January
294,118
1,470
-
-
Share buy-back / Reverse Bookbuilding
-
-
294,118
1,470
Cancellation during the financial period
-/- 294,118
-/- 1,470
-
-
Balance in issue as at 31 December fully paid
-
-
294,118
1,470
Following the resolution of the General Meeting of Shareholders (GM) of the Fund dated June 25, 2025, the
GM approved the proposal of the members of the Stichting Prioriteit (the Priority) to cancel 294,118 pieces of
treasury shares, which has been repurchased by the Fund during the Reverse Bookbuilding Tender Offer
period (from September 19, 2024 to October 16, 2024) and to reduce the Parent Company’s issued capital for
the same amount.
19.9.8
Priority shares
From the profit earned in a financial period, primarily and as far as possible a dividend is distributed on the
priority shares amounting to seven per cent (7%) on an annual basis, calculated over the nominal value of the
priority shares. No further distributions are made on the priority shares. For the (special) rights with regard to
the holders of priority shares reference is made to section 20.4 “Special controlling rights”.
180
19.9.9
Statement of changes in priority shares
2025
2025
2024
2024
In pieces
In € 1,000
In pieces
In € 1,000
Balance in issue as at 1 January
1
-
1
-
Issued during the financial period
-
-
-
-
Redeemed during the financial period
-
-
-
-
Balance in issue as at 31 December fully paid
1
-
1
-
19.9.10
Analysis of authorised share capital
31-12-2025
31-12-2025
31-12-2024
31-12-2024
In pieces
In € 1,000
In pieces
In € 1,000
Ordinary shares (at € 5.00 each)
4,999,999
25,000
4,999,999
25,000
Priority shares (at € 5.00 each)
1
-
1
-
5,000,000
25,000
5,000,000
25,000
19.9.11
Settlement of acquisitions through share-based payments
During the financial period, the following (final) settlements of acquisitions through share-based payments took
place:
•
As at February 6, 2025 the Managing Board provided 68,782 registered shares of the Fund to SPDI
as part of the (final) settlement for the acquisition of a 100%-stake in Aisi Ukraine LLC at an issuance
price of € 11.16 per registered share;
•
As at February 6, 2025 the Managing Board provided 10,689 registered shares of the Fund to SPDI
as part of the (final) settlement for the acquisition of a 100%-stake in N-E Real Estate Park First
Phase S.r.l. and a 24.35%-stake in Lelar Holdings Limited at an issuance price of € 11.16 per
registered share.
19.10
SHARE PREMIUM
For the statement of changes in share premium reference is made to section 19.8.1 “Statement of changes in
shareholders’ equity”.
The paid-up share premium for tax purposes as at December 31, 2025 was € 25,188,000 (December 31, 2024:
€ 25,297,000).
19.11
DEFERRED TAX LIABILITIES
For the specification and analysis of the (un)recognised deferred tax liabilities reference is made to section
19.5 “Recognised deferred taxes and section 19.6 “Unrecognised deferred taxes”.
181
19.12
PRIVATE LOANS
19.12.1
Specification of private loans
2025
2024
In € 1,000
In € 1,000
Non-current part of private loans
250
250
Current part of private loans
1,467
1,717
1,717
1,967
19.12.2
Analysis of private loans
31-12-2025
31-12-2024
In € 1,000
In € 1,000
Unsecured loans third parties
1,717
1,967
19.12.3
Statement of changes in private loans
2025
2024
In € 1,000
In € 1,000
Balance as at 1 January
1,967
2,122
Loans advanced
800
2,000
Redemptions
-/- 1,050
-/- 2,184
(Amortisation) flat fee and transaction costs
-
29
Balance as at 31 December
1,717
1,967
For the conditions and securities provided of the private loans reference is made to section 15.15.9 “Analysis
of other loans and borrowings” and section 15.15.10 “Securities provided of other loans and borrowings”.
19.12.4
Maturity analysis of private loans
31-12-2025
31-12-2024
In € 1,000
In € 1,000
Less than 1 year
1,467
1,717
1 year to 5 years
250
250
More than 5 years
-
-
1,717
1,967
19.13
DEBTS TO GROUP COMPANIES
19.13.1
Specification of debts due to group companies
2025
2024
In € 1,000
In € 1,000
Non-current part of debts due to group companies
622
597
Current part of debts due to group companies
774
910
1,396
1,507
182
19.13.2
Analysis of debts to group companies
31-12-2025
31-12-2024
In € 1,000
In € 1,000
Loans due to group companies
1,062
1,037
Interest on loans due to group companies
334
470
1,396
1,507
19.13.3
Maturity analysis of debts due to group companies
31-12-2025
Loans due to
group companies
Interest on loans due to
group companies
Total
In € 1,000
In € 1,000
In € 1,000
Less than 1 year
440
334
774
1 year to 5 years
622
-
622
More than 5 years
-
-
-
1,062
334
1,396
31-12-2024
Loans due to
group companies
Interest on loans due to
group companies
Total
In € 1,000
In € 1,000
In € 1,000
Less than 1 year
440
470
910
1 year to 5 years
597
-
597
More than 5 years
-
-
-
1,037
470
1,507
19.13.4
Specification of loans due to group companies
31-12-2025
31-12-2024
In € 1,000
In € 1,000
Arcona Capital RE Slovakia s.r.o.
440
440
Arcona Real Estate B.V.
622
597
1,062
1,037
As at balance sheet date the weighted average interest rate on all loans due to group companies is 7.21% per
annum (December 31, 2024: 7.21%).
19.13.5
Statement of changes in loans due to group companies
2025
2024
In € 1,000
In € 1,000
Balance as at 1 January
1,037
3,995
Loans advanced
41
2,684
Redemptions
-/- 16
-/- 5,644
Exchange rate differences
-
2
Balance as at 31 December
1,062
1,037
183
19.13.6
Specification of interest on loans due to group companies
31-12-2025
31-12-2024
In € 1,000
In € 1,000
Arcona Capital RE Slovakia s.r.o.
81
48
Arcona Capital Real Estate Trio Sp. z o.o.
253
422
334
470
19.14
TAX LIABILITIES
31-12-2025
31-12-2024
In € 1,000
In € 1,000
Value Added Tax (
VAT
)
2
16
19.15
OTHER LIABILITIES
All other liabilities have a maturity within one year.
19.15.1
Analysis of other liabilities
31-12-2025
31-12-2024
In € 1,000
In € 1,000
Trade payables
1
96
19.16
ACCRUALS
All accruals have a maturity within one year.
19.16.1
Analysis of accruals
31-12-2025
31-12-2024
In € 1,000
In € 1,000
Administrative expenses
519
436
Other operating expenses
224
255
Sales performance-related fee
305
169
Payable settlement acquisitions
-
134
Interest payables
38
56
Sales fee
-
32
1,086
1,082
184
19.17
NON-CONTINGENT LIABILITIES
As at balance sheet date the Parent Company was not subject to any contractual obligation concerning for
example investments or other non-contingent liabilities that require settlement in a future financial period.
19.18
CONTINGENT LIABILITIES
As at balance sheet date the Parent Company has the following contingent liabilities:
A.
The Parent Company is at the head of the fiscal unity for corporate income tax (
CIT
) purposes with
Arcona Black Sea Real Estate B.V., Arcona Real Estate B.V. and Arcona Poland B.V. On this basis,
the Parent Company is jointly and severally liable for the corporate income tax liability of the fiscal
unity as a whole.
B.
The Parent Company has a contingent liability to issue ordinary shares arising from the outstanding
warrants. For further information reference is made to section 15.23 “Contingent liabilities”.
As at balance sheet date the Parent Company was not subject to any other contingent liabilities, including any
obligations that result from security transactions related to (exchange) rate risk in connection with investments.
19.19
INCOME FROM INVESTMENTS
The income from investments concerns the interest from receivables from group companies. The specification
is as follows:
2025
2024
In € 1,000
In € 1,000
Arcona Poland Project 5 Sp. z o.o.
584
529
Arcona Capital Real Estate Poland Sp. z o.o.
552
515
Arcona Black Sea Real Estate B.V.
489
367
Arcona Capital Real Estate Trio Sp. z o.o.
1
51
Arcona Capital RE Bohemia s.r.o.
-
163
Aisi Bela LLC
8
7
Subtotal
1,634
1,632
Adjustment prior years Arcona Capital Real Estate Trio Sp. z o.o.
-
232
1,634
1,864
19.20
REALISED VALUATION RESULTS OF INVESTMENTS IN GROUP COMPANIES
2025
2024
In € 1,000
In € 1,000
Realised currency results Arcona Capital RE Slovakia s.r.o.
-
451
Realised currency results Arcona Capital RE Bohemia s.r.o.
259
129
Result on disposal of Boyana Residence E.O.O.D.
-
677
259
1,257
The “Realised currency results Arcona Capital RE Bohemia s.r.o.” for the amount of € 259,000 relates to
realised currency results as a result of dividend distributions Arcona Capital RE Bohemia s.r.o. for the amount
of € 1,634,000.
185
19.20.1
Specification of result on disposal of Boyana Residence E.O.O.D.
2025
2024
In € 1,000
In € 1,000
Selling price
-
1,590
Less: carrying amount of sold group company
-
807
-
783
Sales fee
-
32
Sales performance-related fee
-
74
Transaction costs on sale of group companies
-
-
Subtotal costs on sale group companies
-
106
-
677
19.21
REALISED VALUATION RESULTS OF RECEIVABLES FROM GROUP COMPANIES
2025
2024
In € 1,000
In € 1,000
Realised currency results Arcona Capital RE Bohemia s.r.o.
-
58
19.22
UNREALISED VALUATION RESULTS OF INVESTMENTS IN GROUP COMPANIES
The unrealised valuation results of investments in group companies contain the share in the results from
investments in group companies as well as changes in provisions investments in group companies. The
specification is as follows:
2025
2024
In € 1,000
In € 1,000
Arcona Capital RE Bohemia s.r.o.
299
532
Arcona Capital RE Slovakia s.r.o.
-/- 3,188
-/- 524
Arcona Capital Real Estate Poland Sp. z o.o.
-/- 117
215
Arcona Capital Real Estate Trio Sp. z o.o.
-/- 559
-/- 311
Arcona Real Estate B.V.
27
23
Aisi Bela LLC
-/- 96
335
Boyana Residence E.O.O.D.
N.a.
-/- 1,212
Arcona Black Sea Real Estate B.V.
316
-/- 218
-/- 3,318
-/- 1,160
186
19.23
UNREALISED VALUATION RESULTS OF RECEIVABLES FROM GROUP COMPANIES
The unrealised valuation results of receivables from group companies contain the provision loan to group
companies, in case the carrying amount of the corresponding investment in group company is negative and
the Parent Company has provided a loan to the corresponding group company. The specification is as follows:
2025
2024
In € 1,000
In € 1,000
Boyana Residence E.O.O.D.
N.a.
1,318
Arcona Black Sea Real Estate B.V.
-/- 577
-/- 749
Arcona Poland Project 5 Sp. z o.o.
-/- 604
-/- 631
-/- 1,181
-/- 62
19.24
OTHER OPERATING INCOME
2025
2024
In € 1,000
In € 1,000
Foreign exchange and currency gains
26
15
Other operating income
-
2
26
17
19.25
ADMINISTRATIVE EXPENSES
19.25.1
Specification of administrative expenses
2025
2024
In € 1,000
In € 1,000
Fund Management fee
678
675
Sales performance-related fee
305
95
Sales fee
-
5
983
775
19.26
OTHER OPERATING EXPENSES
19.26.1
Specification of other operating expenses
2025
2024
In € 1,000
In € 1,000
Costs of service providers
509
468
Costs of funding and acquisition
17
182
526
650
187
19.26.2
Analysis of costs of service providers
2025
2024
In € 1,000
In € 1,000
Audit fees
157
121
Accounting expenses
119
112
Custody fees
55
57
Consultancy fees
36
-/- 4
Steering Committee fees
25
47
Supervisors’ expenses
29
22
Supervisory Board fees
23
28
Insurance AIFMD
22
22
Listing, Paying and Fund Agent fees
14
12
Marketing expenses
11
7
Other costs of service providers
18
44
509
468
19.26.3 Audit fees
The “Audit fees” for the amount of € 157,000 include the fees for the audit of the Consolidated Financial
Statements and Parent Company Statements and European Single Electronic Format (
ESEF
) reporting 2025,
as well as an amount of € 25,000 (2024: € 27,000) for the audit of the figures of the Ukrainian and Romanian
subsidiaries. During the financial period audit fees for prior years have been booked in an amount of € nil
(2024: € 1,000 negative).
19.26.4
Analysis of Supervisory Board fees
For the analysis of the Supervisory Board fees reference is made to section 15.35.3 “Analysis of Supervisory
Board fees”.
19.26.5
Analysis of costs of funding and acquisition
For the analysis of the cost of funding and acquisition reference is made to section 15.35.5 “Analysis of costs
of funding and acquisitions”.
19.26.6 Supervisors’ expenses
The “Supervisors’ expenses” include expenses for supervision by the AFM and DNB.
19.26.7
Other costs of service providers
The “Other costs of service providers” include, among others, costs of press releases, required software
European Single Electronic Format (
ESEF
), Euronext Fund Services and Prague Stock Exchange.
19.26.8
Costs of funding and acquisitions
The “Costs of funding and acquisitions” include costs of technical, legal and tax due diligence for (potential)
acquisitions.
19.27
PERSONNEL COSTS
The Parent Company does not employ any personnel (2024: nil).
188
19.28
INTEREST EXPENSES
2025
2024
In € 1,000
In € 1,000
Interest expense on loans due to group companies
74
175
Interest expenses on private loans
181
349
Variable compensation on private loans
-
29
255
553
19.28.1
Specification of interest expense on loans due to group companies
2025
2024
In € 1,000
In € 1,000
Arcona Capital RE Slovakia s.r.o.
33
66
Arcona Capital Real Estate Trio Sp. z o.o.
-
67
Arcona Real Estate B.V.
41
40
Arcona Capital RE Bohemia s.r.o.
-
2
74
175
19.29
INCOME TAX EXPENSE
The results of the Parent Company are subject to corporate income tax (
CIT
).
19.29.1
Income tax expense recognised in the Parent Company profit and loss account
2025
2024
In € 1,000
In € 1,000
Current income tax expense
Current year
-
-
Adjustments related to prior years
-
-
-
-
Deferred income tax expense
Origination and reversal of taxable temporary differences
-
2
Recognition of previously unrecognised (derecognition of previously
recognised) tax losses
1
26
Recognition of previously unrecognised (derecognition of previously
recognised) other taxable temporary differences
-
-
Change in tax rate
-
-
Adjustments related to prior years
-
-
1
28
Total
1
28
19.29.2
Deferred income tax recognised directly in shareholders’ equity
2025
2024
In € 1,000
In € 1,000
Related to receivables from group companies
-/- 1
-/- 28
189
19.30
RELATED PARTIES
For the definition of related parties’ reference is made to section 15.44 “Related parties”.
In addition to section 15.44 “Related parties” the Parent Company entered into or maintained the following
transactions with group companies, part of other related parties:
A.
dividends received from group companies, as described in section 19.1.2 “Statement of changes in
investments in group companies”;
B.
loans advanced and redemption on loans to group companies, as described in section 19.2.3
“Statement of changes in loans to group companies”;
C.
loans advanced and redemption on loans due to group companies, as described in section 19.13.5
“Statement of changes in loans due to group companies”;
D.
the Parent Company has paid several costs for N-E Real Estate Park First Phase S.r.l. for an amount
of € 102,000, as described in section 19.3.4 “Specification of current account to group companies”.
19.31
PROPOSAL FOR THE PARENT COMPANY RESULT APPROPRIATION
The Parent Company´s result for the financial period amounts to € 4,345,000 negative. Recognising the
mandatory:
•
net deduction of € 2,967,000 from the legal revaluation reserve; and
•
net deduction of € 1,141,000 from the legal reserve investments in group companies;
the remaining loss for the financial period was € 237,000. It is proposed to the General Meeting of Shareholders
(
GM
) to deduct the whole of the remaining loss for the financial period from the retained earnings.
This proposal has already been recognised in the Parent Company balance sheet.
19.32
DETERMINING OF PARENT COMPANY RESULT FOR THE PREVIOUS FINANCIAL PERIOD
During the General Meeting of Shareholders (
GM
) of the Parent Company as at June 25, 2025, the GM
approved the result appropriation proposal of the Managing Board as stated in the Annual Report of the
previous year.
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19.33
EVENTS AFTER BALANCE SHEET DATE
The following material events have occurred after balance sheet date:
A.
As at March 23, 2026, the Hypo NOE loan was successfully refinanced. Subsequent to the reporting
period, the Fund successfully refinanced the secured bank loan with Hypo NOE, which had been
classified as a current liability as at the Statement of Financial Position date due to its contractual
maturity on March 31, 2026. In March 2026, the Fund reached agreement with HYPO NOE on the
refinancing of this facility, resulting in a new loan with a long-term maturity term of five years extending
to March 2031. This refinancing strengthens the Fund’s financing structure, improves the maturity
profile of the Group’s debt, and provides increased long-term stability to the Fund’s capital structure.
B.
In April 2026, the Patria Bank loan was fully repaid and settled. Subsequent to the reporting period,
the Fund fully repaid and settled the secured bank loan facility with Patria Bank. The loan had been
classified as a current liability as at the Statement of Financial Position date following a breach of the
bank covenants at that date, mainly resulting from the EOS Business Park (Romania) becoming fully
vacant during 2025. Following the full repayment of the Patria Bank facility, the outstanding exposure
under this financing has been eliminated and the related liability no longer forms part of the Group’s
financing structure. The settlement of the loan reduces the Fund’s overall bank financing exposure
and improves the Group’s leverage position.
No further material events have occurred after balance sheet date.
Amsterdam, April 30, 2026
The Managing Board:
Arcona Capital Fund Management B.V.
On behalf of,
G.St.J. Barker LLB
P.H.J. Mars M.Sc
M. Van der Laan B.Sc
M.T.H. Blokland BBA
Managing director
Managing director
Managing director
Managing director
The Supervisory Board:
A.N. Krol
E.J.C.G. Korteweg
E. van Erkelens
Chairperson
Member
Member
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20
OTHER
INFORMATION
20.1
GENERAL PROVISIONS OF THE ARTICLES OF ASSOCIATION CONCERNING RESULT
APPROPRIATION
In accordance with Article 28 of the Articles of Association dated September 21, 2016, profits are determined
and distributed as follows:
28.1
From the profit earned in a financial period as far as possible a dividend is first distributed on the
priority share, the amount of which dividend is equal to seven per cent (7%) on an annual basis,
calculated on the nominal value of the priority share. No further distributions are made on the priority
share.
28.2
The priority shareholder determines annually what part of the profit remaining after application of
article 28.1 above is added to the reserves.
28.3
It is the prerogative of the general meeting of shareholders to allocate the profit remaining after
application of articles 28.1 and 28.2 above.
28.4
Distribution of profit occurs after adoption of the Financial Statements evidencing that this is
permitted.
28.5
The priority shareholder may resolve to make interim distributions on ordinary shares and / or
distributions on ordinary shares charged to a Parent Company reserve.
28.6
Distributions on shares may only take place up to a maximum of the amount of the distributable
shareholders’ equity.
28.7
Unless the body that decides on distribution determines another time, distributions on shares are
payable immediately after declaration.
28.8
In calculating the amount of any distribution on shares the shares held by the Parent Company in
its own capital are not included.
20.2
DECREE ON THE DUTCH ACT ON FINANCIAL SUPERVISION
Arcona Capital Fund Management B.V. has a permit from the AFM under the Dutch Act on Financial
Supervision (Wet op het financieel toezicht, the
Wft
) to act as the management company of the Parent
Company.
20.3
PERSONAL INTERESTS
During the financial period, neither the Managing Board nor the Supervisory Board held interests in
investments of the Parent Company, except for former Supervisory Board members who served until June 26,
2025:
•
Mr. J.J. van Heijst (former member of the Supervisory Board until June 26, 2025) holds 12,855 ordinary
shares (December 31, 2024: 12,855 shares) in a private capacity. Mr. J.J. van Heijst M.Sc. is employed
by Stichting Value Partners Family Office, which holds 376,787 ordinary shares (December 31, 2024:
376,787 shares);
•
Mr. M.P. Beys (former member of the Supervisory Board until June 26, 2025) holds no ordinary shares
(December 31, 2024: none) in a private capacity. Mr. M.P. Beys is also Chairman of the Board of
Directors of SPDI, which holds 1,072,910 ordinary shares and 79,471 registered shares (December
31, 2024: 1,072,910 ordinary shares).
192
20.4
SPECIAL CONTROLLING RIGHTS
Special rights in respect of control of the Parent Company have been granted to the holders of priority shares.
The priority shares are bearer shares. As provided by the Articles of Association the priority shares entitle the
Foundation:
•
to determine the number of members of the Managing Board and Supervisory Board;
•
to make binding nominations for appointment of the members of the Managing Board and the
members of the Supervisory Board;
•
to make the proposal to the General Meeting of Shareholders to suspend or dismiss a Managing
Board member and / or a Supervisory Board member;
•
to make the proposal to the Supervisory Board for the remuneration of the members of the
Supervisory Board;
•
to determine which part of the profits remaining after priority dividend (reference is made to section
20.1) shall be reserved;
•
to make interim distributions on ordinary shares and / or distributions on ordinary shares charged to
a Parent Company reserve;
•
to make the proposal to the General Meeting of Shareholders to amend the Articles of Association of
the Parent Company;
•
to make the proposal to the General Meeting of Shareholders for statutory merger or statutory
demerger of the Parent Company;
•
to make the proposal to the General Meeting of Shareholders for dissolution of the Parent Company.
The General Meeting of Shareholders needs the approval of the Foundation for decisions of the Managing
Board concerning the reduction of the issued share capital.
193
20.5
INDEPENDENT AUDITOR’S REPORT
Deloitte Accountants B.V.
Gustav Mahlerlaan 2970
1081 LA Amsterdam
P.O. Box 58110
1040 HC Amsterdam
The Netherlands
Tel: +31 (0)88 288 2888
www.deloitte.nl
INDEPENDENT AUDITOR'S REPORT
To: the shareholders and the Supervisory Board of Arcona Property Fund N.V.
Report on the audit of the financial statements 2025 included in the annual report
Our opinion
We have audited the financial statements 2025 of Arcona Property Fund N.V., based in Amsterdam. The financial
statements comprise the consolidated and company financial statements.
In our opinion:
•
The accompanying consolidated financial statements give a true and fair view of the financial position of
Arcona Property Fund N.V. as at 31 December 2025, and of its result and its cash flows for 2025 in accordance
with International Financial Reporting Standards as adopted by the European Union (EU-IFRS) and with Part 9
of Book 2 of the Dutch Civil Code.
•
The accompanying company financial statements give a true and fair view of the financial position of Arcona
Property Fund N.V. as at 31 December 2025, and of its result for 2025 in accordance with Part 9 of Book 2 of
the Dutch Civil Code.
The consolidated financial statements comprise:
1.
The consolidated statement of financial position as at 31 December 2025
.
2.
The following statements for 2025: the consolidated income statement, the consolidated statements of
comprehensive income, changes in equity and cash flows.
3.
The notes comprising material accounting policy information and other explanatory information.
The company financial statements comprise:
1.
The parent company balance sheet as at 31 December 2025.
2.
The parent company
profit and loss account for 2025.
3.
The notes comprising a summary of the accounting policies and other explanatory information.
Basis for our opinion
We conducted our audit in accordance with Dutch law, including the Dutch Standards on Auditing. Our
responsibilities under those standards are further described in the ‘Our responsibilities for the audit of the
financial statements’ section of our report.
194
We are independent of Arcona Property Fund N.V. in accordance with the EU Regulation on specific requirements
regarding statutory audit of public-interest entities, the ‘Wet toezicht accountantsorganisaties’ (Wta, Audit firms
supervision act), the ‘Verordening inzake de onafhankelijkheid van accountants bij assurance-opdrachten’ (ViO,
Code of Ethics for Professional Accountants, a regulation with respect to independence) and other relevant
independence regulations in the Netherlands. Furthermore, we have complied with the Verordening gedrags- en
beroepsregels accountants (VGBA, Dutch Code of Ethics for Professional Accountants).
We believe the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Information in support of our opinion
We designed our audit procedures in the context of our audit of the financial statements as a whole and in forming
our opinion thereon. The following information in support of our opinion was addressed in this context, and we do
not provide a separate opinion or conclusion on these matters.
Materiality
Based on our professional judgment we determined the materiality for the financial statements as a whole at
EUR 600,000. The materiality is based on 1% of total assets. We have also taken into account misstatements and/or
possible misstatements that in our opinion are material for the users of the financial statements for qualitative
reasons.
We agreed with Supervisory Board that misstatements in excess of EUR 30,000, which are identified during the
audit, would be reported to them, as well as smaller misstatements that in our view must be reported on qualitative
grounds.
Scope of the group audit
Arcona Property Fund N.V. is at the head of a group of components. The financial information of this group is
included in the financial statements of Arcona Property Fund N.V.
Based on our risk assessment, we determined the nature, timing and extent of audit procedures to be performed,
including determining the components at which to perform audit procedures.
In establishing the overall group audit strategy and plan, we determined the type of work that needed to be
performed at the components by the group engagement team and by component auditors from other Deloitte
Network firms. Where the work was performed by component auditors, we determined the level of involvement
we needed to have in the audit work at these components so as to be able to conclude whether sufficient
appropriate audit evidence had been obtained as a basis for our opinion on the group financial statements as a
whole.
For each component we determined whether we required an audit of their complete financial information or
whether other procedures would be sufficient.
We have used the work of component auditor Deloitte Czech Republic when auditing entities in Czech Republic
and Slovakia. We have used the work of component auditor Deloitte Poland when auditing entities in Poland. We
have prepared group referral instructions for the component auditor and performed a file review at the
component auditor. On the level of Romania we performed risk assessment procedures and audit procedures on
specific accounts.
195
The group engagement team directed the planning, reviewed the work performed by component auditors and
assessed and discussed the results and findings with the component auditors.
The group engagement team held multiple meetings, with all the individual component auditors, and management
of the relevant group entities, and participated in the component auditor closing calls. For all component auditors,
file reviews were conducted to evaluate the work undertaken and to assess their findings.
The group consolidation, financial statements and disclosures are audited directly by the group engagement team
in addition to the other procedures where the group engagement team is responsible for.
By performing the procedures mentioned above at components, together with additional procedures at group
level, we have been able to obtain sufficient and appropriate audit evidence about the group's financial
information to provide an opinion on the financial statements.
Audit approach fraud risks
We identified and assessed the risks of material misstatements of the financial statements due to fraud. During
our audit we obtained an understanding of the company and its environment and the components of the system
of internal control, including the risk assessment process and management's process for responding to the risks of
fraud and monitoring the system of internal control and how the Supervisory Board exercises oversight, as well as
the outcomes.
We evaluated the design and relevant aspects of the system of internal control and in particular the fraud risk
assessment, as well as among others the code of conduct, whistle blower procedures and incident registration. We
evaluated the design and the implementation and, where considered appropriate, tested the operating
effectiveness, of internal controls designed to mitigate fraud risks.
As part of our process of identifying fraud risks, we evaluated fraud risk factors with respect to financial reporting
fraud, misappropriation of assets and bribery and corruption in close co-operation with our forensic specialists. We
evaluated whether these factors indicate that a risk of material misstatement due to fraud is present.
We identified the following fraud risks and performed the following specific procedures:
Fraud risk
Audit approach
Management override of controls
We presume a risk of material misstatement due to
fraud related to management override of controls. The
Management Board is in a unique position to
perpetrate fraud because of the Management Board’s
ability to manipulate accounting records and prepare
fraudulent financial statements by overriding controls
that otherwise appear to be operating effectively.
We have, among other things, performed the
following procedures:
We incorporated elements of unpredictability in our
audit. We also considered the outcome of our other
audit procedures and evaluated whether any findings
were indicative of fraud or non-compliance.
We tested the appropriateness of journal entries
recorded in the general ledger and other adjustments
made in the preparation of the financial statements.
We considered available information and made
inquiries of relevant personnel of Arcona Property
Fund N.V. We evaluated the design and the
implementation of internal controls designed to
mitigate fraud risks.
We evaluated whether the selection and application
of accounting policies by Arcona Property Fund N.V.,
particularly those related to subjective measurements
and complex transactions, may be indicative of
fraudulent financial reporting. For significant
196
transactions we have evaluated whether the business
rationale of the transactions suggests that they may
have been entered into to engage in fraudulent
financial reporting or to conceal misappropriation of
assets.
As part of our audit procedures, we verified whether
the significant transactions should be considered
related party transactions.
We evaluated whether the judgments and decisions
made by the Management Board in making the
accounting estimates included in the financial
statements indicate a possible bias that may represent
a risk of material misstatement due to fraud. The
Management Board insights, estimates and
assumptions that might have a major impact on the
financial statements are disclosed in Note 13.5.2 of
the financial statements. We performed a
retrospective review of the Management Board
judgments and assumptions related to significant
accounting estimates reflected in prior year financial
statements. Reference is made “Valuation of
investment property” below as well.
Valuation of investment property
In relation to valuation of investment properties a
potential fraud risk is identified to revaluations and
other deviations from the normal valuation process.
The Management Board’s adjustment of external
valuations, optimistic estimation of gross initial yield
and market rent.
Valuation of investment property is a significant area
to our audit as the valuation is inherently judgmental
in nature, due to the use of assumptions that are
highly sensitive, any change in assumptions may have
a significant effect on the outcome given the relative
size of the investment property balance.
The Management Board insights, estimates and
assumptions related to valuation of investment
property have a major impact on the financial
statements and are disclosed in Note 13.5.2, 13.10,
13.11 and 13.19.2 of the financial statements. Further
reference is made to the section “Our key audit
matter” for audit procedures performed.
197
Risk of incorrect recognition of disposals of
investment property
The accurate and complete recognition of these
transactions is an important area of emphasis in our
audit. We pay special attention to fraud risks
associated with selling properties, such as ABC
transactions.
In 2025, Arcona Property Fund N.V. sold multiple
properties. We have tested the design and controls
related to property investment sales, which includes
ensuring proper authorisation and conducting
background checks of buyers.
We carried out procedures on the disposals of
investment property. We have reconciled the
recognised transactions with the relevant supporting
documentation and confirmed the accurate and
complete recognition of transactions results in the
fiscal year. Furthermore, we have carried out
procedures to identify and test ABC transactions.
In addition, we have analysed the sales price of
property transactions in relation to the most recent
valuation as determined by the external appraiser. If
applicable, we have assessed the reasonableness of
considerations paid to intermediaries.
Accounting on rental income including lease
incentives
We presume a risk of material misstatement due to
fraud related to revenue recognition and evaluate
which types of revenue, revenue transactions or
assertions give rise to such risks.
We pinpoint the significant risk to the occurrence of
rental income (specific to new rental agreements) and
the accuracy of the accounting for lease
incentives/discounts provided, in accordance with the
applicable financial reporting standards.
During our audit of rental income, we tested the
design, implementation, and operating effectiveness
of the relevant internal controls, carried out
comparative testing procedures to assess the
reliability of the rent roll data, developed an
independent expectation of total revenue and
compared it to the actual amounts recorded, reviewed
new lease agreements to ensure revenue was
accurately captured in line with the underlying
contracts, and tested the recognition of newly granted
lease incentives.
In addition, we performed ongoing substantive
analytical procedures to verify the straight-lining of
those incentives.
Our audit procedures did not lead to indications for fraud potentially resulting in material misstatements.
Audit approach compliance with laws and regulations
We assessed the laws and regulations relevant to the company through discussion with the Managing Board, the
Supervisory Board and other personnel and reading minutes. We have involved our forensic specialists in this
evaluation.
As a result of our risk assessment procedures, and while realizing that the effects from non-compliance could
considerably vary, we considered the following laws and regulations: (corporate) tax law, the requirements under
the International Financial Reporting Standards as adopted by the European Union (EU-IFRS) and Part 9 of Book 2
of the Dutch Civil Code with a direct effect on the financial statements as an integrated part of our audit
procedures, to the extent material for the financial statements.
We obtained sufficient appropriate audit evidence regarding provisions of those laws and regulations generally
recognized to have a direct effect on the financial statements.
198
Apart from these, the entity is subject to other laws and regulations where the consequences of non-compliance
could have a material effect on amounts and/or disclosures in the financial statements, for instance, through
imposing fines or litigation.
Given the nature of the entity's business and the complexity of these other laws and regulations, there is a risk of
non-compliance with the requirements of such laws and regulations. In addition, we considered major laws and
regulations applicable to listed companies.
Our procedures are more limited with respect to these laws and regulations that do not have a direct effect on the
determination of the amounts and disclosures in the financial statements.
Compliance with these laws and regulations may be fundamental to the operating aspects of the business, to the
entity's ability to continue its business, or to avoid material penalties (e.g., compliance with the terms of operating
licenses and permits or compliance with environmental regulations) and therefore non-compliance with such laws
and regulations may have a material effect on the financial statements. Our responsibility is limited to undertaking
specified audit procedures to help identify non-compliance with those laws and regulations that may have a
material effect on the financial statements. Our procedures are limited to (i) inquiry of management, the
Supervisory Board and others within the entity as to whether the entity is in compliance with such laws and
regulations and (ii) inspecting correspondence, if any, with the relevant licensing or regulatory authorities to help
identify non-compliance with those laws and regulations that may have a material effect on the financial
statements.
Naturally, we remained alert to indications of (suspected) non-compliance throughout the audit.
Finally, we obtained written representations that all known instances of (suspected) fraud or non-compliance with
laws and regulations have been disclosed to us.
Audit approach going concern
Management made a specific assessment of the company’s ability to continue as a going concern and to continue
its operations for at least the next 12 months. We discussed and evaluated the assessment with management
exercising professional judgment and maintaining professional skepticism. We considered whether management’s
going concern assessment, based on our knowledge and understanding obtained through our audit of the financial
statements or otherwise, contains all events or conditions that may cast significant doubt on the company’s ability
to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw
attention in our auditor’s report to the related disclosures in the financial statements or, if such disclosures are
inadequate, to modify our opinion. Based on our procedures performed, we did not identify serious doubts on
Arcona Property Fund N.V.’s ability to continue as a going concern for the next 12 months. Our conclusions are
based on the audit evidence obtained up to the date of our independent auditor’s report. However, future events
or conditions may cause a company to cease to continue as a going concern.
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Our key audit matters
Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of
the financial statements. We have communicated the key audit matters to Supervisory Board. The key audit
matters are not a comprehensive reflection of all matters discussed.
These matters were addressed in the context of our audit of the financial statements as a whole and in forming
our opinion thereon, and we do not provide a separate opinion on these matters.
Key audit matter
How the key audit matter was addressed in the audit
As at December 31, 2025 the company held a portfolio
of investment property (under development) including
assets held for sale with a fair value of € 47.4 million
(December 31, 2024: € 65.6 million) and investment in
associates (with investment property within the
associate) for € 3.5 million (December 31, 2024: € 3.4
million).
At the end of each reporting period, the Management
Board determines the fair value of its investment
property portfolio in accordance with the
requirements of IAS 40 and IFRS 13.
Arcona Property Fund N.V. uses external valuation
reports issued by external independent professionally
qualified valuers to determine the fair value of its
investment property.
As the valuation of investment property is inherently
judgmental in nature, due to the use of assumptions
that are highly sensitive, any change in assumptions
may have a significant effect on the outcome given
the relative size of the investment property balance.
The most significant assumptions and parameters
involved, given the sensitivity and impact on the
outcome, are the gross initial yield, and market rent
levels.
IFRS 13 seeks to increase consistency and
comparability in fair value measurements and related
disclosures through a 'fair value hierarchy'. The
hierarchy categorises the inputs used in valuation
techniques into three levels. The hierarchy gives the
highest priority to (unadjusted) quoted prices in active
markets for identical assets or liabilities and the
lowest priority to unobservable inputs. (Unobservable)
inputs are used to measure fair value to the extent
that relevant observable inputs are not available,
thereby allowing for situations in which there is little,
if any, market activity for the asset at the
measurement date. Fair value measurements
categorised within Level 3 have the lowest priority as
the valuation is predominately based on unobservable
inputs and those measurements have a greater degree
of uncertainty and subjectivity. This means that a
valuation at Level 3 has a fairly large measure of
How the key audit matter was addressed in the audit:
Our audit procedures included, among others, the
following:
We have
gained understanding of the valuation
process and tested the design and implementation of
Arcona Property Fund N.V.’s relevant controls with
respect to the data used in the valuation of the
investment property.
We noted that management involved established
international parties to assist with the valuation of the
investment properties. We evaluated the competence
of company’s external appraiser, which included
consideration of their qualifications and expertise.
We have further evaluated and challenged the
assumptions made in respect to the creditworthiness
of significant tenants, lease incentives and vacancy
periods in the valuation calculations.
We reconciled the fair value carrying amounts of all
investment properties to the external valuation
reports as per 31 December 2025.
In relation to the significant assumptions in the
valuation of investment property, we have:
•
Determined that the valuation methods as
applied by the Management Board, as
included in the valuation reports, are
appropriate and consistently applied.
•
For the Czech, Slovak and Polish portfolio, we
provided direction and oversight to Deloitte
Czech Republic and Deloitte Poland, and
conducted a file review of the work they
performed.
•
We have challenged the significant
assumptions used (such as gross initial yield,
market rent levels,) against relevant market
data. We have involved our internal real
estate valuation experts in these
assessments.
200
estimation uncertainty and as a result a fairly large
bandwidth of valuation uncertainty in which a
valuation can been seen reasonable in the light of IFRS
13.
In addition, and as the external appraiser has
recommended in its assessment of the fair value of
the property portfolio, caution is needed in analysing
the values due to the unknown future impacts on
economy and real estate markets.
•
We have reviewed other relevant
assumptions included in the cash flow
forecasts of the valuation reports for the
investment property and discussed with
client. Among other things the discounts
forecasted, CAPEX program, vacancy
allowances/loss of rent and credit loss.
•
We assessed the sensitivity analysis on the
key input data and assumptions to
understand the impact of reasonable changes
in assumptions on the valuation and other
key performance indicators.
•
We have assessed the appropriateness of the
disclosures relating to the assumptions used
in the valuations and sensitivity analysis in
the notes to the consolidated Financial
Statements.
•
We assessed the asset’s “held for sale”
classification against the requirements of IFRS
5.
Observation:
We found that, with the (significant) assumptions used
in the valuation reports, the valuation of the
investment property is valued within a reasonable
range in the light of the valuation uncertainty for level
3 valuations.
201
Report on the other information included in the annual report
The annual report contains other information, in addition to the financial statements and our auditor's report
thereon.
The other information consists of:
•
Foreword from the Managing Board
•
Arcona Property Fund in brief
•
Report of the Supervisory Board
•
Report of the Managing Board
•
The Real Estate Portfolio
•
Performance Indicators
•
Other information as required by Part 9 of Book 2 of the Dutch Civil Code.
Based on the following procedures performed, we conclude that the other information:
•
Is consistent with the financial statements and does not contain material misstatements.
•
Contains all the information regarding the management report and the other information as required by Part
9 of Book 2 of the Dutch Civil Code.
We have read the other information. Based on our knowledge and understanding obtained through our audit of
the financial statements or otherwise, we have considered whether the other information contains material
misstatements.
By performing these procedures, we comply with the requirements of Part 9 of Book 2 of the Dutch Civil Code and
the Dutch Standard 720. The scope of the procedures performed is substantially less than the scope of those
performed in our audit of the financial statements.
Management is responsible for the preparation of the other information, including the management report in
accordance with Part 9 of Book 2 of the Dutch Civil Code, and the other information as required by Part 9 of Book 2
of the Dutch Civil Code.
Report on other legal and regulatory requirements and ESEF
Engagement
We were engaged by the Supervisory Board as auditor of Arcona Property Fund N.V. on 18 May 2017, as of the
audit for the year 2017 and have operated as statutory auditor ever since that financial year.
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No prohibited non-audit services
We have not provided prohibited non-audit services as referred to in Article 5(1) of the EU Regulation on specific
requirements regarding statutory audit of public-interest entities.
European Single Electronic Format (ESEF)
Arcona Property Fund N.V. has prepared its annual report in ESEF. The requirements for this are set out in the
Delegated Regulation (EU) 2019/815 with regard to regulatory technical standards on the specification of a single
electronic reporting format (hereinafter: the RTS on ESEF).
In our opinion, the annual report, prepared in XHTML format, including the (partly) marked-up consolidated
financial statements, as included in the reporting package by Arcona Property Fund N.V. complies in all material
respects with the RTS on ESEF.
Management is responsible for preparing the annual report including the financial statements in accordance with
the RTS on ESEF, whereby management combines the various components into one single reporting package.
Our responsibility is to obtain reasonable assurance for our opinion whether the annual report in this reporting
package complies with the RTS on ESEF.
We performed our examination in accordance with Dutch law, including Dutch Standard 3950N ‘Assurance-
opdrachten inzake het voldoen aan de criteria voor het opstellen van een digitaal verantwoordingsdocument’
(assurance engagements relating to compliance with criteria for digital reporting).
Our examination included amongst others:
•
Obtaining an understanding of the company's financial reporting process, including the preparation of the
reporting package.
•
Identifying and assessing the risks that the annual report does not comply in all material respects with the RTS
on ESEF and designing and performing further assurance procedures responsive to those risks to provide a
basis for our opinion, including:
o
obtaining the reporting package and performing validations to determine whether the reporting package
containing the Inline XBRL instance and the XBRL extension taxonomy files has been prepared in
accordance with the technical specifications as included in the RTS on ESEF;
o
examining the information related to the consolidated financial statements in the reporting package to
determine whether all required mark-ups have been applied and whether these are in accordance with
the RTS on ESEF.
Description of responsibilities regarding the financial statements
Responsibilities of Managing Board and the Supervisory Board for the financial statements
Management is responsible for the preparation and fair presentation of the financial statements in accordance
with EU-IFRS and Part 9 of Book 2 of the Dutch Civil Code. Furthermore, management is responsible for such
internal control as management determines is necessary to enable the preparation of the financial statements that
are free from material misstatement, whether due to fraud or error.
203
As part of the preparation of the financial statements, management is responsible for assessing the company's
ability to continue as a going concern. Based on the financial reporting frameworks mentioned, management
should prepare the financial statements using the going concern basis of accounting unless management either
intends to liquidate the company or to cease operations, or has no realistic alternative but to do so.
Managing Board should disclose events and circumstances that may cast significant doubt on the company's ability
to continue as a going concern in the financial statements.
The Supervisory Board is responsible for overseeing the company's financial reporting process.
Our responsibilities for the audit of the financial statements
Our responsibility is to plan and perform the audit engagement in a manner that allows us to obtain sufficient
appropriate audit evidence for our opinion.
Our audit has been performed with a high, but not absolute, level of assurance, which means we may not detect
all material misstatements, whether due to fraud or error, during our audit.
Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they
could reasonably be expected to influence the economic decisions of users taken on the basis of these financial
statements. The materiality affects the nature, timing and extent of our audit procedures and the evaluation of the
effect of identified misstatements on our opinion.
We have exercised professional judgment and have maintained professional scepticism throughout the audit, in
accordance with Dutch Standards on Auditing, ethical requirements and independence requirements. Our audit
included among others:
•
Identifying and assessing the risks of material misstatement of the financial statements, whether due to fraud
or error, designing and performing audit procedures responsive to those risks, and obtaining audit evidence
that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material
misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion,
forgery, intentional omissions, misrepresentations, or the override of internal control.
•
Obtaining an understanding of internal control relevant to the audit in order to design audit procedures that
are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of
the company's internal control.
•
Evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates
and related disclosures made by management.
•
Concluding on the appropriateness of
management's use of the going concern basis of accounting, and based
on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may
cast significant doubt on the company's ability to continue as a going concern. If we conclude that a material
uncertainty exists, we are required to draw attention in our auditor's report to the related disclosures in the
financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based
on the audit evidence obtained up to the date of our auditor's report. However, future events or conditions
may cause the company to cease to continue as a going concern.
•
Evaluating the overall presentation, structure and content of the financial statements, including the
disclosures.
204
•
Evaluating whether the financial statements represent the underlying transactions and events in a manner
that achieves fair presentation.
We are responsible for planning and performing the group audit to obtain sufficient appropriate audit evidence
regarding the financial information of the entities or business units within the group as a basis for forming an
opinion on the financial statements. We are also responsible for the direction, supervision and review of the audit
work performed for purposes of the group audit. We bear the full responsibility for the auditor’s report.
We communicate with the Supervisory Board regarding, among other matters, the planned scope and timing of the
audit and significant audit findings, including any significant findings in internal control that we identified during
our audit. In this respect we also submit an additional report to the audit committee in accordance with Article 11
of the EU Regulation on specific requirements regarding statutory audit of public-interest entities. The information
included in this additional report is consistent with our audit opinion in this auditor's report.
We provide Supervisory Board with a statement that we have complied with relevant ethical requirements
regarding independence, and to communicate with them all relationships and other matters that may reasonably
be thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with the Supervisory Board, we determine the key audit matters: those matters
that were of most significance in the audit of the financial statements. We describe these matters in our auditor’s
report unless law or regulation precludes public disclosure about the matter or when, in extremely rare
circumstances, not communicating the matter is in the public interest.
Amsterdam, 30 April 2026
2026-04-21 2026-04-21 21.04.2026Goedkeurend
Controle Financial Statements KVK 24362853
Deloitte Accountants B.V.
Signed on the original: V.S. Borreman
