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"Additional costs in a dimension of one to two net cold rents"


The real estate giant LEG warns its tenants against horrendous additional payments for energy. Anyone who does not voluntarily increase the deductions should put money aside for the annual statement.

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Thermostat: Device connected to the account

Photo: Ole Spata / dpa

The real estate group LEG has again warned its tenants of the threat of high back payments for service charge bills next year.

"The additional costs will be in the range of one to two net cold rents," said LEG boss Lars von Lackum on Wednesday in Düsseldorf.

And this does not include the burden of the announced energy levy.

"We have to make our tenants aware of the exorbitant explosion in energy prices we are dealing with," said the manager.

Even if the tenants are willing to give up energy, there will be additional payments next year.

LEG has already written to a number of its tenants and offered to increase the advance payments on a voluntary basis in order to cushion the increase in costs over several months.

Around a third of those contacted accepted this offer.

Anyone who does not want this would do well to start putting money aside for the additional payment now.

Lackum expressed his disappointment that his proposal had not met with any response from politicians to create legal options for lowering the temperatures in apartments in winter more than previously permitted.

"We are not aware that there are any further considerations in ministries," he said.

Earlier night setback

The company is currently in the process of adjusting the heating in its properties to be as economical as possible.

The temperature curve is regulated down - within the legally permitted framework - and the night reduction is initiated a little earlier than before.

The company announced that, as in the Corona crisis, it would also help tenants who got into problems - for example by helping them apply for housing benefit, but also by offering the option of paying in installments.

No one need worry about losing their home due to the explosion in energy costs.

The most recent apartment purchases and rising rents meanwhile brought good business to LEG in the second quarter of 2022.

Operating profit from ongoing business climbed from the beginning of April to the end of June by 5.2 percent year-on-year to 120 million euros.

For the year as a whole, the board of directors around Group CEO Lars von Lackum continued to be confident of increasing the operating result to between 475 million and 490 million euros.

The stock gained around 2.8 percent in afternoon trading.

Rents have been rising for years, especially in the big cities, but many medium-sized cities are now also catching up.

The rent rose in the middle of the year on a comparable area to an average of 6.26 euros per square meter after 6.10 euros a year earlier, as the group further announced.

Excluding the price-restricted apartments, which make up around a fifth of LEG's real estate portfolio, rents increased by an average of 3.2 percent to EUR 6.65.

Modernizations and turning the price screw

Modernizations that enable landlords to turn the screw on prices also contributed to this.

Part of the costs for energy-related measures such as new windows or insulation of the facade can be passed on to the tenants.

At around EUR 125 million, LEG invested a fifth more in maintenance and modernization in the second quarter.

The vacancy rate on a like-for-like basis fell by 0.3 percentage points to 2.2 percent.

The result for the period was EUR 905.7 million in the second quarter after EUR 938.9 million in the previous year.

In view of the uncertain framework conditions, the real estate group wants to step on the brakes for the time being when it comes to acquisitions, new buildings and investments in the portfolio.

In addition, up to 5,000 apartments are to be sold.

This also included around 1,300 units from the portfolio purchased in 2021 from the competitor Adler Group, which got into troubled waters.


Source: spiegel

All business articles on 2022-08-10

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