IRES warns on bad debt and vacancy level rises
Irish Residential REIT recorded a €10.8m (£9.7m) loss for the first half of 2020 as it warned that Covid-19 could lead to increases in bad debt and vacancy levels across its properties.
IRES incurred a rent vacancy loss of €1.3m, while its bad debt increased from €2,000 in 2019 to €600,000 for the first half of 2020.
IRES also saw the value of its portfolio nudge down by €27.2m (1.95%) to €1.36bn due to a lower rental income in the short term being forecast and vacancy and bad debt due to the Covid-19 pandemic, as well as decreases in developmental land values and commercial elements of the portfolio.
Irish Residential REIT recorded a €10.8m (£9.7m) loss for the first half of 2020 as it warned that Covid-19 could lead to increases in bad debt and vacancy levels across its properties.
IRES incurred a rent vacancy loss of €1.3m, while its bad debt increased from €2,000 in 2019 to €600,000 for the first half of 2020.
IRES also saw the value of its portfolio nudge down by €27.2m (1.95%) to €1.36bn due to a lower rental income in the short term being forecast and vacancy and bad debt due to the Covid-19 pandemic, as well as decreases in developmental land values and commercial elements of the portfolio.
The firm’s net asset value also fell to €784.5m from €810.2m at the end of December, while basic NAV per share slipped to 150.4c from 155.3c. LTV stood at 42.9%.
However, net rental income increased by 30.4% to €29.6m, while operating revenue rose by 34.5% to €37.4m.
Occupancy across IRES’s 3,739 apartments and houses stood at 98.9% and monthly rent collections also remained resilient at 98.4%.
Chairman Declan Moylan said: “The evolving situation presented by the Covid-19 pandemic, and government restrictions introduced in order to mitigate its spread, could have impacts on the company’s business which we cannot foresee at this time.”
“However, we are confident that the quality of our property portfolio and the strength of our balance sheet provides great resilience during this period.”
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