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Financial statements

13 Investment property under construction

  

2018

 

2017

At the beginning of the year

 

463,040

 

353,078

Investments

 

423,175

 

241,148

Transfers to investment property

 

(406,226)

 

(232,158)

Net gain (loss) from fair value adjustments on investment property under construction

78,715

 

100,972

 

In profit or loss

 

78,715

 

100,972

In other comprehensive income

 

-

 

-

Transfers out of level 3

 

-

 

-

At the end of the year

 

558,704

 

463,040

The investment property under construction relate to acquisitions and is being developed by third parties. For a list of the investment properties under construction and investment commitments, see Note 20.

The net valuation gain (loss) for the year included a positive fair value adjustment of € 106,805 (2017: € 105,220) relating to investment properties under construction that are measured at fair value at the end of the reporting period.

The investment property under construction is valued by independent external appraisers.

 

2018

2017

Investment property under construction at fair value

558,704

463,040

Investment property under construction at amortised cost

-

-

As at 31 December

558,704

463,040

The specifications of transfers from investments and the transfers to investment property are set out below.

Investments

2018

2017

Randstad

343,626

177,223

Mid East

40,620

29,647

Brabantstad

32,822

34,278

Non-core regions

6,107

-

Total investments

423,175

241,148

Transfers to investment property

2018

2017

Randstad

(341,156)

181,056

Mid East

(37,536)

14,902

Brabantstad

(27,534)

36,200

Non-core regions

-

-

Total transfers to investment property

(406,226)

232,158

The significant assumptions with regard to the valuations are set out below.

2018

    
 

Randstad

Mid East

Brabantstad

Total

Gross initial yield

4.4%

4.7%

4.6%

4.4%

Net initial yield

3.8%

3.8%

3.9%

3.8%

Long-term growth rental rate

2.5%

2.5%

2.4%

2.5%

Average 10-year inflation rate (NRVT)

0.5%

0.5%

0.5%

0.5%

Estimated average development profit on completion

12.9%

6.9%

13.5%

12.5%

Estimated average percentage of completion

48.6%

56.9%

68.7%

50.2%

Current average rent per unit (in €)

1,162

979

1,011

1,136

Construction costs (€/m²)

3,635

2,139

2,515

3,411

2017

    
 

Randstad

Mid East

Brabantstad

Total

Gross initial yield

4.4%

4.0%

4.8%

4.5%

Net initial yield

3.9%

4.0%

4.2%

3.9%

Long-term growth rental rate

2.7%

2.5%

2.2%

2.7%

Average 10-year inflation rate (NRVT)

0.5%

0.5%

0.5%

0.5%

Estimated average development profit on completion

34.7%

13.6%

3.8%

29.4%

Estimated average percentage of completion

64.4%

50.1%

44.0%

60.9%

Current average rent per unit (in €)

1,311

906

891

1,218

Construction costs (€/m²)

3,273

1,797

2,126

2,929

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