Schönefeld, 15. December 2023: Due to the planned sale of approximately 89% of the shares in the property company holding the portfolio property located at “Stiftstrasse 18/20” in Frankfurt am Main, InCity Immobilien AG (“InCity AG”) decided to have the property in question evaluated by an external third party in a market valuation ahead of schedule in order to ensure that the sale can be transacted at market conditions. The external market valuation resulted in a non-liquidity-related extraordinary depreciation on the property amounting to approximately EUR 1.9 m. Taking further (positive) effects into consideration, the Management Board now anticipates a consolidated net loss between EUR 5.0 m and EUR 5.5 m for the InCity Group in the 2023 fiscal year (previous Group forecast: between EUR -3.8 m and EUR -4.3 m). Based on the profit transfer agreement between InCity AG and the subsidiary (IC Objekt8 Frankfurt GmbH) holding the portfolio property at “Stiftstrasse 18/20”, this non-liquidity-related extraordinary depreciation at the property company level leads to loss absorption by InCity AG. This in turn results in a new earnings forecast for InCity AG (single entity) for 2023 between EUR -2.3 m and EUR -2.8 m (previous forecast: between EUR -0.4 m and EUR -0.9 m).

In line with the information presented in the annual report for fiscal year 2022, InCity is currently preparing to sell approximately 89% of the shares in the property company holding the portfolio property at “Stiftstrasse 18/20” to Realsoul Holding S.A., Munsbach, Luxembourg, which holds approximately 92% of the shares in InCity AG. In order to determine a sale price in line with the market for the property in an environment where pricing is currently difficult, a market valuation of the property for sale was carried out by an external third party – in this case ahead of schedule – on 31 December of each year, as in previous years. Today, InCity AG was informed by the market value appraiser that the market price of the property at “Stiftstrasse 18/20” in Frankfurt am Main amounts to EUR 5.5 m. This external market valuation results in a non-liquidity-related extraordinary depreciation on the property amounting to approximately EUR 1.9 m in December 2023, which significantly reduces the InCity Group’s earnings forecast for fiscal year 2023: Taking further effects into consideration which, when offset, have a total positive effect on the Group earnings forecast for 2023, the new Group earnings forecast for 2023 anticipates an amount between EUR -5.0 m and EUR -5.5 m (previous Group forecast: between EUR -3.8 m and EUR -4.3 m). In contrast to the original Group earnings forecast, positive effects on the new Group forecast for 2023 particularly include lower investments in portfolio properties than initially planned that would not have been capitalised. It also remains the case that the new Group forecast for 2023 contains regular HGB depreciation (also non-liquidity-related) of approximately EUR 1.9 m on property, plant and equipment (particularly on portfolio properties) as the portfolio properties are reported at amortised cost according to HGB accounting principles.

Based on the existing profit transfer agreement between InCity AG and the subsidiary (IC Objekt8 Frankfurt GmbH) holding the portfolio property at “Stiftstrasse 18/20”, the non-liquidity-related extraordinary depreciation at the subsidiary level leads to loss absorption by InCity AG. This in turn results in a new earnings forecast for InCity AG (single entity) for 2023 between EUR -2.3 m and EUR -2.8 m (previous forecast: between EUR -0.4 m and EUR -0.9 m).

With the planned sale of the portfolio property at “Stiftstrasse 18/20” in Frankfurt am Main by means of a share deal, InCity AG is divesting its last property in Frankfurt am Main. The remaining six portfolio properties are in good or very good (central) locations in Berlin and are expected to have long-term value stability due to their location and property quality.