REO cuts pre-tax losses by £750m

REAL Estate Opportunities (REO), the Treasury Holdings-controlled property development company, slashed its pre-tax losses in its last financial year — from £828m to £77m (€86.37m) on the back of making lower impairment provisions on its property portfolio.

Over the year to the end of February, REO also saw its loss per share fall — from 248.2p to 23.1p. However, property income fell (across its Irish and British portfolios) from £44m to £34m, due to a number of circumstances, including the firm’s reduced reporting period.

REO’s managing director for Ireland, John Bruder, said the market in the past year has remained “very challenging and difficult, particularly in Ireland”.

“Notwithstanding that, it was a good year for us and our Irish portfolio did incredibly well.”

Three quarters of REO’s Irish portfolio comprises investment properties, of which 65% are made up of offices and the remainder retail tenants. Mr Bruder said that occupancy levels in its Irish portfolio remain high at 92%.

The company did warn, however, the potential abolition of upward only rent reviews could seriously impact Irish property values and its portfolio value. REO’s agreement with NAMA has secured its short-term funding requirements, but the firm said the repayment of liabilities owed to the agency and other creditors will be a “significant task”, given the difficult trading environment.