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In the 1st quarter of 2022, SRE sold 31 properties for 1.66 million euros

26.05.2022

In the 1st quarter of 2022, SJSC “State Real Estate” (SRE) achieved a turnover of 11.08 million euros and a net profit of 2.12 million euros. In the first three months, SRE has sold 31 properties for 1.66 million euros, including 8 environmentally degrading objects, informs Renārs Griškevičs, chairman of the board of SRE.

Compared to the first quarter of 2021, the number of auctioned properties has increased by 8 transactions, while the number of large-scale transactions has decreased – in the 1st quarter of 2022, 31 properties were sold at auctions for 1.658 million euros, including 8 environmentally degrading objects at 8 addresses, while during this period SRE sold 23 properties in the amount of 4.4 million euros. The most significant sales transactions in the 1st quarter of 2022 are the building at Dzirnavu iela 113, Riga (1.2 million euros) and the building at Smiltenes iela 1A, Jurmala (192 thousand euros). SRE uses the proceeds from sale of real estate in arranging the properties necessary for the state and establishing sustainable offices.

Turnover of SRE in the 1st quarter of 2022 reached 11.08 million euros, three-month EBITDA was 5.06 million euros, net profit reached 2.12 million euros. In the first quarter of 2022, compared to the same period last year, income from real estate rental increased by 5% or 0.3 million euros (reaching 5.73 million euros). Income from state real estate management and construction increased by 17% or 0.52 million euros (reaching 3.43 million euros). Income from the Company's real estate management and alienation of state real estate amounted to 1.92 million euros.

Overall, the company's operations in 2022 are carried out in accordance with the SRE medium-term operation strategy for 2018–2022 and operational plans. “In the first quarter of 2022, despite the sharp rise in energy prices even before the start of war in Ukraine and rising construction costs, the SRE ensured the stable operation of companies. Due to the geopolitical situation, we have set the priority in the state-commissioned projects to ensure the continuity of work within a reasonable time by cooperating with all involved. At the same time in 2022, we continued to follow the development goals of SRE – satisfied customers, engaged and motivated employees, sustainable operations and property management and development, which also includes the improvement of the future office development concept,” points out R. Griškevičs.

Due to the restrictions of the pandemic in January and February of this year, SRE continued to provide support to 50 tenants, reducing or exempting them from rent in the amount of 68,972 euros.

At the same time, strengthening the overall safety and construction supervision of the company and the industry in general is also a priority for SRE. The State Construction Control Bureau, in cooperation with SRE and other industry experts, has developed guidelines for the construction supervision service, the purpose of which is to provide support to construction initiators and guide them through not-so-easy construction process and regulatory framework included in several laws and regulations. SRE has started work on sustainable construction guidelines, where in addition to the existing requirements of laws and regulations, SRE will set sustainability requirements for the performers of works, the implementation of which will reduce the life cycle costs of the building and the negative impact on the environment. It is planned to start the implementation of requirements in SRE procurements already this year.

The most significant of the 46 development projects managed by SRE with a total project budget of 230 million euros are the construction of the infrastructure of the external land border of the Republic of Latvia and Belarus in priority sections, reconstruction of the New Riga Theatre complex, restoration and reconstruction of Riga Castle convent (kastel), increasing the energy efficiency of the Latvian Puppet Theatre building and Valmiera Drama Theatre building, modernisation of the Terehova border crossing point, development of the reconstruction and renovation project of the Great Guild Concert Hall, adaptation of the building at Mārstaļu iela 6 to house the Museum of Music and Writing, establishment of the Performing Arts Decoration Workshops and Rehearsal Hall complex at Meirānu iela 2, renovation of Daile Theatre forecourt and restoration of the cover of the Latvian Riflemen's Square.

SJSC “State Real Estate”. The company provides professional real estate management and administration for approximately 365 real estate properties consisting of 1100 buildings with a total floor area of 0.95 million square metres, along with land beneath the buildings covering 602 hectares and more than 3536 land properties with an area of 903 hectares. SRE is one of 23 Latvian companies that has received the highest platinum award as part of the Sustainability Index of the Institute of Corporate Responsibility and Sustainability, confirming the good governance and sustainability of its operations. The company was founded in 1996, 100% owned by the Ministry of Finance of the Republic of Latvia.