Echo Investment summarizes the first half of 2021, taking into account the results of the Archicom S.A. group for the first time. The first six months of 2021 brought the Group over PLN 47 million in net profit, which was mainly the result of handing over to customers 398 apartments built by Echo Investment, as well as 202 apartments of Archicom and an increase in the value of office buildings – in particular Malthouse Offices in Warsaw Breweries and Brain Park I in Cracow. Important item that influenced the results for the first half of the year and the second quarter was the profit on purchase price allocation of Archicom S.A. shares.
Reaching the strategic goal of becoming a nationwide leader in the residential sector, Echo Investment acquired a 66% stake in the Wrocław-based developer Archicom on April 22, 2021. The Echo-Archicom Group is currently the biggest residential developer in Poland, building apartments for sale and rent.
“The Group maintains a high level of cash: at the end of the first half of the year it was PLN 630 million. The value of our assets amounted to over PLN 7 billion and is 25% higher than at the end of last year. This is mainly a result of the acquisition of Archicom S.A. group – the increase in the value of residential assets amounted to 90%. Our priority is to maintain a strong financial position and further development in the residential segment to maintain and strengthen the leading position,” comments Maciej Drozd, CFO of Echo Investment.
In the first half of the year, Echo and Archicom sold a total of 1,719 apartments to clients and handed over 600 units. In the second half of the year, the Group expects to receive occupancy permits for 14 projects with 2.2 thous. apartments. The Group is constantly expanding its offer and currently has 4.4 thous. apartments for sale under construction while in the second half of the year it will start investments with a total of more than 2.4 thous. units.
“We are consistently developing Resi4Rent – the largest company with apartments for rent in Poland. Currently Resi4Rent has 2.3 thous. completed apartments in offer which in 2022 will grow to 3.7 thous. and to 6 thous. in 2023. Ultimately, by 2025, Resi4Rent will offer at least 10 thous. apartments in the six largest Polish cities. In 2021, it has already started the construction of over 1.1 thous. units, and by the end of the year, it will start building additionally 1.3 thous. The plan for each year is to start up construction of another 3 thous. units,” sums up Nicklas Lindberg, CEO of Echo Investment.
In the first half of this year alone, Resi4Rent launched 600 units at Suwak and Taśmowa Streets in Warsaw, as well as opened seventh building – this time in Gdańsk at Kołobrzeska Street, where another 302 units are in offer.
Echo Investment currently has office buildings under construction with a total leasable area of around 100 thous. sqm, and a further 200 thous. sqm are in the planning stage. Since the beginning of 2021, two completed office buildings which are part of the Warsaw Breweries complex have found new owners. The company sold Villa Offices in March and Malthouse Offices in August. Jointly transactions were worth €240 mn and are proof that mixed-use 'destination' projects – places that attract people – are more than ever in demand by investors. Talks on the sale of other buildings are also in advanced negotiations.
“In the first half of the year, we started to develop the Brain Park office project in Cracow and another office building in the Fuzja complex. We acquired new, reputable tenants, such as Playtika, 3M GSC Poland or ABB, which shows the strength of the office sector. That is why we intend to start construction of 3 more office buildings by the end of the year,” says Nicklas Lindberg.
Since restrictions on trading were lifted this spring, in retail segment Echo Investment has focused on strong marketing efforts and strengthening Libero and Galeria Młociny shopping centers as they return to their normal operations. Both projects record an increase in footfall compared to 2019, and more importantly – a 30% increase of tenants’ turnover compared to 2019.
