Portfolio developments in 2022

In the first half of 2022, the ARC Fund again showed a strong operational performance. From Q3 onwards, results were impacted due to negative revaluations. We delivered and added 477 homes to the standing portfolio, bringing the total number of homes to 11,010. The occupancy rate remained high at 97.8%, meeting our target vacancy rate of <2.5%, These are strong results considering the challenging market conditions as a result of high inflation and low consumer confidence levels.

Operating costs rose from 20.6% in 2021 to 21.7% in 2022, but stayed in line with budget. This is partly the result of the higher costs for both materials and labour. Building and renovation work also faced delays due to the scarcity of materials and our contractors having to deal with the growing shortage of qualified personnel.

The portfolio's net growth after disposals was 167 homes in 2022. As of January 1, 2023, the transfer tax further increased to 10.4%. Despite the changing market and decreasing values, we managed to realise a block sale in Rotterdam consisting of 242 apartments and several ground floor commercial units. Due to the changed markt dynamics in Q3, individual sales slowed down. We executed 68 individual sales, recoding a net gain of 21% compared to book value.

The secured pipeline features 2,533 homes representing EUR 496 million in off-balance sheet commitments. The projects in this pipeline are set to be completed between 2023 and 2026.

Our RoFR Agreement with Amvest Development Fund B.V. (ADF) is responsible for approximately 24% of our committed pipeline. In addition, 28% of projects in this pipeline are acquired from ADF partnerships with a third party, for which a best effort offer obligation to ARC Fund is in place. The RoFR agreement, which was updated in 2023 to include a rotation mechanism, continues to ensure sufficient and constant access to new, high-quality residential rental properties at excellent conditions on a long-term basis.