Patient, but never passive
The projected economic slowdown came to pass in 2023, impacting the Dutch residential real estate market. The trend of negative revaluations, which initially emerged in 2022, persisted throughout the year.
The Dutch economy
Since the end of the Covid-19 pandemic in late 2021 and the start of the war in Ukraine in early 2022, the inflation rate has increased significantly, exceeding 10.0% in the second half of 2022.
The Dutch residential market
The current housing shortage is approximately 390,000 homes (Primos, 2023), which is 4.8% of the total housing stock.
Portfolio strategy
The ARC Fund invests in the Dutch residential rental sector and has a long-term horizon. We are committed to making future-proof choices to realise attractive, stable dividend yields and long-term value growth for our Investors.
Portfolio policy
The ARC Fund invests in the Dutch residential sector with a strong focus on affordable/attainable, high-quality and sustainable residential properties located in areas with the best economic and demographic potential.
Portfolio developments in 2023
We delivered 264 homes to the standing portfolio, sold 44 individual homes and 75 homes as part of a block sale. Between 2022 and 2023, the ARC Fund standing portfolio increased from 11,010 to 11,155 homes, a net addition of 145 homes.
Portfolio - composition
At the end of 2023, the ARC Fund standing portfolio consisted of 11,155 homes with a book value of EUR 3.8 billion. The average book value per home decreased by 6.2%.
Portfolio - operation
The portfolio gross rental income in 2023 was EUR 164.2 million, compared to EUR 153.5 million in 2022. This growth is driven by the annual rental increase, rental turnover, and portfolio dynamics.
Portfolio - dynamics
In 2023, the ARC Fund standing portfolio increased to 11,155 homes with a value of EUR 3.8 billion, compared to 11,010 homes with a value of EUR 4.0 billion in 2022. In 2023, we invested EUR 190 million in the pipeline.
Financial performance in 2023
In 2023, the portfolio value (including assets under construction) decreased by EUR 100 million (-/-7.1%; 2022: -/-2.0%) due to four quarters of negative revaluations. Investor interest remained low amidst rising interest rates.