Overview of the Group’s financial results for 2016
According to the company’s management board, E.L.L Kinnisvara Group‘s financial results for 2016 were in line with expectations – the Group‘s return on sales remained at last year’s level, i.e. EUR 42 million, and net profit was EUR 17.7 million. In 2016 the company continued to develop the projects in its portfolio and to work on the process of starting up new development projects.
The company values long-term relationships with its lessees in office buildings as well as shopping centres. With the objective of preserving the value of real estate in the portfolio and offering the best business environment, E.L.L. Kinnisvara is continuously developing the real estate in its portfolio. Highlights for 2016 included construction work on the car park levels at the Vilnius Panorama shopping and leisure centre, and the installation of LED screens in the Tallinn Viru Shopping Centre and the Spice Shopping Centre in Riga. With the goal of providing convenient access to customers and increasing the number of available parking spaces, an additional exterior car park – with several hundred spaces – was built towards the end of 2016, next to the Riga Spice Home shopping centre. In cooperation with an international architectural firm, an analysis of the Spice shopping centre complex for the purposes of expansion and renewal was completed, with a more precise plan of action and schedule set to become clear in 2017. A combined power and heat plant was built in the Sõpruse Ärimaja, in Tallinn, which serves as an energy efficient, environmentally friendly and modern solution to the co-production of electricity and thermal energy, reducing the ancillary costs of lessees. Reconstruction works were performed on the entrance to the Delta Plaza office building, located in Tallinn. The Nordic Hotel Forum updated its conference area, a more functional revolving door was installed by the main entrance, and the restaurant in the Tallinn Express Hotel was updated.
Construction works continued in 2016 at the Narbuto 5 office building in Vilnius. The Class-A office building is located in close proximity to the Panorama shopping and leisure centre and will be completed in the middle of 2017. As at the end of April 2017, over one half of the building’s area has been covered with lease contracts, the office building’s anchor tenant is If P&C Insurance.
The company continued with preparatory works for new development projects. The Skanstese project, located in Riga, Latvia, is comprised of five office buildings (a total of nearly 45 000 m² of lease space) and a multi-storey car park. The first stage of development covers two office buildings that are connected to one another (a total of nearly 28 000 m² of lease space, and underground parking levels), with design work planned to be completed by the end of 2017, and construction set to begin thereafter.
Active preparatory works continued on the development of a multifunctional quarter on the corner of Liivalaia and Juhkentali streets in Tallinn. The development project covers two commercial buildings (a total of more than 40,000 m² of leasable Class-A office and commercial space), one residential building (nearly 50 apartments), and the multi-storey car park connecting the two buildings. In the autumn of 2016, a design criteria application was submitted to the City of Tallinn. Under the design criteria issued by the city, an international architectural competition will be carried out in 2017, and design work will begin. The company also continued to work out a development concept for the Kalasadam 10 registered immovable, located next to the Linnahall, and the J. Smuuli tee 1 registered immovable, located in Lasnamäe.
E.L.L. Kinnisvara’s goal is to develop functional business environments that fit into the city space and create additional public areas. People are at the centre of the entire development process: the employees and visitors of the lessees in the office buildings, residents of the surrounding area and visitors to the building. In its developments, the company adheres to a long-term strategy, based on which very high quality and sustainability requirements are set for the developments, so that the real estate’s value will be maintained over time. In addition to real estate development the company also performs the role of owner and administrator, in which it also follows a people-centred approach: the goal is to offer complete solutions, service and experience, which helps companies located in E.L.L. Kinnisvara’s developed and owned office buildings to grow their business.
E.L.L. Kinnisvara AS is mainly active in commercial real estate portfolio management and the development of new projects. E.L.L. Kinnisvara is active within the Baltics and commercial activity takes place in the capitals of the three countries. We are among the largest owners of private real estate in the Baltic states. As at the end of 2016, our portfolio included nine commercial buildings with nearly 184 000 m² of leasable space: two office buildings (25 000 m²), three hotels (762 rooms, 39 000 m²) and four shopping centres (120 000 m²). As at the end of 2016, the Group’s Estonian, Latvian and Lithuanian branches employed a total of 48 people.
In 2016, E.L.L. Kinnisvara was recognised as Estonia’s most competitive real estate undertaking at the entrepreneurship competition organised by the Estonian Chamber of Commerce and Industry. In 2016, E.L.L Kinnisvara contributed to society through a number of different cooperation projects. At the end of 2016, the company supported the acquisition and renovation of homes being built in Kohtla-Järve by SOS Children’s Village, in which four new families, i.e. 24 children will be able to live. Through the Eesti Tennise Liit the company supported the development of youth team players. In 2016, E.L.L. Kinnisvara began cooperation with the Faculty of Architecture at the Estonian Academy of Arts, which is starting the major project ‘Unfinished City’, within the framework of a cooperation agreement with Tallinn, in which the focus will be on spatial scenarios and visions for future urban developments in the city.