Bostad Danmark ApS

Main activity The Group's main activity is letting of residential real estate in the affordability segment. As at the balance sheet date, the Group owns approx. 1,565 leases (excluding parking). Approx. 86% of the rental income in 2020/21 came from residential leases and approx. 14% came from commercial leases (including parking). The total book value of the properties as per 30 June 2021 is DKK 2.63 billion and the equity as per 30 June 2021 is 848 million.

After the balance sheet date, the Group has divested a 24,168 m2 logistics property and entered into and closed an agreement concerning acquisition of an 8,470 m2 residential property with 84 newly built residential units. Consequently, the Group now owns a total of 1,641 leases (excluding parking). Approx. 95% of the rental income in …

Development in activities and financesThe annual report for CL Denmark ApS for the period 1 July 2020 to 30 June 2021 includes the result of the Group's activities.

The financial year 2020/21 is characterized by (i) the Group’s continued focus on streamlining the portfolio around quality residential properties in strong Danish growth cities outside Copenhagen and Aarhus, (ii) divestment of commercial properties and smaller residential properties in line with the Group's strategy, (iii) significant extraordinary investments in the Group’s properties to ensure a high maintenance standard throughout the portfolio, (iv) investments in insourcing of the Group’s facility management and letting setup, and (v) work on securing and preparing the Group for a continued growth journey in the coming ye…

The outlook and the profit expectations for the future are based on a basically unchanged property portfolio with the addition of 84 newly built residential units, which were delivered in August 2021 and the divestment of the logistics property located on Østhavnsvej in August 2021. Please refer to the section above regarding events after the balance sheet date.

CL Denmark ApS expects a profit before financial items of approx. DKK 90 million and a profit before tax and value adjustments in the range of DKK 65 to 70 million for the financial year 2021/22.…

Profit/loss for the year in relation to expected developmentsGroup

Operating profit for the year was DKK 281 million (2019/20: DKK 179 million) and profit for the year before fair value adjustments of investment properties and tax was DKK 22 million (2019/20: DKK 6 million).…

The Group's investment properties are measured at fair value, which as at the balance sheet date amounts to DKK 2.63 billion. The fair value is calculated for the individual properties on the basis of several assumptions, including the budgeted cash flows of the individual properties as well as established discount factors, refer to the discussion included in the description of applied accounting policies. The discount factors are set so that they are assessed to reflect the market's current required rate of return on similar properties, including expected inflation. There is uncertainty associated with the determination of the discount factors, and an increase in the discount factor by an average of 0.5 percentage points will reduce the total fair value by DKK 202 million, refer to the discussion included in note 1 to the accounts.

On initial recognition, the Company’s investment property is measured at cost, which comprises the acquisition price of the property and any costs directly related thereto. The investment property is subsequently measured at an estimated fair value calculated on the basis of the Discounted Cash Flow model (DCF model). The model is based on the future cash flows of the property, which are discounted at a fixed discount rate with adjustment of the risk of the individual property.

The significant assumptions used when determining the fair value are the annual changes in rental income and operating costs as well as the discount rate, which includes a required rate of return and inflation. On average, a discount rate of 5.93 % has been used.…

Events after the balance sheet date• In July 2021, the Group entered into an agreement concerning acquisition of 84 newly built residential leases and 126 parking spaces. The new leases are located in Holbæk and were delivered to BoStad on 17 August 2021. The project is expected to increase the Group's revenue by approx. DKK 13 million per year.

• As part of the strategy to focus the Group's properties on residential properties in larger, regional cities in Denmark, the Group has sold 7 smaller residential properties after the balance sheet date.…

The Group has entered into an agreement regarding property management. The liability until maturity amounts to 3.1 million.

16 Assets charged and collateralMortgage debt is secured by deposited mortgage deeds on the investment property with a book value of TDKK 2,634,214.