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EPRA Net Initial Yield

The EPRA Net initial yield shows the ratio of annualized rental income minus property outgoings (annualized net rent) to the gross fair values of the residential properties. The fair values are increased by the purchasers’ costs.

The topped-up Net initial yield eliminates the rental incentives in the annualized net rental income. Rental incentives are of only minor importance to a company specializing in residential properties.

Despite the significant increase in annualized rental income, the EPRA Net initial yield decreased from 3.0% in 2020 to 2.6% in 2021. The reason for this is a significant increase in the fair value of the real estate portfolio beyond the rent development (yield compression).

EPRA Net Initial Yield

in € million

2020

2021

Change in %

Fair value of the real estate portfolio (net)

56,834.4

92,411.7

62.6

Allowance for estimated purchasers' costs

3,920.8

6,420.5

63.8

Fair value of the real estate portfolio (gross)

60,755.2

98,832.2

62.7

Annualized cash passing rental income

2,351.9

3,234.8

37.5

Property outgoings

-505.5

-668.4

32.2

Annualized net rents

1,846.4

2,566.4

39.0

Adjustments for rental incentives

4.9

6.8

38.8

Topped-up net annualized rent

1,851.3

2,573.2

39.0

EPRA Net initial yield in %

3.0

2.6

-0.4 pp

EPRA Topped-up Net initial yield in %

3.0

2.6

-0.4 pp

  1. * Fair value of the developed land excl. IFRS 16, development, undeveloped land, inheritable building rights granted, nursing portfolio.