Annual report 2008 - Altarea Cogedim

CONSOLIDATED FINANCIAL STATEMENTS
17.5. Other off-balance sheet commitments
n Commitments given
The main commitments given by the Group are mortgages and mortgage commitments made to secure loans or lines of credit
from credit institutions. See note 13.16, “Financial liabilities”. In addition, ALTAREA SCA guarantees loans to other Group
companies in an amount of €665.2 million. These commitments principally comprise a joint and several guarantee from
ALTAREA SCA to Cogedim SAS in respect of the €300 million loan arranged in connection with the acquisition of Cogedim.
Pledges of securities, assignments of receivables (intra-Group loans, rental income, interest rate hedges, VAT, insurance
policies, etc.) and undertakings not to sell or assign ownership units are also made by the Group to secure certain loans.
• Owned shopping centre business
The main other commitments given in the owned shopping centre business are deposits or guarantees given primarily to credit
institutions, partners or sellers of land in the amount of €115.5 million at 31 December 2008.
As part of the development of shopping centres and property development for third parties, performance bonds are granted
by financial institutions to customers in connection with their acquisition. In return, ALTAREA gives the financial institution
a promise of mortgage security and an undertaking not to sell ownership units.
In connection with projects under development, the Group signed contingent sale contracts and forward sale contracts in a
total amount of €150.4 million.
• Property development for third parties
Other commitments given by the property development for third parties business came to a total of €266.6 million, including
performance bonds in an amount of €219.2 million and earnest and option money deposits in an amount of €16.8 million.
n Commitments received
• Owned shopping centres
• Unutilised confirmed credit lines
At 31 December 2008, ALTAREA had €102 million of confirmed credit lines that had not been utilised and were not assigned
to specific development projects.
• Security deposits
Under France’s loi Hoguet, ALTAREA holds a security deposit received from FNAIM in an amount of €37 million as a
guarantee of property management and sales activity.
ALTAREA holds security deposits received from tenants in an amount of €6,417 thousand as a guarantee of rent payments.
In France, ALTAREA requires performance bonds from the construction contractors on its shopping centre development
projects. In return, ALTAREA has signed undertakings for works contracts with the construction companies. In return for
payments made on projects under development, the Group has received bank guarantees in amounts of €38,917 thousand
in Italy and €60,478 thousand in Spain.
• Other commitments received (€ thousand)
For acquisitions and buyouts of minority interests, ALTAREA secures guarantees, in particular covering potential tax liabilities.
The representations and warranties provided by the Affine group for the sale of the controlling interest in Imaffine on
2 September 2004 were transferred as part of the merger, and so ALTAREA now directly holds a 10-year guarantee covering
Imaffine’s net assets before the merger.
In connection with the acquisition of Altareit, ALTAREA received a guarantee from seller Bongrain that it would be held fully
harmless through a reduction in the selling price from any damage or loss originating from the business activities effectively
suffered by Paul Renard with a cause or origin predating 20 March 2008 for a period of 10 years.
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