ANNUAL REPORT 2004 - Breevast

MA NAGEMENT RE PORTStrategy and development of real estate activitiesBREEVAST ANNUAL REPORT 200414In accordance with that stipulated in Article 26 of the Articlesof Association, we herewith present the Annual Report for2004, the company’s forty-first business year.STRATEGY AND DEVELOPMENT OF REALESTATE ACTIVITIESThe company’s real estate activities in the Netherlands,Belgium and North America comprise three strategicsegments, i.e.:1. The development of the existing real estateportfolio, while further improving its quality.Besides acquiring (portfolios of) properties to which valuecan be added, Breevast also purchases optimized premises.In this way, an attempt is made to enlarge and renew thereal estate management portfolio. A close eye is kept onthe general quality of a property, including the location,the flow of rent and the type of debtor.2. The maintenance of a revolving real estateportfolio to foster the dynamics of the company.Breevast B.V. is interested in the acquisition of large portfoliosof listed real estate funds, either with or without partners.On account of the large transaction volume, such portfolioscan be purchased at a discount. The aim is to retain some ofthe properties for a short period and then to sell them.3. The development of commercial real estate primarilyfor the company’s own portfolio.Higher initial returns are created by means of the developmentof real estate projects under the company’s owndirection. This is possible because Breevast B.V. employsa very stringent budget discipline and limits risks byensuring that a substantial portion is rented beforeconstruction begins. Furthermore, by also operating inthe development field, market-relevant expertise is retainedwithin the company. After completion, such new and easilymarketable real estate is generally added to the real estatemanagement portfolio.The NetherlandsDuring the year under review, a small number of acquisitionstotaling EUR 50.9 million were made in the Randstadurban conurbation. One acquisition in this respect was thepurchase of the second part of the so-called IBM Campus inZoetermeer, the first part of which was already acquired in2003. In the coming years, this approximately 14-hectare sitewith its existing buildings will be redeveloped with furtheroffices and housing. The former office building on the PrinsesIrenestraat on the Zuidas in Amsterdam in which NautaDutilh was established was also delivered to Breevast duringthe financial year. The purchase of these premises was alsoalready agreed in 2003. Business premises in the Westelijkhavengebied in Amsterdam was acquired by means of a saleand lease back transaction with Vendex KBB. Finally, thecompany entered into an unconditional purchase commitmentwith respect to a large-scale distribution complex, alsosituated in the Westelijk havengebied. The purchase of thisproperty will take place at the end of March 2005.The sale of the real estate properties under managementduring the year under review included the furnishing of fivebuildings situated in Weesp, Nieuwegein, Houten, Rotterdamand Raamsdonksveer to a fund related to iOG. Agreementon this sales transaction was already reached in 2003. Therealization of the development and renovation of office andindustrial premises in Eindhoven with a total floor area ofabout 23,000 m2, which commenced in 2003, was successfullycompleted in the first quarter of the year underreview. The premises that were leased for 15 years afterdelivery was disposed of to a firm during the year underreview. In December of the financial year, a retail propertyin Amsterdam Noord was sold and delivered to a fund ofAchmea Vastgoed. The total sales of the properties undermanagement amounted to EUR 49.9 million.Some of the properties from the revolving real estate port foliowere disposed of during the year under review. Breevast’sshare in this amounted to approximately EUR 9.7 million.