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Performance on strategy

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Financial performance

Fund return

The Fund realised a total return of 11.1% in 2021, consisting of a 2.1% income return and 8.9% capital growth. Net rental income, administrative and finance expenses were the main drivers for the income return. Capital growth was primarily driven by the ongoing demand for homes, the shortage of homes and the high levels of investor interest in this sector.

The total fund return ended above target. The Fund’s income return ended on target and capital growth 10.0 %-points above target. The strong demand and lagging supply keep pushing vacant values upwards. These results confirm that the impact of Covid-19 on the (rental) housing market has so far been limited due to the strong fundamentals of the Dutch housing market.

Fund performance

2021

 

2020

 

Actual

Plan

Actual

Income return

2.1%

2.1%

2.4%

Capital growth

8.9%

-1.1%

4.4%

Fund performance

11.1%

1.0%

6.8%

Income return

Net rental income of € 186.4 million was € 0.6 million higher than the plan of € 185.8 million (2020: € 194.6 million). The most significant driver of the deviation from plan were higher gross rental income (€ 1.1 million) and higher other income (€ 0.3 million), partly offset by higher property operating expenses (€ 0.7 million) and higher service charge expenses (€ 0.1 million).

Administrative expenses (€ 37.5 million) were € 1.3 million higher than plan (€ 36.2 million) due to higher management fee costs, directly driven by the Fund's higher than planned average NAV. Finance expenses totalled € 4.2 million, almost on plan (€ 4.4 million).

The higher net rental income and higher administrative expenses resulted in an income return of 2.1%, the same as the plan.

Capital growth

The Fund realised capital growth of 8.9% compared with a plan of -1.1%. This figure confirms that the impact of Covid-19 on the (rental) housing market has so far been limited.

Property performance

The total property return for 2021 came in at 11.8%, consisting of a 2.7% income return and 8.9% capital growth. The Fund showed an underperformance of 3.6 %-points versus the MSCI Netherlands Index (all properties). The underperformance was largely driven by the capital growth which was 3.3 %-points lower than the benchmark's capital growth of 12.2%. In addition, the income return was 0.2 %-points lower than the benchmark's income return of 2.9%.

The Fund return (INREV) and property return (MSCI) are different performance indicators. The Fund return is calculated according to the INREV Guidelines as a percentage of the net asset value (INREV NAV) and the property return is calculated according to the MSCI methodology as a percentage of the value of the investment properties. For example, INREV includes cash, fee costs and administrative costs in the calculation of the income return (INREV). Furthermore, the amortisation of acquisition costs is treated differently by INREV and MSCI.

Property performance

2021

2021

2020

 

Actual

MSCI

Actual

Income return

2.7%

2.9%

2.8%

Capital growth

8.9%

12.2%

4.4%

Property performance

11.8%

15.4%

7.3%