Havenview Investments, the development vehicle for the Irish property interests of Real Estate Opportunities (Reo), slipped into the red last year as interest and other charges rose sharply.
The company, which is half-owned by Reo and half by Treasury Holdings, posted operating profits of €4.3 million for the year, up by 8 per cent from €3.98 million in 2003.
The higher profits were, however, cancelled out by €11 million in interest and similar charges. These charges amounted to €4.2 million in the previous year.
The main source of the increase, according to accounts recently filed with the Companies Office, was the absence in 2004 of the €4.6 million currency gain the company recorded in the previous year.
Turnover, drawn from a mixture of retail and office rents, fell from €5.6 million to €5.4 million.
The accounts show the firm paid €5.9 million in interest on loans due within five years from Reo and its subsidiaries. In 2003, the comparable interest payment was €5.7 million.
Havenview borrowed £40 million (€58 million) from Reo upon its establishment in 2001. During 2004, this loan was restructured as part of a Reo capital reorganisation, which, according to Reo's 2004 annual report, "improved the tax efficiency of the group".
As a result, Havenview now has a loan of €56.4 million from Luxembourgish company Reo Luxembourg. It previously held loads from Real Estate Opportunities Limited and Real Estate Opportunities Holdings Limited.
Havenview's portfolio, which includes the Central Park development at Leopardstown and Ballymun Shopping Centre, was valued at €182.8 million at the end of last year. This marked an increase of 7.4 per cent on 2003, with Havenview taking the surplus on revaluation of €6.7 million to its revaluation reserve.
Two months ago, Havenview agreed the sale of 1.14 hectares at Central Park for an initial price of €59.1 million, of which €51 million was payable in cash and the remainder in commercial units and car parking spaces.
The directors include Richard Barrett and John Ronan, who own Treasury Holdings which, in turn, controls 56.5 per cent of Reo.
