VIB is a Dutch company, quoted on the Amsterdam, Brussels and Antwerp stock exchanges. Founded in 1964 as an investment fund, its has altered its statutes to become a property company but still enjoys exemption from corporation tax provided it distributes profits to shareholders.
The company is pursuing an aggressive expansion policy. In 1994, it acquired fellow Dutch property company Innovest, increasing its portfolio from NLG 1.6bn to NLG 2.7bn, and it aims to double the size of the portfolio during the next few years. The acquisition of Innovest, which had substantial North American holdings, permitted VIB to concentrate its international strategy in three main markets: the Netherlands, France and North America.
VIB’s legal structure and organisation reflects this approach: the Dutch registered company is a holding company for a number of country funds, each of which operates with a local management structure.
At June 30, 1995, property in the Netherlands accounted for 52% of the portfolio, by value, North America was 20%, France was 17% and other European countries, 11%. Offices accounted for 64% of the holdings, retail – mainly shopping centres – was 30%, and industrial, 6%.The other European countries in which VIB owns property are the UK, Germany, Italy and Spain. With the exception of Spain, the company has decided to sell its interests in these countries, because its portfolios are too small to represent a spread of risk, and to be managed efficiently. VIB considers an adequate portfolio size in a particular country to be NLG 500m. In Spain, it has not ruled out the possibility of further investment.
In its structure of individual company funds, VIB has recognised the growing demand from institutional investors for more diverse indirect methods of investment, but it has stopped short of giving investors access to individual funds. The board last year considered allowing institutions to participate in particular country funds, with a view to seeking an eventual listing in each of the markets, but decided that “in order to preserve essential flexibility and effectiveness”, the existing format should be retained.
The company has had to make substantial write-downs on the value of its properties, every year since 1991. Revaluations at the end of 1994 dented the balance sheet by NLG 207m, with Canada and the United States seeing the greatest write-downs. During the first half of 1995, there was little change in the aggregate value of the portfolio; upward revaluations in the US and the UK were matched by further falls in France and Germany.
Last year was one of consolidation for the company. In the first half, it sold NLG 124m of property in the Netherlands and the US, at above book value. As these funds could not be immediately re-invested in high-yielding property, however, and in the light of lower interest rates, the company warned that these sales would have an adverse effect on profits.
VIB
Slotlaan 20
Zeist
tel +31 3404 28300
fax +31 3404 12041
