Good morning, everyone, and thank you for joining us here today for our Q2 results presentation. As said, my name is Gundolf Moritz, and I'm heading Investor Relations. With me are Thierry Beaudemoulin, CEO of Adler Group, and Thomas Echelmeyer, CFO. Both will guide you through today's presentation, which you can find on our website as well. At the end of the presentation, we have reserved time for a Q&A session, where management will answer any questions you may have. Please note that this call will be recorded and made available on the company's website after the call. With this, I would like now to hand over to Thierry. Please go ahead.
Thank you, Gundolf. First of all, I would like to thank everybody for joining us here today. Before updating you on our strategy, let me first introduce Hubertus Kobé. Hubertus has been appointed as Chief Restructuring Officer and has the responsibility to oversee the restructuring plan of Adler Group in accordance with the approved restructuring plan. Welcome to the team, Hubertus. Now, please join me on page four of the presentation to update you on the progress achieved within our five strategic pillars. On portfolio strategy, we are continuing our transition to a growing-centric portfolio with limited development exposure. To do so, we are reoffering our NRW portfolio to the market and will continue to execute orderly disposal of further selected portfolios and development projects in the short and medium term. To increase the disposal speed, we have mandated market-leading broker for our major development project.
On the asset management side, we have largely finished all committed CapEx on development projects. Additional sizable CapEx commitment has been put on hold, in line with what we previously communicated. Obviously, it goes without saying, we will continue required maintenance and relating CapEx where necessary. On financing strategy, our ambition is to have a financially stable platform to be able to actively delever. In that regard, we repay the EUR 500 million Adler Real Estate 2023 bond with the liquidity provided by the new money standing in April. Then we conclude a tender offer and consent solicitation to the order of the EUR 300 million Adler Real Estate 2024 notes, with 98.9% of the outstanding note validly tendered.
In the second quarter, we have refinanced other maturity at Adler Real Estate level for an amount of EUR 177 million, including accrued interest until 2026. With respect to the remaining maturity in 2023, this morning, we announced the potential refinancing of a convertible bond and Schuldschein loan at Adler Group level, as we are planning a EUR 191 million placement of a new payment in kind, secured 1.5 Lien notes, on which Thomas will tell you more in a moment. On the corporate structure, the squeeze-out process of Adler Real Estate has been approved during the extraordinary AGM by 97.9% of all shares. We have initiated the sales process of our stake in BCP, which is currently ongoing.
On Consus, we would like to mention that we, as their main shareholder, together with Consus, are working hard on the negative equity position of EUR 2 billion as per 2022. As the measure taken were not effective, we have asked external advisor to assist on this matter. But we are full confident that despite the negative equity, the going concern prognosis for Consus is positive, and Adler Group continue to be supportive of Consus business as a whole. On corporate governance, Rödl & Partner has been appointed as Adler Real Estate auditor and have started the audit process. Unfortunately, our discussion with international audit firm to audit the group financial statement were not successful for various reasons.
Therefore, we shift our strategy, which has resulted in a constructive discussion with a local Luxembourg auditor that will be in charge of the overall audit and local audit German firm about the so-called Component Audit. Let's move on to page 6. For this, I hand over to Thomas.
Thank you, Thierry, and also from my side, a very warm welcome to everyone here on the call. In addition to the update on the progress made on our five strategic pillars, we completed the restructuring plan, and we will now be focused on establishing a new foundation. Please allow me to refresh and update you on recent events regarding the restructuring plan. In April, the High Court of Justice of England and Wales sanctioned the restructuring plan, and the amendments to the terms and conditions of our notes were implemented.
The new money funding has been fully drawn in three tranches for a total amount of EUR 937 million to repay the EUR 500 million Adler Real Estate 2023 bond, tender the EUR 300 million Adler Real Estate 2024 bond, to provide additional liquidity of EUR 80 million to, for Consus, and the remainder being used for payment of reduction fees of approx EUR 57 million. In parallel to that, the issuance of new shares in Adler Group to the new money lender settled in an amount of 22.5% on a fully diluted basis. The Adler Real Estate bond of EUR 500 million was repaid on maturity on 27th of April. On 9th May, we launched a tender offer and consent solicitation in respect of the EUR 300 million Adler Real Estate 2024 bond.
We successfully completed the tender offer with 98.9% validly tendered on 13th of June. Dr. Heiner Arnoldi, Stefan Brendgen, and myself, Thomas Echelmeyer, have been appointed as additional board members following the approval of the group's general meeting. In addition to that, as just introduced by Thierry, Hubertus Kobé has been appointed to our senior management team in the position of Chief Restructuring Officer. Finally, on the 29th of June, the Court of Appeal granted permission to the appeal. We currently estimate the costs associated to the appeal in the middle 1-digit million EUR amount, and we need to have 3 days of hearing, which will take place between 23rd and 26th of October. Now, moving on to the key highlights on slide eight and back to Thierry.
Thanks, Thomas. Our residential portfolio continued to show strong operational performance in the second quarter of 2023, supported by solid underlying rental demand. The like-for-like rental growth in the second quarter has been +3.1% year-on-year, resulting in an average rent of 7.669 EUR per square meter per month. We will provide you with more detail on the rental growth driver in a moment. Vacancy remain at a very low level, standing at 1.4% at the end of H1, reflecting the high quality of our asset and our strong building own base. With the latter being a given, and with 72% of our portfolio located in our capital city, the higher interest rate affect the valuation of our lower yielding portfolio.
As such, the combined like-for-like value decrease for the entire portfolio amounted to -8.1% for the first half of the year. Moving to our financial performance. Net rental income came in at EUR 108 million, compared to EUR 131 million in Q2 2020. FFO from rental activity totaled EUR 8 million, compared to EUR 50 million in the same period of 2020. This correspond to FFO 1 per share of 0.60 versus 0.42 in 2020. Both NRI and FFO 1 were mainly impacted by the reduction in our yielding portfolio due to the disposal of the remaining part of the eastern portfolio to Velero portfolio, as well as the Leipzig portfolio sale at BCP level at the end of 2020.
EPRA NRV stood at EUR 1.3 billion, or 8.76 EUR per share at the end of the first quarter of 2023, compared to EUR 2.38 billion or 20.21 EUR per share as per Q1 2023. A movement that obviously was mainly driven by the negative revaluation. Please allow me to remind that we have decided to shift to a current NAV as a companion, main LTV matrix going forward, as recommended by, for the new EPRA guideline. Compared to Q1 2023, the EPRA LTV increased by 12.3 percentage points to 87.7%. The cost of debt has increased with 3.2 percentage points to 5.5%, which is of course, a result of a new money funding that has been drawn on 26 April.
Our cash position of EUR 231 million is stable. This is excluding cash held at BCP. After drawing the new money funding, puts us in a liquidity position to continue our operating activity, as well as servicing our debt obligation in the short and medium term. With regard to the development activity, it's fair to say that against the backdrop of a substantially more difficult market environment, progress is not as fast as we would like it to be. Regardless, we have continued our effort to reduce our development exposure further. First of all, we have mandated market leading broker to assist in disposing development project. Secondly, in Q2 2023, one small project has been closed, two projects have been signed, and we are in exclusivity with one project.
More specifically, the sale of Arthur-Hoffmann-Straße has included net proceeds amounted to EUR 2 million. The sales of two development projects located next to Frankfurt and in Berlin, have been signed during Q2 2023, with expected total gross proceeds of EUR 158 million. We have project number 1 currently in exclusivity. In addition to our effort to dispose development projects, we are also working on the sale of different yielding portfolio. For a new built residential portfolio of building, consisting of micro-living as regular rental, we have received an LOI, and we are currently in negotiation. Our NRW portfolio, more commonly referred to as a Cosmopolitan Portfolio, has been recently reoffered to the market, and the sales of our stake in BCP is currently ongoing.
Please join me on page 10 to update you on our operational performance. The quality of our portfolio remained high, with most of our assets in core in Berlin. Out of 26,000 units in our portfolio, 18,000 are located in the German capital. As per June 2023, the average fair value of our standing portfolio stood at 2,731 EUR per square meter. Let's move on the next page. The like-for-like fair value decrease amounted to 8.1% at the end of the second quarter, compared to full year 2022. As mentioned before, our low-yielding portfolio has been most impacted by the new interest environment in which we find ourselves with -8.6% revaluation compared to a -5.2% revaluation for the remainder of our portfolio.
For H2, we anticipate this direction of travel to continue, albeit at a slower pace, and foresee a valuation decline in the magnitude of a single-digit % number. During the same period, vacancy remained low at 1.4%, despite a slight increase of 0.1% during H1, but remaining in line with the 1.3% posted on December 31, 2022. This is also similar to the level of a year ago, when vacancies stood at 1.6%. Please join me on page 12. In the first quarter, we have realized a total like-for-like rental growth of 3.1% compared to 2.3% a year ago. There are a number of factors impacting our retail growth. 1.8% decline originated from new vacancy.
This concerns units that were renting a year ago, but that are currently vacant. 2.2% increase relate to vacancy reduction compared to last year, of which 1.7% stem from units where CapEx was exercised upon term. 0.4% rental growth come from relating at market rent, of which 0.2% from units with CapEx investment. Finally, 2.3% is attributable to indexation of existing contracts. All in all, if we exclude the effect of new vacancy, we could say that rental growth would have been 4.9%. With this, our average rent was EUR 7.69 per sq m per month at the end of Q2, +2.9% higher compared to EUR 7.47 a year ago. Let's continue on page 13, where we take a look at anticipated rent increase for H2.
For the second half of 2023, we anticipate a total rent increase of 4.5%-5% on the back of high reversion and potential for our portfolio. This growth can be easily geographically split in +4.3% for our Berlin portfolio and +6.2% for our other portfolio in Germany. Out of the total anticipated remaining rent increase of approximately 4.7, we have already communicated to our tenant regarding the first 3%. The remainder, we have ideally to realize with increases, which are more back-end loaded. All in all, this underpinning the high quality of rental growth potential of our portfolio. I would now like to hand over to Thomas, who will update you on our financial performance on page 15.
At the end, the second quarter of 2023, we had a portfolio of across EUR 4.8 billion worth of yielding assets, as well as approximately EUR 1.7 billion worth of GAV in development projects. Given the fact that we anticipate the sale of the 63% stake in BCP, held by our subsidiary, Adler Real Estate, we continue the classification of all these assets and their associated liabilities as assets and liabilities held for sale. As such, our EUR 6.1 billion total GAV excludes EUR 1.2 billion for BCP. During the second quarter of the year, the portfolio has seen continued impact of downward revaluations against the backdrop of rising interest rates.
This has resulted in a revaluation loss of EUR 437 million on the yielding portfolio, equivalent to an 8.1% like-for-like value decrease, and an additional revaluation loss of EUR 244 million on the development project. Furthermore, we have closed the sale of Arthur-Hoffmann-Straße in April, and we have signed the sale of two projects in Offenbach and Berlin during Q2 2023. These two effects decrease our development exposure from EUR 2.1 billion at the end of the first quarter to EUR 1.7 billion as for H1. Now, please join me on page 16. During Q2 2023, we have first repaid the EUR 500 million bonds at the end of April. Second, completed the tender offer for the EUR 300 million Adler Real Estate 2024 bond.
Third, we have successfully refinanced other maturities at Adler Real Estate level to an amount of EUR 177 million, including interest. Therewith, EUR 194 million of maturities remain in 2023. These maturities include the Adler Group convertible, maturing in November, and additional bank debt. This morning, we announced the potential refinancing of the EUR 165 million convertible bond and EUR 25 million Schuldschein loan at Adler Group level. With a EUR 191 million new payment in kind secured 1.5 billion note. On the next page, I will explain more about the actions we plan to execute. In addition to this new financing, we will continue capital recycling measures, including additional disposals and further refinancing efforts. Let's turn to page 17, where I will explain more about the refinancing.
We are planning to refinance the existing EUR 165 million convertible bond, of which EUR 63 million is located at a subsidiary of Adler Real Estate, and the promissory note, which note mature in November. To do so, we have announced to place a EUR 191 million new payment in kind senior secured 1.5 Lien note. In that regard, we have also announced a tender offer for the existing convertible bond for two reasons. First, to provide investors with additional liquidity, and second, to optimize our debt structure, reducing the number of outstanding instruments with the same purpose and timing to only one financing instrument. Please note that this tender offer is conditional of sufficient settlement of the announced new financing. Let's continue on page 18 to talk about the evolution of the LTV.
The EPRA LTV of the group increased to 87.7% compared to 75.4% at the end of last quarter. The increase between Q1 2023 and Q2 2023 is mostly explained by: first, the sale of two yielding assets, privatization, and one development project, which are closed during Q2, which have had a slightly offsetting effect. Second, revaluation of yielding assets as well as development projects, which is the main driver of the increase in leverage. Third, the drawdown of the new money funding and other financing items, including the refinancing of maturities in Q2, interest payment, and debt amortization. Fourth, CapEx relating to development projects, and fifth, other items, including operational income and extraordinary advisory fees relating to the restructuring. Please allow me to remind you that the EPRA LTV deviates from the covenant LTV definition in our bonds.
This covenant is temporarily lifted and will be tested for the first time on December thirty-one, 2024. Let's have a look at the debt KPIs on the next page. Our gross debt position slightly increased to roughly EUR 6.8 billion at the end of Q2 2023, compared to the end of the first quarter. The higher gross debt position results from the new money funding that has been drawn in Q2, offset mainly by the repayment of the EUR 500 million Adler Real Estate 2023 bond and tender offer of the EUR 300 million Adler Real Estate 2024 bond. As a result of the approved restructuring plan, we have a full secured financing structure, of which 31% relates to secured bank debt, with the remaining primarily related to the restructuring.
You can find more details on the different security level layers on the slide. When it comes to the cost of debt, the average cost of debt has increased to 5.5% on the back of the 12.5% interest rate related to the new money funding. Our total debt position has been fixed and hedged with an average maturity of 3.2 years. Allow me to remind you that under the restructuring plan, our bond covenants have been temporarily lifted. Let's move now to page 20. We have a stable cash position of EUR 231 million at the end of Q2 2023, which is slightly below the EUR 235 million we held at the end of last quarter.
Please let me remind you that the EUR 231 million excludes EUR 213 million of cash held at BCP level, which is classified as assets held for sale at group level. With that, we would get to a position of EUR 444 million cash at hand per 13th of June, 2023, including the remaining new money funding, which was drawn on 26th April, 2023, and after the repayment of the two bonds. Sorry. There have been three main factors affecting the cash position during the second quarter of 2023. First, the positive total financing cash flow of EUR 81 million.
This includes, among others, the repayment of the two Adler Real Estate bonds, the drawdown of the new money facility, additional liquidity from the refinancing of other maturities of EUR 60 million, interest payments of EUR 29 million, and smaller and other smaller repayments and amortizations. Second, we spent EUR 36 million in CapEx, which relates to the ongoing development project at the Consus level. And third, lastly, we have paid EUR 65 million in connection with the restructuring and related fees. The remaining net cash flow of EUR 12 million mostly relates to operational cash flow and the partial payment on a receivable. Thierry, now back to you.
Thanks, Thomas. We would like to end this presentation with some concluding remarks. We have made an important step towards the stabilization of our group with the completion of the restructuring plan. As a result of the restructuring effort, we have an increased average interest rate of 5.5%, much of which has shifted to payment in kind. Rödl & Partner has commenced as Adler Real Estate auditors. With regard to the audit of the 2022 financial statement of the group, we have constructive discussion with the local Luxembourg auditor that would be in charge of the overall audit and local audit firm about the so-called component audit. In the second quarter, we have closed the sale of one development project and signed the sale of two other development projects.
Currently, we are continuing our effort both in the sales of our development projects as well as to yielding portfolio and our stake in BCP. We have, we have had a stronger operational performance in Q2 with a 3.1%, like-for-like rent increase year-on-year. Operational vacancy of the total portfolio continue to be structurally low level at 1.4%. We had a stable liquidity position with EUR 231 million cash at hand at the end of the quarter. We have experienced a -8.1% like-for-like revaluation of the yielding portfolio in the first half of the year on the back of the new interest rate environment. Last, lastly, we can confirm our NRI guidance provided in the previous quarter.
The resulting NRI guidance remains for 207 million to 219 million EUR for full year 2023. These, however, will depend on the sale of a yielding portfolio in Berlin and the rental growth achieved in H2 2023. With that, we would like to conclude this presentation and open the floor for any question we may have.
Ladies and gentlemen, at this time, we will begin the question and answer session. Anyone who wishes to ask a question may press star followed by one on their touchtone telephone. If you wish to remove yourself from the question queue, you may press star followed by two. If you're using speaker equipment today, please lift the handset before making your selections. Anyone who has a question may press star followed by one at this time. One moment for the first question, please. And the first question comes from Wolfgang Felix from Sarria. Please go ahead.
Hello. Sorry, I had the mute on. Thank you very much. Congratulations to the restructuring. I've got just three questions. On the timing of the squeeze out of the Adler Real Estate shares, if you can maybe tell me roughly how you're anticipating that. The NRI lift of 4.5%-5% for H2. I was wondering, is this a bit of a catch up, or does this have to do more with perhaps exiting the accord in Berlin as regarding rent rises with the city? Or is this something that we should be expecting going forward as well? And third, on the devaluation of the yielding portfolio, would there be more to come?
Depending on methodology you've used, are you sort of looking at backwards to an average of the interest rate? Or, do you think that's been that and you're not anticipating any further devaluations going forward? Thank you. That's all.
So thanks for those questions, Wolfgang. I will take over the first question with respect to the timing on the squeeze out. So the squeeze out has been approved by the AGM, and now it's the normal thing that it is at court, and after the court decided on the legal clauses, so then the squeeze out will be finalized and will be then close to the trade register as well. About timing on that, we depend on the decision of the court, but this is normally fast route court decisions, so we expect it soon, maybe in October this year. Second and third question, I guess Thierry will answer on this.
Yeah, on the rent increase, we have updated our guidance, which was from 3%-4% - 4.5%. Because taking into account, after the restructuring plan, the different interests of our stakeholder, including our tenant, but including also our financing partner and our shareholder, we have decided to step out of the Berlin Affordable Alliance, where there was a limitation on the rent increase to be passed. So in doing so, we have been able to move our rent increase from 3%-4% to 4%-5%. Of course, we will continue to take care of the impact on the rent increase on our tenants.
So this is what we expect for this year. And of course, if you look the average rent we have in the portfolio compared to the market rent, we have potential to continue further this increase, especially in Berlin. In regard to evolution of the valuation, the market participant have communicated their result with a range between 7% and 8% decrease. This is of course difficult with this, how will be the evolution for the remaining part of the year. But what the observer, what the different market participants have communicated, they anticipate more still value reduction, but at lower speed of the first part of the year.
Because, of course, there's a component of the interest rate, which affect the valuation, but there's also the rent increase, and there's also the demand for flat, which still remain stronger.
Okay, thank you very much.
Thank you, Wolfgang.
The next question comes from Noor Sehar from Eaton Vance. Please go ahead.
Hi, this is Noor. One question from my side. Can you please split out how many development assets have you sold since the start of the year, or have signed LOIs for, and what would be the net proceeds from them? I know you state the gross proceeds, but it would be helpful to understand what would be the net proceeds from them. And at what stage would you then start thinking about repaying the new money? That's it.
I think the first one.
Oh, yeah.
So, on the sales, on the development sales, we have announced EUR 160 million sales. And the net amount is going to be close to that because the amount of debt affected to that is limited. And we will continue further this year in selling development projects and yielding assets. And we are targeting an amount, a gross proceed of EUR 500 million.
So with respect to the repayment of the new money, so that needs to be handled also from the provider. By the repayment of the new money, depend also on the sale of development as the yielding portfolio, as you might know. And this for the time being, so we are not in stress there, because we, as you know, we have a make whole until April 2024. So regardless if we sell it now or even a little bit later with the year or beginning of next year, it doesn't matter, because we even have to pay this make whole one. But we are certain that we can get all these repayments in due time there.
Okay, thank you.
Thank you.
Ladies and gentlemen, as a reminder, anyone who wishes to ask a question may press star followed by one at this time. It seems there are no further questions. I hand back to Thierry Beaudemoulin for closing comments.
So thank you for your participation to this call today. We wish you a good start of the week, and then management will continue to work on our strategic planning in the coming weeks. We look forward to update you on the next quarter on our progress in improving the liquidity position of the company and accelerating the disposal. Thank you.