The conference must not be recorded for publication or broadcast. At this time, it's my pleasure to hand over to Gundolf Moritz, Head of Financial Communications. Please go ahead, sir.
Yeah, thank you, Moira, and good afternoon, everyone, and thank you for joining us here today for the Adler Group full year results 2023 analysts and investor conference call. As Moira said, my name is Gundolf Moritz, and I'm heading Financial and Corporate Communications for Adler Group. Along with me, we have Thierry Beaudemoulin, CEO, and Thomas Echelmeyer, CFO, who will now guide us through today's presentation. This presentation will be followed by a Q&A session, in which management will answer any questions you may have for investors and analysts. Please note that this call will be recorded and made available on the company's website, where you can also download today's presentation. With that, I would like to hand over now to Thierry. Thierry, please go ahead.
Thank you, Gundolf. I also welcome everyone who has joined us here today. Before we start, I would like to highlight that part of our agreement and commitment to all of our stakeholders, we are working on the issuance of audited, consolidated financial statements and annual accounts for the financial year 2022 and 2023 by end of September 2024. Therefore, please note that the numbers presented today concerns unaudited financial statements for 2024. Now, let's update on our restructuring plan. Over the past two years, our industry has faced insolvency situations, valuation pressure, project standstill, and restricted financing, coupled with a pressured transaction market. To address this challenge, we aim to stabilize our financial structure and improve operations. Our initial restructuring strategy focused on selling assets to repay debt.
Given the current market challenges that hinder asset sales at favorable prices, we are proactively adapting our approach. Our revised strategy is based on two pillars. First, a business plan to efficiently restructure challenging assets, and secondly, a comprehensive financial restructuring to ensure long-term stability. This would improve the company's cash position, stabilize its debt structure by postponement of maturity beyond 2026, 2027, and provide a sufficient equity position until maturity of Adler Group's prolonged debt, in order to provide a solid foundation for the group's going concern. Therefore, we, as management, have entered into constructive discussions with our creditors to facilitate negotiations about the refined restructuring plan. As announced this morning through ad hoc notification, we have reached a non-binding agreement on the restructuring with our bondholders. We are aiming for a lock-up agreement to be signed in due course.
Based on the progress so far and considering alternative option available, we take the view that a solution can be implemented until end of September 2024. It would create the condition necessary for going concern of the group. We will provide you further update on this topic as we progress during the course of 2024. Let's continue with a brief update on our strategy, page six. We have delivered good progress across all five of Adler Group strategic pillar, even though adverse market conditions in the German real estate market are lasting longer than expected. In this environment, I'm convinced it is fair to say that we perform well by staying aligned to our strategic pillar and objective. Let us take a brief look at each of the pillar. First, the portfolio strategy.
We are progressing in asset and development project disposal, yet at a slower pace, given the prolonged period of difficult market conditions. We are very proud that we have closed the sale of Wasserstadt Mitte Tankstelle, located in Berlin, following the recognizable achievement of the sales of 700-unit Berlin-based Wasserstadt Mitte rental portfolio, which was already reported in our Q3 2023 result. We have also signed an agreement for the disposal of one project, while three additional projects are in exclusivity. It shows our focus capability to continue disposing of assets and generating liquidity. We continue to execute orderly disposal of selected portfolio and development project in the short and medium term, and follow the path of our expected transition to a Berlin-centric portfolio with only limited development exposure, while further deleveraging our business. Second, asset management.
We have largely fulfilled our committed CapEx obligation on our forward sale and condominium development project. Other sizable CapEx commitment have been put on hold completely in line with that we previously communicated. Obviously, it goes without saying, we will continue maintenance and relating CapEx whenever necessary in order to maintain the value of our yielding asset. Third, financing strategy. In 2023, we secured new financing in a very challenging financial market environment. We have successfully addressed all our financial obligations due in 2023, while ensuring required liquidity for the group. At the moment, we have also initiated discussion with our bank in order to prolong the 2024 maturity, which are in advanced stage. The prolongation are expected to be agreed during H1 2024. Moreover, a non-binding agreement in principle on a restructuring with bondholder has been negotiated.
We expect a lock-up agreement to be signed and announced in due course. Fourth, corporate structure. In line with the announced simplification of our corporate structure, the squeeze-out process and delisting of ADLER Real Estate AG has been completed in October 2023. As a result, we have continued its external reporting, and legally, the company has been transformed into a GmbH. Furthermore, the squeeze-out process of Consus Real Estate AG has been initiated. The sales process for our stake in BCP is currently ongoing, and we are in the process of identifying the right buyer. We are confident that we will make significant progress in this regard by the end of this year. Fifth, corporate governance.
In the Q3 2023 result presentation, we mentioned the appointment of AVEGA Revision as auditor of the standalone and consolidated financial statements for the years 2022, 2023, for Adler Group S.A., to be published by end of September 2024. We are happy to share with you that all auditors are diligently and completely engaged in finalizing the audited financial statements for 2022 and 2023 in due time. Another recent key event was a change in the chairmanship of the Board of Directors. On 9 February 2024, Stefan Kirsten, who chaired Adler Group for two years and stabilized the company during a difficult phase, resigned due to health reasons. Stefan Brendgen, who was already an active member of the board, took over the role of chairman with immediate effect, to continue moving the group forward firmly in the right direction.
At the forthcoming AGM, Adler Group plans to appoint two new members to the board of directors, one successor for Stefan Kirsten and one for Thomas Zinnöcker, who will then leave as planned. Overall, the smooth transition in chairmanship and clear progress with the auditor exhibits our strong focus on maintaining elevated standard of corporate governance within the industry in current circumstances. We will keep you up to date on any relevant development. Let's move on to page 8. We are in particular proud that our residential rental portfolio continued to show strong operational performance in the fourth quarter of 2023. We achieved a like-for-like rental growth of 5.1%, which was driven mainly by indexation, and to a lesser extent, by further vacancy reduction. We benefit from the strongly increasing demand in the market, the good quality of our asset, and our strong presence in Berlin.
This translates into a very low vacancy of only 1.1% at the end of Q4 2023, further down from 1.6 in Q3 2023, and 1.3 in December 2022. The average rent rose to 7.6 EUR per square meter per month at the end of December 2023, a slight increase versus the previous year. This increment was achieved despite the sizable disposal of the Wasserstadt Mitte portfolio in Berlin, with 700 new builds. For the full year of 2023, we saw a negative valuation adjustment of -12.8% in our yielding portfolio. This was driven by a devaluation of 8.4% in the first half of 2023, and a devaluation of 4.8 in the second half of the year.
In our development portfolio, we saw a negative valuation adjustment of -6.3% for the full year 2023. This was driven by a devaluation of 12.8% in the first half, and a devaluation of 4% in the second half of the year. This shows that negative adjustments are slowing down in H2 2023. Moving on to financial performance. I'm glad that we were able to achieve our NRI guidance for the full year of 2023, which was also confidently communicated in the Q3 investor call. Our NRI was EUR 210 million. The decline compared to the full year of 2022 was mainly driven by the disposal of the eastern portfolio to Velero Partners, the Waypoint portfolio, the Wasserstadt Mitte portfolio, and some of the BCP portfolio.
Note that BCP contributes to the group's net rental income, even though it's accounting under asset and liability, held for sale within the balance sheet. However, that decrease was partially compensated by like-for-like rental growth of 5.1, realized on the remaining asset. FFO 1 from rental activity remained negative at -EUR 43 million, compared to EUR 87 million positive last year. This correspond to FFO one per share of -EUR 0.30, versus EUR 0.74 in 2022. This decline is mainly attributed to the increase of interest expenses due to our restructuring effort. In this context, it must be noted that the FFO one position include EUR 100 million of PIK interest in full year 2023.
Further, EPRA NRV stood at EUR 529 million, or EUR 3.4 per share at the end of 2023, compared to EUR 2.4 billion or 20.7 EUR per share at the end of 2022. This movement was mainly driven by the higher non-cash interest expenses resulting from the new money funding, the amendment of the Adler Group bond term, which results in a higher PIK interest cost, as well as negative revaluation of our portfolio. Compared to Q3 2023, EPRA LTV increased with 8.5% per percentage point to 96.6%, mainly due to the negative revaluation of our asset and significantly higher interest expenses. We will show more detail later in this presentation. The weighted average cost of debt was 6.3 at the end of 2023, 60 basis points higher compared to the third quarter.
This increase was driven by the placement of the 1.5 Lien refinancing note, with a PIK interest of 21% in October. We had EUR 377 million cash on our balance sheet, excluding cash held at BCP at the end of the financial year, 2023. We will do a deep dive into the development of our cash position later in this presentation. Moving to disposal and development. The volume of disposed GAV during 2023 was amount roughly to EUR 533 million. We made a repayment of EUR 270 million of associated Lien debt. Further worth mentioning, is the progress we made in the completion of our forward sale and condominium development project, such as the completion of Königsufer in Barockviertel and Quartier Bundesallee in Berlin, and the realization of the associated milestone payment.
In addition to that, the sale of a Berlin-based development project, Wasserstadt Teltow, was signed in December 2023 and closed in the first quarter of 2024, thereby generated EUR double-digit million net proceeds for the group. Moreover, the Offenbach project, which was signed in H1 2023, is expected to close in H2 2024. Additionally, the disposal of the Leipzig FourLiving, Cologne Apart, and Grand Central Düsseldorf projects are currently under exclusivity. Out of the three exclusivity, we understood from the city of Leipzig that the acquisition of the FourLiving project will be signed tomorrow on the 26th of April. Despite the sale of the mentioned asset, it's fair to say that against the backdrop of a substantially more difficult market environment, progress of the disposal is not advancing as fast as we would like it to be.
Let's proceed to portfolio and operational performance on page 10. As in prior presentation, assets owned by our BCP subsidiary are not included in our portfolio KPI, as we aim at selling our stake in BCP. As of December 2023, BCP owned 9,300 rental units, with a portfolio book value of more than EUR 900 million. Its portfolio has a large exposure to NRW and to cities like Leipzig, Bremen, Kiel, and Hannover. In full year 2023, the average rent for BCP asset amounted to EUR 7.2 per sq m, while the vacancies stood at 2.6%. For more detail on the BCP portfolio, please refer to BCP website, where you find both the 2023 annual report and the result presentation.
As communicated during the Q3 investor call, with the disposal of 700 units of the residential portfolio, among others, our residential portfolio comprise circa of 25,000 rental units, of which 18,000 units are located in Berlin. The value of our yielding portfolio has decreased by EUR 200 million, from EUR 4.4 billion in September 2023, to EUR 4.2 billion in December 2023, on the back of negative revaluation, translating it into an average fair value of EUR 2,472 per sq m. 86% of the GAV in our portfolio, EUR 3.6 billion in absolute figure, relate to our assets in Berlin, hence asserting our position of Berlin-focused yielding asset portfolio. Let's move on the next page, 11. In full year 2023, we experienced a like-for-like value adjustment of -12.8%.
This result for our semi-annual external portfolio appraisal with a revaluation result of -8.4% as per June 2023, and a revaluation result of -4.8% as per December 2023 on a like-for-like basis. The value of our yielding portfolio has been under more pressure compared to assets in other locations. This result in a like-for-like devaluation of 13.4% for the Berlin portfolio, compared to 8.9% devaluation for the remaining of the year, for the full year 2023. Additionally, this mathematically also led to further yield expansion for both our Berlin-based portfolio and the remainder of, of the portfolio. The growth of 60 basis points on the top of 2.8% in the last year is visible, leading to a rental yield of 3.4% of the Berlin-based portfolio at the end of 2023.
Likewise, rental yield for the remainder of the portfolio has increased by 0.6 percentage points, reaching 5.5% in full year 2023, compared to 4.9 at the end of 2022. Please join me on page 12 to discuss our rental growth in more detail. We are happy to report that the anticipated capture in rental growth was realized toward the end of Q4 2023. We achieved a like-for-like rental growth of 5.1% in December 2023, compared to 1.5% last year. This is a remarkable year-on-year increase of 3.6 percentage point, which exceed the majority of our peers in the German residential sector.
The four major factors driving our rental growth in 2023 include: First, there was 1.5% decline to new vacancy relating to units that were rented a year ago, but that are currently vacant. Second, a 1.8% increase, thanks to vacancy reduction compared to the last year. Third, on the back of relating at market trend, we achieved another 0.5% rental. And finally, clearly being the biggest driver, a 4.2% increase because of indexation of part of our existing contract. On a per euro basis, our average rent marginally increased to EUR 7.6 per square meters per month at the end of Q4 2023.
Considering the disposal of Wasserstadt portfolio with units rented at market price of around EUR 20, it's great to see that the rental growth on the remaining, albeit substantially bigger part of the portfolio, has kept our average rent similar to a year ago. Furthermore, on a like-for-like basis, we have realized an increase of EUR 0.35 per square meters, adjusted for recent disposal. Besides, please note that our operational vacancy rate has also dropped to 1.1% in December 2023, versus 1.3% last year, a record low level for Adler. A clear testament to the ongoing supply shortage on the rental market, especially in markets like Berlin. Now, I would like to hand it over to Thomas, which will update you on our financial performance on page 14.
Thank you, Pierre, and also a very warm welcome from my side. At the end of the fourth quarter of 2023, we had a portfolio of yielding assets with a GAV of approx EUR 4.2 billion and development project with a GAV of EUR 1.5 billion, adding up to a total GAV of EUR 5.7 billion. These numbers do not include the portfolio of BCP, which is considered as assets and liabilities held for sale, as we anticipate the sale of the 63% stake in BCP, held by our subsidiary, Adler Real Estate. Overall, GAV has been mainly impacted by the semi-annual negative valuation adjustment of both yielding assets and development projects by approx EUR 300 million, due to both the prevailing high interest rates in H2 2023, and weak transaction markets.
In like-for-like terms, compared to Q3 2023, the valuation adjustment of yielding portfolio was -4.8%, and the devaluation of development portfolio was 4%. There were other small impacts from disposals of yielding assets, disposal of development projects, and the reclassification of Wasserstadt Kornversuchsspeicher from a development project to a yielding asset after the completion of the construction work. Now, let's have a look at EPRA LTV on the next page 15. The EPRA LTV of the group increased to 97.6% in December 2023, compared to 89.1% in September 2023. This increment mainly includes: First, 5.8 percentage points due to semi-annual negative valuation adjustment of the entire yielding assets and development assets portfolio, including assets owned by BCP. Second, 1.4 percentage points due to paid and accrued interest expenses for Q4 2023.
Third, 4.5 percentage points because of EUR 30 million development CapEx, mainly associated with forward sales and condominium projects. Then, EUR 80 million cash out in advisory fees, partly relating to the ongoing restructuring measures, contributing 0.3 percentage points and additional 0.3 percentage points from tax payments amounted to EUR 17 million. And finally, 0.2 percentage points due to disposal activities in Q4 2023, including the sale of the Mannheim No. 1 development project and whole portfolio on BCP level. Please allow me to remind you that EPRA LTV deviates from the covenant LTV defined in our bonds. This covenant has been temporarily lifted and will be tested for the first time on December 31, 2024. With this, let us move to page 16. Adler Group S.A. secured new financing in a very challenging market environment.
Moreover, all maturities due in 2023 were addressed following the repayment of Adler Group's convertible, the promissory notes, and the loan on Benrather Gärten.... As communicated in our Q3 results, Adler Group Group have placed EUR 191 million of new payment-in-kind senior secured 1.5 Lien Notes in September 2023, in order to refinance the EUR 165 million convertible bond and a promissory note, or as it's called in German, Schuldschein, which both were set to mature in November. In Q4, the company repaid both Wilhelm Schuldscheine or SSDs of EUR 114 million and Benrather Gärten SSDs of EUR 50.5 million, aggregating to EUR 164.5 million project debt. Additionally, BCP repaid EUR 8 million of bank debt following the disposal of a portfolio in Hamm, North Rhine-Westphalia, in December 2023.
Next to that, in February this year, the company repaid the remaining outstanding amount of Adler RE 2017 to 2024 bond in the amount of EUR 3 million at maturity. Further maturities in 2024 consist almost entirely of asset-linked secured bank financing. We are confident to address these maturities by means of prolongation. Discussions with the respective lending banks are currently in advanced stages, and we expect to have agreements to be in place in the course of H1 2024 and are subject to the refined restructuring plan. As Thierry mentioned earlier, we have agreed on a non-binding agreement in principle on a restructuring with bondholders. We expect the lock-up agreement to be signed and announced in due course. Let's continue on page 17 to discuss the debt KPI.
Our nominal interest bearing debt position has improved to EUR 6.4 billion, through a net reduction of slightly more than EUR 100 million in Q4 compared to Q3. The lower gross debt position mainly results from the repayment of the project-related financing, as stated on the previous slide. When it comes to the cost of debt, the weighted average cost of debt has slightly increased to 6.3%, compared to 5.7% in Q3 2023, on the back of the issue of the EUR 191 million senior secured note with an elevated 21% PIK interest. Our total debt position has been fixed and hedged with an average maturity of two point seven years, not taking into account the envisaged prolongation of maturities as part of the refined restructuring framework we are working on.
The detailed maturity schedule is shown on the next page. Looking ahead to the 2024 maturities, as already stated, the majority of the maturities consist of asset-linked secured bank debt and are envisaged to be prolonged. We are already in advanced negotiations with banks for the prolongation of these loans. In short, we do not expect any major challenges in 2024. As explained earlier, Adler Group is currently undertaking proactive revisions of its restructuring framework, with a particular focus on stabilizing the debt structure by postponement of maturities beyond 2026, 2027. A non-binding agreement in principle on a restructuring with bondholders has been negotiated. We will provide you further updates soon as we progress on this topic. Let's turn to cash on the next page, 19.
At the end of Q4, our cash position stood at EUR 377 million, which is EUR 55 million less than the EUR 432 million we held at the end of Q3. The increased restricted cash position of EUR 105 million at the end of December 2023 was temporary, as a large proportion of it became available in January 2024. Please let me remind you that the EUR 377 million excludes EUR 42.5 million of cash held at BCP level, which is classified as assets and liabilities held for sale. There have been four major factors impacting the cash position during the fourth quarter of 2023. First, a cash inflow of approx EUR 70 million from the sale of development project Mannheim No. 1 and condominium sales.
Second, a positive inflow of EUR 189 million following the successful placement of EUR 191 million secured notes, as explained earlier. Thirdly, we repaid the Adler Group convertible bond, Adler Lux Finance SSDs, the Wilhelm SSDs, and Benrather SSDs. This contributed to a cash outflow of EUR 280 million. Finally, CapEx related to the ongoing development project at the Consus level decreased the cash position by EUR 30 million. The remaining net cash inflow of EUR 49 million was related to operating income, release of trapped cash, a reduction in financial receivables, and smaller items grouped under other. Additionally, the cash outflow of EUR 51 million mainly relates to extraordinary advisor fees, tax, and amortization and interest. Thierry, now back to you.
Thank you, Thomas. We would like to end this presentation with some concluded remark and summarize the most important milestone in addition to our guidance of our net rental income for 2023. Against the backdrop of a challenging market environment, we delivered a strong operational performance with 5.1% like-for-like rental growth compared to the previous year, and a low operational vacancy of 1.1%. We also have a stable liquidity position with EUR 377 million cash on our balance sheet at the end of 2023. Moreover, we successfully disposed the 700 rental unit Berlin-based portfolio, fully in line with our asset strategy, which has been among the largest and the most prominent real estate transaction in Europe in 2023, proving our focus capability in disposing assets.
Following certain disposal from our yielding asset portfolio in 2023, we expect to generate net rental income in the range of EUR 200 million-EUR 210 million in 2024. Additionally, AVEGA Revision has been appointed as the auditor of the standalone and consolidated financial statement for the year 2022 and 2023, which would leave us well positioned to be able to publish audited financial statements for the whole group by the end of September 2024. Finally, as I explained above, and to reiterate, as we embark on the year 2024, our overarching goal is to further stabilize the group. We have taken considerable steps to reinforce the group capacity by proactively revising the restructuring framework in order to provide a solid foundation for the group going concern. Therefore, we, the management, are entering into constructive discussion with our creditor to facilitate negotiation about the refined restructuring plan.
Based on progress so far, we are confident that this constructive discussion to facilitate negotiation about the refined restructuring plan can be implemented until the end of 2024, September 2024, thereby creating the condition necessary for going concern of the group. A non-binding agreement in principle on the restructuring with bondholder has been achieved. We will keep you informed on this topic. With that, we would like to conclude the presentation and open the floor for any questions you may have. Thank you all for your attention. Gundolf, I hand over to you for the Q&A.
Yeah, thank you, Thierry, and I'll hand over to Laura. Please, proceed with the Q&A.
We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their touchtone telephone. You will hear a tone to confirm that you've entered the queue. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use only the handset while asking a question. Anyone who has a question may press star and one at this time. The first question is from Felix Wolfgang from Sarria. Please go ahead.
Yes, thank you very much for reporting today, and congratulations for getting so far. It seems your conversations with your bondholder committee are progressing faster than we thought. Yeah, I just have three questions, please. First of all, is there still a however latent risk of shareholder action, say, back from 2019 or so? And, if there still is a risk, and what steps would that reduce? You know, I don't know to what extent maybe audit financials would play a role in that direction or how you see that going forward, if it's indeed still an issue. Then the second question was, you're saying the restructuring would leave you with more cash. Are you looking to hold more cash on your balance sheet?
Are you, are you looking to perhaps resume some of your developments? Or how should I interpret that, and what, what kind of sum are you perhaps ideally looking for without telling us too much, what it says on the term sheet now? And third, I just meant to ask if there's any, however distant, link between, say, your coordinating bondholders and any of the purchasers of these assets that you've been selling and are still looking to sell. Obviously, we've seen the city of Leipzig interested in your FourLiving project, but and here and there, other cities, et cetera, buying. But I just meant to exclude that there isn't too short a circuit between funds managed by your main bondholders. Thank you.
Thank you for your questions. So on the first question about shareholder litigation, so we are not aware of any shareholder litigation, so I can't comment on more on this topic. In our, let's say, revised restructuring plan, so we have just communicated our ad hoc, and of course, we will give you detailed update once the lock-up agreement is signed, and then we can have a follow-up on that. But in general, you see the level of cash of the company, and of course, our aim is to continue to improve our cash position with active management of the debt and active management of our asset sale on that.
In regard to asset sales, of course, we are in a challenging market with limited buyers, so we are actively pushing to sell our development portfolio and our yielding portfolio, either through, let's say, open process. So, of course, the city could be interesting of some of our assets, and Leipzig, I think, is a good example of a win-win situation for a project which we don't want to develop and the city wants to move forward. We are exploring if we can work with other city. After that, of course, any stakeholder could be interesting in other of our assets, and then we are running an open market process to make sure that we address all the concern of that.
But of course, this is something which we can communicate once the transaction is completed. Thank you.
Okay, thank you.
Okay, thank you, Moira. I understand that, we do have received questions via email, and I do have here two questions from Louis Hu from Morgan Stanley. The first probably goes to Thierry. Can you please comment on what you are seeing with regard to the disposals market? Also, can you give us more detail on the BCP sale? The second question I will read, probably for Thomas, what will be the net cash proceeds from the EUR 530 million assets sold after repayment of debt and all costs like taxes?
So on market, 2023 was historically low market with less than EUR 6 billion transaction, compared to an average of more than EUR 20 billion over the last 10 years. So very few transactions. First quarter of 2024 is also very low, a bit more than EUR 1 billion. We expect market to pick up in the second quarter, so I guess the level of activity in second quarter will be higher than the first quarter. Which buyer are active at the moment? Opportunistic buyer, which have value-added strategies. So and then you have core buyer, like the city, like some long-term investor, who take the opportunity of difficult market to pick up the best asset. So in my view, a key driver for acceleration, two factors.
So first, a stop of the value decrease, because as long as the value decrease, nobody wants to buy at the wrong price. So we are still expecting value decrease in the second part of the year. So this is one factor which hinders actors to transact. And second factor is, of course, the level of interest rate, because if you compare the yield of the residential company and the interest rate, you have negative leverage. So I think this is what we see in the market, stabilization in 2024 and picking up 2025, 2026. And of course, we are ready to accelerate in case the market is accelerating. So BCP, we have a stake in BCP. It's a non-strategic investment.
This is not an integrated company, so that's why we have mandating an investment bank for that. So we are currently in the process of marketing that, so we can't give guidance on where we are, but we expect to be able to close that before the end of 2024. And of course, as far as we are more advanced in the process, we will give you additional color on that. I think the next-
The next question-
Yeah.
With respect to the sales, if I get it right, we realized in 2023, so we had here the sales prices. The gross proceeds were EUR 530 million, and there were associated debt to this of EUR 270 million, so ends up to the net proceeds of EUR 260 million.
Okay, Moira, would you take over, please?
Yes, sir. The next question is from Emmanuel Arnold from Barclays. Please go ahead.
Hi, thank you for the presentation. Very quick question. Have you also entertained conversations with the, for example, the City of Berlin, as we seen the news in the past few days? And then another question is, and apologies if the answer is in the material, but unfortunately I'm on the road, and I couldn't have it in front of my eyes. Is there an order of magnitude for the transaction that you expect to sign with the city, if I understood correctly, of Leipzig, tomorrow? Thank you.
So as I mentioned, our strategy is to reduce our development exposure on one end, and also to reduce our debt. So of course, in the current market, we are discussing with all potential buyer, which of course includes the City of Berlin, but I think at this stage I can give more comment on that. Second point on the City of Leipzig, so we will communicate tomorrow the exact amount, so then you will get that. Thank you.
Wonderful. Thank you very much.
... So we do have received two further questions via email. One is from Hugo Squire, from Schroders. When will details of the proposed restructuring be made available to bondholders outside of vehicle? I think we have answered it already, but Thierry?
Yeah, I think we just at the stage where we are in our constructive discussion. So once we have reached a lock-up agreement, we will give more color on that. Thank you.
Another question from Nick, from Seventh Place: Do you think your development assets are now marked down to book values, where you can realistically sell most of them over the next one to two years?
So globally, as I mentioned, where we are in the market, we see a deceleration of the value decrease, huh? Compare the first part of 2023 was worse than the next part of 2023. We still expect valuation decrease for both yielding asset and development in the first part of 2024. And after, we expect stabilization and further. Of course, in a challenging market where you have less buyer, you have also more interest from investor for existing assets rather than development. Nevertheless, we believe that as residential is a key investment, that Germany need residential new build. We are also able to attract interest in our development project, because this is a unique source of pipeline to build your residential.
So I think these two factor will be a good foundation for us to continue to sell our development. So we will sell our project in Leipzig. We have sold a plot of land in Berlin recently. We have sold another joint venture also in Berlin, and we sold also a project in Mannheim. So I think we are progressing at a lower price than we expect, but we are progressing on that, and we expect to do more in 2024 in this regard. Thank you.
As a reminder, if you wish to register for a question, please press star and one on your telephone. Once again, to ask a question, please press star and one on your telephone. There are no more questions on the phone. I would now like to turn the conference back over to Thierry Beaudemoulin for any closing remarks.
So thank you for attending our full year result. So as you have seen, we have, in a challenging environment, deliver good operational performance, continue to progress on, on sale, streamline the company, and anticipating to, improve, our restructuring plan. So we will come back to you in the coming week to update you on this last matter. So thank you for your attention, and I wish you a good afternoon.
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