Aroundtown Believes It Has Hit the Bottom on Write-Downs

Share Price Surges on Announcement

Aroundtown SA (AT1) has announced that it expects impairment losses to have peaked in the fourth quarter of 2022, sending its share price up by more than 12% in early trading on Tuesday.

Key Points

• Aroundtown expects write-downs to hit €350 million in Q4 2022.
• This brings total writedowns for the year to €900 million.
• The company said it has now "largely completed" its portfolio review.
• Analysts say the announcement is a "positive step" for Aroundtown.

The news comes as a relief to investors, who have been concerned about the impact of rising interest rates on Aroundtown's property portfolio.

Aroundtown is a German real estate investment company that specializes in buying and renting out office and residential properties in major European cities.

The company has been hit hard by the recent rise in interest rates, which has made it more expensive to finance its debt.

This has led to a reassessment of the value of Aroundtown's property portfolio, which has resulted in the writedowns.

Outlook

Analysts say that the announcement is a "positive step" for Aroundtown, as it suggests that the company is now "largely completed" its portfolio review.

This could provide some stability to the company's share price, which has been volatile in recent months.

However, analysts caution that Aroundtown is still facing challenges, including the rising cost of debt and the potential for a recession.