ments in 1974 - as a result of the energy
crisis-the long-term interest rate
attained an unprecedented high level for
the Netherlands in the year under report.
Thus, for instance, in August 1974 the
average real yield of the last three
Government loans was not less than
10.45%. Indicative of recent developments
ofthe interest level isacomparison between
the yearly averages of 1973 and 1974.
If this average for 1973 was no more than
7.92%, it was for the year under report
as much as 9.82%. Mid-September a
falling trend in interest rates on the
capital market was noticeable, which
trend was strengthened in the sub
sequent months by the deterioration of
the world economy. At the end of 1974,
interest rates had again reached a level
that was practically equal to that ofthe
beginning of the year.
Despite turbulent developments on the
interest front, we could attract sufficient
funds that were needed by us. Virtually
throughout the year under report we
were in the market with our mortgage
bonds, with interest-rates varying from 9
to 11 We covered our additional capital
needs by means of contracting private
loans. The same as in 1973, mortgage loans
were in active demand. It turned out that
the rise in interest rates hardly affected
them. In the year under report, mort
gages effected totalled ƒ500 million, while
redemptions accounted for an overall
amount of 282 million. Amounts held
back on mortgage loans totalled ƒ31.4 mil
lion at the end of the past year against
ƒ79.3 million at the end of 1973.
In 1974 our mortgage debtors continued
to meet their obligations.
The real estate sector
In the course of the year under report,
the construction of a few office projects
in the development sector was completed.
Two of these complexes were sold, the
running of another one was taken into
our own hands and is meanwhile largely
rented out. Two of the office premises
now in our portfolio are still unlet.
In accordance with our valuation
standards we have capitalised the interest
charges for 1974 burdening these projects.
On the basis of the present interest level,
it will be possible also to capitalise the
interest charges for 1975 and 1976. Never
theless, in view of the economic situation,
we have thought fit to make a provision
of 5.5 million for costs of unoccupied
ness, to the debit of profits for 1974.
We have been somewhat reticent in the
past year upon undertaking new develop
ment projects. A start was made with the
building of four dwellings projects and a
block of flats.
In cooperation with others the
construction of an industrial and commer
cial halls complex was undertaken. The
A.B.N./F.G.H. projekt B.V. made a start
with the development of three projects.
An aggregate amount of ƒ136.6 million
was invested in our own projects together
with projects which we are developing in
cooperation with third parties. At the end
of 1974 the amount invested by us in
projects on hand was ƒ160.6 million.
On April 1 1974 we founded the N.V.
Beleggingsmaatschappij Vastgoed ‘Agora’,
in which was incorporated 80% ofthe
property of the Nevamij B.V., which close
company is owned by our Company and
Bredero Vastgoed on a fifty-fifty basis. The
profit made with this transaction in the
Nevamij has, less corporation tax to be
paid, been accounted for in the books of
Nevamij.
Nevamij s property not incorporated in
Agora (about 20%) was added to our own
portfolio. On the other hand, partly from
our own property, partly from our joint-
venture with the Amfas Group, the Agora
portfolio was extended and completed.
We believe that we have thus, both as to
the size of the various projects and as to
the nature and location of them, created
