77. Investment Properties
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About this
Report
Chairman's
Foreword
Corporate
Management Report Appendices Governance
Consolidated Financial Company Financial
Statements Statements
Amounts in millions of euros
2018
2017
Cost
291
627
Accumulated depreciation and impairments
(98)
(334)
Net carrying amount as per January 1
193
293
Opening balance
193
293
Purchases
28
11
Sales
(22)
(30)
Transfer to held for sale
(52)
Depreciation
(8)
(8)
Impairments
(2)
(1)
Reversal impairment
2
Other
2
(20)
Closing balance as per December 31
193
193
Cost
259
291
Accumulated depreciation and impairments
(66)
(98)
Net carrying amount as per December 31
193
193
The fair value of the investment properties amounts to
EUR 208 million (2017: EUR 230 million). External valuations of
investment properties were performed by duly certified external
parties in accordance with RICS valuation standards or other
equivalent standards. Investment properties are valued, for
determining of fair value, based on the methodologies which are
most appropriate for that property. This includes the discounted
cash flow valuation method and the capitalisation method based
on net initial yields for comparable transactions.
Valuations
2018 2017
External valuations 100% 100%
Internal valuations 0% 0%
Most investment property is unique. There is often no active
market for similar properties in the same location and condition.
Appraisals of the different types of investment properties are
based on many parameters, which are derived from current
contracts and market information as much as possible. A certain
degree of judgment and estimation cannot be avoided.
Therefore, all investment property has been designated as level
3 in line with the fair value classification under IFRS 13. When
determining the fair value of investment property, the
parameters used include the following, depending on the type
of property: current and expected future market rent per m2,
current and expected future vacancy rates, location of the
property, the marketability of the property, the average discount
rate, the development budget, and any credit risks.
Annual Report 2018 - Consolidated Financial Statements
190
