State Real Estate with Record Business Revenues

State real estate achieved record business revenues from property management of 16.8 million euros last year, representing a growth of 7.6 percent compared to the previous year, the state-owned company reported on Wednesday.

Highlighting successful management of the portfolio of apartments and commercial spaces, the company also reported total revenues of 20.8 million euros last year, with a 19 percent annual increase, while net profit amounted to around four million euros.

They state that the revenue growth is a result of increased efficiency in managing receivables and collections, an expanded portfolio, and the recognition of part of the income from real estate investments through EU funds.

In 2023, the company realized record current and investment expenditures of 8.6 million euros, which significantly improved the value of real estate, they emphasize. The mentioned investments, including the renovation and equipping of 125 apartments for the temporary accommodation of citizens affected by the earthquake, simultaneously influenced a 40 percent increase in total expenses compared to 2022, along with the effects of inflation on service and utility costs and a significant increase in the number of properties under management, according to State Real Estate.

Under state management, more than 12 thousand properties

During the past year, the company signed 337 lease agreements for commercial space and apartment rentals. The number of tenders and commercial spaces offered to the market has increased, with nine tenders announced for leasing and 201 commercial spaces offered across Croatia. The total value of all active lease agreements at the end of 2023 amounted to more than 75 million euros, reported State Real Estate.

They also note that the company’s real estate portfolio has significantly increased following the enactment of the Law on the Management of Real Estate and Movable Property Owned by the Republic of Croatia, and the company is currently managing more than 12 thousand properties as of June.

The law, along with a 45 percent increase in the real estate portfolio, also brought an expansion of work tasks regarding sales and disposals, and the company has taken on more than three thousand new cases. All of this was preceded by the reorganization and systematization of the company, staffing enhancements, and the definition of new business processes, all aimed at starting new tasks as early as 2024, according to State Real Estate.

– We successfully managed real estate in 2023, and buoyed by these results and our previous work, we entered 2024 optimistically and rapidly in light of the new requirements of legal provisions under which, in addition to our existing work, we also handle sales and disposals. We expect that along with the planned 200 commercial spaces we are offering for lease this year, we will also prepare the first 50 properties for sale and disposal – said Mirela Habijanec, a member of the management board and director of State Real Estate in a statement that was conveyed in the press release.