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Franco-Dutch property giant Unibail-Rodamco reported that the total value of its portfolio fell by EUR 1.7 bn in 2008, leading to a net loss of EUR 1.1 bn compared to a net profit of EUR 944 mln the year before.

Despite the recorded loss, the company's shares closed 3.56% up on Friday at EUR 107, as investors expressed relief that the leading real estate company in Europe had not seen the level of valuation declines experienced in the UK. They were also cheered by Unibail-Rodamco's forecast of strong growth in 2009.

Unibail-Rodamco said that its recurring earnings per share was up 8.4% to EUR 8.52 while the distribution per share was up 7.1% to EUR 7.50. CEO Guillaume Potrinal said: 'In a harsh economic climate, our recurring EPS exceeds the 2008 growth target. We achieved this thanks to a high quality asset base, conservative financing and hard working professionals.' The group has a property portfolio of EUR 24.6 bn, 74% of which comprises major shopping centres in key cities in Continental Europe. Offices is the second largest component (18%), with convention centres and exhibitions accounting for 8%.

While many property companies, particularly in the UK, are struggling with loan-to-value ratios ranging from anywhere between 65% -100%, Unibail-Rodamco said its LTV ratio stood at 30% for 2008. The company said it had a contained debt level with renewed EUR 2.4 bn of medium-to long-term financing in 2008.

Like-for-like rental income rose 8.5% to EUR 1.2 bn in 2008, with the rental growth for shopping centres up 7.7%. 'The high footfall shopping centres, a category of assets in which the group is the leader in continental Europe, are proving to be the most resilient in today's environment. The group's recurring earnings per share (EPS) grew by 8.4% in 2008, thanks to robust like-for-like rental growth (8.5%) and contained cost of debt,' the company said.

Fully diluted liquidation Net Asset Value per share was down 10.7% at EUR 151.20.

The focus for 2009 is on operational growth. The group will not start construction on new projects until targeted returns are achievable. 'Combined with the high quality portfolio, the group is confident to set a 2009 recurring EPS growth minimum target of 7% and a commensurate increase in 2009 distribution,' the company said.