Eastnine lifts profit from property management to 8.520 million euros in third quarter
Key Facts
Eastnine's profit from property management rose to 8.520 million euros in the third quarter of 2026 from 8.222 million euros in the corresponding period of 2025, according to its quarterly report. The improvement came alongside an increase in quarterly net profit to 13.932 million euros from 9.645 million euros a year earlier. Rental income for the quarter, however, fell to 15.448 million euros from 15.531 million euros in the corresponding period. On a like-for-like portfolio basis, the company recorded revenue growth of 3.2% in the third quarter. Portfolio occupancy, excluding The Bridge tower, reached a company record of 97.2% at the end of September. The performance coincides with continued fit-out work on tenant premises in the tower, which has yet to reach full physical occupancy.
Eastnine said in its October disclosure that The Bridge was about 98% leased. Physical occupancy stood at 57% at the end of September, with fit-out work continuing to prepare premises for tenants. The property has about 55,300 square metres of lettable space, according to the acquisition completion statement. Its annual rental value is 18.2 million euros, according to the same statement. The company said the tower's leases were on triple-net terms and included annual rent adjustments linked to European inflation. The signed leases thus combine the letting of most of the space with an annual rental adjustment mechanism, while tenants continue to move into the property.
On the acquisition details, the quarterly report listed a purchase price of 241 million euros for The Bridge. This price reflected deductions for vacancies, rent discounts and tenant-specific adjustments. The company had announced in its transaction completion statement that the acquisition's underlying property value was about 285 million euros. Financing included a secured bank loan of 180 million euros from Erste Group, according to the completion statement. Eastnine also used existing cash to cover part of the acquisition financing. Proceeds from refinancing other properties were also used, alongside the bank loan and available cash, to finance the tower purchase.
Despite the improvement in quarterly earnings, current earnings capacity from property management per share fell to 0.27 euros as of 30 September 2026. That compares with 0.31 euros per share at the end of the previous quarter, on 30 June, according to the quarterly report. Discussing its nine-month performance, Eastnine attributed pressure on profit from property management to the sale of properties in Riga. It also cited higher energy costs among the factors weighing on that profit during the period. Other factors listed by the company included establishing an in-house management organisation in Poland, alongside work to bring the tower to full occupancy.
In presenting the metric used to estimate annual income, Eastnine stressed in its report that "earnings capacity is not an earnings forecast". The company defines the metric as a hypothetical picture of what could be generated annually based on the existing property portfolio and financing structure. At completion of the acquisition, it estimated that profit from property management per share would reach 0.36 euros once all the tower's tenants had moved in, based on the earnings capacity model. That estimate is contingent on tenants completing their move into the leased premises, under the assumption announced by the company when the transaction closed. Eastnine plans for The Bridge to be fully occupied in the fourth quarter of 2027. Before then, it is scheduled to publish its results for the 2026 financial year on 9 February 2027.