21. Investment properties
Investment properties are recognised at depreciated cost. As of 30 September 2017, investment properties totalling €126 million (30/9/2016: €163 million) were recognised. The development of these properties is shown in the following table.
€ million |
|
Investment properties |
Acquisition or production costs |
|
|
As of 1/10/2015 |
|
608 |
Currency translation |
|
1 |
Additions to consolidation group |
|
0 |
Additions |
|
1 |
Disposals |
|
−92 |
Reclassifications under IFRS 5 |
|
−27 |
Transfers associated with the property, plant and equipment |
|
−3 |
As of 30/9 – 1/10/2016 |
|
488 |
Currency translation |
|
1 |
Additions to consolidation group |
|
0 |
Additions |
|
2 |
Disposals |
|
−75 |
Reclassifications under IFRS 5 |
|
0 |
Transfers associated with the property, plant and equipment |
|
11 |
As of 30/9/2017 |
|
426 |
Depreciation |
|
|
As of 1/10/2015 |
|
390 |
Currency translation |
|
0 |
Additions, scheduled |
|
15 |
Additions, impairment |
|
1 |
Disposals |
|
−53 |
Reclassifications under IFRS 5 |
|
−17 |
Reversals of impairment losses |
|
−10 |
Transfers associated with the property, plant and equipment |
|
−2 |
As of 30/9 – 1/10/2016 |
|
324 |
Currency translation |
|
0 |
Additions, scheduled |
|
9 |
Additions, impairment |
|
2 |
Disposals |
|
−36 |
Reclassifications under IFRS 5 |
|
0 |
Reversals of impairment losses |
|
0 |
Transfers associated with the property, plant and equipment |
|
1 |
As of 30/9/2017 |
|
300 |
Carrying amount at 1/10/2015 |
|
218 |
Carrying amount at 30/9/2016 |
|
163 |
Carrying amount at 30/9/2017 |
|
126 |
The reduction by €37 million mainly results from the sale of various stores in Germany.
The fair values of these investment properties total €248 million (30/9/2016: €287 million). They cannot be determined on the basis of observable market prices. As a result, they are determined on the basis of internationally recognised measurement methods, particularly the comparable valuation method and the discounted cash flow method (level 3 of the 3-level valuation hierarchy of IFRS 13 [Fair Value Measurement]). This measurement is based on a detailed planning period of 10 years. Aside from market rents, market-based discount rates were used as key valuation parameters. The discount rates are determined on the basis of analyses of relevant real estate markets as well as evaluations of comparable transactions and market publications issued by international consulting firms. The resulting discount rates reflect the respective country and location risk as well as the property-specific real estate risk. In addition, project developments are considered to determine the best use.
Rental income from these properties amounts to €23 million, with finance leases accounting for €8 million of this total (2015/16: €37 million, thereof €11 million from finance leases). The related expenses amount to €15 million, with finance leases accounting for €6 million (2015/16: €21 million, thereof €9 million from finance leases). Expenses of €0 million (2015/16: €0 million) resulted from properties without rental income and, as in the previous year, did not relate to finance leases.
Restrictions on titles in the form of liens and encumbrances amounted to €0 million (30/9/2016: €5 million). As in the previous year, no contractual commitments for the acquisition of investment properties were made.