LEG Immobilien SE

LEG reported H1 net cold rent of EUR 473.4 million, with like-for-like rent growth of 3.7% and reported rent growth of 3.4%. Adjusted EBITDA increased 2.3% to EUR 368.1 million and the adjusted EBITDA margin was 77.8%. AFFO was EUR 110.5 million, down 12.7% year on year from EUR 126.6 million, and FFO I was EUR 230.5 million, down 4.4%. Portfolio valuation rose 0.7% or EUR 135 million, and LTV ended H1 at 45.5%, down from 47.6% a year earlier. For full year 2026, management reaffirmed AFFO guidance of EUR 220 million to EUR 240 million, FFO I guidance of EUR 475 million to EUR 495 million, and an adjusted EBITDA margin of around 78%; they also expect LTV to reach around 45% by year-end.

Lars von Lackum emphasized that LEG is “delivering on every dimension” it set out for the year, with rent growth, vacancy, EBITDA, AFFO, valuation, and leverage all tracking to plan. He framed the company as disciplined and selective on capital allocation, saying every euro should go where it earns the most, and reiterated that disposals should only happen when pricing reflects intrinsic value. His tone was confident and steady, but he acknowledged the difficult market backdrop, especially weak transaction activity, geopolitics, and higher rates.

Kathrin Köhling focused on the H1 financial bridge and balance sheet strength. She said AFFO of EUR 110.5 million was mainly affected by higher net cash interest, higher maintenance and CapEx, and lower subsidies in H1, but that H2 should benefit from around EUR 10 million in subsidies and lower investments. She also highlighted LTV at 45.5%, average interest cost of 1.82%, average debt maturity of 5.7 years, interest coverage of 4.0x, liquidity of more than EUR 450 million, and EUR 450 million of financing closed in H1 at an average maturity of 9.3 years and an average interest rate of 3.9%.

Analysts focused heavily on disposals, capital allocation, and whether share buybacks should become the preferred use of disposal proceeds. Management said buyer appetite exists but notarizations have been held back by market volatility, and that buybacks are a possible option if there are sufficient disposal proceeds after maintaining the dividend policy and reaching the 45% LTV target. Questions also probed the durability of subsidy assumptions, the difficulty of reaching the top end of rent guidance, and why LEG does not report NDV quarterly; management said subsidy visibility is good, the upper end of rent guidance is not the base case, and NDV is reported only in full-year figures.