Annual Report 2019

Non-financial Performance Indicators

We also focus on non-financial operating performance indicators as drivers for our key financial figures and supporting control parameters.

Our business activities focus on our customers. We aim to offer them affordable homes that meet their needs together with housing-related services and reliable customer support. As a result, the fourth most meaningful performance indicator at overall Group level, in addition to the financial performance indicators, is the Customer Satisfaction Index (CSI). It is determined at regular intervals in systematic customer surveys conducted by an external service provider and shows the effectiveness and sustainability of our services for the customer. Our company’s economic success and, in particular, the success of our Value-add strategy are directly linked to the satisfaction level of our customers. We are aware of this fact and implement a wide variety of measures with the goal of improving our services in the interest of our tenants.

The organic rent increase refers to the increase in the monthly in-place rent for the residential portfolio that was already held by Vonovia twelve months previously, plus the increase in rent resulting from the construction of new apartments and the addition of stories to existing properties. The monthly in-place rent per square meter gives information on the average rental income from the rented properties. In particular, over the course of time, the average rent increase achieved in the rented properties can be derived from this figure.

The vacancy rate also shows the proportion of units in our own portfolio that are not rented and therefore generate no rental income. It can serve as an early-warning indicator, e. g. to identify non-marketable apartments.

The vacancy rate and the average rent are key drivers for the development of our key figures related to the management of rental income. Together with the CSI they serve as essential early warning indicators.

The number of units sold from Recurring Sales shows our ongoing efforts in the privatization business. In addition to this, we report the “Non-core” disposals.

The fair value step-up represents the difference between the income from the sale of a residential unit and its last recognized fair value. It shows the percentage increase in value for the company on the sale of a unit before further costs of sale.

Monthly In-Place Rent
The monthly in-place rent is measured in euros per square meter and is the current gross rental income per month for rented units as agreed in the corresponding rent agreements at the end of the relevant month before deduction of non-transferable ancillary costs divided by the living area of the rented units. The rental income from the Austrian property portfolio additionally includes maintenance and improvement contributions (EVB). The rental income from the portfolio in Sweden reflects inclusive rents, meaning that the amounts contain operating and heating costs. The in-place rent is often referred to as the “Nettokaltmiete” (net rent excl. ancillary costs such as heating, etc.). The monthly in-place rent (in € per square meter) on a like-for-like basis refers to the monthly in-place rent for the residential portfolio that was already held by Vonovia 12 months previously, i.e., portfolio changes during this period are not included in the calculation of the in-place rent on a like-for-like basis. If we also include the increase in rent due to new construction measures and measures to add extra stories, then we arrive at the organic increase in rent.
Rental Income
Rental income refers to the current gross income for rented units as agreed in the corresponding lease agreements before the deduction of non-transferable ancillary costs. The rental income from the Austrian property portfolio additionally includes maintenance and improvement contributions (EVB). The rental income from the portfolio in Sweden reflects inclusive rents, meaning that the amounts contain operating and heating costs.
Fair Value
Fair value is particularly relevant with regard to valuation in accordance with IAS 40 in conjunction with IFRS 13. The fair value is the amount for which an asset could be exchanged between knowledgeable, willing parties in an arm’s length transaction.
CSI (Customer Satisfaction Index)
The CSI is determined at regular intervals by means of systematic customer surveys and reflects how our services are perceived and accepted by our customers. The CSI is determined on the basis of points given by the customers for our properties and their neighborhood, customer service and commercial and technical support as well as maintenance and modernization management.
Vacancy Rate
The vacancy rate is the number of empty units as a percentage of the total units owned by the company. The vacant units are counted at the end of each month.