35 Real Estate Inventories
The development business related to the acquisition refers to subsidized or independently financed condominiums that are under construction or have already been completed. These properties are not held with the aim of generating rental income or achieving increases in value within the meaning of IAS 40, but rather are developed and constructed to be sold at a later date.
These development projects are recognized depending on whether there is a customer contract for the residential units that are intended for sale. If this is not the case, a valuation in accordance with IAS 2 at the lower of amortized cost and net realizable value is performed due to the intention to sell, with a corresponding disclosure under real estate inventories.
Recognized real estate inventories in the amount of € 570.4 million (Dec. 31, 2019: € 358.3 million) mainly concern development projects. These are projects to construct residential units planned for sale that are currently being built or that have been completed but have not yet been sold. The item also includes undeveloped land that will be used for future project developments.