Annual Report
For the financial year 1 January - December 31, 2023
Urban Partners A/S
Cvr. nr. 29168709
Southamptongade 4
2150 Nordhavn
The Annual Report was presented and
adopted at the Annual General meeting on
the 11
th
June 2024
Page 2 of 65
Contents
MANAGEMENT’S STATEMENT ..................................................................................................................................................................... 3
INDEPENDENT AUDITOR’S REPORT ........................................................................................................................................................... 4
COMPANY INFORMATION ............................................................................................................................................................................. 6
MANAGEMENT REVIEW ................................................................................................................................................................................ 8
INCOME STATEMENT ................................................................................................................................................................................. 16
BALANCE SHEET ......................................................................................................................................................................................... 17
STATEMENT OF CHANGES IN EQUITY ...................................................................................................................................................... 18
STATEMENT OF CASH FLOW ..................................................................................................................................................................... 20
NOTES TO THE FINANCIAL STATEMENT ....................................................................................................................... 21
1. Revenue ..................................................................................................................................................................................... 21
2. Staff expenses ......................................................................................................................................................................... 22
3. Financial Income ................................................................................................................................................................... 23
4. Financial expenses ................................................................................................................................................................ 23
5. Income tax ............................................................................................................................................................................... 24
6. Intangible assets ................................................................................................................................................................... 25
7. Property, plant and equipment ....................................................................................................................................... 28
8. Leases ........................................................................................................................................................................................ 30
9. Investments in subsidiaries ............................................................................................................................................... 32
10. Partially owned subsidiaries ............................................................................................................................................ 34
11. Business Combinations ....................................................................................................................................................... 35
12. Investments in Joint Ventures .......................................................................................................................................... 36
13. Investments in associates .................................................................................................................................................. 37
14. Other financial assets .......................................................................................................................................................... 38
15. Receivables .............................................................................................................................................................................. 40
16. Prepayments / Other current financial assets .......................................................................................................... 40
17. Share base payment ............................................................................................................................................................. 41
18. Share capital ........................................................................................................................................................................... 42
19. Minority interests ................................................................................................................................................................. 43
20. Proposed distribution of profit, Parent ........................................................................................................................ 43
21. Financial assets and liabilities ......................................................................................................................................... 43
22. Financial risk management .............................................................................................................................................. 47
23. Related parties ....................................................................................................................................................................... 50
24. Contingent assets, liabilities and other financial obligations ............................................................................. 52
25. Audit Fee .................................................................................................................................................................................. 52
26. Provision ................................................................................................................................................................................... 53
27. Subsequent event .................................................................................................................................................................. 53
28. General Information ............................................................................................................................................................ 53
29. Basis of Preparation ............................................................................................................................................................ 53
30. Accounting Policies for the Group .................................................................................................................................. 53
31. Critical accounting estimates and judgements ......................................................................................................... 63
32. Accounting policies for the Parent Company ............................................................................................................. 64
Page 3 of 65
Management’s statement
The Executive Board and Board of Directors have today considered and adopted the Annual Report of Urban Partners A/S
for the financial year 1 January to 31 December 2023.
The Consolidated Financial Statements have been prepared in accordance with IFRS Accounting Standards as adopted by
the EU and further requirements in the Danish Financial Statements Act and the Parent Company Financial Statements
have been prepared in accordance with the Danish Financial Statements Act. The Management's Review has been
prepared in accordance with the Danish Financial Statements Act.
In our opinion, the Consolidated Financial Statements and the Parent Company Financial Statements gives a true and fair
view of the financial position at 31 December 2023 of the Group and the Parent Company and of the results of the Group
and Parent Company operations and consolidated cash flows for 1 January to 31 December 2023.
In our opinion, Management’s Review includes a true and fair account of the development in the operations and financial
matters of the group and the Parent Company, of the results for the year and of the financial position of the Group and
the Parent Company.
We recommend that the Annual Report be adopted at the Annual General Meeting.
Nordhavn, 11
th
June 2024
Executive Board
Claus Schei Mathisen Xavier Himmer
Board of Directors
Mikkel Bülow-Lehnsby Jim Hagemann Snabe
Chairperson Vice Chair
Morten Beck Jørgensen Rasmus Nørgaard
Celia Francis
Page 4 of 65
Independent Auditor’s report
To the Shareholders of Urban Partners A/S
Opinion
In our opinion, the Consolidated Financial Statements give a true and fair view of the Group’s financial position at 31
December 2023 and of the results of the Group’s operations and cash flows for the financial year 1 January to 31
December 2023 in accordance with IFRS Accounting Standards as adopted by the EU and further requirements in the
Danish Financial Statements Act.
Moreover, in our opinion, the Parent Company Financial Statements give a true and fair view of the Parent Company’s
financial position at 31 December 2023 and of the results of the Parent Company’s operations for the financial year 1
January to 31 December 2023 in accordance with the Danish Financial Statements Act.
We have audited the Consolidated Financial Statements and the Parent Company Financial Statements of Urban
Partners A/S for the financial year 1 January - 31 December 2023, which comprise income statement, balance sheet,
statement of changes in equity and notes, including material accounting policy information, for both the Group and the
Parent Company, as well as statement of comprehensive income and cash flow statement for the Group (“the financial
statements”).
Basis for Opinion
We conducted our audit in accordance with International Standards on Auditing (ISAs) and the additional requirements
applicable in Denmark. Our responsibilities under those standards and requirements are further described in the
Auditor’s Responsibilities for the Audit of the Financial Statements section of our report. We are independent of the
Group in accordance with the International Ethics Standards Board for Accountants’ International Code of Ethics for
Professional Accountants (IESBA Code) and the additional ethical requirements applicable in Denmark, and we have
fulfilled our other ethical responsibilities in accordance with these requirements and the IESBA Code. We believe that
the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Statement on Management’s Review
Management is responsible for Management’s Review.
Our opinion on the financial statements does not cover Management’s Review, and we do not express any form of
assurance conclusion thereon.
In connection with our audit of the financial statements, our responsibility is to read Management’s Review and, in
doing so, consider whether Management’s Review is materially inconsistent with the financial statements or our
knowledge obtained during the audit, or otherwise appears to be materially misstated.
Moreover, it is our responsibility to consider whether Management’s Review provides the information required under
the Danish Financial Statements Act.
Based on the work we have performed, in our view, Management’s Review is in accordance with the Consolidated
Financial Statements and the Parent Company Financial Statements and has been prepared in accordance with the
requirements of the Danish Financial Statements Act. We did not identify any material misstatement in Management’s
Review.
Management’s Responsibilities for the Financial Statements
Management is responsible for the preparation of Consolidated Financial Statements that give a true and fair view in
accordance with IFRS Accounting Standards as adopted by the EU and further requirements in the Danish Financial
Statements Act and for the preparation of Parent Company Financial Statements that give a true and fair view in
accordance with the Danish Financial Statements Act, and for such internal control as Management determines is
necessary to enable the preparation of financial statements that are free from material misstatement, whether due to
fraud or error.
In preparing the financial statements, Management is responsible for assessing the Group’s and the Parent Company’s
ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going
concern basis of accounting in preparing the financial statements unless Management either intends to liquidate the
Group or the Parent Company or to cease operations, or has no realistic alternative but to do so.
Page 5 of 65
Auditor’s Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from
material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion.
Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with
ISAs and the additional requirements applicable in Denmark will always detect a material misstatement when it exists.
Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could
reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
As part of an audit conducted in accordance with ISAs and the additional requirements applicable in Denmark, we
exercise professional judgement and maintain professional scepticism throughout the audit. We also:
• Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or
error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is
sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement
resulting from fraud is higher than for one resulting from error as fraud may involve collusion, forgery,
intentional omissions, misrepresentations, or the override of internal control.
• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are
appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the
Group’s and the Parent Company’s internal control.
• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and
related disclosures made by Management.
• Conclude on the appropriateness of Management’s use of the going concern basis of accounting in preparing
the financial statements and, based on the audit evidence obtained, whether a material uncertainty exists
related to events or conditions that may cast significant doubt on the Group’s and the Parent Company’s ability
to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw
attention in our auditor’s report to the related disclosures in the financial statements or, if such disclosures are
inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date
of our auditor’s report. However, future events or conditions may cause the Group and the Parent Company
to cease to continue as a going concern.
• Evaluate the overall presentation, structure and contents of the financial statements, including the disclosures,
and whether the financial statements represent the underlying transactions and events in a manner that gives
a true and fair view.
• Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business
activities within the Group to express an opinion on the Consolidated Financial Statements. We are responsible
for the direction, supervision and performance of the group audit. We remain solely responsible for our audit
opinion.
We communicate with those charged with governance regarding, among other matters, the planned scope and timing
of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during
our audit.
Hellerup, 11
th
June 2024
PricewaterhouseCoopers
Statsautoriseret Revisionspartnerselskab
CVR No 33 77 12 31
Thomas Wraae Holm
Qasam Hussain
State Authorised Public Accountant
State Authorised Public Accountant
Mne30141
Mne44159
Page 6 of 65
Company information
The Company Urban Partners A/S
Subname: NREP A/S
Southamptongade 4
DK-2150 Nordhavn
Website: www.urbanpartners.com
CVR No: 29 16 87 09
Financial period: 1 January - 31 December
Incorporated: 2 November 2005
Financial year: 18th financial year
Municipality of reg. Office: Copenhagen
Board of Directors Mikkel Bülow-Lehnsby, Chairman
Jim Hagemann Snabe, Deputy Chairman
Morten Beck Jørgensen
Rasmus Nørgaard
Celia Francis
Executive Board Claus Schei Mathisen
Xavier Himmer
Auditors PricewaterhouseCoopers
Statsautoriseret Revisionspartnerselskab
Strandvejen 44
DK-2900 Hellerup
Lawyers Bruun & Hjejle
Nørregade 21
DK-1165 København K
Bankers Danske Bank A/S
Strødamvej 46
DK-2100 København Ø
Page 7 of 65
Financial highlights – 5 years
Seen over a five-year period, the development of the group is described by the following financial highlights:
Group
tDKK
2023
2021
2020
2019
Profit/loss
Revenue
1,401,680
752,679
720,153
337,033
Operating profit/loss
1
655
344,390
359,351
197,198
Profit/loss before financial income &
Expenses
(414,583)
68,459
90,370
35,990
Net financials
10,106
(5,080)
(11,779)
2,495
Net profit/loss for the year
(394,581)
82,148
90,152
50,323
Balance sheet
Balance sheet total
1,451,994
1,178,705
931,959
403,089
Equity
106,981
712,985
637,286
191,568
Cash flows
Cash flows from:
- Operating activities
196,490
(139,572)
173,115
35,093
- Investing activities
10,674
(171,183)
(91,447)
(13,454)
- Including investment in property,
plant and equipment
(5,715)
(6,454)
(1,649)
(12,288)
- Financing activities
(167,458)
(20,617)
361,053
(6,012)
Change in cash and cash equivalents
for the year
39,706
(331,372)
442,721
15,627
Average number of employees
697
385
230
151
Ratios
Gross margin
1
0.1%
45.8%
49.9%
58.5%
Profit margin
(29.6%)
9.1%
12.5%
10.7%
Return on assets
(28.6%)
5.8%
9.7%
8.9%
Solvency ratio
7.4%
60.5%
68.4%
47.5%
Return on equity
(94.2%)
12.2%
21.8%
30.3%
The ratios have been calculated in accordance with the recommendations of the Association of Danish Financial
Analysts. The ratios are defined as follows:
Gross margin
Operating profit/loss x 100
Revenue
Profit margin
Profit before financials x 100
Revenue
Return on assets
Profit before financials x 100
Total assets
Solvency ratio
Equity at year end x 100
Total assets at year end
Return on equity
Net profit for the year x 100
Average equity
1
In 2023 and 2022 staff expenses are presented as part of operating income, which impact the gross margin negatively compared to
previous years.
Page 8 of 65
Management review
Key activities
Urban Partners (the “Group”) is a platform of vision-
aligned, differentiated, investment strategies shaped
around urban problem solving. The Group exists to power
the progress of cities and citizens by investing to help
solve the most pressing urban problems by uniting
insights, stakeholders, and capital within the urban
ecosystem. The aspiration is to deliver a long-term
positive impact alongside attractive returns.
Urban Partners was founded in 2005 as Nordic Real
Estate Partners (Nrep) to improve the built environment
and is grounded in a solid track record of execution and
trust with urban stakeholders and investors. As
accelerating urbanization has put cities at the forefront of
our greatest social, economic, and environmental
challenges, Urban Partners has extended our impact over
time to tackle these issues holistically and individually
through our strategies – investing in sustainable urban
tech solutions through 2150, and providing financing
solutions to advance the green transition through Velo
Capital. Nrep remains our ESG-focused real estate
investor at scale, and these three strategies make up our
vision-aligned investment platform with the name Urban
Partners, launched in 2023. Together, we bring real
solutions to real urban challenges – making cities a
benefit, not a burden, for people and the planet.
Urban Partners has investments across 8 countries and
more than DKK 152 billion under management across the
three investment strategies that work independently
based on a shared set of core values, towards the same
vision of a future in which the urban environment
universally contributes to the wellbeing of humanity and
the welfare of the planet:
• NREP is a real estate investor committed to
driving real change in the industry with a holistic
ESG focus. With a successful track record, NREP
is known for its ability to reimagine the built
environment, including several large-scale
neighbourhood developments. NREP manages
one of Europe’s largest real estate funds and
runs a platform with over 8 million square
meters across eight countries. NREP has
approximately EUR 19 billion (DKK 141.7 billion)
assets under management across 10 funds. The
company’s carbon pledge is one of the most
progressive in the industry with a target of
becoming Net Zero by 2028.
● 2150 is a venture capital firm investing in the
sustainable reshaping of the broad urban
environment. 2150 backs entrepreneurs working
at the forefront of the green transition and helps
scale the companies and technologies with long-
term equitable impact across the whole ‘urban
stack’, including how cities are built, designed,
constructed, and powered, to the way people live,
work and are cared for. 2150 has successfully
established two tech funds and is in the process
of raising additional capital for Tech fund II. Assets
under management amounts to approximately
EUR 360 million (DKK 2,685 million).
● Velo Capital provides flexible real estate credit
solutions, helping its customers focus on
sustainable assets. With 10 years of alternative
real estate credit track record, Velo oversees
three active funds with approximately EUR 1
billion (DKK 7.5 billion) asset under management,
focusing on real estate assets in Germany’s top
cities. Velo Capital is currently in the process of
launching new credit strategies across Northern
Europe, with a keen focus on green financing.
The Group’s aspiration irrespective of strategy is to
deliver long-term positive impact alongside attractive
returns for its investors.
Urban Partners has three current, impact priorities:
1) Decarbonize the built environment;
2) (Re)Generate urban neighborhoods; and
3) Pioneer problem-solving partnerships to bridge the
gap between interests of people, cities, and capital
thereby solving and powering the progress of cities and
citizens by investing to help solve the most pressing
urban problems and uniting insights, stakeholders, and
capital to do so.
In this Report, Urban Partners is referring to the Group
and Urban Partners A/S is referring to the Parent
company.
9
Key developments in the year
2023 was an eventful year for Urban Partners with
several major milestones achieved. Notably in 2023
Urban Partners:
• Raised more than DKK 27,200 million (EUR 3,650
million) for a new Nrep fund (“NSF V”). The
largest ever European value-add real estate fund
• Raised DKK 1,962 million (EUR 263 million) for
Nrep Income+ fund
• Undertook via the NSF V fund several notable
acquisitions including
o the majority stake (80%) in one of Poland’s
largest logistics developers, “7R”, investing
approximately DKK 1,490 million (EUR 200
million) into the company
o a majority stake (51%) in Swedish
residential developer Klövern, providing
access to a portfolio of over 20,000 homes
o a Swedish care home portfolio for
approximately DKK 3,133 million (EUR 421
million)
o two Stockholm office acquisitions with a
total leasable area of approximately
50,000 sqm
o 17 care properties in Finland valued at
approximately DKK 745 million (EUR 100
million)
• Acquired new portfolio investments within 2150
Urban Tech Fund I which includes
o Kelvin Systems; Investing DKK 23.6 million
(USD 3.5 million) in de-carbonizing legacy
buildings in the US with technology
reducing wasted energy and enables
pinpoint temperature control
o Investment of DKK 75 million (EUR 10
million) in 1KOMMA5, a company seeking
to help home decarbonization across
Europe
• First close for 2150 Urban Tech Sustainability
Fund II SCSp was on 7 July 2023, onboarding 10
LPs with a total commitment of DKK 648.9 million
(EUR 87 million
• DKK 970 million (EUR 130 million) was raised
during 2023 in Velo Mezzanine Capital (“VMC”),
a Northern Europe focused vehicle investing in
primarily mezzanine loas Germany and the
Nordics.
o Entered a financing agreement with Ylva,
covering the final phase of the Lyyra
building complex in Hakaniemi, Helsinki.
This finance agreement supports Urban
Partners dedication to green financing in
Northern Europe.
o The Lyyra building complex aligns perfectly
with Velo’s mission to drive sustainability
through the capital structure and
prioritizing projects that transform 'brown
to green'
• Strengthened the leadership team by
appointing the following individuals to Partner:
o Urban Partners
▪ Xavier Himmer, COO
▪ Amin Amirian, CHRO
o NREP
▪ Toke Clausen, Head of Office
▪ Joonas Lemström, Head of Finland
There was a net increase of 31 new employees during the
year bringing the total number at the end of 2023 to 719.
Overall Financial Result for the Year and follow-up
on development expectations from last year
Overall, the Group’s income statement for the year
ending 31 December 2023 shows a pre-tax loss of DKK
416.3 million (2022: DKK 21.0 million profit). The net loss
for the year came to DKK 394.6 million (2022: DKK 7.8
million profit).
As at 31 December 2023 the Group’s balance sheet
shows net equity of DKK 107.0 million compared to a DKK
730.8 million on 31 December 2022.
Whilst these results are naturally disappointing, they
have, however, been heavily influenced by negative
“non-operating” items including, most materially,
promote and “promote-like” income write downs of DKK
258.8 million (2022: DKK 104.7 million income) which
includes internal restructurings and associated
adjustments to non-controlling interest in promote of
DKK 30.2 million (2022: DKK 0). There was, furthermore,
a write down of goodwill of DKK 204.6 million (2022: DKK
0) which relates to business acquisitions.
Management feels these reductions in profitability are
not representative of the true ongoing business
performance of Urban Partners. Instead, they reflect a
combination of extraordinary one-off items and the
overall fall in global investment markets created by wider
macro-economic factors (namely interest and high
inflation) and geo-political events (such as the Ukraine
War etc.). The fall in investment markets had a material
impact on investment returns globally and thereby
anticipated promote and business acquisition valuations;
this is not specific to Urban Partners nor its underlying
business.
10
Considering the impacts outlined above, adjusted profit
before tax ended at DKK 108.0 million, which is better
than the expected range of DKK 70-80 million.
Management considers this as a better measure of
performance during 2023, and is satisfied with the
underlying operational result when adjusting for “non-
operating” items. This is also reflected in the Group
cashflow statement in which ordinary “cash generating”
business activities led to a significant increase in the
group’s total cash position and the total accounting loss
being materially impacted by non-cash, accounting
related items.
Total revenue ended at DKK 1,401.7 million, down 5%
compared to 2022 (2022: DKK 1,473,1 million), which
would ordinarily be considered as low compared to an
expected revenue increase of 5-10%. However, the
decline in revenue is the direct result of an adjustment to
a contingent consideration in a "promote like”
management fees from one of our major real estate
management contracts. Adjusting for this, revenues rose
year on year by 7.5 % (DKK 109.0 million). Total
management fees for the year ended at DKK 1,118.8
million, up 19% compared to 2022 (2022: DKK 942.3
million) and service corporate fees ended at DKK 304.2
million, up 36% compared to 2022 (2022: DKK 223.2
million), representing a strong growth in the underlying
core business and considered satisfactory by
management compared to expectations.
Administrative expenses (excl. staff costs) for the year
amounted to DKK 582.1 million, down 0.3% compared to
2022 (DKK 583.7 million), and staff costs amounted to DKK
818.9 million, up 2% compared to 2022 (DKK 803.0
million). The drop in total net operational costs is a result
of tight cost control and a number of simplification efforts
throughout the year in response to a tough global macro-
economic environment and is considered satisfactory –
particularly in light of a growing underlying core business.
During 2023 Urban Partners increased the employee staff
with 31 employees representing a year end increase of
4,5%, which is in line with the lower end of the expected 5-
10% increase for the year and further reflects
management’s focus on costs prudence at this time. The
focus of recruitments has been on:
• asset management and operational staff to
support a growing asset base
• staff supporting strategic focus areas such as
country expansion, capital raise and sustainability
• staff supporting a stronger, more robust and
scalable back-office housing multiple investment
strategies (data, systems & regulatory)
Targets and expectations for the year ahead
Urban Partners' management anticipates a marginally
higher level of activity during 2024.
Whilst there are fund raising aspirations for all investment
strategies during 2024, these are anticipated to take place
over the course of the year, and none are of the scale of
the NSF V final close experienced in 2023 (even allowing
for a potential close of NSF VI during 2024) and so revenues
are anticipated to grow by 0-5%.
Costs are expected to increase marginally year on year, as
we balance the need for Urban Partners to continue to
build its organization but at a slower pace than historically.
Given the current stabilization (if not recovery) of real
estate markets in particular, NREP-related investments are
expected to continue to stabilize and deliver solid fund
returns and profitability for the Group. Maturing strategies
in 2150 and Velo are expected to begin to stabilize and help
group profitability. Overall “ordinary” operating
profitability of the Group is expected to remain largely
unchanged year on year except for anticipated costs of
investigating potentials other investments strategies.
However, write downs recognized in 2023 related to
promote and Goodwill are not anticipated to repeat during
2024 narrowing the divergence between operating
performance and total accounting performance. Overall,
the result for the coming year is expected to be in line with
the longer-term strategic plans of the Group. Profit before
taxes (excluding depreciation, amortization, impairment
2023
Adjusted profit mDKK
Profit before tax reported (416.3)
Specified items
Depreciation, amortisation and impairment losses 275.6
Financial income (47.8)
Financial expenses 37.7
Fair value of promote recognized 139.6
Adjusted "promote like" management fee, before tax 119.2
Adjusted profit 108.0
2023 2022
Revenue mDKK mDKK Delta %
Asset management fee 1,118.8 942.3 19%
Service corporate fee 304.4 223.2 36%
Other revenue (21.3) 307.6 (107%)
Total revenue reported 1,401.7 1,473.1 (5%)
11
losses, financials and promote) is expected to be in the
range of DKK 0-10 million.
Market risks
Management fees received from funds are primarily based
on the committed or deployed capital. In Management's
assessment, the risk profile of the Urban Partners is normal
for this market.
The value assessments of properties, held directly or
indirectly through equity investments, are inherently
subject to some degree of uncertainty. To limit the risk to
the greatest extent, all relevant properties have been
assessed by external valuers, who are independent of the
company.
In 2023 the ongoing war in the Ukraine had a very limited
direct business impact on Urban Partners as the business
has no assets in Russia, Belarus, or Ukraine and, as it
predominantly operates close end funds with fees
associated with equity commitments, short term valuation
fluctuations do not materially impact income. However, an
indirect impact due to the deterioration of the EU and
global economy had some negative consequences also for
the financials of the funds and ultimately for Urban
Partners.
The greatest impacts continue to be higher construction
costs across a broad range of building materials and higher
energy prices than before (where Russia has been a major
supplier). Urban Partners has not had any major delays or
direct losses because of increased construction costs and
as such the war in Ukraine had an ongoing moderate
impact on the Group’s real estate investment activity
during 2023 (mainly affecting development projects) but
one that is manageable.
A further impact and one that we anticipate having
ongoing effects in 2024 is the effect of general higher
inflation than existed previously, despite these having
reached in many cases an apparent peak and interest rates
having begun to fall.
Urban Partners has experienced higher interest rates on
real estate pressure on the level of available financing due
to the debt service ratios required by the lenders. This is
resulting in lower loan-to-cost (LTC) and loan-to-value
(LTV) levels provided by the banks, reducing the return
potential for new investments currently. There was also
particular stress on credit to Venture Capital activities in
2023 following the Silicon Bank failure (a material lender to
this sector) but this has also not had a direct impact on
Urban Partners itself.
Urban Partners’ is now focusing on securing successful
exits for the current investments in the exit pipeline as well
as carefully managing the financing risk for new
commitments.
The overall market environment such as higher interest
rates resulting in higher financing costs, FX fluctuations,
inflation pressures on construction materials, some
tensions in some sectors resulting in certain disruptions for
tenants’ operations, and an the overall yield expansions in
the Real Estate market, resulted in a decrease of valuation
and of the funds’ performance. While the management
fees stream remain unimpacted, Urban Partners suffered
of a notable decrease of some of the expected promote
receivables which are based on the funds projected
performances and returns.
Fraud risks
Fraud risk is acknowledged as both an internal and external
concern. Internally, it encompasses the risk of financial
losses due to deceptive acts within the organization, such
as misuse of company resources or falsifying transactions.
To combat this, measures like the four-eyes principle for
invoice processing, vigilant supervision of transactions, and
meticulous record-keeping have been instituted, alongside
annual audits. These efforts, coupled with forthcoming
initiatives like enhanced payment guidelines and fraud
awareness training, is expected to reduce the fraud risk.
Externally, the organization faces threats from outside
actors, including cybercriminals and fraudulent vendors.
Despite similar controls being applied, such as the four-
eyes principle and transaction monitoring, the inherent
risk posed by external fraud remains high, with residual risk
evaluated as medium after considering the mitigations in
place.
Foreign exchange risks
The Group primarily receives management fees in EUR,
whereas the Group's expenses are distributed between
DKK, SEK, NOK, PLN, GBP, and EUR. This implies a risk in
respect of exchange fluctuation of which the main part is
however covered for operating purposes by matching
income and expenses in the same currency. Urban
Partners has a dedicated Treasury function which focus on
treasury related risk areas.
12
Interest rate risks
The interest rate risk of Urban Partners A/S and its affiliates
consists mainly of external financing, which is split
between floating and fixed rate instruments. On the
reporting date the floating rate interest-bearing liabilities
amounted to EUR 15.0 million and fixed rate interest-
bearing liabilities to EUR 23.1 million. At the end of 2023,
61% of the non-current liabilities were at a fixed rate.
Urban Partners is indirectly exposed to interest rate risk
through the Funds' performance. Funds have a dedicated
policy for their own interest rate risk exposures.
Development activities
During 2023 investments of DKK 22 million were made in
development activities. Development projects include
investments in digitalization projects and zero carbon
activities and few new platforms as well as specific joint
ventures with the aim of supporting the long-term strategy
and focus areas of Urban Partners.
Corporate Social Responsibility / Environmental,
Social and Governance factors – Urban Partners
The Groups business model is described in the
Management Review, under the Key Activities section.
Urban Partners has a policy to take a pioneering role in
solving global and local sustainability challenges related to
real estate. Urban Partners, including its strategies, want
to develop better real estate products that enable:
• Citizens to live in environmentally sound and
healthy houses at all stages of their life.
• Businesses to run their businesses sustainably by
offering environmentally sound and healthy
buildings.
• Environmentally sound and healthy urban
development for a prosperous society.
Urban Partners’ policies on environmental, social
sustainability and health & safety articulate the Urban
Partners’ strategic commitment to build a prosperous
future and are an integral part of Urban Partners’ approach
to risk management and value creation.
While buildings and development provide countless
benefits to society, they also have significant
environmental impacts. For example, approximately 40 %
of the total energy use in the society, can be allocated to
the operation of buildings and roughly 40% of global raw
materials are used in buildings. Urban Partners focus on
efficient energy use, on reusing and recycling resources
with greater effectiveness.
Urban Partners has policies in place covering the following
areas: Environmental conditions, climate impacts, social
conditions and personnel conditions, respect for human
rights, anti-corruption, and bribery. The policies contain
frameworks for compliance with the Group's own rules as
well as applicable legislation. Urban Partners continuously
supervises compliance with the policies and ensures that
the policies are updated regularly to comply with
applicable regulations and standards.
This work will continue going forward, and in 2023 has
produced satisfactory results, measured in terms of
impact.
Urban Partners translates this policy into action by striving
to ensure that assets are subject to environmental
improvement. This also include sustainability assessments
in the due diligence process and developing a plan for
improvement. In developments and new constructions,
the company constantly endeavor to leap-frog and
transform existing practices and processes for better
environmental outcomes and to pursue opportunities for
increasing the provision of natural energy. Risk
management related to sustainability is a part of the policy.
Urban Partners’ activities are exposed to various
environmental risks including, but not limited to, physical
climate risk and transition risk. Physical risks being storms,
floods, heavy rain which are some of the most common
physical risks in the Nordics. Transition risks are business-
related risks that follow societal and economic shifts
toward a low-carbon and more climate-friendly future.
These risks can include policy and regulatory risks,
technological risks, market risks, reputational risks, and
legal risks.
Urban Partners’ efforts in combatting climate change by
reducing embodied and operational carbon footprint are
highly aligned with Urban Partners’ efforts to mitigate such
climate change risks.
As part of the commitment to the SBTi, Urban Partners
will establish science-based targets for both upfront
embodied and operational GHG emissions for 2028.
For 2023, Urban Partners results and progress of the
Environmental conditions are considered satisfactory. In
the future, Urban Partners will continue to focus on this
area and the ambition is to reach net zero emissions by
2028 for operational and embodied carbon emissions from
real estate assets where Urban Partners has operational
control as defined in Urban Partners’ decarbonization
13
policy. Urban Partners is committed to take a leading role
in the green transition.
Social and personnel conditions
To achieve the Urban Partners’ long-term objectives and
deliver on its purpose, Urban Partners and its strategies
policy is to build a team of different complementary
personalities, skills, and backgrounds, that work together
in a culture where Urban Partners value the differences.
Urban Partners seeks a working environment that enables
everyone to unleash their full potential and, at the same
time, be treated fairly, equally, and respectfully.
Urban Partners translate the policy into action by enforcing
a non-discriminatory and fair treatment as a natural
principle and value that permeates all business activities.
Urban Partners has since inception diligently focused on
building a working environment and culture that is
characterized by caring, equality, diversity, and respect,
and that is free from oppression, discrimination,
harassment, and bullying.
Urban Partners is committed to ensure compliance with
local labor legislations and requirements in countries of
operation. Employee satisfaction is measured
continuously, using several KPIs, including, but not limited
to: Leadership, Job satisfaction, Personal development,
and Commitment.
The built environment has a profound impact on human
health and wellbeing, both physically, mentally, and
socially. By especially focusing on human-centric design,
healthy materials, and smart integration and co-existence
with nature, Urban Partners aspire to create healthy,
supportive, beautiful, and diverse communities and
environments.
Urban Partners seeks the best possible outcome with the
stakeholders and is committed to establishing sustainable
relationships to ensure social sustainability of its assets and
any development projects. Urban Partners recognizes that,
at every stage of development and operation potential,
negative effects may occur due to lack of communication
and stakeholder engagement. In the short and long terms,
good management of communication and relationship
with local stakeholders is essential to the business success
of the developments and standing assets with potential
impacts on local stakeholders.
Urban Partners’ activities are exposed to various social and
personnel risks including, but not limited to, social risk and
health and wellbeing. Urban Partners is assessing this risk
along with several other risks, as an integral part of Urban
Partners’ process from lead stage and initial screenings
through to Due Diligence and eventually Investment
Committee. The risk assessments flags identified or
potential risks that either requires further investigation or
requires a next level screening to de-select the
opportunity. Identified risks are, in subsequent steps,
investigated in more detail to understand if they can be
managed/mitigated in a way that meets Urban Partners’
underwriting and ESG requirements.
Urban Partners has made their Diversity, Equity & Inclusion
Policy available to all employees on its intranet. All
employees are encouraged to regularly review this to
ensure that Urban Partners meets its legal obligations as
well as its moral obligations within the areas of equal
treatment.
During 2023, Urban Partners has via its strategy Nrep,
completed or are in the process of completing residential
units of addressing student housing, community-based
living, mixed generation communities, senior housing, care
homes or rental apartments as part of Urban Partners’
journey to address societal challenges.
For 2023, Urban Partners’ results and progress for social
and personnel conditions is considered satisfactory. Urban
Partners expect to continue its focus on this area in the
future.
Respect for human rights
Urban Partners and its strategies do not tolerate slavery or
human trafficking within its business or supply chains.
Urban Partners has implemented an anti-trafficking and
slavery policy and applies this to all employees, temporary
workers, contract workers and third parties acting on the
Urban Partners’ behalf.
Urban Partners makes the policy available to all employees
on its intranet, to ensure awareness of the topic of slavery
and human trafficking and ensures that Urban Partners
meets both its legal obligations as well as its moral
obligations. All new suppliers or partners must provide
assurance that they do not engage in slavery or human
trafficking.
The provisions of this policy are subject to compliance with
applicable legal requirements in the Urban Partners’
countries of operation.
Urban Partners’ activities are exposed to various human
rights risks including, but not limited to reputational risk of
noncompliance.
Page 14 of 65
As a minimum, Urban Partners will meet all local
requirements (including but not limited to requirements
regarding local community consultation), assess risks and
opportunities as part of due diligence and, in addition,
proactively engage with relevant local stakeholders to
mitigate risks where potential risks are identified.
Urban Partners communicates the policy to employees,
suppliers, and contractors to inspire, motivate, create
awareness and to actively invite for broad participation.
Urban Partners presents the policy to all onboarding
employees and annually to the rest of Urban Partners, to
ensure awareness of the topic of slavery and human
trafficking and ensure that Urban Partners meets both its
legal obligations as well as its moral obligations. For 2023,
Urban Partners’ results and progress with respect to
human rights is considered satisfactory. In the future,
Urban Partners will continue focus on this area.
Anti-corruption and bribery
Urban Partners and its strategies are committed to
conducting all its business operations in an honest, fair,
transparent, and ethical manner. Corruption inhibits
economic growth and affects business operations,
employment, and investments. To avoid the negative
consequences of corruption, Urban Partners has
implemented an Anti-Bribery and Corruption Policy,
prohibiting any form of corruption and bribery in
connection with its business activities. The Risk and
Compliance Committee monitor the implementation of
this policy and coordinate periodic training on this policy
for Urban Partners and the employees of each strategy.
Urban Partners’ activities are exposed to various anti-
corruption and bribery risks including, but not limited to
reputational risk and risk of noncompliance. Urban
Partners will, at a minimum meet, all local requirements
(including but not limited to those relating to local
community consultation), will assess risks and
opportunities as part of due diligence and will proactively
engage with relevant local stakeholders, where potential
risks are identified, to mitigate such risks. Urban Partners
communicates its policy to employees, suppliers, and
contractors to inspire, motivate, create awareness and to
actively invite for broad participation. For 2023, Urban
Partners’ results and progress for Anti-corruption and
bribery is considered satisfactory. Urban Partners will
continue to focus on this area in the future.
Account of the gender composition of management
Urban Partners and its strategies are committed to
encouraging a working environment that promotes
equality, inclusion, and diversity by providing equal
opportunity for employment, training, advancement, and
development.
Urban Partners has developed a Diversity, Equity &
Inclusion Policy to promote equality and diversity and is
committed to never discriminating in employment or
remuneration due to race, color, religion, sex, political
opinion, national extraction, social origin, or any other
attribute which bears no relation to the job performed.
To further promote workplace awareness, diversity, and
inclusion, a rainbow/LGBTQIA community has been
initiated recently.
Numerical overview of underrepresented gender in
Urban Partners’ management levels
Over the past years, Urban Partners and its strategies has
steadily increased the percentage of female talent in the
organization, up from 25 % in 2016 to 43 % today. In
recent years, women have joined both the Partner group,
Advisory board, and Board of Directors. The level of
female representation, however, in relation to the
composition of senior management forums requires a
matter of ongoing focus and attention to further improve
this aspect of the Groups diversity metrics:
Senior management body:
• Board of Directors consists of four men (80%)
and one woman (20%).
Urban Partners’ target has not yet been reached but the
focus will be on reaching this target within the next 5
years.
The candidates considered were balanced in gender and
ultimately led to the election of the candidate most
aligned with the profile and experience the company
wanted to add to the board at this time.
Other levels of management:
• Executive Leadership Council consists of ten
men (91%) and one woman (9%)
• Operations Management Team consists of
seven men (50%) and seven women (50%)
15
One of the two other levels of management within Urban
Partners has equal distribution of men and women.
In 2023 the focus for the Board of Directors was to ensure
larger representation of external counterparties, which
increased from 40% to 60%. No changes were made to
the gender composition in the board during 2023.
To increase the percentage of the under-represented
gender, Urban Partners has implemented different
initiatives. As an example Urban Partners has a
standardized recruitment criteria and through 2023 has
made a special effect effort to ensure a strong pipeline of
female candidates by targeting job ads and search efforts.
Furthermore, Urban Partners’ assessment criteria for
new joiners and annual performance assessments are
designed to minimize bias against any population and
encourage a diverse workforce. Subsequent to the date
of this report Urban Partners has set itself the target to
hire 50% of all new analysts as the under-represented
gender across the workforce.
These initiates will be continued in 2024 and expanded
upon to further the diversity agenda.
The Executive Leadership Council and the Operations
Management Team consists of 25 in total. However, it is
only 19 persons that meets the criteria in 99b i.e. have
responsibility for employees. Thus only the 19 is included
in the table below.
Schematic five-year overview - gender composition of the management in Urban Partners
2023
Highest governing body
Total number of members
5
Underrepresented gender (in percentage)
20%
Target figure (in percentage)
40%
Year for meeting target figure
2028
Urban Partners’ other management levels
Total number of members
19
Underrepresented gender (in percentage)
16%
Target figure (in percentage)
20%
Year for meeting target figure
2028
Data ethics
Urban Partners and its strategies assess that data ethics
is data security, it`s the right to privacy for Urban
Partners’ employees and it`s the organization`s methods
of archiving and documentation.
Urban Partners has developed an Information Security
Policy, Privacy Policy and Documentation Policy which all
covers the subject data ethics and therefore can be
placed in the main category 'data ethics policies'.
Urban Partners’ Information Security Policy covers topics
like PC`s, mobile devices, asset management, access
management, encryption, physical security and
environmental security, operational security,
communication security, acquisition, development and
maintenance of systems, supplier relations, in-formation
security incident management, information security
aspects of emergency, contingency and recovery
management, and compliance.
Urban Partners’ Privacy Policy covers data gathered
before employment, during employment, master data,
personal data concerning health and data about next of
kin, reprimands, warnings, data about control measures,
use of photos, severance service, sources, storage and
erasure, other recipients who may process personal data,
transfer of personal data to third countries, employee
rights, filing of complaints with the national data
protection agency, archiving and documentation.
Urban Partners’ Documentation Policy covers duties and
responsibilities, preservation of information, format of
recording, archiving and documentation.
All these policies are an integral part of Urban Partners’
work to secure compliance with applicable laws and
regulation in general. This includes setting up internal
controls and making sure Urban Partners has sufficient
competencies in place by providing training to relevant
functions.
Urban Partners is aware of the digital operations
resilience act entering (”DORA”) into force by 2025. As
DORA applies to companies within the financial sector,
Urban Partners is currently assessing the necessary
measures to be considered prior to the implementation
of the regulation applicable to Urban Partners and its
verticals.
16
Income statement
Group
Parent
tDKK
Note
2023
2022
2023
2022
Revenue
1
1,401,680
1,473,090
378,143
663,782
Administrative expenses
(582,112)
(583,742)
(164,591)
(206,353)
Staff expenses
2
(818,913)
(802,966)
(298,141)
(376,318)
Operating profit/loss
655
86,382
(84,589)
81,111
Income from investments in associates related
to Group managed funds
2
13
(82,402)
2,115
-
-
Income from investments in other investments
related to Group managed funds
2
14
(62,041)
(16,629)
-
686
Income from investments in joint ventures
related to Group managed funds
2
12
4,797
-
-
-
Depreciation and impairment
6,7,8
(275,592)
(46,977)
(14,042)
(4,882)
Profit/loss before financial income & expenses
(414,583)
24,891
(98,631)
76,916
Income/loss from investments in subsidiaries
9
-
-
(106,047)
(19,672)
Income/loss from investments in joint ventures
12
(3,554)
(6,397)
14,552
(6,397)
Income/loss from investments in associates
13
(1,118)
(285)
(1,093)
(471)
Income/loss from investments in other
investments
14
(7,282)
14,148
-
-
Net gain/loss in sale of shares in other
investments
82
(221)
121
-
Financial income
3
47,827
5,559
47,085
4,151
Financial expenses
4
(37,721)
(16,692)
(40,777)
(30,152)
Profit/loss before tax
(416,349)
21,003
(184,790)
24,375
Tax on profit/loss for the year
5
21,768
(13,245)
26,515
(16,102)
Net profit/loss for the year
(394,581)
7,758
(158,275)
8,273
Thereof:
Attributable to the shareholders
(358,180)
3,835
Attributable non-controlling interests
(36,401)
3,923
(394,581)
7,758
Item that may be reclassified to profit or loss
Exchange rate adj. on translation of foreign
operations
1,646
(4,781)
Total other comprehensive income
1,646
(4,781)
Total comprehensive income
(392,935)
2,977
Thereof:
Attributable to the shareholders
(356,539)
(927)
Attributable non-controlling interests
(36,396)
3,905
(392,935)
2,977
2
Income from investments in Group managed funds relates to promote (carried interest).
17
Balance sheet
Group
Parent
tDKK
Note
2023
2022
2023
2022
Goodwill
117,262
321,847
-
-
Software
38,063
17,348
32,471
17,348
Other intangible
148,775
164,869
-
-
Development projects in progress
7,168
15,525
5,370
15,266
Intangible assets
6
311,268
519,589
37,841
32,614
Land and buildings
7
375
1,612
-
1,160
Other fixtures, fittings, tools and equipment
7
16,604
19,549
8,936
8,764
Leasehold improvements
7
4,733
6,321
2,439
3,600
Right-of-use assets
8
84,150
64,713
-
-
Property, plant and equipment
105,862
92,195
11,375
13,525
Investments in subsidiaries
9
-
-
521,431
565,571
Investments in joint ventures
12
23,091
1,727
2,539
1,727
Investments in associates
13
20,554
134,952
12,030
13,134
Receivables from group enterprises
14
-
-
19,477
23,888
Other investments
14
185,436
317,811
57,817
41,280
Other receivables
14
91,637
225,756
81,898
216,219
Deferred tax asset
5
55,361
50,657
32,687
32,481
Total other non-current assets
376,079
730,902
727,879
894,300
Total non-current assets
793,209
1,342,686
777,095
940,439
Trade receivable
15
112,542
206,783
30,290
115,111
Receivables from group enterprises
15
-
-
9,911
415,857
Other receivables and income tax rec.
15
230,422
112,158
102,660
89,091
Other current assets
16
20,709
16,601
10,323
11,160
Cash
295,112
256,694
540
36
Total current assets
658,785
592,236
153,724
631,255
Total assets
1,451,994
1,934,922
930,819
1,571,694
Share capital
18
1,380
1,366
1,380
1,366
Equity method reserve
-
-
-
(32,246)
Reserve for foreign currency translation
(23)
(4,422)
-
-
Reserve for development costs
-
-
4,189
11,908
Retained earnings
93,521
642,683
36,974
406,359
Equity attributable to Urban Partners A/S
94,879
639,627
42,543
387,386
Minority interests
19
12,102
91,207
-
-
Equity
106,981
730,834
42,543
387,386
Provisions
26
13,856
53,651
4,231
6,794
Lease liabilities
8
62,810
33,485
-
-
Tax liabilities
-
6,976
-
-
Deferred tax liabilities
5
47,601
78,464
-
26,218
Other payables
21
288,397
187,518
288,397
171,494
Total non-current liabilities
412,664
360,094
292,628
204,506
Lease liabilities
8
24,522
32,422
-
-
Borrowings
21
20,273
93,139
20,273
93,139
Trade payables
21
252,763
276,087
211,354
268,113
Payables to group enterprises
-
-
253,471
528,940
Other payables
21
634,791
442,346
110,550
89,609
Total current liabilities
932,349
843,994
595,648
979,802
Total liabilities
1,345,013
1,204,088
888,276
1,184,308
Total equity and liabilities
1,451,994
1,934,922
930,819
1,571,694
18
Statement of changes in Equity
Group
tDKK
Share
capital
Reserve for
foreign
currency
translation
Retained
earnings
Equity
attributable
to owners of
the parent
company
Non-
controlling
interests
Total
2023
Equity at 1 January
1,366
(4,421)
642,684
639,628
91,207
730,835
Net profit/loss for the year
-
-
(358,180)
(358,180)
(36,401)
(394,581)
Exchange rate adj. related to
foreign entities
-
4,399
(2,758)
1,641
5
1,646
Total comprehensive income
-
4,399
(360,938)
(356,539)
(36,396)
(392,935)
Capital increase
14
-
43,356
43,370
-
43,370
Purchase of treasury shares
-
-
(192,717)
(192,717)
-
(192,717)
Sale of treasury shares
-
-
14,571
14,571
-
14,571
Purchase of non-controlling interest
-
-
(53,434)
(53,434)
1,169
(52,265)
Sale of non-controlling interest
-
-
-
-
(29,876)
(29,876)
Non-controlling dividend
-
-
-
-
(14,002)
(14,002)
Equity at 31 December
1,380
(22)
93,522
94,879
12,102
106,981
2022
Equity at 1 January
1,359
341
623,983
625,682
87,302
712,985
Net profit/loss for the year
-
-
3,835
3,835
3,923
7,758
Exchange rate adj. related to
foreign entities
-
(4,762)
-
(4,762)
(19)
(4,781)
Total comprehensive income
-
(4,762)
3,835
(927)
3,905
2,977
Capital increase
7
-
14,866
14,873
-
14,873
Equity at 31 December
1,366
(4,421)
642,684
639,628
91,207
730,835
19
Parent
tDKK
Share
capital
Equity
method
reserve
Reserve for
development
costs
Retained earnings
Total
2023
Equity at 1 January
1,366
(32,246)
11,908
406,359
387,386
Net profit/loss for the year
-
27,847
-
(186,122)
(158,275)
Exchange rate adj. foreign entities
-
4,399
-
(2,755)
1,644
Capital increase
14
-
-
43,356
43,370
Purchase of treasury shares
-
-
-
(192,717)
(192,717)
Sale of treasury shares
-
-
-
14,571
14,571
Acquisition of minority interests
-
-
-
(53,437)
(53,437)
Development costs for the year (net of tax)
-
-
(7,719)
7,719
-
Equity at 31 December
1,380
-
4,189
36,974
42,543
2022
Equity at 1 January
1,359
7,530
3,895
356,197
368,981
Net profit/loss for the year
-
(26,535)
-
34,807
8,273
Exchange rate adj. foreign entities
-
(4,739)
-
-
(4,739)
Capital increase
7
-
-
14,866
14,873
Other movements associates & JV
-
(8,501)
-
8,501
-
Development costs for the year (net of tax)
-
-
8,013
(8,013)
-
Equity at 31 December
1,366
(32,246)
11,908
406,359
387,386
20
Statement of cash flow
Group
tDKK
Note
2023
2022
Net profit/loss for the year
(394,581)
7,758
Adjustments to reconcile profit before tax to net cash flows:
Financial income
3
(47,827)
(5,559)
Financial expenses
4
37,721
16,692
Depreciation, amortisation and impairment losses
6,7,8
275,592
46,977
Loss (gain) on intangible assets
6
5,477
4,238
Loss (gain) on disposal property, plant and equipment
7
1,240
(258)
Loss (gain) in sale of shares in other investments
(82)
221
Income from Investments in associates
13
1,118
285
Income from investments in joint ventures
12
3,554
6,397
Income from investment in other investments
14
7,282
(14,148)
Income from investments in associates related to Group managed funds
13
82,402
(2,115)
Income from other investments in Group managed funds
14
62,041
16,629
Carried interest in joint ventures related to Group managed funds
(4,797)
-
Tax on profit/loss for the year
5
(21,768)
13,245
Changes in net working capital:
Change in other non-current receivables
134,119
(212,645)
Change in receivables and other receivables
90,133
(24,228)
Change in other current financial assets
(118,264)
(51,098)
Change in trade payables and other payables
123,979
162,203
Change in non-current other payables
4,599
78,201
Provisions
(39,795)
2,227
Exchange rate realised net
3,4
(1,597)
2,692
Income tax paid
5
(4,056)
(5,966)
Net cash flow from operating activities
196,490
41,749
Acquisition of subsidiaries, net cash acquired
11
-
14,697
Purchase of intangible assets (including business combinations)
6
(27,901)
(32,062)
Purchase of property, plant and equipment
7
(5,715)
(21,683)
Purchase of investments in associates
13
-
(33)
Purchase of investments in joint ventures
12
(4,373)
(7,180)
Disposal of investments in associates
13
428
7,156
Purchase of other non-current financial assets
14
(27,495)
(47,338)
Disposal of other non-current financial assets
14
6
3,616
Interest income received
3
3,831
392
Dividend income received
12,13,14
71,894
16,360
Net cash flow from investing activities
10,674
(66,074)
Capital increase
17
-
14,873
Proceed from borrowings
21
106,130
151,406
Repayment of principal portion of lease liabilities
8
(37,367)
(28,590)
Acquisition of non-controlling interest
(9,350)
Purchase of treasury shares
(192,717)
-
Sale of treasury shares
14,571
-
Interest paid
4
(34,724)
(16,692)
Dividend paid to non-controlling interest
10
(14,002)
-
Cash flow from financing activities
(167,458)
120,997
Change in cash and cash equivalents
39,706
96,672
Cash and cash equivalents at 1 January
256,694
171,603
Exchange adjustment of cash and cash equivalents
(1,288)
(11,581)
Cash and cash equivalents at 31 December
295,112
256,694
Page 21 of 65
Notes to the financial statement
1. Revenue
Group
tDKK
Corporate
Living
Logistic
Office
D&I
Care
Credit
Total
2023
Asset Management Fee
745,190
102,446
83,443
30,919
65,364
8,021
83,383
1,118,766
Service corporate fee
63,878
126,921
27,604
30,794
49,014
6,016
-
304,227
Other revenue
16,445
(37,917)
159
-
-
-
-
(21,313)
Total
825,513
191,450
111,206
61,713
114,378
14,037
83,383
1,401,680
2022
Asset Management Fee
527,187
95,239
115,821
60,508
47,640
28,545
67,380
942,320
Service corporate fee
48,550
82,269
21,716
21,737
37,959
10,987
-
223,218
Other revenue
8,477
299,075
-
-
-
-
-
307,552
Total
584,214
476,583
137,537
82,245
85,599
39,532
67,380
1,473,090
Parent
tDKK
Corporate
Living
Logistic
Office
D&I
Care
Credit
Total
2023
Asset Management Fee
8,934
40,580
12,341
26,346
27,697
1,638
-
117,536
Service corporate fee
24,530
53,626
1,874
26,854
25,935
3
-
132,822
Other revenue
6,486
(181,350)
-
-
-
-
-
(174,864)
Internal Advisory Fee
303,751
-
-
(1,102)
-
-
-
302,649
Total
343,701
(87,144)
14,215
52,098
53,632
1,641
-
378,143
2022
Asset Management Fee
(3,112)
40,083
17,602
54,398
30,112
7,431
-
146,514
Service corporate fee
11,414
40,160
3,548
21,756
23,448
3,538
-
103,864
Other revenue
13,575
183,193
(86)
-
-
-
-
196,682
Internal Advisory Fee
216,722
-
-
-
-
-
-
216,722
Total
238,599
263,436
21,064
76,154
53,560
10,969
-
663,782
For the Group, business line Corporate, Other revenue income mainly relates to revenues generated by platforms that
operate the real estate investments in which Urban Partner managed funds invests, thereby generating additional
revenue for the manager.
Under business line Living, Other revenue, both Parent and Group are affected by the reversal of contingent
consideration from 2022 totalling DKK 181.4 million.
In 2022, for the Parent, business line Corporate, Asset management fee is affected by a different allocation of business
accruals in 2021.
22
2. Staff expenses
Group
Parent
tDKK
2023
2022
2023
2022
Wages and salaries
709,454
597,671
306,308
276,755
Pensions
63,270
52,206
20,210
18,694
Other social security expenses
49,057
40,507
2,329
(689)
Other staff expenses
(2,868)
112,583
(30,706)
81,558
Total
818,913
802,966
298,141
376,318
Average number of employees
697
590
272
247
Other staff expenses include staff recruitment costs and the costs of temporary workers.
Key Management Compensation
The key management for Urban Partners has been defined as the Executive Leader Council which consist of 11 persons
(2022: 15 persons) and Board of Directors. The compensation paid or payables to key management for employee services
is shown below:
Group
tDKK
2023
2022
Wages and salaries
44,984
48,857
Pensions, defined contribution plans
-
316
Total
44,984
49,174
Compensation to the Board of Directors and Executive Management
Compensation to the Board of Directors
1,457
2,082
Compensation to Executive Board
7,607
7,855
Total Compensation to the Board of Directors and Executive Management
9,064
9,937
Compensation to other Key
Management personnel
35,920
39,236
44,984
49,174
As regards to the share based payment reference is made to note 17 share base payment.
23
3. Financial Income
Group
Parent
tDKK
2023
2022
2023
2022
Dividends on share in other investments
-
-
-
500
Interest received from group enterprises
-
-
2,469
1,472
Exchange gains
-
2,692
-
-
Other interest income
3,831
392
632
390
Other financial income
43,996
2,474
43,984
1,789
Total
47,827
5,559
47,085
4,151
Other financial income is in 2023 impacted by a reversal of contingent consideration totalling DKK 37.7 million.
4. Financial expenses
Group
Parent
tDKK
2023
2022
2023
2022
Interest paid to group enterprises
-
-
10,754
9,274
Other interest expenses
31,854
15,360
29,403
13,775
Exchange losses
1,597
-
620
7,103
Lease expenses
Value adjustments other investments
2,869
1,401
1,332
-
-
-
-
-
Total
37,721
16,692
40,777
30,152
Other interest expenses refers to interest on the group’s working capital facility, interest on cash management services and
other bank charges.
24
5. Income tax
The major components of income tax expense for the years ended 31 December 2023 and 2022 are:
Group
Parent
tDKK
2023
2022
2023
2022
Current tax for the year
(13,799)
(6,976)
-
-
Deferred tax for the year
35,567
(6,269)
26,515
(16,102)
Income tax expense – income statement
21,768
(13,245)
26,515
(16,102)
Reconciliation of tax expense and the accounting profit multiplied by Denmark’s domestic tax rate for 2023 and 2022:
At Denmark’s statutory income tax rate of 22% (2022:
22%)
(91,597)
4,621
(40,654)
5,363
Tax effects
Non-taxable income
(3,640)
4,928
(7,623)
4,928
Non-deductible expenses
74,299
6,639
23,072
4,807
Other
(830)
(2,943)
(1,310)
1,005
Tax effects, total
69,829
8,624
14,139
10,739
Tax expenses
21,768
(13,245)
26,515
(16,102)
Effective tax rate
-6%
-63%
-17%
-66%
Deferred tax assets
Provision for deferred tax assets at 1 January
(50,657)
(33,872)
(32,481)
(22,365)
Amounts recognised in the statement of income
(4,704)
(16,785)
(206)
(10,116)
Deferred tax assets at 31 December
(55,361)
(50,657)
(32,687)
(32,481)
Deferred tax liabilities
Provision for deferred tax liabilities at 1 January
78.464
-
26,218
-
Deferred tax liabilities as part of business combination
-
55,410
-
-
Amounts recognised in the statement of income
(30,863)
23,054
(26,218)
26,218
Deferred tax liabilities at 31 December
47,601
78,464
-
26,218
Other receivables
-
26,218
-
26,218
Other Intangible
48,527
55,410
-
-
Tax loss carry-forward
(55,361)
(50,657)
(32,687)
(32,481)
Other
(926)
(3,164)
-
-
(7,760)
27,807
(32,687)
(6,263)
Of which presented as deferred tax assets
55,361
50,657
32,687
32,481
Of which presented as deferred tax liabilities
(47,601)
(78,464)
-
(26,218)
Non-taxable income of DKK 3.6 million (2022: DKK 4.9 million) and non-deductible expenses of DKK 74.3 million (2022:
DKK 6.6 million) is mainly related to impairment and income from investments related to Group managed funds.
Utilization of deferred tax assets is dependent on future taxable profit. Management has considered budgets and future
business plans when evaluating recognition of deferred tax assets and finds that there is convincing evidence that
sufficient taxable profit will be available against which the deferred tax assets can be utilized. Recognized deferred tax
assets amount to DKK 55.4 million (2022: DKK 50.7 million).
25
6. Intangible assets
Group
tDKK
Software
Other
intangible
assets
Development
projects in
progress
Goodwill
Total
2023
Cost at 1 January
22,117
182,886
15,525
321,847
542,375
Additions for the year
5,781
-
22,121
-
27,902
Disposals for the year
(3,735)
-
(5,477)
-
(9,212)
Transfer
25,002
-
(25,002)
-
-
Movements due to currency
-
20
1
-
21
Cost at 31 December
49,165
182,906
7,168
321,847
561,086
Impairment & amortisation at 1
January
(4,769)
(18,017)
-
-
(22,786)
Impairment & amortisations
Disposals for the year
(10,068)
3,735
(16,102)
-
-
-
(204,585)
-
(230,755)
3,735
Movements due to currency
-
(12)
-
-
(12)
Impairment & amortisation at 31
December
(11,102)
(34,131)
-
(204,585)
(249,818)
Carrying amount at 31 December
38,063
148,775
7,168
117,262
311,268
2022
Cost at 1 January
3,735
13,051
6,913
-
23,699
Additions for the year
17,750
170,972
12,345
321,847
522,914
Disposals for the year
-
(1,137)
(3,101)
-
(4,238)
Transfer
632
-
(632)
-
-
Cost at 31 December
22,117
182,886
15,525
321,847
542,375
Impairment & amortisation at 1
January
(3,735)
(5,825)
-
-
(9,560)
Impairment & amortisation
(1,034)
(12,191)
-
-
(13,225)
Impairment & amortisation at 31
December
(4,769)
(18,017)
-
-
(22,786)
Carrying amount at 31 December
17,348
164,869
15,525
321,847
519,589
Development projects in progress with carrying value of DKK 7.2 million (2022: DKK 15.5 million) holds capitalized costs
related to Software. Other Intangible assets of DKK 148.8 million (2022: DKK 164.9 million) consists mainly of customer
relationships and brand.
The carrying value of DKK 266.0 million (2022: DKK 486.7 million) in intangible assets (goodwill and other intangibles) is
mainly related to the acquisition of Flins Capital Partners GmbH and the Oak group of companies where Urban Partners
acquired control in 2022 (now described as Velo under Urban Partners ownership).
The Group tests goodwill annually for impairment, or more frequently if there are indications that goodwill might be
impaired. See next page for impairment test.
26
Impairment test of goodwill
For the purpose of the impairment testing, goodwill and other intangibles acquired through business combinations are
allocated to each of the Group’s cash generating units (CGU). A cash-generating unit to which goodwill and other
intangible assets has been allocated is tested for impairment annually, or more frequently if there is any indication that
the unit may be impaired.
The determination of the recoverable amount of a CGU to which goodwill is allocated requires significant Management
judgement in determining the various assumptions, such as cash flow projections, discount rate and terminal growth
rates. The sensitivity of the estimated measurement of these assumptions, combined or individually, can be significant.
The value-in-use calculations are based on the management approved budget for 2024 and forecast for 2025-2028 with
a calculated terminal value thereafter.
The cashflows applied in the budget period reflects Management’s best estimate of future cash flows from Management
fees and other cash inflows from the business acquired, which also includes the assumption of continued expansion and
investments in new Funds as planned as part of the acquisition. The cash outflows reflect the best estimate of costs of
operating the business acquired including the cost supporting the contemplated growth.
Cash flows beyond the five-years budget period are expected to grow with the rate stated below. The growth rate is
consistent with forecasts included in the industry reports specific to the industry where the CGU operates.
In calculating the present value, the discount rate applied reflects the risk-free interest rate with the addition of risks
relating to the CGU, such as the market and financial exposures.
Key assumptions affecting the future cash flows of the CGU is as follows:
• Investment Management Fees from the launch of new Funds, AF IV, V, VI and VII are included in the impairment
test. Fund raising of capital is in alignment with management’s expectations for the period 2025 to 2028
• Revenue from a promote like structure is based on the outperformance of the underlying loans in AF1 in which
a proportion of the cash return generated from these loans, above a threshold paid to investors on a yearly basis,
is shared with the manager
• Long-term growth-rate: 2% (2022: 1%)
• WACC (pre-tax): 13.5% which reflect specific risks of the CGU (2022: 13.0%)
Key assumptions for the impairment test are determined based on Managements’ views incorporating their respective
knowledge, market insights and future expectations. The views are developed and supported by market information
obtained through relevant research and direct correspondence with market participants.
The tests performed at the end of 2023 showed the recoverable amounts were lower than the carrying amounts and
therefore an impairment was recognised. The impairment test showed an enterprise value at DKK 214.3 million.
The enterprise value has been negatively impacted by the overall fall in global investment markets. This has particularly
impacted real estate rental income and investment yields, in turn impacting real estate credit income and loan
recoverability. Both aspects negatively impacted the performance of credit funds managed by the CGU versus
expectations thereby negatively impacting associated enterprise value. This leads to write down on goodwill (DKK 204.6
million). The write down is primarily consequence of lower performance of the underlying loans than previously
anticipated.
The calculation of enterprise value is based on a number of assumptions containing significant estimations which by
nature creates uncertainty. To ensure that substantial changes in the assumptions will not affect the recoverable amount
in such way that a larger impairment is required a sensitivity analysis has been prepared.
The analysis showed if the WACC is changed +/-1% the impairment would be within the range of DKK 187.0 million to DKK
225.8 million.
The sensitivity analysis was performed with the same terminal growth rate and a change of +/-1% in WACC, as these are
significant inputs in the calculation of the recoverable amount.
tDKK
WACC
Valuation
Movement
Applied WACC
Change -1% pp
13.5%
12.5%
214,360
235,512
21,151
Change +1% pp
14.5%
196,742
(17,619)
27
6. Intangible assets (continued)
Parent
tDKK
Software
Development
projects in
progress
Total
2023
Cost at 1 January
22,117
15,266
37,383
Additions for the year
-
20,583
20,583
Disposals for the year
(3,735)
(5,477)
(9,212)
Transfer
25,002
(25,002)
-
Cost at 31 December
43,384
5,370
48,754
Impairment & amortisation at 1 January
(4,769)
-
(4,769)
Impairment & amortisation
(9,879)
-
(9,879)
Disposals for the year
3,735
-
3,735
Impairment & amortisation at 31 December
(10,913)
-
(10,913)
Carrying amount at 31 December
32,471
5,370
37,841
2022
Cost at 1 January
3,735
4,993
8,728
Additions for the year
17,750
12,336
30,086
Disposals for the year
-
(1,431)
(1,431)
Transfer
632
(632)
-
Cost at 31 December
22,117
15,266
37,383
Impairment & amortisation at 1 January
(3,735)
-
(3,735)
Impairment & amortisation for the year
(1,034)
-
(1,034)
Impairment & amortisation at 31 December
(4,769)
-
(4,769)
Carrying amount at 31 December
17,348
15,266
32,614
Development projects in progress holds capitalized costs related to mainly to Software.
28
7. Property, plant and equipment
Group
tDKK
Land and
buildings
Other fixtures
and fittings,
tools and
equipment
Leasehold
improve-
ments
Total
2023
Cost at 1 January
1,800
29,760
10,665
42,225
Additions for the year
-
5,016
699
5,715
Disposals for the year
(1,250)
(624)
-
(1,874)
Movements due to currency
1
(66)
46
(19)
Cost at 31 December
551
34,086
11,410
46,047
Impairment & depreciation at
1 January
(188)
(10,211)
(4,344)
(14,743)
Disposals for the year
106
528
-
634
Depreciation for the year
(94)
(7,740)
(2,326)
(10,160)
Movements due to currency
-
(58)
(8)
(66)
Impairment & depreciation at
31 December
(176)
(17,482)
(6,678)
(24,335)
Carrying amount at 31 December
375
16,604
4,733
21,712
2022
Cost at 1 January
1,250
13,727
7,846
22,823
Additions for the year
550
18,349
2,922
21,821
Disposals for the year
-
(2,014)
(66)
(2,081)
Movements due to currency
-
(302)
(36)
(338)
Cost at 31 December
1,800
29,760
10,665
42,224
Impairment losses and depreciation at
1 January
(65)
(7,383)
(2,756)
(10,204)
Disposals for the year
-
1,757
66
1,823
Depreciation for the year
(123)
(4,746)
(1,661)
(6,530)
Movements due to currency
-
161
7
168
Impairment & depreciation at
31 December
(188)
(10,211)
(4,344)
(14,743)
Carrying amount at 31 December
1,612
19,549
6,321
27,482
29
Parent
tDKK
Land and
buildings
Other fixtures
and fittings,
tools and
equipment
Leasehold
improve-
ments
Total
2023
Cost at 1 January
1,250
13,695
7,467
22,412
Additions for the year
-
4,335
448
4,783
Disposals for the year
(1,250)
(528)
-
(1,778)
Cost at 31 December
-
17,502
7,915
25,417
Impairment & depreciation at 1 January
(90)
(4,931)
(3,866)
(8,887)
Depreciation for the year
(17)
(4,163)
(1,610)
(5,790)
Disposals for the year
107
528
-
635
Impairment & depreciation at 31 December
-
(8,566)
(5,476)
(14,042)
Carrying amount at 31 December
-
8,936
2,439
11,375
2022
Cost at 1 January
1,250
5,407
6,732
13,388
Additions for the year
-
8,288
735
9,023
Cost at 31 December
1,250
13,695
7,467
22,411
Impairment & depreciation at 1 January
(65)
(2,507)
(2,467)
(5,039)
Depreciation for the year
(25)
(2,424)
(1,399)
(3,848)
Impairment & depreciation at 31 December
(90)
(4,931)
(3,866)
(8,887)
Carrying amount at 31 December
1,160
8,764
3,600
13,525
30
8. Leases
The Group has entered leases on properties, cars and
equipment.
The remaining lease period for land and buildings are
mainly 3 years and are related to offices and residential
premises in Denmark, Sweden, Finland, Norway, UK and
Luxembourg.
The non-cancellable lease period for cars is typically
between 12 and 48 months. In general car leases do not
include any extension options.
Lease terms are negotiated on an individual basis and
contain a wide range of different terms and conditions.
The lease agreements do not impose any covenants, but
leased assets may not be used as security for borrowing
purposes.
The Group has recognized the following amounts relating to leases:
Group
tDKK
Right of use
buildings
Right of use
other fixtures
and fittings,
tools and
equipment
Total
Cost at 1 January 2022
88,936
2,265
91,201
Additions
44,370
231
44,601
Disposals
(3,950)
(869)
(4,819)
Exchange differences
(3,157)
(93)
(3,250)
Cost at 31 December 2022
126,199
1,534
127,733
Additions
71,154
1,089
72,243
Disposals
(23,441)
(252)
(23,693)
Exchange differences
184
4
188
Cost at 31 December 2023
174,096
2,375
176,471
Depreciation
Depreciation at 1 January 2022
(40,571)
(1,266)
(41,837)
Depreciation charge for the year
(25,822)
(694)
(26,516)
Impairment & amendments
(375)
101
(274)
Disposals
3,294
769
4,063
Exchange differences
1,498
47
1,545
Depreciation at 31 December 2022
(61,976)
(1,043)
(63,019)
Depreciation charge for the year
(35,778)
(553)
(36,331)
Amendments
(2,127)
13
(2,114)
Disposals
9,103
225
9,328
Exchange differences
(107)
(78)
(185)
Depreciation at 31 December 2023
(90,885)
(1,436)
(92,321)
Carrying amount at 31 December 2023
83,211
939
84,150
Carrying amount at 31 December 2022
64,223
490
64,713
31
The carrying amounts of lease liabilities and the movement during the period is as follows:
Group
tDKK
Lease
liabilities
At 1 January 2022
50,318
Additions - new leases
44,367
Disposals
(46)
Repayment of lease debt
(28,590)
Interest
1,332
Exchange
(1,474)
At 31 December 2022
65,907
Additions - new leases
72,243
Disposals
(14,228)
Repayment of lease debt
(37,367)
Interest
2,869
Exchange
(2,092)
At 31 December 2023
87,332
2023
Within one year from the balance sheet date
24,522
Between one and five years from the balance sheet date
61,272
After five years from the balance sheet date
1,538
2022
Within one year from the balance sheet date
32,422
Between one and five years from the balance sheet date
24,487
After five years from the balance sheet date
8,998
Amounts recognised in the income statement,
relating to leases:
Group
tDKK
2023
2022
Interest expenses
2,869
1,332
Expenses related to low value assets
319
160
Expenses related to short-term leases
13
13
32
9. Investments in subsidiaries
Parent
tDKK
2023
2022
Cost at 1 January
567,531
68,066
Additions for the year
67,612
499,465
Disposal for the year
(4,334)
-
Cost at 31 December
630,809
567,531
Value adjustments at 1 January
(12,527)
11,884
Exchange adjustment
1,569
(4,739)
Net profit/loss for the year
(106,047)
(19,672)
Disposals during the year
3,723
-
Value adjustments at 31 December
(113,282)
(12,527)
Equity investments with negative net asset value amortised over receivables
3,904
10,567
Carrying amount at 31 December
521,431
565,571
Additions for the year, consist of capital injections in newly registered entities (DKK 12.7 million) and capital injections in
existing entities (DKK 54.9 million).
33
Investments in subsidiaries are specified as follows:
Name
Place of
registered
office
Share capital
Votes and
ownership
2023
2022
2023
2022
UMEUS ManCo ApS
Nordhavn, DK
DKK 50,003
DKK 50,003
100%
100%
Woods Office OpCo ApS
Nordhavn, DK
DKK 650,001
DKK 650,001
100%
100%
Komp. NREP Copenhagen Resi. Fund 1 ApS
Nordhavn, DK
DKK 80,000
DKK 80,000
100%
100%
Den Studios Denmark ApS
Nordhavn, DK
DKK 50,003
DKK 50,003
100%
100%
NNSF IV IP CIV GP ApS
Nordhavn, DK
DKK 40,001
DKK 40,001
100%
100%
Komp. NREP NSF IV Investment ApS
Nordhavn, DK
DKK 40,001
DKK 40,001
100%
100%
Komp. NREP Income+ Investment ApS
Nordhavn, DK
DKK 40,001
DKK 40,001
100%
100%
NREP Income+ Investment K/S
Nordhavn, DK
DKK 0
DKK 0
100%
100%
JULI Living DK ApS
Nordhavn, DK
DKK 40,000
DKK 40,000
100%
100%
NREP NSF V Investment K/S
Nordhavn, DK
DKK 0
DKK 0
100%
100%
2150 ApS
Nordhavn, DK
DKK 40,000
DKK 40,000
100%
60%
Komplementarselskabet 2150 CIV ApS
Nordhavn, DK
DKK 40,000
DKK 40,000
100%
60%
Komplementarselskabet 2150 Investment ApS
Nordhavn, DK
DKK 40,000
DKK 40,000
100%
60%
2150 Fund II CIV K/S
Nordhavn, DK
DKK 100
DKK 100
0%
60%
2150 Concrete K/S
Nordhavn, DK
DKK 100
DKK 100
100%
60%
Komplementarselskabet 2150 Investment II ApS
Nordhavn, DK
DKK 40,000
DKK 40,000
100%
60%
Komplementarselskabet 2150 concrete ApS
Nordhavn, DK
DKK 40,000
DKK 40,000
100%
60%
Komplementarselskabet 2150 Fund II CIV ApS
Nordhavn, DK
DKK 40,000
DKK 40,000
100%
60%
Komplementarselskabet NREP NSF V Invest ApS
Nordhavn, DK
DKK 40,000
DKK 40,000
100%
100%
2150 Invest II K/S
Nordhavn, DK
DKK 100
DKK 100
100%
60%
NREP Administration ApS
Nordhavn, DK
DKK 40,001
DKK 40,001
100%
100%
NREP AS
Oslo, NO
NOK 120,000
NOK 120,000
100%
100%
NREP Ventures Co 2 AS
Oslo, NO
NOK 0
NOK 30,000
0%
100%
NREP Income+ InvestCo 124 AS
Oslo, NO
NOK 0
NOK 30,000
0%
100%
NREP Income+ InvestCo 125 AS
Oslo, NO
NOK 0
NOK 30,000
0%
100%
Umeus Norway AS
Oslo, NO
NOK 30,000
NOK 30,000
100%
100%
NREP AB
Stockholm, SE
SEK 100,000
SEK 100,000
100%
100%
NREP InvestCo 65 AB
Stockholm, SE
EUR 6,500
EUR 6,500
62%
62%
NREP Income+ Investment AB
Stockholm, SE
EUR 6,500
EUR 6,500
100%
100%
NREP NSF III Investco 126 AB
Stockholm, SE
EUR 6,500
EUR 6,500
0%
100%
NREP NSF V Investment AB
Stockholm, SE
EUR 6,500
EUR 6,500
100%
100%
NREP Poland sp. z o.o.
Warsaw, PL
PLN 2,683,900
PLN 2,683,900
100%
100%
Noli Studios Poland z o. o.
Warsaw, PL
PLN 6,560,000
PLN 4,160,000
100%
100%
NREP Germany GmbH
Frankfurt, GE
EUR 25,000
EUR 25,000
100%
100%
2150 Advisory Germany GmbH
Frankfurt, GE
EUR 25,000
EUR 25,000
100%
60%
Flins Capital Partners GMBH
Munich, GE
EUR 25,000
EUR 25,000
100%
100%
NREP Oy
Helsinki, FI
EUR 0
EUR 2,500
0%
50%
NREP Oy
Noli Studios Finland Oy
Helsinki, FI
Helsinki, FI
EUR 0
EUR 2,500
EUR 0
EUR 2,500
100%
100%
0%
100%
Noli Studios Finland Staff Pool Oy
Helsinki, FI
EUR 2,500
EUR 2,500
100%
100%
Juli Living Finland Oy
Helsinki, FI
EUR 0
EUR 0
100%
100%
Luma Equity AB
Stockholm, SE
SEK 65,000
SEK 0
100%
0%
2150 FUND II CIV AB
Stockholm, SE
EUR 6,500
SEK 0
100%
0%
34
Name
Place of
registered
office
Share capital
Votes and ownership
2023
2022
2023
2022
NREP Corporation UK Limited
London, UK
GBP 1
GBP 1
100%
100%
2150 UK Ltd
London, UK
GBP 1
GBP 1
100%
60%
NREP NSF V Feeder 1 GP Limited
London, UK
GBP 1
GBP 1
100%
100%
NREP LPF MLP S.à.r.l
Luxembourg
EUR 12,000
EUR 12,000
100%
100%
NREP LPF GP S.à.r.l
Luxembourg
EUR 12,000
EUR 12,000
100%
100%
NREP Management Company S.à.r.l.
Luxembourg
EUR 125,000
EUR 125,000
100%
100%
NREP Domus S.à.r.l.
Luxembourg
EUR 12,000
EUR 12,000
100%
100%
Nordic Strategies Fund II GP S.à.r.l
Luxembourg
EUR 12,500
EUR 12,500
100%
100%
NREP Nordic Strategies Fund III GP S.à.r.l
Luxembourg
EUR 12,000
EUR 12,000
100%
100%
NREP Nordic Strategies Fund IV GP S.à.r.l
Luxembourg
EUR 12,000
EUR 12,000
100%
100%
NREP Nordic Strategies Fund V GP S.à.r.l.
Luxembourg
EUR 20,000
EUR 20,000
100%
100%
NREP Income+ Fund GP S.à.r.l.
Luxembourg
EUR 20,000
EUR 20,000
100%
100%
NREP Income+ Fund RE GP S.à.r.l.
Luxembourg
EUR 12,000
EUR 12,000
100%
100%
2150 GP I Sarl
Luxembourg
EUR 12,000
EUR 12,000
100%
60%
NREP Fund Feeder GP S.à.r.l
Luxembourg
EUR 0
EUR 12,000
0%
100%
NREP NSF V Feeder 2 GP
Luxembourg
EUR 12,000
EUR 12,000
100%
100%
Oak Scsp
Luxembourg
EUR 0
EUR 0
100%
100%
Oak Investment Scsp
Luxembourg
EUR 2
EUR 2
100%
100%
OAK General Partner S.à.r.l
Luxembourg
EUR 23,530
EUR 23,530
100%
100%
AF IV General Partner S.à.r.l.
Luxembourg
EUR 12,000
EUR 12,000
100%
100%
AF I General Partner S.à.r.l.
Luxembourg
EUR 12,500
EUR 12,500
100%
100%
AF II General Partner S.à.r.l.
Luxembourg
EUR 12,500
EUR 12,500
100%
100%
AF III General Partner S.à.r.l.
Luxembourg
EUR 12,000
EUR 12,000
100%
100%
AF V General Partner S.à.r.l.
Luxembourg
EUR 12,000
EUR 12,000
100%
100%
2150 GP II Sarl
Luxembourg
EUR 12,000
EUR 12,000
100%
60%
2150 GP Opportunity Fund I S.à.r.l.
Luxembourg
EUR 12,000
EUR 12,000
100%
60%
2150 GP concrete I Sarl
Luxembourg
EUR 12,000
EUR 12,000
100%
60%
NREP Atlantis GP S.à.r.l.
Luxembourg
EUR 12,000
EUR 12,000
100%
100%
NREP B.V
Netherlands
EUR 50,000
EUR 50,000
100%
100%
10. Partially owned subsidiaries
Proportion of equity interest held by non-controlling interests:
Group
Name
Country of operation
2023
2022
NREP Oy
Helsinki, Finland
0%
50.2%
NREP InvestCo 65 AB
Stockholm, Sweden
62%
62%
2150 Aps
Nordhavn, Denmark
100%
60%
In 2023 the Group acquired the minority shares in 2150 ApS. Further NREP Oy was demerged into a fully owned
subsidiary and a joint venture (NREP Investment Oy).
35
11. Business Combinations
The Group did not make business combinations in 2023.
In 2022 the Group acquired control of an equity interest in a leading real estate credit specialist business consisting of Flins
Capital Providers (FCP) and the Oak fund setup (Oak) from M3 Capital Partners which is described below.
On the 17
th
of November 2021 the purchase was executed through a partnership between Urban Partners, MAA Invest AS
and Atrium Beteiligungs GmbH. On 1
st
April 2022 the Group took control over FCP and Oak. When acquiring shares the
Group acquired a group of entities, including all commitments and employees and the integrated organization to perform
its activities independently and be able to create revenues for the Group - which constitute the business.
The acquisition was accounted for as a business combination. Therefore, all transferred assets and liabilities of FCP and Oak
were valued at fair value at the final acquisition date.
Details of the purchase consideration, the net assets acquired, and goodwill are as follows:
Purchased consideration
tDKK
Cash paid in 2021
206,778
Contingent consideration
236,732
Total
443,509
Significant estimate: contingent consideration
The Contingent consideration is based on the assumption that EBITDA for the acquired entities is above EUR 6,6 million for
the financial year 2023 where the earn-out cap will be reached.
The fair value of the contingent consideration of DKK 236,732 thousand was estimated by calculating the present value of
the future expected cash flows. The estimates are based on a discount rate of 4.1% and assumed probability-adjusted
EBITDA of above EUR 6,6 million in 2023 for the acquired entities.
The assets and liabilities recognised as a result of the acquisition are as follows:
tDKK
Fair value
Facilities and equipment
138
Prepayments
323
Other current assets
3,617
Cash and cash equivalents
14,697
Liabilities
(10,389)
Net identifiable assets acquired
8,386
Add: Goodwill
321,847
Add: Customer relationships
167,976
Add: Brand
1,029
Less: Deferred tax liabilities
(55,728)
Net assets acquired
443,509
The goodwill is attributable to the acquired business. It will not be deductible for tax purposes.
Group
tDKK
2023
2022
Less: Balances acquired
Cash and cash equivalents
-
14,697
Net cash - investing activities
-
14,697
If the purchase of Flins Capital Providers and the Oak fund setup had been consolidated from 1st January 2022, the impact
on the profit would have been tDKK 11,014.
36
12. Investments in Joint Ventures
Group
Parent
tDKK
2023
2022
2023
2022
Cost at 1 January
16,625
9,445
16,625
9,445
Additions for the year
29,559
7,180
4,372
7,180
Cost at 31 December
46,184
16,625
20,997
16,625
Value adjustments at 1 January
(14,898)
(8,501)
(14,898)
(8,501)
Exchange adjustment
(6)
-
(7)
-
Income from carried interest in joint ventures related
to Group managed funds
4,797
-
-
-
Net profit/loss for the year
(3,554)
(6,397)
14,552
(6,397)
Dividend to the parent company
(18,105)
-
(18,105)
-
Transfer
8,673
-
-
-
Value adjustments at 31 December
(23,093)
(14,898)
(18,458)
(14,898)
Carrying amount at 31 December
23,091
1,727
2,539
1,727
Name
Place of registered office
Share capital
Votes and
ownership
NREP-TF ApS
Nordhavn, DK
DKK 60,002
50%
Plushusene Management ApS
Horsens, DK
DKK 1,700,000
50%
NREP Investment OY
Helsinki, FI
DKK 0
50%
Joint ventures are recognised using the equity method so that the carrying amount of the joint venture constitutes the
Group’s proportional share of the net assets of the enterprise.
In addition, share of promote is recognised as part of “income from carried interest in joint ventures related to Group
managed fund”, which comprise the fair value movement of the other investment directly or indirectly held by the Group.
See Note 30 “Accounting policies for the Group” for further information.
37
13. Investments in associates
Group
Parent
tDKK
2023
2022
2023
2022
Cost at 1 January
28,593
244,767
9,452
216,360
Exchange adjustment
(133)
(2,120)
-
-
Additions for the year
-
33
-
19
Disposals for the year
(428)
(7,156)
(11)
-
Transfers for the year
(100)
(206,783)
-
(206,778)
Other adjustments
940
(149)
(1)
(149)
Cost at 31 December
28,872
28,593
9,440
9,452
Value adjustments at 1 January
106,359
107,572
3,682
4,152
Exchange adjustment
581
1,950
1
1
Income from carried interest in associates related to
Group managed funds
(82,402)
2,115
-
-
Share of result other
(1,118)
(285)
(1,093)
(471)
Dividends
(4,913)
(9,982)
-
-
Other adjustments
1,120
6,952
-
-
Transfer to Joint Venture
(13,972)
(1,963)
Disposals
(13,973)
-
-
-
Value adjustments at 31 December
(8,318)
106,359
2,590
3,682
Carrying amount at 31 December
20,554
134,951
12,030
13,134
Investments in associates for 2023 and 2022 are specified as follows:
Share capital
Votes and
ownership
Place of
registered
office
2023
2022
2023
2022
Investment in Urban Partners Fund
NREP Co-Investment Nordhavn K/S
DK
DKK 12,000,000
DKK 12,000,000
48%
48%
Komp. NREP Co-Investment Nordhavn ApS
DK
DKK 60,000
DKK 60,000
48%
48%
Ejendomsselskabet Hellebro A/S
DK
DKK 17,500,000
DKK 17,500,000
20%
20%
NREP InvestCo 3 AB
SE
SEK 100,000
SEK 100,000
0%
23%
NREP InvestCo 15 AB
SE
EUR 6,500
EUR 6,500
40%
39%
NREP InvestCo 14 AB
SE
EUR 6,500
EUR 6,500
36%
36%
NREP NSF III InvestCo 84 AB
SE
EUR 6,500
EUR 6,500
25%
25%
NREP InvestCo 95 AB
SE
EUR 17,333
EUR 17,333
33%
33%
NREP InvestCo 63 AB
SE
EUR 6,500
EUR 6,500
30%
30%
NREP NSF III InvestCo 94 AS
NO
NOK 35,548
NOK 35,548
29%
29%
NREP InvestCo 44 AS
NO
NOK 99,425
NOK 99,425
22%
22%
NREP NSF IV Investment S.à.r.l
LUX
EUR 28,500
EUR 28,500
42%
42%
Associates are entities in which Urban Partners has significant influence but not control. All associates are recognised using
the equity method so that the carrying amount of an associate constitutes the Group’s proportional share of the net assets
of the enterprise.
The share of promote is recognised as part of “Income from carried interest in associates related to Group managed
funds”, which comprise the fair value movement of the other investment directly or indirectly held by the Group. See Note
30 “Accounting policies for the Group” for further information.
38
14. Other financial assets
Group
Parent
tDKK
Other non-
current
investments
Other non-
current
receivables
Non-current
receivables
from group
enterprises
Other non-
current
investments
Other non-
current
receivables
2023
Cost at 1 January
132,788
225,756
34,454
49,158
216,219
Exchange adjustments
370
-
-
-
-
Additions for the year
27,425
47,231
7,613
16,537
47,029
Disposals for the year
(6)
(181,350)
(18,687)
-
(181,350)
Other adjustments
(69)
-
-
-
-
Cost at 31 December
160,508
91,637
23,380
65,695
81,898
Value adjustments at 1 January
185,023
-
-
-
-
Exchange adjustment
(533)
-
-
-
-
Income from carried interest in other
investments related to Group
managed funds
(62,041)
-
-
-
-
Fair value adjustment other
(7,282)
-
-
-
-
Dividends
(48,876)
-
-
-
-
Transfer to Joint Venture
(19,632)
-
-
-
-
Disposals
(19,632)
Other adjustments
(2,099)
-
-
-
-
Value adjustments at 31 December
24,928
-
-
-
-
Impairment at 1 January
-
-
10,567
7,878
-
Impairment for the year
-
-
(6,664)
-
-
Impairment at 31 December
-
-
3,903
7,878
-
Carrying amount at 31 December
185,436
91,637
19,477
57,817
81,898
Other financial assets are measured at fair value with net changes in fair value recognised in the statement of profit or loss.
This category includes investments in equity instruments that do not meet the criteria of a subsidiary or an associate. These
investments, included in other non-current financial assets are presented at fair value, including the fair value of the
carried interests. The profit or loss arising from the fair valuation as well as the carried interest calculation are presented in
financial income and “income from carried interests” respectively.
See Note 30 “Accounting policies for the Group” for further information.
39
Group
Parent
tDKK
Other non-
current
investments
Other non-
current
receivables
Non-current
receivables
from group
enterprises
Other non-
current
investments
Other non-
current
receivables
2022
Cost at 1 January
94,419
13,111
26,323
25,336
12,934
Exchange adjustments
(5,361)
-
-
-
-
Additions for the year
47,342
215,826
47,990
23,822
206,465
Disposals for the year
(3,616)
(3,180)
(39,859)
-
(3,180)
Transfer for the year
5
-
-
-
-
Cost at 31 December
132,788
225,756
34,454
49,158
216,219
Value adjustments at 1 January
187,461
-
-
-
-
Exchange adjustment
1,139
-
-
-
-
Fair value adjustment, Urban
Partners managed funds net of
payments
(16,629)
-
-
687
-
Fair value adjustment other
14,148
-
-
-
-
Dividends
(6,377)
-
-
(687)
-
Transfer
1,963
-
-
-
-
Other adjustments
3,318
-
-
-
-
Value adjustments at 31 December
185,023
-
-
-
-
Impairment at 1 January
-
-
26,104
7,878
-
Impairment losses for the year
-
-
(15,537)
-
-
Impairment at 31 December
-
-
10,567
7,878
-
Carrying amount at 31 December
317,811
225,756
23,887
41,280
216,219
Other non-current investments represent investments that do not meet the definition of associates, joint ventures, or
subsidiaries. These investments are accounted for at fair value through profit and loss.
Page 40 of 65
15. Receivables
Group
Parent
tDKK
2023
2022
2023
2022
Trade receivables
112,542
206,783
30,290
115,111
Receivables from group enterprises
-
-
9,911
415,857
Other current receivables
230,422
112,158
102,660
89,091
Total receivables
342,964
318,941
142,861
620,059
Trade receivables
Allocation of net trade receivables by maturity period are as follows:
Group
Parent
tDKK
2023
2022
2023
2022
Up to 30 days
30,602
116,077
3,556
51,958
Between 31 and 90 days
59,627
61,853
13,734
48,219
Between 91 and 365 days
22,313
28,852
13,000
14,934
Net receivables at 31 December
112,542
206,782
30,290
115,111
Expected credit losses are based on a provision matrix,
considering the Group’s historic credit losses combined
with forward looking information that is expected to
affect the loss rates.
As the Group has no history of nor specific expectations
of material issues on the recoverability of receivables,
and due to the reliable substance in the agreements for
receivables, the expected credit loss on management
fee and service corporate fee is considered immaterial.
Receivables are written off when they are assessed as
uncollectible.
Trade receivables are primarily related to asset
management fees charged from Urban Partners to NREP
fund assets and fund limited partners.
Other current receivables
Other current receivables consist of receivables from
employees, affiliated companies and accrued rental
income.
The Group considers that the carrying amount of trade
and other receivables approximate their fair value.
There is no concentration of credit risk with respect to
specific receivables.
16. Prepayments / Other current financial assets
Other current assets include mainly prepayments. The
prepayments relate to prepaid insurance, platform
licenses, other accounting and consultancy fees related
to Urban Partners Group managed funds.
41
17. Share base payment
As per 31 December 2023, the Group has one
outstanding share-based incentive plan.
Description of the plan
At the general assembly 10th of August 2020, Urban
Partners has approved the implementation of a warrant
program for certain partners and employees of the
Urban Partners as well as the issuance of 18,076
warrants. The warrants to which the participants
subscribe do not carry a right to vote, receive dividends
or any other rights associated to a shareholder.
On 10th August 2020 18,076 warrants were granted.
The key features of the warrants granted under the plan
are as follows:
• Each participant may subscribe a number of
warrants against a cash payment of DKK 88.61
per warrant. The price of DKK 88.61 is assumed
to be the fair value of the warrant at grant date
• Issued warrants vest equally in four tranches,
being 1 January 2021, 1 January 2022, 1 January
2023 and 1 January 2024 (final date of vesting)
• If the participant exists Urban Partners prior to
the final date of vesting, any unvested warrants
will lapse without further notice or
compensation
• At exercise, each warrant may be converted into
1 share in Urban Partners with a nominal value
of DKK 1 against a cash payment of DKK 1,108,
irrespectively of the time of vesting or exercise.
• The warrants may be exercise in a period of
thirty days from the relevant date of vesting (1
January 2021/2022/2023/2024), although any
unvested warrants shall be vested no later than
three months from the final date of vesting (1
January 2024).
18,076 warrants are still outstanding as of December 31,
2023.
Accounting for Share-Based Payment
The warrants are issued in addition to the normal
remuneration of the employee and constitute an
incentive for the partners and employees to remain in
the employment of Urban Partners. A direct
measurement of the services by the participants is
measured at the fair value of the warrants granted. In
2020, the partners and employees paid DKK 88.61 per
warrant and this value represents the fair value of the
warrants at grant date. Therefore, there is no specific
fair value gain given to the employees at grant date and
by that no cost to recognise.
The weighted average remaining contractual life for the warrants outstanding as of 31 December 2023 is 1 year (2 years in
2022).
The weighted average fair value of warrants granted during the year was DKK 0 in 2023 and DKK 0 in 2022.
Group
Year ended December 31, 2023
Plan 2023
Number of warrants granted
18,076
Weighted average fair values at the measurement date per warrant (DKK)*
1,108
Dividend yield
4.0%
Risk–free interest rate
0.0%
Expected life of warrants (years)
4
Weighted average share price (EUR) per share
148.50
Exercise price (EUR)
148.50
Model used
Actual transaction
*DKK equivalent of EUR 148.0 has been based on EUR/DKK rate of 7.4584 (30. April 2020)
Market price per share is based on the actual share
transaction with third party in August 2020. No volatility
has been established on future equity.
The warrants have been purchased at fair value, why no
expense has been recognised in staff costs regarding the
incentive program.
Page 42 of 65
18. Share capital
Dividends
The Board of Directors has not proposed dividend for
2023 (2022: DKK 0)
Capital management
The Group’s objectives when managing capital are to
safeguard the Group’s ability to continue as a going
concern in order to provide returns for shareholders and
benefits for other stakeholders and to maintain an
optimal capital structure to reduce cost of capital.
In order to maintain or adjust the capital structure, the
Group may adjust the amount of dividends paid to
shareholders, return capital to shareholders, issue new
shares or sell assets to reduce debt. The Group is an
alternative investment fund manager (AIFM) through
two of its legal entities NREP AB in Sweden and Urban
Partners Management Company S.A. in Luxembourg
which are subject to supervision by the Swedish
Financial Supervisory Authority (SFSA) and the Financial
Sector Supervisory Commission (CSSF) respectively.
Capital increase
In 2023 new shares was issued resulting in a capital
increase of DKK 14 thousand (2022: DKK 7 thousand).
The share capital has developed as follows:
Group
tDKK
2023
2022
2021
2020
2019
Share capital at 1 January
1,366
1,359
1,359
1,000
1,000
Capital increase
14
7
-
359
-
Share capital at 31 December
1,380
1,366
1,359
1,359
1,000
Number of shares outstanding:
Parent
Shares tDKK
2023
2022
Shares issued at 1 January
1,366
1,359
Shares issued during the year
14
7
Total number of shares
1,380
1,366
Holding of Treasury shares
(55)
-
Total number of outstanding shares at 31 December
1,325
1,366
tDKK
Numbers of
shares
Transaction
price
tDKK
% of issued
shares
Treasury shares at 1 January
-
-
-
Purchased/sold
-
-
-
Treasury shares at 31 December 2022
-
-
-
Purchase of treasury shares
59,659
192,717
4.3%
Sales of treasury shares
(4,894)
(14,571)
0.3%
Treasury shares at 31 December 2023
54,765
178,146
4%
In 2023 Urban Partners A/S repurchased treasury shares of DKK 114.7 million from NREP Partner Holding ApS and DKK 78.0
million from NREP Partners Investment ApS due to restructuring. Part of these treasury shares are sold to BJHS Invest ApS
at the amount of DKK 14.6 million.
43
19. Minority interests
During May 2023, NREP Oy was demerged into two new entities, NREP Oy and NREP Investment Oy. No consideration has
given to owners apart from shares in NREP Oy and NREP Investment Oy. The demerger has been carried out at book value.
Subsequent to the demerger, Urban Partners sold 0,2% of NREP Investment Oy. Which resulted in a decrease of the share
of non-controlling with DKK 29.9 million under the Group’s Equity, whereof DKK 30.2 million was related to promote. In
addition, Urban Partners acquired the remaining 49,8% shares of NREP Oy.
20. Proposed distribution of profit, Parent
Parent
tDKK
2023
2022
Reserve for net revaluation under the equity method
27,847
(26,535)
Retained earnings
(186,122)
34,807
Total
(158,275)
8,273
21. Financial assets and liabilities
i. Borrowings
Group
Parent
tDKK
2023
2022
2023
2022
Long-term part
288,397
109,317
288,397
109,317
Short-term part
20,273
93,139
20,273
93,139
Carrying amount at 31 December
308,670
202,456
308,670
202,456
As of December 31, 2023, the Group has borrowing facilities available. The undrawn borrowing facilities available on 31
December 2023 amounted to DKK 203.3 million (2022: DKK 204.3 million). Uncommitted bank borrowing facilities are
normally reaffirmed by the bank annually, although they can theoretically be withdrawn at any time.
Danske Bank working capital facility is unsecured credit line and Novo Term Loan Facilities are both secured loan facilities.
ii. Other payables
Payments due within 1 year are recognised in short-term debt. Other debt is recognised in long-term debt. The debt falls
due for payment as specified below:
Group
Parent
tDKK
2023
2022
2023
2022
Fund related accruals
-
78,201
-
62,177
Long-term part
-
78,201
-
62,177
Prepayments
10,696
4,342
-
-
Vat liabilities
13,910
20,748
-
-
Employee liabilities
207,760
145,345
78,589
58,685
Fund related accruals
120,612
67,873
-
-
Other short-term payables
281,813
204,038
31,961
30,924
Short-term part
634,791
442,346
110,550
89,609
Carrying amount at 31 December
634,791
520,547
110,550
151,786
The increase in short term payables, between 2023 and 2022, is mainly a result of increased activity and fund related
accruals.
44
iii. Movements
The movements of financial liabilities are as follows:
Group
tDKK
Beginning of
year
Cash flows
Non-cash
changes
End of year
2023
Borrowings
202,456
106,130
84
308,670
Total
202,456
106,130
84
308,670
2022
Borrowings
51,050
151,406
-
202,456
Total
51,050
151,406
-
202,456
iv. Fair value
The Group measures the fair value of its financial assets
and financial liabilities using a fair value hierarchy. A
financial instrument’s classification within the fair value
hierarchy is based upon the lowest level of input that is
significant to the fair value measurement. Three levels
of inputs may be used to measure fair value. The
different levels of the fair value hierarchy are defined as
follows:
Level 1: Quoted prices (unadjusted) in active markets for
identical assets or liabilities
Level 2: Inputs other than quoted prices included within
Level 1 that are observables for the asset or liability,
either directly or indirectly; and
Level 3: Unobservable inputs for the asset or liability
The following is a comparison, by class, of the carrying
amounts and fair values of the financial assets and
liabilities, other than those with carrying amounts that
are reasonable approximation of fair value:
Both for Group and the Parent, management assessed
that the fair value of cash and cash equivalents, trade
accounts receivable, trade accounts payable, accrued
compensation and benefits, and other accruals
approximate their respective carrying values due to their
short-term maturities.
The fair values of the Group’s interest-bearing loan are
determined by using the DCF method using discount
rate that reflects the issuer’s borrowing rate as at the
end of the reporting period. Their fair values are the
same as the carrying amounts.
The other non-current investments and the carried
interest portion of the associates are measured at fair
value through the consolidated statement of
comprehensive income.
45
Group
2023
2022
tDKK
Carrying
amount
Fair value
Carrying
amount
Fair value
Loans and receivables at amortised cost:
Trade receivables
112,542
112,542
206,783
206,783
Other receivables
322,059
322,059
337,914
337,914
Cash and cash equivalents
295,113
295,113
256,694
256,694
Financial assets at fair value through profit/loss:
Other non-current investments
185,436
185,436
317,811
317,811
Financial assets
915,150
915,150
1,119,202
1,119,202
Carried at amortised cost:
Other payables
634,792
634,792
520,547
520,547
Borrowings
308,670
308,670
202,456
202,456
Trade payables
252,762
252,762
276,087
276,087
Provisions
13,856
13,856
53,651
53,651
Financial liabilities
1,210,080
1,210,080
1,052,741
1,052,741
Parent
2023
2022
tDKK
Carrying
amount
Fair value
Carrying
amount
Fair value
Loans and receivables at amortised cost:
Trade receivables
30,290
30,290
115,111
115,111
Other receivables
184,558
184,558
305,311
305,311
Receivables from group enterprises
29,388
29,388
439,745
439,745
Cash and cash equivalents
540
540
36
36
Financial assets at fair value through profit/loss:
Other investments
57,817
57,817
41,280
41,280
Financial assets
302,593
302,593
901,483
901,483
Carried at amortised cost:
Borrowings
308,670
308,670
202,456
202,456
Trade payables
211,354
211,354
268,113
268,113
Other payables
110,550
110,550
151,787
151,787
Payables to group enterprises
253,471
253,471
528,940
528,940
Financial liabilities
884,045
884,045
1,151,296
1,151,296
46
Group
tDKK
Quoted
prices
(Level 1)
Significant other
observable
inputs
(Level 2)
Significant
unobservable
inputs
(Level 3)
Total
Other investments
-
-
185,436
185,436
Deferred purchase price
(205,549)
(205,549)
Carrying amount 31 December 2023
-
-
(20,113)
(20,113)
Other investments
-
-
317,811
317,811
Deferred purchase price
(243,211)
(243,211)
Carrying amount 31 December 2022
-
-
74,600
74,600
Deferred purchased price is related to the business acquisition in 2022. The fair value is calculated based on a WACC
4.057% per anno. This is based on CIBOR 6 month with addition of risk premium.
The following table presents the change in level 3 items for the years ended 31 December 2023 and 31 December 2022:
Group
tDKK
2023
2022
Opening at 1 January
74,600
281,880
Additions from investments related to Group managed funds
27,425
47,342
Transfers and other adjustments from investments related to Group managed funds
(41,601)
(4,516)
Income from investments in other investments related to Group managed funds
(62,041)
(16,629)
Income from investments in other investments
(7,282)
14,148
Distributions from investments in associates related to Group managed funds
(48,876)
(6,377)
Transfer
-
1,963
Addition deferred purchase price
-
(243,211)
Reversal of contingent consideration of purchase price
37,662
-
Closing balance 31 December
(20,113)
74,600
47
22. Financial risk management
The Group is subject to the following market risks:
• Market risks
• Foreign exchange risks
• Interest rate risk
• Liquidity risk
• Credit risk
The Group regularly defines, monitors, and manages its
external risks (including foreign exchange risk, credit
risk, investment risk, liquidity risk, reputation risk etc.) to
align with the risk appetite of its stakeholders.
The valuation of Urban Partners’ co-investments in
Urban Partners managed funds are inherently linked to
the valuation of real estate properties (Nrep), Venture
Capital (2150) and credit investments (Velo). The value
of such investments is subject to market conditions and
is estimated with some degree of uncertainty. All real
estate properties are independently valued at least
every 6 months and all investment strategies are subject
to quarterly valuation processes by a regulated entity to
assess the holding value of its investments.
i. Market risks
Management fees received from funds are primarily
based on the committed or deployed capital. In
Management's assessment, the risk profile of the Urban
Partners Group is normal for this Market.
The value assessments of properties held directly or
indirectly through equity investments are inherently
subject to some degree of uncertainty. In order to limit
the risk as much as possible, all relevant properties have
been assessed by external valuers, who are external
parties independent of the company.
The fair value of the properties has been determined on
discounted cash flows using equivalent yields between
3.5% and 8.6% (2022: 3.6% and 8.2%) depending on the
type and location of the property. These inputs include:
• Future rental cash inflows based on the actual
location, type and quality of the properties and
supported by the terms of any existing lease,
other contracts or external evidence such as
current market rents for similar properties.
• Discount rates reflecting current market
assessments of the uncertainty in the amount
and timing of cash flows.
• Estimated vacancy rates based on current and
expected future market conditions after expiry
of any current lease.
• Maintenance costs including necessary
investments to maintain functionality of the
property for its expected useful life.
• Capitalisation rates based on actual location, size
and quality of the properties and taking into
account market data at the valuation date.
• Terminal value taking into account assumptions
regarding maintenance costs, vacancy rates and
market rents.
ii. Foreign exchange risks
The Group primarily receives management fees in EUR,
whereas the Group's expenses are distributed on DKK,
SEK, NOK, EUR and PLN. . The most important exchange
rates in relation to risk exposure are SEK, NOK, PLN and
GBP. EUR is a currency with large exposure, but the risk
is deemed limited, due to DKK being pegged to EUR. The
Group policy related to foreign exchange risks is not to
use hedging instruments as the main part is covered for
operating purposes by matching income and expenses
in the same currency.
The following table shows the impact on the Group's net
profit in the event of a 10% fluctuation in the main
currencies. The fluctuation of 10% constitutes the
Management’s assessment of a realistic exchange rate
development within the main currencies. A similar fall in
the exchange rate would have had the opposite effect.
The financial instruments comprised by the sensitivity
analysis include trade receivables, cash, payables, trade
payables and intercompany balances. The sensitivity
analysis does not take into consideration any translation
effect from functional currency to presentation
currency.
48
Possible change in
exchange rate
(+/-)
Hypothetical
change in
profit/loss
Hypothetical
change in
equity
tDKK
2023
SEK/DKK
10%
4,923
14,072
NOK/DKK
10%
(100)
562
PLN/DKK
10%
506
614
GBP/DKK
10%
991
1,353
Possible change in
exchange rate
(+/-)
Hypothetical
change in
profit/loss
Hypothetical
change in
equity
tDKK
2022
SEK/DKK
10%
8,423
8,343
NOK/DKK
10%
(33)
428
PLN/DKK
10%
745
529
GBP/DKK
10%
2,079
688
iii. Interest rate risks
The interest rate risk of Urban Partners A/S and its
affiliates consists mainly of external financing, which is
split between floating and fixed rate instruments. On the
reporting date the floating rate interest-bearing
liabilities amounted to DKK 131.9 million and fixed rate
interest-bearing liabilities to DKK 172.2 million. At the
end of 2023, 61% of the non-current liabilities were
fixed-rate.
The Urban Partners Group might be indirectly exposed
to interest rate risk through the Funds' performance.
Funds have a dedicated policy for their own interest rate
risk exposures.
The Fund's interest rate risks principally arise from long-
term and short-term borrowings. Borrowings issued at
variable rates expose the Funds to cash flow interest
rate risk. To manage this, the Funds have entered into
interest rate swaps and interest rate caps. For the
interest rate swaps the Funds agrees to exchange, at
specified intervals, the difference between fixed and
variable rate interest amounts calculated by reference
to an agreed upon notional principal amount. Interest
rate caps cap the floating interest at a specific rate.
iv. Liquidity risk
The Group manages its liquidity risk by monitoring the
changes in working capital and by ensuring adequate
funding. Based on the Group's cash management
principle, the Group's cash is accumulated in dedicated
bank accounts. Risk analysis and designing of risk
management plans are conducted at the top
management level. The Group's liquidity risk policy is
based on a conservative approach, whose main
objective is to secure the safeguarding of the cash flows
generated from the operations to ensure sufficient
liquidity enabling timely settlement of the liabilities
undertaken.
At 31 December 2023 the Group has a committed
undrawn borrowing facility of DKK 203.3 million (2022:
DKK 204.3 million) that may be available for future
operating activities and to settle capital commitments.
The table below analyses the financial liabilities into
relevant maturity groupings based on the remaining
period at the balance sheet date to the contractual
maturity date. The amounts disclosed in the table are
the contractual undiscounted cash flows.
Page 49 of 65
Group
tDKK
Less than
1 year
Between 1
and 5 years
More than
5 years
Total
End 2023
Leases
28,014
65,636
1,538
95,188
Borrowings
20,273
-
-
20,273
Other payables
659,965
339,507
-
999,472
Trade payables
252,763
-
-
252,763
Total
961,015
405,143
1,538
1,367,696
End 2022
Leases
32,422
24,487
8,998
65,907
Borrowings
93,139
-
-
93,139
Other payables
442,346
226,980
-
669,326
Trade payables
276,087
-
-
276,087
Total
843,994
251,467
8,998
1,104,459
v. Credit risk
Credit risk is the risk that one party to a financial
instrument will cause a financial loss for the other party
by failing to discharge an obligation. The Group has no
significant concentrations of credit risk.
Credit risk arises from cash and cash equivalents held at
banks, trade receivables and other receivables. Credit risk
is managed on a group basis. The Group does not monitor
the credit quality of trade and other receivables on an
ongoing basis. Cash balances are held only with financial
institutions with a Moody’s or Fitch credit rating of Aa3 or
above, except in cases where amounts are immaterial.
Credit risk arises principally from other receivable, trade
receivables and cash and cash equivalents.
Urban Partners A/S monitors credit risk of any financial
counterparty on an annual basis and performs initial
financial due diligence.
The Group’s maximum exposure to credit risk by class of financial asset is as follows:
Group
tDKK
2023
2022
Trade receivables
112,542
206,783
Other receivables
230,422
112,158
Other non-current receivables
91,637
225,756
Cash and Cash Equivalents
295,112
256,694
Cash and cash equivalents and deposits were placed with financial institutions whose ratings are as follows:
Group
tDKK
2023
2022
Financial Institution
Rating Agency
Rating
BBH *
Fitch
A+
80,670
47,373
Danske Bank
Moody's
A3
39,173
42,261
Nordea Bank
Moody's
Aa3
6,156
17,094
RBSI
Moody’s
A1
83,843
93,501
Commerzbank
Moody’s
A2
20,404
25,500
ING
Moody’s
A1
60,192
23,491
Nykredit
Moody’s
A2
1,291
-
Other banks
Moody's/Fitch
-
3,383
7,474
295,112
256,694
* Acting as an intermediary for HSBC, Nordea Bank Denmark, and Nordea Bank Norway
50
The ratings for financial institutions with which the
Group does business in multiple countries are the same
for all locations of that institution.
Further details on the Group’s credit risk and the related
expected credit loss for rent and service charge
receivables and debt investments are included in note
15 respectively.
23. Related parties
The transactions were carried out with related parties during the year and outstanding balance in relation to transactions
at the end of the reporting period:
Group
tDKK
2023
2022
Transaction with Novo Holdings A/S:
Loan take during the year
(179,080)
(109,317)
Loans
(288,397)
(109,317)
Interest paid
(16,321)
(4,796)
Transaction with TBL Holding ApS:
Accounts receivables
302
-
Other income
1
-
Other expenses
(1)
-
Transaction with AGE Holding ApS:
Loans
7,603
7,437
Other income
155
1
Transaction with NREP Partner Holding ApS:
Purchase of treasury share
(114,722)
-
Transaction with NREP Partner Investment ApS:
Purchase of treasury share
(77,995)
-
Transaction with BJHS Invest ApS:
Sales of treasury share
14,571
-
Transactions with other related parties:
Investments (net of disposal)
29,131
57
Dividends received
(23,018)
(9,982)
Account receivables
76,380
41,420
Accounts payables
(65)
(3,711)
Other income
85,497
3,360
Other expenses
(329)
(2,323)
51
Parent
tDKK
2023
2022
Transactions with other related parties:
Treasury shares purchased
(192,717)
-
Subsidiaries
-
-
Joint Ventures
-
-
Associates
-
-
Other
(192,717)
-
Treasury shares sold
14,571
-
Subsidiaries
-
-
Joint Ventures
-
-
Associates
-
-
Other
14,571
-
Investments (net of disposals)
67,639
506,664
Subsidiaries
63,278
499,465
Joint Ventures
4,373
7,180
Associates
(11)
19
Other
-
-
Dividends received
(18,105)
-
Subsidiaries
-
-
Joint Ventures
(18,105)
-
Loans
(328,481)
(90,762)
Subsidiaries
(84,888)
(108,414)
Joint Ventures
39,239
13,934
Associates
3,442
2,095
Other
(286,274)
1,623
Accounts receivables
10,295
296,191
Subsidiaries
9,911
275,904
Joint Ventures
-
20,285
Associates
-
2
Other
384
-
Accounts payables
(149,106)
(339,831)
Subsidiaries
(149,106)
(336,121)
Joint Ventures
-
(3,711)
Associates
-
-
Other
-
-
Interest received
3,069
1,862
Subsidiaries
2,469
1,472
Joint Ventures
515
300
Associates
42
31
Other
42
59
Interest paid
(27,075)
(9,274)
Subsidiaries
(10,754)
(9,274)
Joint Ventures
-
-
Associates
-
-
Other
(16,321)
-
Revenue
306,047
382,746
Subsidiaries
302,676
380,820
Joint Ventures
3,305
1,925
Associates
-
-
Other
66
-
Other expenses
(145,120)
(160,694)
Subsidiaries
(145,633)
(158,371)
Joint Ventures
513
(2,322)
Associates
-
-
52
As regards to the Interests in subsidiaries, joint venture and associates reference is made to Note 9 “Investments in
subsidiaries", Note 12 “Investments in Joint Ventures" and Note 13 “Investments in associates" respectively.
And as regards to the Key Management Compensation reference is made to note 2 staff expenses and note 17 share based
payment.
Ownership
The following shareholders are recorded in the Company's register of shareholders as holding at least 5% of the votes or at
least 5% of the share capital:
• Two Degrees UP ApS, Højmarksvej 26, 8270 Højbjerg
• Doughnut Capital UP ApS, Højmarksvej 26, 8270 Højbjerg
• NREP Partner Holding ApS, Højmarkvej 26, 8270 Højbjerg
• NREP Partners Investment ApS, Højmarksvej 26, 8270 Højbjerg
• Novo Holdings A/S, Tuborg Havnevej 19, 2900 Hellerup
24. Contingent assets, liabilities and other financial obligations
Group
The Group companies are jointly and separately liable for tax on the jointly taxed incomes etc of the Group. The total
amount of corporation tax payable is disclosed in the Annual Report. Urban Partners A/S is the management company of
the joint taxation purposes for the Danish joint taxation. Moreover, the group companies are jointly and severally liable for
Danish withholding taxes by way of dividend tax and tax on unearned income. Any subsequent adjustments of corporation
taxes and withholding taxes may increase the Company’s liability.
The Group has entered into binding commitments to invest further EUR 3,30 million (2022 : EUR 5,4 million) into 2150
Sustainability Fund I SCSp and 3,16 million (2022 : EUR Nil ) into 2150 Urban Tech Sustainability Fund II SCSp.
The Group guarantees as a surety guarantor as a party to the obligations that NREP-TF ApS assumes in accordance with the
Tunnelfabrikken Consortium Agreement.
Parent
Urban Partners A/S has issued a letter of comfort for selected subsidiary companies in order to be in compliance with going
concern requirement.
Urban Partners A/S holds DKK 39.0 million (2022: DKK 13.5 million) of operating lease liability that primarily relates to office
leases as at the end of 2023.
25. Audit Fee
Group
Parent
tDKK
2023
2022
2023
2022
Audit fee, PWC
2,826
2,399
1,851
1,294
Other non-audit fees
642
534
642
286
Tax advisory fee
257
435
257
435
Total fee
3,725
3,368
2,750
2,015
53
26. Provision
Provision in 2023 relates to restructuring.
Since December 2020, Urban Partners has been in a
dispute with the tax Authorities in Sweden concerning
VAT treatment. In 2023 Urban Partners finally received
a ruling which was in line with the expectations and
provision.
27. Subsequent event
In mid-March 2024 Urban Partners paid the 2
nd
contingent consideration to the Flins Capital partners
which amounted to EUR 26.3 million. The 3
rd
and last
payment are planned for 2026.
No further events have occurred after the balance date,
which would influence the evaluation of this Annual
Report.
28. General Information
Urban Partners is a vertically integrated European
investment fund manager established on 2 November
2005, providing access to investors, via the Funds it
advises, into several investment strategies being:
Nrep - value add (NSF) and income focussed (NIP) real
estate equity investments focussed on the Nordics,
Germany and Poland;
Velo – income focussed real estate credit investments
focussed on the Nordics and Germany;
2150 – Venture capital investments focussed on the
urban and tech landscape globally;
All of which are anchored in solving the problems of our
cities. Urban Partners maintains a local presence in all its
main investment geographies.
Urban Partners A/S has its registered office at DK-2150
Nordhavn, Denmark.
29. Basis of Preparation
The Consolidated Financial Statements of the Urban
Partners Group for 2023 have been prepared in
accordance with the IFRS Accounting Standards as
adopted in EU and additional Danish disclosure
requirements. The financial Statements of Urban
Partners A/S (the Parent Company) have been prepared
in accordance with the Danish Financial Statements Act.
30. Accounting Policies for the Group
Statement of compliance
The financial statements of the Group for 2023 have been
prepared in accordance with IFRS Accounting Standards
as adopted by the European Union and additional Danish
disclosure requirements.
The accounting policies are consistent with those of last
year. Minor reclassifications have been made to the
comparative numbers.
The Group and Parent Company Financial Statements for
2023 are presented in thousand DKK.
Comprehensive Income and Cash Flow Statement
The Group has elected to present a single statement of
comprehensive income and presents its expenses by
nature. The Group reports cash flows from operating
activities using the indirect method. Financial income
received from joint ventures and associates etc., and
financial expenses paid on loans is presented within
financing activities in the cash flow statement. The
acquisitions and disposals of investments are disclosed as
cash flows from investing activities because this most
appropriately reflects the Groups business activities.
54
Preparation of the Consolidated Financial Statements
The consolidated financial statements include the
accounts of Urban Partners A/S, and all subsidiaries
controlled by Urban Partners A/S. Control is assumed
when the Group is exposed to, or has rights to, variable
returns from its involvement with the entity and has the
ability to affect those returns through its power over the
entity. Subsidiaries are fully consolidated from the date
on which control is transferred to Urban Partners A/S.
They are deconsolidated from the date that control
ceases. In assessing control, potential voting rights that
are substantive, are considered.
Enterprises in which the Group has shared control are
classified as joint ventures.
Enterprises in which the Group holds between 20% and
50% of the votes and exercises significant influence but
not control are classified as associates.
On consolidation, items of a uniform nature are
combined. Elimination is made of intercompany income
and expenses, shareholdings, dividends, and accounts as
well as of realised and unrealised profits and losses on
transactions between the consolidated enterprises.
The Parent Company’s investments in the consolidated
subsidiaries are set off against the Parent Company’s
share of the net asset value of subsidiaries stated at the
time of consolidation.
Funds
Each Urban Partners fund, being composed of one or
more limited Partnerships (or the equivalent) is managed
by a general partner and/or a manager (jointly “Fund
Manager”). The Fund Manager is a direct or indirect
subsidiary of Urban Partners A/S. The authority and
powers of the Fund Manager are defined in the Limited
Partnership Agreement (or similar).
Determining whether or not a Fund Manager should
consolidate its managed funds is based on judgement of
whether the Fund Manager is acting as a principal or an
agent to the fund for accounting purposes. The
assessment of the Groups expected level of return is
based on the funds’ performance, i.e. the variable
returns. Should a fund generate variable return Group
would be entitled to between 8 and 31 percent of the
variable return, which is not considered to meet the
control criterion in IFRS on link between power and
return. Instead, Urban Partners Group is considered to be
an agent in relation to the fund investors, for accounting
purposes and, accordingly the funds are not
consolidated.
Investment in associates and joint ventures
An associate is an entity over which the Group has
significant influence. Significant influence is the power to
participate in the financial and operating policy decisions
of the investee but is not control or joint control over
those policies. This is generally the case where the group
holds between 20% and 50% of the voting rights.
A joint venture is a type of joint arrangement whereby
the parties that have joint control of the arrangement
have rights to the net assets of the joint venture. Joint
control is the contractually agreed sharing of control of
an arrangement, which exists only when decisions about
the relevant activities require the unanimous consent of
the parties sharing control.
The considerations made in determining significant
influence or joint control are similar to those necessary
to determine control over subsidiaries. The Group’s
investment in its associates and joint ventures are
accounted for using the equity method.
Under the equity method, the investment in an associate
or a joint venture is initially recognised at cost. The
carrying amount of the investment is adjusted to
recognise changes in the Group’s share of net assets of
the associate or joint venture since the acquisition date.
Goodwill relating to the associate or joint venture is
included in the carrying amount of the investment and is
not tested for impairment separately.
After application of the equity method, the Group
determines whether it is necessary to recognise an
impairment loss on its investment in its associate or joint
venture. At each reporting date, the Group determines
whether there is objective evidence that the investment
in the associate or joint venture is impaired. If there is
such evidence, the Group calculates the amount of
impairment as the difference between the recoverable
amount of the associate or joint venture and it’s carrying
value, and then recognises the loss within “Income from
investments in associates related to Urban Partners
managed funds”, “Income from investments in
associates” or “Income from investments in joint
venture” in the statement of profit or loss. When the
group’s share of losses in an equity-accounted
investment equals or exceeds its interest in the entity,
including any other unsecured long-term receivables, the
group does not recognise further losses, unless it has
55
incurred obligations or made payments on behalf of the
other entity.
The group treats transactions with non-controlling
interests that do not result in a loss of control as
transactions with equity owners of the group. A change
in ownership interest results in an adjustment between
the carrying amounts of the controlling and non-
controlling interests to reflect their relative interests in
the subsidiary. Any difference between the amount of
the adjustment to non-controlling interests and any
consideration paid or received is recognised in a separate
reserve within equity attributable to owners of Urban
Partners A/S.
Upon loss of significant influence over the associate or
joint control over the joint venture, the Group measures
and recognises any retained investment at its fair value.
Any difference between the carrying amount of the
associate or joint venture upon loss of significant
influence or joint control and the fair value of the
retained investment and proceeds from disposal is
recognised in profit or loss.
Unrealised gains on transactions between the group and
its associates are eliminated to the extent of the group’s
interest in these entities. Unrealised losses are also
eliminated unless the transaction provides evidence of an
impairment of the asset transferred. Accounting policies
of equity accounted investees have been changed where
necessary to ensure consistency with the policies
adopted by the Company.
Minority interests
Minority interests form part of the Group’s total equity.
Upon distribution of net profit, net profit is broken down
on the share attributable to minority interests and the
share attributable to the shareholders of the Parent
Company. Minority interests are recognised on the basis
of a remeasurement of acquired assets and liabilities to
fair value at the time of acquisition of subsidiaries.
On subsequent changes to minority interests where the
Group retains control of the subsidiary, the consideration
is recognised directly in equity.
Translation policies
Items included in the financial statements of each of the
group’s entities are measured using the currency of the
primary economic environment in which the entity
operates (‘the functional currency’). The consolidated
financial statements are presented in DKK, which is Urban
Partners A/S functional and presentation currency.
Transactions and balances
Transactions in foreign currencies are initially recorded
by the Group’s entities at their respective functional
currency spot rates at the date the transaction first
qualifies for recognition.
Monetary assets and liabilities denominated in foreign
currencies are translated at the functional currency spot
rates of exchange at the reporting date.
Differences arising on settlement or translation of
monetary items are recognised in profit or loss. Tax
charges and credits attributable to exchange differences
on those monetary items are recognised in other
comprehensive income.
Non-monetary items that are measured in terms of
historical cost in a foreign currency are translated using
the exchange rates at the dates of the initial transactions.
Non-monetary items measured at fair value in a foreign
currency are translated using the exchange rates at the
date when the fair value is determined. The gain or loss
arising on translation of non-monetary items measured
at fair value is treated in line with the recognition of the
gain or loss on the change in fair value of the item (i.e.,
translation differences on items whose fair value gain or
loss is recognised in other comprehensive income or
profit or loss are also recognised in other comprehensive
income or profit or loss, respectively).
In determining the spot exchange rate to use on initial
recognition of the related asset, expense or income (or
part of it) on the derecognition of a non-monetary asset
or non-monetary liability relating to advance
consideration, the date of the transaction is the date on
which the Group initially recognises the non-monetary
asset or non-monetary liability arising from the advance
consideration. If there are multiple payments or receipts
in advance, the Group determines the transaction date
for each payment or receipt of advance consideration.
Group companies
On consolidation, the assets and liabilities of foreign
operations are translated into DKK at the rate of
exchange prevailing at the reporting date and their
statements of profit or loss are translated at exchange
rates prevailing at the dates of the transactions. The
exchange differences arising on translation for
consolidation are recognised in other comprehensive
56
income. On disposal of a foreign operation, the
component of other comprehensive income relating to
that particular foreign operation is reclassified to profit or
loss.
Any goodwill arising on the acquisition of a foreign
operation and any fair value adjustments to the carrying
amounts of assets and liabilities arising on the acquisition
are treated as assets and liabilities of the foreign
operation and translated at the spot rate of exchange at
the reporting date.
Current versus non-current classification
The Group presents assets and liabilities in the statement
of financial position based on current/non-current
classification.
An asset is current when it is expected to be realised or
intended to be sold or consumed in the normal operating
cycle, held primarily for the purpose of trading, expected
to be realised within twelve months after the reporting
period or cash or cash equivalent unless restricted from
being exchanged or used to settle a liability for at least
twelve months after the reporting period. All other assets
are classified as non-current.
A liability is current when it is expected to be settled in
the normal operating cycle, it is held primarily for the
purpose of trading, it is due to be settled within twelve
months after the reporting period, there is no
unconditional right to defer the settlement of the liability
for at least twelve months after the reporting period. The
Group classifies all other liabilities as non-current.
Deferred tax assets and liabilities are classified as non-
current assets and liabilities.
Fair value measurement
The Group measures non-financial assets such as
investment properties and investment in shares owned
directly or indirectly, at fair value at each balance sheet
date.
Fair value is the price that would be received to sell an
asset or paid to transfer a liability in an orderly
transaction between market participants at the
measurement date. The fair value measurement is based
on the presumption that the transaction to sell the asset
or transfer the liability takes place either:
• In the principal market for the asset or liability or
• In the absence of a principal market, in the most
advantageous market for the asset or liability
The principal or the most advantageous market must be
accessible by the Group.
The fair value of an asset or a liability is measured using
the assumptions that market participants would use
when pricing the asset or liability, assuming that market
participants act in their economic best interest.
A fair value measurement of a non-financial asset takes
into account a market participant's ability to generate
economic benefits by using the asset in its highest and
best use or by selling it to another market participant that
would use the asset in its highest and best use.
The Group uses valuation techniques that are
appropriate in the circumstances and for which sufficient
data are available to measure fair value, maximising the
use of relevant observable inputs and minimising the use
of unobservable inputs.
All assets and liabilities for which fair value is measured
or disclosed in the financial statements are categorised
within the fair value hierarchy, described as follows,
based on the lowest level input that is significant to the
fair value measurement as a whole:
Level 1 — Quoted (unadjusted) market prices in active
markets for identical assets or liabilities
Level 2 — Valuation techniques for which the lowest level
input that is significant to the fair value measurement is
directly or indirectly observable
Level 3 — Valuation techniques for which the lowest level
input that is significant to the fair value measurement is
unobservable
For assets and liabilities that are recognised in the
financial statements at fair value on a recurring basis, the
Group determines whether transfers have occurred
between levels in the hierarchy by re-assessing
categorisation (based on the lowest level input that is
significant to the fair value measurement as a whole) at
the end of each reporting period.
The Group determines the policies and procedures for
both recurring fair value measurement, such as
investment properties and unquoted financial assets, and
for non-recurring measurement, such as assets held for
sale in discontinued operations. At each reporting date,
the Group analyses the movements in the values of assets
and liabilities which are required to be remeasured or re-
assessed as per the Group’s accounting policies.
57
External valuers are involved for valuation of significant
assets, such as investment properties or investment in
equity on an unquoted financial market. Involvement of
external valuers is determined annually by the Group.
Revenue from contracts with customers
IFRS 15 Revenue from Contracts with Customers (“IFRS
15”), specifies how and when revenue should be
recognized and requires disclosures about the nature,
amount, timing and uncertainty of revenues and cash
flows arising from customer contracts.
Revenue is measured based on the consideration
specified in a contract with a customer and excludes
amounts collected on behalf of third parties. A
performance obligation is a promise in a contract to
transfer a distinct good or service (or a bundle of goods
and services) to the customer and is the unit of account
in IFRS 15. A contract’s transaction price is allocated to
each distinct performance obligation and recognized as
revenue, as, or when, the performance obligation is
satisfied. The company recognizes revenue when it
transfers control of a product or service to a customer.
The company recognizes revenue from the following
major sources:
Asset Management Fee
The company’s primary asset management revenue
streams, which include base management fees, incentive
fees (including incentive distributions and performance
fees), are satisfied over time.
The company earns management fees in accordance with
contractual arrangements with our funds. Fees are
typically equal to a percentage of fee-bearing capital
within the respective fund or entity and are accrued
quarterly. These fees are earned over the period of time
that the management services are provided and are
allocated to the distinct services provided by the
company during the reporting period.
Service corporate fee
Service corporate fee revenue stream relate to services
not included in the asset management fee agreement
that the Group performs on behalf of the funds it
manages. The revenues arising these services are
recognized on a time spend basis.
Other
Other revenues relate to the hospitality operations which
is generated by providing accommodation, food and
beverage and leisure facilities to hotel guests. Revenue
from accommodation is recognized over the period that
the guest stays at the hotel; food and beverage revenue
as well as revenue from leisure activities is recognized
when goods and services are provided. Further it includes
variable considerations that are considered highly
probable that a reversal will not take place in the future.
Income from interests in associates and other
investments related to Group Managed funds
Income from interest in associates and other investments
related to Urban Partners Managed funds comprise a fair
value movement of the other investments directly or
indirectly held by the Group.
The carried interest income is calculated taking into
account the required performance conditions and
distribution agreements with each Fund as a whole.
Administrative expenses
Administrative expenses comprise expenses for
premises, sales as well as office expenses, etc.
Staff expenses
Staff expenses comprise wages and salaries as well as
payroll-related expenses.
Pension
The Group makes contributions to defined contribution
pension plans. The contributions are recognized in the
consolidated statement of comprehensive income as
incurred.
Share base compensation
Warrants were issued to certain partners and employees
of the Group. The warrants are equity-settled shared-
based payment transactions as they may only be settled
by shares in Urban Partners A/S. The costs related to the
warrants are recognized over the vesting period of four
year. The participants must make certain payments for
receiving the warrants, which is assumed to equal the fair
value of the issued warrants. The costs related to the
warrant are offset by the payments received from the
participant, creating a nil impact on the consolidated
statement of comprehensive income.
58
The fair value of the employee services received in
exchange for the warrants is determined at the grant
date.
Depreciation, amortisation and impairment losses
Amortisation, depreciation and impairment losses
comprise amortisation, depreciation and impairment of
property, plant and equipment, intangible assets and
goodwill.
Financial income and expenses
Financial income and expenses comprise interest income
and expense determined on an amortised cost basis and
exchange rate adjustments.
Property, plant and equipment
Property, plant and equipment are measured at cost less
accumulated depreciation and less any accumulated
impairment losses.
Cost comprises the cost of acquisition and expenses
directly related to the acquisition up until the time when
the asset is ready for use. Interest expenses on loans
raised directly for financing the construction of property,
plant and equipment are recognised in cost over the
period of construction. All indirectly attributable
borrowing expenses are recognised in the income
statement.
Depreciation based on cost reduced by any residual value
is calculated on a straight-line basis over the expected
useful lives of the assets, which are:
Land and buildings
50 years
Other fixtures and fittings,
tools, and equipment
3-5 years
Leasehold improvements
20 years
Depreciation period and residual value are reassessed
annually.
Intangible assets
Finite life intangible assets are carried at cost less any
accumulated amortization and any accumulated
impairment losses and are amortized on a straight-line
basis over their estimated useful lives, which range
between 2 to 12 years. Amortization is recorded within
depreciation and amortization in the Statements of
comprehensive income.
Research costs are expensed as incurred. Development
expenditures on an individual project are recognised as
an intangible asset when the Group can demonstrate:
• The technical feasibility of completing the
intangible asset so that the asset will be available
for use or sale
• Its intention to complete and its ability and
intention to use or sell the asset
• How the asset will generate future economic
benefits
• The availability of resources to complete the asset
• The ability to measure reliably the expenditure
during development
Following initial recognition of the development
expenditure as an asset, the asset is carried at cost less
any accumulated amortisation and accumulated
impairment losses. Amortisation of the asset begins
when development is complete, and the asset is available
for use. It is amortised over the period of expected future
benefit. Amortisation is recorded in cost of sales.
Intangible assets under development and Goodwill are
tested for impairment annually.
Impairment non-financial assets
The Company assesses at each reporting date, whether
there is an indication that an asset may be impaired. If
any indication exists, or when annual impairment testing
for an asset is required, the Company estimates the
asset’s recoverable amount. An asset’s recoverable
amount is the higher of an asset’s fair value less costs of
disposal and its value in use. The recoverable amount is
determined for an individual asset, unless the asset does
not generate cash inflows that are largely independent of
those from other assets or group of assets. When the
carrying amount of an asset exceeds its recoverable
amount, the asset is considered impaired and is written
down to its recoverable amount.
In assessing value in use, the estimated future cash flows
are discounted to their present value using discount rate
that reflects current market assessments of the time
value of money and the risks specific to the asset. In
determining fair value less costs of disposal, recent
market transactions are taken into account. If no such
transactions can be identified, an appropriate valuation
model is used. These calculations are corroborated by
valuation multiples, quoted share prices for publicly
traded companies or other available fair value indicators.
59
Impairment losses are recognised in the statement of
profit or loss in expense categories consistent with the
function of the impaired asset.
For assets excluding goodwill, an assessment is made at
each reporting date to determine whether there is an
indication that previously recognised impairment losses
no longer exist or have decreased. If such indication
exists, the Group estimates the asset’s recoverable
amount. A previously recognised impairment loss is
reversed only if there has been a change in the
assumptions used to determine the asset’s recoverable
amount since the last impairment loss was recognised.
The reversal is limited so that the carrying amount of the
asset does not exceed its recoverable amount, nor
exceed the carrying amount that would have been
determined, net of depreciation, had no impairment loss
been recognised for the asset in prior years. Such reversal
is recognised in the statement of profit or loss unless the
asset is carried at a revalued amount, in which case, the
reversal is treated as a revaluation increase.
Leases
The Group assesses at contract inception whether a
contract is, or contains, a lease. That is, if the contract
conveys the right to control the use of an identified asset
for a period of time in exchange for consideration.
The Group applies a single recognition and measurement
approach for all leases, except for short-term leases and
leases of low-value assets. The Group recognises lease
liabilities to make lease payments and right-of-use assets
representing the right to use the underlying assets.
Right-of-use assets
The Group recognises right-of-use assets at the
commencement date of the lease (i.e., the date the
underlying asset is available for use). Right-of-use assets
are measured at cost, less any accumulated depreciation
and impairment losses, and adjusted for any
remeasurement of lease liabilities. The cost of right-of-
use assets includes the amount of lease liabilities
recognised, initial direct costs incurred, and lease
payments made at or before the commencement date
less any lease incentives received. Right-of-use assets are
depreciated on a straight-line basis over the shorter of
the lease term and the estimated useful lives of the
assets. Refer to note 8.
The right-of-use assets are also subject to impairment.
Refer to the accounting policies in section Impairment of
non-financial assets.
Lease liabilities
At the commencement date of the lease, the Group
recognises lease liabilities measured at the present value
of lease payments to be made over the lease term. The
lease payments include fixed payments (including in-
substance fixed payments) less any lease incentives
receivable, variable lease payments that depend on an
index or a rate, and amounts expected to be paid under
residual value guarantees. The lease payments also
include the exercise price of a purchase option
reasonably certain to be exercised by the Company and
payments of penalties for terminating the lease, if the
lease term reflects the Company exercising the option to
terminate.
Variable lease payments that do not depend on an index
or a rate are recognised as expenses (unless they are
incurred to produce inventories) in the period in which
the event or condition that triggers the payment occurs.
In calculating the present value of lease payments, the
Company uses its incremental borrowing rate at the lease
commencement date because the interest rate implicit in
the lease is not readily determinable. After the
commencement date, the amount of lease liabilities is
increased to reflect the accretion of interest and reduced
for the lease payments made. In addition, the carrying
amount of lease liabilities is remeasured if there is a
modification, a change in the lease term, a change in the
lease payments (e.g., changes to future payments
resulting from a change in an index or rate used to
determine such lease payments) or a change in the
assessment of an option to purchase the underlying
asset.
Income taxes
Current tax receivables and liabilities
Current income tax assets and liabilities are measured at
the amount expected to be recovered from or paid to the
taxation authorities. The tax rates and tax laws used to
compute the amount are those that are enacted or
substantively enacted at the reporting date in the
countries where the Group operates and generates
taxable income.
Current income tax relating to items recognised directly
in equity is recognised in equity and not in the statement
of profit or loss.
Management periodically evaluates positions taken in
the tax returns with respect to situations in which
60
applicable tax regulations are subject to interpretation
and establishes provisions where appropriate.
Deferred tax assets and liabilities
Deferred tax is provided using the liability method on
temporary differences between the tax bases of assets
and liabilities and their carrying amounts for financial
reporting purposes at the reporting date.
Deferred tax liabilities are recognised for all taxable
temporary differences, except:
• In respect of taxable temporary differences
associated with investments in subsidiaries,
associates and interests in joint ventures, when
the timing of the reversal of the temporary
differences can be controlled and it is probable
that the temporary differences will not reverse in
the foreseeable future
Deferred tax assets are recognised for all deductible
temporary differences, the carry forward of unused tax
credits and any unused tax losses. Deferred tax assets are
recognised to the extent that it is probable that taxable
profit will be available against which the deductible
temporary differences, and the carry forward of unused
tax credits and unused tax losses can be utilised, except:
• When the deferred tax asset relating to the
deductible temporary difference arises from the
initial recognition of an asset or liability in a
transaction that is not a business combination
and, at the time of the transaction, affects neither
the accounting profit nor taxable profit or loss
• In respect of deductible temporary differences
associated with investments in subsidiaries,
associates and interests in joint ventures,
deferred tax assets are recognised only to the
extent that it is probable that the temporary
differences will reverse in the foreseeable future
and taxable profit will be available against which
the temporary differences can be utilised
The carrying amount of deferred tax assets is reviewed at
each reporting date and reduced to the extent that it is
no longer probable that sufficient taxable profit will be
available to allow all or part of the deferred tax asset to
be utilised. Unrecognised deferred tax assets are re-
assessed at each reporting date and are recognised to the
extent that it has become probable that future taxable
profits will allow the deferred tax asset to be recovered.
Deferred tax assets and liabilities are measured at the tax
rates that are expected to apply in the year when the
asset is realised or the liability is settled, based on tax
rates (and tax laws) that have been enacted or
substantively enacted at the reporting date.
Deferred tax relating to items recognised outside profit
or loss is recognised outside profit or loss. Deferred tax
items are recognised in correlation to the underlying
transaction either in other comprehensive income or
directly in equity.
The Group offsets deferred tax assets and deferred tax
liabilities if and only if it has a legally enforceable right to
set off current tax assets and current tax liabilities and the
deferred tax assets and deferred tax liabilities relate to
income taxes levied by the same taxation authority on
either the same taxable entity or different taxable entities
which intend either to settle current tax liabilities and
assets on a net basis, or to realise the assets and settle
the liabilities simultaneously, in each future period in
which significant amounts of deferred tax liabilities or
assets are expected to be settled or recovered.
Financial assets
Initial recognition and measurement
Financial assets are classified, at initial recognition, as
subsequently measured at amortised cost and fair value
through profit or loss (FVTPL).
The classification of financial assets at initial recognition
depends on the financial asset’s contractual cash flow
characteristics and the Group’s business model for
managing them. With the exception of trade receivables
that do not contain a significant financing component or
for which the Company has applied the practical
expedient, the Company initially measures a financial
asset at its fair value plus, in the case of a financial asset
not at fair value through profit or loss, transaction costs.
The Group only has financial assets subsequently
measured at amortised cost or at FVTPL. The financial
assets at FVTPL are included in the other non-current
investment in note 14.
Subsequent measurement
Financial assets at amortised cost are subsequently
measured using the effective interest (EIR) method and
are subject to impairment. Gains and losses are
recognised in profit or loss when the asset is
derecognised, modified, or impaired. The Company’s
financial assets are the following:
61
Financial assets at amortised cost are mainly trade
receivables, the other current financial assets consist of
prepaid expenses concerning rent, insurance premiums,
subscriptions and interest as well as the long-term loans
to affiliated companies included in other non-current
financial assets.
Financial assets at fair value through profit or loss are
carried in the statement of financial position at fair value
with net changes in fair value recognised in the statement
of profit or loss. This category includes investments in
equity instruments that do not meet the criteria of a
subsidiary or an associate. These investments, included in
other non-current financial assets (note 14) are
presented at fair value, including the fair value of the
carried interests. The profit or loss arising from the fair
valuation as well as the carried interest calculation are
presented in financial income and “income from carried
interests” respectively.
Derecognition
A financial asset (or, where applicable, a part of a financial
asset or part of a group of similar financial assets) is
primarily derecognised (i.e., removed from the
Company’s statement of financial position) when:
• The rights to receive cash flows from the asset
have expired or
• The Company has transferred its rights to receive
cash flows from the asset or has assumed an
obligation to pay the received cash flows in full
without material delay to a third party under a
‘pass-through’ arrangement; and either (a) the
Group has transferred substantially all the risks
and rewards of the asset, or (b) the Group has
neither transferred nor retained substantially all
the risks and rewards of the asset, but has
transferred control of the asset
When the Group has transferred its rights to receive cash
flows from an asset or has entered into a pass-through
arrangement, it evaluates if, and to what extent, it has
retained the risks and rewards of ownership. When it has
neither transferred nor retained substantially all of the
risks and rewards of the asset, nor transferred control of
the asset, the Group continues to recognise the
transferred asset to the extent of its continuing
involvement. In that case, the Group also recognises an
associated liability. The transferred asset and the
associated liability are measured on a basis that reflects
the rights and obligations that the Group has retained.
Continuing involvement that takes the form of a
guarantee over the transferred asset is measured at the
lower of the original carrying amount of the asset and the
maximum amount of consideration that the Group could
be required to repay.
Impairment
The Group calculates an allowance for expected credit
losses (ECLs) for all debt instruments not held at fair value
through profit or loss. ECLs are based on the difference
between the contractual cash flows due in accordance
with the contract and all the cash flows that the Group
expects to receive, discounted at an approximation of the
original effective interest rate. The expected cash flows
will include cash flows from the sale of collateral held or
other credit enhancements that are integral to the
contractual terms.
The expected credit loss is based on a provision matrix,
which considers the Group’s historic credit losses
combined with forward looking information that is
expected to affect the loss rates. The Group has no
history of significant credit losses on receivables. Due to
the substance in and the agreements for receivables
combined with the historic low credit loss rate, the
expected credit loss on rent and services charge
receivables is immaterial.
Financial liabilities
Initial recognition and measurement
Financial liabilities are classified, at initial recognition, as
financial liabilities at fair value through profit or loss,
loans and borrowings, payables, or as derivatives
designated as hedging instruments in an effective hedge,
as appropriate.
All financial liabilities are recognised initially at fair value
and, in the case of loans and borrowings and payables,
net of directly attributable transaction costs. The
Company’s financial liabilities include trade and other
payables, loans and borrowings with credit institutions.
Subsequent measurement
For purposes of subsequent measurement, financial
liabilities are classified in two categories:
• Financial liabilities at fair value through profit or loss
• Financial liabilities at amortised cost (loans and
borrowings)
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The Company does not have financial liabilities at fair
value through profit and loss.
For the financial liabilities at amortised cost, after initial
recognition, interest-bearing loans and borrowings are
subsequently measured at amortised cost using the
effective interest rate method. Gains and losses are
recognised in profit or loss when the liabilities are
derecognised as well as through the effective interest
rate amortisation process.
Amortised cost is calculated by taking into account any
discount or premium on acquisition and fees or costs that
are an integral part of the effective interest rate. The
effective interest rate amortisation is included as finance
costs in the statement of profit or loss. This category
generally applies to interest-bearing loans and
borrowings. For more information, refer to note 21.
Derecognition
A financial liability is derecognised when the obligation
under the liability is discharged or cancelled or expires.
When an existing financial liability is replaced by another
from the same lender on substantially different terms, or
the terms of an existing liability are substantially
modified, such an exchange or modification is treated as
the derecognition of the original liability and the
recognition of a new liability. The difference in the
respective carrying amounts is recognised in the
statement of profit or loss.
Offsetting of financial instruments
Financial assets and financial liabilities are offset, and the
net amount is reported in the consolidated statement of
financial position if there is a currently enforceable legal
right to offset the recognised amounts and there is an
intention to settle on a net basis, to realise the assets and
settle the liabilities simultaneously.
Cash and cash equivalents
Cash and cash equivalents in the statement of financial
position comprise cash at banks subject to an
insignificant risk of changes in value.
Business combinations
Business combinations are accounted for using the
acquisition method. The cost of an acquisition is
measured as the aggregate of the consideration
transferred measured at acquisition date fair value and
the amount of any non-interests in the acquiree. For each
business combination, the Group elects whether to
measure the non-controlling interests in the acquiree at
fair value or at the proportionate share of the acquiree’s
identifiable net assets. Acquisition-related costs are
expensed as incurred and included in administrative
expenses. When the Group acquires a business, it
assesses the financial assets and liabilities assumed for
appropriate classification and designation in accordance
with the contractual terms, economic circumstances and
pertinent conditions as at the acquisition date. This
includes the separation of embedded derivatives in host
contracts by the acquiree. If the business combination is
achieved in stages, any previously held equity interest is
re- measured at its acquisition date fair value and any
resulting gain or loss is recognised in profit or loss. It is
then considered in the determination of goodwill on
acquisition, qualifying as business combinations, is
initially measured at cost being the difference between
the cost of the business acquisition and the fair value of
its identifiable assets, liabilities and contingent liabilities.
New and amended standards and interpretations
The Group applied for the first-time certain standards
and amendments, which are effective for annual periods
beginning on or after 1 January 2023. The amendments
to IAS 1 and IFRS Practice Statement 2 Making Materiality
Judgements provide guidance and examples to help
entities apply materiality judgements to accounting
policy disclosure. The amendments have had an impact
on Urban Partners Group’s disclosure of accounting
policies, but no material impact on the measurement,
recognition or presentation of any items in the Annual
Report in 2023.
Standards issued but not yet effective
IASB has issued certain new or amended accounting
standards and interpretations that have not yet become
effective or adopted by the EU. None of these have been
early adopted by the group. Urban Partners expects to
adopt the accounting standards and interpretations as
they become mandatory. The new or amended standards
or interpretations are not expected to have a significant
impact on our consolidated financial statements.
63
31. Critical accounting estimates and judgements
The Group makes accounting estimates and judgements
concerning the future. The resulting accounting
estimates will, by definition, seldom equal the related
actual results. The estimates and assumptions that have
a significant risk of causing a material adjustment to the
carrying amounts of assets and liabilities within the next
financial year are addressed below.
The judgments, estimates and assumptions applied are
based on historical experience and other factors that
Management considers to be reliable, but which by their
very nature are associated with uncertainty and
unpredictability. These assumptions may prove
incomplete or incorrect, and unexpected events or
circumstances may arise. The most critical estimates,
judgements and assumptions for the individual items are
described below.
The Group is also subject to risks and uncertainties that
may lead to actual results differing from these estimates,
both positively and negatively.
Judgements
In the process of applying the Group’s accounting
policies, management has made the following
judgements when applying accounting policies:
Shares are classified as equity investments if the Group
does not have an obligation to sell the shares at cost or
an amount lower than fair value if the Investors elect
another Fund Manager. If the Group has such an
obligation, such shares are considered contingent
consideration arrangement related to the services
delivered under the Investment Management
agreements.
Estimates and assumptions
The key assumptions concerning the future and other key
sources of estimation uncertainty at the reporting date,
that have a significant risk of causing a material
adjustment to the carrying amounts of assets and
liabilities within the next financial year, are described
below. The Group based its assumptions and estimates
on parameters available when the consolidated financial
statements were prepared. Existing circumstances and
assumptions about future developments, however, may
change due to market changes or circumstances arising
that are beyond the control of the Group. Such changes
are reflected in the assumptions when they occur.
Fair value
Interests in other financial assets managed by Urban
Partners owned directly by the Group or indirectly
through an associate.
Investments in associates and other investments includes
shares owned directly or indirectly which are measured
at fair value.
Valuation of some of the shares are subject to significant
accounting estimates as the valuation is based on the
performance of the Urban Partners Managed Fund
exceeding a predetermined hurdle rate, which is in turn
driven by the risk factors of the fund including financial
capacity of tenants to pay rent, market conditions in
terms of supply and demand of buildings / rental space,
Urban Partners ability to buy / sell buildings at low / high
valuation respectively at the right cycles of the fund
investment cycle, independent valuations or better are
obtained on sale, vacancy rates, renegotiation terms of
rental and financing arrangements, FX rates stability as FX
risk is not hedged in the fund, compliance with loan
covenants, taxation rules stability and the discount rate
applicable to forecasted carried interest flows.
Goodwill
At initial recognition goodwill is recognised in the balance
sheet at cost, as described in note 11
‘Business-combinations’. Subsequently, goodwill is
measured at cost less accumulated impairment losses.
Goodwill is not amortised. An impairment test is
performed at least once a year together with other non-
current assets of the Group. The book value of goodwill is
allocated to the Group’s cash generating units at the time
of acquisition
Properties in investments in associates and other non-
current investments
Properties held by entities in which the Group hold an
equity interest through investments in associates or non-
controlling interests are normally measured at fair value.
The fair value of investment properties is determined by
Urban Partners and assessed by independent valuators
using acknowledged valuation techniques. The models
used for valuing investment properties can include the
net present value of estimated future cash flows, the
64
capitalisation of expected yields approach, and/or recent
transactions of comparable properties. The
determination of the inputs in the valuation calculations
requires management to make judgments and estimates.
Impairment of non-financial assets
Impairment exists when the carrying value of an asset or
cash generating unit exceeds its recoverable amount,
which is the higher of its fair value less costs of disposal
and its value in use. The fair value less costs of disposal
calculation is based on available data from binding sales
transactions, conducted at arm’s length, for similar assets
or observable market prices less incremental costs of
disposing of the asset. The value in use calculation is
based on a DCF model. The cash flows are derived from
the budget for the next five years and do not include
restructuring activities that the Group is not yet
committed to or significant future investments that will
enhance the performance of the assets of the CGU being
tested. The recoverable amount is sensitive to the
discount rate used for the DCF model as well as the
expected future cash-inflows and the growth rate used
for extrapolation purposes. These estimates are most
relevant to intangibles with indefinite useful lives
recognised by the Group.
Management has reviewed the development projects
and assessed the possibilities for realising a profitable
business basis. These assessments have been used to
assess the need of impairment of activated project costs.
The assessment did not lead to impairments.
Leases - Estimating the incremental borrowing rate
When the Group cannot readily determine the interest
rate implicit in the lease, therefore, it uses its incremental
borrowing rate (IBR) to measure lease liabilities. The IBR
is the rate of interest that the Group would have to pay
to borrow over a similar term, and with a similar security,
the funds necessary to obtain an asset of a similar value
to the right-of-use asset in a similar economic
environment. The IBR therefore reflects what the Group
‘would have to pay’, which requires estimation when no
observable rates are available (such as for subsidiaries
that do not enter into financing transactions) or when
they need to be adjusted to reflect the terms and
conditions of the lease (for example, when leases are not
in the subsidiary’s functional currency). The Group
estimates the IBR using observable inputs (such as
market interest rates) when available and is required to
make certain entity-specific estimates (such as the
subsidiary’s stand-alone credit rating).
32. Accounting policies for the Parent Company
The accounting policies of the Parent Company are the
same as for the Group except as described below:
The financial statements of the Parent company have
been prepared in accordance with the Danish Financial
Statements Act applying to large enterprises of reporting
class C.
The Parent Company Financial Statements for 2023 are
presented in tDKK.
The income statement is presented according to the
nature of expenses. To obtain a true and fair view of the
investment management activities of company, fair value
changes and dividend from entities holding investments
in the funds managed by Urban Partners is presented as
a separate line item within profit before financial items.
Further, income from associates holding such
investments is presented as a separate item within profit
before financial items.
The balance sheet is presented in a current/non-current
order.
The accounting policies used in the preparation of the
financial statements are consistent with those of last
year.
Revenue
The Parent Company has chosen to use IFRS15 as
interpretation for revenue recognition. Income from the
rendering of services is recognised as revenue as the
services are rendered. Accordingly, revenue corresponds
to the market value of the services rendered during the
year.
Revenue is measured at the fair value of the agreed
consideration excluding VAT and taxes charged on behalf
of third parties. All discounts and rebates granted are
recognised in revenue.
Investments in subsidiaries and associates
Investments in subsidiaries and associates are accounted
for under the equity method. The subsidiaries are
accounted under the consolidation approach.
65
Undistributed reserves in subsidiaries are recognised in a
separate reserve within equity.
Subsidiaries and associates with a negative net asset
value are recognised at DKK 0 and it is assessed whether
receivables should be considered uncollectible. Any legal
or constructive obligation of the Parent Company to
cover the negative balance of the enterprise is recognised
in provisions.
Other non-current investments
Investment in other non-current assets is measured at
cost.
Receivables
Receivables are measured at amortised cost.
The Parent Company has chosen IAS 39 as interpretation
for impairment of financial receivables.
An impairment loss is recognised if there is objective
evidence that a receivable or a group of receivables is
impaired. If there is objective evidence that an individual
receivable has been impaired, an impairment loss is
recognised on an individual basis.
Receivables in respect of which there is no objective
evidence of individual impairment are tested for
objective evidence of impairment on a portfolio basis.
The portfolios are primarily based on the debtors'
domicile and credit ratings in line with the Company's risk
management policy. The objective evidence applied to
portfolios is determined based on historical loss
experience.
Impairment losses are calculated as the difference
between the carrying amount of the receivables and the
present value of the expected cash flows, including the
realisable value of any collateral received. The effective
interest rate for the individual receivable or portfolio is
used as discount rate.
Leases
The Parent Company has chosen IAS 17 as interpretation
for classification and recognition of leases.
Leases that do not transfer substantially all the risks and
rewards incident to the ownership to the Parent
Company are classified as operating leases. Payments
relating to operating leases and any other rent
agreements are recognised in the income statement over
the term of the lease. The Parent Company's aggregate
liabilities relating to operating leases and other rent
agreements are disclosed under "Contingent liabilities".
Liabilities
Financial liabilities are recognised at the date of
borrowing at the net proceeds received less transaction
costs paid. On subsequent recognition, financial liabilities
are measured at amortised cost, corresponding to the
capitalised value, using the effective interest rate.
Accordingly, the difference between the proceeds and
the nominal value is recognised in the income statement
over the term of the loan. Financial liabilities also include
the capitalised residual lease liability in respect of finance
leases.
Other liabilities are measured at net realisable value.
Cash Flow Statement
With reference to section 86 paragraph 4 of the Danish
Financial Statements Act, no Cash Flow Statement for the
Parent Company are prepared.
Annual reportAuditor's report on audited financial statementsParsePort XBRL Converter2023-01-012023-12-312022-01-012022-12-312024-06-11Mikkel Bülow-Lehnsby529900UZ3DIIHDNERE43Reporting class C, large enterprise291687092005-11-02www.urbanpartners.com2024-06-11529900VSWLQF0O3GA94633771231Strandvejen 442900 HellerupOpinionBasis for Opinion2024-06-11mne3014133771231mne4415920281916202028529900UZ3DIIHDNERE432023-01-012023-12-31cmn:ConsolidatedMember529900UZ3DIIHDNERE432023-01-012023-12-31cmn:ConsolidatedMember1529900UZ3DIIHDNERE432023-01-012023-12-31cmn:ConsolidatedMember2529900UZ3DIIHDNERE432023-01-012023-12-31529900UZ3DIIHDNERE432022-01-012022-12-31529900UZ3DIIHDNERE432023-12-31529900UZ3DIIHDNERE432022-12-31529900UZ3DIIHDNERE432022-12-31ifrs-full:IssuedCapitalMember529900UZ3DIIHDNERE432023-01-012023-12-31ifrs-full:IssuedCapitalMember529900UZ3DIIHDNERE432023-12-31ifrs-full:IssuedCapitalMember529900UZ3DIIHDNERE432022-12-31ifrs-full:ReserveOfExchangeDifferencesOnTranslationMember529900UZ3DIIHDNERE432023-01-012023-12-31ifrs-full:ReserveOfExchangeDifferencesOnTranslationMember529900UZ3DIIHDNERE432023-12-31ifrs-full:ReserveOfExchangeDifferencesOnTranslationMember529900UZ3DIIHDNERE432022-12-31ifrs-full:RetainedEarningsMember529900UZ3DIIHDNERE432023-01-012023-12-31ifrs-full:RetainedEarningsMember529900UZ3DIIHDNERE432023-12-31ifrs-full:RetainedEarningsMember529900UZ3DIIHDNERE432022-12-31ifrs-full:EquityAttributableToOwnersOfParentMember529900UZ3DIIHDNERE432023-01-012023-12-31ifrs-full:EquityAttributableToOwnersOfParentMember529900UZ3DIIHDNERE432023-12-31ifrs-full:EquityAttributableToOwnersOfParentMember529900UZ3DIIHDNERE432022-12-31ifrs-full:NoncontrollingInterestsMember529900UZ3DIIHDNERE432023-01-012023-12-31ifrs-full:NoncontrollingInterestsMember529900UZ3DIIHDNERE432023-12-31ifrs-full:NoncontrollingInterestsMember529900UZ3DIIHDNERE432021-12-31ifrs-full:IssuedCapitalMember529900UZ3DIIHDNERE432022-01-012022-12-31ifrs-full:IssuedCapitalMember529900UZ3DIIHDNERE432021-12-31ifrs-full:ReserveOfExchangeDifferencesOnTranslationMember529900UZ3DIIHDNERE432022-01-012022-12-31ifrs-full:ReserveOfExchangeDifferencesOnTranslationMember529900UZ3DIIHDNERE432021-12-31ifrs-full:RetainedEarningsMember529900UZ3DIIHDNERE432022-01-012022-12-31ifrs-full:RetainedEarningsMember529900UZ3DIIHDNERE432021-12-31ifrs-full:EquityAttributableToOwnersOfParentMember529900UZ3DIIHDNERE432022-01-012022-12-31ifrs-full:EquityAttributableToOwnersOfParentMember529900UZ3DIIHDNERE432021-12-31ifrs-full:NoncontrollingInterestsMember529900UZ3DIIHDNERE432022-01-012022-12-31ifrs-full:NoncontrollingInterestsMember529900UZ3DIIHDNERE432021-12-31529900UZ3DIIHDNERE432022-01-012022-12-31cmn:ConsolidatedMember529900UZ3DIIHDNERE432023-01-012023-12-31cmn:ConsolidatedMember1529900UZ3DIIHDNERE432023-01-012023-12-31cmn:ConsolidatedMember2529900UZ3DIIHDNERE432023-01-012023-12-31cmn:ConsolidatedMember1529900UZ3DIIHDNERE432023-01-012023-12-31cmn:ConsolidatedMember2529900UZ3DIIHDNERE432023-01-012023-12-31cmn:ConsolidatedMember3529900UZ3DIIHDNERE432023-01-012023-12-31cmn:ConsolidatedMember4529900UZ3DIIHDNERE432023-01-012023-12-31cmn:ConsolidatedMember5iso4217:DKKxbrli:pure