As a long-term investor in and manager of residential properties, Deutsche Wohnen has set itself the goal of both conserving and creating urgently needed housing. Our core business is the management of flats for rental. At the same time, we are active in nursing and assisted living, the acquisition and disposal of properties and in cutting-edge, digital areas of residential property management.
Acquisition of Blocks C-North, C-South, D-North and D-South
The properties in Karl-Marx-Allee were acquired by means of a so-called asset deal. The acquisition was not made through the purchase of shares, a so-called share deal. Deutsche Wohnen will take over the management of the holdings it has acquired in Karl-Marx-Allee.
The buildings in Karl-Marx-Allee are as important to Berlin as our UNESCO world heritage sites: the Horseshoe Estate in Britz, the Ring Estate Siemensstadt in Charlottenburg, the Carl Legien Residential Estate in Prenzlauer Berg and the White City Estate in Reinickendorf. We are delighted that we have been able to add this architecturally outstanding, urban ensemble to our holdings in Berlin. The historic buildings in Karl-Marx-Allee are a very good fit in our portfolio because we have extensive experience of both the management and the architectural and technical maintenance of listed properties. The Deutsche Wohnen Group owns 30,000 residential units with listed status, making us the owner of the largest portfolio of listed residential properties anywhere in Germany.
Part of the acquired holdings had already been divided into individual, freehold flats and commercial units in 2016 and 2017. Deutsche Wohnen‘s first dealings with these holdings were in June 2018. One of the four residential properties has not been partitioned in accordance with the Residential Property Act [Wohnungseigentumsgesetz – WEG] and is located in a neighbourhood conservation area.
The sale of the listed properties took place in the form of a bidding procedure on the basis of a purchase contract that was determined by the vendor and that from the very outset did not envisage an encumbrance authorisation either for the freehold flats or for the property that had not been partitioned. Only binding offers that were not dependent on obtaining financing approval were allowed. Upon acquiring the properties, the Deutsche Wohnen Group too was not given an encumbrance authorisation. Accordingly, the purchase price is being paid out of the company‘s own capital resources.
Communication with the tenants
It goes without saying that all existing tenancy agreements will remain valid. Moreover, all statutory provisions and contractual agreements regarding the protection of tenants will be observed by our company. In these properties in Karl-Marx-Allee, a tenants‘ advisory committee represents the interests of the tenants. In order to build a relationship of trust between landlord and tenant, we will in the very near future reach out to the tenants‘ advisory committee and offer to enter into dialogue.
There are no major investments envisaged in these properties at the moment because the buildings were refurbished in recent years. Of course, necessary maintenance work in the interests of conserving the properties will be undertaken whenever this is required. It is our aim to maintain this listed ensemble in its present condition and, of course, to manage it in such a way that we recognise its considerable architectural and urban design value.