- Consistent implementation of portfolio strategy with focus on Core+/Core regions
- A total of around 5,600 apartments in Berlin and 3,800 apartments in Kiel
- Purchase price for the around 15,200 residential units of around EUR 1.2 billion
- Financing of transaction through around 50% bank loans and 50% free liquidity respectively
- Annual FFO contribution of around EUR 40 million expected
Michael Zahn, CEO of Deutsche Wohnen AG: “After months of intensive preparations, we are expanding our portfolio in our Core+ region Berlin with this transaction. At the same time, we are exceeding critical mass in Kiel and are strengthening other locations. With this acquisition, we are demonstrating once again that we are able to realise existing potentials efficiently and thus generate value for our shareholders.”
The large share of apartments in Berlin allows a quick and cost effective integration. With an average rent below the rent index, the properties in Berlin currently offer growth potential of up to 30 percent.
The transaction also strengthens Deutsche Wohnen’s position in the core region of Kiel. The previous portfolio in the appealing port and university town is being greatly expanded and enables with roughly 5,000 units for a highly efficient property management. The acquired residential units in Kiel currently offer a rent potential of up to 20 percent.
The other units of the acquired portfolio will complement Deutsche Wohnen’s residential portfolio, in particular in the Rhine-Main and Rhineland regions and Dresden.
Furthermore, the portfolios include around 3,300 apartments that Deutsche Wohnen identified for a planned sale. They include properties in the Core+ locations Hamburg and Munich. With this disposal portfolio, the full expertise of Deutsche Wohnen with regard to privatisations or block sales can be used.
The purchase price including remaining liabilities amounts to around EUR 1.2 billion. It is being financed through around 50% from the banking market and 50% existing liquid funds respectively.
Through the addition to the current portfolio, Deutsche Wohnen is able to manage the acquired housing stock at optimum cost due to scale effects. With the planned financing structure, the acquisitions are expected to contribute an increase of the annual FFO of Deutsche Wohnen of around EUR 40 million after the full integration.
Subject to customary sales conditions, such as antitrust clearance, the acquisition will be concluded in the coming months.
About Deutsche Wohnen
Deutsche Wohnen is one of the largest publicly listed real estate companies in Germany and Europe with a business focus on managing and developing its portfolio, which focusses on residential properties. As at 30 September 2015 the portfolio comprised 149,100 units, of which 147,000 were residential and 2,100 commercial properties. Deutsche Wohnen is listed in the Deutsche Börse’s MDAX and is included in the leading indices EPRA/NAREIT and GPR 100.