Corporate | 12 February 2014 23:39
DGAP-News: IMMOFINANZ AG / Key word(s): Real Estate
12.02.2014 / 23:39
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BUWOG, a wholly owned subsidiary of IMMOFINANZ Group, is going to acquire a
residential property portfolio with approx. 18,000 units and 1.09 million
sqm of lettable space in Northern Germany. The agreed purchase price for
the portfolio amounts to roughly EUR 892 million (EUR 819,-/sqm). The gross
yield equals 7.6% based on a vacancy rate of only 2.3%. The transaction
will be executed through several share deals and is subject to customary
closing conditions (e.g. approval of the antitrust authorities). The
closing is expected to take place in the second quarter of 2014. The seller
is Solaia RE, a joint venture between Prelios and an investment fund
managed by Deutsche Asset & Wealth Management - Real Estate. BUWOG will
also take over the residential asset and property management business of
Prelios Deutschland with roughly 300 employees.
This transaction will increase the BUWOG portfolio to approx. 54,000 units
with 3.72 million sqm of usable space and a gross asset value of EUR 3.49
billion (EUR 939,-/sqm). The gross rental yield of this enlarged portfolio
will equal 5.5% based on a vacancy rate of 4.5%. Over 80% of the
portfolio's value is bundled in national and provincial capitals, other
larger and medium-sized cities and the immediate surrounding areas.
With this acquisition, BUWOG will reach its strategic goal to line up a
portfolio of standing investments equally between the core markets of
Austria (51% of the residential units) and Germany (49%).
The Executive Board and Supervisory Board of IMMOFINANZ AG have therefore
approved a proposal that will be made to shareholders at an extraordinary
general meeting, which calls for the spin-off of the wholly owned
subsidiary BUWOG and the subsequent listing of BUWOG on the stock exchange.
In connection with the spin-off, IMMOFINANZ shareholders will receive one
BUWOG share for every 20 IMMOFINANZ shares, such that 51% of BUWOG will be
owned by free float investors. This proposal to shareholders includes the
admission of the BUWOG share for trading on the stock exchanges in
Frankfurt (main listing), Vienna and Warsaw (in each case, the regulated
market). After the spin-off IMMOFINANZ will hold a financial investment of
49% in BUWOG AG, which is expected to be reduced over the medium-term.
IMMOFINANZ AG will relinquish management control over the BUWOG Group with
this transaction and, in this context, will conclude a de-domination
agreement with BUWOG AG. This agreement requires IMMOFINANZ AG to observe
certain restrictions in exercising its voting rights from the BUWOG shares.
The implementation of these plans is based on the assumption that the
extraordinary general meeting of IMMOFINANZ AG, which is scheduled for 14
March 2014, will approve the spin-off by a three-fourths majority.
'This transaction paves the way for the spin-off of BUWOG and the resulting
separation of the residential properties in Germany and Austria from the
commercial portfolio of IMMOFINANZ Group. Today, IMMOFINANZ still bundles
these two different asset classes that cater to different types of
investors. For that reason, our valuation in the public stock market does
not reflect the quality of our portfolios. Our decision in favour of a
spin-off will allow us to reach our goal of listing BUWOG in a way that is
less dependent on the capital market sentiment than an initial public
offering. It will also give existing IMMOFINANZ shareholders an opportunity
to fully participate in the further development of BUWOG as a pure
residential property group and in IMMOFINANZ with its focus on the
commercial real estate business. In addition, BUWOG will gain the necessary
independence and access to more flexible financing opportunities',
explained IMMOFINANZ CEO Eduard Zehetner.
'This acquisition represents a milestone in the history of BUWOG which will
increase its portfolio to approx. 54,000 units with a gross asset value of
roughly EUR 3.49 billion. We will not only remain the largest private
investor in the residential property sector in Austria, but in a single
step become one of the major players on the German market. At the same
time, we differentiate ourselves from the competition with an integrated
business model that allows us to cover all relevant functions along the
real estate value chain in-house - from project development to
value-creating asset management and the sale of individual apartments or
entire buildings', said BUWOG CEO Daniel Riedl. 'BUWOG now has roughly the
same number of apartments in Germany and Austria, and has therefore
completed its strategy to build up a portfolio of similar size in both core
markets.'
Details on the portfolio and acquisition:
The portfolio with 1.09 million sqm of lettable space consists primarily of
residential properties in Schleswig-Holstein (approx. 990,000 sqm) and
Lower Saxony (approx. 85,000 sqm) as well as a smaller group of properties
in Mecklenburg-Western Pomerania (approx. 10,000 sqm) and Berlin (approx.
6,000 sqm). Of the total portfolio, 75% (by units) are located in the areas
surrounding Kiel, Lübeck, Hamburg and Braunschweig. The acquisition will
take the form of several share deals.
The portfolio generated annualised net cold rent of approx. EUR 68 million
based on a vacancy rate of 2.3%.
'The buildings, the regional profile and the potential for an increase in
value are highly attractive for a portfolio of this size. The geographic
distribution also fits exactly with our defined growth region in
North-Western Germany', explained BUWOG CEO Riedl. 'The current average
rents are - depending on the region - in part substantially below market
levels. Our business plan therefore assumes an upward potential for rents
in the future.'
The residential properties are currently managed by the asset and property
management platform of Prelios Deutschland. This platform with approx. 300
employees will be taken over by BUWOG in parallel to the portfolio
acquisition. 'This will not only ensure the smooth transition of the
portfolio management and equip us with a highly qualified and integrated
team, but will also form the basis for the internal management of the
entire German portfolio of the BUWOG Group over the medium-term. We will
therefore be able to realise synergy effects and ensure further
cost-efficient growth in defined regions' Riedl said. In addition, all
existing mandates for the property management of approx. 33,000 third
party-owned residential units will be transferred to BUWOG.
Financing:
The purchase price of approx. EUR 892 million for the above-mentioned
residential property portfolio is payable by BUWOG Group on the closing
date, which is expected to take place in the second quarter of 2014.
Financing for the purchase price is secured through a combination of
roughly EUR 402 million in already committed mortgage loans, approx. EUR
213 million of subsidised loans that will remain in the acquired property
companies and the proceeds from the planned issue of a convertible bond by
BUWOG. This market standard convertible bond is expected to have an issue
size between EUR 260 million and 310 million and a term of five years.
IMMOFINANZ will subscribe to the full amount of the BUWOG convertible bond.
The funds for the subscription will be provided by bridge financing of EUR
260 million from an investment bank and by internal cash sources.
On IMMOFINANZ Group
IMMOFINANZ Group is one of the leading listed property companies in Europe.
The company is included in the leading ATX index of the Vienna Stock
Exchange and also trades on the Warsaw Stock Exchange. Since its founding
in 1990, the company has compiled a high-quality property portfolio that
now comprises more than 1,600 investment properties with a carrying amount
of approx. EUR 10.1 billion. As a 'real estate machine' the company
concentrates on linking its three core business areas: the development of
sustainable, specially designed prime properties in premium locations, the
professional management of these properties and cycle-optimised sales.
IMMOFINANZ Group concentrates its activities in the retail, office,
logistics and residential segments of eight regional core markets: Austria,
Germany, Czech Republic, Slovakia, Hungary, Romania, Poland and Russia.
Further information under: http://www.immofinanz.com |
http://blog.immofinanz.com | http://properties.immofinanz.com
For additional information please contact:
MEDIA INQUIRIES
Bettina Schragl
Head of Corporate Communications | Press Spokesperson
IMMOFINANZ Group
T +43 (0)1 88 090 2290
M +43 (0)699 1685 7290
communications@immofinanz.com
INVESTOR RELATIONS
Stefan Schönauer
Head of Corporate Finance & Investor Relations
IMMOFINANZ Group
T +43 (0)1 88 090 2312
M +43 (0)699 1685 7312
investor@immofinanz.com
End of Corporate News
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Language: English
Company: IMMOFINANZ AG
Wienerbergstraße 11
1100 Wien
Austria
Phone: +43 (0) 1 88090 - 2291
Fax: +43 (0) 1 88090 - 8291
E-mail: investor@immofinanz.com
Internet: http://www.immofinanz.com
ISIN: AT0000809058
WKN: 911064
Listed: Freiverkehr in Berlin, München, Stuttgart; Frankfurt in
Open Market ; Wien (Amtlicher Handel / Official Market)
End of News DGAP News-Service
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