S IMMO: Successful sale of German residential properties
Today S IMMO has entered into contracts regarding the sale of a part of its German residential portfolio to “Deutsche Investment Wohnen III”, a fund managed by Deutsche Investment, together with EB GROUP. The transaction comprises approximately 1,500 residential units in Berlin and Hamburg. In terms of space, this corresponds to a third of the German residential portfolio or about 20% of S IMMO’s total German portfolio. The transaction is expected to close within the next months.
With this transaction S IMMO realises the so far achieved increase in value for this part of the portfolio. At closing, this transaction will result in a net inflow (after deduction of credit financing) of approximately EUR 140m.
The sale will also positively contribute to the revaluation result for the first six months of 2016. That result from property revaluation will amount to roughly EUR 106m (the final figures for the first half year will be announced on 25 August). Moreover, a significant profit will arise from the reversal of deferred tax liabilities at closing. Overall, the sale will significantly strengthen S IMMO’s balance sheet structure and increase its equity.
Ernst Vejdovszky, CEO of S IMMO, comments: „We have purchased these properties for the most part nine years ago and earned good money with them since. It is a crucial part of our cycle-oriented strategy to cash in our investments when markets are at high levels. That’s why we have decided to sell roughly a third of our German residential portfolio. Thereby, we create value for our shareholders.” However, Germany clearly remains in S IMMO’s focus. The company has recently acquired two large properties in Hamburg and Leipzig and thus added above 30,000 m² to its German office portfolio.
S IMMO has been advised by VICTORIAPARTNERS as financial advisor and by CMS Hasche Sigle in legal and tax matters.