REG - Phoenix SpreeDeutsch - Statement Re Share Price Movement

Phoenix Spree DeutschlandAnnouncement

13/03/2024 08:45

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RNS Number : 6741G  Phoenix Spree Deutschland Limited  13 March 2024

13 March 2024

 

 

Phoenix Spree Deutschland Limited

(the "Company", the "Group" or "PSD")

 

Statement Re Share Price movement

 

The Board of Phoenix Spree Deutschland Limited (LSE: PSDL.LN), the UK listed
investment company specialising in Berlin residential real estate, notes the
recent movement in the Company's share price.

 

The board believes that this reflects index reweighting ahead of the removal
of the Company from the FTSE EPRA index, which will become effective on Monday
18(th) March. The Board can confirm that it is not aware of any adverse
material change relating to the Company's trading, which remains consistent
with the business update issued on 7 February, highlights of which are
reiterated below.

 

The Board considers the current share price, which values the Company at a
 67 per cent discount to the most recently published EPRA NTA, and implies a
value per square metre of approximately half the cost of construction, does
not reflect the value of the underlying assets within the Portfolio.

 

Strong rental market

·    Growing shortage of available rental property in Berlin continues to
drive strong market rental growth.

·    New lettings across the Portfolio signed at an average premium of 31
per cent to passing rents, or €13.7 per sqm, a new record high, and a 5.9
per cent increase versus 2022.

·    Berlin EPRA vacancy of 1.6 per cent (2022: 2.4 per cent) at a record
low.

·    New rent table (Mietspiegel), expected to be released in May 2024 and
result in material in-place rent growth.

 

Condominium sales accelerating

·    Condominiums notarised for sale during H2 2023 of €5.2 million, a
206 per cent increase versus H2 2022, resulting in total sales of €7.2m for
2023.

·    A strong start to 2024 to date, with 4 further condominiums notarised
for a combined value of €1.9 million.

·    Material gap between the per sqm valuation of condominium units
versus rental unit equivalents, with sales prices per sqm of €4,885 per
vacant unit compared to a portfolio average of €3,587 per sqm for rental
units held within the portfolio.

 

Strategy and Outlook

·    Strategy of increasing asset sales (both as individual condominiums
and multi-unit assets), reducing debt and, ultimately, returning excess
capital to investors from disposals remains the Company's priority.

·    Since the onset of the current real estate downturn, there has been a
significant widening in the valuation premium that condominium units command
versus their rental equivalents.

·    With over 1,900 units, representing 77 per cent of the Portfolio, now
split as condominiums, PSD is uniquely placed in the listed marketplace to
benefit from this trend.

·    The company is examining strategic options, which will allow for a
significant increase in the number of individual units which can be made
available for sale in the future.

 

Full Year Results

The Company will report its full-year results, together with a comprehensive
update on its strategy, on 30 April 2024.

 

 

For further information, please
contact:                                          

 Phoenix Spree Deutschland Limited                                                                                                             +44 (0)20 3937 8760

 Stuart
 Young                                            

  
 Numis Securities Limited (Corporate Broker)                                                                                                   +44 (0)20 3100 2222

 David Benda                                                                                                                                    

                                                                                                                                                
 Teneo (Financial PR)                                                                                                                          +44 (0)20 7353 4200

  Lizzie Snow / Annushka Shivnani

 

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