REG - Phoenix SpreeDeutsch - Termination of forward funding commitment

Phoenix Spree DeutschlandAnnouncement

08/01/2024 07:00

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RNS Number : 8461Y  Phoenix Spree Deutschland Limited  08 January 2024

Phoenix Spree Deutschland Limited

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

 

Termination of forward funding commitment to Erkner development project.

 

Phoenix Spree Deutschland (LSE: PSDL.LN), the UK listed investment company
specialising in Berlin residential real estate, announces the termination of
its forward funding commitment to a portfolio of development properties in
Brandenburg.

The development, located in Erkner, was a forward funded transaction to
develop 34 semi-detached houses in the outskirts of Berlin, and was due to
complete in Summer 2024.

The Company has elected not to continue with the project given the decline in
property values that has been observed across Berlin during the past 18 months
and more expensive financing conditions. The decision is in line with the
Company's previous commitment not to undertake further acquisitions and to
ensure leverage is maintained at an appropriate level  for the current stage
in the real estate cycle.

The counterparty to the transaction is The Grounds, a German real estate
developer. The Company had made an initial payment of €5.5m after
notarisation in March 2022, and the disposal removes the requirement to fund a
further €13m of development payments in 2024.

No penalty payments are attached to the cancellation of the project  and no
further payments will be made by the Company. The Company additionally
anticipates that it will be able to reclaim approximately €1.2m in real
estate transfer tax which had previously been incurred on the project.

This disposal accelerates the Company's strategy of reducing debt and,
ultimately, returning capital to investors from disposals. The impact on EPRA
NTA is expected to be less than one per cent.

Portfolio valuation and trading update

The Company intends to publish its Portfolio valuation and trading update for
the year ended 31 December 2023 on 7 February 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 7260 1000

David Benda

 

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

Lizzie Snow

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