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HOWOGE acquires around 4,500 apartments and secures land reserves for building public housing

Berlin, 24 April 2024. HOWOGE Wohnungsbaugesellschaft mbH is purchasing PRIMA Wohnbauten Privatisierungs-Management GmbH (PRIMA) with 4,495 apartments in the Berlin boroughs of Lichtenberg and Treptow-Köpenick from Vonovia SE. Together with Berlinovo Immobilien Gesellschaft mbH, it is also purchasing from Vonovia SE the company Stadtentwicklungsgesellschaft Buch mbH (SEG Buch). These strategic acquisitions at a purchase price of EUR 700 million constitute an overall package. The transfer of shares in the companies is planned to take place as of 1^st January 2025.

With the exception of a residential complex in Adlershof with 95 residential units, PRIMA’s portfolio is located entirely in the borough of Lichtenberg in close proximity to HOWOGE holdings. In particular, 2,350 apartments are located in Friedrichsfelde, 1,223 apartments in Fennpfuhl and 647 apartments in Lichtenberg itself. For the most part, these are refurbished buildings with a pre-fabricated design that are de facto fully let. As HOWOGE managing director Ulrich Schiller explains, “PRIMA’s apartments are an excellent match for HOWOGE. The location, construction method and condition of the properties are very much comparable to our holdings and fit seamlessly into our property management model. With an average rent of EUR 7.04 per square metre, they are also eminently suitable as public housing.” At significantly below one per cent, the vacancy rate of the properties is extremely low. The PRIMA portfolio also contains two commercial units, 47 other units and 873 parking places. HOWOGE is also purchasing the glass fibre network and solar cell systems that belong to the properties.

Together with Berlinovo Immobilien Gesellschaft mbH, HOWOGE is also purchasing SEG Buch, whereby its share is 74 per cent. The object of purchase is a plot of land in Berlin-Buch that forms part of the designated planning area Buch-Am Sandhaus. The overall plot has an area of 40 hectares, of which 26 hectares are a buffer area and around seven hectares future building land. The remaining area is grassland. As Ulrich Schiller points out, “HOWOGE is already the owner of numerous plots of land in the area of the new residential neighbourhood that is planned. With the acquisition of these new plots of land, the neighbourhood can be developed almost entirely by public sector entities.”

HOWOGE will finance the acquisition with existing liquidity and a balanced and efficiently designed mix of secured and unsecured financial instruments. “The sound capital structure of HOWOGE and balanced financial instruments enable us to react to purchase opportunities like these and, at the same time, to actively invest in new builds and our existing holdings,” says HOWOGE managing director Katharina Greis. “With the purchase of almost 4,500 apartments, HOWOGE is strengthening its position as a public housing company and meeting its social responsibilities.”

Prior to the purchase, there were on-site viewings, and a careful external and internal due diligence process was conducted in which economic, financial, legal and technical issues were examined. EY and Greenberg Traurig assisted with the transaction in a consultative capacity.

About HOWOGE

HOWOGE Wohnungsbaugesellschaft mbH is one of the six publicly owned housing companies belonging to the State of Berlin. With a housing portfolio of 76,400 apartments (as of 31^st December 2023), the company is one of the largest landlords in Germany. In the medium to long term, HOWOGE intends to expand its housing portfolio, particularly through new builds, to around 100,000 apartments. As part of the Berlin school building campaign, HOWOGE is also taking on for the State of Berlin the refurbishment of existing schools and the building of new ones.

“Designing a liveable Berlin of tomorrow – more than just a place to live”

Important notice:

This publication is neither an offer to sell nor a solicitation to buy securities.

To the extent that this announcement contains forward-looking statements, such statements do not represent facts and are characterised by the words “expect”, “believe”, “estimate”, “intend”, “aim”, “assume” or similar expressions. Such statements express the intentions, opinions or current expectations and assumptions of HOWOGE Wohnungsbaugesellschaft mbH and are based on current plans, estimates and forecasts which HOWOGE Wohnungsbaugesellschaft mbH has made to the best of its knowledge, but which do not claim to be correct in the future. Forward-looking statements are subject to risks and uncertainties that are difficult to predict and usually cannot be influenced by HOWOGE Wohnungsbaugesellschaft mbH. It should be kept in mind that the actual events or developments may differ materially from those contained in or expressed by such forward-looking statements.