Financial year 2019: Another successful year

- Excellent operational performance with l-f-l rental growth of 2.4%, reduction in vacancy to 5.4% and increase in average in-place rent to EUR 5.60 per sqm/month, in line with the 2019 guidance

- Net rental income increased by 4.3% to EUR 248.7m

- FFO I grew by 13.7% to EUR 84.4m

- EPRA NAV (excl. goodwill and fully diluted) up by 39.3% to EUR 2,283.6m

- 91.93% (94.15% incl. treasury shares) of ADLER shareholders accepted takeover offer by ADO to create one of the largest listed residential real estate companies in Europe

Berlin, 31 March 2020 - In these challenging times driven by the Covid-19 pandemic, the safety and wellbeing of our tenants and employees remains our top priority. We are following all Public Health and Government guidelines to ensure everyone stays safe and we help to limit the spread of the virus. We are in discussions with our tenants and are considering rent deferral schemes for the vulnerable. The management board would like to thank the German health service and key workers for their exceptional and selfless efforts to safeguard the German population. We also offer our sincere condolences to any of you who have lost friends or family to the virus.

Our balance sheet and liquidity position are robust with significant headroom against debt covenants and we do not expect any material impact on FFO for 2020. Combined with ADO Properties (ADO), the Group has EUR 500 million of cash at hand.

Another very strong year for ADLER Real Estate AG (ADLER) reflecting in the company not only meeting, but in many cases exceeding, its financial targets for the year. Net rental income was EUR 248.7 million, in excess of a target range of EUR 235-240 million. At EUR 84.4 million, FFO I was in the middle of the forecast range of EUR 83-86 million. Average rent was on target at EUR 5.60 per sqm per month and the vacancy rate came to 5.4%, better than the target of 6%. LTV (excl. convertibles) as of 31 December 2019 stood at 51.4%, better than the 55% target.

Net rental income increased by 4.3% to EUR 248.7m YoY
As of FY 2019, ADLER's portfolio comprised of 58,083 units. Net rental income increased by 4.3% YoY to EUR 248.7m for the year 2019. This significant increase was driven by operational improvements with all our main key performance indicators improved. ADLER achieved l-f-l rental growth of 2.4%, and a 60bps YoY decrease in vacancy rate to 5.4%. The average in-place rent increased to EUR 5.60 per sqm/month (FY 2018: EUR 5.49 sqm/month).

FFO I grew by 13.7% to EUR 84.4m
FFO I amounted to EUR 84.4m, representing 13.7% YoY increase (FY 2018: EUR 74.2m). Fully diluted FFO I per share amounted to EUR 1.06 (FY 2018: EUR 0.94). The strong growth in FFO reflects our positive operational performance and ongoing management to reduce our cost of debt.

EPRA NAV increased further by 39.3% to EUR 2,283.6m
As of 31 December 2019, EPRA NAV (excl. goodwill and fully diluted) amounted to EUR 2,283.6m, a 39.3% increase compared to EUR 1,639.0m as of FY 2018. Diluted EPRA NAV per share (excl. goodwill) was EUR 28.59 (FY 2018: EUR 20.77).

LTV reduced by 10ppts to 51.4% compared to FY 2018
With the proceeds from the sale of the non-core portfolio and large parts of BCP's commercial portfolio ADLER was able to reduce debt. Furthermore, consolidation of ADO Properties had a positive impact on net financial liabilities and correspondingly LTV, which has reduced by 10ppts to 51.4% as of Q4 2019.

Successful combination with ADO
On 15 December 2019, ADO made a voluntary public tender offer to acquire all outstanding shares of ADLER offering 0.4164 shares in ADO for one share in ADLER. The exchange ratio was derived from ADO's and Adler's EPRA NAV per share, in each case as of 30 September 2019. As of 30 March 2020, ADO reported the final acceptance ratio with 94.15% (91.93% excl. treasury shares) of ADLER shareholders accepting takeover offer by ADO to create one of the largest listed residential real estate companies in Europe. ADO and ADLER will consolidate about EUR 8.5 billion in combined residential assets. ADO's high quality Berlin portfolio will be complemented by ADLER's Germany-wide portfolio, focused on German cities with attractive yield potential.

ADO also acquired a 22.18% strategic minority stake in CONSUS, Germany's leading residential developer focused on rental product in top-9 cities. The strategic stake, together with CONSUS shares already owned by ADLER, amount to an ownership position of around 25% of CONSUS. Furthermore, a call option has been agreed with Aggregate Holdings SA ("Aggregate"), CONSUS' 51% shareholder. The combined company may exercise its call option at any time until June 2021 with the consideration being paid in newly created ADO shares, at an exchange ratio of 0.2390 ADO shares for each CONSUS share, provided that this ratio will be adjusted to any dividends and equity raise done by ADO or CONSUS, as relevant.

The ongoing housing shortage in Berlin and other densely populated regions in Germany is an issue which the combined company takes seriously. It is committed to easing the pressure on the market through accelerating the construction of new stock suitable for rent. Through CONSUS, the combined company will gain exposure to a market-leading development platform with a high quality pipeline of over 15,000 residential rental units in top-9 cities.

We will be hosting a conference call today, 31 March 2020, at 3pm CET / 2pm GMT / 9am EDT. For dial in details and link to the webcast please follow the below link:

The complete annual report of ADLER Real Estate AG for the financial year 2019 is available on the company's website (-ag.com).

Your contact for enquiries:
Tina Kladnik
Head of Investor Relations
ADLER Real Estate AG
Tel: +49 (162) 424 6833