Phoenix Spree Deutschland has announced the acquisition of an apartment complex located in Friedrichshain, Berlin. The purchase price is €16m which works out at a price per square metre of €2,580 or a prospective gross yield of 4.8%. they say the deal will increase the Fund’s rental income by c. 6%.
The apartment complex is located in one of Berlin’s most ‘in-demand’ locations: Boxhagener “Kiez”, Friedrichshain. It was constructed in 1996, has c. 6,200 square metres of net leasable area, and is currently fully occupied. In addition to 63 residential units, the Property has four commercial units, the largest of which is tenanted by denn’s Biomarkt, a national supermarket chain. The property is located in Boxhagener “Kiez” in Friedrichshain, one of the most in-demand Berlin locations, and is well served by public transport. It also attractively located adjacent to Boxhagener Platz, a popular square consisting of many bars and restaurants.
As at 31 June 2015, the complex had a contracted rent roll of c€760,000 per annum and the Acquisition will increase the Fund’s rental income by c6%. The Acquisition is expected to complete in autumn 2015 after which the Fund’s Berlin properties are expected to represent c66% of the Fund’s gross assets.
They will finance the deal with existing cash resources, however it is expected that the Fund will refinance the acquisition and it has received indicative offers of finance from German lending banks. PMM Partners, the Property Advisor, believes that in the medium term individual apartments could be sold as individual units to owner occupiers at a premium to the acquisition value.
The Fund has also completed the disposal of commercial property Hünxerstrasse 155, Dinslaken. The Property was sold for €1.44m and the majority of proceeds will be used to repay loans outstanding on the property. The disposal value was in line with book value.
PSDL : Phoenix Spree buys Friedrichshain apartment complex