conwert acquires residential properties from ECO (AT)

conwert Immobilien Invest SE has taken over the 50% share in the Allianz-Trading portfolio (€52.0 million) which had previously been held by ECO Business-Immobilien AG, and other properties in Austria and Germany worth €61.3 million, which are primarily used for residential purposes. The purchasing price agreed upon is based on the assessment by independent experts at 31 December 2008. Due to the current market environment and the resulting valuations, the total purchasing price of €113.3 million is below historical cost. The yield from rents of the properties acquired totals 5.7%. With the proceeds from this sale, ECO will largely repay its liabilities to conwert, which equalled €42.2 million at 31 December 2008.

conwert now owns 100% of the Allianz-Trading portfolio, which was acquired together with ECO in 2006. It consists of 41 high-quality residential properties in good locations with total usable space totalling approx. 78,000 m². The properties were taken within increased strategic focus on the sale of properties. Due to the currently high demand for direct residential property investments, conwert will push to appraise and subdivide these properties for resale and sell them as freehold flats. As a result of the complete acquisition, conwert will now benefit 100% from the proceeds from the sale of these properties.

Moreover, conwert is taking over two senior residences (total usable space 14,700 m², 60 garage spaces) in Bavaria/Germany and a hotel completed in early 2009 with an adjacent retail park (total usable space 4,500 m², 120 parking spaces) in Austria, thus strengthening the business segment "Temporary Housing". All properties are fully rented out and have long-term rental contracts with operators with excellent credit ratings. These properties are characterized by a high annual rental income totaling €2.7 million. The yield based on the purchasing prices (€32.5 million) thus equals 8.4%.

Furthermore, a prestigious building was acquired in Vienna's third district on Schwarzenbergplatz. At €28.8 million, the purchasing price was approx. 10% below the acquisition price originally paid by ECO due to market-related decreases in value. Capacity utilization of the objects equals 96%. Based on the current purchasing price, the rental yield amounts to approx. 4%. With the average rental price amounting to €9.6/m², this property has further potential for an increase in rental prices due to its prime location.

The total transaction volume in the amount of €113.3 million also includes long-term borrowings equalling €78.0 million with average remaining terms of 19 years. The average interest rate as of 31 December 2008 amounts to 3.87%.

Source: conwert

Related News