As part of its portfolio refocusing efforts, Fair Value REIT-AG has sold two further properties which were no longer part of its core portfolio. The sale proceeds generated totaled €18.1 million. A directly-held bank building in Henstedt-Ulzburg (Segeberg County) was sold to private investors, while the Hotel Crowne Plaza Schweizerhof with office and commercial space in Hannover held by a subsidiary was sold to a company belonging to the hotel operator. The transfer of ownership, risks and benefits took place on expiry of January 31, 2014 following the payment of purchase prices.
The sale price for the bank building in Henstedt-Ulzburg, Hamburger Straße 83, with floor space of around 1,000 m² corresponded with the last determined market value of €1.1 million.
The hotel with office and commercial space in Hannover, Hinueberstraße 6, which no longer fitted the company’s strategy was sold at a price of €17 million, around 13% down on the last determined market value. The property has a lettable area totaling around 19,460 m². Facing the building age of around 33 years significantly higher maintenance costs are to be expected in the future. The sale price is being completely used to repay bank liabilities at the subsidiary. The liabilities are therefore significantly reduced to around 35% of the subsidiary’s remaining property values.
Frank Schaich, CEO of Fair Value REIT-AG, comments on the transactions: “We have once again sold two non-strategic properties. Although the sale price achieved for the hotel is below the market value determined by experts a year ago, this move means that the subsidiary, in which we hold a roughly 60% stake, will have a substantially higher equity backing in future and will be in a position to make higher dividend pay-outs to the partners.”
Source: Fair Value REIT