Johannes Meran, conwert SE

Johannes Meran is the Chairman and Co-founder of conwert, an entrepreneurial investment company focusing on equity investments in the German speaking and Central and Eastern European regions. Europe Real Estate found out his view on the residential market in Central Europe.

Tell us a little bit about yourself and conwert.

The focus of our business activities at conwert is to add value to residential properties in strongly growing metropolitan areas in Germany and Austria. In the past two years, we have been successfully refocusing the overall strategy of our business. The core of the new business model places value in the generation of sustainable earnings through the efficient management of a portfolio of high-yielding residential properties. This means that we have significantly reduced the company's dependence on volatile, project-related buy/sell trading of properties. By doing so, we have successfully laid the foundations for stable company development and growth, which we can already see today. We have just announced the best operational half-year earnings in the company's history, which are already above the 2010 and 2011 full year results.

How is the residential market doing in Central Europe compared to the rest of Western Europe?

In the last couple of years the residential market in Central Europe has certainly suffered more than Western Europe. Even though it might have recovered to a certain degree, we at conwert have made a clear decision to only focus our business activities on high-yielding residential properties in Austria and Germany. From our perspective, we can add the most value for our clients, partners and shareholders in this particular business segment. Maintaining and strengthening our geographic footprint in Germany remains the core focus of our strategy today.

You are now active in Austria, the Czech Republic, Germany and Hungary, do you have any plans to expand further in the near future? Where?

Our overall strategic goal is to strengthen our residential business in our two core markets in Germany and Austria. Simultaneously, we are gradually streamlining our portfolio in Eastern Europe and aim to sell the entire current CEE portfolio – which accounts for only 4% of our entire portolio – within the next two years. Moreover, our goal is to reduce the share of commercial properties in the total portfolio from almost 40% to about 20%.

What kind of residential assets do you specialize in? Who are you targeting in particular?

Our objective is to be the leading residential property portfolio holder with a regional focus on Austria and Germany. In particular, we are targeting high-yielding residential properties in strongly growing metropolitan areas such as Berlin, Potsdam, Leipzig and Dresden. In August this year, we strengthened our presence in Germany with the acquisition of a large residential property portfolio of 4,016 rental units and a floor space of 265,815 m². Before that we acquired a majority stake in the Hamburg-based KWG Kommunale Wohnen AG, thus adding some 9,700 units in Germany with a total area of 605,000 m² to our portfolio.

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