Vonovia signs €500m refinancing deal

Berlin Hyp has written a 10-year loan to extend the maturity profile of the German residential giant.

Vonovia, Germany’s largest listed residential landlord, has sourced a €500 million loan from German bank Berlin Hyp to refinance portfolios in North Rhine-Westphalia, Bavaria and Rhineland-Palatinate.

The 10-year loan will refinance 270 properties which are almost fully leased. The portfolios comprise roughly 900,000 square metres in residential and 4,800 square metres in commercial space.

“By signing the secured loan agreement on attractive terms, we were able to further optimise our maturity profile,” said Artur Stefan Kirsten, member of Vonovia’s management board.

He added the firm’s financing strategy focuses on a balanced mix of unsecured and secured instruments.

Last December, Vonovia agreed to acquire Austrian housing group Buwog. With a total portfolio of about 50,000 apartments in Germany and Austria, the acquisition was worth about €5.2 billion, with a German share of approximately €2.9 billion.

Other German property companies, such as Patrizia, have built foreign residential portfolios in markets including the Netherlands and the Nordics, demonstrating the expansion of large residential property investors across Europe.

Foreign investors are also expanding into the German residential property market, which saw transaction volumes reaching €15.7 billion in 2017, 15 percent above the previous year, according to JLL.

The growth of foreign investment into Germany, the boom in project developments and price increases for existing portfolios could lead to a repeat of last year’s transaction volume of around €14 billion-€15 billion in 2018, JLL said.