FDL forks out €351m in Berlin and Dresden

Foncière des Régions' residential arm FDL has invested €351 mln in four German residential portfolios in line with its strategy to grow in the country's housing sector.

FDL, which is almost 60% owned by Foncière des Régions, has bought a total of 4,000 residential units, largely located in Berlin (78% by value) and Dresden (21%)

The assets were acquired on the basis of an average gross yield of 6.5% and have potential for value creation, with an average reversion rate of over 20%.

'The German residential sector represents an attractive diversification for Foncière des Régions, which is focused on offices and key accounts,' the Paris-based group said in a statement.

Following the deal, Berlin makes up 21% of the company's €2.4 bn of German residential assets, versus 10% at the end of 2012.

French REIT Foncière des Régions took control of its German residential arm Foncière Développement Logements last month, doubling its stake to nearly 60% in a deal valued at €1 bn. FDL is now fully consolidated within FdR.

FdR has been the majority shareholder of FDL since establishing the subsidiary in 2005. The housing unit currently owns a portfolio valued at €3.2 bn, three quarters of which is located in Germany with the rest in France.