TAG Immobilien has acquired 1,770 German residential units in two deals totalling €49 mln.
TAG Immobilien has acquired 1,770 German residential units in two deals totalling €49 mln.
In the first transaction, the listed German landlord purchased a portfolio of 1,500 homes in the federal states of Saxony and Saxony-Anhalt for almost €38 mln.
The properties are spread across the university cities of Freiberg, Chemnitz and Dresden. The rentable area of 85,000 m3 generates an annual rent of €3.7 mln, reflecting a net initial yield of 9.7%.
The portfolio has a vacancy rate of nearly 13% as the properties date mostly from the 1970s and '80s and have only been partly renovated since then. TAG said it will therefore be able to exploit their value-add potential, especially in Chemnitz, through investment and upgrades in the years ahead.
In addition, TAG has purchased a portfolio in Dessau in Saxony-Anhalt with 270 extensively renovated units and an area of 17,000 m2 for €11 mln. Renovated in 2000-2001 and consistently maintained since then, the portfolio has no vacancy. The transfer of ownership is scheduled for`1 October 2014, and of the portfolio located in Saxony for 1 November.