German residential specialist Phoenix Spree sees leap in NAV

Another AIM-listed German property specialist, Phoenix Spree Deutschland, also posted a sizeable rise in pretax profit for the full year 2015 after growth in both rents and property values, which saw the company increase its overall net asset value.

The group is primarily focused on residential property in Berlin and other secondary Germany cities. Its portfolio consists of 115 separate properties containing 2,365 separate rental units. Berlin represents about 66% of its total value.

Pretax profit was €13.0m for the year ended December 31, up from €8.5m a year earlier, despite incurring costs relating to its stock market listing in June. Annualised rental income rose to €14.1m at end-year, up 3.2% from a year earlier.

The company said its portfolio valuation increased 15% to €282.8m at year-end from €254.3m the previous year, and said its property values rose by 11% on a year-on-year basis. As a result the company is paying a maiden full year dividend of 4.2 pence per share. The current stock price is about Stg£1.80.

In March Phoenix Spree raised a further Stg£36.6m in a share placing, which PMM Partners in Germany, which manages the Phoenix Spree assets, said would now enable it to fund "an attractive pipeline of opportunities", to be invested over the next 12 to 18 months.

According to board chairman Robert Hingley, "Since listing in June 2015 we have delivered against our strategic objectives of delivering value to shareholders by growing our German residential portfolio, particularly in Berlin where there is still a significant supply/demand imbalance. We have also grown rental incomes throughout the year due to the active asset management of the portfolio and unlocked further value by reselling apartment blocks as condominiums at a premium to rental property values."

"The outlook for the German residential market remains positive and there is significant opportunity for us to continue to grow the portfolio", he added.