London-listed Phoenix Spree in fresh capital-raising drive
The Jersey-headquartered, London-listed Phoenix Spree Deutschland says it plans to raise Stg£ 38m (about €49m) along with a placing programme to allow it to raise further capital over the coming year.
The closed-end investment company has already received confirmation for the lion’s share of the capital increase (Stg£ 33mn) from investment company Liberum, who brought Phoenix to the stock exchange last year.
The company said it plans to use the funds raised from the issue to invest in accordance with its strategy of investing in residential property in Berlin and various secondary German cities. It will propose a placing programme to raise capital between March 7th 2016 and February 8th, 2017, as and when it identifies properties that are suitable, it says.
Since June 2015, Phoenix has purchased five Berlin residential properties for an aggregate of €35.8mn which it says will increase net rental income of €1.6mn per year or 10.4 %. The company can increase rental income by 6% per year on average, Phoenix partner Mike Hilton says, adding that Phoenix is planning comprehensive modernization efforts, so it is not immediately affected by the new rent control regulation in the city.
Assets under management consist of 115 properties containing 2,175 residential units, 190 commercial units, 3 commercial buildings (office, retail), 491 garages/car parking spaces and 40 miscellaneous rental units (e.g. including cellars, storages, antennas) with a total lettable area of 173,000 sqm, located in 22 locations across Baden-Wuerttemberg, Bavaria, Berlin, Bremen, Lower Saxony, Schleswig-Holstein and Brandenburg.
The company's assets were independently valued by JLL at €282.8m as at 31 December 2015, representing a value per square metre of €1,635, a gross fully-occupied yield of 5.7%, a net initial yield of 3.7% and a net reversionary yield of 5.4%. EPRA net yield on the assets was put at 4.6%.