HAMBURG, GERMANY-TAG Immobilien, based here, has purchased a portfolio of properties with 3,083 multifamily units and 71 retail stores for about $218 million. The deal also includes TAG acquiring shares in the five properties that own the portfolio.
Most of the properties are distributed throughout northern Germany, with many of them in Hamburg, Wolfsburg and Cuxhaven. About a quarter of the properties are in Saxony, in and around Dresden and Leipzig.
The vacancy rate of the sites is at 6.3%, the company said in a statement. Most of the inventory is post-World War II, with many units built in the late 1990s. The portfolio brings in about $18 million per year. TAG will take over the property management of the portfolio by the end of 2012.
The TAG management board has decided to issue about 5.5 million shares against the seller’s shares in the property companies. The issue price of the new shares is about $11.62 per share. Once the transaction is concluded, the sellers of the portfolio will own 7.8% of voting rights in TAG.
Acquiring the portfolio boosts TAG’s multifamily holdings by about 10% to 30,285 units. Rolf Elgeti, chairman of the management board, said in a statement that the company is continually and sustainably strengthening its position in the German real estate market. “This will have a positive impact on our cash flow,” he said.
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