Coreo AG / Key word(s): Real Estate
Acquisition of a real estate portfolio with 1,356 units by Coreo AG - MagForce shares as part of the purchase price
Frankfurt am Main, Germany - 14 July 2021- Today, Coreo AG acquired by way of a share deal a real estate portfolio consisting of 1,341 residential and 15 commercial and other units with a rental area of approx. 73,900 m². The company acquired 89.9% of the German limited liability company (GmbH) shares in the portfolio-holding company as part of the transaction. The real estate is distributed across 10 locations in the German states of Berlin, North Rhine-Westphalia, Mecklenburg-Western Pomerania, Saxony-Anhalt, and Thuringia.
Coreo AG' s Management Board, which focuses on exceptional real estate situations, considers the portfolio to be unmanaged and assumes that it will be able to sustainably increase the current net annual rent of EUR 3.8 million by means of targeted asset management. Coreo AG will take an active role in initiating and implementing the required measures with immediate effect.
The seller will take over MagForce shares in the amount of 1.45 million held by Coreo on a valuation basis above the current share price level as a down payment and first partial purchase price instalment. The parties agreed not to disclose the total purchase price and the details of the purchase contract.
Closing is expected to take place in 2022.
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Today Coreo AG acquired a real estate portfolio composed of 1,341 residential, 8 commercial and 7 other units. It also includes 41 parking spaces and garages with a total rental area of approx. 73,900 sqm. Structured as a share deal, the company is acquiring from the seller 89.9% of the GmbH shares of the portfolio holding real estate company.
The portfolio comprises a total of 27 separate business units spread over the German locations Berlin (1), Duisburg and Mönchengladbach in North Rhine-Westphalia (6), Schwerin, Crivitz, Brüsewitz, Leezen in Mecklenburg-Western Pomerania (16), Halle and Genthin in Saxony-Anhalt (3) and Obermehler in Thuringia (1).
The Management Board of Coreo AG, which is focused on extraordinary real estate situations, anticipates a sustainable increase in the portfolio's current annual net rent of approximately EUR 3.8 million. The main focus is on increasing the occupancy rate from approximately 77% at present through the introduction of professional asset management tailored to the respective local requirements. Investment of up to one year's net rent in the portfolio over the next 3-5 years is an essential part of the scheduled measures. From now on, Coreo AG will be actively involved in the implementation process in order to ensure that the objectives agreed in the purchase contract are achieved.
The approximately 1.45 million MagForce shares held by Coreo AG will be transferred to the seller as a down payment on the purchase price on the basis of a valuation above the current share price. Current financing will not be taken over.
Coreo's real estate assets and annual net rent will increase to over EUR 100 million and over EUR 7.5 million, respectively, with the closing scheduled for 2022.
Marin N. Marinov, Chairman of the Board: "Coreo is not only moving considerably forward on its growth path with by far the largest acquisition in the company's history. The company's real estate volume exceeds the first significant threshold of EUR 100 million. Thanks to the structuring of the purchase contract, we have substantially reduced possible risks without compromising on the considerable potential for value creation. By virtue of our expertise, we are more than confident that we will be able to sustainably increase current rental income in the following quarters. Coreo became a pure real estate company by using the MagForce shares as a down payment. Our growth opportunities gained from the corporate financing completed at the end of 2021 and fully disbursed in March will be used for further acquisitions in the near future."
About Coreo AG
14-Jul-2021 CET/CEST The DGAP Distribution Services include Regulatory Announcements, Financial/Corporate News and Press Releases.
60322 Frankfurt am Main
+49 69 2193 96-0
+49 69 2193 96-150
Regulated Unofficial Market in Berlin, Dusseldorf, Frankfurt (Basic Board), Hamburg, Munich, Stuttgart, Tradegate Exchange
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