Phoenix Spree D Regulatory News (PSDL)

13 March 2024

Phoenix Spree Deutschland Limited

(the "Company", the "Group" or "PSD")

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Statement Re Share Price movement

The Board of Phoenix Spree Deutschland Limited (LSE: PSDL.LN), the UK listed investment company specialising in Berlin residential real estate, notes the recent movement in the Company's share price.

The board believes that this reflects index reweighting ahead of the removal of the Company from the FTSE EPRA index, which will become effective on Monday 18th March. The Board can confirm that it is not aware of any adverse material change relating to the Company's trading, which remains consistent with the business update issued on 7 February, highlights of which are reiterated below.

The Board considers the current share price, which values the Company at a 67 per cent discount to the most recently published EPRA NTA, and implies a value per square metre of approximately half the cost of construction, does not reflect the value of the underlying assets within the Portfolio.

Strong rental market

· Growing shortage of available rental property in Berlin continues to drive strong market rental growth.

· New lettings across the Portfolio signed at an average premium of 31 per cent to passing rents, or ?13.7 per sqm, a new record high, and a 5.9 per cent increase versus 2022.

· Berlin EPRA vacancy of 1.6 per cent (2022: 2.4 per cent) at a record low.

· New rent table (Mietspiegel), expected to be released in May 2024 and result in material in-place rent growth.

Condominium sales accelerating

· Condominiums notarised for sale during H2 2023 of ?5.2 million, a 206 per cent increase versus H2 2022, resulting in total sales of ?7.2m for 2023.

· A strong start to 2024 to date, with 4 further condominiums notarised for a combined value of ?1.9 million.

· Material gap between the per sqm valuation of condominium units versus rental unit equivalents, with sales prices per sqm of ?4,885 per vacant unit compared to a portfolio average of ?3,587 per sqm for rental units held within the portfolio.

Strategy and Outlook

· Strategy of increasing asset sales (both as individual condominiums and multi-unit assets), reducing debt and, ultimately, returning excess capital to investors from disposals remains the Company's priority.

· Since the onset of the current real estate downturn, there has been a significant widening in the valuation premium that condominium units command versus their rental equivalents.

· With over 1,900 units, representing 77 per cent of the Portfolio, now split as condominiums, PSD is uniquely placed in the listed marketplace to benefit from this trend.

· The company is examining strategic options, which will allow for a significant increase in the number of individual units which can be made available for sale in the future.

Full Year Results

The Company will report its full-year results, together with a comprehensive update on its strategy, on 30 April 2024.

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