Last checked at 
8 Jan 2024 07:00
Phoenix Spree Deutschland Limited (the "Company", the "Group" or "PSD")
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Termination of forward funding commitment to Erkner development project.
Phoenix Spree Deutschland (LSE: PSDL.LN), the UK listed investment company specialising in Berlin residential real estate, announces the termination of its forward funding commitment to a portfolio of development properties in Brandenburg.
The development, located in Erkner, was a forward funded transaction to develop 34 semi-detached houses in the outskirts of Berlin, and was due to complete in Summer 2024.
The Company has elected not to continue with the project given the decline in property values that has been observed across Berlin during the past 18 months and more expensive financing conditions. The decision is in line with the Company's previous commitment not to undertake further acquisitions and to ensure leverage is maintained at an appropriate level for the current stage in the real estate cycle.
The counterparty to the transaction is The Grounds, a German real estate developer. The Company had made an initial payment of ?5.5m after notarisation in March 2022, and the disposal removes the requirement to fund a further ?13m of development payments in 2024.
No penalty payments are attached to the cancellation of the project and no further payments will be made by the Company. The Company additionally anticipates that it will be able to reclaim approximately ?1.2m in real estate transfer tax which had previously been incurred on the project.
This disposal accelerates the Company's strategy of reducing debt and, ultimately, returning capital to investors from disposals. The impact on EPRA NTA is expected to be less than one per cent.
Portfolio valuation and trading update
The Company intends to publish its Portfolio valuation and trading update for the year ended 31 December 2023 on 7 February 2024.
For Further Information, Please Contact:
Phoenix Spree Deutschland Limited +44 (0) 20 3937 8760
Stuart Young
Numis Securities Limited (Corporate Broker) +44 (0) 20 7260 1000
David Benda
Teneo (Financial PR) +44 (0) 20 7353 4200
Lizzie Snow