Ad-hoc Disclosures

14/12/2007 | Ad-hoc Disclosure

Fair Value REIT AG sells fund participation

  • Portfolio adjusted to secure now-obtained REIT status
  • Sale proceeds of at least € 10 million to be used for investments in offices and logistics premises


Munich, December 14, 2007 - Fair Value REIT AG today sold its majority interest in BBV Immobilien-Fonds Nr. 8 GmbH & Co. KG (BBV 08 KG) with effect from December 1, 2007. The main reason for this sale is the fact that reversal cannot be ruled out for the sale of a nursery home which was sold at the start of November 2007 as part of BBV 08 KG's portfolio, which otherwise comprises retail premises. As this nursery home could possibly be qualified as a residential property transferring it back to BBV 08 KG could have endangered Fair Value's status as a REIT.


This transaction was won by the highest-bidding IC Immobilien Holding AG with its registered office in Unterschleißheim. The fixed purchase price component of € 10 million is around 3% higher than the acquisition price paid when the interest was acquired. In addition, a variable price component was agreed: in so doing, Fair Value enjoys an 80% participation in the performance of the interest that exceeds the fixed price plus a minimum return on the fixed price for the acquiring party of 7% p.a. The latest settlement date for the variable remuneration is December 31, 2009, and the calculation also will include non-realized changes in value.


By selling this fund participation, the Managing Board is also continuing its strategy of focusing on the office and logistics segments in future by restructuring the portfolio and making new acquisitions. The income from the sale of the interest will be used accordingly.


At the end of December 2007 ownership is scheduled to be transferred for the directly acquired portfolio of 33 commercial properties in Schleswig-Holstein. These are mostly used as bank branches and this takes the portion of the portfolio's rent generated from retail properties down from 53% to 41%, whereas the proportion of rent from offices increases from 32% to 45%.


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A REIT – Higher Return for Investors

REIT stands for Real Estate Investment Trust. The assets of these listed companies in Germany consist mainly of real estate and investments in other real estate companies.


At the international level, REITs have been established for many years. On 1 January 2007, they were introduced in Germany as well.


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Fair Value REIT-AG