Billion deal: corporations give up apartments on land

Berlin (dpa) – After months of negotiations, a multi-billion dollar deal for the municipalization of apartments in Berlin is wrapped up.

Three state-owned companies buy the Vonovia and Deutsche Wohnen groups 14. 750 apartments and 450 commercial units and pay for it 2 ,46 Billion euro. This was announced by everyone involved on Friday.

The deal a week before the election to the House of Representatives is the largest of its kind in the capital for a long time. Originally the companies had the country up to 20. 000 apartments offered. The red-red-green state government is pursuing the goal of expanding the municipal housing stock through new construction and acquisitions. She hopes to have more influence on the tense housing market and to be able to curb the rise in rents. The estimated good 30. 000 Affected tenants would now have security “that their apartments will be permanently in the low-priced segment”. The bosses of Vonovia and Deutsche Wohnen, Rolf Buch and Michael Zahn, were just as satisfied with the deal, which knows many winners and no losers.

Both corporations, which number 1 and 2 on the German housing market and want to merge in the course of a tough process on the stock market, are selling around ten percent of their holdings in Berlin. Good 10.000 of the apartments come from Deutsche Wohnen and 4250 from Vonovia. The stock of communal apartments in turn increases to around 355. 000. That is a good fifth of the 1, 67 million rental apartments in the capital.

The three municipal companies Howoge, Degewo and Berlinovo finance the business with loans. They rejected fears, for example from the Berlin House of Representatives, that they would have to cut back on urgently needed housing due to this additional burden. “We will continue the new building as before, it can be even more,” said Howoge managing director Ulrich Schiller.

The apartments in the package are spread across all twelve Berlin districts and come with one Average size of 68 square meters rather small. Entire settlements are included, such as the Falkenhagener Feld in Spandau, the thermometer settlement in Lichterfelde and the high-deck settlement in Neukölln, but also smaller holdings.

Senator of Finance Kollatz named the 2400 euros per square meter. That would be good on average 163. 000 Euro per apartment. It is the earnings value, which is below the market value. They are to be assessed as “affordable housing stock,” said the Senator. Vonovia boss Buch spoke of a “fair price”.

Some of the apartments have already been in municipal hands. One or two decades ago, Berlin had around the 200 000 Apartments sold at comparatively low prices – which is now generally seen as a mistake.

Regarding the condition and age of the quarters, it was said that some came from the 70 he or 80 years, others were only built a few years ago. Some of them have been renovated, but also some – as was common in the 70 and 80 years – Asbestos panels built into the flooring. The municipal companies put the additional investments they want to make in the coming years for renovation or technical repairs at around 380 million euros.

The CEOs of Buch and Zahn evaluated the housing business as proof that their companies were “reliable partners” for politics and society in solving problems on the Berlin housing market. They recalled the voluntary commitment of both groups to limit rent increases in Berlin to 2026 and 13 000 to build new apartments.

In the capital, the asking rents have been in recent years increased more than in other metropolises. In some parts of the city, even average earners have a hard time finding affordable accommodation. Queues to view vacant apartments are long.

This situation, along with headlines about how tenants are dealt with and the rent caps with state-set upper limits that the Federal Constitutional Court has now collected, increased the pressure on landlords. In addition, the Berliners on 26. September can vote in a referendum parallel to the parliamentary and Bundestag elections on the expropriation of large housing groups. Against this background, the bosses of Deutsche Wohnen and Vonovia have been adopting conciliatory tones for some time.

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