Member Article

Newcastle’s Grainger brings forward sale of German JV for £97m

Newcastle-based Grainger plc has announced an agreement with its partner, Heitman, to bring forward an exit from their German joint venture and sell it to a large German investor, for a total consideration of £97m.

As at 30 September 2015, the German JV portfolio comprised c.2,500 residential properties, located throughout Germany, primarily in the western regions.

The residential property owner and manager will receive a total gross consideration of £34m for its 25% interest in the JV and performance related premium return on equity, subject to closing balance sheet adjustments.

The sale should generate a pretax profit compared to the 30 September 2015 investment value of £11m which will be treated as a non-recurring item.

Today’s announcement follows on from Grainger’s previously stated intention to sell its wholly owned German assets, which is currently underway.

Andrew Cunningham, Chief Executive Officer, said: “Having taken advantage of the strong investor appetite for German residential assets, this transaction is evidence of further progress in our objective to simplify the business, enabling Grainger to focus resources on its core competencies and recycle capital into growing our UK private rented sector portfolio.”