Portfolio Structure

As of December 31, 2018, Vonovia had a total real estate portfolio comprising 395,769 residential units, 117,885 garages and parking spaces and 5,144 commercial units. Our locations span 709 cities, towns and municipalities in Germany, Austria and Sweden. 84,333 residential units are also managed for other owners. Most of the properties in the Group’s portfolio are multifamily residences.

In terms of fair value, most of the properties (around 90%) are located in Germany. The Austrian portfolio accounts for around 6% of the fair value, while the Swedish share of the portfolio comes to around 4%.

As of December 31, 2018, the Group’s real estate portfolio across Germany comprised 358,451 residential units, 93,030 garages and parking spaces and 4,022 commercial units distributed across 526 cities, towns and municipalities. The total living area amounted to 22,364,651 m², with the average apartment size coming in at around 62 m². With a vacancy rate of 2.4%, Vonovia generated an average monthly in-place rent of € 6.55 per m² in Germany. The annualized in-place rent came to € 1,715.6 million for apartments, € 52.2 million for commercial units and € 28.4 million for garages and parking spaces.

In the Austrian portfolio, which is largely located in Vienna, Vonovia achieved an annualized in-place rent of € 89.6 million, with a vacancy rate of 4.4%, in the residential portfolio, which comprises 23,030 units covering total living space of 1,720,579 m². The monthly in-place rent amounted to € 4.53 per m² with an average apartment size of around 75 m².

Our Group’s portfolio also includes the Swedish real estate portfolio, consisting of 14,288 units with a total living space of 1,015,134 m². With a vacancy rate of 1.2%, the residential portfolio generated annualized in-place rent of € 109.7 million. The apartments, which average 71 m² in size, generate monthly in-place rent of € 9.11 per m². Most of them are located in the Gothenburg, Stockholm and Malmö regions.

Changes in the Portfolio

At the beginning of the fiscal year, the takeover of BUWOG AG saw our portfolio increase by an additional 48,320 apartments, the majority of which are located in Lübeck, Berlin and Vienna. Later on in the year, we incorporated an additional 14,052 residential units into our portfolio when we took over Victoria Park AB, whose properties are mostly located in the Gothenburg, Stockholm and Malmö regions.

The acquisition portfolios were as follows at the time of the takeovers:

In the course of 2018, properties in the “Sell” portfolio were disposed of in several sales during the implementation of the portfolio management strategy.

At the time of the sale, the statistics for the portfolios sold were as follows:

In addition to the acquisition and sale of larger housing stocks, Vonovia’s portfolio changed in 2018 as a result of additions arising from tactical acquisitions, the construction of new apartments and attic extensions on the one hand, and disposals of condominiums and multifamily residences from the portfolio earmarked for sale on the other. Furthermore, our regular portfolio reviews due to strategic reassessments resulted in certain housing stocks being reallocated within the overall portfolio. As part of the review, we also made an adjustment to the structure of our portfolio in addition to the strategic reassessment:

The “Recurring Sales” subportfolio now combines all units for which preparatory measures for individual sale have already been taken and which are now set to be sold off on an ongoing basis over the next few years. This new definition increases the number of apartments in this category to 29,563 compared with the former “Privatize” portfolio. Likewise, the designation of further subportfolios was also adjusted; however, this did not result in content changes for the respective strategies.

Following the implementation of the annual structured reassessment of all potential, as of December 31, 2018, Vonovia’s residential portfolio is as follows:

In order to boost transparency among the portfolios, we showed our extended portfolio in 15 regional markets for the first time in our reporting in 2016. The regional market classification is orientated toward the residential real estate market regions in Germany. These markets are core towns/cities and their surroundings, mainly metropolitan areas. Our decision to focus on these regional markets that are particularly relevant to Vonovia is our way of looking ahead to the future and provides an overview of our strategic core portfolio in Germany.

In relation to the fair value, 91% of our German portfolio is located in 15 defined regional markets. Only a small part of our strategic stock is located outside of these 15 markets. We have referred to this group as “Other strategic locations” (around 7% of the total fair value). The regional market breakdown does not include our housing stocks from the “Non-core Disposals” and “Recurring Sales” subportfolios in locations that do not include any strategic stocks.

As of December 31, 2018, the strategic core portfolio is as follows, broken down into regional markets:

A look at the largest regional markets, from Berlin to the Rhine-Main region, the Rhineland, the southern Ruhr region, Dresden, Hamburg and Munich, already shows our balanced presence in strong markets across Germany. In addition to these focal points, we also have properties primarily in very prosperous regions, such as Hanover, Leipzig and Freiburg.

The fact that our portfolio is spread nationwide means that we are independent of the circumstances prevailing on individual regional markets.