The DIC Group is one of the leading investors in the German market for commercial real estate

Press Release

DIC Asset: complete takeover of a portfolio worth EUR 190 million

Frankfurt, 18.10.2011

• Portfolio growth target for 2011 already achieved
  
• Transaction significantly supports FFO growth
  
• Simplification of operative structures
  

With economic effect as of 1 October 2011, DIC Asset AG (WKN 509840/ ISIN DE0005098404) took over the 50 per cent stake in three joint ventures previously held by funds advised by Morgan Stanley Real Estate Investing. As a result, DIC Asset has become the sole owner of an attractive portfolio with a market value of some EUR 190 million consisting of around 20 office properties in Berlin and Frankfurt. The average initial rental yield in relation to the purchase price is 7.7 per cent.

The acquisition from the company's long-standing project partner has been effected via a share deal involving low transaction costs. A meaningful discount on the portfolio's existing net asset value (NAV) was also agreed on. Furthermore, the transaction allows DIC Asset to simplify its portfolio and asset management structures in the Core plus and Value added segments.

DIC Asset will assume the long-term financing of the previous joint ventures with an average loan-to-value (LtV) of some 70 per cent and an attractive average interest rate of 3.2 per cent, and will continue it on an unchanged basis.

DIC Asset's rental income will increase by some EUR 7 million year-on-year; FFO (operating income) will increase by some EUR 3.5 million over the same period. FFO contribution for the fourth quarter of 2011 thus amounts to around EUR 0.9 million.

As a result of the current takeover, DIC Asset has already achieved its planned portfolio growth of EUR 200-300 million for 2011: with the real estate purchases in March (EUR 108 million) and September (EUR 78 million), the portfolio increase this year already totals over EUR 280 million.

The portfolio encompasses a lettable area of some 90,000 sqm. The majority of rental income results from office space (some 72 per cent) and some 17 per cent from retail space. The properties from the Core plus and Value added segments benefit from a diversified tenant structure with tenants of high creditworthiness. The existing rental agreements have an average term of 5.6 years, with the occupancy rate at around 90 per cent. Consequently, the transaction will further improve the structure of DIC Asset's total portfolio.

Ulrich Höller, CEO of DIC Asset AG: "We have seized the opportunity to take over all of our partner's shares in this attractive portfolio, with which we have been familiar for years. With this transaction, we reinforce our cash flow and simplify operative structures."



About DIC Asset AG
Established in 2002, DIC Asset AG, with registered office in Frankfurt am Main, is a real estate company that focuses exclusively on investing in German commercial real estate and maximising earnings from its investments. The real estate portfolio amounts to approximately EUR 3.2 billion with around 280 properties. The portfolio is divided into three segments. The Core plus portfolio includes the proprietary portfolio held on a long-term basis and offering stable, attractive rental yields. The Value-Added portfolio contains real estate with promising performance potential over the medium term; while the Co-Investments portfolio comprises minority investments in other real estate segments. This includes opportunistic investments, project developments and the Funds business segment, which invests in Core real estate. DIC Asset AG has been listed on the SDAX index since June 2006 and is represented in the international EPRA Index for the most important real estate companies in Europe.

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