DEMIRE Deutsche Mittelstand Real Estate AG: DEMIRE prolongs maturity of EUR 148 million promissory note at significantly better interest rate conditions

DGAP-News: DEMIRE Deutsche Mittelstand Real Estate AG / Key word(s): Bond/Real Estate

28.02.2017 / 09:36
The issuer is solely responsible for the content of this announcement.


DEMIRE prolongs maturity of EUR 148 million promissory note at significantly better interest rate conditions

- Group's average interest rate on borrowings falls to 4.1%

- FFO to increase annually by EUR 1.45 million starting in 2017

Langen, February 28, 2017 - DEMIRE Deutsche Mittelstand Real Estate AG (ISIN: DE000A0XFSF0) has prolonged the maturity of a promissory note in the amount of EUR 148 million early from its original maturity in 2019 to 2022 at better interest rate conditions. In doing so, the interest rate has been reduced retroactively as at January 1, 2017, from 5% p.a. to 4% p.a. without paying a penalty for early repayment. This decline brings the average interest rate on borrowings at the DEMIRE Group from 4.4% to 4.1%. As a result of the refinancing, funds from operations (FFO) are set to rise annually by EUR 1.45 million starting in 2017. In the event of a partial repayment, DEMIRE also has a one-time option to reduce the interest rate on the promissory note to 3.5% p.a. Such a reduction would lead to a potential further decline in financing costs to 4% and a rise in FFO of roughly EUR 2.2 million p.a.

The promissory note was originally issued in 2014 to refinance the Condor portfolio. Because the investors in the promissory note waived their option for a partial repayment agreed at the time of issuance, DEMIRE can now use the entire recent proceeds from the sale of non-core assets of around EUR 22 million for further growth.

Speaker of the Executive Board, Prof. Andreas Steyer, in his comments said: "The refinancing of the promissory note at significantly better conditions without a penalty for early repayment demonstrates DEMIRE's excellent standing among investors and banks and underscores the high quality of our portfolio. We are currently working on further ways to optimise our financing structure and are thereby fulfilling our goal of continually reducing borrowing costs and LTV in the DEMIRE Group and further increasing the Company's value."

The Management

 

Contact information

DEMIRE Deutsche Mittelstand Real Estate AG
Robert-Bosch-Straße 11

D-63225 Langen

Phone: +49 (0) 6103 - 372 49 - 0

Fax: +49 (0) 6103 - 372 49 - 11

ir@demire.ag
www.demire.ag

_______________________________________

About DEMIRE - First in secondary locations

DEMIRE Deutsche Mittelstand Real Estate AG has commercial real estate holdings in mid-sized cities and up and coming areas bordering German metropolitan areas. As at September 30, 2016, DEMIRE held real estate with a market value of EUR 985 million. As at the reporting date, annual contractual rents had been firmly agreed upon in the amount of EUR 75.5 million for an average term of 5.2 years.

DEMIRE aims to maintain its corporate organisation as lean as possible, although it still believes that economies of scale and portfolio optimisation are best achieved by having its own in-house asset, property and facility management. This safeguards the Company's business expertise and, equally important, allows the Company to maintain direct contact with the customer.

DEMIRE Deutsche Mittelstand Real Estate AG shares (ISIN: DE000A0XFSF0) are listed in the Prime Standard segment of the Deutsche Börse in Frankfurt.



28.02.2017 Dissemination of a Corporate News, transmitted by DGAP - a service of EQS Group AG.
The issuer is solely responsible for the content of this announcement.

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