PRESS RELEASE

TAG Immobilien AG buys residential real estate portfolio with nearly 3,000 units

Hamburg (18 December 2013) - TAG Immobilien AG ('TAG') today acquired a residential real estate portfolio with approximately 2,860 residential units and 57 commercial units at a purchase price of EUR 70.5 million. The properties are distributed to various locations in former East Germany, including Rostock and Dresden and Berlin, cities where TAG already has branches. The largest individual locations are Cottbus with 416 units and Chemnitz with 660 units. TAG also has a strong local infrastructure in place at these two locations. The total rentable area is approximately 170,000 m², the current annual rent at around EUR 8.6 million, and the overall portfolio is distributed to twelve locations.

The buildings are mostly renovated and has interesting development potential given the vacancy rate of 12.6 % and the fact that it was purchased from complex ownership circumstances. TAG intends to invest approximately EUR 3 million in the as-yet unrenovated part of the inventory in the years ahead, and to increase the annual rent to well over EUR 9 million p.a. Of the portfolio, which was acquired by way of an asset deal, 2,450 units will be taken over on 01 January 2014. About 340 units are slated for resale in the medium term.

Overall, the acquisition increases TAG's inventory of residential flats to more than 70,000 units and will increase TAG's operating cash flow and FFO long-term.

Rolf Elgeti, CEO of TAG, comments on the acquisition: 'This purchase underscores one of TAG's key and strategic competitive advantages. The portfolio itself is relatively widely scattered, which reduces the pool of potential buyers. However, it is scattered to locations where we already have a presence. This allows us to leverage our local expertise for the acquisition while also using our rather dense network of banks in the region for financing. Beyond this, there are further economies of scale on the administrative side, so we can handle this entire purchase with our existing team.'

Press enquiries:
TAG Immobilien AG
Head of Investor & Public Relations
Dominique Mann
Phone +49 (0) 40 380 32 300
Fax +49 (0) 40 380 32 388
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