PRESS RELEASE

TAG Immobilien AG publishes guidance for 2022 after successful first nine months of 2021: FFO I and dividend expected to increase by 6% each.

- FFO I of EUR 137.5m (EUR 0.94 per share) in 9M 2021 represents 5% year-on-year growth; FFO I of EUR 46.0m (EUR 0.31 per share) in Q3 2021 slightly above previous quarter,

- EPRA NTA per share increased to EUR 23.88 in Q3 2021, up from EUR 21.95 as at 31 December 2020 (13% increase, after dividend pay-out of EUR 0.88 per share in 2021); further increase expected due to property valuation to be carried out at year-end,

- In Poland, successful business development and expansion of the contractually secured project development pipeline to more than 12,000 residential units (of which approx. 8,500 units for rent); new fifth location in Krakow,

- Confirmation of the guidance for 2021: FFO I of EUR 178-182m (EUR 1.23 per share) and dividend of EUR 0.92 per share,

- New guidance for 2022: FFO I of EUR 188-192m (EUR 1.30 per share) and dividend of EUR 0.98 per share.

Hamburg, 9 November 2021

Key operating figures and earnings trends

TAG Immobilien AG's (TAG) net actual rent ('net cold rent') was EUR 83.2m in the third quarter of 2021 and EUR 249.3m in the first nine months of 2021, representing an increase of 4.0% in comparison with the first nine months of 2020. Based on comparable portfolios (like-for-like), rental growth over the last twelve months, including the effects of vacancy reduction, amounted to 1.7% at 30 September 2021 (1.6% at 30 June 2021). Vacancy in the Group's residential units was 5.7% in September and has been declining over the past quarters, down from 5.9% in March and 5.8% at mid-year 2021. In October 2021, the vacancy rate was 5.6%.

Funds from operations (FFO I, excluding net income from sales), which are currently determined solely based on the rental business in Germany, increased by EUR 6.4m year-on-year to EUR 137.5m, or by 5%, in the first nine months of 2021. In addition to an improved operating result (3% increase in adjusted EBITDA), this was also due to lower financing costs and slightly lower income taxes. FFO I for Q3 2021 amounted to EUR 46.0m after EUR 45.9m in the previous quarter and EUR 44.6m in Q3 2020.

Consolidated net profit for the first nine months of 2021 was EUR 362.4m, compared to EUR 189.1m at 30 September 2020. The main reason for this significant increase was the higher result of EUR 310.6m from the property valuation carried out at mid-year (prior year: EUR 172.6m). Due to the continued strong demand for German residential real estate, especially in the 'B locations' preferred by TAG and in eastern Germany, this very positive trend is expected to continue with the next valuation on 31 December 2021.

EPRA Net Tangible Assets (EPRA NTA) increased to EUR 23.88 per share from EUR 21.95 as at 31 December 2020, despite the dividend payment of EUR 0.88 per share made in May 2021. The Loan to Value (LTV) ratio was 44.3% as at 30 September 2021, slightly down from year-end 2020 (45.1%).

Business performance in Poland

The business in Poland also delivered a very positive performance during the first nine months of the year. Compared to the same period of the previous year, revenues from sales increased significantly from EUR 40.9m to EUR 55.8m. The net income from operating activities in Poland, which is currently still generated almost exclusively from the sales business and is included in the Group's FFO II, amounted to EUR 6.1m in the nine-month period ended 30 September 2021, compared to EUR 2.5m in the prior-year period.

The contractually secured pipeline for the construction of residential units in Poland comprises approximately 12,100 units as of 30 September 2021. Of this total, approximately 8,500 flats are earmarked for letting, while approx. 3,600 are intended for sale. At the end of September 2021, around 330 units were in the letting process. All projects were completed on schedule and within budget. After the reporting date, land was acquired in Krakow for the construction of around 230 residential units, so that TAG is now represented in a total of five locations in Poland: Wroclaw, Poznan, Lodz, Gdansk and Krakow.

Guidance for the 2021 financial year confirmed, first-time publication of FFO and dividend guidance for FY 2022

The FFO I and dividend guidance for the year 2021 have been confirmed due to the very good and stable earnings development. The guidance and growth rates for the 2022 financial year are as follows:

- FFO I 2022: EUR 188-192m (2021e: EUR 178-182m), increase of around 6%

- FFO I per share 2022: EUR 1.30 (2021e: EUR 1.23), increase of around 6%

- Dividend per share for 2022: EUR 0.98 (for 2021e: EUR 0.92), increase of approx. 6%

The main reason for the expected increase in FFO by around EUR 10m is higher net actual rents (approx. EUR 6m) and lower financing costs (approx. EUR 4m).

As in the prior year, the guidance for 2022 relates exclusively to the German portfolio (without further acquisitions and disposals). For the Polish rental portfolio, which is still being built up, a roughly balanced result is expected.

Commenting on the guidance for the 2022 financial year, Martin Thiel, CFO of TAG, said: "Against the backdrop of the success we are seeing in financial year 2021, we expect an increase in FFO, FFO per share, and dividend per share of 6% for 2022, even without further acquisitions. Starting with the 2023 financial year, we will also be generating significant rental contributions in Poland, in addition to the already existing sales business. This means that we are currently represented in two very attractive residential real estate markets which, as regards the German portfolio, offer stability and reliability, while also, with regard to Poland, containing attractive and high-yield growth opportunities."

Further details on the third quarter of 2021 can be found in the presentation published today and in the interim statement at https://www.tag-ag.com/en/investor-relations/financial-statements/quarterly-reports.

Overview of key financials and portfolio data

Press enquiries:
TAG Real Estate AG
Dominique Mann
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