Kungsleden begins international retirement homes initiative
Press Release 13 June 2006
Listed property company Kungsleden AB (publ) is beginning an international retirement homes initiative by acquiring nine retirement homes in Germany for EUR 74.3 m.
The properties comprise approximately 37,000 sq.m. of lettable floor-space, with a rental value of over EUR 5.5 m. The acquisition is being conducted at an estimated property yield of 7.0%, with Kungsleden taking possession on 1 September 2006.
HEWAG Seniorstift GmbH is the tenant, through a 15-year rental contract. HEWAG Seniorstift GmbH is a care provider that has conducted business in these properties, which since 1999, have a total of 680 residents.
Commenting on the transaction, Kungsleden's Chief Executive Jens Engwall said: “This deal marks our first step into Europe by acquiring these new, high-quality retirement homes in Germany, all built since the millennium. At present, Germany’s retirement homes have about 600,000 residents; this number is expected to increase to around 900,000 in 2025 to some 1.6 million by 2050. Our objective is to expand in this market over the next 6-12 months, and we perceive very bright prospects of doing so in Germany, where the ownership of retirement home properties remains fragmented.”