TAG Immobilien AG (TAG), through its 100% Polish subsidiary Vantage Development S.A., today signed an agreement to acquire 5,322 rental apartments from R4R Poland sp. z o.o. z o.o. (Resi4Rent). The transaction is expected to close at the end of the third quarter or in the course of the fourth quarter of 2025, depending on clearance by the Polish antitrust authority.
The purchase price for the portfolio of PLN 2,405 million (approx. EUR 565 million based on the current EUR/PLN exchange rate of approx. 1:4.25) will be adjusted at the time of closing by the working capital available in the property companies holding the properties and to be acquired by TAG. TAG does not assume any financial liabilities.
The 5,322 rental units to be acquired have a total usable area of approx. 177,700 sqm and are located in the six largest cities in Poland: Warsaw (1,755 units), Wroclaw (1,653 units), Poznan (571 units), Krakow (535 units), Lodz (506 units) and Gdansk (302 units). In total, there are 18 projects, most of which were newly built in the last three years and, with a vacancy rate of usually only approx. 2%, are almost fully let. Leasing has begun on five projects in the last twelve months, two of which have only been completed in the last few weeks and are therefore currently still in the first phase of leasing activities.
The purchase price will be paid using the TAG Group's existing cash and cash equivalents, which amounted to EUR 870 million as of 30 June 2025. TAG's liquidity will be supported by a bridge financing of up to EUR 600 million with a maturity of up to 24 months, which has been provided by Bank of America and Société Générale and is to be refinanced through various potential capital market instruments, market conditions permitting.
After all acquired projects have been fully leased and taking into account the synergies to be achieved within the Group, TAG expects a net actual rent of approx. PLN 175-180 million (approx. EUR 41-43 million), a rental result of approx. PLN 163-167 million (approx. EUR 38-40 million) and a contribution to adjusted EBITDA of approx. PLN 140-145 million (approx. EUR 32-34 million) and a contribution to adjusted EBITDA of approx. PLN 140-145 million (approx. EUR 32-34 million) in the 2026 financial year. The purchase price thus corresponds to a gross initial yield on net actual rent of approx. 7.5% expected by TAG and an expected yield on rental income of approx. 6.8% in 2026.
Further details on the impact on TAG's key financial figures will be known after the transaction has been completed. They are expected to be announced with the forecast for the 2026 financial year, which will be published with the interim statement for the third quarter of 2025.
Assuming the successful completion of the transaction, the total Polish real estate volume would increase to approximately EUR 2,000 million (30 June 2025: EUR 1,464 million). The total real estate volume in Germany, TAG's core market, amounted to EUR 5,318 million as of 30 June 2025 on the basis of the approximately 83,000 apartments there.
Claudia Hoyer, COO and Co-CEO of TAG, explains: "With the help of this acquisition, we will achieve our strategic goal of having around 10,000 rental apartments in Poland by the end of 2028 at the latest, much earlier than planned. As a result, we will very soon have a high-quality and high-yield new construction portfolio in the six largest cities in a country that has excellent fundamentals both for the economy as a whole and for the housing market. At the same time, we continue to see growth opportunities in Poland. We will therefore be able to continue to expand our rental portfolio step by step in the coming years and focus on the most attractive projects."
Poland's economy has shown remarkable resilience in recent years, consistently outpacing the GDP growth of the other EU-27 countries, even during economic downturns such as the pandemic. This underlines the strong domestic demand. The continued decline in the unemployment rate in Poland reflects the constant creation of jobs and the flexibility of the labour market. This trend is further supported by favourable demographics and higher labour force participation of the younger generations. The Polish housing market continues to face a significant housing shortage. Poland has one of the smallest in the European Union in terms of living space available per inhabitant and one of the highest in terms of the average number of persons per household. In addition, almost 50% of the apartments were built between 1945 and 1988 and do not meet the quality requirements of today's residents.
Based on these strong fundamentals and trends, Poland has seen a significant increase in sales prices (from approx. +40% to +60% depending on the location, depending on the location) and rents (from approx. +25% to +40%, depending on the location) in the country's six largest cities since the beginning of 2022.
As already reported on 12 August 2025, the first half of the 2025 financial year was very successful for the TAG Group. With FFO I of EUR 91.6 million, an increase of 4% was achieved compared to the same period of the previous year. The Polish sales business also recorded an increase in earnings in the second quarter of 2025 to EUR 11.6 million (Q1 2025: EUR 5.0 million). For the German real estate portfolio, the first half of 2025 saw the continuation of the positive valuation trend already observed at the end of 2024. The value of the portfolio increased by approx. 1.4% after approx. 0.9% in H2 2024. Supported by a strong performance in the Polish rental portfolio, this led to an increase in the NTA per share to EUR 20.18 (31 December 2024: EUR 19.15) and a further decline in the LTV to 45.3% (31 December 2024: 31 December 2024): despite the dividend of EUR 0.40 per share paid out in June. 46,9%).
On this basis, and as a result of the strong growth in the Polish rental portfolio following the completion of the transaction, TAG's operating cash flow increased significantly. Against this background, it is planned to increase the payout ratio for the dividend to at least 50% of FFO I. This is to apply for the first time to the dividend for the 2026 financial year. With regard to the dividend for the current 2025 financial year, the previous payout ratio of 40% of FFO I is still planned.
Martin Thiel, CFO and Co-CEO of TAG, adds: "With the acquisition of this portfolio, we have taken a major step forward from the growth planned for the next few years. Therefore, supported by a very successful first half of 2025, we can now increase the payout ratio for the dividend earlier than planned. Nevertheless, we will not lose sight of our conservative and disciplined financing policy of recent years. This current acquisition proves that TAG can take advantage of attractive opportunities in the market from a position of financial strength in order to achieve sustainable economic growth."
