Fonciere des Regions agreed to buy 4,000 homes in Berlin and Dresden for 351 million euros ($477 million) to grow rental income.
Fonciere Developpement Logements, 59.7 percent owned by Fonciere des Regions, bought the assets last month, bringing total spending on German properties this year to 394 million euros, Paris-based FDR said in a statement today.
FDR started FDL in 2005 to invest in European homes. FDL has been increasing its holdings in Berlin, where about a fifth of its 2.4 billion-euro German residential portfolio is located, to capitalize on the city’s booming residential market. Home prices there have risen about 48 percent in the past five years, according to data compiled by Immobilien Scout GmbH.
FDR will “position itself in the best locations” so it can “maintain an attractive like-for-like growth rate in rental incomes,” the company said in the statement.
The portfolios were bought at an average gross yield of 6.5 percent, the company said.