Trei Real Estate GmbH (Trei), a property developer and property asset holder for residential and retail real estate, increased its development volume to 730 million euros during the first half-year of 2019. This implies an increase by 45 million euros since year-end 2018 (December 2018: 685 million euros). Compared to the prior-year figure (H1 2018: 500 million euros), the growth actually amounted to 230 million euros, which equals an increase by 46 percent year on year. A breakdown of the 730 million euros by type of use shows 130 million euros in the retail segment (year-end 2018: 105 million euros) and 600 million euros in the residential segment (year-end 2018: 580 million euros).
Overall, Trei currently has around 3.300 residential units under development or in planning in Germany, the Czech Republic, Poland and the United States. The total breaks down into 1.600 units in Poland, 1.000 in Germany, 600 in the United States and around 100 in the Czech Republic. While the developments in Poland and the Czech Republic will deliver condominiums to be sold, the apartments constructed in Germany are earmarked for Trei’s proprietary portfolio. The residential developments in the United States are to be sold in the form of block deals.
The total value of the proprietary portfolio of Trei remained unchanged at 1.1 billion euros by mid-year 2019 (year-end 2018: 1.1 billion euros). All in, Trei had 383 portfolio properties under management as of 30 June 2019. Out of the total, 36 percent are located in Poland (136 assets) and 32 percent in Germany (123 assets).
Pepijn Morshuis, CEO of Trei Real Estate, commented: “During the first half-year of 2019, the focus was primarily on the expansion of our residential strategy. At the beginning of the year, we entered the housing development business in the United States with our first property development in Charlotte, North Carolina. At the same time, we completed our entry in the housing business on the Polish market. Our first development in Poland is located in Wrocław, with additional projects planned in the cities of Lodz, Poznan and Warsaw.”
The development activities in the retail property segment concentrate strongly on retail parks under the Vendo Park brand. Overall, Trei owns 36 Vendo Park properties, of which 20 already opened for business whereas the others are still under development or in the planning stage. Morshuis commented the fact by saying: “We intend to become the biggest retail park investor in CEE, especially in Poland.”
The transaction total by the end of H1 2019 amounted to 75 million euros. It breaks down into 63 million euros in property acquisitions and 12 million euros in property sales. Pepijn Morshuis commented: “On the acquisition side, our transactions clearly focused on plots intended for Vendo Parks and housing in Poland.”
With respect to the second half year of 2019, Morshuis commented: “In the United States, we are planning to kick off our next residential developments, in addition to the project already under construction in Charlotte. At the same time, we are pushing forward with our development activities in Germany. We will soon announce a plot purchase in a state capital in West Germany. Also worth noting is that our four developments in Berlin are proceeding as planned. But our key investment destination in the residential segment is probably Poland at the moment. With around 1.600 residential units, Germany’s eastern neighbour is the country where we have the highest number of apartments under development. In addition, Poland is also the most important destination country for our retail developments under the Vendo Park brand. Unlike in Germany, we have noted supply shortages in smaller and mid-sized cities here.”