by Tom Sims and Matthias Inverardi
FRANKFURT (Reuters) – Germany’s largest real estate group Vonovia fell on the Frankfurt Stock Exchange on Friday after announcing its biggest loss ever in 2023, the latest sign of the difficulties encountered by the real estate sector of Europe’s largest economy.
Germany experienced a real estate boom over the past decade that ended abruptly with rising interest rates, hitting real estate companies like Vonovia hard.
The group recorded a loss of 6.76 billion euros last year, much more than the deficit of 669.4 million euros recorded in 2022.
Vonovia had to write down the value of more than 500,000 apartments it holds by 10.7 billion euros, bringing the total value of its portfolio to 84 billion euros.
“The collapse in valuations is the worst we have ever experienced,” Chief Executive Rolf Buch told reporters in a hastily arranged conference call on Thursday evening.
He said he saw signs of stabilization, while adding: “I’m not a prophet.”
LEG Immobilien and TAG Immobilien, two of Vonovia’s main domestic competitors, also announced losses for 2023 this week. For the three companies, the combined loss reached 8.7 billion euros.
(Written by Tom Sims and Matthias Inverardi, Blandine Hénault for the , edited by Kate Entringer)
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