By Matthias Inverardi and Tom Sims
DUESSELDORF (Reuters) -Germany’s largest real estate group Vonovia on Wednesday posted a third consecutive annual loss for 2024, reporting further writedowns of its property values as the country’s real estate sector struggled.
The figures from Germany’s biggest residential landlord come as its property sector is mired in its worst crisis in decades, marked by insolvencies, stalled sales, falling prices and a decline in construction jobs.
The company’s 962.3 million euro ($1.05 billion) loss in 2024 was narrower than the previous year’s 6.76 billion euros. In 2022, the loss was 669.4 million euros, and Vonovia had previously experienced years of profit going back to at least 2010, according to LSEG data.
CEO Rolf Buch forecast better times ahead, predicting a return to net profit in 2025 with a stabilization of property values after a 2.3% writedown in 2024.
But he said plans by the German government for a massive spending surge have created uncertainty for the housing market, a reference to the fact that the new debt plans have already resulted in a rise in borrowing costs.
“The property market is currently reacting strongly to the German government’s announced investment plans. The medium and long-term effects on housing prices and financing costs are (as) yet uncertain,” he said.
He said the company was closely watching the situation and was prepared if necessary to put off more capital-intensive projects such as new building.
($1 = 0.9148 euros)
(Reporting by Matthias Inverardi and Tom Sims; Editing by Ludwig Burger and Jan Harvey)
