DEMIRE withdraws 2020 guidance due to uncertainty caused by COVID-19 effects

Langen, 09. April 2020 - Given the uncertainty about the further course, duration and effects on the overall economic development as a result of the COVID-19 crisis, the Management Board of DEMIRE Deutsche Mittelstand Real Estate AG (ISIN: DE000A0XFSF0) today decided to withdraw the guidance for rental income and Funds From Operations* for the 2020 financial year, which was published on 18 March 2020.

The restrictions on public life as a result of the COVID-19 crisis as well as the negative impact on the economy and the resulting effects on the business development of DEMIRE's tenants cannot be seriously assessed at present. To date, however, DEMIRE has already been informed by 63 tenants, representing a total monthly rent of EUR 1.98 million (equivalent to, on a per month basis, roughly 2,2% of the total annual rent of DEMIRE), that they do not or not fully intend to pay their rent in the coming months - limited until June 2020 due to the COVID-19 Insolvency Suspension Act (COVInsAG). Among them is a tenant of commercial properties who announced on April 1, 2020 that he had filed an application with the local court Essen for the initiation of so-called protective shield proceedings which entail self-administration.

Although DEMIRE assumes that the rents not paid on time will be paid later, an uncertainty about the recoverability of certain claims remain. In addition, there is uncertainty as to the extent to which the aforementioned protective shielding procedure will have an impact on the rent receivables accruing in this respect.

The Management Board of DEMIRE is constantly reviewing the current situation. However, due to the fact that the effects of the COVID-19 crisis cannot be reliably predicted at present, it is not possible for the Management Board to release a sufficiently reliable, concrete new guidance for the 2020 financial year at this time. The Management Board is therefore currently refraining from publishing a new forecast.

DEMIRE Deutsche Mittelstand Real Estate AG

The Management Board

 

* Funds from Operations (FFO I) after taxes, before minorities as defined in the 2019 annual report: https://www.demire.ag/files/demi-gb2019-12uk-b1_2.pdf

Contact:

DEMIRE Deutsche Mittelstand Real Estate AG
Michael Tegeder
Head of Investor Relations & Corporate Finance
Tel.: +49 6103 372 49 44
Email: [email protected]

About DEMIRE Deutsche Mittelstand Real Estate AG

DEMIRE - REALize Potential

DEMIRE Deutsche Mittelstand Real Estate AG acquires and holds commercial real estate holdings in mid-sized cities and up-and-coming locations bordering German metropolitan areas. The Company's specific forte is its focus realising asset-based potentials on these second-tier cities - its claim being "REALize Potential" - and on a range of assets that appeals to both internationally active and regionally rooted tenants. After acquiring an office and a department store portfolio as well as a distribution centre over the course of 2019, along with the profitable divestment of smaller, non-strategic assets, DEMIRE holds a portfolio of about 90 properties with a combined lettable area of around 1.1 million m² and a market value of about EUR 1.5 billion (as of 31 December 2019).

The portfolio focus is on office with addition of attractive retail, hotel and logistics assets results in exactly the kind of risk/return structure that DEMIRE considers appropriate for the business line of commercial real estate. The Company puts a premium on long-term contracts with solvent tenants and realising potential in anticipation of stable and sustainable rental revenues. For further growth, DEMIRE intends to acquire strong, cash-generating assets bearing potential, while non-strategic properties will be divested. DEMIRE has set itself the goal to keep optimising its corporate structure. To this end, it pursues an active property management approach, convinced that it is the best way to achieve economies of scale and portfolio optimisations.

DEMIRE Deutsche Mittelstand Real Estate AG shares (ISIN: DE000A0XFSF0) are listed in the Prime Standard segment of the Frankfurt Stock Exchange.