Deutsche Wohnen
Deal News | Feb 07, 2025 | EIN
The merger of Deutsche Wohnen and Vonovia, two of Germany’s largest property companies, has been finalized, potentially exacerbating the country's housing crisis. The deal, facilitated by tax maneuvers saving at least €1 billion, solidifies Vonovia as Germany’s largest private housing entity. This acquisition is set to increase rents further, as evidenced by last year's significant rent hikes. Nationwide, rent burdens over 30% on household incomes are common, and affordable housing shortages persist. Despite this pressing issue, the current election campaigns lack substantial measures to counteract escalating rents. The Left Party, with its rent control proposals, has a history of inaction, as evidenced by past government roles where they facilitated state-owned flat sales and inadequate new housing development. This merger has also seen big political support, despite 2021's pro-expropriation referendum result being ignored. Activists demand nationalizing large housing stocks without compensation to make housing affordable.
Sectors
- Real Estate
- Investment & Mergers
- Tax Strategy
Geography
- Germany – Germany is the primary geographical focus, being the location of the merger and the subsequent impact on the housing market.
- Berlin – Berlin is highlighted as a major area affected by the merger, influencing housing costs and market dynamics.
Industry
- Real Estate – The article discusses the real estate industry, focusing on the merger between two major property companies in Germany and its impact on the housing market.
- Investment & Mergers – The article involves a significant merger transaction between Vonovia and Deutsche Wohnen, highlighting investment and corporate consolidation activities.
- Tax Strategy – The article mentions tax maneuvers employed by Vonovia in the acquisition of Deutsche Wohnen, reflecting strategic financial management within the deal.
Financials
- €1 billion – Estimated taxes avoided by Vonovia through acquisition structuring.
- €20.11 per square metre – Average asking rent for newly built flats in Berlin as of 2024.
Participants
| Name | Role | Type | Description |
|---|---|---|---|
| Vonovia | Bidding Company | Company | The largest private housing corporation in Germany, acquiring Deutsche Wohnen to consolidate its position. |
| Deutsche Wohnen | Target Company | Company | A major German property company acquired by Vonovia in a significant merger deal. |
| Rolf Buch | CEO of Vonovia | Person | He announced plans for further property acquisitions to increase market share. |
| Lukas Siebenkotten | President of the German Tenants Association | Person | He commented on the deteriorating conditions for tenants due to rising rents. |
| Left Party | Political Party | Government | The party endorses rent control policies but has been criticized for inactivity concerning housing issues during past governance. |
| Sebastian Scheel | Senator for Urban Development and Housing | Person | Welcomed the merger between Vonovia and Deutsche Wohnen, indicating collaboration between government and property companies. |