Rising Rents, Stable Leverage, And Dividend Cut Support Vonovia's Credit Profile

PARIS (S&P Global Ratings) March 21, 2023--Despite the current inflationary pressures weighing on German households' purchasing power, real estate holding company Vonovia SE (BBB+/Stable/A-2) was able to raise rents steadily and maintain high collection and occupancy rates of 99.8% and 98%, respectively, in 2022. The company's financial performance for the year was in line with S&P Global Ratings' expectations, including steady rental income growth, contained asset valuation decline, and an announced dividend cut. German Residential REITs Face A Mixed Outlook In 2023, Feb. 20, 2023 Outlooks On Vonovia And Deutsche Wohnen Revised To Stable On Tougher Market Conditions; 'BBB+' Ratings Affirmed, Nov. 11, 2022

...PARIS (S&P Global Ratings) March 21, 2023--Despite the current inflationary pressures weighing on German households' purchasing power, real estate holding company Vonovia SE (###+/Stable/A-2) was able to raise rents steadily and maintain high collection and occupancy rates of 99.8% and 98%, respectively, in 2022. The company's financial performance for the year was in line with S&P Global Ratings' expectations, including steady rental income growth, contained asset valuation decline, and an announced dividend cut. Vonovia's rental income growth is in line with our assumptions. The company posted a 3.3% like-for-like increase in rental income for the full year after 3.4% in first-half 2022, which is within the 3.0%-3.5% range we forecast in November (see "Outlooks On Vonovia And Deutsche Wohnen Revised To Stable On Tougher Market Conditions; '###+' Ratings Affirmed," published Nov. 11, 2022). This compares with 3.2% in 2021 and 3.1% in 2020, and includes Deutsche Wohnen, which Vonovia acquired...

News