**Summary**
Phoenix Spree Deutschland Limited (PSD), a UK-listed investment company specializing in German residential real estate, reported its financial results for the year ended December 31, 2025. The company announced its first return of capital to shareholders under its managed Portfolio realisation strategy, approved in March 2025. Key highlights include
**Financial Performance** Gross rental income decreased to โฌ22.7 million from โฌ28.1 million in 2024, primarily due to property sales and condominium conversions. The company reported a loss before tax of โฌ13.6 million, improved from a โฌ39.5 million loss in 2024.
**Portfolio Valuation** The total portfolio value stabilized at โฌ540.1 million, with a like-for-like increase of 1.5% per square meter. The Condominium Sales Portfolio and PRS Portfolio both showed valuation increases, indicating a stabilizing Berlin residential market.
**Condominium Sales** PSD exceeded its 2025 target, notarizing 122 units for โฌ36.0 million, a 20% increase from the โฌ30 million goal. Since year-end, an additional 56 units have been notarized, and 35 units are under reservation.
**Capital Returns** The company announced a ยฃ17.5 million return to shareholders through a pro-rata Compulsory Redemption of Ordinary Shares, with a redemption price of ยฃ2.56 per share. The Board aims for two annual capital returns, subject to strategy implementation and cash balance retention.
**Refinancing** In November 2025, PSD completed a โฌ255 million, five-year, interest-only refinancing, removing previous restrictions on condominium sales and shareholder distributions, thereby enhancing operational flexibility.
**Cost Reduction** PSD prioritizes cost reduction in 2026 as the portfolio contracts. Administrative expenses in 2025 included non-recurring items related to refinancing and strategy implementation, expected to decrease in future periods.
**Outlook** The company enters 2026 with positive momentum, supported by an expanded condominium sales pool, completed refinancing, and a clear capital return framework. The Berlin condominium market remains resilient, and PSD expects regular capital returns from net sale proceeds.
The Chairmans statement emphasized the successful transition from planning to execution in 2025, with accelerated condominium sales, refinancing, and the launch of a capital return framework. The company is focused on disciplined delivery, maximizing value from condominium sales, returning capital to shareholders, and reducing costs as the portfolio contracts.
### Key Observations:
1. **Gross Rental Income**: Decreased by 19.2% due to the sale of properties and the accelerated condominium sales program.
2. **(Loss) before tax**: Improved by 65.6%, indicating better operational efficiency despite reduced rental income.
3. **Portfolio valuation**: Marginally decreased by 2.3%, reflecting market conditions and asset disposals.
4. **EPRA NTA per share**: Declined by 4.2%, likely due to valuation adjustments and costs associated with the realisation strategy.
5. **Net LTV**: Slightly increased by 1.7%, possibly due to refinancing and debt restructuring.
6. **Condominium sales notarised**: Significantly increased by 283.0%, aligning with the accelerated sales strategy.
7. **Annual like-for-like rent per sqm growth**: Halved to 0.8%, reflecting strategic focus on sales over rental growth.
8. **EPRA vacancy**: Increased by 173.3%, driven by units held vacant for refurbishment and sale preparation.