DENVER, July 31 /PRNewswire-FirstCall/ -- Archstone Europe Trading B.V., a wholly owned subsidiary of Archstone-Smith , one of the largest apartment companies in the United States, announced that it has completed the acquisition of Deutsche WohnAnlage GmbH ("DeWAG") for a purchase price of approximately $649 million (euro 518 million). This transaction follows Archstone's acquisition of an 822-unit portfolio in Mannheim in the fourth quarter of 2005 and its acquisition of a 657-unit portfolio in Berlin in May 2006, bringing the company's total German portfolio to 7,604 units.
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"We continue to see opportunity in the German residential real estate market, based on the country's low home ownership rate, the fact that rental rates are very low and affordable for the majority of the population providing significant room for future increases, and our ability to acquire assets at a significant discount to replacement cost," said R. Scot Sellers, chairman and chief executive officer, Archstone-Smith. "With the acquisition of the DeWAG platform we gain a collection of very attractive apartment assets in great locations throughout Germany, a management team that is very highly regarded and a highly attractive pipeline of new acquisitions."
DeWAG's portfolio has grown from approximately 200 housing units in December 2001 to more than 6,100 housing units today in major metropolitan areas across Germany. The majority of the residential units is suitable for privatization. The units are well located, close to transportation and shopping, abundant green spaces and single-family homes, and are above-average in size, with an average floor space of 710 sq. ft. (66 sq. m). The properties are near employment centers in some of Germany's most desirable metropolitan areas, including Rhein-Main (Frankfurt/Wiesbaden), Dusseldorf, Munich, Nuremberg and Aachen.
DeWAG's trading platform is recognized as one of the very best in Germany and is critical to taking advantage of currently low but steadily increasing home ownership rates. In addition, with this acquisition Archstone-Smith will retain the DeWAG staff and management, including managing directors Klaus Irtenkauf, Helmut Beyl and Mario Bohlen, who collectively have more than 60 years of German residential experience and will retain a 6% ownership position in the company. "Klaus, Helmut and Mario enjoy very strong reputations in the German real estate market and share Archstone's entrepreneurial spirit. We look forward to benefiting from their extensive real estate experience as we further develop and expand our European portfolio," said Dana Hamilton, managing director, Archstone B.V. / Archstone Europe Trading B.V.
Archstone-Smith , an S&P 500 company, is a recognized leader in apartment investment and operations. With a current total market capitalization of $19.3 billion, the company's portfolio is concentrated in many of the most desirable neighborhoods in the Washington, D.C. metropolitan area, Southern California, the San Francisco Bay Area, the New York City metropolitan area, Boston, Chicago, Southeast Florida and Seattle. The company continually upgrades the quality of its portfolio through the selective sale of assets, using proceeds to fund investments in assets with even better growth prospects. Through its two brands, Archstone and Charles E. Smith, Archstone-Smith strives to provide great apartments and great service to its customers -- backed by unconditional service guarantees. As of June 30, 2006, the company owned or had an ownership position in 267 communities, representing 82,491 units, including units under construction.
Archstone-Smith's archived press releases are available on its web site at http://www.archstonesmith.com/ or may be obtained by calling (800) 982-9293.
In addition to historical information, this press release contains forward-looking statements and information under the federal securities law. These statements are based on current expectations, estimates and projections about the industry and markets in which Archstone-Smith operates, management's beliefs and assumptions made by management. While Archstone-Smith management believes the assumptions underlying its forward-looking statements and information are reasonable, such information is necessarily subject to uncertainties and may involve certain risks, many of which are difficult to predict and are beyond management's control. As such, these statements and information are not guarantees of future performance, and actual operating results may differ materially from what is expressed or forecasted in this press release and supplemental information. See "Risk Factors" in Archstone-Smith's 2005 Annual Report on Form 10-K for factors that could affect Archstone-Smith's future financial performance.
Contact: H. Andrew Cantor
800-982-9293 303-708-5959
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