Goldman Sachs-owned LEG Immobilien plans €1bn IPO

LEG Immobilien, a German residential real estate company majority owned by Goldman Sachs, announced plans today to float next month a crystallising a profit from for the investment bank which is expected to raise up to €1bn.

Goldman-SachsGoldman Sachs owns about 90% through its Whitehall Real Estate Fund, with Perry Capital owning the balance. LEG will list on the Frankfurt stock exchange.

LEG’s portfolio comprises around 91,000 housing units, located mainly in the north-western German region of North Rhine-Westphalia, valued at around €4.7bn including debt, with the net asset value of the housing portfolio of €2.37bn as at September 30, 2012.

Deutsche Bank and Goldman Sachs have been mandated as joint global co-ordinators and joint bookrunners. Berenberg, Commerzbank, Erste Bank and Kempen will act as co-lead managers.

Goldman Sachs and Perry Capital acquired LEG in 2008 from the state of North-Rhine Westphalia in a deal valued at €3.4bn.

The initial public offering of LEG will be one of two for Germany’s residential market, with Terra Firma seeking to list Deutsche Annington in the Spring. Goldman Sachs is expected to retain a stake in the listed LEG.

For Goldman Sachs, this will be the third major disposal by Goldman Sachs since the turn of December, following Highstreet, a consortium which includes Whitehall, sale of Berlin’s KaDeWe building and 16 other Karstadt department stores for €1.1bn to Austrian investor Signa. The transaction is expected to close during 2013.

Also last month, Goldman Sachs Whitehall Real Estate Funds sold a portfolio of five European Marriott hotels for €440m to Host Hotels & Resorts, the US hotel REIT.

The hotels comprise the Paris Marriott Rive Gauche hotel, the Courtyard Paris La Défense West-Colombes, the Renaissance Paris La Défense, Renaissance Paris Vendôme and Renaissance Amsterdam hotels.

The shares will be publicly offered to private investors in Germany, and to institutional investors nationally and internationally, by ways of a private placement.

In 2011, LEG achieved an adjusted EBITDA of €210.6m and funds from operations (FFO) of €111.8m.

jwallace@costar.co.uk

About CoStar News

Finance Editor, CoStar News
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