Business Outlook

Vonovia can report positive business development in the first nine months of the 2021 fiscal year despite the ongoing coronavirus pandemic. All business segments showed positive development.

The forecast for the 2021 fiscal year was based on the accounting principles used in the consolidated financial statements.

Our forecast for the 2021 fiscal year is based on determined and updated corporate planning for the Vonovia Group as a whole, and considers current business developments, possible opportunities and risks, and the potential impact of the coronavirus pandemic. This does not include effects resulting from the acquisition of Deutsche Wohnen. The forecast also includes the key overall macroeconomic developments and the economic factors that are relevant to the real estate industry and our corporate strategy. Further information is provided in the sections of the 2020 Group management report entitled “Fundamental Information About the Group” and “Development of the Economy and the Industry.”

Deutsche Wohnen was consolidated for the first time as of September 30, 2021, meaning that the opportunities and risks associated with the Deutsche Wohnen Group have also passed to Vonovia. As the business activities pursued by Deutsche Wohnen and Vonovia are fundamentally similar, no significant new risks are expected to arise as a result of the acquisition. Additional risks could potentially arise from the new Care segment and from the stake in Quarterback Immobilien AG, which will be responsible for large parts of Deutsche Wohnen’s project development business. The integration process will involve Vonovia assessing the opportunities and risks associated with Deutsche Wohnen in detail and incorporating them into Vonovia’s risk management system. At the time of first-time consolidation and based on the current assessment, there are no signs of any risks resulting from the acquisition of Deutsche Wohnen that could pose a threat to Vonovia’s survival or business development. Beyond this, the Group’s further development remains exposed to general opportunities and risks. These have also been described in the chapter on opportunities and risks in the 2020 Group management report. Additional risks could result from the upcoming amendments to the German Heating Costs Ordinance (Heizkostenverordnung) and the changes to the German Real Estate Transfer Tax Act (Grunderwerbsteuergesetz) effective July 1, 2021.

We expect that the coronavirus pandemic will not have a significant impact on the key operational and financial figures and therefore will have no impact on future business development. As a result, we no longer see any risk of a long-term lockdown either.

We expect segment revenue to increase further in 2021. We are also currently observing stable demand for rental apartments and no negative impact on market values as a result of the coronavirus pandemic.

Vonovia predicts that all operating segments will contribute to the increase in Adjusted EBITDA Total and Group FFO. The biggest absolute increases are expected to be seen in the Rental and Development segments.

In addition, we expect the value of our company to increase in 2021 and predict a moderate increase in EPRA NTA per share, leaving any further market-related changes in value out of the equation. Based on the first preliminary indicators, we expect to see an effect from the valuation of investment properties as well as capitalized modernization costs in the form of an increase in value of between € 1.8 billion and € 2.6 billion in total compared with September 30, 2021.

The current forecast yet again confirms the positive development in the Sustainability Performance Index (SPI). We expect the high level of customer satisfaction to continue. The reduction of carbon emissions is working better than expected.

The following table provides an overview of our forecast, excluding Deutsche Wohnen, and presents material and selected key figures.

Bochum, Germany, October 27, 2021

The Management Board