29 Financial Assets Accounted for Using the Equity Method

As of the reporting date, Vonovia held interests in 17 joint ventures and 14 associates (December 31, 2023: 17 joint ventures and eleven associates).

Gropyus AG

The shares in Gropyus AG have been reclassified to financial assets accounted for using the equity method. This reclassification is also due to the fact that the shares have increased from 18.9% to 20.5% and to the fact that Daniel Riedl was elected Chairman of the Supervisory Board of Gropyus AG at the Supervisory Board meeting held on April 26, 2024. The shares were remeasured in accordance with IFRS 9 prior to reclassification. The change in fair value was reported without affecting net income. As a result, the non-current equity investment was classified as of June 30, 2024, as a financial asset accounted for using the equity method at its carrying amount of € 82.7 million.

Share purchases and participation in a capital increase in the third quarter of 2024 mean that the stake in Gropyus AG has increased from 20.5% to 23.9%.  

The at-equity adjustment of the investment in Gropyus AG has resulted in a positive result of € 1.1 million since Gropyus inclusion as a company accounted for using the equity method (2023: € - million). An ad hoc impairment test was performed on the interest in Gropyus AG as of December 31, 2024. No need for impairment arose.

The table below shows financial information for Gropyus AG as of December 31, 2024.

Mosaik Funds

In August 2024, Vonovia sold eleven development projects for € 489.0 million to a fund launched by HIH Invest, Projekt Mosaik GmbH & Co. KG. A transfer of six properties with a purchase price of € 302.2 million had been made by December 31, 2024. Further QUARTERBACK Immobilien AG project developments were also sold to the fund for € 141.7 million. The transfer of properties worth € 28.0 million had already been completed by December 31, 2024.

In October 2024, Vonovia sold a further ten additional development projects for around € 515.9 million to another fund launched by HIH Invest, Projekt Mosaik II GmbH & Co. KG. Properties worth € 69.6 million had been transferred by December 31, 2024 within this context.

Vonovia has a 49.2% stake in both funds. Interim profits from the disposal of real estate inventories in the amount of € 4.2 million were deducted from the consolidated results as part of the sale.

In the 2024 fiscal year, the funds contributed € 0.0 million to Vonovia’s consolidated results.

The table below provides financial information for Projekt Mosaik GmbH & Co. KG and Projekt Mosaik II GmbH & Co. KG:

QUARTERBACK Group

Vonovia also holds 40% of the non-listed QUARTERBACK Immobilien AG whose registered office is situated in Leipzig. QUARTERBACK Immobilien AG is a project developer with operations throughout Germany focusing on the central German region.

On July 6, 2024, the new energies business area previously managed within QUARTERBACK Immobilien AG was sold to the sister company QUARTERBACK New Energy Holding GmbH and removed from the group structure. In the future, the company will operate under the name QUARTERBACK New Energy Holding GmbH as an independent sister company of QUARTERBACK Immobilien AG.

Prior to this transaction, Vonovia had purchased 40% of the shares in QUARTERBACK New Energy Holding GmbH. which has its registered office in Leipzig, via its wholly-owned subsidiary Larry II Targetco GmbH, Berlin. This means that the stake in QUARTERBACK New Energy Holding GmbH matches that in QUARTERBACK Immobilien AG.

The value for the initial recognition of the stake in QUARTERBACK New Energy Holding GmbH is € 0.1 million. As part of the agreed shareholder loan for up to € 100.0 million, € 90.0 million had been paid out by December 31, 2024 and a further € 4.0 million was paid into the company as a capital contribution.

An expected credit loss of € 45.0 million was recognized as part of a review of the recoverability of the loan.

Vonovia also holds interests in eleven (December 31, 2023: eleven) non-listed financial investments of QUARTERBACK Immobilien AG, with equity interests of between 44% and 50% (QUARTERBACK property companies), that were classified as joint ventures.  

The 40% interest in the non-listed QUARTERBACK Immobilien AG and in the eleven non-listed financial investments of QUARTERBACK Immobilien AG and QUARTERBACK New Energy Holding was adjusted on the basis of the financial information as of December 31, 2024, that was available on the preparation cut-off date.

The at-equity adjustment of the investments in the Quarterback Group described above produces a negative result of € -49.3 million as of December 31, 2024 (2023: € -73.2 million). The part of the loss for the reporting period that was not recognized comes to € 47.3 million (2023: € - million).

In the 2024 fiscal year, Vonovia concluded purchase agreements to acquire land to build on from the QUARTERBACK Immobilien Group. Within the same context, selective purchase agreements were also concluded to acquire property management units from QUARTERBACK Immobilien AG. The total volume of the purchase agreements concluded in 2024 comes to around € 1.3 billion. The transactions are scheduled to be closed in the first half of 2025.

Further transactions in order to acquire land to build on from the QUARTERBACK property companies are planned for the first half 2025. The total volume of the other planned purchase agreements comes to around € 0.2 billion.

The loan receivables from the QUARTERBACK Immobilien Group and the QUARTERBACK property companies included in the financial assets have been offset against the outstanding purchase price components within the scope of these transactions.

Vonovia assumes that the outstanding receivables from the QUARTERBACK Immobilien Group following the closing of the transactions will not be recoverable. As a result, it has recognized a corresponding cumulative impairment loss of € 296.8 million on these receivables, with € 276.7 million recognized in the 2024 fiscal year.

Interest income collected in the 2024 fiscal year was also written off in full. The impairment loss recognized for this interest income is shown netted against the interest income.

Vonovia also assumes that receivables from the QUARTERBACK property companies will not be recoverable. As a result, it recognized a corresponding impairment loss of € 43.2 million on these receivables in the 2024 fiscal year.

The additional impairment loss recognized for loan receivables is shown in the line item “Impairment losses on financial assets” in the consolidated income statement.

Other investments accounted for using the equity method

In addition to these investments, Vonovia also holds interests in 15 (December 31, 2023: 16) other entities that are accounted for using the equity method and are currently of minor importance; quoted market prices are not available.

The interests were adjusted for these entities provided that corresponding financial information was available.

The following table shows, in aggregated form, the carrying amount and the share of profit and other comprehensive income of these companies:

With regard to the other 15 entities, Vonovia has no significant financial obligations or guarantees with respect to joint ventures and associates.