Economic Development in the First Half-Year of 2025
Key Events During the Reporting Period
In the first half of 2025, US trade and tariff policies led to significant reactions on the global capital markets. Many economists believe there is a risk of a prolonged recession if the tariff conflicts continue to escalate.
Vonovia’s business model is not affected directly by protectionist measures. Nevertheless, the Group’s economic development is heavily reliant on other economic parameters, such as interest rate and inflation trends, which are more volatile as a result of the tariff measures. At present, however, it is impossible to either predict or quantify what the specific developments might look like.
Our core business remains characterized by a high level of demand for rental apartments and a positive rent trend. With a vacancy rate of 2.1 % at the end of the first half of 2025 (end of the first half of 2024: 2.2 %), Vonovia’s residential real estate portfolio was virtually fully occupied.
Real estate transaction volumes were up in the first six months of 2025, with a slight increase in property values. The slight cut in the ECB key rate in June 2025 is likely to favor future transactions, particularly in the Recurring Sales and Development segments.
The Customer Satisfaction Index (CSI) was 1.2 percentage points above the value of the previous quarter as of June 30, 2025. Looking at the average for the year to date, customer satisfaction is up by 1.4 percentage points on the average for 2024.
On September 18, 2024, Vonovia SE and Deutsche Wohnen SE initiated a process to conclude a control and profit and loss transfer agreement between the two companies. This process will involve Vonovia making an offer to external shareholders of Deutsche Wohnen SE to acquire their shares in return for compensation in the form of newly issued shares in Vonovia SE, or to grant the remaining shareholders of Deutsche Wohnen SE an annual compensation payment for the term of the intercompany agreement.
The extraordinary general meetings of Vonovia SE and Deutsche Wohnen SE on January 24 and 23, 2025, approved the control and profit-transfer agreement between Vonovia SE and Deutsche Wohnen SE dated December 15, 2024. The control and profit and loss transfer agreement takes effect upon entry into the commercial register of Deutsche Wohnen SE. This entry has not yet been made. On June 30, 2025, a court settlement pursuant to Section 278 (6) of the German Code of Civil Procedure (ZPO) was reached with all of the parties involved in the action for annulment brought against the resolution passed by the extraordinary general meeting of Vonovia SE regarding the approval of the conclusion of the control and profit-transfer agreement, the creation of the 2025 conditional capital and the corresponding amendment of the Articles of Association to include an Article 6a, ending the action for annulment by court order. When the control and profit and loss transfer agreement takes effect upon entry into the commercial register, Deutsche Wohnen SE will transfer its total annual profit to Vonovia SE or Vonovia SE will cover any losses incurred by Deutsche Wohnen SE. The obligation to transfer profits and losses will apply for the first time for the fiscal year ongoing at the time the control and profit and loss transfer agreement is entered into the commercial register of Deutsche Wohnen SE.
On September 30, 2024, Vonovia and Apollo agreed to establish a company that is to hold 20% of the shares in Deutsche Wohnen SE. Vonovia will hold a 49% stake in that company, while long-term investors advised by Apollo will collectively hold 51%. Vonovia’s cash inflow from this transaction will amount to just over € 1 billion. The transaction was concluded on July 29, 2025.
Ownership of 19 nursing care properties and the “Katharinenhof” nursing care businesses was transferred in the first quarter of 2025. The purchase agreement concluded on October 2, 2024, involves the sale of a total of 27 nursing care properties and the Katharinenhof nursing care businesses. Ownership of a further two nursing care properties was transferred in the second quarter of 2025.
On January 17, 2025, Vonovia signed a notarized contract for the sale of PFLEGEN & WOHNEN HAMBURG GmbH (P&W), including the associated properties, to the City of Hamburg. The sale comprises 13 nursing homes in Hamburg with around 2,000 employees and around 2,400 nursing places. The homes are being sold to HGV Hamburger Gesellschaft für Vermögens- und Beteiligungsmanagement (HGV), the group holding company belonging to the city’s tax authority, in which the majority of the City of Hamburg’s companies under private law are consolidated. The purchase price is € 380.0 million.
A notarized sales contract for a portfolio in Berlin was successfully concluded on April 23, 2024. The transaction executed with two state-owned Berlin housing construction companies saw around 4,500 residential units with a value of around € 700 million being sold as part of a share deal. The transaction was closed with the transfer of beneficial ownership on January 1, 2025.
In the first half of 2025, 820 apartments and 261 commercial units from the QUARTERBACK Immobilien Group, accounting for a volume of around € 0.3 billion, were transferred to Vonovia’s portfolio. The acquisition of land to build on with a volume of around € 0.9 billion was also completed within the first half of 2025. The impairment test performed on the reporting date of June 30, 2025, resulted in impairment losses of around € 0.3 billion being recognized for the land to build on that has been transferred. A provision of around € 80 million has been set up for land that has not yet been transferred, and will reduce the amount recognized at the time of transfer of ownership.
The Supervisory Board of Vonovia SE decided unanimously on May 6, 2025, to appoint Luka Mucic as Vonovia’s new CEO. Rolf Buch will be handing over the reins as CEO at the end of the year. He will remain responsible as CEO until then and will oversee the onboarding of Luka Mucic in his new role.
The Annual General Meeting held on May 28, 2025, resolved to pay a dividend for the 2024 fiscal year in the amount of € 1.22 per share. As in previous years, shareholders were offered the option of choosing between being paid the dividend in cash or being granted new shares. During the subscription period, shareholders holding a total of 35.53% of the shares carrying dividend rights opted for the scrip dividend instead of the cash dividend. As a result, 12,768,562 new shares were issued using the company’s authorized capital for a total of € 356,728,085.14. The total amount of the dividend distributed in cash therefore came to € 647,152,483.36.
Two new Supervisory Board members were also elected by the Annual General Meeting: Michael Rüdiger and Dr. Marcus Schenck. They will replace Dr. Ute Geipel-Faber and Hildegard Müller, whose mandates ended as scheduled at the end of the Annual General Meeting.
On May 13, 2025, Vonovia placed two new convertible bonds with a total volume of € 1.3 billion. The first bond in the amount of € 650.0 million will mature in May 2030 and does not bear any periodic interest. The second bond – also with a volume of € 650.0 million – will fall due in May 2032 and has a coupon rate of 0.875% p.a. The bonds can either be converted into shares in Vonovia or settled in cash. The bond terms and conditions are such that the convertible bonds are treated as borrowed capital in full. For accounting purposes, the conversion rights are separated, as a derivative component, from the debt transaction and are measured and reported separately as a derivative within financial liabilities. Upon initial recognition not affecting net income, the value of the derivative came to € 143.7 million. The value came to € 165.3 million as of June 30, 2025. The change in value in the period since initial recognition was recognized affecting net income in the amount of € 21.6 million in other interest result from derivatives.
The partial buyback of bonds with a total volume of € 800 million was completed on June 6, 2025. This involved buying back a social bond with an issue volume of € 750.0 million and a term expiring in 2027 in the amount of € 435.7 million (selling price € 454.3 million). This bond has a 4.75% coupon rate. A further bond, a green bond, with an issue volume of € 750.0 million and a term expiring in 2030 was bought back in the amount of € 364.3 million (selling price € 399.5 million). This bond has a 5.00% coupon rate.