25 July 2024
Phoenix Spree Deutschland
Limited
(the "Company", the "Group" or "PSD")
New
Property Advisory and Investor Relations Agreement
The Board of PSD has agreed with
QSix Residential Limited ("QSix"), the Company's property advisor,
an amendment to the fees payable under the Property Advisor and
Investor Relations Agreement ("PAIR").
Background and rationale
On 5 June 2023, the Company
announced its intention to amend the fees payable to QSix, under
the previous PAIR.
The objective of the 2023 Proposal
(the "2023 Proposal") was to incentivise QSix to evaluate and
implement a variety of disposal strategies, including condominium
sales, while reducing the level of annual management fees paid by
introducing a fee cap.
Following a large majority vote in
favour of the 2023 Proposal at the Company's AGM on 28 June 2023,
the completion of the amended PAIR on 17 August 2023 formalised
these new arrangements.
Under the terms of the amended PAIR,
all ongoing fees payable to QSix for management, capital
expenditure monitoring and investor relations were capped at €5.0m
(the "Ongoing Fee Cap") starting from 1 July 2023 for a 12-month
period. This compared to €7.4m for the year ended 31 December 2022.
It was agreed that these revised terms would expire after 12 months
on 1 July 2024, and if no revised agreement was reached, the terms
would default to what they were previously.
Further reduction to Ongoing Fee
Cap
The Board today announces that it
has agreed an Amended and Restated Property Advisory and Investor
Relations Agreement ("New PAIR") with regard to fee arrangements
post July 2024 following discussions with the Property Advisor and
having consulted a number of the Company's largest shareholders.
The New PAIR represents an absolute reduction in fees with
the Ongoing Fee Cap reduced from €5.0m to €4.3 million. This
represents a 14% year-on-year reduction and a 40% reduction
compared to the run rate at the end of 2022. The Ongoing Fee Cap in
the New PAIR will now be permanent rather than time
limited.
Additionally, QSix has informed the
Company that it will use the post-tax proceeds of any future
disposal fees eligible from the Company under the terms of the New
PAIR to buy shares in PSD.
The Board believes these new
arrangements further align the interests of the Property Advisor
and the Company.
Given these new arrangements follow
the structure set out in the Proposal approved by Shareholders at
the last AGM and include a further reduction in the level of the
fees payable, the Board believes there is no need to ask
Shareholders to approve them.
Related party transaction
The New PAIR constitutes a related
party transaction to which the modified requirements for smaller
related party transactions in the Listing Rules apply, including
obtaining an independent fairness opinion on the financial terms
(which has been done).
For further information, please
contact:
Phoenix Spree Deutschland
Limited
+44 (0) 20 3937 8760
Stuart Young
Deutsche Numis (Corporate Broker)
+44 (0) 20 7260 1000
David Benda
Teneo (Financial PR)
+44
(0) 20 7353 4200
Elizabeth Snow
Annushka
Shivnani