WOBA offers city administration deferment of rent adjustments
3/16/2007
- Rent adjustments scheduled would be according to law
- Dresden city administration is requested to approve demolition proposals
- An analysis shows that rent increases have been lower after the sale of WOBA than in the years preceding the sale
At this time, WOBA DRESDEN is prepared to defer planned rent adjustments, permissible under the law, for residential units earmarked for demolition. For this to happen, the Dresden city administration needs to approve WOBA's proposal to implement the quota specified in the purchase agreement, namely the demolition of 3000 residential units.
- At the time of WOBA DRESDEN's sale, it was specified in the Dresden Social Charter that the demolition program must proceed "without abatement", "particularly in view of the sheer number of residential units to be demolished." However, as of today, no consent has been forthcoming from the Dresden city administration for the demolition proposals submitted by WOBA.
- Burkhard U. Drescher, CEO of the GAGFAH GROUP, emphasizes: "We are naturally keen to satisfy the conditions of the purchase agreement, but are dependent on the city's approval insofar as demolition is concerned. If the Dresden city administration were to approve the demolition proposals submitted by WOBA by September 1, 2007, we would not implement any rent adjustments for units earmarked for demolition."
- This proposal was presented today to members of the Housing Advisory Board in Dresden. The Housing Board is a body set up in the city council that oversees compliance with the Social Charter.
- The report placed before the Housing Board today shows that rent adjustments effectuated since the sale of WOBA DRESDEN were entirely in compliance with statutory provisions as also with the provisions of the Social Charter.In addition, the report's analysis shows that there have been smaller rent adjustments after WOBA DRESDEN's sale as compared to earlier. Before its sale, average rent adjustments did not cross16 percent, whereas rent adjustments after the sale have stayed within the upper limit of 3 per cent, plus the consumer price index, that is permissible for overall inventory under the Social Charter.
- Burkhard U. Drescher, clarifies: "We take our social responsibility towards our lessees very seriously. For this reason, we have not yet taken advantage of the full scope for rent adjustment permitted under the Social Charter. In 2007, we raised rents by only 0.93 percent across our inventory, whereas over 4 percent on the upside would have been permissible.
- About GAGFAH S.A. and the GAGFAH GROUP
GAGFAH S.A. is a stock corporation (société anonyme) domiciled in Luxembourg. GAGFAH's key business areas are the ownership, management, and acquisition of a geographically diversified, high-quality residential property portfolio throughout Germany. The most significant subsidiaries of GAGFAH S.A. are GAGFAH GmbH, NILEG, and WOBA DRESDEN. With a portfolio of over 168,000 rental apartments located throughout Germany, GAGFAH is Germany's largest listed residential property company. GAGFAH generates 95% of its income from the rental of attractive residential accommodation and strives to continually improve its services. GAGFAH lives up to its social responsibility, for example through special tenant protection rights and its "Mensch und Wohnen" foundation.