IMMOFINANZ further expanded its strong position in the residential sector with the full takeover of ESG. Synergies with BUWOG and high potential for an increase in value provide excellent opportunities for solid returns.

After an initial investment that was acquired during the privatisation of the four major federal cooperative property companies in 2004, IMMOFINANZ purchased the remaining shares in ESG, an Austrian residential property company, during autumn 2005. The ESG portfolio is comprised mainly of objects in the provinces of Carynthia and Styria.

ESG owns roughly 12,800 apartments in 670 buildings with a total of 1.1 million sqm in letable space. These two former federal property companies, BUWOG and ESG, also represent an ideal match from a geographical standpoint: most of the BUWOG apartments are located in the province of Upper Austria, while ESG covers the southern part of the country.

In order to realise synergies as quickly as possible, the first measures to establish close cooperation between ESG and BUWOG have already been implemented. These companies now share a common management, which is headed by IMMOFINANZ officer Daniel Riedl, Gerhard Schuster and Robert Puhr. Additional synergies in the areas of IT, facility management and central infrastructure will also be developed in the future.

The steps taken over the past two years to optimise earnings at BUWOG have been highly successful, and have made this company one of the most profitable IMMOFINANZ subsidiaries. The sale of vacated apartments in buildings that have received municipal approval for conversion to condominiums totals roughly 200 each year – and has generated interesting gains for BUWOG.

BUWOG has recorded a series of notable successes in its business operations. Most of the portfolio objects are almost fully rented, and the demand for new apartments is excellent. As an example, these two properties were completely rented or sold from the start: the Lascygasse in Vienna’s 17th District, which was constructed in 2005/06, and the Wienerstrasse complex directly adjoining the Hoffmann-Sanatorium Purkersdorf, which is also part of the BUWOG portfolio. BUWOG also won the building developer competitions for the Marktgasse project (condominiums in the 9th District of Vienna) and the Heustadelgasse project (rentals in the 22nd District of Vienna). Over the coming years BUWOG plans to increase its focus on quality. This will include the expansion of activities in the area of freely financed objects with the BUWOG Exclusive (apartments) and terraced house product lines.

BUWOG – BAUEN UND WOHNEN
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