Germany-focused landlord Phoenix Spree Deutschland (PSDL) has announced plans to raise up to £38m by way of a firm placing of new shares and an offer for subscription. The proposal, which is subject to shareholder approval, also includes plans to implement a placing programme for up to 120m new shares from 7 March 2016 to 8 February 2017.
The offer is likely to attract significant institutional demand, and Phoenix is confident enough to set the offer price at a small premium to the current share price. And expenses from further placings will be met by setting a similar premium.
The advantage of the placing programme is that it cuts down the time needed to go through a fresh placing programme, and will allow the property adviser to act in a more opportunistic way. Five acquisitions costing £39m are due for completion by the end of March and, crucially, at £5.50 per square metre, rents are around 27 per cent below current market rates.