Marcus Phayre-Mudge, manager of TR Property Investment Trust (TRY), explains why he invests in Phoenix Spree Deutschland (PSDL).
"Phoenix Spree Deutschland is a UK-listed specialist owner of prime apartments in Berlin and, like most listed real estate, has been a victim of investor panic about the rising cost of debt. Yet we continue to like this company due to its index-linked rents, strong tenant demand and because, unlike its German residential cousins, it has few refinancing requirements until 2026.
"Most private rents in Germany are pegged to a regularly reviewed ‘mietspiegel’ – rent index – based on similar local dwellings. The result is sustainable income for landlords and manageable outgoings for tenants. The mietspiegel is also a reason why Berlin is the most affordable capital in Europe. A Londoner would need to move to Uxbridge or Croydon to compete with prime central Berlin on a rent-per-square-foot basis.