Business
New Property Advisory Investor Relations Agreement
New Property Advisory Investor Relations Agreement.
About this update from Phoenix Spree Deutschland Ltd
[{"type":"text","content":"\n\n25 July 2024\nPhoenix Spree Deutschland Limited \n(the \"Company\", the \"Group\" or \"PSD\")\n \n \nNew Property Advisory and Investor Relations Agreement\nThe 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\").\nBackground and rationale\nOn 5 June 2023, the Company announced its intention to amend the fees payable to QSix, under the previous PAIR.\nThe 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.\nFollowing 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.\nUnder 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.\nFurther reduction to Ongoing Fee Cap\nThe 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.\nAdditionally, 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.\nThe Board believes these new arrangements further al...