Share Name Share Symbol Market Type Share ISIN Share Description
Phoenix Spree Deutschland Limited LSE:PSDL London Ordinary Share JE00B248KJ21 SHS NPV
  Price Change % Change Share Price Bid Price Offer Price High Price Low Price Open Price Shares Traded Last Trade
  +0.00p +0.00% 311.00p 311.00p 313.00p 313.00p 311.00p 313.00p 36,417 16:29:56
Industry Sector Turnover (m) Profit (m) EPS - Basic PE Ratio Market Cap (m)
Equity Investment Instruments 20.4 50.7 41.4 7.8 313

Phoenix Spree Deutschland Limited PSDL Final Results

29/04/2019 7:01am

UK Regulatory (RNS & others)


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Phoenix Spree Deutschland Limited

29 April 2019

Phoenix Spree Deutschland Limited

("Phoenix Spree", or the "Company")

FINANCIAL RESULTS FOR YEARED 31 DECEMBER 2018

STRONG PORTFOLIO PERFORMANCE AND FURTHER GROWTH IN BERLIN

Phoenix Spree Deutschland (LSE: PSDL.LN), the UK listed real estate company specialising in Berlin residential property, today announces its full year results for the year ended 31 December 2018.

Robert Hingley, Chairman of Phoenix Spree, commented:

"I am delighted to report that, following an exceptionally strong year in 2017, we have continued this momentum, delivering further increases in rental growth and portfolio value. This performance reflects the active management of our portfolio as well as the continued positive dynamics that characterise the Berlin residential market, where we are now fully focused following the disposal of our Northern German portfolio. Although Berlin residential yield compression has moderated, following a long period of declining property yields, we see significant opportunity to grow the portfolio value through a combination of investment into our existing properties and the acquisition of assets that meet our strict acquisition criteria. We are confident that we will continue to deliver value to shareholders through further rental growth, condominium sales and densification within the existing portfolio."

Financial highlights: increases in rental growth, property values and EPRA NAV

   --      IFRS NAV per share up 2.3% to EUR4.05 (GBP3.64) (31 December 2017: EUR3.96 (GBP3.52). 
   --      EPRA NAV per share up 11.4% to EUR4.58 (GBP4.11) (31 December 2017: EUR4.11 (GBP3.65). 
   --      Strong like-for-like rental income growth per sqm of 9.0% during the year. 

o Contracted net rental income of EUR17.5 million, (31 December 2017 EUR18.1 million), reflecting the sale of the Northern German portfolio in April 2018.

o Gross rental income including service charges of EUR22.7 million (EUR23.7 million in 2017).

   --      EPRA total return per share of 13.2% (year to 31 December 2017: 53.0%). 

-- Profit before tax EUR56.4 million (year to 31 December 2017: EUR138.5 million); year-on-year change reflects lower revaluation increase in 2018 after exceptionally strong gains in 2017.

   --      Earnings per share EUR0.46 (31 December 2017: EUR1.21). 
   --      Net loan to value of 26.1% as at 31 December 2018 (31 December 2017: 32.0%). 

-- New debt of EUR28.8 million signed during 2018. Average debt maturity of 7.7 years, average interest rate reduced to 2.0%.

-- Final dividend per share of EUR5.15 cents (GBP:4.62p), giving a total dividend per share of EUR7.50 cents (GBP:6.73p) for year to 31 December 2018 (2017: EUR7.3 cents (GBP: 6.4p)).

Operational highlights: Strong portfolio performance

   --      Like-for-like Portfolio valuation increase of 14.0% in year to 31 December 2018. 

o Total Portfolio valued at EUR645.7 million, an increase of 6.0% in absolute terms over the twelve-month period (31 December 2017: EUR609.3 million), reflecting the impact of non-Berlin disposals during year.

o Berlin portfolio valued at EUR641.8 million, an increase of 21.4% year-on-year (31 December 2017: EUR528.5 million).

o Portfolio valuation represents an average value per square metre of EUR3,527 (31 December 2017: EUR2,853).

   --      EPRA Vacancy remains low at 2.8% (31 December 2017 2.9%). 

-- Condominium sale completion proceeds up 4.4%, to EUR9.9 million, achieving an average value per sqm of EUR4,566.

-- Continued active management of the Berlin portfolio with record investment of EUR7.9 million in renovations and modernisations during 2018.

-- New leases on average signed at a 39.7% premium to passing rents and condominium sales completed at a 27.8% premium to the average valuation of Berlin rental properties as at 31 December 2018.

Berlin transition complete: further progress on Berlin acquisitions

-- Contracts to acquire 222 units notarised during 2018, representing an aggregate purchase price of EUR36.3 million and an average value per sqm of EUR2,390.

-- As at 23 April 2019, contracts to acquire a further 14 units in Berlin have been notarised since the December 2018 year end for a purchase price of EUR2.4 million, representing a price per sqm of EUR2,956.

-- Disposal of Central and Northern Germany portfolio completed in April 2018 for EUR73.0 million, a 26% premium to the Jones Lang LaSalle valuation pre-notarisation.

-- Since 31 December 2018, all residual non-Berlin assets have been sold, creating a fully-focussed Berlin fund with potential for greater economies of scale.

Positive outlook: Significant embedded value remains within rental Portfolio

-- Berlin residential property prices continue to benefit from lack of supply and favourable demographics, driven by strong job creation and population growth.

   --      Significant reversionary potential underpins future rental growth. 
   --      Potential for further valuation creation through condominium projects and sales. 

-- Further Berlin acquisitions expected in current financial year. Acquisition prices remain below construction values.

-- Substantive review of financing structure in progress. Expected to create further capacity for Portfolio development.

-- Active consideration of densification projects, including attic conversions and new building construction on land surrounding buildings already owned by the Company.

For further information, please contact:

 
Phoenix Spree Deutschland Limited 
 Stuart Young                                 +44 (0)20 3937 8760 
Numis Securities Limited (Corporate Broker) 
 David Benda                                  +44 (0)20 3100 2222 
Tulchan Communications (Financial PR) 
 Elizabeth Snow 
 Amber Ahluwalia                              +44 (0)20 7353 4200 
 

CHAIRMAN'S STATEMENT

I am delighted that the Company has continued its growth over the last twelve months, delivering further increases in rental revenues, property values and EPRA NAV after an exceptionally strong set of results in 2017. This performance is underpinned by the continued favourable Berlin residential rental market dynamics. After a long period of rapid property price inflation, yield compression has moderated, although the strong underlying demographic trends remain in place. The Berlin residential market is still characterised by a significant undersupply of available rental property, as well as positive demographic and employment trends.

Berlin transition complete: geographically focussed portfolio

When Phoenix Spree listed on the main market of the London Stock Exchange in June 2015, 53.5% of the properties in the Portfolio were located outside of Berlin. Notwithstanding the solid financial performance of these assets, the Board considered that the Berlin residential market offered superior medium-term scope for further growth in rental and property values. The Company therefore successfully repositioned its geographic focus by divesting properties outside Berlin through a disciplined disposal process, all at a premium to trailing book value.

All remaining non-Berlin assets have been successfully divested following the sale of the Company's remaining Northern Germany assets in the second quarter of 2018 and one residual asset in Baden-Wurttemberg in early 2019. We have simultaneously enlarged our Berlin presence through our strategy of further acquisitions of attractive assets in central Berlin, enhancing the scope for further asset management efficiencies and economies of scale.

Acquiring for growth

Phoenix Spree has continued to add to the Portfolio in 2018 and has completed a further EUR41.6 million of acquisitions in central Berlin. The Company has a proven record of creating value for shareholders through property acquisitions, having acquired buildings with a combined initial value of EUR204.1 million from 2015 up to 31 December 2018, while maintaining its disciplined approach.

We are well placed to continue to grow the portfolio and we continue to research attractive acquisition opportunities.

Improving our tenanted accommodation

Some properties acquired can be in a poor state of repair, depending on the level of historical underinvestment by previous owners. The Company takes its responsibilities to its tenants extremely seriously and we have continued to invest in improvements to our properties.

Through a carefully targeted process of investment, we have raised the overall standard of accommodation for our tenants and the environment in areas where our buildings are located. During 2018, the Company invested the highest value yet on improvement programmes, and it is anticipated that this process will continue into 2019.

This improvement in the overall quality of our living accommodation has created significant future embedded value within the Berlin Portfolio, as evidenced by new leases signed at a premium to in-place rents and condominium sales completed at a premium to average rental property valuations.

Partnering with our Property Advisor

Since our introduction to the Stock Exchange in 2015, the Company has benefitted significantly from the expertise of its property advisor, PMM Partners (UK) Limited. It has actively managed and developed the Portfolio, whilst simultaneously sourcing value-enhancing acquisitions, and achieving disposals at a premium to book value. PMM Partners has also overseen the capital structure of the Company as well as its day-to-day interaction with investors and other key stakeholders in our business. These activities have been fundamental to the strong financial performance of Phoenix Spree and its ability to access capital markets.

I am therefore delighted that, following overwhelming shareholder approval at an Extraordinary General Meeting in December 2018, the Company entered into a new property advisory and investor relations agreement with PMM Residential Limited (PMM), a new company within the PMM Group, which will secure its continued expertise as property advisor until at least the end of 2022.

The new agreement will provide greater certainty and stability for shareholders and allow PMM to invest in infrastructure, IT systems and key personnel dedicated to servicing the Company's growing requirements. It will also reduce future management and performance fees paid by the Company and will, therefore, result in significant cost savings compared with the terms of the old property advisor agreement. The Board looks forward to building on our valued relationship with PMM over the coming years to continue our record of strong performance.

In February 2019, the Company announced it had been informed that PMM Partners (UK) Limited and its principals had sold a total of 2,239,361 shares in the Company. The sale of these shares was principally made to satisfy the tax liabilities arising from the December 2017 performance fee which was settled in Phoenix Spree Deutschland (PSD) shares issued to PMM Partners (UK) Limited in May 2018.

Share price and dividend

The 2018 financial year proved difficult for global equity markets in general, as concerns about global growth, the increasing trend towards trade protectionism and Brexit weighed heavily. Against this backdrop, 2018 was a year of consolidation for the Phoenix Spree share price. Notwithstanding this, the shares outperformed the FTSE All-Share index by 5% and the FTSE 350 Real Estate Investment Services sector by 12%.

The Board is pleased to recommend a final dividend of EUR5.15 cents per share (GBP 4.62 pence per share), taking the full year dividend to EUR7.50 cents per share (GBP 6.73 pence per share), representing a 3% increase on the 2017 full year Euro-denominated dividend.

Our Better Futures" Corporate Responsibility Plan

The Board recognises the importance of operating with integrity, transparency and clear accountability towards its shareholders, tenants and other key stakeholders. We understand that being a responsible Company, balancing the different interests of our stakeholders and addressing our environmental and social impacts is intrinsically linked to the success and sustainability of our business.

During the past year, the Board and PMM have reviewed how sustainability is managed within our business and considered carefully the views of our stakeholders and business priorities to create our 'Better Futures' Corporate Responsibility ('CR') Plan. This Plan provides a framework to monitor existing activities better, while adding new initiatives to improve our overall sustainability.

Our Corporate Responsibility Plan has four key pillars that have been integrated throughout our business operations: Protecting our Environment; Respecting People; Valuing our Customers and Investing in our Communities. We have established a CR Committee to oversee the implementation of the Better Futures Plan, reporting to the Board and advising on any CR related material issues. Our CR initiatives will be reported in more detail in our 2018 Annual Report and are available on the Company website.

The Board remains fully committed to high standards of corporate governance. It has considered the Main Principles and Provisions of the UK Corporate Governance Code (July 2018) and is pleased to confirm that the Company has complied with the provisions of the Code throughout the year, except in certain instances which are set out in the Corporate Governance Statement within this announcement.

Outlook

In recent years, Berlin property values have benefited from significant yield compression. Although this has moderated, the outlook for the Berlin residential market remains positive. Residential prices remain on average below the cost of construction and demand for property continues to grow, due to the continuing process of urbanisation and population growth. Berlin average monthly rents per square metre remain among the lowest of all major European cities.

The Board believes there is scope for further market rental growth as well as the opportunity to improve rental incomes through our Property Advisor's active asset management strategies, particularly on recently acquired buildings. The reversionary potential that our substantial investment in the Portfolio to date has created should provide a cushion in the event of any market slowdown.

The Board remains confident that the Company will continue to generate growth in rental income and property values during 2019 supported by selected additions to the portfolio and further condominium projects. This, in turn, should deliver further capital growth and dividend income to investors in the current financial year.

REPORT OF THE PROPERTY ADVISOR

Portfolio Regional Overview as at 31 December 2018

 
                               Berlin            Baden-Wurttemberg   Total 
                                (incl. Greater 
                                Area) 
 % of fund by value            99.4              0.6                 100 
                              ----------------  ------------------  ------ 
 Number of buildings           95                1                   96 
                              ----------------  ------------------  ------ 
 Number of residential 
  units                        2,374             18                  2,392 
                              ----------------  ------------------  ------ 
 Number of commercial 
  units                        142               11                  153 
                              ----------------  ------------------  ------ 
 Total units                   2,516             29                  2,545 
                              ----------------  ------------------  ------ 
 Total sqm ('000)              179.4             3.7                 183.1 
                              ----------------  ------------------  ------ 
 Annualised Net Rent (EURm)    17.6              0.4                 18.0 
                              ----------------  ------------------  ------ 
 Valuation (EURm)              641.8             3.9                 645.7 
                              ----------------  ------------------  ------ 
 Value per sqm (EUR)           3,576             1,084               3,527 
                              ----------------  ------------------  ------ 
 Fully occupied gross 
  yield %                      2.9               12.1                3.0 
                              ----------------  ------------------  ------ 
 Vacancy %                     4.7               7.7                 4.8 
                              ----------------  ------------------  ------ 
 EPRA Vacancy %                2.9               0.0                 2.8 
                              ----------------  ------------------  ------ 
 

Like-for-like Portfolio value rises by 14%

On a like-for-like basis, excluding the net impact of acquisitions and disposals, the Portfolio valuation increased by 14.0% during the year ended 31 December 2018 as it continued to benefit from the strong market fundamentals in Berlin.

The total Portfolio was valued at EUR645.7 million by Jones Lang LaSalle GmbH, the Company's external valuers, an absolute increase of 6.0% over the twelve-month period (31 December 2017: EUR609.3 million), reflecting the impact of non-Berlin disposals during year. The Portfolio valuation represents an increased average value per square metre of EUR3,527 (31 December 2017: EUR2,853) and a gross fully occupied rental yield of 3.0% (31 December 2017: 3.4%).

The Berlin portfolio was valued at EUR641.8 million, an increase of 21.4% year-on-year (31 December 2017: EUR528.5 million). This represents an increased average value per square metre of EUR3,576 (31 December 2017: EUR3,220).

The principal drivers behind the like-for-like growth in the Portfolio value were:

   --      a further contraction in market yields, driven by the low interest rate environment; 
   --      strong growth in like-for-like rental income within the Portfolio; 
   --      the positive impact of the Property Advisor's active asset management strategy; 
   --      continued high levels of investor interest in the Berlin property market; and 

-- further development of the condominium market, with single apartment prices in Berlin experiencing another year of double-digit growth.

Rental income - growth trend continues

Contracted net rental income (excluding service charge revenue) declined by 3.2% to EUR17.5m (31 December 2017 EUR18.1m), reflecting the impact of disposal of remaining non-Berlin assets during the financial year. On a like-for-like basis, excluding the effect of acquisitions and disposals, rental income across the Portfolio grew by 9% compared with the prior year. Headline average in-place rent per sqm was EUR8.6 as at 31 December 2018, compared with EUR8.1 as at 31 December 2017.

Berlin saw a like-for-like increase in rent per sqm of 6.9%. Average rent per sqm was EUR8.5, a year-on-year increase of 5.1% compared with 2017, reflecting strong underlying rental growth in the existing portfolio, partially offset by the impact of recent acquisitions, which typically have lower rental values upon takeover.

As at 31 December 2018 the Company's net contracted annualised rental income was EUR18.0 million.

Recent letting prices achieve new highs for the Company

The Company enjoyed another strong letting performance in 2018. A total of 284 new leases were signed, representing 12.0% of the average units owned during the period. In the Berlin portfolio, average new letting prices were 5.3% to EUR11.9 per sqm (2017: EUR11.3 per sqm).

Portfolio reversionary rental potential remains high

Notwithstanding the growth in rental prices, the Portfolio continues to demonstrate significant reversionary potential, as shown by the premiums achieved on new letting prices when compared to in-place rents. New leases signed during the period in Berlin were agreed, on average, at a 40.4% premium to passing rents.

The Property Advisor believes this reversionary gap should underpin rental growth in the medium term, providing a buffer against any potential slow-down in the rental market.

EPRA vacancy remains low

Reported vacancy as at 31 December 2018 was 4.4%, down from 6.8% as at 31 December 2017. On an EPRA basis, which adjusts for units undergoing redevelopment or reserved for resale, vacancy was 2.8% as at 31 December 2018, compared with 2.9% as at 31 December 2017.

The Berlin EPRA vacancy rate also remained low at 2.9% (31 December 2017: 2.7%), with the modest increase reflecting a higher vacancy rate on buildings acquired during the year. The higher vacancy rate allows the Company to redevelop and re-let recently acquired apartments.

Portfolio investment reaches new high

The Company remains committed to improving living standards for its tenants and fulfilling its environmental obligations in areas where its properties are located. Depending on the level of historical underinvestment by previous owners, apartment improvements can involve redecoration, heating system and heating plant renewal, new insulation, double glazing, plumbing and flooring, as well as kitchen and bathroom renewal. Communal areas, both indoor and outdoor, are also reviewed for potential improvement where investment has previously been lacking. During 2018, the Company invested EUR7.9m, its highest sum to date, to further improve the overall quality of its accommodation and surroundings (year to 31 December 2017: EUR6.7 million).

In the Berlin rental portfolio, EUR4.5 million was invested in the refurbishment of 189 units representing an average outlay of EUR354.6 per sqm. The average premium achieved on re-letting these vacant Berlin units was 68.9%. A further EUR1.9 million was invested in the infrastructure of properties within the Portfolio for items such as heating system upgrades and improvements to indoor and outdoor communal areas. An additional EUR1.5 million was invested on the development of condominium projects. All these items are recorded in the accounts as capital expenditure.

A further EUR1.7 million was spent on repairs and maintenance and expensed through the profit and loss account, compared to EUR1.4 million in 2017. This results in a total renovation and repair investment of EUR9.6 million.

Financial Results

 
 EUR million (unless otherwise stated)    31 Dec 2018   31 Dec 2017 
 Gross rental income (including 
  service charges)                        22.7          23.7 
                                         ------------  ------------ 
 Like-for-Like annualised rental 
  income                                  16.6          15.2 
                                         ------------  ------------ 
 Net contracted rental income             17.5          18.1 
                                         ------------  ------------ 
 Profit before tax (PBT)                  56.4          138.5 
                                         ------------  ------------ 
 Reported EPS (EUR)                       0.46          1.21 
                                         ------------  ------------ 
 Investment property value                645.7         609.3 
                                         ------------  ------------ 
 Net debt                                 168.4         195.1 
                                         ------------  ------------ 
 Net LTV                                  26.1%         32.0% 
                                         ------------  ------------ 
 EPRA NAV per share (EUR)                  4.58         4.11 
                                         ------------  ------------ 
 EPRA NAV per share (GBP)                 4.11          3.65 
                                         ------------  ------------ 
 Dividend per share (EUR cents)           7.5           7.3 
                                         ------------  ------------ 
 Dividend per share (GBP pence)           6.7           6.4 
                                         ------------  ------------ 
 EPRA NAV per share total return 
  for period (EUR)                        13.2%         53.0% 
                                         ------------  ------------ 
 EPRA NAV per share total return 
  for period (GBP)                        11.4%         57.7% 
                                         ------------  ------------ 
 

Net contracted rental income for the year was 3.2% lower at EUR17.5 million (year to 31 December 2017: EUR18.1 million). This decrease reflects the sale of the Northern German Portfolio in April 2018, effectively offset by strong like-for-like rent per sqm growth of 7.4%.

The Company has reported a profit before tax for the period to 31 December 2018 of EUR56.4 million (2017: EUR138.5 million) which was positively affected by a revaluation gain of EUR66.1 million (2017: EUR157.4 million). The revaluation gain was lower than that experienced in 2017 and is primarily due to a moderation in the rate of market yield compression versus the prior year. Reported earnings per share for the period were EUR0.46 cents (2017: EUR1.21 cents).

EPRA NAV increases by 11.4%

Reported EPRA NAV per share rose by 11.4% in the period to EUR4.58 (GBP4.11) as at 31 December 2018 (31 December 2017: EUR4.11 (GBP3.65)). After taking into account the dividends paid in 2018 of EUR7.35 cents (GBP: 6.5p), which were paid in June and October 2018, the Euro EPRA NAV total return in the period was 13.2% (2017: 53.0%).

IFRS NAV per share rose by 2.3% in the period to EUR4.05 (GBP3.54) (31 December 2017: EUR3.96 (GBP3.52).

Dividend

The Company is pleased to have declared a final dividend of EUR5.15 cents per share (GBP 4.62 pence per share), (2017: EUR5.0 cents; (GBP 4.4 pence per share)), which is expected to be paid on or around 27 June 2019 to shareholders on the register at close of business on 7 June 2019, with an ex-dividend date of 6 June 2019. Taking into account the interim dividend paid in October 2018, the dividend for the year to 31 December 2018 is EUR7.5 cents per share (GBP 6.73 pence per share), (2017: EUR7.3 cents per share; (GBP 6.4 pence per share)).

Since listing on the London Stock Market in June 2015, and including the final dividend for 2018, EUR24.9 million has been returned to Shareholders. The dividend is paid from operating cash flows, including the disposal proceeds from condominium projects and the Company will seek to continue to provide its shareholders with a secure and progressive dividend over the medium term, subject to the distribution requirements for Non-Mainstream Pooled Investments.

Financing

As at 31 December 2018, the Company had gross borrowings of EUR195.3 million (31 December 2017: EUR222.3 million) and cash balances of EUR26.9 million (31 December 2017: EUR27.2 million) equating to a net debt of EUR168.4 million (31 December 2017: EUR195.1 million) and a net loan to value for the Portfolio of 26.1% (31 December 2017: 32.0%).

Nearly all loans are fixed using an interest rate hedge and, as at 31 December 2018, the blended interest rate of all loans across the Portfolio was 2.0%. The average remaining duration of the loan book at 31 December 2018 was 7.7 years (31 December 2017: 8.4 years). By 31 December 2018, all the Company's debt had been refinanced within the previous 24 months.

During the course of 2018, the following ten-year loan facilities were entered into in order to finance newly acquired properties:

   --     April 2018, EUR12.0 million facility; 
   --     July 2018, EUR1.6 million facility, of which EUR0.3 million remains to be drawn; and 

-- December 2018, EUR7.5 million facility of which EUR0.9 million remained to be drawn at 31 December 2018 and was subsequently drawn in February 2019.

In March 2018, the Company successfully refinanced existing debt within PSPF Ltd. & Co.KG, against the properties based in Berlin. An equity release of EUR7.8 million, before costs, was obtained on the existing property portfolio, all of which was drawn by 31 December 2018.

Following the disposal of the non-core Central and Northern Germany assets, EUR40.5 million of the total proceeds of EUR73 million was used to repay debt, with the remainder being reinvested into the portfolio. Further single property disposals amounting to EUR4.1 million were also completed during the year with related debt of EUR3.1 million being repaid.

In November 2018, the Company notarised for disposal the final non-Berlin property for EUR3.9 million. The transaction completed in January 2019.There was no debt secured against the asset.

The Company is currently undertaking a substantive review of its financing requirements to support its future strategy and will update investors following the conclusion of this exercise.

Acquisitions and disposals

The Company has continued to grow in Berlin with a number of carefully targeted acquisitions in central locations which fulfil its strict acquisition criteria. In total, 222 units (210 residential and 12 commercial) were notarised during 2018 for an aggregate purchase price of EUR36.3 million, at an average price per sqm of EUR2,390, and annual fully occupied rent of EUR1.3 million.

The Company intends to continue with its strategy of acquiring in Berlin and, as at 23 April 2019, a further 14 units in Berlin had been notarised since the December 2018 year end for a purchase price of EUR2.4 million, representing a value per sqm of EUR2,956. Acquisitions have been financed using a combination of debt and cash reserves.

In April 2018 the Company completed the sale of its remaining Northern Germany assets for a cash consideration of EUR73.0 million, representing a 26% premium to the Jones Lang LaSalle pre-notarisation valuation. This portfolio, initially acquired in 2006/2007 for an aggregate purchase price of EUR38.7 million, consisted of 34 properties located in Bremen, Hannover, Hildesheim, Verden, Delmenhorst, Kiel, Oldenburg, Lüneburg and Lübeck.

Densification projects

Following the significant increase in rental values in recent years, the Property Advisor is in the process of conducting an exercise to examine the financial viability of new construction within the footprint of the existing portfolio. This could involve both attic conversions and new building construction on land surrounding buildings that are already owned by the Company.

So far, 26 buildings have been identified for attic conversion and permission has been granted for 39 new apartments, with a further 35 in planning. Permission is also being sought for the first new build project in the courtyard of a building already owned by the Company with potential to create 23 new units. Preliminary estimates of the gross development cost for all these projects are in the region of EUR30 million - EUR35 million. The Board is committed to ensuring that any decision to proceed with new construction or investment in existing assets will be based on the project meeting or exceeding the Company's financial return targets.

Condominium sales

The Company has continued with its strategy of crystallising the latent value within the portfolio through selectively reselling apartment blocks as individual units.

Across the Company's condominium projects, a total of 23 units were notarised for sale in 2018, with an aggregate sales value of EUR9.0 million, consistent with the strong sales figures in 2017 of EUR9.1 million. This represents an average value per sqm of EUR4,490, or EUR4,466 excluding commercial units and parking.

Condominium sales proceeds during 2018 represented a 24.2% premium to book value and the average price achieved per sqm for notarised condominiums was a 25.7% premium to the average valuation per sqm for properties in the Berlin portfolio as at 31 December 2018, confirming the potential for valuation creation through apartment privatisation.

These sales constitute a combination of vacant and occupied units and the Property Advisor expects to identify and prepare additional condominium projects for sale, either to tenants, or new buyers during 2019 in order to maintain similar proceeds to previous years.

Market outlook

The trend towards trade protectionism, slowing global growth and an uncertain Brexit outcome have impacted negatively on German GDP forecasts. After averaging 2.1% over the period 2014-2017, Germany's GDP growth slowed to 1.5% in 2018, and the European Commission forecasts this will cool further to 1.1% in 2019, before recovering to 1.7% in 2020. Although headwinds to German economic growth remain, the inherent strength of the German labour market continues, with unemployment levels expected to reduce further (from 5.2% during 2018 to 4.9% in 2019) and employment levels expected to rise.

Berlin's economic growth prospects remain relatively uncorrelated given its comparative under-reliance on manufacturing and skew towards the services sector as a source of job creation. This positive labour market development has been a key driver of Berlin's population growth. Between 2011 and 2017, its population increased by nearly 290,000 and the number of households by almost 200,000. The population is expected to continue to grow. According to the Senate administration, Berlin will require an additional 194,000 apartments by 2030.

Against a backdrop of strong population growth, medium-term demand for residential property will continue to outstrip supply, driven by a combination of high new-build construction costs, lack of available land and a shortage of new build permits. The net effect of this supply-demand imbalance should underpin the rental market and, in turn, create significant future reversionary potential within the Portfolio. This offers potential to improve rental incomes in the event that market rental values stabilise.

With an active market vacancy currently just over 1%, Berlin's regional government has reacted to supply shortage by implementing a growing number of regulatory measures such as:

   --     the exercise of pre-emptive purchase rights; 

-- additional designation of protected residential areas to restrict the partitioning and resale of rental blocks as condominiums.

There has recently been a well-documented grass-roots proposal in Berlin for a referendum which proposes to expropriate properties of large Berlin landlords with over 3,000 units under management. The Property Advisor continues to monitor developments in relation to the proposed referendum, but feels that since the Company owns 2,516 units, the outcome of the referendum is unlikely to affect the Portfolio.

The Company's strategy will continue to develop to ensure that it acts in a responsible manner, adhering at all times to relevant regulatory requirements and property laws.

Notwithstanding the fact that yield compression has moderated, the Property Advisor remains confident that the favourable Berlin demographics outlined above offer opportunity to further improve rental incomes and property values. This, combined with carefully selected Portfolio acquisitions and a continuation of selective condominium sales, leaves the Company well placed for the year ahead.

OUR BUSINESS MODEL

Actively Managing the Portfolio

Underpinning our strategy is a business model that involves our Property Advisor's active management of the portfolio of assets. The key stages of this process are; Acquire, Renovate, Optimise, and Reinvest.

ACQUIRE

The Company focuses on apartment buildings that are sometimes poorly maintained. Through significant reinvestment, the apartments are modernised to improve both the standard of accommodation for tenants and the look of the local neighbourhood. We focus on carefully selected central Berlin micro-locations which offer the potential for medium-term value creation through modernisation and renovation. The Company has historically focussed its acquisitions on properties built before 1914 (Altbau). Single properties, packages and portfolios are considered. Since listing on the London Stock Exchange in June 2015 the Company has notarised on properties with an aggregate valuation on acquisition of EUR206.3 million.

Acquisitions notarised since 2015 stock market listing

 
Year    Region     Purchase    Units   Sqm    Purchase price  Fully occupied 
                  price (EUR)                  Per sqm (EUR)       yield 
2015    Berlin    35,760,000    227   18,197      1,965            4.3% 
        -------  ------------  -----  ------  --------------  -------------- 
2016    Berlin    78,305,000    634   41,406      1,891            4.3% 
        -------  ------------  -----  ------  --------------  -------------- 
2017    Berlin    55,890,000    336   25,135      2,224            3.6% 
        -------  ------------  -----  ------  --------------  -------------- 
2018    Berlin    36,320,000    222   15,195      2,390            3.5% 
        -------  ------------  -----  ------  --------------  -------------- 
Total            206,275,000   1,419  99,933      2,064            4.0% 
                 ------------  -----  ------  --------------  -------------- 
 

RENOVATE

Buildings acquired may require reinvestment to bring them up to modern standards. It can take several years for the Property Advisor's disciplined active asset management strategies to be fully reflected in the valuation of each acquired building.

The scope for value creation is clearly evidenced in buildings acquired during 2016. Acquisitions that had completed by 31 December 2016 were revalued by Jones Lang LaSalle ("JLL") as at 31 December 2018 at an average 97.2% premium to purchase prices. This compares with growth in the properties acquired before 2016 over the same period of 52.4%. This clearly demonstrates the scope for significant value creation that the Property Advisor can achieve through the selective acquisition and repositioning of Berlin properties.

 
 Acquisitions 2016                                       Value 
 Number of properties acquired                              15 
                                                     --------- 
 Purchase Price                                       EUR78.3m 
                                                     --------- 
 Value Growth of 2016 acquisitions (2016 - 31 
  December 2018)                                         97.2% 
                                                     --------- 
 Legacy portfolio valuation growth (2016 - 31 
  December 2018)                                         52.4% 
                                                     --------- 
 Rent per square metre growth of 2016 acquisitions 
  (2016 - 31 December 2018)                              86.5% 
                                                     --------- 
 Legacy portfolio rent per square metre growth 
  (2016 - 31 December 2018)                              79.0% 
                                                     --------- 
 Average fully occupied purchase yield of 2016 
  acquisitions                                            4.3% 
                                                     --------- 
 Average fully occupied yield of portfolio in 
  December 2018                                           3.0% 
                                                     --------- 
 

We place our tenants' interests at the forefront of everything we do. Many of the buildings that we acquire are in poor condition, with a substantial backlog of underinvestment. We therefore seek to improve the standard of accommodation available to tenants through modernisation and renovation of apartments and, where appropriate, their communal areas.

Renovations are carried out sensitively, and we carefully assess each programme of building improvements to ensure that they are justified, avoiding excessive investment which might lead to unaffordable rent increases. Improvements are conducted on a rolling basis across the Portfolio and vary according to the condition of each building and its apartments. Refurbishment of occupied units is only carried out with full agreement from tenants.

Vacant units in poor condition are considered for full renovation and vacant attic space is reviewed for conversion to residential space. Depending on the level of historical under-investment, apartment improvements can involve heating system and boiler upgrades, new insulation, double glazing, new plumbing, kitchen and bathroom renewal, new flooring, and redecoration. Communal areas, both indoor and outdoor, are also reviewed for potential improvement. A single apartment generally costs between EUR20,000 and EUR30,000 to renovate, while an entire building renovation might cost up to EUR2 million.

OPTIMISE

After acquisition, the Property Advisor looks to realign these properties to maximise their potential within the Portfolio.

Realigning rents

For properties considered to be core rental buildings, vacant units are re-let after refurbishment at levels that at all times comply with relevant regulations. Tenant lists are reviewed carefully and, only where appropriate, rent increases are applied for, either where tenants are paying less than the statutory rent level (Mietspiegel), where modernisation has been undertaken (and these costs are allowed to be recouped), or where the lease contains provisions for indexation (Staffel).

Buildings that are re-let typically command a rental premium to in-place rental values. This "reversionary gap" reflects the significant investment in these buildings and their surroundings to bring them up to modern standards.

Berlin reletting premium

 
 Year      Berlin portfolio   Berlin average new leases 
          average rent (EUR      signed by quarter (EUR 
                   per sqm)                    per sqm) 
 2011                   6.2                         6.7 
        -------------------  -------------------------- 
 2012                   6.6                         7.9 
        -------------------  -------------------------- 
 2013                   7.0                         9.1 
        -------------------  -------------------------- 
 2014                   7.4                         9.8 
        -------------------  -------------------------- 
 2015                   8.0                        11.2 
        -------------------  -------------------------- 
 2016                   7.7                        10.6 
        -------------------  -------------------------- 
 2017                   8.1                        11.9 
        -------------------  -------------------------- 
 2018                   8.5                        12.0 
        -------------------  -------------------------- 
 

Realigning through the creation of new living space

As well as acquiring buildings, the Company is now exploring ways to realign existing buildings within the existing portfolio by identifying opportunities to create new residential space. The substantial increase in rental and property values has created potential densification opportunities which could involve both attic conversions and new building construction on land surrounding buildings already owned by the Company.

REINVEST

The properties within the Portfolio are revalued each year with historical investment being reflected in revised property values. To the extent that additional borrowing can be secured on higher property values, a substantial portion are reinvested by way of acquisitions and improvements in the existing portfolio of buildings. For the year ended 2018, 50% of the rental income has been reinvested into the portfolio.

Buildings that no longer fit the strategic objectives of the Portfolio are considered for sale, either as blocks, or via the condominium strategy. Since listing on the Main Market of the London Stock Exchange in June 2015, the Company has been progressively selling its non-Berlin assets. In aggregate these assets have been sold at an average 23.8% premium to trailing book value and the majority of the proceeds have been reinvested into further improvements in the Berlin portfolio and Berlin acquisitions.

Disposals notarised since 2015 stock market listing

 
Region                     2015      2016        2017        2018     Premium to prior 
                                                                        FY book value 
                           (EUR)     (EUR)       (EUR)       (EUR) 
Nuremberg & Furth         870,000                                                77.0% 
                          -------  ---------  -----------  ---------  ---------------- 
Berlin (including 
 Greater Area)                     3,800,000                                     19.1% 
                          -------  ---------  -----------  ---------  ---------------- 
Baden-Wuerttemberg                              6,100,000  3,920,000              6.3% 
                          -------  ---------  -----------  ---------  ---------------- 
Nuremberg & Furth                              35,170,000                        10.7% 
                          -------  ---------  -----------  ---------  ---------------- 
Central & North Germany                        84,050,000                        32.9% 
                          -------  ---------  -----------  ---------  ---------------- 
Total                     870,000  3,800,000  125,320,000  3,920,000             23.8% 
                          -------  ---------  -----------  ---------  ---------------- 
 

Creation of condominiums

In addition to its core rental business, the Company also selectively identifies a small number of condominium projects. The Company is committed to operating within the relevant regulatory and planning frameworks at all times during the condominium realignment process.

This strategy is considered where a significant differential exists between the market value of a rental unit within an apartment block and the resale value of a unit as a private apartment, or where there is limited opportunity to generate further value as a rental building. The process involves legally splitting the freeholds in a small number of selected buildings.

The sales comprise a combination of vacant and occupied units and can augment returns to reinvest in the Portfolio on further acquisitions. As at 31 December 2018, 90 units representing proceeds of EUR26.9 million had completed since condominium sales commenced in mid-2015.

 
 Year    Condominium sales      Berlin rental   Sales Value       Premium to 
             value EUR/sqm    portfolio value        (EURm)    trailing book 
                                      EUR/sqm                      value (%) 
 2015                3,899              1,982           4.7             19.4 
        ------------------  -----------------  ------------  --------------- 
 2016                4,427              2,150           5.5             33.3 
        ------------------  -----------------  ------------  --------------- 
 2017                4,352              3,220           9.1             23.8 
        ------------------  -----------------  ------------  --------------- 
 2018                4,566              3,576           9.9             24.2 
        ------------------  -----------------  ------------  --------------- 
 

THE CHANGING FACE OF BERLIN

During the past decade, Berlin has developed into one of Europe's most vibrant and dynamic cities. Economic and population growth have substantially outstripped nearly all other European cities. Today, services account for 85% of Berlin's economic output and growth in knowledge-based and future-oriented sectors offer a bright future for Berlin's economy and labour market compared with other European cities which have relied more heavily on manufacturing and exports.

Since 2009, employment has increased by more than 30% in aggregate and this development serves as a solid basis for residential market demand in Phoenix Spree's core Berlin residential market.

Whilst manufacturing accounts for one out of four jobs across Germany as a whole, it plays a subordinated role in Berlin, with only one out of eight employees employed in this sector. Berlin has clearly positioned itself as an innovation hub. As its "new world" economy continues to grow and flourish, the city's inward migration trends increasingly reflect the new skills demanded by the labour market. Employment growth has mainly taken place in services, where more than 200,000 jobs were newly created between 2013 and 2018. Almost half of these new jobs were in three services sectors only. First, professional, scientific and technical services; second, other business services; and third, the information and communications sector.

The changing population and employment demographics are reflected in Phoenix Spree's own tenant structure. Analysis of new tenancies signed during 2018 shows that new tenants attracted to Phoenix Spree's rental proposition are almost exclusively from the services sector, over 39% of new leases signed are by tenants that have relocated either from another German city or from another country and only 18% are native Berliners.

New leases signed in 2018 by tenant occupation

 
 Employment sector         Percentage of tenants 
 Customer service          23% 
                          ---------------------- 
 Other services            20% 
                          ---------------------- 
 Students                  16% 
                          ---------------------- 
 Education service         12% 
                          ---------------------- 
 Information Technology    11% 
                          ---------------------- 
 Health services           9% 
                          ---------------------- 
 Technical services        9% 
                          ---------------------- 
 

New leases signed in 2018 by place of birth

 
 Nationality                         Percentage of tenants 
 Native Berliners                    18% 
                                    ---------------------- 
 Other German locations              42% 
                                    ---------------------- 
 Other European Union countries      20% 
                                    ---------------------- 
 Non-European Union but in Europe    6% 
                                    ---------------------- 
 Other countries                     14% 
                                    ---------------------- 
 

Despite the significant rental increases seen in Berlin in recent years, rental values remain relatively low by European standards and rent affordability remains high. For Phoenix Spree, analysis of all new leases signed during 2018 shows that the average tenant net income after tax is EUR43,200 and that the percentage of total rent to income stands at only 26%.

Average monthly rents remain among lowest of all major European cities with the average monthly rent per square metre of EUR9.8 significantly cheaper than other major European cities.

Monthly rents by European City

 
 European City    2018 Monthly Rent (EUR per 
                   sqm) 
 London           28.2 
                 --------------------------- 
 Edinburgh        19.5 
                 --------------------------- 
 Dublin           19.2 
                 --------------------------- 
 Paris            18.0 
                 --------------------------- 
 Barcelona        17.9 
                 --------------------------- 
 Birmingham       16.2 
                 --------------------------- 
 Amsterdam        16.0 
                 --------------------------- 
 Madrid           15.1 
                 --------------------------- 
 Rome             14.0 
                 --------------------------- 
 Frankfurt        13.3 
                 --------------------------- 
 Milan            12.0 
                 --------------------------- 
 Lisbon           10.6 
                 --------------------------- 
 Berlin           9.8 
                 --------------------------- 
 Vienna           9.4 
                 --------------------------- 
 

Source: Knight Frank

Not only are rents comparatively low, but available household incomes are predicted to rise faster in Berlin than in any other European city over the next 10 years.

Average household income growth (% change 2018-2028)

 
 European City    10 years Income Growth (%) 
 Berlin           35.9% 
                 --------------------------- 
 Birmingham       35.1% 
                 --------------------------- 
 Edinburgh        35.2% 
                 --------------------------- 
 Amsterdam        34.0% 
                 --------------------------- 
 London           33.1% 
                 --------------------------- 
 Barcelona        32.7% 
                 --------------------------- 
 Dublin           32.3% 
                 --------------------------- 
 Frankfurt        30.9% 
                 --------------------------- 
 Madrid           30.9% 
                 --------------------------- 
 Milan            29.3% 
                 --------------------------- 
 Lisbon           26.5% 
                 --------------------------- 
 Rome             25.9% 
                 --------------------------- 
 Paris            25.6% 
                 --------------------------- 
 Vienna           21.2% 
                 --------------------------- 
 

Source: Knight Frank

CORPORATE RESPONSIBILITY

Phoenix Spree is committed to acting responsibly by balancing the different interests of all our key stakeholders and capturing this within our Company Values and business model.

Our Approach to Corporate Responsibility

We strive to strike a meaningful balance between proving a return to our investors and addressing our social and environmental impacts. We engage with our stakeholders to ensure we understand differing viewpoints and take this into consideration when making business decisions. We believe that this is not only the right way to approach business, but it will help us maintain a commercial advantage and enable us to be a sustainable company that delivers long term success.

Our business focusses on providing homes for people that are both comfortable and affordable. We often acquire properties that are in relatively poor condition and, through significant reinvestment, we modernise the apartments to improve the standard of accommodation for our tenants and improve the look of the local neighbourhood. Providing good customer service to our tenants and improving the sustainability of housing stock through renovation lies at the core of our business.

In 2018, we reviewed how sustainability is managed within our business and aligned these with the views of our stakeholders and business priorities to create our Company Values and our 'Better Futures' Corporate Responsibility (CR) Plan.

Whilst we are pleased with the progress we are making with the dedication of our partners; we look forward to further communication regarding our CR programme in the coming period.

Corporate Responsibility Governance

To ensure the successful delivery of our 'Better Futures' CR Plan within our business, relevant Policies have been created for each of the pillars, a measurement framework established to monitor progress and a structure put in place to ensure robust oversight.

We share the relevant policies with PMM, who in turn have created their own policies that are aligned with ours. We request that PMM periodically verifies that it has acted in accordance with the policies. Where PMM outsources any key functions to other business partners, it has likewise shared the policies with them and requested that they periodically verify that they have acted within the spirit of the relevant policies.

Structurally, PMM has established a CR Task Force that oversees the implementation of the plan across the business. This Task Force reports the progress on the CR Plan, at minimum twice a year, to Phoenix Spree's CR Sub-Committee, who in turn reports into the Company's Board.

For further information, please visit the company's website at www.phoenixspree.com.

PRINCIPAL RISKS AND UNCERTAINTIES

The Board recognises that effective risk evaluation and management needs to be foremost in the strategic planning and the decision-making process. In conjunction with the Property Advisor, key risks and risk mitigation measures are reviewed by the Board on a regular basis and discussed formally during Board meetings.

 
 RISK                      IMPACT                        MITIGATION                    MOVEMENT 
 Decline in property       Economic, political,          The Property                  Unchanged 
  valuation                 fiscal and legal              Advisor believes 
                            issues can have               German housing 
                            a negative effect             affordability 
                            on property valuations.       metrics remain 
                            A decline in                  favourable relative 
                            Group property                to other European 
                            valuations could              countries and 
                            negatively affect             that German residential 
                            the valuation                 supply-demand 
                            of the Portfolio              dynamics are 
                            and the ability               supportive, with 
                            of the Group                  limited supply 
                            to sell properties            of rental stock 
                            within the portfolio          in urban locations 
                            at valuations                 putting upward 
                            which satisfy                 pressure on rents. 
                            the Group's investment 
                            objective. 
                          ----------------------------  ----------------------------  ----------- 
 Adverse interest          Future interest               The Property                  Unchanged 
  rate movements            rate rises could              Advisor has a 
                            increase the                  record of securing 
                            borrowing cost                financing across 
                            to the Group                  the Portfolio. 
                            which, in turn,               The Group mitigates 
                            could negatively              its exposure 
                            affect the Group's            to adverse interest 
                            financial performance.        rate movements 
                                                          through the use 
                                                          of interest rate 
                                                          swaps or by fixing 
                                                          its interest 
                                                          rates. All new 
                                                          debt drawn in 
                                                          the year was 
                                                          fixed using interest 
                                                          rates swaps. 
                                                          The average blended 
                                                          interest rate 
                                                          of the Group's 
                                                          debt profile 
                                                          is now 2.0% with 
                                                          a blended maturity 
                                                          of 7.7 years. 
                                                          During the past 
                                                          24 months, 100% 
                                                          of the Group's 
                                                          debt has been 
                                                          refinanced. 
                          ----------------------------  ----------------------------  ----------- 
 Inability to              Inability to                  The Company currently         Unchanged 
  sell condominiums         sell condominiums             has split over 
                            in the Berlin                 half the properties 
                            market due to                 in the German 
                            changing political            land registry, 
                            or economic conditions        the final step 
                            could affect                  to allowing the 
                            the Company's                 sale of properties 
                            cashflows in                  as individual 
                            the short term,               condominiums. 
                            which may affect              The Property 
                            the ability of                Advisor reviews 
                            the company to                the condominium 
                            fund its capital              profile of the 
                            expenditure programme         Company on a 
                            or fund its annual            monthly basis 
                            dividend.                     and the Company 
                                                          can onboard new 
                                                          condominium properties 
                                                          quickly for sale 
                                                          if required. 
                          ----------------------------  ----------------------------  ----------- 
 Breach of covenant        Should any fall               The Group has                 Decreasing 
  requirements              in revenues result            no loan to value 
                            in the Group                  covenants on 
                            breaching financial           debt held. The 
                            covenants given               group does have 
                            to any lender,                debt service 
                            the Group may                 coverage covenants 
                            be required to                on its finance 
                            repay such borrowings         with DZ Hyp bank 
                            in whole or in                which are assessed 
                            part, together                annually in January. 
                            with any related              DZ Hyp loan covenant 
                            costs.                        requirements 
                                                          have always been 
                                                          met with significant 
                                                          headroom, and 
                                                          were most recently 
                                                          met in January 
                                                          2019, again with 
                                                          significant headroom. 
                                                          The Property 
                                                          Advisor regularly 
                                                          monitors all 
                                                          debt service 
                                                          coverage covenants 
                                                          and would seek 
                                                          to take remedial 
                                                          measures in advance 
                                                          of any covenant 
                                                          being breached. 
                          ----------------------------  ----------------------------  ----------- 
 Insufficient              Lack of capital               At year end the               Increasing 
  capital to support        may restrict                  Group had cash 
  expansion                 the ability of                reserves of EUR26.9m 
                            the Group to                  and has signed 
                            pursue future                 debt in 2018 
                            investment opportunities      of EUR28.9m, 
                            consistent with               EUR27.6 of which 
                            the overall investment        was drawn. The 
                            objectives.                   Group always 
                                                          maintains very 
                                                          conservative 
                                                          long-term forecasts 
                                                          regarding its 
                                                          cash balances 
                                                          to ensure a three 
                                                          year viability 
                                                          projection. Taking 
                                                          this into account, 
                                                          and current and 
                                                          future spending 
                                                          commitment on 
                                                          improving the 
                                                          portfolio and 
                                                          returns to shareholders, 
                                                          without further 
                                                          debt the Group 
                                                          has limited capacity 
                                                          for acquisitions. 
                                                          It continues 
                                                          to look for methods 
                                                          to achieve further 
                                                          capital on an 
                                                          ongoing basis. 
                          ----------------------------  ----------------------------  ----------- 
 Insufficient              Availability                  The Property                  Unchanged 
  investment opportunity    of potential                  Advisor has been 
                            investments which             active in the 
                            meet the Group's              German residential 
                            investment objective          property market 
                            can be negatively             since 2006. It 
                            affected by supply            has specialised 
                            and demand dynamics           acquisition personnel 
                            within the market             and an extensive 
                            for German residential        network of industry 
                            property and                  contacts including 
                            the state of                  property agents, 
                            the German economy            industry consultants 
                            and financial                 and the principals 
                            markets more                  of other investment 
                            generally.                    funds. It is 
                                                          expected that 
                                                          future acquisitions 
                                                          will be sourced 
                                                          from these channels. 
                          ----------------------------  ----------------------------  ----------- 
 Changes to property       Property laws                 The Property                  Increasing 
  and tenant law            remain under                  Advisor regularly 
                            constant review               monitors the 
                            by the new "Red-Red-Green"    impact that existing 
                            coalition government          and proposed 
                            in Germany and                regulation could 
                            future changes                have on future 
                            to property regulation        rental values 
                            and rent controls             and property 
                            for new tenancies             planning applications. 
                            could negatively              This includes 
                            affect rental                 the potential 
                            values and property           referendum in 
                            valuations.                   Berlin which 
                                                          is discussed 
                                                          on page 11 of 
                                                          this annual report. 
                                                          In order to reduce 
                                                          the dependency 
                                                          upon statutory 
                                                          rent increases, 
                                                          the majority 
                                                          of the new leases 
                                                          signed within 
                                                          the Portfolio 
                                                          include annual 
                                                          indexation (or 
                                                          'Staffel') increases. 
                          ----------------------------  ----------------------------  ----------- 
 Occupancy and             Unexpected vacancy            The Property                  Decreasing 
  tenant risk               and tenant default            Advisor implements 
                            trends across                 strict vetting 
                            the Portfolio                 and screening 
                            could lead to                 processes to 
                            a rental income               improve tenant 
                            shortfall which,              quality across 
                            in turn, may                  the Portfolio. 
                            adversely impact              Where appropriate, 
                            Group profitability           apartments becoming 
                            and investment                vacant are renovated 
                            returns.                      and modernised 
                                                          and then re-let 
                                                          at rents which 
                                                          are at a significant 
                                                          premium to that 
                                                          paid by outgoing 
                                                          tenants. 
                          ----------------------------  ----------------------------  ----------- 
 Reliance on the           The Group's future            Since Listing                  Unchanged 
  Property Advisor          performance depends           on the London 
  and its key personnel     on the success                Stock Exchange, 
                            of the Property               the Property 
                            Advisor's strategy,           Advisor has expanded 
                            skill, judgement              headcount through 
                            and reputation.               the recruitment 
                            The departure                 of several additional 
                            of one or more                experienced London 
                            key employees                 and Berlin-based 
                            may have an adverse           personnel. Additionally, 
                            effect on the                 senior Property 
                            performance of                Advisor personnel 
                            the Group and                 and their families 
                            any diminution                retain a stake 
                            in the Property               in the Group, 
                            Advisor's reputation          aligning their 
                            may have an adverse           interests with 
                            effect on the                 other key stakeholders. 
                            Group's performance.          In November 2018 
                                                          the Group announced 
                                                          that it had signed 
                                                          a new Property 
                                                          Advisor agreement 
                                                          with PMM, committing 
                                                          the Property 
                                                          Advisor to the 
                                                          Fund for the 
                                                          foreseeable future. 
                          ----------------------------  ----------------------------  ----------- 
 Reputational              Adverse publicity             The Group has                 Unchanged 
  risk                      and inaccurate                retained an external 
                            media reporting               public relations 
                            could reflect                 consultancy and 
                            negatively on                 press releases 
                            stakeholders'                 are approved 
                            perception of                 by the Board 
                            the Group, its                prior to release. 
                            strategy and                  The Group maintains 
                            its key personnel.            regular communication 
                                                          with key shareholders 
                                                          and conducts 
                                                          presentations 
                                                          and roadshows 
                                                          to provide investors 
                                                          with relevant 
                                                          information on 
                                                          the Group, its 
                                                          strategy and 
                                                          key personnel. 
                                                          The Group also 
                                                          has a dedicated 
                                                          CSR committee 
                                                          of the Board 
                                                          which ensures 
                                                          the company ethos 
                                                          is in line with 
                                                          societal expectations. 
                          ----------------------------  ----------------------------  ----------- 
 Macro economic            A deterioration               Although the                  Increasing 
  environment               in economic growth            Board and Property 
                            and a recessionary            Advisor cannot 
                            environment could             control external 
                            adversely affect              macroeconomic 
                            tenant demand                 risks, economic 
                            and vacancy,                  indicators are 
                            leading to a                  constantly monitored 
                            reduction in                  by both the Board 
                            rental and property           and Property 
                            values.                       Advisor and Group 
                                                          strategy is tailored 
                                                          accordingly. 
                                                          The Fund is a 
                                                          Jersey & Guernsey 
                                                          based entity 
                                                          operating in 
                                                          Germany, and 
                                                          therefore Brexit 
                                                          should not affect 
                                                          the fund as it 
                                                          currently operates 
                                                          outside the UK. 
                                                          However, the 
                                                          uncertainty surrounding 
                                                          Brexit continues 
                                                          to affect the 
                                                          macroeconomic 
                                                          environment around 
                                                          Europe and the 
                                                          situation continues 
                                                          to be monitored 
                                                          by both the Board 
                                                          and Property 
                                                          Advisor 
                          ----------------------------  ----------------------------  ----------- 
 Non- compliance           Failure to identify           The Group employs             Unchanged 
  with new regulatory       and respond to                internal compliance 
  accounting and            the introduction              and corporate 
  taxation legislation      of new financial              governance advisors 
                            regulation in                 to provide updates 
                            a timely manner.              and boardroom 
                            Risk of reputational          briefings on 
                            damage, penalties             regulatory changes 
                            or fines.                     likely to impact 
                                                          the Group. The 
                                                          Group works closely 
                                                          with external 
                                                          accountants and 
                                                          tax advisors 
                                                          to keep up to 
                                                          date with changes 
                                                          to financial 
                                                          regulation in 
                                                          the UK, Channel 
                                                          Islands and Germany. 
                          ----------------------------  ----------------------------  ----------- 
 Loss of data              Illegal access                Review of IT                  Increasing 
  due to cyber              of commercially               systems and infrastructure 
  security attack           sensitive information         in place to ensure 
  on IT systems             and potential                 these are as 
                            to impact investor,           robust as possible. 
                            supplier and                  Service Providers 
                            tenant confidentiality.       are required 
                                                          to report to 
                                                          the board on 
                                                          request on their 
                                                          financial controls 
                                                          and procedures. 
                                                          Service providers 
                                                          are also required 
                                                          to hold detailed 
                                                          risk and controls 
                                                          registers regarding 
                                                          their IT systems. 
                                                          The board is 
                                                          currently reviewing 
                                                          its IT procedures 
                                                          and controls 
                                                          for the 2019 
                                                          financial year. 
                          ----------------------------  ----------------------------  ----------- 
 

Directors' report

The Directors are pleased to present their Annual Report and the audited consolidated financial statements for the year ended 31 December 2018.

General information

The Company is a public limited company and incorporated in Jersey, Channel Islands under the Companies (Jersey) Law 1991. The Company was admitted to the premium segment of the Main Market of the London Stock Exchange on 15 June 2015.

The Group's objective is to generate an attractive return for shareholders through the acquisition and active management of high-quality pre-let properties in Germany. The Group is primarily invested in the residential market, supplemented with selective investments in commercial property. The majority of commercial property within the portfolio is located within residential and mixed-use properties.

Dividends

The Directors recommend a final dividend of EUR5.15 cents (2017: EUR5.0 cents) per Ordinary Share to be paid on or around 27 June 2019 to ordinary shareholders on the register on 7 June 2019.

The Directors declared a dividend of EUR5.0 cents per share on 26 April 2018, paid on 29 June 2018 to ordinary shareholders on the register on 8 June 2018 and a further dividend of EUR2.35 cents per share on 26 September 2018, paid on 19 October 2018 to ordinary shareholders on the register on 5 October 2018.

Directors

The Directors who served during 2018 and to date are as follows:

 
 Name of Director 
 
 R Hingley                           Independent Non-executive director, 
                                      Chairman 
                                    ------------------------------------ 
 R Prosser (resigned 17 April        Non-executive director 
  2018) 
                                    ------------------------------------ 
 M Northover (resigned 24 January    Non-executive director 
  2018) 
                                    ------------------------------------ 
 Q Spicer                            Independent Non-executive director 
                                      (Not independent from 7 March 
                                      2019) 
                                    ------------------------------------ 
 A Weaver (resigned 17 April 2018)   Non-executive director 
                                    ------------------------------------ 
 C Valeur (appointed 24 January      Independent Non-executive director 
  2018) 
                                    ------------------------------------ 
 J Thompson (appointed 24 January    Independent Non-executive director 
  2018) 
                                    ------------------------------------ 
 M O'Keefe (appointed 17 April       Independent Non-executive director 
  2018) 
                                    ------------------------------------ 
 

Directors' indemnities

The Company has made third party indemnity provisions for the benefit of its Directors which were in place throughout the year and remain in force at the date of this report.

Substantial shareholdings

As at 9 April 2019, the Company has received the following notifications under chapter 5 of the Disclosure and Transparency Rules of shareholdings of more than 5% of the Company's share capital:

 
 Name of holder          Percentage of voting   No. of Ordinary Shares 
                          rights 
 Bracebridge Capital, 
  LLC                    12.2%                  12,288,503 
                        ---------------------  ----------------------- 
 Thames River Capital    8.0%                   8,088,096 
                        ---------------------  ----------------------- 
 Invesco                 6.8%                   6,872,314 
                        ---------------------  ----------------------- 
 
 

Requirements of the Listing Rules

The following table provides references to where the information required by the Listing Rule 9.8.4R is disclosed.

 
 Listing Rule requirement 
 A statement of the amount of interest capitalised by the group         Not applicable 
 during the period under review 
 with an indication of the amount and treatment of any related tax 
 relief. 
                                                                       ----------------------------------------------- 
 Any information required by LR 9.2.18 R (Publication of unaudited      Not applicable 
 financial information). 
                                                                       ----------------------------------------------- 
 Details of any long-term incentive schemes as required by LR 9.4.3     Not applicable 
 R. 
                                                                       ----------------------------------------------- 
 Details of any arrangements under which a director of the company      No such waivers 
 has waived or agreed to 
 waive any emoluments from the company or any subsidiary undertaking. 
 Where a director has 
 agreed to waive future emoluments, details of such waiver together 
 with those relating to 
 emoluments which were waived during the period under review. 
                                                                       ----------------------------------------------- 
 Details required in the case of any allotment for cash of equity       No such share allotments 
 securities made during the 
 period under review otherwise than to the holders of the company's 
 equity shares in proportion 
 to their holdings of such equity shares and which has not been 
 specifically authorised by 
 the company's shareholders. This information must also be given for 
 any major unlisted subsidiary. 
                                                                       ----------------------------------------------- 
 Where a listed company has listed shares in issue and is a             Not applicable 
 subsidiary undertaking of another 
 company, details of the participation by the parent undertaking in 
 any placing made during 
 the period under review. 
                                                                       ----------------------------------------------- 
 Details of any contract of significance subsisting during the period   a) Notes 27,33 to the accounts 
 under review:                                                           b) No controlling shareholder, not applicable 
 (a) to which the listed company, or one of its subsidiary 
 undertakings, is a party and in 
 which a director of the listed company is or was materially 
 interested; and 
 (b) between the listed company, or one of its subsidiary 
 undertakings, and a controlling 
 shareholder. 
                                                                       ----------------------------------------------- 
 Details of contracts for the provision of services to the listed       No controlling shareholder, not applicable 
 company or any of its subsidiary 
 undertakings by the controlling shareholder. 
                                                                       ----------------------------------------------- 
 Details of any arrangement under which a shareholder has waived or     No such agreements 
 agreed to waive any dividends, 
 where a shareholder has agreed to waive future dividends, details of 
 such waiver together 
 with those relating to dividends which are payable during the period 
 under review. 
                                                                       ----------------------------------------------- 
 Board statement in respect of relationship agreement with the          No controlling shareholder, not applicable 
 controlling shareholder. 
                                                                       ----------------------------------------------- 
 

Corporate Governance

The Directors have prepared a statement on how the UK Corporate Governance Code has been applied, which is set out on pages 35 to 44.

Financial instruments

Details of the financial risk management objectives and policies followed by the Directors can be found in note 3 to the consolidated financial statements.

Events after the reporting date

-- In April 2019, the Company exchanged contracts for the acquisition of one individual property in Berlin for the purchase price of EUR2.4 million. The property is still awaiting completion.

-- The Company had exchanged contracts for the acquisition of one property in Berlin with a purchase price of EUR2.2 million prior to the balance sheet date, which as at balance sheet date had not yet completed. The purchase completed in January 2019.

-- In Q1 2019, the Company exchanged contracts for the sale of one commercial unit and one residential unit in BoxhagenerStraße with an aggregated purchase price of EUR1.9 million. The sale of these units subsequently completed in April 2019.

-- The Company had exchanged contracts for the sale of three condominiums in Berlin with aggregated consideration of EUR1.1 million prior to the reporting date. The sale of these units subsequently completed in Q1 2019.

-- The Company exchanged contracts for the disposal of the last non-Berlin property for the sale price of EUR3.9 million prior to the reporting date, the sale of this property subsequently completed in January 2019.

-- In February 2019, the Company drew down the final EUR0.9 million portion of the EUR7.5 million loan with Berliner Sparkasse. EUR6.6 million of the debt was drawn down in December 2018.

Auditor

Each of the Directors at the date of approval of this Annual Report has taken all the steps that he or she ought to have taken as a Director in order to make him or herself aware of any relevant audit information and to establish that the Group's auditor is aware of that information. The Directors are not aware of any relevant audit information which has not been disclosed to the auditor.

RSM UK Audit LLP has expressed its willingness to continue in office as auditor and a resolution to reappoint them will be proposed at the forthcoming Annual General Meeting.

Viability Statement

The Directors have assessed the viability of the Group over a three-year period. The Directors have chosen three years because that is the period over which the Group has sufficiently robust forecasts as part of its business plan. The Viability Statement is based on a robust assessment of those risks that would threaten the business model, future performance, solvency or liquidity of the Group. For the purposes of the Viability Statement the Directors have considered, in particular, the impact of the following factors affecting the projections of cash flows for the three-year period ending 31 December 2021:

a) the potential operating cash flow requirement of the Group;

b) seasonal fluctuations in working capital requirements;

c) property vacancy rates;

d) rent arrears and bad debts;

e) capital and administration expenditure (excluding potential acquisitions as set out below) during the period; and

f) condominium sales proceeds.

The Directors recognise that the projections of cash flows do not include the impact of further potential property acquisitions over the three-year period, as these acquisitions are ad hoc and discretionary in nature. In this respect, the Directors complete a formal review of the working capital headroom of the Group for each potential acquisition.

On the basis of the above, and assuming the principal risks are managed or mitigated as expected, the Directors have a reasonable expectation that the Group will be able to continue in operation and meet its liabilities as they fall due over the three-year period of their assessment.

Registered office

13-14 Esplanade

St Helier

Jersey

JE1 1EE

Channel Islands

Corporate Governance Statement

This Corporate Governance Statement comprises pages 35 to 44 and forms part of the Directors' Report.

To comply with the UK Listing Regime, the Company must comply with Listing Rule 9.8.6(5) R which requires the Company to apply the main principles of the UK Corporate Governance Code ('the Code') most recently published in July 2018 and report to shareholders how the Company has applied these principles or explain any departures therefrom.

On 16 July 2018, the Financial Reporting Council ('FRC') published the 2018 Code of Corporate Governance. The Code is available for download from the Financial Reporting Council's ('FRC') website www.frc.org.uk.

The Board intends to adopt The AIC Code of Corporate Governance (the AIC Code) for the accounting period beginning 1 January 2019. The Board deems the AIC Code more relevant with respect to the governance of investment companies.

The Board has considered the principles and recommendations of the Code. During the year, the Company has complied with all of the provisions of the Code except as set out below;

   --      the role of the Chief Executive and Executives of the Board; 
   --      Executive Directors' remuneration; 
   --      the internal audit function; 
   --      the composition of the Audit Committee and Risk Committee (rectified during 2018). 

The Board considers that the provisions relating to the chief executive and executive directors' role and remuneration are not relevant to the Company, as the running of PSD's business is outsourced to third parties and there are no executive directors. The objective of the Code to separate the roles of the chairman who manages and provides leadership to the Board, and the running of PSDL, is achieved because the Chairman is independent from the third-party providers.

PSDL does not currently have an internal audit function as the Board believe that it can ensure that PSDL's risk management, governance and internal control processes are operating effectively without this. This is because PSDL's business is conducted by relatively few individuals (through the outsourced service providers) who report to the Board, and its operations are not complex. However, if PSDL increases in size, the appointment of an appropriately qualified and resourced internal audit department will be, and is currently being, considered. Ultimately this role will be widened to encompass reviews of the efficiency of operations and to make recommendations on rationalisation of the business. If established, such internal audit department would report directly to the Audit Committee.

The members of the Audit and Risk Committees have been selected for their experience and expertise in relation to the risks, financial reporting and internal controls relating to PSDL. The members bring specific experience in relation to the property investment sector and externally managed structures which have been found to be invaluable to each Committee in identifying risks and assessing the mitigating controls which have been established.

Board Leadership and Company Purpose

In accordance with the Code's Principles A, B, C, D & E following the changes to its composition in 2018, the Board was considered wholly independent for the year 2018 with no representation of external service providers on the Board. From 7 March 2019 Quentin Spicer was no longer considered to be an Independent Non-executive director due to his length of service exceeding 10 years. The Board, however, consider his detailed knowledge of the company a significant asset and are happy for him to continue as a non-executive director for the coming period. The board assesses the basis on which the Company generates and preserves value over the long-term. Additionally, the board considers and addresses the opportunities and risks to the future success of the Company, along with the sustainability of the Company's business model and how its governance contributes to the delivery of its strategy.

This is achieved by considering the following matters:

-- the overall objectives of the Company as described under the sections headed "Our Strategy" & "Business Model" in the Strategic Report, and the strategy for fulfilling those objectives within an appropriate risk framework in light of market conditions prevailing from time to time;

-- the appointment of the Property Advisor, administrator and other appropriately skilled service providers and to monitor their effectiveness through regular reports and meetings; and

-- the key elements of the Group's performance including NAV and EPRA NAV growth and the payment of dividends.

Further to the above the Board has adopted a Diversity Policy which sets out the Board's approach to diversity in board composition confirming that the Board would make any new appointments on merit taking into consideration gender diversity.

The Company has no direct employees therefore is not required to monitor culture in this respect, however the Board recognises its wider responsibility to demonstrate to shareholders that it is operating responsibly, managing its social and environmental impacts for the benefit of all stakeholders. Following a thorough review of how sustainability is managed within the Company, a "Better Futures" Corporate Responsibility Plan has been developed. This will provide a framework to measure existing activities better while adding new initiatives to improve overall sustainability.

Additionally, the Board is mindful of culture within each of its service providers and stakeholders and where it is not satisfied that policy, practices or behaviours are aligned with the Company's purpose, values and strategy, the Board will seek assurance that management have taken corrective action.

The Board has overall responsibility for maximising the Group's success by directing and supervising the affairs of the business and meeting the appropriate interests of shareholders and relevant stakeholders, while enhancing the value of the Group and also ensuring protection of investors.

Within the Annual Report and Financial Statements, the Directors have set out the Group's investment objective and policy and have reported how the Board and its delegated Committees operate and how the Directors review the risk environment within which the Group operates and set appropriate risk controls. Furthermore, the Board has sought to provide further information to enable shareholders to understand the Group's business and financial performance better. The Board also maintains a formal schedule of matters specifically reserved solely for their decision.

The Chairman shall also be responsible for the promotion of a culture of openness and debate, for ensuring that the Directors receive accurate, timely and clear information and for ensuring that there is adequate time available for the discussion of agenda items at each Board meeting.

The Board believes that the maintenance of good relations with both institutional and retail shareholders is important for the long-term prospects of the Group. The Board receives feedback on the views of shareholders from its corporate broker. Through this process the Board seeks to monitor the views of shareholders and to ensure an effective communication programme. The Board shall seek to utilise stakeholder communication to inform them of the decisions that the Company and Board takes, whether about the products or services it provides, or about its strategic direction, its long-term health, and the society in which it operates. The Board agrees that stakeholder engagement will strengthen the business and promote its long-term success to the benefit of stakeholders and shareholders alike.

The Chair is open to discussions on governance and strategy with major Shareholders and the other Directors shall also be provided the opportunity to attend these meetings

The Board believes that the Annual General Meeting provides an appropriate forum for investors to communicate with the Board and encourages participation.

The Group regularly reviews its shareholder profile. Shareholders may contact the Company directly through the Investor section of the Company's website www.phoenixspree.com.

The Board identifies and manages conflicts of interest, including those resulting from significant shareholdings, and also ensures that the influence of third parties does not compromise or override independent judgement.

If a Board recommendation for a resolution receives 20% or more of votes cast against it, the Company will explain, when announcing voting results, any actions it intends to take to consult shareholders in order to understand the reasons behind the result. No later than six months after the shareholder meeting, the Company will publish an update on the views received from shareholders and any actions taken. The Board will then provide a final summary in the Annual Report and Financial Statements and, if applicable, in the explanatory notes to resolutions at the next shareholder meeting, on the impact the feedback has had on the decisions the Board has taken and any actions or resolutions that are to be proposed.

Where Directors have concerns about the operation of the Board or the management of the Company that cannot be resolved, their concerns are recorded in the Board minutes. On resignation, a non-executive director will also provide a written statement to the Chair, for circulation to the board, if they have any such concerns in connection with resignation.

Division of Responsibilities

In adherence with the Codes Principles F, G, H & I, following the appointment of two new independent Directors in January 2018 and a further appointment in April 2018, the Board comprised five non-executive Directors, one of whom also acts as Chairman of the Company. The Chairman is Robert Hingley, who is considered to be independent for the purposes of Listing Rule 15 and Provision 9 of the Code as he has neither current nor historical employment with the Property Advisor nor any current directorships in any other investment funds managed by the Property Advisor. Listing Rule 15 requires there to be a majority of independent directors on the board as a whole which was not in place until the new appointments. The Chair ensures the Directors receive accurate, timely and clear information.

On 24 January 2018, the Company announced the appointments of two further independent non-executive Directors, Charlotte Valeur and Jonathan Thompson. At the same time, Matthew Northover, a non-independent Director, stepped down from the board to focus on the business of the Property Advisor. Furthermore, on 17 April 2018, Monique O'Keefe was appointed as an independent non-executive Director and chair of the Corporate Responsibility Committee, and both Richard Prosser and Andrew Weaver stepped down from the board.

Charlotte Valeur is the senior independent Non-executive Director. The Board has evaluated her independence and considers Charlotte to remain independent.

The Board considers its current Non-executive Directors to be of sufficient calibre and number for their views to be of sufficient weight and that no individual or small group can dominate the Board's decision-making process. Their qualifications and experience are relevant to their directorships and in their appointments to the Committees where applicable.

Due to his 10-year tenure of service on the Board, Quentin Spicer was deemed to be no longer independent. The Board however considers his detailed knowledge of the company a significant asset and is happy for him to continue as a non-executive director for the coming period.

The Non-executive Directors' terms and conditions of appointment are available for inspection at the

Company's registered office on request and will be available at the forthcoming AGM.

The Directors believe that the Board has an appropriate balance of skills, experience and independence to discharge its duties and provide effective strategic leadership and proper governance of the Company. The Board shall ensure that it conducts its business at all times with only the interests of the Shareholders in mind and independently of any other associations.

Independence of Non-executive Directors

The Code states that the Board should identify in the annual report each non-executive director it considers to be independent and should consider whether there are any relationships or circumstances that are likely to affect a Director's independence. On 7 March 2019 Quentin Spicer was no longer considered as an Independent Non-executive director by the board due to his length of service exceeding 10 years.

The senior independent director is to provide a sounding board for the chair and serve as an intermediary for the other directors and shareholders. Led by the senior independent director, the non-executive directors will meet without the chair present at least annually to appraise the chair's performance, and on other occasions as necessary.

Non-executive Directors' shareholdings

The Board has assessed that the holdings of the Directors are not significant and believes such levels of investment should not raise questions regarding their independence. The Board considers that Directors owning shares in the Company directly aligns them with the interests of the shareholders.

The responsibilities of the chair, senior independent director, board and committees are clear and set out in writing, after they are agreed by the board. They can be found on the Company's website, www.phoenixspree.com.

When considering any new appointments, the board takes into account any other demands on directors' time. Prior to appointment, any significant commitments are disclosed along with an indication of the time involved. Additionally, any external appointments are not undertaken without prior approval of the board. Any reasons for permitting significant appointments will be explained further in this report as and when the time arises.

All directors have access to the advice of the Company Secretary, who is responsible for advising the Board on all governance matters. Both the appointment and removal of the Company Secretary would be a matter for the whole Board.

Composition, succession and evaluation

In adherence with the Codes Principles J, K & L, the Board has established a Nomination and Remuneration Committee which is chaired by Quentin Spicer with Robert Hingley, Charlotte Valeur, Jonathan Thompson and Monique O'Keefe as members.

The Nomination and Remuneration Committee met twice during the year.

As at the year-end there were five Directors, 3 of whom are male and 2 are female. The Directors have agreed that appointments to the Board should be made on the basis of the Group's specific needs based on merit, without reference to age, gender or religious belief. Charlotte Valeur and Jonathan Thompson were appointed to the Board on 24 January 2018 (with Matthew Northover stepping down) and Monique O'Keefe was appointed on 17 April 2018 (with Richard Prosser and Andrew Weaver stepping down).

Re-election

All newly appointed Directors shall stand for election by the shareholders at the next Annual General Meeting following their appointment. There are provisions in the Company's Articles of Association which require Directors to seek re-election on a periodic basis, however, in accordance with the Code all other Directors shall also offer themselves for annual re-election. There is no limit on length of service, nor is there any upper age restriction on Directors. The names of all Directors standing for appointment or reappointment shall be accompanied by sufficient biographical details and the specific reasons why their contribution is, and continues to be, important to the company's long-term sustainable success in order to enable shareholders to make an informed decision.

The Board considers that there is significant benefit to the Group arising from continuity and experience among Directors, and accordingly does not intend to introduce restrictions based on age or tenure. It does, however, believe that shareholders should be given the opportunity to review membership of the Board on a regular basis.

After the most recent appointments, the Board is satisfied that all the Board members standing for re-election should be re-elected as they have the right skills and experience to continue to manage the Group. The Board maintains its right to appoint further members if deemed necessary and considers succession on a regular basis.

The Board has implemented a process of formal evaluation for individual Directors, the Committees and the processes utilised by the Board itself. This is undertaken by the Chair and the Audit Committee.

The Board areas of evaluation include:

   --      Board composition and quality; 
   --      Overall strategy, performance and risk; 
   --      Shareholder value; 
   --      Governance; 
   --      Board meetings; 
   --      Support and relations with suppliers; 
   --      Personal evaluation; 
   --      Chair's evaluation. 

The process of performance evaluation is designed to consider all elements of performance including any perceived shortcomings, training or development needs and unforeseen tasks and responsibilities that have arisen during the year.

The Chairman shall act on the results of the evaluation by recognising the strengths and addressing any weaknesses of the Board. Each Director shall engage with the process and take appropriate action where development needs have been identified.

The Chairman and the Board have agreed to regular externally facilitated board evaluations being undertaken, which shall occur as necessary under the requirements of the Code. Jones Lang LaSalle is the appointed external property valuer, it has no connection either to the Company, or to any of the Directors of the Company.

While no KPIs are set for individual Non-executive Directors, the time, effort and application to the performance of their duties for the Board and Committees is taken into account.

The Board, the Committees and the management process - performance evaluation

In line with the requirements of the Code, the Company has implemented annual performance evaluations of the Board, the Committees and the processes utilised by each forum. The aim of the evaluation is to recognise the strengths and address any weaknesses and consider improvements to the management process. The evaluation is designed to ensure that the Board meets its objectives and effectiveness is maximised.

The evaluations focus on the following issues:

   --      the frequency of meetings and the business transacted; 
   --      the workload of each forum; 
   --      diversity and how effectively members work together to achieve objectives; 
   --      the timing, level of detail and appropriateness of information put before meetings; 
   --      the reporting process from Committees to the Board and delegation process itself; 

-- the levels of expertise available within the membership of the Committees and the need for, selection of and the use of external consultants; and

-- the effectiveness of internal controls following the review and report of the Audit Committee.

Following the changes to the Board, and if any potential future changes are made, due consideration to the evaluation process will be made.

Audit, risk and internal control

Audit and Risk Committee

Neither Matthew Northover nor Richard Prosser, up to the dates of their resignations, were considered to be independent Members of the Board as a consequence of their relationship with the Property Advisor or the Administrator respectively. However, during the financial year, Jonathan Thompson, an independent Non-executive Director, has been appointed to chair the Audit Committee, and Charlotte Valeur the Risk Committee, meaning that the Company will comply with the Code principles and recommendations on the composition of the Committee in future periods.

On 17 April 2018, Monique O'Keefe joined both the Audit and Risk Committee and the committees split to become a separate Audit Committee and Risk Committee.

Audit Committee

The Audit Committee is chaired by Jonathan Thompson with Quentin Spicer, Charlotte Valeur and Monique O'Keefe as members. The Audit Committee meets no less than three times a year and, if required, meetings can also be attended by the Property Advisor and the external auditor. The Board considers that Jonathan's recent and relevant experience, both in the sector, and in financial reporting, make him suitably qualified to chair the Audit Committee.

In adherence with the Code's Principles M & N, the Audit Committee is responsible for ensuring that the accounting policies of the Company are appropriate and being followed, disclosures provided are clear and for reviewing the half-year and annual financial statements before their submission to the Board. In addition, the Audit Committee is specifically charged under its terms of reference to advise the Board on the terms and scope of the appointment of the auditors, including their remuneration, independence and objectivity and reviewing with the auditors the results and effectiveness of the audit. The Committee reviews and provides advice on whether the content of the annual report and accounts is fair, balanced and understandable and provides the information necessary for Shareholders to assess the Company's performance, business model and strategy.

The Group does not currently have an internal audit function, as the Board believes that it can ensure that the Group's risk management, governance and internal control processes are operating effectively without this. This is because the Group's business is conducted by relatively few individuals (through the outsourced service providers) who report to the Board, and its operations are not complex at present. However, if the Group increases in size or complexity, the appointment of an appropriately qualified and resourced internal audit department will be, and is being, considered. Ultimately this role will be widened to encompass reviews of the efficiency of operations and to make recommendations on rationalisation of the business. Once established, such internal audit department would report directly to the Audit Committee.

The Board is satisfied that the Annual Report and Financial Statements, taken as a whole, are fair, balanced and understandable and provide the information necessary for shareholders to assess the Group's position and performance, business model and strategy.

Risk Committee

The Risk Committee is chaired by Charlotte Valeur with Quentin Spicer, Jonathan Thompson and Monique O'Keefe as members. The Risk Committee meets no less than three times a year and, if required, meetings can also be attended by the Property Advisor.

In adherence with the Code's Principle O, The Risk Committee is responsible for advising the Board on the Company's overall risk appetite, tolerance and strategy. The Risk Committee will also oversee and advise the Board on the current risk assessment processes, ensuring that both qualitative and quantitative metrics are used. Where requested by the Board, the Committee shall review and provide advice on whether the content of the risk management and internal control report, as contained in the annual report, is fair, balanced and understandable and provides the information necessary for Shareholders to assess the Company's performance, business model and strategy.

The Members of both the Audit and Risk Committees have been selected for their experience and expertise in relation to the risks, financial reporting and internal controls relating to the Group. The Members bring specific experience in relation to the property investment sector and externally managed structures which has been found to be invaluable to the Committee in identifying risks and assessing the mitigating controls which have been established.

Remuneration

In adherence with the Code's Principles P Q & R the Board considers that the provisions relating to the Chief Executive and Executive Directors' roles and remuneration are not relevant to the Group, as the running of the Group's business is outsourced to third parties and there are no executive directors. The objective of the Code, to separate the roles of the Chairman who runs the Board, and the running of the Group, is achieved because the Chairman is independent from the third-party providers. The remuneration of the directors and the third-party providers is disclosed and explained in the notes to the financial statements.

Effectiveness

The Company holds a minimum of four Board meetings per year to discuss general management, structure, finance, corporate governance, marketing, risk management, compliance, asset allocation and gearing, contracts and performance. The reports provided by the outsourced providers are the principal source of regular information for the Board enabling it to determine policy and to monitor performance, compliance and controls, which are supplemented by communication and discussions throughout the year. The Board carries out internal evaluations of its effectiveness which are described on page 39 of the annual report. Furthermore, the Board has contracted BoardAlpha to carry out an external review of the Board's effectiveness. The scope of this external effectiveness evaluation is in line with the scope set out on page 39.

Committees of the Board

The terms of reference for the Board Committees are available on the Company website at www.phoenixspree.com.

Property Valuation Committee

The Company has established a Property Valuation Committee. The Property Valuation Committee is responsible for reviewing the property valuations prepared by the valuer and any further matters relating to the valuation of the Portfolio.

During 2018, the Property Valuation Committee's composition changed, following the appointment of the Board's new independent directors. It continued to be chaired by Quentin Spicer, with Charlotte Valeur and Jonathan Thompson joining as members on 24 January 2018. Richard Prosser ceased to be a member of the Property Valuation Committee following his resignation from the Board on 17 April 2018 and Monique O'Keefe and Robert Hingley were both appointed.

The Property Valuation Committee met four times during the year and reported to the Board on its duties, which are to:

   --      review significant adjustments from the previous property valuation report; 
   --      review the individual valuations of each property; 

-- receive any commentary from the Property Advisor and/or Directors following the review meeting held with the external valuer;

-- register and discuss with the Property Advisor any asset specific issues highlighted by the valuer;

-- review material, unexplained movements in the Group's Net Asset Value and to recommend the release of the Net Asset Value announcement following that review;

-- review compliance with applicable standards and guidelines including those issued by the Royal Institution of Chartered Surveyors and the UKLA Listing Rules;

   --      review the findings and any recommendations or statements made by the valuer; 

-- review at least annually, consider and make recommendations to the Board, in relation to the appointment, remuneration, re-appointment and removal of the Group's valuer. The Committee shall oversee the selection process for a new valuer and if a valuer resigns the Committee shall investigate the issues leading to this and decide whether any action is required;

   --      consider any further matters relating to the valuation of the properties. 

The Committee reported to the Board its findings on the property valuation and the Committee was satisfied with the independent valuation report and values associated with all properties of the Group.

Corporate Social Responsibility Committee

On 17 April 2018, the Company formed a Corporate Social Responsibility Committee. The Corporate Social Responsibility Committee is chaired by Monique O'Keefe with Jonathan Thompson, Charlotte Valeur, Robert Hingley and Quentin Spicer as members. The Corporate Social Responsibility Committee meets no less than three times a year.

The Corporate Social Responsibility Committee is responsible for approving a strategy for discharging the Company's corporate and social responsibilities, overseeing the creation of appropriate policies and supporting measures along with ensuring that the policies are regularly reviewed and updated in line with national and international regulations. Where requested by the Board, the Committee shall review and provide advice on whether the content of the CR report, as contained in the Company's annual report, is fair, balanced and understandable and provides the information necessary for Shareholders to assess the Company's performance, business model and strategy.

Management Engagement Committee

In accordance with the Code, the Management Engagement Committee was established to review the performance of the Property Advisor on an annual basis. It was previously chaired by Robert Hingley, with Richard Prosser and Quentin Spicer as members. On 24 January 2018, the Management Engagement Committee's composition has changed with Robert Hingley remaining as Chair but with Charlotte Valeur and Jonathan Thompson joining as members. Richard Prosser ceased to be a member of the Management Engagement Committee following his resignation from the Board on 17 April 2018 and Monique O'Keefe was appointed.

The Management Engagement Committee met three times during the year and reported to the Board on its duties, which are to:

-- monitor and evaluate the Property Advisor's performance and compliance with the terms of the Property Advisory Agreement and, if necessary, provide appropriate guidance, which may include considering the merit of obtaining an independent appraisal of the Property Advisor's services on an annual basis;

-- review the terms of the Property Advisory Agreement from time to time to ensure that the terms thereof conform with market and industry practice and remain in the best interests of shareholders and make recommendations to the Board on any variation to the terms of the Property Advisory Agreement which it considers necessary or desirable;

-- review and make appropriate recommendations to the Board as to whether the continuing appointment of the Property Advisor is in the best interests of the Group and Shareholders, and the reasons for this recommendation;

-- review the level and method of remuneration, the basis on which the performance fees (if any) are calculated and the notice period of the Property Advisor, giving due consideration to the competitive position of the Group against its peer group;

-- consider whether the asset and estate management fee should be based on gross assets, net assets or market capitalisation;

-- ensure that the basis of any performance fee or performance related element does not encourage excessive risk and that it rewards demonstrably superior performance by the Property Advisor in managing the portfolio against the Group's stated objectives when compared to a suitable benchmark or peer group;

-- ensure that a sound system of risk management and internal control is maintained and reviewed annually in order to safeguard shareholders' investment and the Group's assets;

-- review, consider and recommend any amendments to the terms of the appointment and remuneration of providers of other services to the Group; and

-- consider any points of conflict which may arise between the providers of services to the Group.

The Committee keeps under review the performance of the Property Advisor and the level and terms of the management fee. On 27 November 2018 the Group announced that it had signed a new contract with the Property Advisor, effective from 1 January 2019. Further information on this contract can be seen in note 33 to the Financial Statements, and on http://www.phoenixspree.com. In the opinion of the Directors, the continuing appointment of the Property Advisor on the terms agreed is in the interests of shareholders as a whole. The Performance Period as set out in the previous Property Advisory agreement ended on 30 June 2018. According to the new agreement, the Performance Period starts on the 1 July 2018, ending on 31 December 2020. The Performance Period commences benchmarked from the EPRA Net Asset Value of the Company as at 30 June 2018.

Board and Committee meetings

The table below sets out the number of Board, Audit Committee, Risk Committee, Property Valuation Committee, Management Engagement Committee and Nomination and Remuneration Committee meetings held during the year ended 31 December 2018 and, where appropriate, the number of such meetings attended by each Director.

 
                 Scheduled         Audit           Risk 
                   Board 
              --------------  --------------  -------------- 
               Held   Attend   Held   Attend   Held   Attend 
------------  -----  -------  -----  -------  -----  ------- 
 R Hingley     4      4        -      -        1      1 
 R Prosser     1      1        -      -        -      - 
 Q Spicer      4      4        4      4        1      1 
 J Thompson    4      4        4      4        1      1 
------------  -----  -------  -----  -------  -----  ------- 
 C Valeur      4      3        4      2        1      1 
------------  -----  -------  -----  -------  -----  ------- 
 M O'Keefe     4      4        4      4        1      1 
------------  -----  -------  -----  -------  -----  ------- 
 A Weaver      1      1        -      -        -      - 
------------  -----  -------  -----  -------  -----  ------- 
 
 
                 Property       Management        Nomination 
                 Valuation       Engagement      & Remuneration 
------------  --------------  --------------  ------------------ 
               Held   Attend   Held   Attend   Held     Attend 
------------  -----  -------  -----  -------  -------  --------- 
 R Hingley     4      4        3      3        2        2 
 R Prosser     4      1        3      -        -        - 
 Q Spicer      4      4        3      2        2        2 
 J Thompson    4      4        3      2        2        2 
------------  -----  -------  -----  -------  -------  --------- 
 C Valeur      4      3        3      3        2        2 
------------  -----  -------  -----  -------  -------  --------- 
 M O'Keefe     4      2        3      3        2        2 
------------  -----  -------  -----  -------  -------  --------- 
 A Weaver      -      -        -      -        -        - 
------------  -----  -------  -----  -------  -------  --------- 
 

During the year, there have been several additional ad-hoc meetings which the directors were required to attend. These meetings consisted of material matters relating to the running of the Group.

Information and support for Directors

New Directors receive a full, formal and tailored induction on joining the Board in order to further inform them of the Group's activities and structure.

Upon appointment new Directors are briefed about their responsibilities and duties, together with relevant background information on the Company and assistance and information from representatives of the Investment Advisors and the Administrators.

New Directors are also provided with an opportunity to observe the Board before their appointment and meet representatives of the Property Advisors and Administrators to the Company.

All the Directors comply with mandatory continued professional development requirement and are encouraged to attend industry and other seminars covering issues and developments relevant to investment companies, and Board meetings regularly include agenda items on recent developments in governance and industry issues.

The Chair regularly reviews and agrees with each Director their training and development needs.

All Directors are able to take independent professional advice at the Group's expense in the furtherance of their duties, if necessary.

The Group purchases appropriate insurance in respect of legal action against its Directors and Officers.

Company Secretary

The Company Secretary is responsible for ensuring that Board procedures are followed. Under the guidance of the Chairman, the Secretary ensures that appropriate and timely information flows between the Board, the Committees and to/from the Directors. It facilitates inductions to new Directors and the provision of additional information where required and appropriate.

The Secretary is responsible for advising the Board on governance matters and is available to all Directors for advice and support as required. The Board is presently considering the merit of adopting the AIC code and certain other relevant elements of the UK code of corporate governance.

The Board intends to adopt the AIC Code of Corporate Governance (the AIC Code) for the accounting period beginning 1 January 2019. The Board deems the AIC Code more relevant with respect to the governance of investment companies.

Audit Committee Report

This report provides details of the role of the Committee and the duties it has undertaken during the year under review.

Summary of the role of the Audit Committee

The Audit Committee is responsible for reviewing the half-year and annual financial statements and recommends them to the Board for approval. The role of the Audit Committee includes:

-- Monitoring the integrity of the Annual Report and Financial Statements of the Group, covering:

-- formal announcements relating to the Group's financial performance;

-- significant financial reporting issues and judgements;

-- matters raised by the external auditors; and

-- the appropriateness of accounting policies and practices.

   --      Reviewing and considering the Code and FRC Guidance on Audit Committees. 

-- Monitoring the quality and effectiveness of the independent external auditors, which includes:

-- meeting regularly to discuss the audit plan and the subsequent audit report;

-- considering the level of fees for both audit and non-audit work;

-- reviewing independence, objectivity, expertise, resources and qualification; and

-- making recommendations to the Board on the appointment, reappointment, replacement and remuneration of the external auditors.

-- Reviewing the Group's procedures for prevention, detection and reporting of fraud, bribery and corruption.

-- Monitoring and reviewing the internal control and risk management systems of the service providers together with the need for an Internal Audit function.

The Audit Committee's full terms of reference can be obtained from the Company's website www.phoenixspree.com.

Financial reporting

The Audit Committee is responsible for reviewing the half-year and annual financial statements before their submission to the Board. In addition, the Audit Committee is specifically charged under its terms of reference with advising the Board on the terms and scope of the appointment of the auditors, including their remuneration, independence, objectivity and reviewing with the auditors the results and effectiveness of the audit.

Composition of the Audit Committee

The Audit Committee is chaired by Jonathan Thompson with Quentin Spicer, Charlotte Valeur and Monique O'Keefe as members. The qualifications and experience of the members of the Audit and Risk Committee during the financial year are set out in their biographical details on pages 23 and 24.

Meetings

The Audit Committee is scheduled to meet no less than three times a year and, if required, meetings can also be attended by the Property Advisor, the administrator and the external auditor.

Significant issues related to the financial statements

 
 Valuation of investment property      Mitigation 
 A significant focus for the           The Group has appointed Jones 
  Audit Committee is the valuation      Lang LaSalle ("JLL") to act 
  of the Group's property portfolio     as the Independent Property 
  carried out at half year in           Valuer. The Audit Committee 
  June and at the financial year        is satisfied that the valuer 
  end in December each year, as         is independent and that it conducted 
  this is a key determinant of          its work in accordance with 
  the Group's NAV, its profit           the Royal Institution of Chartered 
  or loss and the Property Advisor's    Surveyors Valuation Standards 
  remuneration.                         (RICS). 
 
                                        The Property Valuation Committee 
                                        reviews the valuer's report, 
                                        the methodology followed and 
                                        the assumptions incorporated 
                                        to assess the adequacy of the 
                                        valuation. They also meet the 
                                        independent valuers JLL as part 
                                        of the valuation review. 
 

External audit

Assessing the effectiveness of the external audit process

The Committee satisfied itself as to the effectiveness of the external audit process as follows:

The audit partner

As a new audit firm was appointed in 2014, no additional rotation considerations were required for the current year. This is however the final year cycle for the current audit partner who is subject to mandatory rotation at the end of the 2018 Financial Statement audit process. Following completion of the audit the Committee assessed the partner's performance against expectations and found this to be satisfactory.

The audit team

Continuity of personnel was reviewed and found to be satisfactory. To supplement the Committee's necessarily limited exposure to junior members of the audit team, feedback was sought on the performance of the external audit team, in particular as regards their understanding of the business, technical competence and attitude.

The audit plan

The scope of the audit was reviewed and debated by the Committee with the auditors prior to work being commenced. This was done in the light of both the auditors' and the Committee's assessment of the key risks. The auditors explained materiality thresholds used in determining their audit scope and the Committee confirmed that these were in accordance with normal audit practice.

The generality of the audit plan document was assessed and found to be satisfactory. Arrangements to identify, report and manage conflicts of interest were satisfactory.

The Committee also considered whether it wished to commission further audit work to be conducted beyond which the auditor considered necessary for the expression of their opinions on the Group accounts and concluded that it did not.

Matters arising from the audit

These were promptly and effectively communicated and addressed as appropriate. The robustness and perceptiveness of the auditors in their handling of the key accounting and audit judgements were seen as appropriate. The detailed report received from the auditors following completion of their work gave comfort as to the diligence of execution of that work.

Added value

In appraising the overall performance of the auditors, the Committee considered whether they had provided useful feedback arising from their work additional to their statutory responsibilities and concluded that they had.

Independence

In addition to receiving the auditors' formal confirmation of their independence, the Committee considered whether this was demonstrated through their general approach and attitude and were satisfied that this was the case.

Audit fees

The level of audit fees was reviewed to ensure that it was sufficient for the work necessary but not excessive. In particular, changes in fees from the previous year were considered in relation to changes in the Group and in risk assessments.

Audit tendering

The Committee considered whether the audit appointment should be put out to tender. In doing so, it considered both the performance of the current auditors and the likely costs and potential benefits of change.

Following the above, the Audit Committee has recommended to the Board that RSM UK Audit LLP is reappointed.

Going forward, the Committee will continue to keep the audit appointment under review, having regard for the new EU requirements for audit tendering.

Group policy on the provision of non-audit services by the auditor

The Committee has an established policy for the commission of non-audit work from the Group's auditor.

The external auditor is excluded from providing non-audit services to the Group where the objectives of such assignments are inconsistent with the objectives of the audit. Additionally, no work is awarded to the auditor which would result in an element of self-review, either during the work or via the audit itself.

The Committee will continue to approve all non-audit fees prior to the work commencing and review the non-audit fees in aggregate for the year.

Risk management and internal control

The Committee reviews the adequacy and effectiveness of the Group's (and its service providers') internal financial controls and internal control and risk management systems and review and approves the statements to be included in the Annual Report concerning internal controls and risk management.

The Committee is also responsible for oversight and advice to the Board on the current risk exposures and future risk strategy of the Group.

The Directors have carried out a robust assessment of the principal risks facing the Group, including those that would threaten its business model, future performance, solvency or liquidity. The result of this review, the potential impact of each type of risk identified and the mitigation reasons put in place are set out in the 'Principal Risks and Uncertainties' section of the Annual Report on pages 25 to 30. The Directors do not consider that there are any significant problems facing the business in the coming year.

Internal audit

The Group does not currently have an internal audit function, as the Board believes that it can ensure that the Group's risk management, governance and internal control processes are operating effectively without this. This is because the Group's business is conducted by relatively few individuals (through the outsourced service providers) who report to the Board, and its operations are not complex at present. However, if the Group increases in size, the appointment of an appropriately qualified and resourced internal audit department will be considered.

Directors' Remuneration Report

Introduction

This report is on the activities of the Nomination and Remuneration Committee. The information provided in this part of the Directors' Report is not subject to audit, except where stated.

Remuneration policy

During 2018, the Nomination and Remuneration Committee comprised four non-executive directors and the Chairman and is chaired by Quentin Spicer, with Robert Hingley, Monique O'Keefe, Charlotte Valeur and Jonathan Thompson as members. Andrew Weaver ceased to be a member of the Nomination and Remuneration Committee following his resignation from the Board on 17 April 2018.

The Group's policy is that the remuneration of the Directors should reflect the experience of the Board as a whole, the time commitment required, and be fair and comparable with that of other similar companies. Furthermore, the level of remuneration should be sufficient to attract and retain the Directors needed to oversee the Group properly and to reflect its specific circumstances. There were no changes to the policy during the year and it is intended that this policy will continue to apply for the year ending 31 December 2019.

Duties

The Committee was responsible for setting the Directors' remuneration levels, in conjunction with the Chairman and with consideration of the following:

-- levels of Directors' remuneration should reflect the time commitment and responsibilities of the role;

-- non-executive Directors' remuneration should not include share options or other performance-related elements;

-- careful consideration should be given to what compensation commitments entail in the event of early termination of a Director's appointment;

   --      notice of contract periods should be set at one year or less; 
   --      no Director should be involved in deciding his or her own remuneration; 

-- independent judgement and discretion should be exercised when authorising remuneration outcomes, taking account of company and individual performance and wider circumstances.

The Committee is also responsible for judging where to position the Group relative to other companies in relation to the level of Directors' remuneration, but using such comparisons with caution in view of the risk of increased remuneration with no corresponding improvement in performance; and considering and making the appropriate recommendations to the Board with regard to the need to appoint external remuneration consultants.

The terms of reference of the Nomination and Remuneration Committee can be obtained from the Company's website www.phoenixspree.com.

For the years ended 31 December 2018 and 31 December 2017 Directors' fees were as follows:

 
 Audited                     2018                            2017 
                 Annual     Special               Annual     Special 
                    Fee    Projects     Total*       Fee    Projects     Total 
               --------  ----------  ---------  --------  ----------  -------- 
                    GBP         GBP        GBP       GBP         GBP       GBP 
               --------  ----------  ---------  --------  ----------  -------- 
 R Hingley       50,000      25,275     75,275    45,000         Nil    45,000 
               --------  ----------  ---------  --------  ----------  -------- 
 R Prosser          Nil         Nil        Nil    25,000         Nil    25,000 
               --------  ----------  ---------  --------  ----------  -------- 
 M Northover        Nil         Nil        Nil       Nil         Nil       Nil 
               --------  ----------  ---------  --------  ----------  -------- 
 M O'Keefe       40,000       4,916     44,916       Nil         Nil       Nil 
               --------  ----------  ---------  --------  ----------  -------- 
 Q Spicer        40,000       5,069     45,069    35,000         Nil    35,000 
               --------  ----------  ---------  --------  ----------  -------- 
 A Weaver           Nil         Nil        Nil    25,000         Nil    25,000 
               --------  ----------  ---------  --------  ----------  -------- 
 C Valeur        40,000       5,008     45,008       Nil         Nil       Nil 
               --------  ----------  ---------  --------  ----------  -------- 
 J Thompson      45,000      12,423     57,423       Nil         Nil       Nil 
               --------  ----------  ---------  --------  ----------  -------- 
 Total          215,000      52,691    267,691   130,000         Nil   130,000 
               --------  ----------  ---------  --------  ----------  -------- 
 

*Total director fees for 2018 in the table above reconciles to the directors' fees in note 8 when converted from EUR to GBP at an average rate of EUR/GBP 1.119

During 2018, additional attention was required from the Directors over and above their normal duties with respect to a significant transaction that was considered but not pursued. It was agreed by the committee that additional remuneration, of an amount up to or equal to the annual salary of each Director, could be expensed to the Group. Details of the additional remuneration payable to the Directors are disclosed above and within note 12 to the consolidated financial statements.

During 2018, Richard Prosser was a Director of Estera Fund Administrators (Jersey) Limited, the Group's Administrator. The remuneration of Estera is disclosed in Note 33.

During 2018, Andrew Weaver was a Partner in Appleby's, the Group's Jersey Legal Advisor. The remuneration of Appleby's is disclosed in Note 33.

During 2018, Matthew Northover was a Partner in PMM Partners Ltd., the Group's Property Advisor. The remuneration of PMM Partners Ltd. is disclosed in Note 33.

Directors' Responsibilities

The Directors are responsible for preparing the Annual Report and the consolidated financial statements in accordance with applicable law and regulations.

Jersey company law requires the Directors to prepare financial statements for each financial year, in accordance with generally accepted accounting principles. The Directors are required under the Listing Rules of the Financial Conduct Authority to prepare the financial statements in accordance with International Financial Reporting Standards ('IFRS'), as adopted by the European Union ('EU').

The financial statements are required by law and IFRS as adopted by EU to present fairly the financial position of the Group.

Under Jersey company law the Directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Group and of the profit or loss of the Group for that period.

In preparing the financial statements, the Directors are required to:

   --      select suitable accounting policies and then apply them consistently; 
   --      make judgements and estimates that are reasonable and prudent; 
   --      state whether they have been prepared in accordance with IFRS as adopted by the EU; 

-- prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Group and the Company will continue in business.

The Directors are responsible for keeping proper accounting records, which disclose with reasonable accuracy at any time the financial position of the Group and to enable them to ensure that the financial statements comply with the Companies (Jersey) Law 1991. They are also responsible for safeguarding the assets of the Group and the Company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

The Directors confirm that these financial statements comply with these requirements.

The Directors are responsible for the maintenance and integrity of the corporate and financial information included on the Company's website. Legislation in Jersey governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.

Directors' Responsibility Statement

The Directors confirm that to the best of their knowledge:

-- the consolidated financial statements, prepared in accordance with the applicable set of accounting standards (as detailed above) and Company Law, give a true and fair view of the assets, liabilities, financial position and profit and loss of the issuer and the undertakings included in the consolidation taken as a whole;

-- the management report includes a fair review of the development and performance of the business and the position of the issuer and the undertakings included in the consolidation taken as a whole, together with a description of the principal risks and uncertainties they face, as well as the business model and strategy of the Group; and

   --      the Annual Report and consolidated financial statements, as a whole, are fair, balanced and understandable and provide the information necessary for shareholders to assess the Group's position, performance, business model and strategy. 
 
 Consolidated Statement of Comprehensive Income 
 For the year ended 31 December 2018 
 
 
                                                                                           Year ended                 Year ended 
                                                                                          31 December                31 December 
                                                                                                 2018                       2017 
                                                   Notes                                                               (restated 
                                                                                                                           - see 
                                                                                                                            note 
                                                                                                                            2.2) 
                                                                                              EUR'000                    EUR'000 
 Continuing operations 
 
 Revenue                                             6                                         22,681                     23,667 
 Property expenses                                   7                                       (15,763)                   (12,587) 
 
 Gross profit                                                                                   6,918                     11,080 
 
 Administrative expenses                             8                                        (3,194)                    (2,967) 
 Gain on disposal of investment property 
  (including investment property held 
  for sale)                                         10                                          1,026                      5,319 
 Investment property fair value gain                11                                         66,146                    157,374 
 Performance fee due to property advisor            27                                        (4,010)                   (26,339) 
 Separately disclosed items                         12                                          (966)                          - 
 
 Operating profit                                                                              65,920                    144,467 
 
 Net finance charge                                 13                                        (9,491)                    (5,995) 
 
 Profit before taxation                                                                        56,429                    138,472 
 
 Income tax expense                                 14                                       (11,071)                   (26,150) 
 
 Profit after taxation                                                                         45,358                    112,322 
 
 Other comprehensive income                                                                         -                          - 
 
 Total comprehensive income for the year                                                       45,358                    112,322 
                                                                                =====================   ======================== 
 
 Total comprehensive income attributable to: 
 Owners of the parent                                                                          45,094                    111,538 
 Non-controlling interests                                                                        264                        784 
                                                                                               45,358                    112,322 
                                                                                =====================   ======================== 
 
 Earnings per share attributable to the owners of the parent: 
 From continuing operations 
 Basic (EUR)                                        30                                           0.46                       1.21 
 Diluted (EUR)                                      30                                           0.46                       1.11 
                                                                                =====================   ======================== 
 
 
 Consolidated Statement of Financial Position 
 At 31 December 2018 
 
 
                                                                                                As at                      As at 
                                                                                          31 December                31 December 
                                                                                                 2018                       2017 
                                                   Notes                                                               (restated 
                                                                                                                           - see 
                                                                                                                            note 
                                                                                                                            2.2) 
                                                                                              EUR'000                    EUR'000 
 ASSETS 
 
 Non-current assets 
 Investment properties                              17                                        632,933                    502,360 
 Property, plant and equipment                      19                                             88                         92 
 Deferred tax asset                                 14                                            948                        527 
 Other financial assets at amortised 
  cost                                              20                                          2,406                      2,323 
                                                                                              636,375                    505,302 
 
 Current Assets 
 Investment properties - held for sale              18                                         12,747                    106,897 
 Trade and other receivables                        21                                          7,531                     14,404 
 Cash and cash equivalents                          22                                         26,868                     27,182 
                                                                                               47,146                    148,483 
 
 Total assets                                                                                 683,521                    653,785 
                                                                                =====================   ======================== 
 
 EQUITY AND LIABILITIES 
 
 Current liabilities 
 Borrowings                                         23                                          3,642                      2,646 
 Trade and other payables                           24                                         10,429                      6,522 
 Derivative financial instruments                   25                                          1,354                          - 
 Current tax                                        14                                          1,387                      2,914 
                                                                                               16,812                     12,082 
 Non-current liabilities 
 Borrowings                                         23                                        191,632                    219,648 
 Derivative financial instruments                   25                                          4,637                      3,333 
 Other financial liabilities                        26                                          7,135                      5,663 
 Deferred tax liability                             14                                         53,458                     45,117 
 
                                                                                              256,862                    273,761 
 
 Total liabilities                                                                            273,674                    285,843 
                                                                                =====================   ======================== 
 
 Equity 
 Stated capital                                     28                                        196,578                    162,630 
 Share based payment reserve                        27                                          4,010                     33,953 
 Retained earnings                                                                            207,270                    169,634 
 Equity attributable to owners of the parent                                                  407,858                    366,217 
 
 Non-controlling interest                           29                                          1,989                      1,725 
 Total equity                                                                                 409,847                    367,942 
                                                                                ---------------------   ------------------------ 
 
 Total equity and liabilities                                                                 683,521                    653,785 
                                                                                =====================   ======================== 
 
 
 Consolidated Statement of Changes in Equity 
 For the year ended 31 December 2018 
 
 
 
                                                        Attributable to the owners of the parent 
 
                                     Share 
                                     based 
                         Stated    payment        Retained                            Non-controlling                      Total 
                        capital    reserve        earnings              Total                interest                     equity 
                        EUR'000    EUR'000         EUR'000            EUR'000                 EUR'000                    EUR'000 
 
 Balance at 1 January 
  2017                  162,630      7,614          64,074            234,318                     941                    235,259 
 Comprehensive income: 
 Profit for the year          -          -         111,538            111,538                     784                    112,322 
 Other comprehensive          -          -               -                  -                       -                          - 
  income 
 Total comprehensive 
  income for the year         -          -         111,538            111,538                     784                    112,322 
 
 Transactions with owners - 
 recognised directly in equity: 
 Dividends paid               -          -         (5,978)            (5,978)                       -                    (5,978) 
 Performance fee              -     26,339               -             26,339                       -                     26,339 
 Balance at 31 
  December 
  2017                  162,630     33,953         169,634            366,217                   1,725                    367,942 
 
 Comprehensive income: 
 Profit for the year          -          -          45,094             45,094                     264                     45,358 
 Other comprehensive          -          -               -                  -                       -                          - 
  income 
 Total comprehensive 
  income for the year         -          -          45,094             45,094                     264                     45,358 
 
 Transactions with owners - 
 recognised directly in equity: 
 Issue of shares         33,948   (33,948)               -                  -                       -                          - 
 Dividends paid               -          -         (7,458)            (7,458)                       -                    (7,458) 
 Performance fee              -      4,010               -              4,010                       -                      4,010 
 Adjustment to 
  perfomance 
  fee                         -        (5)               -                (5)                       -                        (5) 
 
 Balance at 31 
  December 
  2018                  196,578      4,010         207,270            407,858                   1,989                    409,847 
                       ========   ========      ==========   ================   =====================   ======================== 
 
 The share based payment reserve was established in relation to the issue 
  of shares for the payment of the performance fee of the property advisor. 
 
 Retained earnings are the undistributed reserves to be either reinvested 
  within the Group or distributed to shareholders as dividends. 
 
 
 
 
 Consolidated Statement of Cash Flows 
 For the year ended 31 December 2018 
 
 
                                                                                           Year ended                 Year ended 
                                                                                          31 December                31 December 
                                                                                                 2018                       2017 
                                                                                              EUR'000                    EUR'000 
 
 Profit before taxation                                                                        56,429                    138,472 
 
 Adjustments for: 
 Net finance charge                                                                             9,491                      5,995 
 Gain on disposal of investment property                                                      (1,026)                    (5,319) 
 Investment property revaluation gain                                                        (66,146)                  (157,374) 
 Depreciation                                                                                      16                         23 
 Performance fee charge                                                                         4,010                     26,339 
 Operating cash flows before movements in working capital                                       2,774                      8,136 
 
 Decrease / (increase) in receivables                                                           6,492                    (3,048) 
 Increase in payables                                                                           3,908                        788 
 Cash generated from operating activities                                                      13,174                      5,876 
 Income tax paid                                                                              (4,678)                       (50) 
 Net cash generated from operating activities                                                   8,496                      5,826 
 
 Cash flow from investing activities 
 Proceeds on disposal of investment property                                                   86,021                     60,436 
 Interest received                                                                                 54                        103 
 Capital expenditure on investment property                                                   (7,943)                    (6,715) 
 Property additions                                                                          (47,329)                   (76,486) 
 Additions to property, plant and equipment                                                      (12)                       (75) 
 Net cash used in investing activities                                                         30,791                   (22,737) 
 
 Cash flow from financing activities 
 Interest paid on bank loans                                                                  (5,118)                    (5,080) 
 Repayment of bank loans                                                                     (54,680)                  (117,712) 
 Drawdown on bank loan facilities                                                              27,660                    154,414 
 Dividends paid                                                                               (7,458)                    (5,978) 
 Net cash generated from financing activities                                                (39,596)                     25,644 
 
 Net increase in cash and cash equivalents                                                      (309)                      8,733 
 
 Cash and cash equivalents at beginning of year                                                27,182                     18,450 
 Exchange gains on cash and cash equivalents                                                      (5)                        (1) 
 
 Cash and cash equivalents at end of year                                                      26,868                     27,182 
                                                                                =====================   ======================== 
 
 
 Reconciliation of Net Cash Flow to Movement in Debt 
 For the year ended 31 December 2018 
                                                                                           Year ended                 Year ended 
                                                                                          31 December                31 December 
                                                                                                 2018                       2017 
                                                                                              EUR'000                    EUR'000 
 
 Cashflow from increase in debt financing                                                    (27,020)                     36,702 
 Change in net debt resulting from cash flows                                                (27,020)                     36,702 
                                                                                ---------------------   ------------------------ 
 Movement in debt in the year                                                                (27,020)                     36,702 
 Debt at the start of the year                                                                222,294                    185,592 
 Debt at the end of the year                                                                  195,274                    222,294 
                                                                                =====================   ======================== 
 
 
 
 Notes to the Financial Statements 
 For the year ended 31 December 2018 
 
 
 
 1 - General information 
 The Group consists of a Parent Company, Phoenix Spree Deutschland Limited 
  ('the Company'), incorporated in Jersey, Channel Islands and all its 
  subsidiaries ('the Group') which are incorporated and domiciled in and 
  operate out of Jersey, Guernsey and Germany. Phoenix Spree Deutschland 
  Limited is listed on the premium segment of the Main Market of the London 
  Stock Exchange. 
 
 The Group invests in residential and commercial property in Germany. 
 
 The registered office is at 13-14 Esplanade, St Helier, Jersey, JE1 
  1EE, Channel Islands. 
 
 2 - Summary of significant accounting policies 
 The principal accounting policies adopted are set out below. 
 
 2.1 Basis of preparation 
 The consolidated financial statements have been prepared in accordance 
  with International Financial Reporting Standards, International Accounting 
  Standards and interpretations (collectively, 'IFRS'), International 
  and Financial Reporting Interpretation Committee ('IFRIC') interpretations, 
  as adopted by the European Union ('IFRS as adopted by the EU'). 
 
 In accordance with Section 105 of The Companies (Jersey) Law 1991, the 
  Group confirms that the financial information for the year ended 31 
  December 2018 are derived from the Group's audited financial statements 
  and that these are not statutory accounts and, as such, do not contain 
  all information required to be disclosed in the financial statements 
  prepared in accordance with International Financial Reporting Standards 
  ("IFRS"). 
 
 The statutory accounts for the year ended 31 December 2018 have been 
  audited and approved, but have not yet been filed. 
 
  The Group's audited financial statements for the period ended 31 December 
  2018 received an unqualified audit opinion and the auditor's report 
  contained no statement under section 113B (3) and (6) of The Companies 
  (Jersey) Law 1991. 
 
  The financial information contained within this preliminary statement 
  was approved and authorised for issue by the Board on 26 April 2019. 
 
 
 2.2 Change of accounting policy 
 The Group has carried out a review of IFRS 15, Revenue from Contracts 
  with Customers, which is effective from 1 January 2018. The main outcome 
  of the review is to recognise service charges to tenants as revenue, 
  and service costs recharged to tenants as property costs, whereas in 
  prior years, service charges incurred on the properties were offset 
  against service charge income. In accordance with the transition provisions 
  of IFRS 15, the Group has adopted the new rules retrospectively and 
  has restated comparatives for the 2017 financial year. For the 2018 
  financial year the effect has been to recognise service charge revenue 
  of EUR5.173 million, and property expenses of EUR5.173 million, and 
  to increase trade and other receivables by EUR4.766 million, and service 
  charges payable by EUR4.028 million. For the year 2017, this has resulted 
  in an increase in revenue of EUR5.587 million with a corresponding increase 
  in other property expenses along with an increase in trade and other 
  receivables of EUR4.403 million and a corresponding increase in service 
  charges payable. The change of policy has no effect on reported profit 
  or net assets. 
 
 2.3 Going concern 
 The Directors have prepared projections for the period to 31 December 
  2021. These projections have been prepared using assumptions which the 
  Directors consider to be appropriate to the current financial position 
  of the Group as regards to current expected revenues and its cost base 
  and the Group's investments, borrowing and debt repayment plans and 
  show that the Group should be able to operate within the level of its 
  current resources and expects to comply with all covenants for the foreseeable 
  future. The Group's business activities together with the factors likely 
  to affect its future development and the Group's objectives, policies 
  and processes from managing its capital and its risks are set out in 
  the Strategic Report. After making enquiries the Directors have a reasonable 
  expectation that the Group has adequate resources to continue in operational 
  existence for the foreseeable future. The Group therefore continues 
  to adopt the going concern basis in preparing its consolidated financial 
  statements. 
 
 2.4 Basis of consolidation 
 The consolidated financial statements incorporate the financial statements 
  of the Company and entities controlled by the Company (its subsidiaries). 
  The Company controls an entity when the Group is exposed to, or has 
  rights to, variable returns through its power over the entity. Subsidiaries 
  are fully consolidated from the date on which control is transferred 
  to the Group. They are deconsolidated from the date that control ceases. 
 
 Profit or loss and each component of other comprehensive income are 
  attributable to the owners of the Company and to the non-controlling 
  interests. Total comprehensive income of the subsidiaries is attributable 
  to the owners of the Company and to the non-controlling interests even 
  if this results in the non-controlling interests having a deficit balance. 
 
 Accounting policies of subsidiaries which differ from Group accounting 
  policies are adjusted on consolidation. All intra-group transactions, 
  balances, income and expenses are eliminated on consolidation. 
 
 Non-controlling interests in subsidiaries are identified separately 
  from the Group's equity therein. Those interests of non-controlling 
  shareholders that present ownership interests entitling their holders 
  to a proportionate share of net assets upon liquidation may initially 
  be measured at fair value or at the non-controlling interests' proportionate 
  share of the fair value of the acquiree's identifiable net assets. The 
  choice of measurement is made on an acquisition-by-acquisition basis. 
  Other non-controlling interests are initially measured at fair value. 
  Subsequent to acquisition, the carrying amount of non-controlling interests 
  is the amount of those interests at initial recognition plus the non-controlling 
  interests' share of subsequent changes in equity. 
 
 Changes in the Group's interests in subsidiaries that do not result 
  in a loss of control are accounted for as equity transactions. The carrying 
  amount of the Group's interests and the non-controlling interests are 
  adjusted to reflect the changes in their relative interests in the subsidiaries. 
  Any difference between the amount by which the non-controlling interests 
  are adjusted and the fair value of the consideration paid or received 
  is recognised directly in equity and attributed to the owners of the 
  Company. 
 
 2.5 Revenue recognition 
 Revenue includes rental income and service charges and other amounts 
  directly recoverable from tenants. Rental income and service charges 
  from operating leases are recognised as income on a straight-line basis 
  over the lease term. When the Group provides incentives to its tenants, 
  the cost of incentives are recognised over the lease term, on a straight-line 
  basis, as a reduction of rental income. 
 
 2.6 Foreign currencies 
 (a) Functional and presentation currency 
 The currency of the primary economic environment in which the Company 
  operates ('the functional currency') is the Euro (EUR). The presentational 
  currency of the consolidated financial statements is also the Euro (EUR). 
 
 (b) Transactions and balances. 
 Foreign currency transactions are translated into the functional currency 
  using the exchange rates prevailing at the dates of the transactions. 
  At each reporting date, monetary assets and liabilities that are denominated 
  in foreign currencies are retranslated at the rates prevailing at that 
  date. Foreign exchange gains and losses resulting from such transactions 
  are recognised in the consolidated statement of comprehensive income. 
 
 Non-monetary items carried at fair value that are denominated in foreign 
  currencies are translated at the rates prevailing at the date when the 
  fair value was determined. Non-monetary items that are measured in terms 
  of historical cost in a foreign currency are not retranslated. 
 
 2.7 Segment reporting 
 Operating segments are reported in a manner consistent with the internal 
  reporting provided to the chief operating decision-maker. The chief 
  operating decision-maker, who is responsible for allocating resources 
  and assessing performance of the operating segments, has been identified 
  as the Board of Directors. 
 
 2.8 Operating profit 
 Operating profit is stated before the Group's gain or loss on its financial 
  assets and after the revaluation gains or losses for the year in respect 
  of investment properties and after gains or losses on the disposal of 
  investment properties. 
 
 2.9 Administrative and property expenses 
 All expenses are accounted for on an accruals basis and are charged 
  to the consolidated statement of comprehensive income in the period 
  in which they are incurred. Service charge costs, to the extent that 
  they are not recoverable from tenants, are accounted for on an accruals 
  basis and included in property expenses. 
 
 2.10 Separately disclosed items 
 Certain items are disclosed separately in the consolidated financial 
  statements where this provides further understanding of the financial 
  performance of the Group, due to their significance in terms of nature 
  or amount. 
 
 2.11 Property Advisor fees 
 The element of Property Advisor fees for management services provided 
  are accounted for on an accruals basis and are charged to the consolidated 
  statement of comprehensive income. These fees are detailed in note 7 
  and classified under 'Property advisors' fees and expenses'. The settlement 
  of the Property Advisor performance fees is detailed in note 27. Due 
  to the nature of the settlement of the performance fee, any movement 
  in the amount payable at the year end is reflected within the share 
  based payment reserve on the consolidated statement of financial position. 
 
 2.12 Investment property 
 Property that is held for long-term rental yields or for capital appreciation, 
  or both, and that is not occupied by the Group, is classified as investment 
  property. 
 
 Investment property is measured initially at cost, including related 
  transaction costs. After initial recognition, investment property is 
  carried at fair value, based on market value. 
 
 The change in fair values is recognised in the consolidated statement 
  of comprehensive income for the year. 
 
 A valuation exercise is undertaken by the Group's independent valuer, 
  Jones Lang LaSalle GmbH ('JLL'), at each reporting date in accordance 
  with the methodology described in note 17 on a building-by-building 
  basis. Such estimates are inherently subjective and actual values can 
  only be determined in a sales transaction. The valuations have been 
  prepared by JLL on a consistent basis at each reporting date. 
 
 Subsequent expenditure is added to the asset's carrying amount only 
  when it is probable that future economic benefits associated with the 
  item will flow to the Group and the cost of the item can be measured 
  reliably. Repairs and maintenance costs are charged to the consolidated 
  statement of comprehensive income during the financial period in which 
  they are incurred. Changes in fair values are recorded in the consolidated 
  statement of comprehensive income for the year. 
 
 Purchases and sales of investment properties are recognised on legal 
  completion. 
 
 An investment property is derecognised upon disposal or when the investment 
  property is permanently withdrawn from use and no future economic benefits 
  are expected from the disposal. Any gain or loss arising on derecognition 
  of the property (calculated as the difference between the net disposal 
  proceeds and the carrying amount of the asset, where the carrying amount 
  is the higher of cost or fair value) is included in the consolidated 
  statement of comprehensive income in the period in which the property 
  is derecognised. 
 
 2.13 Current assets held for sale - investment property 
 Current assets (and disposal groups) classified as held for sale are 
  measured at the most recent valuation. 
 
 Current assets (and disposal groups) are classified as held for sale 
  if their carrying amount will be recovered through a sale transaction 
  rather than through continuing use. This condition is regarded as met 
  only when the sale is highly probable and the asset (or disposal group) 
  is available for immediate sale in its present condition. Management 
  must be committed to the sale which should be expected to qualify for 
  recognition as a completed sale within one year from the date of classification. 
 
 The Group will recognise an asset in this category once the Board has 
  committed the sale of an asset and marketing has commenced. 
 
 When the Group is committed to a sale plan involving loss of control 
  of a subsidiary, all of the assets and liabilities of that subsidiary 
  are classified as held for sale when the criteria described above are 
  met, regardless of whether the Group will retain a non-controlling interest 
  in its former subsidiary after the sale. 
 
 If an asset held for sale is unsold within one year of being classified 
  as such, it will continue to be classified as held for sale if: 
 
 (a) at the date the Company commits itself to a plan to sell a non-current 
  asset (or disposal group) it reasonably expects that others (not a buyer) 
  will impose conditions on the transfer of the asset that will extend 
  the period required to complete the sale, and actions necessary to respond 
  to those conditions cannot be initiated until after a firm purchase 
  commitment is obtained, and a firm purchase commitment is highly probable 
  within one year; 
 
 (b) the Company obtains a firm purchase commitment and, as a result, 
  a buyer or others unexpectedly impose conditions on the transfer of 
  a non-current asset (or disposal group) previously classified as held 
  for sale that will extend the period required to complete the sale, 
  and timely actions necessary to respond to the conditions have been 
  taken, and a favourable resolution of the delaying factors is expected; 
 
 (c) during the initial one-year period, circumstances arise that were 
  previously considered unlikely and, as a result, a non-current asset 
  previously classified as held for sale is not sold by the end of that 
  period, and during the initial one-year period the Company took action 
  necessary to respond to the change in circumstances, and the non-current 
  asset is being actively marketed at a price that is reasonable, given 
  the change in circumstances, and the criteria above are met; 
 (d) otherwise it will be transferred back to investment property. 
 
 2.14 Property, plant and equipment 
 Property, plant and equipment is stated at cost less accumulated depreciation. 
 
 Cost includes the original purchase price of the asset and the costs 
  attributable to bringing the asset to its working condition for its 
  intended use. Depreciation is charged so as to write off the costs of 
  assets to their residual values over their estimated useful lives, on 
  the following basis: 
 
 Equipment, fixtures and vehicles - 4.50% - 25% per annum, straight line. 
 
 The gain or loss arising on the disposal of an asset is determined as 
  the difference between the sales proceeds and the carrying amount of 
  the asset and is recognised in the consolidated statement of comprehensive 
  income. 
 
 
 
 2.15 Borrowing costs 
 Borrowing costs directly attributable to the acquisition, construction 
  or production of qualifying assets, which are assets that necessarily 
  take a substantial period of time to get ready for their intended use 
  or sale, are added to the cost of those assets, until such time as the 
  assets are substantially ready for their intended use or sale. 
 
 All other borrowing costs are recognised in the consolidated statement 
  of comprehensive income in the period in which they are incurred. 
 
 2.16 Tenants deposits 
 Tenants deposits are held off the consolidated statement of financial 
  position in a separate bank account in accordance with German legal 
  requirements, and the funds are not accessible to the Group. Accordingly, 
  neither an asset nor a liability is recognised. 
 
 2.17 Financial Instruments under IFRS 9 
 The Company has applied IFRS 9 from 1 January 2018 but as explained 
  in note 2.19 has not restated comparatives on initial application. The 
  classification and measurement policies adopted by the Company are explained 
  in note 2.19, but the detailed policies for each class of instrument 
  is as follows: 
 
 Trade and other receivables 
 Trade receivables are amounts due from tenants for rents and service 
  charges and are initially recognised at the amount of the consideration 
  that is unconditional and subsequently carried at amortised cost as 
  the Group's business model is to collect the contractual cash flows 
  due from tenants. Provision is made based on the expected credit loss 
  model which reflects on the Company's historical credit loss experience 
  over the past three years but also reflects the lifetime expected credit 
  loss. 
 
 Cash and cash equivalents 
 Cash and cash equivalents are defined as cash and short term deposits, 
  including any bank overdrafts, with an original maturity of three months 
  or less, measured at amortised cost. 
 
 Trade and other payables 
 Trade payables are recognised and carried at their invoiced value inclusive 
  of any VAT that may be applicable, and subsequently at amortised cost 
  using the effective interest model. 
 
 Borrowings 
 All loans and borrowings are initially measured at fair value less directly 
  attributable transaction costs. After initial recognition, all interest-bearing 
  loans and borrowings are subsequently measured at amortised cost, using 
  the effective interest method. 
 
 The interest due within the next twelve months is accrued at the end 
  of the year and presented as a current liability within trade and other 
  payables. 
 
 The Company has applied IFRS 9 retrospectively, but has elected not 
  to restate comparative information. As a result the comparative information 
  continues to be accounted for in accordance with the Company's previous 
  accounting policies as set out below. 
 
 Financial instruments - accounting policies applied until 31 December 
  2017 
 
 Financial assets and financial liabilities are recognised in the Group's 
  consolidated statement of financial position when the Group becomes 
  party to the contractual provisions of the instrument. Financial assets 
  are derecognised when the contractual rights to the cash flows from 
  the financial asset expire or when the contractual rights to those assets 
  are transferred. Financial liabilities are derecognised when the obligation 
  specified in the contract is discharged, cancelled or expired. 
 
 The Group classifies its financial assets as held at fair value through 
  profit or loss, or measured at amortised cost. The classification depends 
  on the purpose for which the financial assets were acquired, and is 
  determined at initial recognition. 
 
 (a) Financial assets at fair value through profit or loss ('FVTPL') 
 Financial assets are classified as FVTPL when the financial asset is 
  designated as FVTPL. A financial asset may be designated as FVTPL upon 
  initial recognition if: 
 -- such designation eliminates or significantly reduces a measurement 
  or recognition inconsistency that would otherwise arise; or 
 -- the financial asset forms part of a group of financial assets or 
  financial liabilities, or both, which is managed and its performance 
  is evaluated on a fair value basis, in accordance with the Group's documented 
  risk management strategy, and information about the grouping is provided 
  internally on that basis. 
 
 Financial assets at FVTPL are stated at fair value, with any gains or 
  losses arising on re-measurement recognised in the consolidated statement 
  of comprehensive income. Fair value is determined in the manner described 
  in note 32. 
 
 (b) Financial assets measured at amortised cost 
 The Group's financial assets measured at amortised cost comprise trade 
  and other receivables and cash and cash equivalents. Loans and receivables 
  are recognised initially at fair value and subsequently at amortised 
  cost using the effective interest method. 
 
 (i) Trade and other receivables 
 Trade and other receivables are recognised initially at fair value and 
  subsequently measured at amortised cost using the effective interest 
  method less provision for impairment. Appropriate provisions for estimated 
  irrecoverable amounts are recognised in the consolidated statement of 
  comprehensive income when there is objective evidence that the assets 
  are impaired. Interest income is recognised by applying the effective 
  interest rate, except for short-term trade and other receivables when 
  the recognition of interest would be immaterial. 
 
 Service charges receivable and payable from tenants are presented gross 
  as assets and liabilities separately. 
 
 Impairment provisions are recognised when there is objective evidence 
  (such as significant financial difficulties on the part of the counterparty 
  or default or significant delay in payment) that the Group will be unable 
  to collect all of the amounts due. For trade and other receivables, 
  which are reported net, such provisions are recorded in a separate allowance 
  account with the loss being recognised within property expenses in the 
  consolidated statement of comprehensive income. On confirmation that 
  the trade and other receivables will not be collectable, the gross carrying 
  value of the asset is written off against the associated provision. 
 
 (ii) Cash and cash equivalents 
 Cash and cash equivalents comprise cash in hand, cash at agents, demand 
  deposits, and other short-term highly liquid investments that have maturities 
  of three months or less from inception, are readily convertible to a 
  known amount of cash and are subject to an insignificant risk of changes 
  in value. 
 
 (c) Equity instruments 
 An equity instrument is any contract that evidences a residual interest 
  in the assets of an entity after deducting all of its liabilities. Equity 
  instruments issued by the Group are recorded at the proceeds received, 
  net of direct issue costs. 
 
 (d) Trade and other payables 
 Trade payables are initially measured at their fair value and are subsequently 
  measured at their amortised cost using the effective interest method; 
  this method allocates interest expense over the relevant period by applying 
  the 'effective interest rate' to the carrying amount of the liability. 
 
 (e) Borrowings 
 Borrowings are recognised initially at fair value, net of transaction 
  costs incurred. Borrowings are subsequently stated at amortised cost; 
  any difference between the proceeds (net of transaction costs) and the 
  redemption value is recognised in the consolidated statement of comprehensive 
  income over the period of the borrowings using the effective interest 
  method. 
 
 2.18 Current and deferred income tax 
 The tax expense for the period comprises current and deferred tax. Tax 
  is recognised in the consolidated statement of comprehensive income, 
  except to the extent that it relates to items recognised in other comprehensive 
  income or directly in equity. In that case, the tax is also recognised 
  in other comprehensive income or directly in equity, respectively. 
 
 (a) Current tax 
 The current tax charge is based on taxable profit for the year. Taxable 
  profit differs from net profit reported in the consolidated statement 
  of comprehensive income because it excludes items of income or expense 
  that are taxable or deductible in other years and it further excludes 
  items that are never taxable or deductible. The Group's liability for 
  current tax is calculated using tax rates that have been enacted or 
  substantively enacted by the accounting date. 
 
 (b) Deferred tax 
 Deferred tax is the tax expected to be payable or recoverable on differences 
  between the carrying amounts of assets and liabilities in the financial 
  statements and the corresponding tax bases used in the computation of 
  taxable profit. Deferred tax assets are recognised to the extent that 
  it is probable that taxable profits will be available against which 
  deductible temporary differences can be utilised. 
 
 Deferred tax is charged or credited in the consolidated statement of 
  comprehensive income except when it relates to items credited or charged 
  directly in equity, in which case the deferred tax is also dealt with 
  in equity. 
 
 Deferred tax is calculated at the tax rates and laws that are expected 
  to apply to the period when the asset is realised or the liability is 
  settled based upon tax rates that have been enacted or substantively 
  enacted by the accounting date. 
 
 The carrying amount of deferred tax assets is reviewed at each accounting 
  date and reduced to the extent that it is no longer probable that sufficient 
  taxable profits will be available to allow all or part of the asset 
  to be recovered. 
 
 2.19 New standards and interpretations 
 The following relevant new standards, amendments to standards and interpretations 
  have been issued, and are effective for the financial year beginning 
  on 1 January 2018, as adopted by the European Union: 
 
 Title                                       As issued by the IASB, mandatory for 
                                              accounting periods starting on or 
                                              after 
 
 IFRS 9 - Financial Instruments              Accounting periods beginning on or 
                                              after 1 January 2018 
 IFRS 15 - Revenue from Contracts            Accounting periods beginning on or 
  with Customers                              after 1 January 2018 
 IFRIC 22 - Foreign currency transactions    Accounting periods beginning on or 
  and advance consideration                   after 1 January 2018 
 
 IFRS 9 -The Company has applied IFRS 9 from 1 January 2018 but will 
  not restate comparatives on initial application. 
 
 The Company has reviewed its financial assets and liabilities and the 
  impact from the adoption of the new standard is as follows: 
 
 (i) Classification and measurement 
 IFRS 9 contains three principal classification categories for financial 
  assets: measured at amortised cost, fair value through profit and loss 
  and fair value through other comprehensive income. The Company's financial 
  assets at 31 December 2018 consist primarily of trade receivables, including 
  service charges, and other financial assets which will continue to be 
  reflected at amortised cost. Trade receivables are classified as at 
  amortised cost as they meet the test of Solely Payments of Principal 
  and Interest ("SPPI test") as the Group's model is to collect the contracted 
  cash flows due from tenants. There was no impact in respect of classification 
  and measurement of financial liabilities under IFRS 9. 
 
 (ii) Impairment 
 The new impairment model requires the recognition of impairment provisions 
  based on expected credit losses rather than only on incurred losses 
  as was the case under lAS 39. It is therefore no longer necessary for 
  a credit event to have occurred before credit losses are recognised. 
  IFRS 9 requires a simplified approach for measuring the loss allowance 
  at an amount equal to lifetime expected credit losses ("ECLs") for trade 
  receivables without a significant financing component. 
 
 The main area of focus to the Company is considered to be impairment 
  provisioning of trade receivables. Other financial assets are also subject 
  to the expected credit loss model. 
 
 Gross trade receivables held at 31 December 2018 were EUR1.0 million 
  (2017: EUR0.3 million) with an impairment provision recognised of EUR0.2 
  million (2017: EUR0.3 million). The credit risk associated with unpaid 
  rent is deemed low. 
 
 We have performed an assessment of the impact of impairment losses recognised 
  for trade receivables under IFRS 9 at 31 December 2018 through estimating 
  the expected credit loss based on actual credit loss experienced over 
  the past three years and taking into consideration future expected losses. 
  Based on this assessment, there was no material impact of impairment 
  losses recognised under IFRS 9. 
 
 The impact of non-substantial debt modifications has been reviewed and 
  there is no material impact on the financial statements at transition. 
 
 IFRS 15 - The Company has contracts which include both an operating 
  lease and a service, i.e. rental of space and service charges. The contracts 
  do not separate the operating lease component as the accounting for 
  operating lease income and a service/supply arrangement is similar. 
  Under IFRS 16, lessors are required to account for the lease and non-lease 
  components of a contract separately. In the case of non-lease components 
  such as service charges, this must be accounted for under IFRS 15. The 
  Company recognises the rental income over the duration of the life of 
  the contract and recognising the service charge component as incurred. 
 
 The following relevant new standards, amendments to standards and interpretations 
  have been issued, but are not effective for the financial year beginning 
  on 1 January 2018, as adopted by the European Union, and have not been 
  early adopted: 
 
 Title                                       As issued by the IASB, mandatory for 
                                              accounting periods starting on or 
                                              after 
 
 IFRS 16 Leases                              Accounting periods beginning on or 
                                              after 1 January 2019 
 
 The Directors have considered that the adoption of this standard in 
  future periods will have no material impact on the consolidated financial 
  statements of the Group. The impact of IFRS 16 removes the differentiation 
  between financial and operational leases with regard to the Lessee party. 
  As the Group is the lessor in their contractual arrangements IFRS 16's 
  approach is substantially unchanged from its predecessor, IAS 17. 
 
 The following standards have been issued by the IASB but have not yet 
  been adopted by the EU: 
 
 Title                                       As issued by the IASB, mandatory for 
                                              accounting periods starting on or 
                                              after 
 
 IFRIC 23 - Uncertainty over Income          Accounting periods beginning on or 
  Tax Treatments                              after 1 January 2019 
 Prepayment Features with Negative           Accounting periods beginning on or 
  Compensation (Amendments to IFRS            after 1 January 2019 
  9) 
 Long Term Interests in Associates           Accounting periods beginning on or 
  and Joint Ventures (Amendments to           after 1 January 2019 
  IAS 28) 
 Annual Improvements to IFRS Standards       Accounting periods beginning on or 
  2015-2017 Cycle                             after 1 January 2019 
 Plan Amendment, Curtailment or Settlement   Accounting periods beginning on or 
  (Amendments to IAS 19)                      after 1 January 2019 
 Amendments to References to the             Accounting periods beginning on or 
  Conceptual Framework in IFRS Standards      after 1 January 2020 
 IFRS 17 - Insurance Contracts               Accounting periods beginning on or 
                                              after 1 January 2021 
 
 While the above standards have not yet been adopted by the EU, the Group 
  is currently assessing their impact. 
 
 3. Financial risk management 
 
 3.1 Financial risk factors 
 The Group's activities expose it to a variety of financial risks: market 
  risk, credit risk and liquidity risk. The Group's overall risk management 
  programme focuses on the unpredictability of financial markets and seeks 
  to minimise potential adverse effects on the Group's financial performance. 
 
 Risk management is carried out by the Risk Committee (previously the 
  Audit and Risk Committee up to 17 April 2018) under policies approved 
  by the Board of Directors. The Board provides principles for overall 
  risk management, as well as policies covering specific areas, such as 
  interest rate risk, credit risk and investment of excess liquidity. 
 
 3.2 Market risk 
 Market risk is the risk of loss that may arise from changes in market 
  factors such as foreign exchange rates, interest rates and general property 
  market risk. 
 
 (a) Foreign exchange risk 
 The Group operates in Germany and is exposed to foreign exchange risk 
  arising from currency exposures, primarily with respect to Sterling 
  against the Euro arising from the costs which are incurred in Sterling. 
  Foreign exchange risk arises from future commercial transactions, and 
  recognised monetary assets and liabilities denominated in currencies 
  other than the Euro. 
 
 The Group's policy is not to enter into any currency hedging transactions. 
 
 (b) Interest rate risk 
 The Group has exposure to interest rate risk. It has external borrowings 
  at a number of different variable interest rates. The Group is also 
  exposed to interest rate risk on some of its financial assets, being 
  its cash at bank balances. Details of actual interest rates paid or 
  accrued during each period can be found in note 23 to the consolidated 
  financial statements. 
 
 The Group's policy is to manage its interest rate risk by entering into 
  a suitable hedging arrangement, either caps or swaps, in order to limit 
  exposure to borrowings at variable rates. 
 
 (c) General property market risk 
 Through its investment in property, the Group is subject to other risks 
  which can affect the value of property. The Group seeks to minimise 
  the impact of these risks by review of economic trends and property 
  markets in order to anticipate major changes affecting property values. 
 
 3.3 Credit risk 
 The risk of financial loss due to counterparty's failure to honour their 
  obligations arises principally in connection with property leases and 
  the investment of surplus cash. 
 The Group has policies in place to ensure that rental contracts are 
  made with customers with an appropriate credit history. Tenant rent 
  payments are monitored regularly and appropriate action taken to recover 
  monies owed, or if necessary, to terminate the lease. 
 
 Cash transactions are limited to financial institutions with a high 
  credit rating. 
 
 3.4 Liquidity risk 
 The Group's objective is to maintain a balance between continuity of 
  funding and flexibility through the use of bank loans secured on the 
  Group's properties. The terms of the borrowings entitle the lender to 
  require early repayment should the Group be in default with significant 
  payments for more than one month. 
 
 3.5 Capital management 
 The prime objective of the Group's capital management is to ensure that 
  it maintains the financial flexibility needed to allow for value-creating 
  investments as well as healthy balance sheet ratios. 
 
 The capital structure of the Group consists of net debt (borrowings 
  disclosed in note 23 after deducting cash and cash equivalents) and 
  equity of the Group (comprising stated capital, reserves and retained 
  earnings). 
 
 When reviewing the capital structure the Group considers the cost of 
  capital and the risks associated with each class of capital. The Group 
  reviews the gearing ratio which is determined as the proportion of net 
  debt to equity. In comparison with comparable companies operating within 
  the property sector the Board considers the gearing ratios to be reasonable. 
 
 The gearing ratios for the reporting periods are as follows: 
                                                                                                As at                      As at 
                                                                                          31 December                31 December 
                                                                                                 2018                       2017 
                                                                                              EUR'000                    EUR'000 
 
 Borrowings                                                                                 (195,274)                  (222,294) 
 Cash and cash equivalents                                                                     26,868                     27,182 
 Net debt                                                                                   (168,406)                  (195,112) 
                                                                                =====================   ======================== 
 
 Equity                                                                                       409,847                    367,942 
 Net debt to equity ratio                                                                         41%                        53% 
                                                                                =====================   ======================== 
 
 4. Critical accounting estimates and judgements 
 The preparation of consolidated financial statements in conformity with 
  IFRS requires the Group to make certain critical accounting estimates 
  and judgements. In the process of applying the Group's accounting policies, 
  management has decided the following estimates and assumptions have 
  a significant risk of causing a material adjustment to the carrying 
  amounts of assets and liabilities within the financial year; 
 
 i) Estimate of fair value of investment properties 
 The best evidence of fair value is current prices in an active market 
  of investment properties with similar leases and other contracts. In 
  the absence of such information, the Group determines the amount within 
  a range of reasonable fair value estimates. In making its judgement, 
  the Group considers information from a variety of sources, including: 
 
 a) Discounted cash flow projections based on reliable estimates of future 
  cash flows, derived from the terms of any existing lease and other contracts, 
  and (where possible) from external evidence such as current market rents 
  for similar properties in the same location and condition, and using 
  discount rates that reflect current market assessments of the uncertainty 
  in the amount and timing of the cash flows. 
 
 b) Current prices in an active market, and its third party independent 
  experts, for properties of different nature, condition or location (or 
  subject to different lease or other contracts), adjusted to reflect 
  those differences. 
 
 c) Recent prices of similar properties in less active markets, with 
  adjustments to reflect any changes in economic conditions since the 
  date of the transactions that occurred at those prices. 
 
 The Directors remain ultimately responsible for ensuring that the valuers 
  are adequately qualified, competent and base their results on reasonable 
  and realistic assumptions. The Directors have appointed JLL as the real 
  estate valuation experts who determine the fair value of investment 
  properties using recognised valuation techniques and the principles 
  of IFRS 13. Further information on the valuation process can be found 
  in note 17. 
 
 ii) Judgment in relation to the recognition of assets held for sale 
 Management has assumed the likelihood of investment properties - held 
  for sale, being sold within 12 months, in accordance with the requirement 
  of IFRS 5. Management considers that based on historical and current 
  experience that the properties can be reasonably expected to sell within 
  12 months. 
 
 iii) Judgment in recognition of the property advisor performance fee 
 The new property advisor performance fee agreement is effective only 
  from 1 January 2019 and the fee arising under the prior agreement for 
  the year ended 31 December 2018 was waived. 
 
 The performance fee is based on performance since 1 July 2018 and the 
  directors judge it to be appropriate to recognise a charge in the year 
  to reflect the services provided. 
 
 5. Segmental information 
 Information reported to the Board of Directors, which is the chief operating 
  decision maker, for the purposes of resource allocation and assessment 
  of segment performance is focussed on the different revenue streams 
  that exist within the Group. The Group's principal reportable segments 
  under IFRS 8 are therefore as follows: 
 
 - Residential 
 - Commercial 
 
 All revenues are earned in Germany with property and administrative 
  expenses incurred in Jersey, Germany and Guernsey. 
 
 31 December 2017 
 
 
                                               Residential         Commercial             Unallocated                      Total 
                                                   EUR'000            EUR'000                 EUR'000                    EUR'000 
 Investment property                               444,488             57,872                       -                    502,360 
 Loans and receivables                                   -                  -                   2,323                      2,323 
 Investment properties - held for sale              94,582             12,315                       -                    106,897 
 Other assets                                       33,366              4,344                      92                     37,802 
 Liabilities                                     (265,020)            (7,843)                 (8,577)                  (281,440) 
 Net assets                                        307,416             66,688                 (6,162)                    367,942 
                                                ==========   ================   =====================   ======================== 
 
 Revenue (restated - see note 2.2)                  20,941              2,726                       -                     23,667 
 Property expenses (restated - see 
  note 2.2)                                       (11,137)            (1,450)                       -                   (12,587) 
 Administrative expenses                                 -                  -                 (2,967)                    (2,967) 
 Gain on disposal of investment property             5,319                  -                       -                      5,319 
 Investment property fair value gain               139,245             18,129                       -                    157,374 
 Performance fee                                         -                  -                (26,339)                   (26,339) 
 Operating profit                                  154,368             19,405                (29,306)                    144,467 
                                                ----------   ----------------   ---------------------   ------------------------ 
 Net finance charge                                                                                                      (5,995) 
 Income tax expense                                                                                                     (26,150) 
 Profit for the year                                                                                                     112,322 
                                                                                                        ======================== 
 
 31 December 2018 
                                               Residential         Commercial             Unallocated                      Total 
                                                   EUR'000            EUR'000                 EUR'000                    EUR'000 
 Investment properties                             560,019             72,914                       -                    632,933 
 Other financial assets at amortised 
  cost                                                   -                  -                   2,406                      2,406 
 Investment properties - held for sale              11,279              1,468                       -                     12,747 
 Other assets                                       31,275              4,072                      88                     35,435 
 Liabilities                                     (253,998)           (11,154)                 (8,522)                  (273,674) 
 Net assets                                        348,575             67,300                 (6,028)                    409,847 
                                                ==========   ================   =====================   ======================== 
 
 Revenue                                            20,068              2,613                       -                     22,681 
 Property expenses                                (13,947)            (1,816)                       -                   (15,763) 
 Administrative expenses                                 -                  -                 (3,194)                    (3,194) 
 Gain on disposal of investment property             1,026                  -                       -                      1,026 
 Investment property fair value gain                58,526              7,620                       -                     66,146 
 Performance fee                                         -                  -                 (4,010)                    (4,010) 
 Separately disclosed items                              -                  -                   (966)                      (966) 
 Operating profit                                   65,673              8,417                 (8,170)                     65,920 
                                                ----------   ----------------   ---------------------   ------------------------ 
 Net finance charge                                                                                                      (9,491) 
 Income tax expense                                                                                                     (11,071) 
 Profit for the year                                                                                                      45,358 
                                                                                                        ======================== 
 
 6. Revenue 
                                                                                          31 December                31 December 
                                                                                                 2018                       2017 
                                                                                                                       (restated 
                                                                                                                           - see 
                                                                                                                            note 
                                                                                                                            2.2) 
                                                                                              EUR'000                    EUR'000 
 
 Rental income                                                                                 17,508                     18,080 
 Service charge income                                                                          5,173                      5,587 
                                                                                               22,681                     23,667 
                                                                                =====================   ======================== 
 
 The total future aggregated minimum rentals receivable under non-cancellable 
  operating leases are as follows: 
 
                                                                                          31 December                31 December 
                                                                                                 2018                       2017 
                                                                                              EUR'000                    EUR'000 
 
 Not later than one year                                                                          435                        904 
 Later than one year but not later than five years                                              2,468                      3,364 
 Later than five years                                                                          2,701                      1,398 
                                                                                                5,604                      5,666 
                                                                                =====================   ======================== 
 
 Revenue comprises rental income earned from residential and commercial 
  property in Germany. There are no individual tenants that account for 
  greater than 10% of revenue during any of the reporting periods. 
 
 The leasing arrangements for residential property are with individual 
  tenants, with one month notice for cancellation of the lease in most 
  cases. 
 
 The commercial leases are non-cancellable, with an average lease period 
  of 3 years. 
 
 7. Property expenses 
                                                                                          31 December                31 December 
                                                                                                 2018                       2017 
                                                                                                                       (restated 
                                                                                                                           - see 
                                                                                                                            note 
                                                                                                                            2.2) 
                                                                                              EUR'000                    EUR'000 
 
 Property management expenses                                                                   1,024                      1,079 
 Repairs and maintenance                                                                        1,710                      1,433 
 Impairment charge - trade receivables                                                             29                         41 
 Other property expenses                                                                        7,053                      5,825 
 Property advisors' fees and expenses                                                           5,947                      4,209 
                                                                                               15,763                     12,587 
                                                                                =====================   ======================== 
 
 8. Administrative expenses 
                                                                                          31 December                31 December 
                                                                                                 2018                       2017 
                                                                                              EUR'000                    EUR'000 
 
 Secretarial & administration fees                                                                880                        901 
 Legal & professional fees                                                                      1,160                      1,045 
 Directors' fees                                                                                  300                        148 
 Audit and accountancy fees                                                                       840                        894 
 Bank charges                                                                                      54                         56 
 Loss on foreign exchange                                                                         133                         20 
 Depreciation                                                                                      16                         23 
 Other income                                                                                   (189)                      (120) 
                                                                                                3,194                      2,967 
                                                                                =====================   ======================== 
 
 Key management compensation - the functions of management are undertaken 
  by external providers of professional services, as set out in note 33. 
 
 Further details of the Directors' fees are set out in the Directors' 
  Remuneration Report on page 49 and in note 12 below. 
 
 9. Auditor's remuneration 
 An analysis of the fees charged by the auditor and its associates is 
  as follows: 
                                                                                          31 December                31 December 
                                                                                                 2018                       2017 
                                                                                              EUR'000                    EUR'000 
 
 Fees payable to the Group's auditor and its associates 
  for the audit of the consolidated financial statements:                                         188                        176 
 
 Fees payable to the Group's auditor and its associates for other services: 
 - Corporate finance                                                                                -                         26 
 - Audit-related assurance services                                                                27                         24 
 - Other                                                                                            8                          - 
                                                                                                  223                        226 
                                                                                =====================   ======================== 
 
 10. Gain on disposal of investment property (including investment property 
  held for sale) 
                                                                                          31 December                31 December 
                                                                                                 2018                       2017 
                                                                                              EUR'000                    EUR'000 
 
 Net proceeds                                                                                  86,959                     61,652 
 Book value of disposals                                                                     (84,995)                   (55,117) 
 Disposal costs                                                                                 (938)                    (1,216) 
                                                                                                1,026                      5,319 
                                                                                =====================   ======================== 
 
 Where there has been a partial disposal of a property, the net book 
  value of the asset sold is calculated on a per square metre rate, based 
  on the prior period or interim valuation. 
 
 11. Investment property fair value gain 
                                                                                          31 December                31 December 
                                                                                                 2018                       2017 
                                                                                              EUR'000                    EUR'000 
 
 Investment property fair value gain                                                           66,146                    157,374 
                                                                                =====================   ======================== 
 
 Further information on investment properties is shown in note 17. 
 
 12. Separately disclosed items 
 These relate to legal and professional fees incurred during a significant 
  transaction which was considered by the Board but not pursued totalling 
  EUR966,000 (December 2017: EURnil). 
 
 As part of this transaction, significant demands were made on the Directors' 
  time. It was agreed that these requirements were far in excess of the 
  Directors' contracted obligations and that a sum up to or equal to their 
  annual salary could be billed for their time and effort. Directors fees 
  relating to the above totalled GBP52,691. These additional fees have 
  been included within the total Directors' fees expense as detailed in 
  note 8. 
 
 13. Net finance charge 
                                                                                          31 December                31 December 
                                                                                                 2018                       2017 
                                                                                              EUR'000                    EUR'000 
 
 Interest income                                                                                 (54)                      (116) 
 Interest from partners' loans                                                                   (83)                       (57) 
 Loss / (gain) on interest rate swap                                                            2,658                    (1,535) 
 Interest payable on bank borrowings                                                            5,118                      5,080 
 Finance arrangement fee amortisation                                                             381                        550 
 Finance charge on redemption liability                                                         1,471                      2,073 
                                                                                                9,491                      5,995 
                                                                                =====================   ======================== 
 
 14. Income tax expense 
                                                                                          31 December                31 December 
                                                                                                 2018                       2017 
 The tax charge for the period is as follows:                                                 EUR'000                    EUR'000 
 
 Current tax charge                                                                             3,151                      2,940 
 Adjustment in respect of prior year                                                                -                          - 
 Deferred tax charge - origination and reversal of temporary 
  differences                                                                                   7,920                     23,210 
                                                                                               11,071                     26,150 
                                                                                =====================   ======================== 
 
 The tax charge for the year can be reconciled to the theoretical tax 
  charge on the profit in the income statement as follows: 
 
                                                                                          31 December                31 December 
                                                                                                 2018                       2017 
                                                                                              EUR'000                    EUR'000 
 
 Profit before tax on continuing operations                                                    56,429                    138,472 
 
 Tax at German income tax rate of 15.8% (2017: 15.8%)                                           8,916                     21,879 
 Income not taxable                                                                             (162)                      (840) 
 Losses carried forward not recognised                                                          2,317                      5,111 
 Total tax charge for the year                                                                 11,071                     26,150 
                                                                                =====================   ======================== 
 
 Reconciliation of current tax liabilities 
                                                                                          31 December                31 December 
                                                                                                 2018                       2017 
                                                                                              EUR'000                    EUR'000 
 
 Balance at beginning of year                                                                   2,914                         24 
 Tax paid during the year                                                                     (4,678)                       (50) 
 Current tax charge                                                                             3,151                      2,940 
 Balance at end of year                                                                         1,387                      2,914 
                                                                                =====================   ======================== 
 
 Reconciliation of deferred tax 
                                                                      Capital                Interest 
                                                                     gains on              rate swaps 
                                                                   properties                                              Total 
                                                                      EUR'000                 EUR'000                    EUR'000 
                                                                (Liabilities)                   Asset          (Net liabilities) 
 Balance at 1 January 2017                                           (22,150)                     770                   (21,380) 
 
 Charged to the statement of comprehensive 
  income                                                             (22,967)                   (243)                   (23,210) 
 Deferred tax (liability) / asset at 31 December 
  2017                                                               (45,117)                     527                   (44,590) 
 
 Charged to the statement of comprehensive 
  income                                                              (8,341)                     421                    (7,920) 
 Deferred tax (liability) / asset at 31 December 
  2018                                                               (53,458)                     948                   (52,510) 
                                                             ================   =====================   ======================== 
 
 Jersey income tax 
 The Group is liable to Jersey income tax at 0%. 
 
 Guernsey income tax 
 The Group is liable to Guernsey income tax at 0%. 
 
 German tax 
 As a result of the Group's operations in Germany, the Group is subject 
  to German Corporate Income Tax ('CIT') - the effective rate for Phoenix 
  Spree Deutschland Limited for 2018 was 15.8% (2017: 15.8%). 
 
 Factors affecting future tax charges 
 The Group has accumulated tax losses of approximately EUR17.6 million 
  (2017: EUR18.1 million) in Germany, which will be available to set against 
  suitable future profits should they arise, subject to the criteria for 
  relief. No deferred tax asset is recognised in respect of losses of 
  EUR2.8 million (2017: EUR2.9 million) as there is insufficient certainty 
  the losses can be utilised by Group entities. 
 
 
 15. Dividends 
                                                                                          31 December                31 December 
                                                                                                 2018                       2017 
                                                                                              EUR'000                    EUR'000 
 
 Amounts recognised as distributions to equity holders in the period: 
 Interim dividend for the year ended 31 December 2018 
  of EUR2.35 cents (2.1p) (2017: EUR1.9 cents (1.6p)) 
  per share                                                                                     2,420                      2,079 
 Proposed final dividend for the year ended 31 December 
  2018 of EUR5.15 cents (4.62p) (2017: EUR5.0 cents (4.4p)) 
  per share                                                                                     5,189                      5,038 
                                                                                =====================   ======================== 
 
 The proposed final dividend is subject to approval by shareholders at 
  the Annual General Meeting and has not been included as a liability 
  in these consolidated financial statements. The proposed dividend is 
  payable to all shareholders on the Register of Members on 7 June 2019. 
  The total estimated dividend to be paid is 4.62p per share. The payment 
  of this dividend will not have any tax consequences for the Group. 
 
 16. Subsidiaries 
 
 The Group consists of a Parent Company, Phoenix Spree Deutschland Limited, 
  incorporated in Jersey, Channel Islands and a number of subsidiaries 
  held directly by Phoenix Spree Deutschland Limited, which are incorporated 
  in and operated out of Jersey, Guernsey and Germany. 
 
 Further details are given below: 
 
 
                                   Country of incorporation                                                                 Nature 
                                                                                            % holding                  of business 
                                                                                                                      Investment 
 Phoenix Spree Deutschland I Limited                 Jersey               100                     100                   property 
                                                                                                                      Investment 
 Phoenix Spree Deutschland II Limited                Jersey               100                     100                   property 
                                                                                                                      Investment 
 Phoenix Spree Deutschland III Limited               Jersey               100                     100                   property 
                                                                                                                      Investment 
 Phoenix Spree Deutschland IV Limited                Jersey               100                     100                   property 
                                                                                                                      Investment 
 Phoenix Spree Deutschland V Limited                 Jersey               100                     100                   property 
                                                                                                                      Investment 
 Phoenix Spree Deutschland VII Limited               Jersey               100                     100                   property 
                                                                                                                      Investment 
 Phoenix Spree Deutschland IX Limited                Jersey               100                     100                   property 
                                                                                                                         Finance 
 Phoenix Spree Deutschland X Limited                 Jersey               100                     100                    vehicle 
                                                                                                                      Investment 
 Phoenix Spree Deutschland XI Limited                Jersey               100                     100                   property 
                                                                                                                      Investment 
 Phoenix Spree Deutschland XII Limited               Jersey               100                     100                   property 
                                                                                                                         Holding 
 Phoenix Property Holding GmbH & Co.KG              Germany               100                     100                    Company 
 Phoenix Spree Mueller GmbH (formerly                                                                                 Investment 
  Laxpan Mueller GmbH)                              Germany              94.9                    94.9                   property 
 Phoenix Spree Gottlieb GmbH (formerly                                                                                Investment 
  Invador Grundbesitz GmbH)                         Germany              94.9                    94.9                   property 
                                                                                                                         Holding 
 PSPF Holdings GmbH                                 Germany               100                     100                    Company 
                                                                                                                      Management 
 PSPF General Manager GmbH (in liquidation)         Germany               100                     100                    of PSPF 
 PSPF Acquisition Vehicle GmbH (in                                                                                   Acquisition 
  liquidation)                                      Germany             99.64                   99.64                    vehicle 
                                                                                                                      Investment 
 PSPF Property GmbH & Co. KG (in liquidation)       Germany                94                      94                   property 
 Phoenix Spree Property Fund Ltd &                                                                                    Investment 
  Co. KG                                            Germany              94.8                    94.8                   property 
                                                                                                                      Management 
 PSPF General Partner (Guernsey) Limited           Guernsey               100                     100                    of PSPF 
 
 The investments in PSPF General Manager GmbH and PSPF Acquisition Vehicle 
  GmbH & Co. KG are all held via the investment is PSPF Holdings GmbH, 
  which was acquired on 7 September 2007. The other subsidiaries are held 
  directly. 
 
 17. Investment properties 
                                                                                                 2018                       2017 
 Fair Value                                                                                   EUR'000                    EUR'000 
 
 At 1 January                                                                                 609,257                    423,799 
 Capital expenditure                                                                            7,943                      6,715 
 Property additions                                                                            47,329                     76,486 
 Disposals                                                                                   (84,995)                   (55,117) 
 Fair value gain                                                                               66,146                    157,374 
                                                                                ---------------------   ------------------------ 
 Investment properties at fair value - as set out in 
  the report by JLL                                                                           645,680                    609,257 
 Assets considered as "Held for Sale" (Note 18)                                              (12,747)                  (106,897) 
 At 31 December                                                                               632,933                    502,360 
                                                                                =====================   ======================== 
 
 The property portfolio was valued at 31 December 2018 by the Group's 
  independent valuers, Jones Lang LaSalle GmbH ('JLL'), in accordance 
  with the methodology described below. The valuations were performed 
  in accordance with the current Appraisal and Valuation Standards, 8th 
  edition (the 'Red Book') published by the Royal Institution of Chartered 
  Surveyors (RICS). 
 
 The valuation is performed on a building-by-building basis and the source 
  information on the properties including current rent levels, void rates 
  and non-recoverable costs was provided to JLL by the Property Advisors 
  PMM Partners (UK) Limited. Assumptions with respect to rental growth, 
  adjustments to non-recoverable costs and the future valuation of these 
  are those of JLL. Such estimates are inherently subjective and actual 
  values can only be determined in a sales transaction. 
 
 Having reviewed the JLL report, the Directors are of the opinion that 
  this represents a fair and reasonable valuation of the properties and 
  have consequently adopted this valuation in the preparation of the consolidated 
  financial statements. 
 
 The valuations have been prepared by JLL on a consistent basis at each 
  reporting date and the methodology is consistent and in accordance with 
  IFRS which requires that the 'highest and best use' value is taken into 
  account where that use is physically possible, legally permissible and 
  financially feasible for the property concerned, and irrespective of 
  the current or intended use. 
 
 All properties are valued as Level 3 measurements under the fair value 
  hierarchy (see note 32) as the inputs to the discounted cash flow methodology 
  which have a significant effect on the recorded fair value are not observable. 
  Additionally, JLL perform reference checks back to comparable market 
  transactions to confirm the valuation model. 
 
 The unrealised fair value gain in respect of investment property is 
  disclosed in the consolidated statement of comprehensive income as 'Investment 
  property fair value gain'. 
 
 Valuations are undertaken using the discounted cash flow valuation technique 
  as described below and with the inputs set out below. 
 
 Discounted cash flow methodology (DCF) 
 The fair value of investment properties is determined using discounted 
  cash flows. 
 
 Under the DCF method, a property's fair value is estimated using explicit 
  assumptions regarding the benefits and liabilities of ownership over 
  the asset's life including an exit or terminal value. As an accepted 
  method within the income approach to valuation the DCF method involves 
  the projection of a series of cash flows on a real property interest. 
  To this projected cash flow series, an appropriate, market-derived discount 
  rate is applied to establish the present value of the income stream 
  associated with the real property. 
 
 The duration of the cash flow and the specific timing of inflows and 
  outflows are determined by events such as rent reviews, lease renewal 
  and related lease up periods, re-letting, redevelopment, or refurbishment. 
  The appropriate duration is typically driven by market behaviour that 
  is a characteristic of the class of real property. 
 
 Periodic cash flow is typically estimated as gross income less vacancy, 
  non-recoverable expenses, collection losses, lease incentives, maintenance 
  cost, agent and commission costs and other operating and management 
  expenses. The series of periodic net operating incomes, along with an 
  estimate of the terminal value anticipated at the end of the projection 
  period, is then discounted. 
 
 The principal inputs to the valuation are as follows: 
 
 
                                                                                           Year ended                 Year ended 
                                                                                          31 December                31 December 
                                                                                                 2018                       2017 
                                                                                                Range                      Range 
 Residential Properties 
 
 Market Rent 
 Rental Value (EUR per sq. p.m.)                                                               7 - 14                      5- 13 
 Stabilised residency vacancy (% per year)                                                          2                          2 
 Tenancy vacancy fluctuation (% per year)                                                        8-10                     8 - 10 
------------------------------------------------------------------------------                          ------------------------ 
 
 Commercial Properties 
 
 Market Rent 
 Rental Value (EUR per sq. p.m.)                                                               4 - 31                     2 - 28 
 Stabilised commercial vacancy (% per year)                                                    0 - 25                     0 - 26 
 Tenancy vacancy fluctuation (% per year)                                                        8-10                         10 
------------------------------------------------------------------------------  ---------------------   ------------------------ 
 
 Estimated Rental Value (ERV) 
 ERV per year per 
  property 
  (EUR'000)                                                                                60 - 1,201                 48 - 1,200 
 ERV (EUR per sq.)                                                                             8 - 14                     5 - 14 
                                                                                ---------------------   ------------------------ 
 
 Financial Rates - blended average 
 Discount rate (%)                                                                                  4                        4.7 
 Portfolio yield (%)                                                                              3.0                        3.5 
                                                                                ---------------------   ------------------------ 
 
 Sensitivity 
 Changes in the key assumptions and inputs to the valuation models used 
  would impact the valuations as follows: 
 
 Vacancy: A change in vacancy by 1% would not materially affect the investment 
  property fair value assessment. 
 
 Rental value: All other factors remaining equal an increase in rental 
  income would increase valuations. Correspondingly, a decrease in rental 
  values would decrease valuations. 
 
 Discount rate: An increase of 0.5% in the discount rate would reduce 
  the investment property fair value by EUR85.9m, and a decrease in the 
  discount rate would increase the investment property fair value by EUR129.9m. 
 
 There are, however, inter-relationships between unobservable inputs 
  as they are determined by market conditions. The existence of an increase 
  of more than one unobservable input could amplify the impact on the 
  valuation. Conversely, changes on unobservable inputs moving in opposite 
  directions could cancel each other out, or lessen the overall effect. 
 
 The Group categorises all investment properties in the following three 
  ways; 
 
 Rental Scenario 
 Where properties have been valued under the "Discounted Cashflow Methodology" 
  and are intended to be held by the Group for the foreseeable future, 
  they are considered valued under the "Rental Scenario" This will equal 
  the "Investment Properties" line in the Non-Current Assets section of 
  the consolidated statement of financial position. 
 
 Condominium scenario 
 Where properties have the potential or the benefit of all relevant permissions 
  required to sell apartments individually (condominiums) then we refer 
  to this as a 'condominium scenario'. Expected sales in the coming year 
  from these assets are considered held for sale under IFRS 5 and can 
  be seen in note 18. The additional value is reflected by using a lower 
  discount rate under the DCF Methodology. Properties which do not have 
  the benefit of all relevant permissions are described as valued using 
  a standard 'rental scenario'. Included in properties valued under the 
  condominium scenario are properties not yet released to held for sale 
  as only a portion of the properties are forecast to be sold in the coming 
  12 months. 
 
 Disposal Scenario 
 Where properties have been notarised for sale prior to the consolidated 
  statement of financial position date, but have not completed; they are 
  held at their notarised disposal value. These assets are considered 
  held for sale under IFRS 5 and can be seen in note 18. 
 
 The table below sets out the assets valued using these 3 scenarios: 
                                                                                          31 December                31 December 
                                                                                                 2018                       2017 
                                                                                              EUR'000                    EUR'000 
 Rental scenario                                                                              619,430                    502,360 
 Condominium scenario                                                                          22,330                     29,847 
 Disposal scenario                                                                              3,920                     77,050 
 Total                                                                                        645,680                    609,257 
                                                                                =====================   ======================== 
 
 The movement in the fair value of investment properties is included 
  in the consolidated statement of comprehensive income as 'gain on disposal 
  of investment property' and comprises: 
                                                                                          31 December                31 December 
                                                                                                 2018                       2017 
                                                                                              EUR'000                    EUR'000 
 Investment properties                                                                         65,717                    155,787 
 Properties held for sale (see note 18)                                                           429                      1,587 
                                                                                               66,146                    157,374 
                                                                                =====================   ======================== 
 
 18. Investment properties - held for sale 
                                                                                                 2018                       2017 
                                                                                              EUR'000                    EUR'000 
 Fair value - held for sale investment properties 
 
 At 1 January                                                                                 106,897                     27,970 
 Transferred from investment properties                                                         5,850                     88,990 
 Transferred (to) investment properties                                                      (15,434)                          - 
 Properties sold                                                                             (84,995)                   (11,650) 
 Valuation gain on apartments held for sale                                                       429                      1,587 
 At 31 December                                                                                12,747                    106,897 
                                                                                =====================   ======================== 
 
 Investment properties are re-classified as current assets and described 
  as 'held for sale' in three different situations: Properties notarised 
  for sale at the reporting date, Properties where at the reporting date 
  the group has obtained and implemented all relevant permissions required 
  to sell individual apartment units, and efforts are being made to dispose 
  of the assets (condominium); and Properties which are being marketed 
  for sale but have currently not been notarised. 
  Properties which no longer satisfy the criteria for recognition as held 
  for sale are transferred back to investment properties at fair value. 
 
 Properties notarised for sale by the reporting date are valued at their 
  disposal price (disposal scenario), and other properties are valued 
  using the condominium or rental scenarios (see note 17) as appropriate. 
  The table below sets out the respective categories: 
                                                                                                 2018                       2017 
                                                                                              EUR'000                    EUR'000 
 Rental scenario                                                                                1,931                          - 
 Condominium scenario                                                                           6,896                     29,847 
 Disposal scenario                                                                              3,920                     77,050 
                                                                                               12,747                    106,897 
                                                                                =====================   ======================== 
 
 Investment properties held for sale are all expected to be sold within 
  12 months of the reporting date based on Management knowledge of current 
  and historic market conditions. While whole properties have been valued 
  under a condominium scenario in note 17, only the expected sales have 
  been transferred to assets held for sale. 
 
 There were liabilities secured on the investment properties held for 
  sale of EUR5.2m (2017: EUR56.9m). 
 
 19. Property, plant and equipment 
                                                                                                                       Equipment 
                                                                                                                         EUR'000 
 Cost or valuation 
 As at 1 January 2017                                                                                                         58 
 Additions                                                                                                                    75 
                                                                                                        ------------------------ 
 As at 31 December 2017                                                                                                      133 
 Additions                                                                                                                    12 
 As at 31 December 2018                                                                                                      145 
                                                                                                        ======================== 
 
 Accumulated depreciation and impairment 
 As at 1 January 2017                                                                                                         18 
 Charge for the year                                                                                                          23 
                                                                                                        ------------------------ 
 As at 31 December 2017                                                                                                       41 
 Charge for the year                                                                                                          16 
 As at 31 December 2018                                                                                                       57 
                                                                                                        ======================== 
 
 Carrying amount 
 As at 31 December 2017                                                                                                       92 
 As at 31 December 2018                                                                                                       88 
                                                                                                        ------------------------ 
 
 20. Other financial assets at amortised cost (2017: Loans and receivables) 
                                                                                          31 December                31 December 
                                                                                                 2018                       2017 
                                                                                              EUR'000                    EUR'000 
 
 At 1 January                                                                                   2,323                      2,253 
 Accrued interest                                                                                  83                         70 
                                                                                --------------------- 
 At 31 December                                                                                 2,406                      2,323 
                                                                                =====================   ======================== 
 
 The above loans have been reclassified to 'Other financial assets at 
  amortised cost' on adoption of IFRS 9, 'financial instruments'. 
 
 The Group entered into loan agreements with Mike Hilton and Paul Ruddle 
  in connection with the acquisition of PSPF. The loans bear interest 
  at 4% per annum, and have a maturity of less than five years. 
 
 The Group also entered into a loan agreement with the minority interest 
  of Accentero Real Estate AG (formerly Blitz B16 - 210 GmbH) in relation 
  to the acquisition of the assets as share deals. This loan bears interest 
  at 3% per annum. 
 
  These assets are considered to have low credit risk and any loss allowance 
  would be immaterial. 
 
 None of the loans and receivables were either past due or impaired in 
  the prior year. 
 
 21. Trade and other receivables 
                                                                                          31 December                31 December 
                                                                                                 2018                       2017 
                                                                                                                       (restated 
                                                                                                                           - see 
                                                                                                                            note 
                                                                                                                            2.2) 
                                                                                              EUR'000                    EUR'000 
 Current 
 Trade receivables                                                                              1,045                        691 
 Less: impairment provision                                                                     (313)                      (342) 
                                                                                ---------------------   ------------------------ 
 Net receivables                                                                                  732                        349 
 Prepayments and accrued income                                                                   549                      6,521 
 Investment property disposal proceeds receivable                                               1,167                      2,232 
 Service charges receivable                                                                     4,766                      5,302 
 Sundry receivables                                                                               317                          - 
                                                                                                7,531                     14,404 
                                                                                =====================   ======================== 
 
 Aging analysis of trade receivables 
                                                                                          31 December                31 December 
                                                                                                 2018                       2017 
                                                                                              EUR'000                    EUR'000 
 
 Up to 12 months                                                                                  731                        344 
 Between 1 year and 2 years                                                                         1                          5 
 Over 3 years                                                                                       -                          - 
                                                                                                  732                        349 
                                                                                =====================   ======================== 
 
 Impairment of trade and service charge receivables 
 The Company calculates lifetime expected credit losses for trade and 
  service charge receivables using a portfolio approach. Receivables are 
  grouped based on the credit terms offered and the type of lease. The 
  probability of default is determined at the year-end based on the aging 
  of the receivables, and historical data about default rates. That data 
  is adjusted if the Company determines that historical data is not reflective 
  of expected future conditions due changes in the nature of its tenants 
  and how they are affected by external factors such as economic and market 
  conditions. 
 
 On this basis, the loss allowance as at 31 December 2018, and on 1 January 
  2018 (the date of adoption of IFRS 9) was determined as set out below. 
  There was no material difference between the loss allowance determined 
  on this basis at 1 January 2018 and on the basis previously used, and 
  therefore there was no re-statement of opening retained earnings required. 
 
 The Company applies the following loss rates to trade and service charge 
  receivables: 
 
 As noted below, a loss allowance of 50% (2017: 50%) has been recognised 
  for trade receivables that are more than 60 days past due. Any receivables 
  where the tenant is no longer resident in the property are provided 
  for in full. 
 
 
                                                      0-60            Over 60             Non-current 
 Trade receivables:                  Aging            days               days                  tenant                 Total 2018 
 Expected loss rate (%)                                 0%                50%                    100% 
 Gross carrying amount (EUR'000)                       582                300                     163                      1,045 
 Loss allowance provision (EUR'000)                      -              (150)                   (163)                      (313) 
 
 
                                                      0-60            Over 60             Non-current                      Total 
 Trade receivables:                  Aging            days               days                  tenant                       2017 
 Expected loss rate (%)                                 0%                50%                    100% 
 Gross carrying amount (EUR'000)                       173                352                     166                        691 
 Loss allowance provision (EUR'000)                      -              (176)                   (166)                      (342) 
 
 Movements in the impairment provision against trade receivables are 
  as follows: 
                                                                                          31 December                31 December 
                                                                                                 2018                       2017 
                                                                                              EUR'000                    EUR'000 
 
 Balance at the beginning of the year                                                             342                        383 
 Impairment losses recognised                                                                     360                        180 
 Amounts written off as uncollectable                                                           (389)                      (221) 
 Balance at the end of the year                                                                   313                        342 
                                                                                =====================   ======================== 
 
 All impairment losses relate to the receivables arising from tenants. 
 
 
 22. Cash and cash equivalents 
                                                                                          31 December                31 December 
                                                                                                 2018                       2017 
                                                                                              EUR'000                    EUR'000 
 
 Cash at bank                                                                                  25,626                     25,518 
 Cash at agents                                                                                 1,242                      1,664 
 Cash and cash equivalents                                                                     26,868                     27,182 
                                                                                =====================   ======================== 
 
 23. Borrowings 
                                                                                          31 December                31 December 
                                                                                                 2018                       2017 
                                                                                              EUR'000                    EUR'000 
 Current liabilities 
 Bank loans - Deutsche Genossenschafts-Hypothekenbank 
  AG                                                                                            2,596                      2,020 
 Bank loans - Berliner Sparkasse                                                                1,046                        626 
                                                                                                3,642                      2,646 
 Non-current liabilities 
 Bank loans - Deutsche Genossenschafts-Hypothekenbank 
  AG                                                                                          122,054                    167,656 
 Bank loans - Berliner Sparkasse                                                               69,578                     51,992 
                                                                                              191,632                    219,648 
 
                                                                                              195,274                    222,294 
                                                                                =====================   ======================== 
 
 All borrowings are secured against the investment properties of the 
  Group. As at 31 December 2018, the Company had EUR1.2m of undrawn debt 
  facilities (2017: EUR0.6 million). A summary of the loans as at the 
  year end is as follows: 
 
                                                                       Amount                Interest 
                                                                                                 rate 
 Bank                                                                 EUR'000                       %                   Maturity 
 Berliner Sparkasse                                                     9,333                    1.72                 31/12/2026 
                                                                        7,696                    1.74                 31/12/2026 
                                                                       12,658                    1.89                 28/02/2027 
                                                                        5,024                    1.93                 31/08/2027 
                                                                        3,519                    1.05                 31/08/2027 
                                                                       10,563                    1.95                 30/11/2027 
                                                                        3,396                    1.09                 30/11/2027 
                                                                       11,910                    2.30                 30/04/2028 
                                                                        6,525                    2.00                 31/12/2028 
 Deutsche Genossenschafts-Hypothekenbank AG                            26,988                    2.30                 31/07/2027 
                                                                       26,988                    2.30                 31/07/2027 
                                                                        1,217                    2.30                 31/07/2028 
                                                                       38,352                    2.09                 28/02/2025 
                                                                       23,357                    2.09                 28/02/2025 
                                                                        7,748                    2.30                 28/02/2025 
                                                                      195,274 
                                                             ================ 
 
 
 24. Trade and other payables 
                                                                                          31 December                31 December 
                                                                                                 2018                       2017 
                                                                                                                       (restated 
                                                                                                                           - see 
                                                                                                                            note 
                                                                                                                            2.2) 
                                                                                              EUR'000                    EUR'000 
 
 Trade payables                                                                                 1,808                      1,489 
 Accrued liabilities                                                                            4,592                        622 
 Service charges payable                                                                        4,028                      3,849 
 Sundry payables                                                                                    -                        554 
 Deferred income                                                                                    1                          8 
                                                                                               10,429                      6,522 
                                                                                =====================   ======================== 
 
 25. Derivative financial instruments 
                                                                                          31 December                31 December 
                                                                                                 2018                       2017 
                                                                                              EUR'000                    EUR'000 
 Interest rate swaps - carried at fair value through profit or loss 
 Balance at 1 January                                                                           3,333                      4,869 
 Loss / (gain) in movement in fair value through profit 
  or loss.                                                                                      2,658                    (1,536) 
 Balance at 31 December                                                                         5,991                      3,333 
                                                                                =====================   ======================== 
 
 The notional principal amounts of the outstanding interest rate swap 
  contracts at 31 December 2018 were EUR206,690,000 (2017: EUR188,165,000). 
  At 31 December 2018 the fixed interest rates vary from 0.625% to 1.01% 
  (2017: 0.402% to 0.775%) above the main factoring Euribor rate. 
 
 Maturity analysis of interest rate swaps 
                                                                                          31 December                31 December 
                                                                                                 2018                       2017 
                                                                                              EUR'000                    EUR'000 
 
 Less than 1 year                                                                               1,354                          - 
 Between 1 and 2 years                                                                              -                          - 
 Between 2 and 5 years                                                                              -                          - 
 More than 5 years                                                                              4,637                      3,333 
                                                                                                5,991                      3,333 
                                                                                =====================   ======================== 
 
 During the year the Company had Interest Rate Swaps which were in excess 
  of the debt being hedged, these have been disclosed as having a maturity 
  of less than 12 months. 
 
 26. Other financial liabilities 
                                                                                          31 December                31 December 
                                                                                                 2018                       2017 
                                                                                              EUR'000                    EUR'000 
 Redemption Liability 
 Balance at 1 January                                                                           5,663                      3,590 
 Profit share attributable to NCI in PSPF                                                       1,472                      2,073 
 Balance at 31 December                                                                         7,135                      5,663 
                                                                                =====================   ======================== 
 
 The redemption liability relates to the put option held by the minority 
  shareholders of PSPF for the purchase of the minority interest in PSPF. 
  The option period starts on 6 June 2020. The amount of the purchase 
  price will be based on the EPRA NAV on the consolidated statement of 
  financial position date as well as the movement in the EPRA NAV during 
  the year and the proportion of EPRA NAV attributable to the non-controlling 
  interest in PSPF. 
 
 A portion of the liability (EUR1,124k, 2017: (EUR795k)) is recognised 
  to cover the tax charge of the minority in PSPF on the proceeds received 
  if they choose to exercise their put option. 
 
 The recognition of the redemption liability has been accounted for as 
  a reduction in the Non-Controlling Interest with the remainder of the 
  recognition against the Group's retained earnings. Also see the consolidated 
  statement of changes in equity for the recognition accounting. 
 
 27. Share based payment reserve 
                                                                                                                     Performance 
                                                                                                                             fee 
                                                                                                                         EUR'000 
 
 Balance at 1 January 2017                                                                                                 7,614 
 
 Fee charge for the period                                                                                                26,339 
                                                                                                        ------------------------ 
 Balance at 31 December 2017                                                                                              33,953 
 
 Transfer to stated capital - settled by issue of shares                                                                (33,948) 
 Adjustment to performance fee                                                                                               (5) 
 Fee charge for the period                                                                                                 4,010 
 Balance at 31 December 2018                                                                                               4,010 
                                                                                                        ======================== 
 
 The Property Advisor is entitled to an asset and estate management performance 
  fee, measured over consecutive three year periods, equal to 15% of the 
  excess (or in the case of the initial period or any performance period 
  ending prior to 31 December 2020, 16%) by which the annual EPRA NAV 
  total return of the Group exceeds 8% per annum, compounding (the 'Performance 
  Fee'). The Performance Fee is subject to a high watermark, being the 
  higher of: 
 
 (i) EPRA NAV per share at 1 July 2018; and 
 (ii) the EPRA NAV per share at the end of a Performance Period in relation 
  to which a performance fee was earned in accordance of the provisions 
  contained with the Property Advisor and Investor Relations Agreement. 
 
 The Company's EPRA NAV performance for the three year's ending 31 December 
  2017 had resulted in a performance fee liability under the Property 
  Advisory Agreement to the Property Advisor of EUR33.948 million. The 
  parties agreed that this performance fee (but not any further performance 
  fees that may become due) be settled through the issuance by the Company 
  to the Property Advisor of 8,260,065 new shares in the Company at EPRA 
  NAV per share. 50% of the shares issued in settlement of this fee are 
  subject to a 12-month restriction on disposal. The shares were admitted 
  to trading on the premium segment of the Official List and to trading 
  on the Main Market of the London Stock Exchange on 4 May 2018. 
 
 Under the Property Advisory Agreement for providing property advisory 
  services, the Property Advisor is also entitled to a Portfolio and Asset 
  Management Fee for the 2018 period as follows: 
 
 (i) 1.50% of the EPRA NAV of the Group where the EPRA NAV of the Group 
  is equal to or less than EUR250 million; and 
 (ii) 1.25% of the EPRA NAV of the Group between EUR250 million and EUR500 
  million. 
 (iii) 1% of the EPRA NAV of the Group greater than EUR500 million. 
 
 The performance fee is reduced by the aggregate amount of any transaction 
  fees and finance fees payable to the Property Advisor in respect of 
  that calendar year. 
 
 The Property Advisor is entitled to a capex monitoring fee equal to 
  7% of any capital expenditure incurred by any Subsidiary which the Property 
  Advisor is responsible for managing (the 'Capex Monitoring Fee'). 
 
 The Property Advisor is entitled to receive a finance fee equal to: 
 
 (i) 0.1% of the value of any borrowing arrangement which the Property 
  Advisor has negotiated and/or supervised; and 
 (ii) a fixed fee of GBP1,000 in respect of any borrowing arrangement 
  which the Property Advisor has renegotiated or varied. 
 
 The Property Advisor is entitled to receive a transaction fee fixed 
  at GBP1,000 in respect of any acquisition or disposal of property by 
  any Subsidiary. 
 
 The Property Advisor is entitled to a letting fee equal to 3 month's 
  net cold rent (being gross rents receivable less service costs and taxes) 
  for each new tenancy signed by the Company where the Property Advisor 
  has sourced the relevant tenant. 
 
 Property Advisor Fees (from 1 January 2019) 
 Under the new Property Advisory Agreement for providing property advisory 
  services, the Property Advisor wil be entitled to a Portfolio and Asset 
  Management Fee as follows: 
 
 (i) 1.20% of the EPRA NAV of the Group where the EPRA NAV of the Group 
  is equal to or less than EUR500 million; and 
 (ii) 1% of the EPRA NAV of the Group greater than EUR500 million. 
 
 The management fee will be reduced by the aggregate amount of any transaction 
  fees and finance fees payable to the Property Advisor in respect of 
  that calendar year. 
 
 The Property Advisor is entitled to a capex monitoring fee equal to 
  7% of any capital expenditure incurred by any Subsidiary which the Property 
  Advisor is responsible for managing. 
 
 The Property Advisor is entitled to receive a finance fee equal to: 
 
 (i) 0.1% of the value of any borrowing arrangement which the Property 
  Advisor has negotiated and/or supervised; and 
 (ii) a fixed fee of GBP1,000 in respect of any borrowing arrangement 
  which the Property Advisor has renegotiated or varied. 
 
 The Property Advisor is entitled to receive a transaction fee fixed 
  at GBP1,000 in respect of any acquisition or disposal of property by 
  any Subsidiary. 
 
 The Property Advisor is entitled to a letting fee equal to between 1 
  and 3 month's net cold rent (being gross rents receivable less service 
  costs and taxes) for each new tenancy signed by the Company where the 
  Property Advisor has sourced the relevant tenant. 
 
 The Property Advisor shall be entitled to a fee for Investor Relations 
  Services at the annual rate of GBP75,000 payable quarterly in arrears. 
 
 Details of the fees paid to the Property Advisor are set out in note 
  33. 
 
 28. Stated capital 
                                                                                          31 December                31 December 
                                                                                                 2018                       2017 
                                                                                              EUR'000                    EUR'000 
 Issued and fully paid: 
 At 1 January                                                                                 162,630                    162,630 
 Issued during the year at EUR4.11 per share                                                   33,948                          - 
 At 31 December                                                                               196,578                    162,630 
                                                                                =====================   ======================== 
 
 The number of shares in issue at 31 December 2018 was 100,751,409 (31 
  December 2017: 92,491,344). 
 
 29. Non-controlling interests 
                                                              Non-controlling             31 December                31 December 
                                                                     interest                    2018                       2017 
                                                                            % 
                                                                                              EUR'000                    EUR'000 
 
 Phoenix Spree Mueller GmbH (formerly Laxpan 
  Mueller GmbH)                                                          5.1%                   1,026                        915 
 Phoenix Spree Gottlieb GmbH (formerly Invador 
  Grundbesitz GmbH)                                                      5.1%                     963                        810 
                                                                                                1,989                      1,725 
                                                                                =====================   ======================== 
 
 The non-controlling interest relates to the subsidiaries Invador Grundbesitz 
  GmbH and Laxpan Mueller GmbH. 
 
 30. Earnings per share 
                                                                                          31 December                31 December 
                                                                                                 2018                       2017 
 
 Earnings for the purposes of basic earnings per share 
  being net profit attributable to owners of the parent 
  (EUR'000)                                                                                    45,094                    111,538 
 Weighted average number of ordinary shares for the 
  purposes of basic earnings per share (Number)                                            97,945,250                 92,491,344 
 Effect of dilutive potential ordinary shares (Number)                                      1,014,078                  7,677,250 
                                                                               ----------------------  ------------------------- 
 Weighted average number of ordinary shares for the 
  purposes of diluted earnings per share (Number)                                          98,959,328                100,168,594 
                                                                               ======================  ========================= 
 
 Earnings per share (EUR)                                                                        0.46                       1.21 
 Diluted earnings per share (EUR)                                                                0.46                       1.11 
                                                                                =====================   ======================== 
 
 
 
 31. Net asset value per share and EPRA net asset value 
                                                                                          31 December                31 December 
                                                                                                 2018                       2017 
 
 Net assets (EUR'000)                                                                         407,858                    366,217 
 Number of participating ordinary shares                                                  100,751,409                 92,491,344 
 
 Net asset value per share (EUR)                                                                 4.05                       3.96 
                                                                                =====================   ======================== 
 
 EPRA net asset value                                                                     31 December                31 December 
                                                                                                 2018                       2017 
 
 Net assets (EUR'000)                                                                         407,858                    366,217 
 Add back deferred tax assets and liabilities, derivative 
  financial instruments, goodwill and share based payment 
  reserves (EUR'000)                                                                           53,137                     13,970 
 
 EPRA net asset value (EUR'000)                                                               460,995                    380,187 
                                                                                =====================   ======================== 
 EPRA net asset value per share (EUR)                                                            4.58                       4.11 
 
 The derivative financial liability relating to swap contracts in respect 
  of borrowings repaid has not been added back as they no longer have 
  a hedging objective (EUR1.354 million (2017: nil)). 
 
 32. Financial instruments 
 The Group is exposed to the risks that arise from its use of financial 
  instruments. This note describes the objectives, policies and processes 
  of the Group for managing those risks and the methods used to measure 
  them. Further quantitative information in respect of these risks is 
  presented throughout the financial statements. 
 
 Principal financial instruments 
 
 The principal financial instruments used by the Group, from which financial 
  instrument risk arises, are as follows: 
 -- Financial assets 
 -- Cash and cash equivalents 
 -- Trade and other receivables 
 -- Trade and other payables 
 -- Borrowings 
 -- Derivative financial instruments 
 
 The Group held the following financial assets at each reporting date: 
                                                                                          31 December                31 December 
                                                                                                 2018                       2017 
                                                                                                                       (restated 
                                                                                                                           - see 
                                                                                                                            note 
                                                                                                                            2.2) 
                                                                                              EUR'000                    EUR'000 
 
 Loans and receivables 
 Trade and other receivables - current                                                          6,982                      7,883 
 Cash and cash equivalents                                                                     26,868                     27,182 
 Other financial assets at amortised cost (2017: Loans 
  and receivables)                                                                              2,406                      2,323 
                                                                                               36,256                     37,388 
                                                                                ---------------------   ------------------------ 
 
 The Group held the following financial liabilities at each reporting 
  date: 
                                                                                          31 December                31 December 
                                                                                                 2018                       2017 
                                                                                              EUR'000                    EUR'000 
 Held at amortised cost 
 Borrowings payable: current                                                                    3,642                      2,646 
 Borrowings payable: non-current                                                              191,632                    219,648 
 Other financial liabilities                                                                    7,135                      5,663 
 Trade and other payables                                                                      10,429                      6,522 
                                                                                              212,838                    234,479 
                                                                                ---------------------   ------------------------ 
 
 
 Fair value through profit or loss 
 Derivative financial (asset)/ liability - interest 
  rate swaps                                                                                    4,637                      3,333 
 Excess hedge due to property disposal                                                          1,354                          - 
                                                                                                5,991                      3,333 
                                                                                ---------------------   ------------------------ 
 
                                                                                              218,829                    237,812 
                                                                                =====================   ======================== 
 
 Fair value of financial instruments 
 With the exception of the variable rate borrowings, the fair values 
  of the financial assets and liabilities are not materially different 
  to their carrying values due to the short term nature of the current 
  assets and liabilities or due to the commercial variable rates applied 
  to the long term liabilities. 
 
 The interest rate swap was valued externally by the respective counterparty 
  banks by comparison with the market price for the relevant date. 
 
 The interest rate swaps are expected to mature between February 2025 
  and March 2028. 
 
 The Group uses the following hierarchy for determining and disclosing 
  the fair value of financial instruments by valuation technique: 
 
 Level 1: quoted (unadjusted) prices in active markets for identical 
  assets or liabilities; 
 
 Level 2: other techniques for which all inputs which have a significant 
  effect on the recorded fair value are observable, either directly or 
  indirectly; and 
 
 Level 3: techniques which use inputs which have a significant effect 
  on the recorded fair value that are not based on observable market data. 
 
 During each of the reporting periods, there were no transfers between 
  valuation levels. 
 
 Group Fair Values 
                                                                                          31 December                31 December 
                                                                                                 2018                       2017 
                                                                                              EUR'000                    EUR'000 
 Financial assets/ (liabilities) 
 Interest rate swaps - Level 2 - current                                                      (1,354)                    (3,333) 
 Interest rate swaps - Level 2 - non-current                                                  (4,637)                          - 
                                                                                              (5,991)                    (3,333) 
                                                                                =====================   ======================== 
 
 The valuation basis for the investment properties is disclosed in note 
  17. 
 
 Financial risk management 
 The Group is exposed through its operations to the following financial 
  risks: 
 
 -- Interest rate 
 risk 
 -- Foreign exchange risk 
 -- Credit risk 
 -- Liquidity risk 
 
 The Group's policies for financial risk management are outlined below. 
 
 Interest rate risk 
 The Group's interest rate risk arises from certain of its borrowings. 
  Borrowings issued at variable rates expose the Group to cash flow interest 
  rate risk. Borrowings issued at fixed rates expose the Group to fair 
  value interest rate risk. The Group is also exposed to interest rate 
  risk on cash and cash equivalents. 
 
 Under interest rate swap contracts, the Group agrees to exchange the 
  difference between fixed and floating rate interest amounts calculated 
  on agreed notional principal amounts. Such contracts enable the Group 
  to mitigate the risk of changing interest rates on the cash flow exposures 
  on the issued variable rate debt held. 
 
 Sensitivity analysis has not been performed as all variable rate borrowings 
  have been swapped to fixed interest rates, and potential movements on 
  cash at bank balances are immaterial. 
 
 The Group gives careful consideration to interest rates when considering 
  its borrowing requirements and where to hold its excess cash. The Directors 
  believe that the interest rate risk is at an acceptable level. 
 
 Foreign exchange risk 
 The Group is exposed to foreign exchange risk on sales, purchases, and 
  translation of assets and liabilities that are in a currency other than 
  the functional currency (Euros). 
 
 The Group does not enter into any currency hedging transactions and 
  the Directors believe that the foreign exchange rate risk is at an acceptable 
  level. 
 
 The carrying amount of the Group's foreign currency (non Euro) denominated 
  monetary assets and liabilities are shown below, all the amounts are 
  for Sterling balance only: 
 
                                                                                          31 December                31 December 
                                                                                                 2018                       2017 
                                                                                              EUR'000                    EUR'000 
 Financial assets 
 Cash and cash equivalents                                                                      1,142                        598 
 Financial 
 liabilities 
 Trade and other payables                                                                       (350)                      (216) 
 Net position                                                                                     792                        382 
                                                                                =====================   ======================== 
 
 At each reporting date, if the Euro had strengthened or weakened by 
  10% against GBP with all other variables held constant, post-tax loss 
  for the year would have increased/(decreased) by: 
 
                                                                                                                 Strengthened by 
                                                               Weakened by 10%                           10% Increase/(decrease) 
                                                           Increase/(decrease)                                  in post-tax loss 
                                                              in post-tax loss                                     and impact on 
                                                          and impact on equity                                            equity 
                                                                      EUR'000                                            EUR'000 
 
 31 December 2018                                                          79                                               (79) 
 31 December 2017                                                          38                                               (38) 
 
 Credit risk management 
 Credit risk refers to the risk that the counterparty will default on 
  its contractual obligations resulting in financial loss to the Group. 
  Credit risk arises principally from the Group's trade and other receivables 
  and its cash balances. The Group gives careful consideration to which 
  organisations it uses for its banking services in order to minimise 
  credit risk. The Group has an established credit policy under which 
  each new tenant is analysed for creditworthiness and each tenant is 
  required to pay a two month deposit. 
 
 At each reporting date the Group had no tenants with outstanding balances 
  over 10% of the total trade receivables balance. 
 
 The Group uses the following banks: Barclays Private Clients International 
  Jersey Ltd, Barclays Bank Plc Frankfurt and Deutsche Bank. The split 
  of cash held at each of the banks respectively at 31 December 2018 was 
  57%/33%/10% (31 December 2017: 61%/30%/9%) Barclays and Deutsche Bank 
  have credit ratings of A and A- respectively. 
 
 The Group holds no collateral as security against any financial asset. 
  The carrying amount of financial assets recorded in the financial information, 
  net of any allowances for losses, represents the Group's maximum exposure 
  to credit risk. 
 
 Details of receivables from tenants in arrears at each reporting date 
  can be found in note 21 as can details of the receivables that were 
  impaired during each period. 
 
 An allowance for impairment is made where there is an identified loss 
  event which, based on previous experience, is evidence of a reduction 
  in the recoverability of the cash flows. Management considers the above 
  measures to be sufficient to control the credit risk exposure. 
 
 The credit risk on liquid funds and derivative financial instruments 
  is limited because the counterparties are banks with high credit-ratings 
  assigned by international credit-rating agencies. 
 
 The carrying amount of financial assets recorded in the financial statements, 
  which is net of impairment losses, represents the Group's maximum exposure 
  to credit risk as no collateral or other credit enhancements are held. 
 
 Liquidity risk management 
 Liquidity risk is the risk that the Group will not be able to meet its 
  financial obligations as they fall due. The Group's approach to managing 
  liquidity risk is to ensure that it will always have sufficient liquidity 
  to meet its liabilities when due, under both normal and stressed conditions, 
  without incurring unacceptable losses or damage to the Group's reputation. 
 
 The Directors manage liquidity risk by regularly reviewing cash requirements 
  by reference to short term cash flow forecasts and medium term working 
  capital projections prepared by management. 
 
 The Group maintains good relationships with its banks, which have high 
  credit ratings. 
 
 The following table details the Group's remaining contractual maturity 
  for its non-derivative financial liabilities with agreed maturity periods. 
  The table has been drawn up based on the undiscounted cash flows of 
  the financial liabilities based on the earliest date on which the Group 
  can be required to pay. The tables include both interest payable and 
  principal cash flows. 
 
 Maturity analysis for financial liabilities 
 
                                      Less         Between            Between 
                                      than           1 - 2              2 - 5               More than 
                                    1 year           years              years                 5 years                      Total 
                                   EUR'000         EUR'000            EUR'000                 EUR'000                    EUR'000 
 At 31 December 2018 
 
 Borrowings payable: current         3,642               -                  -                       -                      3,642 
 Borrowings payable: non-current         -               -                  -                 191,632                    191,632 
 Other financial liabilities             -               -              7,135                       -                      7,135 
 Trade and other payables           10,429               -                  -                       -                     10,429 
                                 ---------      ----------   ----------------   ---------------------   ------------------------ 
                                    14,071               -              7,135                 191,632                    212,838 
                                 ---------      ----------   ----------------   ---------------------   ------------------------ 
 
 
                                      Less         Between            Between 
                                      than           1 - 2              2 - 5               More than 
                                    1 year           years              years                 5 years                      Total 
                                   EUR'000         EUR'000            EUR'000                 EUR'000                    EUR'000 
 At 31 December 2017 
 
 Borrowings payable: current         2,646               -                  -                       -                      2,646 
 Borrowings payable: non-current         -               -                  -                 219,648                    219,648 
 Other financial liabilities             -               -              5,663                       -                      5,663 
 Trade and other payables            6,522               -                  -                       -                      6,522 
                                     9,168               -              5,663                 219,648                    234,479 
                                 ---------      ----------   ----------------   ---------------------   ------------------------ 
 
 The analysis of the market risk review and sensitivity analysis is detailed 
  in note 21. 
 
 33. Related party transactions 
 Related party transactions not disclosed elsewhere are as follows: 
 
 R Prosser, who was a director of the Company until 17 April 2018, is 
  a director of Estera Fund Administrators (Jersey) Limited and Estera 
  Trust (Guernsey) Limited, both of which provide administration services 
  to the Group. 
 
 A Weaver, who was a director of the Company until 17 April 2018, is 
  a partner of the Jersey law firm, Appleby which provides legal services 
  to the Group and a member of Appleby group. 
 
 During the year ended 31 December 2018, an amount of EUR973,424 (2017: 
  EUR690,165) was payable to Estera Fund Administrators (Jersey) Limited 
  and Estera Trust (Guernsey) Limited for accounting, administration and 
  secretarial services. At 31 December 2018, EUR134,400 (2017: EUR215,625) 
  Estera Fund Administrators (Jersey) Limited only) was outstanding. 
 
 During the year ended 31 December 2018, an amount of EUR43,010 (2017: 
  EUR40,044) was payable to Appleby, law firm for legal and professional 
  services. At 31 December 2018 EURnil (2017: EURnil) was outstanding. 
 
 M Northover was a Director during 2018 and shareholder of PMM Partners 
  (UK) Limited, the Group's appointed Property Advisor (Since changed 
  to PMM Residential on signing of the new property advisor agreement 
  in November 2018). During the year ended 31 December 2018, an amount 
  of EUR5,947,282 (EUR5,858,791 Management Fees and EUR88,491 Other expenses 
  and fees) (2017: EUR4,209,000 (EUR4,110,000 Management fees and EUR99,000 
  Other expenses and fees)) was payable to PMM Partners (UK) Limited. 
  At 31 December 2018 EUR7,450 (2017: EURNil) was outstanding. 
 
 On 1 January 2019, PMM Partners (UK) Limited was replaced as Property 
  Advisor by PMM Residential Limited. A Property Advisor and Investors 
  Relations agreement was entered in to between the Group and PMM Residential 
  Limited also with an effective date of 1 January 2019. Further details 
  of the fees payable to PMM Residential Limited can be found in note 
  27. 
 
 The Property Advisor is also entitled to an asset and estate management 
  performance fee. The charge for the period in respect of the performance 
  fee was EUR3,995,000 (2017: EUR26,339,000). Please refer to note 27 
  for more details. 
 
 The Property Advisor has a controlling stake in IWA Real Estate Gmbh 
  & Co. KG who are contracted to dispose of condominiums in Berlin on 
  behalf of the Company. IWA does not receive a fee from the Company in 
  providing this service. 
 
 In March 2015 the Group also entered into an option agreement to acquire 
  the remaining 5.2% interest in Phoenix Spree Property Fund GmbH & Co.KG 
  (PSPF) from the remaining partners being M Hilton and P Ruddle both 
  Directors of PMM Partners (UK) Limited. The options are to be exercised 
  on the fifth anniversary of the majority interest acquisition for a 
  period of three months thereafter at the fair value of the remaining 
  interest. For their role as the limited partner in Phoenix Spree Property 
  Fund GmbH & Co.KG they were also paid EUR120,000 (2017: EUR120,000) 
  each. 
 
 The Group entered into an unsecured loan agreement with M Hilton and 
  P Ruddle in connection with the acquisition of PSPF. At the period end 
  an amount of EUR768,195 (2017: EUR747,120) each was owed to the Group. 
  The loans bear interest of 4% per annum. 
 
 Dividends paid to directors in their capacity as a shareholder amounted 
  to EUR1,740 (2017: EUR1,527). 
 
 34. Events after the reporting date 
 
 In April 2019, the Company exchanged contracts for the acquisition of 
  one individual property in Berlin for the purchase price of EUR2.4 million. 
  The property is still awaiting completion. 
 
 The Company had exchanged contracts for the acquisition of one property 
  in Berlin with a purchase price of EUR2.2 million prior to the reporting 
  date, which as at balance sheet date had not yet completed. The purchase 
  completed in January 2019. 
 
 In Q1 2019, the Company exchanged contracts for the sale of one commercial 
  unit and one residential unit in BoxhagenerStraße with an aggregated 
  purchase price of EUR1.9 million. The sale of these units subsequently 
  completed in April 2019. 
 
 The Company had exchanged contracts for the sale of three condominiums 
  in Berlin with aggregated consideration of EUR1.1 million prior to the 
  reporting date. The sale of these units subsequently completed in Q1 
  2019. 
 
 The Company exchanged contracts for the disposal of the last non-Berlin 
  property for the sale price of EUR3.9 million prior to the reporting 
  date, the sale of this property subsequently completed in January 2019. 
 
 In February 2019, the Company drew down the final EUR0.9 million portion 
  of the EUR7.5 million loan with Berliner Sparkasse. EUR6.6 million of 
  the debt was drawn down in December 2018. 
 
 
 
 Professional Advisors 
 
 Property Advisor                  from 1 January 2019 
                                   PMM Residential Limited 
                                   54-56 Jermyn Street 
                                   London SW1Y 6LX 
 
                                   to 31 December 2018 
                                   PMM Partners (UK) Limited 
                                   54-56 Jermyn Street 
                                   London SW1Y 6LX 
 
 Administrator                     Estera Fund Administrators (Jersey) Limited 
 Company Secretary                 Estera Secretaries (Jersey) Limited 
 and Registered Office             13-14 Esplanade 
                                   St. Helier 
                                   Jersey JE1 1EE 
 
 Registrar                         Link Asset Services (Jersey) Limited 
                                   12 Castle Street 
                                   St. Helier 
                                   Jersey JE2 3RT 
 
 Principal Banker                  Barclays Private Clients International 
                                    Limited 
                                   13 Library Place 
                                   St. Helier 
                                   Jersey JE4 8NE 
 
 UK Legal Advisor                  Stephenson Harwood LLP 
                                   1 Finsbury Circus 
                                   London EC2M 7SH 
 
 Jersey Legal Advisor              Appleby Global Group Services Limited 
                                   13-14 Esplanade 
                                   St. Helier 
                                   Jersey JE1 1EE 
 
 German Legal Advisor              Mittelstein Rechtsanwälte 
 as to property law                Alsterarkaden 20 
                                   20354 Hamburg 
                                   Germany 
 
 German Legal Advisor as           Taylor Wessing Partnerschaftsgesellschaft 
                                    mbB 
 to German partnership law         Thurn-und-Taxis-Platz 6 
                                   60313 Frankfurt a.M. 
                                   Germany 
 
 Sponsor and Broker                Liberum Capital Limited 
 (Broker until 17 September        Ropemaker Place 
  2018) 
                                   25 Ropemaker Street 
                                   London EC2Y 9LY 
 
 Broker (from 17 September 2018)   Numis Securities Limited 
                                   The London Stock Exchange Building 
                                   10 Paternoster Square 
                                   London 
                                   EC4M 7LT 
 
 Independent Property Valuer       Jones Lang LaSalle GmbH 
                                   Rahel-Hirsch-Strasse 10 
                                   10557 Berlin 
                                   Germany 
 
 Auditor                           RSM UK Audit LLP 
                                   25 Farringdon Street 
                                   London EC4A 4AB 
 
 

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com or visit www.rns.com.

END

FR PGUQGCUPBGRQ

(END) Dow Jones Newswires

April 29, 2019 02:01 ET (06:01 GMT)

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