Vonovia SE on the Capital Market

• Despite Vonovia achieving its forecast for 2022 and exhibiting ongoing positive economic development, share price performance is still being hit by the macroeconomic environment – in particular by interest rate development.
• Very good placement in key ESG ratings such as MSCI, CDP and S&P Global again.

Capital Market Development and Shares in Vonovia

The past year on the capital markets was dominated in particular by high inflation, rising interest rates and concerns about a recession. In this environment, it came as little surprise to see a negative performance in almost all sectors: DAX 40 -12.3%; EURO STOXX 50 -11.5%; EPRA Europe -38.9%.

The real estate sector was hit harder than most, largely due to the capital-intensive nature of the business. Rising bond yields also made real estate shares less attractive in relative terms. In this environment, at least the short-term outlook for shares in German residential real estate was particularly pessimistic, not least against the backdrop of the increase in value seen in recent years, and resulted in underperformance in an environment that was already challenging. Shares in Vonovia lost 54.6% in the course of the year, closing 2022 at € 22.02. This was once again due to the marked negative correlation with government bond yields.

Sector Development

This means that we are still observing an ever-wider gap between what remain pessimistic capital market expectations on the one hand, and the sustained robust development on the residential real estate market on the other. While the capital market appears to be pricing in a large-scale correction for real estate assets, the residential property markets in which we operate remain relatively stable. This is due, in particular, to the favorable relationship, from an owner’s point of view, between supply and demand in urban regions, which have conventionally been long-term financing arrangements, tax aspects as well as the structural momentum on the revenue side.

As a result, even though Vonovia’s share price declined in 2022, we still believe that our shares can reflect the positive operating development and ultimately the success of our business model as a whole, at least in the medium to long term. Our responses to key long-term megatrends – climate change, urbanization and demographic change – remain the dominant factors driving our business. We are optimistic as we look ahead to the future and are confident that we will remain financially successful.

The average daily trading volume for shares in Vonovia SE, expressed as the number of shares traded on XETRA, came to 2.5 million in 2022. Expressed in euros, shares in Vonovia worth € 84 million were traded every day on average in 2022, on a par with the previous year.

Vonovia’s shares reached their highest intraday price for the year on February 2, 2022, at € 51.30 and their lowest price on October 13, 2022, at € 18.58.

Vonovia’s market capitalization amounted to around € 17.5 billion as of December 31, 2022.

Share Price Development

Index Memberships: Vonovia SE member of the EURO STOXX 50, DAX 50 ESG and DJSI Europe

Vonovia has been a member of various sustainability indices since 2020, in particular the DAX 50 ESG and the Dow Jones Sustainability Index (DJSI Europe), which confirms Vonovia’s successful ESG activities and the progress made in this area.

Long-term Yield

An investor who bought shares in Vonovia when the company went public in 2013 and has held them ever since, reinvesting each dividend in more shares in Vonovia, will have seen the value of their securities deposit account increase by 108% by December 31, 2022, a result that far outstrips the performance of a corresponding investment in the benchmark indices.

Yield since Vonovia IPO