Immobilien AG: activities, stock exchange, conditions & advantages

A real estate stock corporation – or real estate AG for short – is a real estate company that has the legal form of a regular stock corporation (AG) and whose core business is primarily focused on the real estate sector. The company’s assets are thus used primarily – or exclusively – for real estate investments, or they consist of the construction of real estate and the subsequent sale of the same.

The largest German listed companies for residential real estate (as of 31.12.2o19):

• Vonovia
• German Housing
• LEG
• DAY
• Grand City Properties
• Adler Real Estate
• GAG

Business Activities Real Estate AG – Construction, Trading, Management & Co.

The range of activities of real estate stock corporations focuses, for example, on project development and the construction of real estate. The management and sale of real estate are also not uncommon focal points of this type of company. All in all, public limited companies can be involved in real estate trading, the brokerage of real estate as well as the holding and management of their own portfolios or offer corresponding services for non-corporate investment portfolios. Real estate stock corporations are a particularly popular choice for leasing.

Possible activities at a glance:

• Project development
  • Building
• Real Estate Trading
  • Acquisition
  • Distribution
• Real estate management
  • Hold
  • Farm
  • Rent
• Third-party services
  • Brokerage of real estate not owned by the company

Real estate company on the stock exchange – legal requirements & advantages

Real estate stock corporations can choose whether or not they want to be listed on the stock exchange. If you are a shareholder of a real estate stock corporation and decide to list your company on the stock exchange, you are subject to the German Real Estate Investment Trust Act (REIT Act). The REIT Act specifies which general regulations apply to your company and which qualifications your company must have in order to be admitted as a REIT stock corporation, as well as which tax regulations must be taken into account.

Many family businesses wishing to operate in the real estate sector as a public limited company (AG) deliberately decide against such a stock exchange listing, as the shareholders of their company are to be restricted to their own family circle of contacts and no share trading in public is envisaged.

Exchange-traded real estate stock corporation / REIT-AG

The REIT corporation is originally based on a US corporate form, namely the “Real Estate Investment Trust” – REIT for short – which gave the listed real estate corporation its name. Since its beginnings, the trust has experienced a considerable upswing. Little known in 1960, the corporate legal form slowly but steadily conquered the world in the 1990s and gained international renown. With the enactment of the REIT Act in 2007, the legal form of the REIT-AG was also introduced in Germany.

To make it easier to distinguish between them, German REITs are also often referred to as G-REITs, with the “G” standing for “Germany”. Sometimes REITs are also incorrectly translated as real estate funds in this country – however, there are some legal and economic peculiarities compared to the German legal form of the real estate fund.

Legal requirements according to REITG – stock exchange listing, quota & Co

In order for real estate stock corporations to be recognized as REIT corporations and to enjoy the corresponding advantages and benefits, they must meet a number of requirements defined in the German Real Estate Stock Corporations with Listed Shares Act (REITG). One of these rules requires that the real estate stock corporation be mandatorily listed on the stock exchange. Other restrictions relate to the company’s permitted free float – i.e. all company shares distributed among several, smaller investors – as well as the participation by shareholders together with per capita distribution of the shares. Other conditions regulate the equity capital, the fixed assets and also the turnover generated by the management of real estate.

Legal requirements for a REIT-AG:

• Headquarters & Management within Germany
• Listing on the market obligatory
• Free float at the time of listing: at least 25%.
• Free float after listing: at least 15%.
• Equity ratio: at least 45
• Real estate investments (immovable assets): at least 75%.
• Income from real estate: at least 75
• REIT participation per shareholder: max. 10%.
• Distribution ratio (net profit): at least 90%.

Small tip: For real estate stock corporations shortly before listing, a time window of two years is granted in order to fulfil all necessary requirements. Until all requirements under the REITG have been fulfilled, such a company is considered a pre-REIT.

Advantages for REIT stock corporations – tax exemption, competitive advantage & Co.

Real estate stock corporations with a stock exchange listing are particularly popular for financiers and large investors, as they are exempt from both corporation tax and trade tax, provided they meet the legal requirements in accordance with the REITG. As real estate is a particularly safe investment opportunity, it offers the chance to cushion inflationary fluctuations and risks. Furthermore, the purchase and sale of shares is simple thanks to market access, and transfers of ownership can be carried out quickly and flexibly.

Access to the capital market enables a real estate stock corporation to skilfully generate equity capital, which can then finance the investment in real estate. As a result, real estate stock corporations have a clear advantage in terms of the speed of growth of their equity, which means greater competitiveness in the market as a whole. Other legal forms of companies, on the other hand, are dependent on retaining their profits – that is, leaving the profits in the company instead of distributing them and accumulating them there – in order to increase their company’s equity capital or have no legal claim to a distribution of profits. The legal form also offers a considerable degree of security, as the equity capital accounts for just under half of the stock corporation’s total capital.

Advantages for listed real estate companies:

• No corporate income tax
• No trade tax
• Secure investment through tangible assets (real estate)
• Chance to offset inflation
• Quick & easy purchase/sale of shares
• Flexible share transfer
• Simple equity procurement
• Competitive advantage due to high growth rate
• High security due to equity ratio

Advantages for investors – Stable cash flow, growth & 90 % dividend

Another plus: the REIT corporation also offers a lucrative business for investors. Public limited companies are generally established for the long term, which means that the company can offer investors the prospect of a stable cash flow and long-term growth without exposing them to increased risk. The dividend payout is also very attractive for shareholders, with a statutory minimum requirement of 90 percent of the net profit for the year under commercial law.

Advantages for real estate AG investors:

• Stable cash flow
• Long-term corporate growth
• Low risk
• Attractive dividend payout

However, the application of the half-income method is not possible for shareholders with regard to the distribution of profits. Their profits must be fully taxed.

Real estate stock corporation / REIT-AG – For whom is it worthwhile?

Are you thinking about founding a real estate company or investing in an existing real estate company? For construction companies and development companies, this is often a lucrative venture, but also as a financier or shareholder of a real estate holding company, the formation of a real estate corporation can be quite worthwhile. Furthermore, the economic occurrence of real estate stock corporations extends to housing associations, property management companies and large brokerage firms.

Ownership of the real estate portfolio may be held either by the real estate company itself as a direct investment or by another real estate company whose shares are acquired by the real estate company by means of a participation. A mixture of direct investments and third-party investments is often used to acquire, hold or sell real estate. Due to the wide range of residential and commercial properties, the stock exchange listing is an attractive model for real estate companies.

AG: foundation, legal form, real estate shares (list)

1. Stock corporation (AG)
2. Real estate shares: List of companies
3. Real estate company
4. Alternatives to the REIT: Legal forms in Germany

Stock corporation (AG): Formation, liability, legal form & Co.

Aktiengesellschaft (AG) – The stock corporation is a German legal form founded by at least one person and organized by different bodies. Instead of a managing director, the company is managed by a board of directors consisting of at least one person. As the name already indicates, this legal form of a company primarily stands for stock trading. You would like to start a company alone or together with other people and learn more about company law forms in advance? Then you’ve come to the right place!

• Stock corporation (AG)

Real estate shares: List of companies

Real Estate Shares – Not everyone can afford real estate as a capital investment. Through real estate shares, however, everyone can participate in the real estate market and invest money. The share prices of the big players are rising year after year. Vonovia, Deutsche Wohnen, Dream Global, CBRE and Patrizia are a few of the best known active companies in Germany. In addition, there are more than 25 other companies. We have an overview of the most popular real estate stocks for you as an investor. But first a look at the risks of a stock, the stock market, for beginners and beginners. Now to the list and more on the real estate market, your investment options and all prices at a glance, here in the article on real estate stocks.

• Real Estate Stocks

Real Estate GmbH & Asset Management GmbH

Alternative – In this article you will learn the basics about real estate companies. Briefly explained, a real estate company is a company that has the purpose of leasing, developing, financing, realizing and/or marketing. It doesn’t matter if it is one or more properties. The management of residential and commercial real estate – in its own interest or as a service offered to third parties – is also a popular focus for real estate companies and asset management GmbHs. Find out more about the main advantages and disadvantages of buying real estate and the expected costs.

• Real estate company

Alternatives to the REIT: Legal forms in Germany

Legal forms – What types of company are there? If you want to start your first company, then choosing the ideal legal form is one of the first steps in the process of setting up a company. Whether it’s a special real estate company or a start-up, I’ve summarized all the types of companies in Germany for you here.

• Legal forms: List

Company types in detail:

• Sole proprietorship
• Registered businessman / registered businesswoman (e. K.)
• Civil law partnership (GbR)
• General partnership (OHG)
• Limited partnership (KG)
• Entrepreneurial company (UG)
• GmbH: Limited liability company
• Real estate GmbH / Asset management GmbH
• Stock corporation (AG)
• Societas Europaea (SE)
• Foundation / Family Foundation

Stairwell at a glance: Required for the existence and safety of a building

• In a multi-party house it counts as usable and common area
• In order to avoid conflicts within the neighbourhood, certain things should be regulated
• Things to be regulated include: The cleaning of the stairwell and which items may and may not be placed within the stairwell.

Back to the wiki: Real Estate

Garden planning – tips and tricks for your dream garden

Spring is here and summer is just around the corner. It’s high time to spruce up the garden for great summer days. A new herb bed, a swimming pond or perhaps a complete redesign of your oasis of well-being? So that you are well prepared and can start redesigning your garden, we have prepared some great ideas to bring summer into your garden.

You don’t have a garden? No problem, because we show you how to make your balcony or terrace fit for the summer!

Garden planning and design – step by step to a beautiful garden

Every renovation should start with good planning. Whether a complete renovation or just a small remodel, the steps should be well thought out and planned in advance. The division of the garden into different sections is very important. Depending on the requirements of the garden, more or less space must be planned for the individual elements. It should also be considered in advance which elements should be self-built and which should be commissioned. Creating some small elements in the garden yourself is a nice memory and a great project, especially in spring. How to transform an allotment from an unkempt shrubbery into a great feel-good spot is detailed in the video. Valuable tips on design principles and the first planning steps are also given.

• Garden design always needs good planning in advance
• The various garden elements must be well coordinated and adapted to the garden.

Designing a low-maintenance garden – enjoy and don’t slave away

A garden should be one thing above all, and that is an oasis of well-being. Very few people want to do heavy gardening work on a daily basis, which is why when planning a garden, attention should always be paid to what follow-up work the elements entail. Many different beds, a large grassy area and a pool make more work than a swimming pond, low-maintenance plants and a pebble path. So when planning a garden, always consider your own needs to choose the right elements for your garden. In the video, a professional explains how a garden can be laid out in a low-maintenance way, what benefits arise from this and what needs to be considered in the planning phase.

• A garden can be made very apple friendly with the right elements
• A low maintenance garden is perfect to relax and enjoy

Build your own garden path – visual connection and separating element

A garden path offers many practical advantages. Visually, a garden path is very nice to look at and additionally a great element to separate the garden into different areas. A garden path can also be practical, as it usually leads from one part of the garden to another. Especially barefoot, it is often more pleasant to walk over a path than through the grass. Creating a garden path is relatively easy and depending on the look, can be done on your own. In the video, it is explained step by step how a garden path can be easily created by yourself and how useful it can be. The example is illustrated by a gravel path with slabs.

• A garden path can be built with a few simple steps selsbt
• Visually, a garden path is a nice subdivision of the individual sections and a connection between them

Creating a garden pond – a small oasis in just a few steps

A garden pond has a particularly great visual effect, as it creates a small water paradise in the garden where fish and plants can find a home. Since water is considered a symbol of tranquility for many, a pond can directly change the atmosphere. The gentle lapping of the water and the shimmering of the sun on the surface of the water give the garden a great atmosphere. The creatures in the pond and the design of the individual elements invite you to observe and discover them. Especially in small gardens a pond offers a great element, because not much space is needed, but a great effect can be achieved. The video explains step by step how easy it is to create a small pond in your own garden.

• A garden pond provides a feel-good area and greatly enhances the atmosphere of the garden
• The construction is quite simple and can be done by yourself

Build your own fireplace – the element of fire for an idyllic togetherness

A fireplace offers a varied element in the garden design. It can be used for great events, such as a barbecue, but also provide a place of relaxation and idyll on warm summer nights. A fireplace invites to a nice get-together and is especially popular with families. In large gardens a demarcation of the fireplace as a separate area with surrounding design is a great element to create a whole new area. But even small gardens can enjoy the benefits of a fire pit. The video shows how easy it is to build a fire pit yourself and what a great effect the element of fire can have in garden design.

• A fireplace is easy to build yourself by hand
• The garden gains a great element that changes the atmosphere in the garden and can be used in many ways.

Growing your own herb garden – the right herbs and creative freedom

Herb gardens offer great design elements in the garden and are additionally useful for the kitchen. The beds can be created in a wide variety of sizes and shapes and thus offer a lot of creative freedom for both small and large gardens. The arrangement of the beds is completely up to the owner. From thyme to rosemary and basil, anything your heart desires is possible. In the video, experts show how easy it is to create herb beds yourself, what needs to be taken into account and how the bed can also look visually appealing. Which herbs are particularly suitable for cultivation in German herb beds, you can find out in the video.

• A herb garden is not only practical, but also beautiful to look at
• The construction is very simple and can be individually adapted to all conditions.

Building a swimming pond – a big project with a big effect

A swimming pond is a larger project that also requires a larger garden. The effect that such an element achieves is spectacular. A well planned and built swimming pond can change the whole atmosphere of a garden and increase the comfort enormously. The natural design blends in with the natural surroundings and allows you to create an oasis of well-being. Through natural filtration with the help of certain aquatic plants, the pond even remains chemical and therefore chlorine free. The care and time required for maintenance is thus greatly minimized. In the video, a professional shows the entire planning and construction process of a swimming pond and a breathtaking result.

• A swimming pond is very inviting, especially in large gardens, and integrates well with nature.
• The advantages are numerous and especially on hot summer days the swimming pond is worth its weight in gold.

Designing small gardens – great effect with few elements

The trend towards small gardens is on the rise. Often there is simply not enough space to create an expansive garden. However, the design does not have to be restricted by the size of the garden. Even small gardens have the potential to become an oasis of peace and an idyllic place of relaxation. Choosing the right elements is crucial here. The video also shows how important it is to plan and position the individual elements precisely so that the garden does not appear overcrowded. The video makes clear that a great use of the given possibilities is nevertheless possible and even small elements can have a great effect.

• Even small gardens can become a paradise of well-being with the right planning
• The right elements in the right position allow perfect use of the given space