Colonia Real Estate AG / Strategic Company Decision/Alliance 11.03.2008 Release of an Ad hoc announcement according to § 15 WpHG, transmitted by DGAP - a company of EquityStory AG. The issuer is solely responsible for the content of this announcement. --------------------------------------------------------------------------- Colonia Real Estate starts biggest solar project for residential properties in Germany Innovative business segment generates long term recurring earnings - Master agreement closed for solar modules for up to EUR 100mn - Conservative scenario: Recurring earnings of EUR 6 to 8mn p.a. - Return on equity of about 50% in this new business segment - CRE combines continuosely high returns and ecological responsibility Cologne, 11th of March 2008 The real estate company Colonia Real Estate AG (ISIN DE0006338007) opens the real estate business towards the renewable energy, opening a new highly profitable business area 'Sustainable Living'. It is planned to install solar panels on the roofs of the residential properties of the Colonia Real Estate during the following month in order to produce environmental friendly power. For this purpose a master agreement was closed between the exchange-listed systaic AG (ISIN DE000A0JKYP6) and Colonia Real Estate AG. Thus, systaic will provide and install solar panels worth EUR 100mn to produce 20-25MWp power per year. This equates a total power supply of almost 6,000 households. Before the agreement was closed the residential portfolio of the Colonia Real Estate was extensively proved regarding the feasibility. The first solar modules will presumably be installed in May 2008. The entire installation is expected to be finalized by the end of 2008. Additionally, this will lead to a CO2 reduction of 14,000 tons per year. Colonia Real Estate estimates that in a first step 50%-60% of the project volume will be realised on their own properties. Currently, the 20,000 residential units in the portfolio of Colonia make the company the third largest exchange listed residential company in Germany. It is planned to install further solar modules on properties supervised by Colonia´s asset management. CRE´s entire assets under management are currently EUR 3 bn. The combination of real estate and renewable engery will also be made available to third parties. Herefore, additional master agreement are in current negotiations. Colonia Real Estate expects in a first step an investment volume on own objects of around EUR 60mn. Those solar power systems produce annual guaranteed recurring cash flows from feeding power into the national power grid under the 'Erneuerbare Energie Gesetz' (EEG) in the amount of approximately EUR 6 to 8mn additionally to the current EUR 60mn rental income. The return on equity of this new business segment will be at around 50%. It is planned that the investments will be financed with an equity ratio of about 10%. Financing offers are currently negotiated with several banks. Moreover, Colonia Real Estate secured a call option through their investment at the company systaic AG of 10%. Contact: Christoph D. Kauter Head of Corporate Finance and Investor Relations Colonia Real Estate AG Zeppelinstr. 4-8 50667 Köln Telefon: +49 (0)221 71 60 71 0 Fax: +49 (0) 221 71 60 71 99 E-Mail: ir@cre.ag PR and Press Contact: edicto GmbH Axel Mühlhaus Tel.: +49 (0) 69 9055055-2 amuehlhaus@edicto.de DGAP 11.03.2008 --------------------------------------------------------------------------- Language: English Issuer: Colonia Real Estate AG Zeppelinstr. 4 - 8 50667 Köln Deutschland Phone: +49 221-716071-0 Fax: +49 221-716071-99 E-mail: info@cre.ag Internet: www.cre.ag ISIN: DE0006338007 WKN: 633800 Indices: SDAX, GPR 250, MSCI Germany Small Cap Index, FTSE EPRA/ NAREIT, E&G DIMAX Listed: Regulierter Markt in Berlin, Frankfurt (Prime Standard), Düsseldorf; Freiverkehr in Hamburg, München, Stuttgart End of News DGAP News-Service ---------------------------------------------------------------------------
DGAP-Adhoc: Colonia Real Estate starts biggest solar project for residential properties in Germany - Innovative business segment generates long term recurring earnings
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