The Berlin rent cap has disrupted the market, but with a continuing housing shortage and new investment curtailed, free-market rents and condominium prices continued to increase in FY20, driving continuing strong returns for Phoenix Spree Deutschland (PSD). As discussed in detail in our December initiation note, pending a resolution of the rent cap legal challenge, PSD has sought to mitigate the effects while maintaining strategic flexibility; a resolution, which PSD expects by mid-year, will determine the strategy for extracting the value embedded in its portfolio.
