1. Key figures

In a calculation example, the bank loan, compared to full ownership and considering ground rent, is covered by relative higher rental income and a higher operating cash flow. ICR and DSCR are comparatively higher.

2. Land as substitute equity capital

From the banks perspective in the calculation example, about 91% of Trimelón financing tranche can be considered as equity substitute, as this portion of purchase price for the property is unsecured. The ground rent land charge remains active even in the event of a forced sale and the ground rent is not capitalised. There is therefore no “compensation” over the remaining term of the contract given to the property owner. Rather, the retroactive compensation to the property owner is a maximum of 2 years. (§ 19 II. ErbbauRGi.V.m. §§ 52 II ZVG and 10 I. ZVG).

3. Club deal financing structure vs. full ownership