TAG Immobilien AG (TAG) has reported exceptionally successful operational development for the first six months of the 2026 financial year. FFO I, which reflects the letting business in Germany and Poland, rose to EUR 100.2 million in the first half of 2026. This represents an increase of 9 percent compared to the same period last year, when FFO I stood at EUR 91.6 million. This positive development was significantly driven by sustained good like-for-like rental growth in Germany of 3.0 percent per annum, including vacancy reduction, and 2.4 percent per annum in Poland. Vacancy rates remained low, at 3.8 percent in German residential units and 2.1 percent in Poland, relating to apartments that have been let for at least one year.
EBITDA from lettings increased to EUR 132.2 million in the first half of 2026, representing a 5 percent rise compared to EUR 126.4 million in the previous year. The Polish letting portfolio also experienced a growth surge due to the acquisition of the R4R portfolio, which comprises approximately 5,300 newly built rental apartments. The transaction, certified on 16 August 2025, was completed on 27 May 2026 following antitrust approval. The final purchase price amounted to approximately EUR 575 million, corresponding to an estimated gross initial yield of around 7.5 percent projected by TAG. The initial valuation of this portfolio as at 30 June 2026 resulted in a value appreciation of approximately 7 percent to a new book value of around EUR 611 million.
In Germany, TAG is also continuing to expand its letting portfolio. Since the first quarter of 2026, a total of 894 residential units have been acquired for a purchase price of EUR 51.6 million. Of these, 257 units were acquired in the second quarter of 2026, and a further 637 units were acquired after the balance sheet date. These properties, predominantly located in East Germany, show a current gross initial yield of 7.1 percent with an average vacancy rate of around 4.3 percent. The closing of these acquisitions is expected during the second half of the year or by the end of 2026.
With the acquisition of the R4R portfolio, TAG's Polish rental apartment portfolio reaches a substantial size of approximately 9,100 apartments. These additional, high-yield rental units contribute to an increase in ongoing cash flows in the Polish letting segment. In conjunction with the very good operational development in both rental markets, TAG is now forecasting FFO I for the full year 2026 at the upper end of the previously communicated expectation range.
In the first half of 2026, 1,350 apartments were sold in Poland, an increase compared to the 1,158 apartments in the same period last year. Sales results also developed positively, with EUR 18.6 million in the first half of 2026, a 12 percent increase over the EUR 16.6 million of the previous year. FFO II, which, in addition to FFO I, also considers sales results almost exclusively from Poland, rose by 11 percent to EUR 118.6 million in the first half of 2026, compared to EUR 107.3 million in the previous year.
A significant milestone was the successful initial public offering (IPO) of the Polish subsidiary ROBYG S.A. (ROBYG) in June and July 2026. Through a partial sale of ROBYG shares held by TAG and cash capital increases at the ROBYG level, gross proceeds of approximately EUR 282 million were generated for the group, of which approximately EUR 188 million was at the TAG level and around EUR 94 million at the ROBYG level. The capital released by the IPO enables targeted investments in rental housing portfolios in Germany and Poland, thereby strengthening TAG's letting earnings (FFO I) and thus its dividend distribution. ROBYG now has substantial funds for further growth and to bolster TAG's Polish sales business.
TAG remains the majority shareholder of ROBYG with a 67.1 percent stake. A positive effect on EPRA NTA of around EUR 55 million, or approximately EUR 0.30 per share, is expected from the sale of the ROBYG shares. The TAG Group's LTV will decrease by approximately 3.2 percentage points due to the total cash inflow from the IPO. These effects are not yet included in the interim financial statements as at 30 June 2026, as the significant transactions became effective only after this date. Following the IPO, ROBYG has a market capitalisation of approximately EUR 860 million, based on a placement price of PLN 34.00 per share. TAG's remaining stake is valued at approximately EUR 580 million on this basis. Compared to the historical acquisition costs for ROBYG in 2022, TAG has realised an appreciation in its investment of around 40 percent.
The improved capital structure after the ROBYG IPO was reflected in the ratings: Moody’s upgraded TAG to “Baa2” in May 2026 and S&P Global to “BBB” in July 2026. Both agencies refer to TAG's strong financial profile with industry-low leverage and a good liquidity position. Ms Claudia Hoyer, COO and Co-CEO of TAG, stated that the strong development of the letting business in Germany and Poland, as well as the successful ROBYG IPO, underscore the strength of the business model in both countries.
