Interim Report

INTERIM

STATEMENT

2021 ON THE 3RD QUARTER

GROWING CASHFLOWS

2
Group financials	Business development	Balance sheet

GROUP FINANCIALS

in EURm

Income statement key figures	01/01/-09/30/2021	01/01/-09/30/2020
Net actual rent	249.3	239.8
EBITDA (adjusted)	171.7	167.4
Consolidated net profit	362.4	189.1
FFO I per share in EUR	0.94	0.90
FFO I	137.5	131.1
AFFO per share in EUR	0.61	0.52
AFFO	89.4	76.4

Balance sheet key figures	09/30/2021	12/31/2020
Total assets	6,827.6	6,478.0
Equity	2,910.1	2,681.5
Equity ratio in %	42.6	41.4
EPRA Net Asset Value (NTA, fully diluted) per share in EUR	23.88	21.95
LTV in %	44.3	45.1

Portfolio data	09/30/2021	12/31/2020
Units Germany	87,647	88,313
Units Poland (secured pipeline)	12,085	8,742
GAV (real estate assets Germany and Poland)	6,428.2	5,984.4
Vacancy in % (total)	6.0	5.6
Vacancy in % (residential units)	5.7	4.5
l-f-l rental growth in %	1.8	1.4
l-f-l rental growth in % (incl. vacancy reduction)	1.7	1.5

Employees	09/30/2021	12/31/2020
Number of employees	1,363	1,354
Capital market data
Market cap at 09/30/2021 in EUR m		3,709.3
Share capital at 09/30/2021 in EUR		146,498,765
WKN/ISIN		830350/DE0008303504
Number of shares at 09/30/2021 (issued)		146,498,765
Number of shares at 09 /30/2021 (outstanding, without treasury shares)		146,366,881
Free Float in % (without treasury shares)		99.92%
Index		MDAX/EPRA

			3
Income statement	Cashflow statement	Financial calendar	Contact

CONTENTS

TABLE OF CONTENTS

Group Financials

Business Development

Consolidated Balance Sheet

Consolidated Income Statement

Consolidated Cashflow Statement

Financial Calendar/Contact

02

04

24

26

27

28

4
Group financials	Business development	Balance sheet

BUSINESS DEVELOPMENT

BUSINESS PERFORMANCE IN THE FIRST NINE MONTHS

OF THE 2021 FINANCIAL YEAR

Fundamentals of the Group

TAG Immobilien AG (also referred to as 'TAG' or the 'Group' in the following) is a Hamburg-based property company focused on the residential real estate sector. The properties of TAG and its subsidiaries are spread across various regions in Northern and Eastern Germany and North Rhine-Westphalia and, since the 2020 financial year, in Poland as well. Overall, at 30 September 2021 TAG managed around 87,600 residential units in Germany (31 December 2020: around

88,300) and had a contractually secured project pipeline for the construction of around 12,100 units (31 December 2020: around 8,700 units) in Poland, of which approx. 8,500 units (31 December 2020: approx. 5,700 units) are earmarked for long-term portfolio retention.

TAG Immobilien AG shares are listed on the MDAX of the Frankfurt Stock Exchange, with a market capitalisation of EUR 3.7bn as at 30 September 2021 (31 December 2020: EUR 3.8bn).

TAG's business model is the long-term letting of flats. All functions essential to property management are carried out by its own employees. The Company also provides caretaker services and craftsman services for its own portfolio. It specialises in inexpensive housing that appeals to broad sections of the population. The Group's own multimedia company supports the provision of multimedia services to tenants and expands the range of property management services offered. Energy management is pooled in a subsidiary and comprises the supply of commercial heating to the Group's own properties with the aim of optimising energy management. In the medium term, these services are to be further expanded and supplemented with new services for tenants.

			5
Income statement	Cashflow statement	Financial calendar	Contact

TAG invests primarily in medium-sized towns and in the vicinity of large metropolises, as this is where potential for growth, and in particular better opportunities for returns in comparison with investments in the big cities, is seen. The newly acquired portfolios usually have higher vacancies, which are then reduced following their acquisition, through targeted investments and proven asset-management concepts. In Germany, investments are made nearly exclusively in regions where TAG already manages assets, so as to make use of existing management structures. Also, knowledge of the local market is essential when acquiring new portfolios.

Besides long-term property management, the Group selectively exploits sales opportunities in order to reinvest the rea- lised capital appreciation and liquidity into new portfolios with higher yields. This strategy of 'capital recycling' is TAG's response to the intense competition for German residential real estate, and puts a focus on earnings per share. Growth in absolute orders of magnitude is not at the forefront of the corporate strategy. Instead, the aim is to offer tenants affordable housing through sustained, active portfolio management, and investors growing cash flows through attractive dividends. In the 2020 financial year, TAG regionally expanded its portfolio into Poland. Vantage Development S.A. ('Vantage'), a real estate developer based in Wrocław, serves as the platform for further development, which in future will focus on building up a Group-owned portfolio of apartments in Poland and currently also includes the ongoing sale of units already planned and to be constructed.

The growing Polish residential real estate market is the target of a regional expansion of TAG's business model which here, too, focuses on strong cash returns (i.e. FFO returns in relation to the equity invested). The Polish residential for rent market is characterised by a supply shortage. It is considered one of the least saturated residential markets in Europe, with a shortage that already exceeds 3.5m units (OECD). Furthermore, the absolute size of the Polish market (approx. 38 million inhabitants, sixth-largest EU country by population), coupled with a growing service sector and favourable demographic trends ('Generation Rent' - a growing preference for rental housing) supports TAG's market entry in Poland. The Management Board expects that early market entry can give TAG a competitive advantage in terms of scope, market knowledge, market penetration, and market position.

TAG's medium-term growth target, i.e. by the end of 2025, is to build up a portfolio of approx. 8,000 to 10,000 residential units in Poland. Capital spending will be focused on new construction in large cities with favourable population trends, proximity to universities, and a well-developed infrastructure.