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German Real-Estate Shares Fall After Moody’s Cuts Vonovia Rating

By Ed Frankl

Shares in German real estate companies fell on Wednesday after rating agency Moody’s downgraded Vonovia SE’s investment grade.

Moody’s downgraded the Bochum-based company to Baa1 from A3, albeit with an outlook that remains stable, as rising interest rates have weakened the outlook for property valuations and will significantly increase the cost of debt.

By 1145 GMT, shares in Vonovia, its subsidiary Deutsche Wohnen SE, LEG Immobilien SE and TAG Immobilien AG were down 4.8%, 3.3%, 4.9% and 5.9% respectively.

The more cautious stance of Moody’s and other credit rating agencies is “entirely understandable” and Vonovia may be able to speed up its progress in reducing its debt, analysts at Berenberg said in a note.

Peer rating agency S&P gives Vonovia a BBB+ rating.

Write to Ed Frankl at

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