SIRIUS REAL ESTATE LIMITED - Acquisition Of Two Business Parks For 29.8 Million And Update On The Pipeline

Release Date: 01/08/2018 12:20
Code(s): SRE
 
Wrap Text
Acquisition Of Two Business Parks For €29.8 Million And Update On The Pipeline

SIRIUS REAL ESTATE LIMITED

(Incorporated in Guernsey)

Company Number: 46442

Share Code: SRE

ISIN Code: ISIN GG00B1W3VF54


1 August 2018



                                       Sirius Real Estate Limited

                               ("Sirius Real Estate" or the "Company")

           Acquisition of two business parks for €29.8 million and update on the pipeline


Sirius Real Estate, the leading operator of branded business parks providing conventional space and
flexible workspace in Germany, announces that it has completed the acquisition of two business parks
in Friedrichsdorf, near Frankfurt, and in Fellbach, close to Stuttgart, for a total of €29.8 million
(including acquisition costs).

The acquisitions have been funded using a combination of capital raised from the placing in March
2018 and proceeds from asset disposals. In addition to completing the purchase of the Friedrichsdorf
and Fellbach sites, the Company has notarised the acquisition of a business park asset located in
Mannheim for €9.6 million, which is expected to complete in October.

The Company is also in exclusivity to acquire another €33.0 million asset and is therefore well
advanced in the deployment of the €100 million of acquisition capability it communicated to
shareholders in its year end results, announced on the 4 June 2018.

The property in Friedrichsdorf is a mixed-use business park comprising multi-let office and warehouse
space constructed in the 1980s and 1990s and is located 20km from Frankfurt. It has been acquired
from a consortium of private investors for a total consideration of €17.8 million, reflecting an EPRA
net initial yield of 7.1%. The 18,000 sqm site offers around 17,300 sqm of lettable space comprising
8,200 sqm of offices, 8,100 sqm of warehouse space and 1,000 sqm of other space.

The asset is currently 91.8% let to 18 tenants producing an annual rental income of €1.36 million,
equivalent to an average rent of €6.65 per sqm with a weighted average unexpired lease length
(WAULT) of 2.2 years. The attractive and well covenanted tenant base includes Axicorp, Bose and
Peiker.

The property in Fellbach is a mixed-use business park comprising multi-let office and warehouse space
built between the 1960s and 1980s. It has been acquired from an institutional investor for a total
consideration of €12.1 million, reflecting an EPRA net initial yield of 7.3%. The 20,300 sqm site provides
around 25,500 sqm of lettable space, comprising 2,100 sqm of offices, 15,100 sqm of warehouse space
and 8,300 sqm of other commercial space.
The asset is currently 79.0 % let to 19 tenants, including Daimler AG, Deutsche Post and Landesbank
Baden-Württemberg and located 8km from Stuttgart. We believe there is significant potential to
increase occupancy and rental levels across the site through our asset management process.

As Sirius Real Estate already operates five business parks around Stuttgart and eight around Frankfurt,
the new assets are expected to benefit from operational synergies with the wider group.

Andrew Coombs Chief Executive Officer of Sirius Real Estate, said: "Located in the Frankfurt and
Stuttgart areas, two of the commercial markets where we have extensive experience, the
Friedrichsdorf and Fellbach assets provide plenty of opportunities to enhance income and capital
value through our unique approach to asset management, which includes marketing space directly to
businesses actively looking for space.

“These acquisitions were funded using a combination of capital raised from a placing earlier this year
and proceeds from asset disposals. We continue to have significant financial resources at our disposal
to pursue further earnings accretive targets.”


For further information:

Sirius Real Estate

Andrew Coombs, CEO

Alistair Marks, CFO

+49 (0)30 285010110


Tavistock (financial PR)

Jeremy Carey

James Verstringhe

+44 (0)20 7920 3150

siriusrealestate@tavistock.co.uk


NOTES TO EDITORS

About Sirius Real Estate

Sirius is a property company listed on the main market and premium segment of the London Stock
Exchange and the main board of the Johannesburg Stock Exchange. It is a leading operator of branded
business parks providing conventional space and flexible workspace in Germany. The Company's core
strategy is the acquisition of business parks at attractive yields, the integration of these business parks
into its network of sites under the Company's own name as well as offering a range of branded
products within those sites, and the reconfiguration and upgrade of existing and vacant space to
appeal to the local market, through intensive asset management and investment. The Company's
strategy aims to deliver attractive returns for shareholders by increasing rental income and improving
cost recoveries and capital values, as well as by enhancing those returns through financing its assets
on favourable terms. Once sites are mature and net income and values have been optimised, the
Company may take the opportunity to refinance the sites to release capital for investment in new sites
or consider the disposal of sites in order to recycle equity into assets which present greater
opportunity for the asset management skills of the Company's team.

For more information, please visit: www.sirius-real-estate.com

Follow us on LinkedIn at https://www.linkedin.com/company/siriusrealestate/

Follow us on Twitter at @SiriusRE


LEI: 213800NURUF5W8QSK566

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