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Schroder European REIT Leases Additional Office Space In Hamburg
Schroder European Real Estate Investment Trust PLC
(Incorporated in England and Wales)
Registration number: 09382477
JSE Share Code: SCD
LSE Ticker: SERE
ISIN number: GB00BY7R8K77
8 October 2020
SCHRODER EUROPEAN REIT LEASES ADDITIONAL OFFICE SPACE IN HAMBURG
-Latest asset management success follows transformational c. €104 million disposal of Paris office asset-
Schroder European Real Estate Investment Trust plc ("SERE" or the "Company"), the company investing in
European growth cities, has completed a new five-year lease agreement for a further floor at
Hammerbrookstraße 94, its Hamburg office investment.
BAM Deutschland, the construction specialist, has taken the 8th floor which totals 646 sqm (c. 10% of the
lettable area), on a five year lease, which will generate an additional €104,500 of annual contracted rent. The
building is now 81% let to a diverse range of tenants, with the Company having leased five of the seven floors
vacated following the agreement of a lease surrender with the headline tenant, at a combined rent of 19% above
business plan and 12% above the ERV. The commencement of the lease will enhance the income return for the
investment by 0.6% and is expected to have a positive impact on 30 June 2020 valuation of c. 3% / €600,000.
The modern property is located in Hamburg’s fast growing City Sud district. The submarket’s appeal has
increased in recent years as a result of new residential and retail development, whilst the micro location benefits
from its proximity to a number of key arterial routes and Hammerbrook S-Bahn station, which is one stop for
Hamburg Hauptbahnh, the city’s main railway station.
Jeff O’Dwyer, Fund Manager, commented: “Despite the near-term impact of Covid-19 on occupational activity,
we continue to see demand from a range of tenants for well-located office space across our target Continental
European markets. Following on from the transformational Boulogne-Billancourt transaction announced last
week, it represents the latest successful example of our Winning Cities strategy, whilst further improving the
portfolio metrics.”
On 1 October 2020, SERE announced it had exchanged contracts to sell its Boulogne-Billancourt office asset in
Paris for approximately €104 million. The sale is structured as a forward funding, with the building being handed
over to the purchaser in H1 2022, following completion of a comprehensive refurbishment which is being
undertaken by the Company. The refurbishment and sale follows the agreement of a new 10-year pre-let
contract with existing tenant Alten in June this year at a rent 39% higher than the previous rent paid.
The sale delivers a profit of approximately €28 million, representing c.35% profit on cost and the net sale
proceeds strengthen the Company's balance sheet, providing significant operational and financial flexibility. The
funds will primarily be redeployed into new earnings enhancing initiatives including new investments.
Enquiries:
Jeff O’Dwyer / Duncan Owen
Schroder Real Estate Investment Management Limited Tel: 020 7658 6000
Ria Vavakis
Schroder Investment Management Limited Tel: 020 7658 2371
Dido Laurimore/Richard Gotla/Methuselah Tanyanyiwa
FTI Consulting Tel: 020 3727 1000
JSE Sponsor
PSG Capital
Date: 08-10-2020 08:00:00
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