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SIRIUS REAL ESTATE LIMITED - Sirius completes acquisition of business park in Bochum

Release Date: 14/03/2019 09:00
Code(s): SRE     PDF:  
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Sirius completes acquisition of business park in Bochum

SIRIUS REAL ESTATE LIMITED
(Incorporated in Guernsey)
Company Number: 46442
JSE Share Code: SRE
LSE (GBP) Share Code: SRE
LSE(EUR) Share Code: ESRE
ISIN Code: ISIN GG00B1W3VF54


14 March 2019

                                       Sirius Real Estate Limited

                          ("Sirius Real Estate", “Sirius” or the "Company")


                      Sirius completes acquisition of business park in Bochum

Sirius Real Estate, the leading operator of branded business parks providing conventional space and
flexible workspace in Germany, has completed the acquisition of a business park in Bochum in the
Ruhr region of Germany, for a total consideration of €25.7 million, equating to an EPRA net initial yield
of 8.9%. The vendor is a fund managed by DOBA-Grund Beteiligungs, Munich, part of Doblinger Group,
a German based development company. The acquisition, notarised in November 2018, has been
funded using a combination of capital raised from the placing in March 2018 and a part of a
€56 million, five year debt facility with a total all-in fixed interest rate of 1.4%, from pbb Deutsche
Pfandbriefbank.

The business park consists of approximately 56,000 sqm of mixed use lettable space of which 65% is
warehouse, 29% is office and 6% is other space. The site will initially generate €2.6m of gross rental
income with 95% occupancy, let to 31 tenants including Pilkington, a subsidiary of the Japan-based
NSG Group; and GfR, a telecommunication and call centre operator that is part of Thomas Cook Group.

The site was acquired with a high yield because Pilkington will be vacating the 26,600 sqm that it
occupies at the end of its lease on 31 May 2019. However, Sirius has already signed a new lease
commencing on 1 June 2019 on 12,600 sqm of the space being vacated, at a higher rent per sqm and
with fixed annual uplifts. The new lease which terminates on 31 May 2026, has been taken by the
Eickhoff Group, a global, family owned business which mainly manufactures machinery and gearing
technology for the mining and wind turbine industries. Eickhoff will be taking immediate occupation.

Bochum is located mid way between Dortmund and Essen, in North Rhine-Westphalia, the third-
largest urban area in the European Union. The property is well situated in Bochum-Hofstede, north
of the city centre and within walking distance of a U-Bahn with easy access to the A40 and A43
motorways.

Andrew Coombs, Chief Executive Officer of Sirius Real Estate, said: “This acquisition is our first
foothold in the important Ruhr area which is one the major industrial regions of Germany. With
relatively low site density, a flexible multi-tenant structure, the opportunity to replace the exiting
major tenant and stabilise the rent roll in an area where take up is robust and rents are growing, this
site is an exciting value-add opportunity for Sirius.

“This acquisition plays to the strengths of our integrated business model and track record of
generating tenant demand, maximising space usage and achieving management efficiencies.
“We have already generated strong interest in this park and believe re-letting of the balance of the
Pilkington space will be achieved ahead of business plan.”



For further information:

Sirius Real Estate

Andrew Coombs, CEO/Alistair Marks, CFO

Tel: +49 (0)30 285010110



Tavistock (Financial PR)

Jeremy Carey/James Verstringhe

Tel: +44 (0)20 7920 3150

Email: 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.

On 1 March 2019, Sirius announced that, in a transaction anticipated to complete in June 2019, it had
formed a real estate investment joint venture with clients represented by AXA Investment Managers
- Real Assets in which AXA acting on behalf of its clients, will own a 65% interest and Sirius will own
the balance of 35%. The JV is called Titanium. The JV will initially be formed by AXA acquiring, on behalf
of its clients, from Sirius a 65% stake in five SPVs through which it currently owns two business parks
located in Berlin (Berlin Borsig and Berlin Tempelhof) and one in each of Mainz, Nurnberg and
Bayreuth. The business parks provide a combination of office, warehouse, industrial and storage
space. The implied property value of €168 million equates to a gross yield for the portfolio of 6.2%
and reflects a premium to the last reported book value as at 30 September 2018 which was
€141.1 million. Total cash commitment from AXA IM - Real Assets amounts to €43.9 million. The
transaction is expected to generate total cash proceeds of more than €70 million for Sirius after
refinancing and expected related costs.

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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