TIDMSRE
RNS Number : 9530I
Sirius Real Estate Limited
18 August 2021
SIRIUS REAL ESTATE LIMITED
(Incorporated in Guernsey)
Company Number: 46442
JSE Share Code: SRE
LSE (GBP) Share Code: SRE
LEI: 213800NURUF5W8QSK566
ISIN Code: GG00B1W3VF54
18 August 2021
Sirius Real Estate Limited
("Sirius Real Estate", "Sirius" or the "Company")
SIRIUS ACQUIRES FOUR BUSINESS PARK ASSETS & LAND PARCEL FOR
EUR84.8 MILLION
Sirius Real Estate, the leading owner and operator of branded
business and industrial parks providing conventional space and
flexible workspace in Germany, announces it has notarised or
completed the acquisition of four business park assets and one land
parcel for a total of approximately EUR84.8 million (total
acquisition costs).
The acquisitions are located in Oberhausen, Frankfurt,
Heiligenhaus and Öhringen and provide over 150,000 sqm of lettable
space. In addition, the Company has acquired a land parcel adjacent
to its existing asset in Neuruppin. The properties have been
acquired using proceeds of the Company's inaugural EUR400.0 million
corporate bond issuance that successfully completed in June
2021.
Together the acquisitions* generate day one net operating income
(NOI) of EUR3.4 million per annum, representing a blended EPRA net
initial yield of 4.1% at occupancy of 59%. With 62,000 sqm of
vacant space, the assets provide an opportunity to grow income
through the letting up of vacant space, accretive refurbishment and
selective development.
* excluding the land parcel
Commenting on the acquisitions, Andrew Coombs, Chief Executive
Officer of Sirius Real Estate, said: "With our strong cash
position, Sirius continues to deliver on an attractive pipeline of
opportunities generated by our in-house acquisitions team. The new
assets provide a mix of warehouse, production, and office space
that we know works well for our platform and our customers. The
assets are in well-established locations that benefit from strong
SME demand and growth potential, as well as synergies with existing
Sirius business park sites.
"Whilst the assets primarily represent an opportunity for the
company to utilise its operating platform to drive the take up of
lettable space and reduce service charge leakage, significant
refurbishment and development opportunities also exist to provide
further potential for value creation."
Further details on the acquisitions are set out below:
Oberhausen
The Company has notarised the acquisition of Oberhausen Business
Park for EUR39.8 million (total acquisition cost). The park is
located in a well-developed commercial area of the city of
Oberhausen, in the northwest of Germany's Ruhr region. The asset
offers a mix of uses with approximately 77,600 sqm of lettable
space, comprising around 47,400 sqm of offices, 19,200 sqm of
warehouse space, 4,600 sqm of storage and 6,400 sqm of other
space.
The property generates NOI of EUR2.33 million per annum, with an
average rent of EUR3.29 per sqm (excluding parking and other
income), reflecting an EPRA Net Initial Yield of 5.9% at 63%
occupancy. The asset has a remaining Weighted Average Lease Expiry
("WALE") of 3.2 years. Completion is expected to be in Q4 of
calendar year 2021.
Oberhausen Business Park offers attractive day one cash flow for
Sirius, but also the potential to grow income by letting vacant
space with the support of targeted investment and
refurbishment.
Frankfurt III
The Company has notarised the acquisition of its third asset in
Frankfurt, for EUR21.2 million (total acquisition cost),
representing an EPRA Net Initial Yield of 2.8% with occupancy at
54%.
The multi-tenanted office tower offers 15 floors of lettable
space, comprising around 9,300 sqm of office and 900 sqm of storage
space. The building generates NOI of EUR598,000 per annum at an
average rent of EUR11.02 per sqm (excluding parking) and has a
remaining WALE of 2.9 years. Completion is expected to be in Q4 of
calendar year 2021.
Key tenants of the building include ENGIE, the international
energy business. Located in the east of the city of Frankfurt, the
building benefits from its location close to two of the city's main
Autobahns and supports the Company's strategy of providing a range
of flexible out of town office products that it expects to appeal
to the local market.
Heiligenhaus
The Company has notarised a multi-tenanted business park at
Heiligenhaus, North Rhine-Westphalia, for EUR14.2 million (total
acquisition cost). The property has a lettable area of
approximately 45,000 sqm, consisting of around 23,200 sqm of office
space, 11,400 sqm of warehouse space, 7,800 sqm of production space
and 2,600 sqm of other space.
The asset currently generates NOI of EUR1.12 million per annum,
with an average rent of EUR2.44 per sqm (excluding parking and
other income), representing an attractive EPRA Net Initial Yield of
7.9%. The asset is currently 77.2% let with a WALE of 3.7 years.
Completion is expected to be in Q4 of calendar year 2021.
One of the key tenants is Kiekert Aktiengesellschaft, which
provides safety systems for the automotive sector. The Company aims
to increase operating income through the letting of vacant space
and improving service charge collection.
Located to the west of the town of Heiligenhaus, the business
park is situated between the cities of Essen, Duisburg, Dusseldorf
and Wuppertal, with strong Autobahn and public transport links. A
new Autobahn connection is due to be created to connect
Heiligenhaus and nearby Ratingen.
Öhringen
Öhringen Business Park was acquired for EUR9.02 million (total
acquisition cost) on 1 August 2021. Located in the town of Öhringen
in Baden-Württemberg, the business park is well-connected by road
and public transport. The asset offers a lettable area of
approximately 18,000 sqm comprising around 15,800 sqm of warehouse
space, 1,500 sqm of office space and 700 sqm of other space, as
well as a potential development land parcel of around 11,600
sqm.
The asset has strong value-add potential, with vacant,
marketable warehouse space, and provides a development opportunity
for further light industrial space.
The business park has been acquired with vacant possession, but
with a new lease already agreed with Filtration Group GmbH, an
international filtration systems business, which currently occupies
an adjacent property. Filtration Group will take up approximately
50% of the vacant space on an initial five-year term generating an
annual rent of EUR490,000 and an NOI of around EUR224,000.
Neuruppin
The Company has also completed the notarisation of an
approximately 16,000 sqm land parcel adjacent to its asset in
Neuruppin for EUR0.5 million (total acquisition cost), to assist in
its plans to expand and develop the existing property. Sirius is
engaged in negotiations with the current tenant regarding the
extension and a possible new lease for the additional developed
space.
For further information:
Sirius Real Estate
Andrew Coombs, CEO / Alistair Marks, CFO
+49 (0) 30 285010110
FTI Consulting (Financial PR)
Richard Sunderland / Claire Turvey / James McEwan / Talia
Jessener
+44 (0) 20 3727 1000
SiriusRealEstate@fticonsulting.com
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 JSE Limited. It is a leading operator of branded business parks
providing conventional space and flexible workspace in Germany. The
Company's purpose is to create and manage optimal workspaces that
empower small and medium-sized businesses to grow, evolve and
thrive. Sirius seeks to unlock the potential of its people, its
properties, and the communities in which it operates, so that
together we can create sustainable impact, and long-term financial
and social value.
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.
Sirius also has a venture with clients represented by AXA IM
Alts. Titanium was formed through the acquisition by AXA IM Alts,
on behalf of its clients, from Sirius, of a 65% stake in five
business parks across Germany. Sirius retained the remaining 35%.
The venture seeks to grow primarily through the acquisition of
larger stabilised business park assets and portfolios of assets
with strong tenant profiles and occupancy. As well as its equity
interest, Sirius acts as operator of the assets in the venture, on
a fee basis. Sirius will continue to grow its wholly owned
portfolio through acquisitions of more opportunistic assets, where
it can capitalise on its asset management expertise to maximise
utilisation of the space, grow occupancy and improve quality of the
tenants. The strategies have been clearly defined so that the
venture does not conflict with Sirius's existing business.
For more information, please visit:
www.sirius-real-estate.com
Follow us on LinkedIn at
www.linkedin.com/company/siriusrealestate
Follow us on Twitter at @SiriusRE
JSE Sponsor
PSG Capital
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