EUR11m Sale of Dusseldorf Asset

RNS Number : 5168A

Sirius Real Estate Limited

24 March 2017

 

The Company considers this announcement to contain inside information which is disclosed in accordance with the Market Abuse Regulation

 24 March 2017

Sirius Real Estate Limited

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

€11m Sale of Dusseldorf Asset

Sirius Real Estate, the leading operator of branded business parks providing conventional space and flexible workspace in Germany, is pleased to announce that it has notarised the sale of its business park in Wiesenstrasse, Dusseldorf for €11 million.

The Dusseldorf asset has been fully developed under the Sirius brand and with occupancy now at 96.2% is considered a mature asset within the Company's portfolio. It intended that the proceeds of the sale be recycled into new assets with greater total return opportunity.

Since this site was acquired in 2008, Sirius's asset management activity has significantly improved the tenant mix and lease terms.  The sale price of €11 million represents a 25% premium to the site's book value of €8.7 million as at 30 September 2016 and an EPRA net initial yield for the purchaser of 7.2% (including acquisition costs).  The purchaser is a German institutional fund.

There is a secured loan of around €3.9 million outstanding on the asset. Under the terms of the loan Sirius has the option of substituting other assets into the facility in place of the Dusseldorf asset, which it expects to do.

The sale will add to the Company's cash resources and provide further support for acquisitions whilst maintaining the Company's stated LTV target of 40%.  Sirius continues to see a healthy acquisition pipeline of assets on which it can use its asset management skills to drive value for shareholders.

Andrew Coombs Chief Executive Officer of Sirius Real Estate, said, "The Dusseldorf business park has been a good asset for Sirius, we have added to the income and capital values of the site and taken it to maturity and it is pleasing now to be able to recycle the capital we have created into opportunities with greater scope to increase total returns for our shareholders."

Enquiries:

Sirius Real Estate                                                                             [phone]             

Andrew Coombs, CEO

Alistair Marks, CFO        

Peel Hunt                                                                                            [phone]

Capel Irwin 

Edward Fox         

Canaccord Genuity Limited                                                         [phone]

Charlie Foster

Bruce Garrow

Chris Connors

Ben Griffiths                                                                                 

JSE Sponsor: PSG Capital                                                               [phone]

David Tosi                                                                                                   

Willie Honeyball

Novella                                                                                                [phone]

Tim Robertson

Toby Andrews

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 risk adjusted 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, Sirius may consider their disposal in order to recycle equity into assets which present greater opportunity for the Group's asset management skills.

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

 

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