ACQUISITION OF NECKARTENZLINGEN BUSINESS PARK
SIRIUS REAL ESTATE LIMITED
(Incorporated in Guernsey)
Company Number: 46442
JSE Share Code: SRE
LSE (GBP) Share Code: SRE
LEI: 213800NURUF5W8QSK566
ISIN Code: ISIN GG00B1W3VF54
1 December 2021
Sirius Real Estate Limited
("Sirius Real Estate", "Sirius" or the "Company")
SIRIUS ACQUIRES NECKARTENZLINGEN BUSINESS PARK FOR €34.5 MILLION
Sirius Real Estate, the leading owner and operator of branded business and industrial parks providing conventional space and flexible workspace in Germany and the UK, announces that it has completed the acquisition of a high-quality business park in Neckartenzlingen, south of Stuttgart, for a total cost of €34.5 million. The transaction, which was notarised in September 2021, will be financed using existing cash resources, and reflects an EPRA net initial yield of 5.6%.
As a result of this transaction Sirius has completed the acquisition of 254,100 sqm of business parks, industrial space, out of town office space and a land parcel across 9 assets in Germany this financial year, representing a total investment volume of €153.9 million. In addition, Sirius entered the UK market in November with the acquisition of BizSpace, a leading provider of regional light industrial, workshop, studio and out of town office units to a wide range of businesses for an enterprise value of £380 million.
The Neckartenzlingen business park asset comprises three mixed-use buildings, which Sirius is acquiring from two separate vendors, Hirschmann Electronics GmbH and Logwin Holding Immo Aschaffenburg GmbH. Built between 1955 and 1991 and previously held as one combined asset, the property has 54,515 sqm of gross lettable area and primarily comprises production space (36%), warehouse space (30%) and out of town offices (27%) as well as other uses (7%). There are 893 car parking spaces on site.
The business park is currently 80% let to two tenants in the electronics and communications sectors, at an average rent of €3.84 per sqm. The asset produces a total annualised rental income of circa €2.2 million and has a WALE (weighted average lease expiry) of 8.1 years, providing stable, long term cashflows with the opportunity to grow income through a range of asset management opportunities, including the leasing of the remaining c. 10,700 sqm of vacant space.
Neckartenzlingen is an industrial town close to Stuttgart. It lies around 16 km south of Stuttgart's airport and benefits from easy access to public transport and the B312 and B297 highways.
Commenting on the acquisition, Andrew Coombs, Chief Executive Officer of Sirius Real Estate, said: " This is a well-located asset acquired at an attractive price point and underpinned by a long WALE, providing a stable income from day one. At the same time, it is in line with our usual strategy of acquiring assets where there is an opportunity for us to add value through our platform driven asset management initiatives, such as reducing vacancy, while also benefiting from potential redevelopment opportunities.
" This will be the 9th German asset, including a land parcel, acquired by Sirius Real Estate in this financial year, bringing our total deployment to €153.9m, following an extremely active period for the business as we continue to build momentum across our key investment markets, while also extending our reach into the UK following our recent acquisition of the BizSpace platform. Following the success of two oversubscribed bond issuances and an equity capital raise in the last six months, Sirius' balance sheet remains strong and we are well positioned to continue to source attractive investment opportunities."
- ENDS -
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 and the UK. 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.
In November 2021, Sirius Real Estate announced and completed the acquisition of BizSpace, a leading provider of regional flexible workspace in the UK. BizSpace offers light industrial, workshop, studio and out of town office units to a wide range of businesses across the UK and the acquisition therefore provided Sirius with a unique opportunity to immediately enter, with scale, an under-served new market through a one-step acquisition of an established platform. It provides Sirius with a high-quality portfolio, offering significant organic growth potential in rental pricing in a UK market characterised by supply constraints. The BizSpace business is also highly complementary to Sirius' existing platform, allowing for meaningful operational and financial synergies to drive value creation for Sirius shareholders.
For more information, please visit: www.sirius-real-estate.com
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