SIRIUS ACQUIRES THREE ASSETS FOR EUR45 MILLION
SIRIUS REAL ESTATE LIMITED
(Incorporated in Guernsey)
Company Number: 46442
JSE Share Code: SRE
LSE (GBP) Share Code: SRE
LEI: 213800NURUF5W8QSK566
ISIN Code: GG00B1W3VF54
2 November 2021
Sirius Real Estate Limited
("Sirius Real Estate", "Sirius" or the "Company")
SIRIUS ACQUIRES AN OFFICE AND TWO BUSINESS PARKS IN GERMANY FOR €45 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 completed the acquisition of an office and two business parks in Frankfurt, Erfurt and Essen, respectively, in separate transactions for a total consideration of approximately €45 million (total acquisition costs). The acquisitions have been made using the proceeds of the Company's €400 million oversubscribed corporate bond issuance in June 2021 and will add a further 44,000 sqm of primarily office and industrial space to the Company's 1.5 million sqm portfolio.
The acquisition in Frankfurt, Germany's main financial hub, is the Company's third in the city and comprises a multi-tenanted office with a total lettable area of approximately 10,000 sqm. The property has been purchased for total acquisition costs of €21.2 million and generates an annualised net operating income of €598,000. With occupancy at 54% and an average rent of 11.02 per sqm (excluding parking and other income) with a WAULT (Weighted Average Unexpired Lease Term) of
2.9 years, the property offers the opportunity for Sirius to use its platform to improve occupancy and income. The property benefits from its location close to two of the city's main autobahns and aligns to the Company's strategy of providing a range of flexible out of town office products that it expects to appeal to the local market.
Following on from the completion of the Company's first investment in Essen in May this year, Sirius has added further scale in this local market completing the purchase of an office and production space property for total acquisition costs of €12.2 million. The property comprises 11,709 sqm of lettable space and generates an annualised net operating income of €851,000, from an occupancy of 81%.
The final transaction comprises the completion of the acquisition of a 22,000 sqm multi tenanted business park with development land in Erfurt and represents the Company's first investment into this key logistics location. With total acquisition costs of €11.7 million, the park comprises 14,000 sqm of industrial space, 7,400 sqm of office space and 760 sqm of other space. The site generates €623,000 of annualised net operating income at 81% occupancy, presenting an opportunity to grow income through the letting of vacant space and potential investment into an 18,000 sqm development land parcel.
Commenting on the acquisition, Andrew Coombs, Chief Executive Officer of Sirius Real Estate, said: "Following our oversubscribed €400 million bond issuance in June, the business has retained its strong cash position, and remains well placed to continue to deliver on an attractive pipeline of acquisition opportunities. These three assets provide a strong mix of industrial, production, storage and out of town office space - with occupier demand for these types of assets remaining robust - while providing further potential to create value and grow income through asset management, improving sustainability and the letting of vacant space. These assets add to our existing operations in Essen and Frankfurt, whilst also growing our business into Erfurt, a key logistics location, as we continue to target strategic locations in Germany in order to generate sustainable returns on behalf of investors."
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 Johannesburg Stock Exchange. 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
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