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Sirius Real Estate acquires German business park for €34.5mln

Published: 07:49 01 Dec 2021 GMT

Sirius Real Estate Ltd - Sirius Real Estate acquires business park in Neckartenzlingen (south of Stuttgart)

Sirius Real Estate Ltd (LSE:SRE, JSE:SRE) completed the acquisition of a business park in Neckartenzlingen, south of Stuttgart, for a total cost of €34.5mln.

The transaction will be financed using existing cash resources and reflects an EPRA (industry standard) net initial yield of 5.6%, the owner and operator of branded business and industrial parks said.

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 square metres (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 cash flows 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.

“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,” said Andrew Coombs, the chief executive officer of Sirius Real Estate.

"This will be the ninth 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's balance sheet remains strong and we are well-positioned to continue to source attractive investment opportunities,” he added.

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on 10/10/23