Sirius Real Estate Ltd was given a ‘buy’ rating from Berenberg following the sale of a business park for £16mln on Monday.
The purchase price for the Camberwell property, which was formerly owned by BizSpace before it was bought by Sirius in November, implied a net initial yield of 2%, the property investment company said.
The disposal marked an apparent 94% premium to the valuation at the time of Sirius’ takeover of BizSpace, Berenberg commented. The broker then added the integration was “progressing well.”
Sirius will likely continue to grow in the UK and Germany, as well as simultaneously following a capital recycling strategy by offloading low-yielding properties with high rental and occupancy levels, it said.
Finally, Berenberg said it believes Sirius’ like-for-like rental growth, at 7.5% in the UK and 6.4% in Germany, is set to remain positive.
Berenberg has a price target of 142p, a 25% premium on its price in London on Monday.