REG - Sirius Real Estate - ACQUISITION OF NECKARTENZLINGEN BUSINESS PARK

Sirius Real EstateAnnouncement

01/12/2021 07:00

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RNS Number : 1157U  Sirius Real Estate Limited  01 December 2021

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

Follow us on LinkedIn at https://www.linkedin.com/company/siriusrealestate/

Follow us on Twitter at @SiriusRE

JSE Sponsor

PSG Capital

 

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