Sirius Real Estate Limited Acquisition (9944J)

TIDMSRE

RNS Number : 9944J

Sirius Real Estate Limited

04 July 2017

The Company considers this announcement to contain inside information which is disclosed in accordance with the Market Abuse Regulation

4 July 2017

Sirius Real Estate Limited

("Sirius Real Estate", "Sirius" or the "Company")

Update on Acquisitions

Sirius Real Estate, a leading operator of branded business parks providing conventional space and flexible workspace in Germany, is pleased to announce the completion of the acquisition of two properties for a combined total acquisition cost of EUR24.5 million.

On 1 July 2017, the Group completed the acquisition of Berlin-Mahlsdorf II. The property is a mixed used building, in a commercial area 15 km east of the centre of Berlin and adjacent to an existing Sirius site in Berlin-Mahlsdorf. The site offers 12,826 square metres of gross lettable space, of which 68% is office space, 18% is retail space and 14% is warehouse space. The building is currently 62.2% occupied, is let to 19 tenants producing an annual income of EUR0.5 million and has a remaining weighted average lease term of 6.1 years. The demand and take-up of the vacancy in Sirius's adjacent site has been high and the site is quickly approaching full occupancy, which is encouraging for the prospects of the new site. The property was acquired for EUR6.4 million including acquisition costs.

Also, on 1 July 2017, the Group completed the acquisition of Grasbrunn. The site is located in a well-developed commercial area close to Munich and comprises four office buildings with a gross lettable area of 14,791 square metres. Currently the property is only 3.5% occupied (let to one tenant), producing an annual income of EUR0.1 million with a remaining lease term of 1.7 years. This acquisition provides Sirius with an excellent opportunity to increase the value of the asset through investing into and letting up the vacant space for which the Group's marketing team has already registered significant tenant interest. The property was acquired for EUR18.1 million including acquisition costs.

Funding for these transactions will come from the proceeds received from the recent disposals of mature assets.

Andrew Coombs Chief Executive Officer of Sirius Real Estate, said,

"It is pleasing to be able to recycle the equity released from our recent disposals into these two excellent assets with such strong future potential. Each site is well located and provides scope for us to increase passing rents and capital values. We have excellent understanding of both local markets and know the types of space that will appeal there. We look forward to incorporating these into the Group's portfolio."

 
 For further information, please contact: 
 
  Sirius Real Estate                           [phone] 
 Andrew Coombs, CEO 
  Alistair Marks, CFO 
 
 Novella                                     [phone] 
 Tim Robertson 
  Toby Andrews 
 

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 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 risk adjusted 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, Sirius may consider their disposal in order to recycle equity into assets which present greater opportunity for the Group's asset management skills.

For more information, please visit: www.sirius-real-estate.com

This information is provided by RNS

The company news service from the London Stock Exchange

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July 04, 2017 02:00 ET (06:00 GMT)