26th Jul 2019 13:28
(Alliance News) - Business park and office operator Sirius Real Estate Ltd said Friday it has acquired two properties in Germany for a combined EUR51.7 million.
London and Johannesburg-listed Sirius bought the 197,000 square metre Alzenau Business Park for EUR44.5 million.
The Alzenau site - located 34 kilometres from Frankfurt - has 60,000 square metres of lettable space and over 1,000 parking spaces. It is currently 93.5% let to 16 tenants and generated annual total income of EUR4.1 million. The net initial yield on the purchase stands at 7.9%.
"The acquisition of Alzenau Business Park is the largest single transaction since the current management took over at Sirius, reflecting a broader range of asset size as well as an increased strength in the pipeline since the announcement of the Titanium JV," Chief Executive Andrew Coombs said.
"We were attracted to this acquisition because of the opportunity to acquire it at an attractive running yield, which will support our strategy to grow our funds from operations," Coombs added. "Furthermore, there is a good mix of long-standing tenants with strong covenants."
Sirius also bought an 3,300 square metre office in Bochum for EUR6.7 million, giving it a net initial yield of 5.5%. The office is adjacent to the Bochum business park which was bought by Sirius in March for EUR25.7 million.
The Bochum property is currently full let, generating EUR428,000 in annual income.
"Following on from the success of the other larger Bochum acquisition in March 2019, the acquisition of the adjacent property provides us with additional asset management possibilities as well as the opportunity to realise operational synergies", Coombs said.
Shares in Sirius were 0.6% lower at 67.60 pence in London on Friday, 0.8% higher at ZAR12.09 in Johannesburg.
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