Sirius Real Estate Limited (LON:SRE) said it has completed transactions for three business parks in Germany totalling EUR26mln (GBP23.3mln) which it said will generate a total of EUR1.9mln (GBP1.7mln) of annualised net operating income.
The FTSE 250 firm said the acquisitions comprise two previously announced purchases in Norderstedt, Hamburg for EUR9.1mln and Nuremberg for EUR13.7mln as well as a new acquisition for EUR3.2mln immediately adjacent to its existing Mannheim II business park.
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Sirius said the acquisitions have been acquired at an “attractive” blended net initial yield excluding costs of direct vacancy of 7.2% and will provide a mix of around two-thirds production and storage space and one-third out-of-town office space. The group added that it acquired all the properties using existing cash resources and that it has “significant finance available to acquire additional assets”.
The firm continued, saying the new asset adjacent to Mannheim II, which was purchased for EUR3.2mln (GBP2.9mln), comprises around 3,000 square metres of out-of-town office and storage space and is currently 93% occupied generating an annualised gross income of EUR235,226.
“Our most recent acquisitions at Mannheim, Norderstedt and Nuremberg see us drawing on Sirius’s on the ground knowledge of local markets to acquire assets at attractive yields offering a combination of secure income and value-add potential. These business parks are immediately accretive to earnings and signal a return to acquisitive growth for the company after holding back whilst assessing the impact of Covid-19 on the marketplace. Two thirds of the total space acquired relates to production and storage space whilst the remaining office space provides the company with the opportunity to offer its high yielding out-of-town flexible office products”, Sirius chief executive Andrew Coombs said in a statement.
“Our latest acquisition in Mannheim’s Kafertal commercial area provides significant operational synergies and we believe there is potential to unlock value when we consider the asset alongside our existing adjacent business park, Mannheim II. As we enter the new year, we continue to benefit from a strong cash position and are focused on executing our healthy pipeline of further acquisitions”, he added.