REG - Sirius Real Estate - Sirius completes on £31m of U.K. acquisitions

Sirius Real EstateAnnouncement

20/06/2024 07:00

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RNS Number : 1209T  Sirius Real Estate Limited  20 June 2024

SIRIUS REAL ESTATE LIMITED

(Incorporated in Guernsey)

Company Number: 46442

JSE Share Code: SRE

LSE (GBP) Share Code: SRE

LEI: 213800NURUF5W8QSK566

ISIN Code: GG00B1W3VF54

 

20 June 2024

Sirius Real Estate Limited

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

 

Sirius Real Estate completes on c. £31 million of acquisitions and disposes
of two assets in the U.K.

 

Sirius Real Estate, the leading owner and operator of branded business and
industrial parks providing conventional space and flexible workspace in
Germany and the U.K., has completed on the acquisitions of two industrial
assets in the U.K., in Banbury, South East England, and Wembley, for just over
£31 million, representing a 9.2% net initial yield ("NIY") including
acquisition costs.

 

The acquisitions will add more than 492,000 sq ft of light industrial space to
the Group's U.K. portfolio, and have been made using the proceeds of the
recent Maintal disposal, which was sold at a gross yield of 6% for €40.1
million in March 2024.

 

The Banbury acquisition comprises the c. 473,000 sq ft Beaumont Industrial
Estate, which has exchanged for £25 million (excluding acquisition costs),
reflecting a NIY of 9.1%. The freehold asset, which is fully let to two
tenants on Full Repairing and Insuring leases, produces a net operating income
of £2.4 million per annum at an average rate of £5.15 psf, with both leases
expiring in July 2027. Both tenants are expected to extend their leases given
the significant investment in production equipment on site by each tenant.

 

The second asset comprises a light industrial multi-let building in Wembley,
which has exchanged for just under £6.3 million (excluding acquisition costs)
reflecting a NIY of 9.3%. The property is freehold and spans 19,145 sq ft of
lettable space. At almost 100% occupancy, the asset currently generates a net
operating income of £624,000. Privately owned and operated, and situated at
the northern end of Water Road, approximately 6 miles west of Central London,
the site is strategically located to complement a trio of properties that the
Company recently acquired in Islington. The current owner purchased the vacant
property three years ago and converted the building into 65 workspaces
targeting SMEs.

 

Both of the assets are located in highly desirable locations and benefit from
good transport networks and connectivity, with the Wembley asset located
within 5 miles of Bizspace in Perivale, enabling the Company to leverage a
number of operational synergies alongside its local market expertise.

 

Sirius has identified a number of opportunities to drive value through the
Banbury and Wembley assets by utilising its asset management platform to
improve occupancy, income and service charge recovery. Both sites fall within
the Company's strategy of purchasing primarily industrial assets, and will
allow Sirius to continue its asset recycling programme.

 

Separately, the Company announces that it has notarised the disposals of two
sub scale assets located in Hartlepool and Letchworth, U.K., for a combined
total of £1.9 million. The assets, which comprise just over 60,500 sq ft of
space, were sold at a combined 2.7% premium to the last reported book value
and were both deemed non-core to the business going forwards.

 

Andrew Coombs, Chief Executive Officer of Sirius Real Estate, commented:
"These acquisitions present the Company with a number of value-add
opportunities to utilise the Sirius platform to grow income and value across
two strategic locations in the U.K., including one in which we already have an
established presence. Additionally, the strategic disposal of two non-core
U.K. sites, which when combined, were achieved at a modest premium to book
value, allows us to crystallise returns from these assets which we will look
to recycle into sites with larger scale and more opportunity."

 

"We are continuing to make good progress on our acquisition pipeline,
following on from six months of active investments in both Germany and the
U.K.. The Company's bond tap of its 1.75% corporate bond due in November 2028,
alongside advanced discussions on additional opportunities, leaves us well
funded and well placed to support the further long-term growth of the Group."

 

 

For further information:

Sirius Real Estate

Andrew Coombs, CEO / Chris Bowman, CFO

+49 (0) 30 285 010 110

 

FTI Consulting (Financial PR)

Richard Sunderland / Ellie Sweeney/ James McEwan / Talia Shirion

+44 (0) 20 3727 1000

SiriusRealEstate@fticonsulting.com

 

NOTES TO EDITORS

 

About Sirius Real Estate

Sirius is a property company listed on the main and premium market of the
London Stock Exchange and the main board of the JSE Limited. It is a leading
owner and operator of branded business and industrial parks providing
conventional space and flexible workspace in Germany and the U.K. As of 31
March 2024, the Group's portfolio comprised 142 assets let to 9,654 tenants
with a total book value of over €2.1 billion, generating a total annualised
rent roll of €188.7 million. Sirius also holds a 35% stake in Titanium, its
€350+ million German-focused joint venture with clients of AXA IM Alts.

 

The Company's strategy centres on acquiring business parks at attractive
yields and integrating them into its network of sites - both under the Sirius
and BizSpace names and alongside a range of branded products. The business
then seeks to reconfigure and upgrade existing and vacant space to appeal to
the local market via intensive asset management and investment and may then
choose to refinance or dispose of assets selectively once they meet maturity,
to release capital for new investment. This active approach allows the Company
to generate attractive returns for shareholders through growing rental income,
improving cost recoveries and capital values, and enhancing returns through
securing efficient financing terms.

 

For more information, please visit: www.sirius-real-estate.com
(http://www.sirius-real-estate.com/)

 

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

 

Follow us on X (Twitter) at @SiriusRE

 

JSE Sponsor

PSG Capital

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