Sirius re-invests fresh capital in four new German assets

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Sirius Real Estate, which focuses on German business parks with light industrial properties, said earlier this month that it had boosted annualised rental income by 2% to €65.2m for the six months to end-September.

In a fairly bullish statement, the company said the rental increases came as a result of its major capex investment programme converting under-used space into either prime lettable space or into one of the company's premium Smartspace products. Its own in-house brokering activities contributed to higher uptake, it said.

Following a recent capital raising of €25m, Sirius made four further acquisitions in September, including a business park in Krefeld, near Dusseldorf, for €9.2m, and a business park in Schenefeld, near Hamburg, for €15.1m (71% let). The company also acquired an office building asset in Hamburg-Hummelsbttel for €8.4m (vacant) and an office building in Frankfurt for €6.1m (87% let).

"Following the completion of the notarised acquisitions, we will own and manage a portfolio of 51 properties - 48 as at September 30th, 2017 - compared to 43 at the end of the first half of 2016, with more expected to follow in the second half of this financial year," Sirius CEO Andrew Coombs said.

"Economically, Germany is in a favourable position relative to other comparable economies. In the third quarter of this year, output in Germany expanded at its fastest pace since April 2011 supported by export gains and strong growth in manufacturing. This tallies with the strong occupational demand for the Company's mix of conventional and flexible workspace we are experiencing and we believe bodes well for the Company's strategy of acquiring assets with increased vacancy and higher value add opportunity."

Sirius Real Estate, which is jointly listed on the London and Johannesburg Stock Exchanges, recently produced strong full-year figures, boosting pre-tax profit by 34% to €76.4m from last year's €57.1m.