Sirius agrees German business park acquisition

LSE (GBP) Share Code: SRE

Sirius Real Estate Limited

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

Sirius Real Estate agrees third German business park acquisition this year for €13.75 million

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 notarised the acquisition of a business park in Klipphausen, near Dresden, together with an adjacent land parcel for an acquisition price of €13.75 million (£11.73 million).

The acquisition has been made using the proceeds of November 2023's €165 million (£147 million) capital raise. It represents the third asset to be acquired by Sirius in Germany this calendar year, and the sixth asset to be acquired across both Germany and the U.K. in recent months.

The site has been acquired from a corporate owner occupier who plans to vacate the building, which is expected to be six months after completion. Sirius' plan is to convert the site, which currently comprises approximately 17,700 sqm of modern primarily light industrial and production space, into a multi-tenanted business park. Sirius' asset management platform has identified multiple parties interested in leasing space at the site, which in aggregate is already in excess of the site's entire leasable area. The plan is also to expand the park through the development of the adjacent 10,000 sqm land parcel which forms part of the acquisition.

In order to allow a smooth departure from the property, Sirius has granted the vendor a six-month lease, which can be extended by two months at their option, in return for a rent of €200k per month. This short-term lease will provide Sirius with valuable preparation time ahead of the vendor vacating, as well as contribute to the planned investment into the site.

The property is strategically located in the town of Klipphausen, near Dresden, which is the capital of the Saxony state in Germany. The business park sits within a highly desirable micro-location in the economically important "Silicon Saxony", a registered industry association of nearly 300 SME businesses, and benefits from good transport networks and connectivity. The Klipphausen asset will be the second business park owned and operated by the Company in or near Dresden, enabling Sirius to leverage a number of operational synergies alongside its local market expertise.

Andrew Coombs, Chief Executive Officer of Sirius Real Estate, commented: "This acquisition presents the Company with a strong value-add opportunity to grow income and value through our operating platform. We are encouraged that we already have multiple parties who have expressed leasing interest in the business park, representing in aggregate more than the entire space available. Additionally, the adjacent land parcel offers significant development potential in an area benefiting from extremely high occupier demand for light industrial, affordable assets in out-of-town locations.

"We are continuing to make good progress on our acquisition pipeline, following our well supported €165 million (£147 million) equity raise in November and remain extremely active in both Germany and the U.K., with this asset to be our third acquired in Germany this year, and our sixth at Group level since November. We have now committed to over €90 million (£77.1 million) of acquisitions in that time and are in advanced discussions on a further €60 million (£51.4 million) of additional opportunities, leaving us well placed to support the continued long-term growth of the Group."