Sirius Real Estate (LON: SRE), the leading operator of branded business parks providing conventional space and flexible workspace in Germany, announced today that it has acquired an office complex in Hallbergmoos, near Munich Airport, for €20.2 million (including acquisition costs). The vendor is KCM Invest AG, a Munich based investment firm.
Constructed in 1993, the property is located on Lilienthalstrasse in Hallbergmoos which is 29 km northeast of Munich, where Sirius already owns two business parks. It provides a total of 19,600 sqm of net lettable space (16,300 sqm of office, 2,200 sqm of warehouse and 1,100 sqm of other space), over three floors, together with 336 parking spaces on a total plot size of 14,943 sqm.
The asset is 55% let to 28 tenants, producing an annual rental income of € 960,000 at an average rate of €6.67 per sqm and a remaining WALT of 2.4 years. Tenants include Heinz von Heiden GmbH, Mentor Deutschland GmbH and Dorma Time + Access GmbH. The purchase price (including acquisition costs) reflects an EPRA net initial yield of 3.4% owing to the 45% vacancy in the building.
The asset is being acquired on an unencumbered basis, funded by a combination of funds generated from the disposal of five Sirius assets to the Titanium joint venture with AXA Investment Managers – Real Assets and from the recent extension of the Berlin Hyp Amber bank facility.
Commenting on the acquisition, Andrew Coombs, Chief Executive Officer of Sirius Real Estate, said:
“This asset fits well with our acquisition criteria, in particular the low capital value, the level of vacancy within the building and the low average rent compared to the local market. It offers a great opportunity to add significant value by playing to the strengths of our integrated business model and track record of maximising occupation and growing rental levels.”