Sirius Real Estate has acquired an office and two business parks in Frankfurt, Erfurt, and Essen, in separate transactions for €45 million.
The proceeds from the company’s €400 million oversubscribed corporate bond issuance in June 2021 were used to fund the acquisition which will add a further 44 000m2 of office and industrial space to its 1.5 million square metre portfolio.
The acquisition in Frankfurt is Sirius’ third in the city and comprises of a multi-tenanted office with a total lettable area of approximately 10 000m2 and it was purchased for a total of €21.2 million. The property generates an annualised net operating income of €598 000 with its occupancy currently at 54% and an average rent of €11.02 per square metre (excluding parking and other income). With a Weighted Average Unexpired Lease Term (WAULT) of 2.9 years, the property benefits from its location close to two of the city’s main autobahns.
Following on from the company’s first investment in Essen in May 2021, Sirius purchased an office and production asset for €12.2 million which comprises of 11 709m2 of lettable space, generating an annualised net operating income of €851 000 from an occupancy of 81%.
The final transaction includes the acquisition of a 22 000m2 multi-tenanted business park with development land in Erfurt, representing the company’s first investment in the key logistics location. With a total acquisition cost of €11.7 million, the park comprises of 14 000m2 of industrial space, 7 400m2 of office space and 760m2 of other space. The site generates €623 000 of annualised net operating income at 81% occupancy.
“Following our oversubscribed €400 million bond issuance in June, the business has retained its strong cash position, and remains well placed to continue to deliver on an attractive pipeline of acquisition opportunities. These three assets provide a strong mix of industrial, production, storage and out of town office space – with occupier demand for these types of assets remaining robust – while providing further potential to create value and grow income through asset management, improving sustainability and the letting of vacant space. These assets add to our existing operations in Essen and Frankfurt, whilst also growing our business into Erfurt, a key logistics location, as we continue to target strategic locations in Germany to generate sustainable returns on behalf of investors”, commented CEO of Sirius, Andrew Coombs.
