Sirius Real Estate grows rental income as occupancy rates improve

Posted On Wednesday, 08 April 2015 17:17 Published by
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Sirius Real Estate grows rental income as occupancy rates improve.

 

Andrew Coombs

Sirius Real Estate, the dual listed operator of branded business parks providing conventional space and flexible workspace in Germany, reports that annualised rental income on pre-acquisition portfolio increased by 5.6% to €43.6 million for the 31 March 2015 financial year. 

According to the company’s trading statement, annualised rental income of the pre-acquisitions portfolio increased by 5.6% to €43.6 million (31 March 2014 €41.3 million) with occupancy increasing by 2% to 78%. Pre-acquisitions portfolio excludes the acquisitions in Potsdam, Mahlsdorf, Bonn and Aachen announced previously and the Cottbus asset which was sold on 13 November 2014. 

On 5 December 2014, Sirius Real Estate achieved a successful dual listing on the AltX of the Johannesburg Stock Exchange. The Company raised €40 million to support the expansion of the property portfolio and has since announced the acquisition of 4 business parks for a total consideration of €70.7 million, with a net initial yield of 8.1%. A new €36 million debt facility from BerlinHyp has been fully drawn down against 3 of the 4 business parks with an interest rate of 2.85% fixed for 5 years.  The portfolio now extends across 33 business parks within which there are over 330 individual buildings comprising over 1 million sqm of lettable space. 

Andrew Coombs, CEO of Sirius Real Estate, commented, “This has been a very successful period for the business and our task now is to continue this positive momentum. This means continuing to grow the rent roll at improved average rental rates and higher occupancy through both good asset management and the extensive capex programme which is focused on approximately 50% of the current vacant space. Demand for both our conventional space and our flexible workspace solutions remains strong and we are pleased with progress already being made on the new properties acquired this year.

Whilst we remain on target to reduce the Group’s loan-to-value ratio to at least 40% in the near term, our ability to access debt at very low cost will also have a significant impact on our returns to shareholders and accordingly we are focused on improving the terms of the Group’s debt financing packages. Sirius Real Estate, which was added to the AIM FTSE 100 index in February 2015, expects the financial year ended 31 March 2015 results due for release end of May to be in line with market expectations. 

 

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