Sirius Real Estate, which operates business parks across Germany, has completed the acquisition of Alzenau Business Park, 34km east of Frankfurt am Main, for €44.5m.
The business park comprises eleven buildings constructed between 1985 and 2002 providing a total of around 60,000 sqm of lettable space and was bought ar a net initial yield of 7.9%.
The asset, which is split 47% warehouse/production space, 47% office space and 6% other space, is 93.5% let to 16 tenants with an annual total income of €4.1m and annual net operating income of €3.5m as at July 2019.
The asset has a weighted average rent of €5.51 per sqm with a remaining average lease length of 3.5 years. Tenants include Applied Materials, the global leader in materials engineering solutions for the semiconductor, flat panel display and solar photovoltaic industries; Bühler Alzenau, manufacturers of high-vacuum deposition equipment; and Nukem Technologies, operating in the management of radioactive and hazardous waste, decommissioning of nuclear facilities as well as engineering and consulting services.
There is also an 8,200 sqm plot of land let to Aldi until 2048 producing an annual income of €101,000.
The company said the acquisition will initially be funded using proceeds from recent asset recycling activity and will be injected into an existing facility in the near future.
Andrew Coombs, chief executive of Sirius Real Estate, said: “Alzenau Business Park is the largest single acquisition since the current management took over at Sirius, reflecting our capacity to acquire larger lot sizes, of which we expect to do more both for our own portfolio and through our Titanium joint venture with AXA.
“This asset provides an attractive running yield, which will support our strategy to grow our funds from operations. Furthermore, there is a good mix of long-standing tenants with strong covenants.”
SRE : Sirius Real Estate acquires German business park for €44.5m