Sirius Real Estate, the owner and operator of business parks in Germany, has acquired an asset in Essen for €10.7m
The transaction is by way of a sale and leaseback with thyssenkrupp, the international industrial engineering and technology group, and reflects an EPRA net initial yield of 6.5%. The purchase was sourced by the Sirius acquisitions team off-market and will be funded from existing cash resources, with completion expected in Q2 2021.
Built between 1962 and 1963, the mixed-use business and industrial park offers 14,711 sqm of gross lettable area, of which 45% is warehouse, 42% is office and 13% production space. The park includes a 4,450 sqm parcel of land that offers the potential for development into additional warehouse and office space.
The business park is currently 80% let to six entities within thyssenkrupp, and produces total annualised rental income of around €830,000, reflecting an average rent of €5.85 per sqm.
The weighted average unexpired lease length is 1.4 years, which Sirius said presents it with a range of asset management options and the opportunity to increase income through the re-letting of vacated space and selective investment into the asset.
Andrew Coombs, chief executive, said: “The business park we are acquiring at Essen offers a good mix of warehouse and office space, as well as great potential for Sirius to use our asset management capability and local expertise to add value, improve rental tone and explore development of part of the site. Essen is a city we know well and one we believe has strong long-term growth prospects.
“We were able to proactively secure this high-yielding asset on an off-market basis from thyssenkrupp directly, demonstrating the power of our local knowledge and network, and we see further opportunities to acquire assets from Germany’s manufacturing and industrial firms looking to free up capital. This presents a positive opportunity to strengthen our pipeline and source the most attractive deals.”
SRE : Sirius Real Estate buys €10.7m business park