Branded business park specialist Sirius Real Estate has notarised the disposal of an industrial park in Maintal, in Germany’s southwest Hesse region, for €40.1 mln, representing a net initial yield of 5.7%.
The disposal was achieved at approximately 6% above the last reported book value. The Maintal industrial park offered Sirius little potential for further value creation, however its strategic location made it attractive to the purchaser, a trend we have witnessed in past disposals of mature assets.
Furthermore, through its BizSpace subsidiary, Sirius has exchanged and completed on the acquisition of a £33.5 mln (€38.6 mln) portfolio of three assets located in North London, from a closed ended fund.
The assets are based in busy suburban areas, with two in the Borough of Islington and one in the Borough of Camden. The three assets have a combined area of 103,962 ft2 (9,658 m2) of primarily multi-let studio workspaces and occupancy rate of just under 70%, which the group views as providing significant potential for growth.
The properties are let on flexible leases and have a weighted unexpired lease term of 3.1 years. The buildings have over 70 customers, the 10 largest of whom occupy over 50% of the occupied area. The purchase price represents a NIY of 7.3% which through active asset management initiatives should generate a running yield in excess of 10% at maturity, Sirius said.
Andrew Coombs, CEO of Sirius Real Estate, commented: 'The Maintal disposal at a premium to book value has allowed us to capitalise on demand for this high quality property.
'The sale of this mature asset at a 5.7% NIY, coupled with the completion of our acquisition of the properties in London at a 7.3% NIY with only a 70% occupancy, represents a good example of our strategy of recycling capital from mature assets into those where we believe we can grow income and value through our operating platform.
'In the current market we are focused on improving rental levels and providing tenants with the flexibility and services they need. We are increasingly seeing attractive acquisition opportunities across both Germany and the UK and will continue to pursue our asset recycling activities to support the long term growth of the Group.'
