CLS has unconditionally exchanged contracts to acquire two office properties in Berlin, Germany, and Watford, United Kingdom, for a combined total of €61.3m (£55.9m) excluding costs.
The first property, Kaiserin-Augusta-Allee 112 & 113 (Goldstuck), is a six-storey office composed of two adjoined buildings located in North-West Berlin (Charlottenburg), adjacent to the River Spree. Goldstuck was acquired from Deutsche Investment KVG for €43.5m. The property is well-situated, being close to several bus stations which provide direct access to central and western Berlin. Its central location also allows many existing occupiers to walk or cycle to the office. Goldstuck comprises 8,712m² and benefits from 93 car parking spaces.
The building is currently 29% let following the recent departure of the previous anchor tenant. The remaining accommodation provides a WAULT of 1.9 years and €545,000 of current contracted rent. The current occupancy and low passing rent provide an opportunity to refurbish comprehensively and reposition the existing asset, re-let and capture market rents in the low vacancy Berlin market as well as strengthening its sustainability rating in line with Group targets. The building has an estimated reversionary yield of 5.6% once fully let.
The second property, Radius House, is located on Clarendon Road in Watford and was acquired from M&G Real Estate for €18.5m (£16.9m). The property comprises 3,830m² and is a short walk from Watford town centre and Watford Junction overground station, providing direct access to London Euston station in 16 minutes.
The building is fully let to four tenants with a WAULT of 8.1 years. The current contracted rent of €1.14m reflects a net initial yield of 5.6%. 51% of the current income is contracted to The Secretary of State for Housing, Communities and Local Government until 2030 without break, offering secure long-term income. Both acquisitions will complete in early 2021.
Fredrik Widlund, Chief Executive Officer of CLS, commented: “These acquisitions provide a combination of long-term, secure income and an opportunity to capture significant reversion through our active asset management approach. This demonstrates CLS’ broad capabilities and ability to source excellent deals in our key markets. CLS has remained disciplined in its approach to acquisitions but has found a few high-quality opportunities which complement the existing portfolio. Combined with our earlier acquisitions in Germany and the UK, CLS has acquired nearly €186.4m (£170m) of assets so far this financial year, significantly enhancing our portfolio.”
