In line with its strategy announced in November 2005 to establish a portfolio in Germany, CLS Holdings plc (CLS) is delighted to announce three further acquisitions in Germany for a total consideration of €78.2 mln.
Firstly, CLS has purchased a new property in Hamburg, known as Jarrestrasse 8-10. The building was constructed in 2003 and comprises 5,654 m² of offices and storage together with car parking. The property is 100% let to 9 different tenants on leases ranging from one to six years, generating an annual rent of €932,606.
The initial yield is 7.5%. The initial return and cash return on equity with the completed loan facility of €10.4 million is 23.2%.
Secondly, CLS has agreed to purchase Adlershofer Tor, a 19,715 m² retail and office building in Adlershof Business and Science Park in south Berlin. The average lease length is over 13 years with 45% of the building let to Kaufland, the German retailer, with 17 years unexpired. The property will generate an initial rental income of €2,796,344 and an initial yield of 7.5% upon its expected completion in April 2006. The initial anticipated return on equity is 20% and the cash return on equity is anticipated at 14%.
Thirdly, CLS has contracted to purchase the New Head Office of BrainLAB in Feldkirchen, Munich, let on a 10 year term with an initial rent of €2,004,091. The building will comprise 19,466 m² of office, storage, exhibition space and parking and is expected to be completed by mid-2006. The initial yield is 7.0%. The initial anticipated return on equity is 20% and the cash return on equity is anticipated at 15%.
Christian Holle of Immobilien Asset Management GmbH has acted as consultant for CLS on these transactions.
Upon completion of these purchases, CLS property portfolio in Germany will comprise five properties located in Hamburg, Munich, Berlin and Dusseldorf with a total value of €84.2 million. Furthermore, CLS intends to continue its expansion in Germany in view of the continuing attractive returns.
Executive Chairman, Sten Mortstedt, commented:
We are delighted to have been able to acquire these properties either newly constructed or in the course of construction with the benefit of good financial returns. We have now built up a sizeable portfolio in Germany and as we are continuing to see quality buildings offered in the market, further acquisitions are anticipated in the near future.
Source: CLS Holdings