Sirius Real Estate has completed the acquisitions of Neuss II, a business park near Dusseldorf, and Neuruppin Business Park, in the Brandenburg region, for a combined total of €33.4m, reflecting an aggregate EPRA net initial yield of 6.8%.
Originally constructed in 1987 and since expanded, Neuss ll provides a total of 34,000m² of net lettable space (21,900m² of warehouse/production, 11,700m² of office and 400m² of other space), together with 371 parking spaces, on a total plot size of 58,800m². The property is located on Fuggerstrasse in Neuss, 9.5 km south of Dusseldorf city centre. Sirius already owns an 18,000m² office building in Neuss and two other business parks in Dusseldorf.
The asset is 81.5% let to sixteen tenants, producing an annual rental income of €1.3m, reflecting an average rate of €3.84 per m², and has a remaining WALT of 4.4 years. Tenants include Max Mothes, Steep GmbH, DINAX GmbH and FEAG GmbH. The property has been acquired from a regional family real estate office for €19.1m (including acquisition costs), reflecting an EPRA net initial yield of 5.4%.
Originally constructed in 1992 and since expanded, Neuruppin Business Park, provides 22,400m² of net lettable space (12,600m² of production space, 7,200m² of warehouse space and 2,600 sqm of offices), together with 169 parking spaces on a total plot size of 108,200m². The property is located 4.3 km south of Neuruppin city centre, 75 km north-west of Berlin. Neuruppin is likely to benefit from a €1.4bn road infrastructure expansion project on the main highway between Berlin and Hamburg, anticipated to complete in 2022.
The asset is 100% let to a single tenant, ESE GmbH, Europe's leading manufacturer of temporary storage systems for waste and recyclables, on a lease with 5.5 years to run, at a current annual rent of €1.3m, reflecting a rate € 4.97 per m². The property has been acquired from Otto Immobilien GmbH & Co. KG for €14.3m (including acquisition costs), reflecting an EPRA net initial yield of 8.6%.
Commenting on these acquisitions, Andrew Coombs, Chief Executive Officer of Sirius Real Estate, said: "The last month has been particularly successful on the acquisitions front providing us with some great assets which have good value add potential that can be realised next year and beyond. Neuss ll fits well with our strategy of buying assets at low capital values, with low average rents compared to the local market and located around key German cities. It offers us a good opportunity to add significant value by playing to the strengths of our integrated business model and track record of maximising occupation and growing rental levels. The Neuruppin property, which is 100% let to a tenant with a strong covenant with a WALE of 5.5 years and an EPRA net initial yield of 8.6%, is a very good acquisition, particularly when you take into account the tenant's potential plans to expand in the area as well as the further opportunity to develop vacant parcels of land within the site."
