Johannesburg - Sirius Real Estate, which operates branded
business parks providing conventional space and flexible workspace in Germany, is
selling its Rupert Mayer street business park in Munich for €85 million (R1.2 billion)
and has agreed to lease back and manage the asset for 6 years.
In a statement issued on Friday, Sirius says it continually
reviews its portfolio “with a view to disposing of mature and non-core assets
and recycling equity into assets with higher opportunities, in order to
increase total returns from the portfolio”.
It adds: “Over the 8 years since the Rupert Mayer Str.
site was acquired, Sirius’s asset management activity has increased net
operating income from €4.4 million to €5.3 million with the value of the asset
increasing by 48 percent from the €57.5 million it cost to acquire.”
Sirius notes the asset was purchased from Siemens who
occupied almost 100 percent of the site when acquired and subsequently completely
vacated the business park.
“The Sirius asset management team has successfully filled
the site with a mixture of conventional and flexible workspace leases and it is
now 88 percent occupied.”
Read also: Sirius plans to dispose of mature assets
The sale price of €85 million represents a 9 percent
premium to Sirius’s book value of €78.1 million as at September 30, it
explains.
The site is being sold to Fiduciary Capital, which is
based in Munich.
There is a secured loan of around €42 million outstanding
on the asset for which Sirius has the option of repaying with a small penalty
fee or substituting the Munich asset with other assets into the facility, it
adds.
“The leaseback enables Sirius to retain the difference
between the rent it pays and the income from the site in addition to an annual
management fee of €100 000 per year for the term of the lease.”
Completion is expected to be in April 2017.
BUSINESS REPORT