Sirius Real Estate Limited (LON:SRE) announced it completed the acquisition of a mixed-use business park in Fellbach, near Stuttgart, for EUR9.2mln.
The owner and operator of branded business and industrial parks in Germany said the space covers 8,800 square metres with 200 parking spaces and reflects an EPRA net initial yield of 6.0%.
This investment follows the acquisition of a business park located in Fellbach where occupancy has increased to 90% from 79% when the deal was announced in August 2018.
The company added that the new asset sits immediately adjacent to its existing site, creating an enlarged business park comprising over 36,000 square metres of gross lettable area.
The FTSE 250 group said it acquired the business park from a local family office using existing cash resources.
It is currently 94.6% let to Mercedes-Benz manufacturer Daimler as the single tenant, at an average rent of EUR7.04 per square metre, producing a total annualised rental income of EUR730,000.
When Daimler vacates the offices in June and the warehouses in December, Sirius plans to implement a range of asset management initiatives including the upgrade of space.
“This high-quality asset deepens our exposure to a commercial market in which we already have extensive experience. The acquisition will provide a number of compelling operational synergies and widens our range of asset management options particularly when considered alongside our existing adjacent Fellbach business park,” said chief executive Andrew Coombs in a release.
“With the major tenant moving out shortly after completion our focus is on growing income through the capture of reversion and reduction in service charge leakage. We continue to benefit from a strong balance sheet allowing us to maintain our strategy of acquisitive growth in and around Germany’s key cities.”