Sirius Real Estate Regulatory News (SRE)

3 June 2019

Sirius Real Estate Limited

("Sirius Real Estate", "Sirius" or the "Company")

Sirius completes acquisition of business park in Teningen

Sirius Real Estate, the leading operator of branded business parks providing conventional space and flexible workspace in Germany, has completed the acquisition of a business park in Teningen, north of Freiburg, for €6.5 million, including acquisition costs, reflecting an EPRA net initial yield of 8.3%. The vendor is the Ascom Group, a Swiss healthcare solution provider. Notarised on 22 March 2019, the acquisition has been funded from existing cash resources.

The business park is well located in the economically strong metropolitan region of Freiburg, which is located in the Federal State of Baden Württemberg in the South West of Germany and in the vicinity of Strasbourg (France) and Basel (Switzerland), with easy access to the A5 Hamburg - Basel motorway and the national rail network.

The property provides lettable area of 20,000 sqm (40% warehouse/production space; 38% offices; 19% laboratory; and, 3% of other space) on a 43,000 sqm site. It is currently leased to seven tenants, with occupancy at 88% and producing annual net operating income of €542,000. The weighted average lease expiry is 1.6 years.

Tenants include Delta Energy Systems, a subsidiary of the international Delta Group, which provides innovative, environmentally friendly and efficient energy solutions; the headquarters of FRAKO which operates internationally in power factor correction, power quality and energy management; and Conworx, a subsidiary of Siemens, which provides technical services in medical technology and laboratory diagnostics.

Andrew Coombs, Chief Executive Officer of Sirius Real Estate, said: "This is our first investment in the area around Freiburg which, while not within our primary target of Germany's seven key cities, has some very attractive characteristics particularly given its location close to the French and Swiss borders.

"The asset has significant asset management potential, playing to the strengths of our integrated business model and track record of achieving both efficiencies and maximising occupation. There is also the potential to develop around 2,000 sqm of additional space from surplus land".

For further information:

Sirius Real Estate

Andrew Coombs, CEO

Alistair Marks, CFO

+49 (0)30 285010110

Tavistock (financial PR)

Jeremy Carey

James Verstringhe

+44 (0)20 7920 3150

siriusrealestate@tavistock.co.uk

NOTES TO EDITORS

About Sirius Real Estate

Sirius is a property company listed on the main market and premium segment of the London Stock Exchange and the main board of the Johannesburg Stock Exchange. It is a leading operator of branded business parks providing conventional space and flexible workspace in Germany. The Company's core strategy is the acquisition of business parks at attractive yields, the integration of these business parks into its network of sites under the Company's own name as well as offering a range of branded products within those sites, and the reconfiguration and upgrade of existing and vacant space to appeal to the local market, through intensive asset management and investment. The Company's strategy aims to deliver attractive returns for shareholders by increasing rental income and improving cost recoveries and capital values, as well as by enhancing those returns through financing its assets on favourable terms. Once sites are mature and net income and values have been optimised, the Company may take the opportunity to refinance the sites to release capital for investment in new sites or consider the disposal of sites in order to recycle equity into assets which present greater opportunity for the asset management skills of the Company's team.

On 1 March 2019, Sirius announced that, in a transaction anticipated to complete in June 2019, it had formed a real estate investment joint venture with clients represented by AXA Investment Managers - Real Assets in which AXA acting on behalf of its clients, will own a 65% interest and Sirius will own the balance of 35%. The JV is called Titanium. The JV will initially be formed by AXA acquiring, on behalf of its clients, from Sirius a 65% stake in five SPVs through which it currently owns two business parks located in Berlin (Berlin Borsig and Berlin Tempelhof) and one in each of Mainz, Nurnberg and Bayreuth. The business parks provide a combination of office, warehouse, industrial and storage space. The implied property value of €168 million equates to a gross yield for the portfolio of6.2% and reflects a premium to the last reported book value as at 30 September 2018 which was €141.1 million. Total cash commitment from AXA IM - Real Assets amounts to €43.9 million. The transaction is expected to generate total cash proceeds of more than €70 million for Sirius after refinancing and expected related costs. 

For more information, please visit: www.sirius-real-estate.com

Follow us on LinkedIn at https://www.linkedin.com/company/siriusrealestate/

Follow us on Twitter at @SiriusRE

LEI: 213800NURUF5W8QSK566

JSE Sponsor

PSG Capital