Sirius Real Estate Regulatory News (SRE)

Sirius Real Estate Limited

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

Completed acquisition of two properties for €48.9 million in Germany

Sirius Real Estate is pleased to confirm that it has completed the acquisition of two multi-let business parks located in Mahlsdorf and Potsdam, for a total consideration of €48.9 million, inclusive of acquisition costs. The properties have been acquired from Union Investment and represent two of the five sites referred to in our announcement on 28th November 2014.

Located on the outskirts of Berlin, the two business parks have a total lettable area of 67,774 sqm and will mean that the Company now has five business parks in the Berlin area, a core market for the Company where demand for flexible workspace solutions is high.

Based on the current occupancy of 86%, the two sites generate €4.1 million of annualised rental income and €3.8 million of net operating income at an EPRA Net Initial Yield of 7.7%* and an initial cash on cash return of 13.3%. When fully mature, the two sites are expected to produce a rent roll in excess of €4.5 million per annum. The existing tenant base of 74 tenants provides good security with a weighted average lease length remaining of 3.94 years and the Company will now progress its plans to invest in the vacant space to create a mixture of conventional office and industrial space as well as its flexible workspace solutions.

*Calculated as rental income less non recoverable service charge costs and landlord maintenance, over purchase price plus acquisition costs 

The acquisitions were funded by a drawdown of €26.1 million from its new €36 million, 5-year debt facility from one of the Company's existing bankers. The monies drawn down have ‎a 2.85% annual fixed interest charge per annum and amortisation of 2.00%. The balance of the total consideration will come from the proceeds of the Company's recent €40 million Private Placement also announced on 28 November 2014. The remainder of the €36 million bank facility will be drawn down against further acquisitions, as previously announced, which are expected to complete in January 2015.

Andrew Coombs, Chief Executive of Sirius, commented: "We are pleased to have completed the acquisition of the two properties which are in key locations on the outskirts of Berlin; a region in which we have a strong track record of creating value-added tenancy space, and where we plan to continue to increase our presence.

The EPRA Net Initial Yield of 7.7% is attractive and enables us to take advantage of our ability to borrow money at below 3%. This yield gap together with our asset management plans for the two sites makes us confident we can generate good returns for shareholders."

Enquiries:

Sirius Real Estate

Andrew Coombs, CEO +49 (0)30 285010110

Alistair Marks, CFO

Peel Hunt

Capel Irwin +44 (0)20 7418 8900

Hugh Preston

Finncap

Stuart Andrews +44 (0)20 7220 0500

Paul Harrington

PSG Capital

David Tosi +27 (0)21 887 9602

Willie Honeyball

Novella

Tim Robertson +44 (0)20 3151 7008

Ben Heath