Sirius Real Estate Regulatory News (SRE)

17 December 2019

Sirius Real Estate Limited

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

Sirius completes €44.5 million acquisition of business park near Frankfurt am Main

Sirius Real Estate, the leading operator of branded business parks providing conventional space and flexible workspace in Germany, announces that, further to its notarisation announcement on 26 July 2019, it has completed the acquisition of Alzenau Business Park, 34km east of Frankfurt am Main. The total purchase consideration of €44.5 million, including acquisition costs of €2.5 million, was acquired on an EPRA net initial yield of 7.9%. The acquisition will initially be funded using proceeds from recent asset recycling activity and will be injected into an existing facility in the near future.

The vendors are RWE Generation SE and GfV Gesellschaft für Vermögensverwaltung mbH represented by Innogy SE.

The business park comprises eleven buildings constructed between 1985 and 2002 providing a total of around 60,000 sqm of lettable space (47% warehouse/production space; 47% office space; and 6% other space) as well as 1,063 parking spaces on a total plot size of approximately 197,000 sqm.

The asset is 93.5% let to 16 tenants with an annual total income of €4.1 million and annual net operating income of €3.5 million as at July 2019.

The asset has a weighted average rent of €5.51 per sqm with a remaining WALT of 3.5 years. Tenants include Applied Materials, the global leader in materials engineering solutions for the semiconductor, flat panel display and solar photovoltaic industries; Bühler Alzenau GmbH, manufacturers of high-vacuum deposition equipment; and Nukem Technologies GmbH, operating in the management of radioactive and hazardous waste, decommissioning of nuclear facilities as well as engineering and consulting services. There is also an 8,200 sqm plot of land let to Aldi until 2048 producing an annual income of €101,000. Overall, the asset provides the Company with stable income from a well-diversified and covenanted tenant base.

Commenting on the acquisition, Andrew Coombs, Chief Executive Officer of Sirius Real Estate, said: "Alzenau Business Park is the largest single acquisition since the current management took over at Sirius, reflecting our capacity to acquire larger lot sizes, of which we expect to do more both for our own portfolio and through our Titanium joint venture with AXA.

"This asset provides an attractive running yield, which will support our strategy to grow our funds from operations. Furthermore, there is a good mix of long-standing tenants with strong covenants."

For further information:

Sirius Real Estate

Andrew Coombs, CEO/Alistair Marks, CFO

Tel: +49 (0)30 285010110

Tavistock (Financial PR)

Jeremy Carey/James Verstringhe

Tel: +44 (0)20 7920 3150

Email: 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.

In July 2019, the Company completed the formation of its Titanium real estate investment joint venture with clients represented by AXA Investment Managers - Real Assets. Titanium was formed through the acquisition by AXA IM - Real Assets, on behalf of its clients, from Sirius, of a 65% stake in five business parks across Germany. Sirius will retain the remaining 35% and will act as operator of the assets, on a fee basis. Subject to suitable investment opportunities, AXA IM - Real Assets and Sirius may consider opportunities to grow the JV's portfolio primarily through the acquisition of larger stabilised business park assets and portfolios of assets with strong tenant profiles and occupancy. Sirius will continue to grow its wholly owned portfolio through acquisitions of more opportunistic assets, where it can capitalise on its asset management expertise to maximise utilisation of the space, grow occupancy and improve quality of the tenants. The strategies have been clearly defined so that the JV does not conflict with Sirius's existing business.

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

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