April 8 2025 10:54
GERMANY
Sirius Real Estate, the JSE-listed landlord with assets in Germany and the UK achieved a 6.3% increase in its group level like-for-like rent roll in the year to end-March 2025.
Sirius which listed a decade ago in SA, owns and operates business and industrial parks providing conventional space and flexible workspace in Germany and the UK on Tuesday, provided an update on trading for its 2025 financial year.
The group achieved a 12.8%* year-on-year increase in rent roll, “driven by a combination of strong organic growth and the ongoing successful asset acquisition programme, coupled with continued strong demand for space at our business parks” it said. On a like-for-like basis, rent roll accelerated since the first half, leading to a total annual increase of 6.3%, compared with the year to end-March 2024, marking the eleventh consecutive year of rent roll growth in excess of 5%. Similar levels of growth have been achieved across both Germany and the UK.
“The group accordingly expects to deliver full year results in line with market expectations,” it said.
Siirus expected to announce a positive valuation movement at group level at the period end. In Germany, rent roll benefitted from stronger rates, regardless of anticipated routine move-outs at the beginning of the year which held back occupancy in the first half.
“It is pleasing to report that the second half saw particularly strong growth in occupancy as the Company’s strategy began to bear fruit. The company’s in-house asset management platform was again pivotal in balancing increases in rates whilst maintaining a healthy occupancy mix which permits further growth from our portfolio. We expect to see the growth in income translate into a meaningful increase in our portfolio valuation in Germany against a backdrop of stable yields as the transactional market continues to improve,” Sirius said.
In the U.K, similar to Germany, like-for-like rates grew strongly and a particularly strong finish to the year saw occupancy increases, driving like-for-like rent roll growth well ahead of that reported in the first half. Total rent roll growth in the UK was underpinned by material acquisitions in the period and Sirius expected to see valuations in the UK stabilise, in contrast to recent reporting periods.
“We believe the improving transactional market will build confidence,” said Sirius’ CEO Andrew Coombs.
Siirus would acquire attractive assets offering both day one income and value creation potential in the UK and Germany and looked forward to completing recently announced acquisitions in Chalcroft in Southampton, and Mönchengladbach early in the first quarter of the new financial year.
“In the past year we have notarised and/or completed on 11 acquisitions, with an aggregate investment of more than €250m. The acquisition pipeline remains strong, and the combination of cash and balance sheet headroom will allow the group to execute on these opportunities to continue to drive earnings growth in the year ahead,” said Coombs.
Sirius achieved a €350m, seven year corporate bond raise in January 2025, at a coupon rate of 4.0%. In addition, the company raised debt in Germany at an interest cost of 3.26% with the refinancing of its Saarbrücken asset in February 2025, for a five year term, and “hopes to take advantage of similar financing opportunities going forward” it said.
“Over the course of 2024 our focus on growth, asset management and demonstrating the value Sirius’ platform can bring to our occupiers allowed us to deliver a strong performance, with momentum building strongly as we finished the year. This has translated into our eleventh year of above 5% like-for-like rental growth, as well as improving occupancy and an expected overall valuation increase,” said Coombs.
Sirius invested around €250m into eleven acquisitions, which will be both accretive to its rent roll and also offer the opportunity for future value creation.
“We have a strong balance sheet and have demonstrated our ability to raise debt at attractive levels, which will allow us to execute our healthy pipeline of further investment opportunities. While there is undoubtedly some heightened macro uncertainty at the moment, we feel that our assets will continue to prove their resilience and attractiveness to occupiers. We believe the Group is well placed to benefit from the positive impact of the recently announced German defence and infrastructure spending plans, which are widely expected to provide a clear catalyst for economic growth in Germany with a read across to the UK,” said Coombs.
Sirius will announce results for the financial year ended 31 March 2025 on Monday, 2 June 2025,
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