Sirius Real Estate reports 12.8% rent roll growth for 2025

Sirius Real Estate, leading owner and operator of branded business and industrial parks in the UK and Germany, has reported a 12.8% increase in rent roll for the year to March 31, 225.

This increase was driven by strong organic growth, ongoing asset acquisitions, and robust demand for space at its business parks, a trading statement released Monday showed.

The share price fell 3.05% to R20.05 on the JSE Monday morning, still well up from R17.10 three months ago, but below the R22.72 of a year ago.

"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,” said CEO Andrew Coombs.

On a like-for-like basis, rent roll accelerated since the first half, leading to a total annual increase of 6.3%, marking the eleventh consecutive year of rent roll growth in excess of 5%, he said in a statement.

Similar levels of growth were achieved in both Germany and the UK. Full-year results in line with market guidance were anticipated when the results are released on June 2, 2025.

The group also expected to announce a positive valuation movement at the period end. In Germany, rent roll benefitted from stronger rates, despite routine move-outs at the beginning of the year which held back occupancy in the first half.

Coombs said the second half saw particularly strong growth in occupancy as the strategy began to bear fruit. The in-house asset management platform was pivotal in balancing increases in rates while maintaining a healthy occupancy mix, which allows for further growth within the 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,” said Coombs.

In the UK, similar to Germany, like-for-like rates increased strongly, and a particularly strong finish to the year had seen 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 acquisition, “and we expect to see valuations in the UK stabilise, in contrast to recent periods. We believe the improving transactional market will build further confidence,” he said.

The group continues to acquire assets offering day-one income and value creation potential in the UK and Germany, and the recently announced acquisitions in Chalcroft (Southampton) and Monchengladbach were expected to complete early in the first quarter of the new financial year.

In the past year, 11 acquisitions were announced, with an investment of more than £250 million.

“The acquisition pipeline remains strong, and the combination of cash and balance sheet headroom will allow us to execute on these opportunities to drive earnings growth in the year ahead,” he said.

The company raised a £350m, seven-year corporate bond in January 2025, at a coupon rate of 4.0%. In addition, it raised debt in Germany at an interest cost of 3.26% with the refinancing of its Saarbrucken asset in February 2025, for a five-year term, and hopes to take advantage of similar financing opportunities going forward.

“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 some heightened macro uncertainty at the moment, we feel our assets will continue to prove their resilience and attractiveness to occupiers,” said Coombs.

He said they were well placed to benefit from the positive impact of the recently announced German defence and infrastructure spending plans, which were widely expected to provide a clear catalyst for economic growth in Germany with a read across to the UK.

Business Report