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Sirius Real Estate's organic growth driven by strong tenant demand
Business parks operator Sirius Real Estate saw strong tenant demand, combined with specific asset management initiatives, generate an "encouraging increase" in organic rental growth over its most recent trading year.
Sirius told investors on Monday that it expects its results for the year ended 31 March to be in line with market expectations, something it highlighted as a "particularly good performance" given the disposal of approximately 103m of mature assets throughout the year.
Total annualised rent income, including acquisitions, increased 6.76% to 75.8m, in spite of losing 7.1m of annualised rental income from disposed assets, and the company highlighted that annualised rental income had continued to improve in the post-period, growing to in excess of 79.0m.
Sirius' like-for-like annualised rental income increased in excess of 5%, supported by continued occupier demand and organic rental income growth driven by the company's internal operating platform.
Proceeds from the sale of 103m of mature assets and two capital raises, 15m in March 2017 and 25m in July 2017, helped to fund the acquisition of 163.7m worth of new assets with an average occupancy of 58%, providing Sirius with new rental income and capital growth opportunities.
Andrew Coomb, Sirius' chief executive officer, said, "Given a key focus in the period was on recycling capital from mature assets into new opportunities with greater value-add potential, it is particularly pleasing to have sold and reinvested over 250m of property whilst also delivering increases in rental income on a total and like-for-like basis."
Elsewhere, Sirius had its "buy" rating reissued by investment analysts at Peel Hunt on Monday.
As of 1220 BST, shares had dropped 0.34% to 59.40 each.