18 March 2022
Eleventh investment in Germany for Tritax EuroBox
ACQUISITION OF PRIME LOGISTICS ASSET IN THE DUSSELDORF LOGISTICS REGION OF GERMANY FOR €76.4 MILLION
Tritax EuroBox plc (“Tritax EuroBox” or the “Company”) (ticker: EBOX (Sterling) and BOXE (Euro)), which invests in high-quality, prime logistics real estate strategically located across continental Europe, announces that it has entered into a conditional agreement with a subsidiary of Dietz AG (the “Dietz Seller”) for the speculative forward funding acquisition of a €76.4 1 million logistics asset in the Düsseldorf region of Germany (the ” Dormagen Proposal ” ).
The asset, currently being constructed by the Company's development partner Dietz Aktiengesellschaft (“Dietz AG”), is held freehold and once built will comprise three adjacent units with a total gross internal area of approximately 36,437 square metres. The three units offer flexible leasing options either to be let to multiple tenants or a single tenant.
The asset benefits from an eighteen-month rental guarantee from the Dietz Seller at a rent reflecting €5.60 per square metre per month for warehouse space. The acquisition price of €76.4 million reflects a net initial yield of 3.3% based on the rental guarantee income. Market rental levels in this location are expected to exceed €6.00 per square metre per month for warehouse space.
Dormagen, located between Cologne and Düsseldorf, is considered one of the principal logistics areas in Germany and is characterised by a scarcity of available development land and available buildings coupled with strong occupier demand. Dormagen is a highly sought-after location, well connected to the A1, A46 and A57 motorways.
The Dormagen Proposal presents a further opportunity to meet several of the Company's sustainability objectives via the redevelopment of a brownfield site targeting a DGNB Gold Certificate in use sustainability standard.
This acquisition forms part of the continued deployment strategy for Tritax EuroBox following its successful equity raise in September 2021.
Completion of the acquisition is subject to, among other things, shareholder approval as Dietz AG is considered a related party to the Company under the Listing Rules. A circular containing further information about the Dormagen Proposal and a notice convening a General Meeting of the Company at which shareholders will be asked to vote in favour of a resolution to approve the Dormagen Proposal will be posted to shareholders as soon as practicable.
Further details of the Dormagen Proposal, including the key commercial terms, are set out in the appendix to this announcement.
Alina Iorgulescu, Assistant Fund Manager of Tritax EuroBox, commented:
“We are delighted to be acquiring this asset, which is the eleventh German investment for Tritax EuroBox, bringing our total amount invested in the country to over €800 million. This off-market acquisition gives us the ability to control the desired leasing profile of the scheme through capturing the rental growth evident in the market, and also allowing the Company to introduce open market rent reviews into the lease, providing a mechanism to capture the expected future rental growth driven by the continued favourable imbalance in supply and demand in the German logistics market.
We remain focused on exercising strict discipline in investing in these prime logistics locations in Germany. The powerful structural trends continue to drive occupier demand in these prime logistics locations in the Rhine-Ruhr region of Germany, providing us with long term embedded value in the assets we acquire.”