IREIT Global Group, manager of IREIT Global, has entered into a sale and purchase agreement with HFS Immobilienfonds Deutschland 6 GmbH & Co KG to acquire a property in Berlin for 144.2 million euros (S$217.7 million).
Located in the district of Lichtenberg, the property comprises two fully connected building sections of eight storeys and 13 storeys respectively.
Choo Boon Poh, chief financial officer of IREIT, said: "We intend to fund the acquisition through a mix of equity and debt. IREIT has announced a rights issue to raise gross proceeds of approximately S$88.7 million. The balance of the funding for the acquisition will be through a bank loan facility, from which it intends to draw down a gross amount of approximately 102 million euros."
The net property income yield is 7.1 per cent. Principal tenant Deutsche Rentenversicherung Bund (DRB) occupies 98.8 per cent of the property's total lettable area on a lease expiring in 2024.
With this acquisition, IREIT's total portfolio value will grow to 438 million euros. The property will be its largest asset, adding a net lettable area of 79,097 sq m to IREIT's existing portfolio for a total of 200,603 sq m with 3,441 parking spaces.
"IREIT was attracted to the Berlin property due to the strong principal tenant, DRB - a federal pension fund and the largest of the 16 federal pension institutions in Germany - and the opportunity for rental and value growth in this increasingly popular location," it said. Post-acquisition, IREIT is poised to leverage on the robust office and investment market in Berlin.