Sirius Real Estate Limited · LSE:SRE
Sirius Real Estate — Dawnay, Day Sirius — IPO Roadshow (April 2007)
25 slides from Sirius Real Estate's IPO roadshow presentation, April 2007
Slide 1: Dawnay, Day Sirius Limited
Dawnay, Day Sirius Limited April 2007
Slide 2: Disclaimer
z Disclaimer IMPORTANT NOTICE z This document, which is personal to the recipient and has been prepared by Sirius Facilities GmbH, Dawnay, Day International Ltd and Dawnay, Day Sirius Asset Management Limited (the "Principals") on behalf of Dawnay, Day Sirius Limited ("DDS"), comprises written mater
Slide 3: Offer Summary
Offer Summary Offer size ¾ Up to €300 million * Free float ¾ Approximately 90% Asset Manager ¾ Dawnay, Day Sirius Real Estate Asset Management Limited ¾ Institutional offering in the UK Offer structure ¾ Private placement outside the UK to institutional investors, including the USA pursuant to Rule
Slide 4: Timetable
Timetable Event Date • Pathfinder admission document published • 17 April • Roadshow & book building • 17 – 30 April • Offer closes and pricing • 30 April • Conditional dealings commence • 1 May • Admission • 4 May 4 Dawnay, Day Sirius Limited Providing space for business
Slide 5: Presentation Team
Presentation Team Kevin Oppenheim, 34 • Chief Executive Officer of Dawnay, Day Sirius Real Estate Asset Management • Co-founder of Saturn Facilities in the UK and Sirius Facilities in Germany • Over 12 years real estate experience, including eight years with Saturn Ingo Spangenberg, 40 • Managing Di
Slide 6: What is Dawnay, Day Sirius?
What is Dawnay, Day Sirius? • Real estate company providing and operating flexible workspace in Germany • Acquiring and transforming existing office and industrial property and converting it into flexible workspace, predominantly for SMEs • Initial portfolio value of €206m*; 20 properties; net renta
Slide 7: Sirius Business Model
Sirius Business Model • Acquires large under-utilised and under-occupied office/industrial properties (typically 10,000 – 100,000m2) for conversion into flexible workspace in well established business locations targeted specifically at tenants in the SME sector • Limited competition for this specifi
Slide 8: UK Track Record
UK Track Record • Saturn Facilities (the UK brand) was started in 1999 as a joint venture between Dawnay, Day and Frank & Kevin Oppenheim • The objective was to acquire large mixed-used commercial real estate assets, devise and implement intelligent break-up solutions to provide high quality flexibl
Slide 9: Case Study: Bedford Heights
Case Study: Bedford Heights • Texas Instruments European HQ: 211,000 sq ft – vacated in 1994 except 76,000 sq ft of production facilities • Acquired in 1999 for £4.4 million (£21 per square foot capital value) • Increased occupancy to 91% to August 2000. This represented a 23%* gross income return o
Slide 10: Why Germany?
Why Germany? Consensus Forecasts (%) 2006A 2007 2008 2009 • Improving economy with 2.7% GDP growth GDP 2.7 1.9 2.2 2.0 in 2006 Investment growth 6.4 4.7 5.0 4.7 Industrial production growth 5.6 2.2 2.9 3.1 • Unemployment fallen from 12% in 2005 to close to 9% in Q1 2007 Unemployment rate 10.8 9.0 7.
Slide 11: SME Market in Germany
SME Market in Germany • In 2005 there were 3.3 - 3.4 million SMEs in Germany • 2.8 million of these SMEs employed less than 10 people • Net new employment positive in 2006 for the first time in six years • More than 42% of SMEs planning new investments in 2006, fourth successive year of growth, but
Slide 12: Initial Portfolio (1)
Initial Portfolio (1) Initial Portfolio Statistics Lease Expiry Timetable (% of Current Rent Roll) Expected no. of properties 20* Market value €m 206* Average occupancy % 76* 25.00% Net passing rent €m 13.0*** 20.00% Fully Let Net Rent €m 18.5** Net initial yield % 6.3*** 15.00% Reversionary yield %
Slide 13: Initial Portfolio (2)
Initial Portfolio (2) Top 10 Lettable areas '000 m² Bremen-1 124 Berlin - 1 37 Maintal-1 33 Magdeburg 28 Bremen-2 24 Rostock-1 18 Bonn - 2 18 Regensburg 17 Berlin - 2 12 Bremen - 3 11 Market Value Lettable €'000 '000 m² Former West Germany 168 330 Former East Germany 38 60 TOTAL 206 390 13 Dawnay, D
Slide 14: Development Potential
Development Potential • Excess land with development potential identified in 9 properties within Initial Portfolio • Development plans for 5 of these have been created and can be summarised as follows: Net Area, m2 Estimated* ERV €’m Cost €’m pa at 100% let Flexiboxes 21,000 1.8 11.7 Warehouse/Logis
Slide 15: Case Study 1: Gartenfeld (Berlin)
Case Study 1: Gartenfeld (Berlin) Vendor: Siemens Real Estate Acquired: February 2006 Lettable area: 29,700m2 * Value: €13.8 million Rent at acquisition: € 379,000 Rent now: € 729,000 % let at acquisition: Offices: 2%, Industrial 40% % let now: Offices: 21%, Industrial 70% Capex to date: € 397,000 P
Slide 16: Case Study 2: Maintal (near Frankfurt)
Case Study 2: Maintal (near Frankfurt) Vendor: Helaba Bank Acquired: October 2006 Lettable area: Offices: 7,600m2 Industrial: 25,000m2 Value: €21.7 million Rent at acquisition: €1.6 million Rent now: €1.7 million % let at acquisition: 71% % let now: 79% Pre "Sirius" Factor Gross ERV @ 90% occupancy:
Slide 17: Current active pipeline
Current active pipeline No. of properties Estimated * purchase price Notes €m Portfolio 1 14 29 Mixed use industrial / office portfolio in Rhine Ruhr area Portfolio 2 2 30 Production & Office facilities outside Munich & Frankfurt Portfolio 3 8 100 Mixed use business parks in prominent locations incl
Slide 18: Organisation Chart
Organisation Chart Kevin Oppenheim CEO Frank Oppenheim Alistair Marks Technical Director Finance Director Ingo Spangenberg Managing Director Manuel Schottmueller Development Manager Vacant Elisabeth Saile Craig Hoskins Financial Controller Company Lawyer Projects manager Finance Team Legal Team Deni
Slide 19: Asset Management Agreement
Asset Management Agreement • Asset management fee • Annual fee based on gross asset value of properties, payable quarterly: • Gross asset value up to €500 million: 0.5% • Gross asset value €500 - €1,000 million: 0.6% • Gross asset value over €1 billion: 0.5%of excess over €1billion + €6m • No additi
Slide 20: Finance
Finance • Total facility of €124m available for acquiring or refinancing the initial portfolio • Includes €100m, 5 year term loan from ABN Amro at a margin of 125bps, 1.1x interest cover covenant. • Target an interest cover of 1.65x • Target Loan to Value : 60-80% * Until 1 December 2007 thereafter
Slide 21: Taxation and Dividends
Taxation and Dividends • Taxation • Dividend policy • No local taxation on income in • Target dividend payout ratio of 60-80% Guernsey of recurring profits • No withholding tax on dividends paid to • Dividends to be paid half yearly shareholders • Effective tax rate estimated at approximately 11%* •
Slide 22: Summary
Summary • Proven track record in acquiring and operating flexible workspace • Compelling market fundamentals in Germany; no direct competition for flexible workspace in well established business locations targeted at the SME market on a nationwide basis • Attractive initial portfolio and visible pip
Slide 23: Appendix: Dawnay, Day Group
Appendix: Dawnay, Day Group • Active in current form since early 1980s specialising in commercial property and financial services • In 2002, diversified into property fund management • Launched Puma Property (DD) Fund LP in 2002 • Peak gross assets in excess of £100 million • Liquidated in 2006 achi
Slide 24: Appendix: Board Structure
Appendix: Board Structure • Board of Directors comprises 5 Non-Executive Directors, 4 of which are independent of the Asset Manager and Dawnay Day • Chairman • Dick Kingston, former FD of Slough Estates (now trading as SEGRO) • Independent non-executive directors • Gerhard Niesslein, CEO of DeTe Imm
Slide 25: Appendix: Proposed Structure
Appendix: Proposed Structure Frank and Kevin Dawnay, Day Shareholders Oppenheim 48% 48% Asset Management Agreement Dawnay Day Dawnay, Day Sirius Sirius Ltd Management Real Estate Asset (Guernsey) 4% Management Limited nt Dawnay, Day Sirius me t cte en Cooperatief U.A. ge tra em d na g -c a n a Ma tM