Singapore-listed and Europe-focused real estate investment trust IREIT Global has secured a 15-year lease with a German federal government body for approximately 6,200 sqm of office space and 1,400 sqm of storage space at Darmstadt Campus in Germany.
The new tenant is a 100% owned agency of The State of Hesse that performs construction and property/facility management on behalf of The State of Hesse.
The lease, representing approximately 25% of the total lettable area at the property, will commence on 1 June 2023, has a long lease duration of 15 years, and two prolongation options of five years.
With rents secured at market levels, the new lease will generate an annual rental income of approximately €1.2 million.
The new lease was concluded only four months after the previous sole tenant, GMG Generalmietgesellschaft mbH (GMG), a subsidiary of Deutsche Telekom, had vacated Darmstadt Campus. The lease once again demonstrates the Manager’s ability to attract new quality tenants and diversify its tenant mix away from legacy tenants in IREIT’s portfolio.
With this new lease, the overall occupancy rate of IREIT’s portfolio would have improved from 88.3% to 90.3% as at 31 December 2022 on a pro forma basis, while the overall weighted average lease expiry would have improved from 5.0 years to 5.2 years.
Louis d’Estienne d’Orves, Chief Executive Officer of the Manager, said, “We are very pleased to have achieved this breakthrough within such a short period of time. This demonstrates the quality of our property and operating team on the ground. With the lease only expiring in 2038, it will further help to improve the long-term stability of IREIT’s portfolio performance and spur increased interest among other current interested parties to commit leases with us.”
“Our key focus for 2023 and the immediate future is to continue to actively engage our existing tenants while attracting new occupiers to strengthen our tenant mix. We will also continue to pursue investment opportunities to further diversify and grow IREIT’s income streams and mitigate any impact on IREIT’s future distributions,” d’Estienne d’Orves added.
Click here to receive CRE Herald’s weekly newsletter, news alerts and insights!