Sirius Real Estate posts 50% drop in new tenant enquiries

German office property investor Sirius Real Estate has posted a 50% reduction in the run rate of core enquiries for new tenants. Sirius estimated this will translate into a 10% reduction in new lettings in March and a 35-40% reduction in monthly new lettings throughout April and into May. This could lead to a circa 1% reduction in underlying occupancy, said the company. In response to Covid-19, all meeting room and conference facility hire has been put on hold until the end of April, which will “have a marginal impact on revenues and cash flow”. The fall in demand is offset, however, by an increase in demand for storage space from both new and existing commercial tenants as well as new self-storage customers. Storage amounts to around 35% of space in Sirius’s portfolio. Sirius said that although it is still early on in the spread of Covid-19 in Germany, there has been “no increase in the level of contract terminations or failure to meet rental payments above normal levels”. The company expects the coronavirus pandemic will not have a “material impact” on its trading profit for the year ending March. To send feedback, e-mail pui-guan.man@egi.co.uk or tweet @PuiGuanM or @estatesgazette