Sirius Real Estate Plc, which owns and operates self-storage facilities, business parks, industrial complexes and offices across Germany, is rolling out a capital-expenditure (capex) program to increase the amount of leasable storage space across its real estate portfolio. The company’s Smartspace offering includes self-storage and office space targeted primarily at small businesses, according to the source. Company officials announced the plan during a discussion of Sirius’ most recent financial earnings report.

"The most significant element of our capex investment initiatives is the transformation of difficult space into our Smartspace products," CEO Andrew Coombs told analysts during the conference call. Rentable space under the Smartspace service begins at 4 square meters.

As of Sept. 30, the company had converted 74,235 square meters, or 6.7 percent of leasable space, across the company’s holdings into rentable Smartspace, according to the source. "We would expect this to increase to closer to 8 percent after the completion of the capex investment initiatives," Coombs said.

Demand for office space by small businesses and self-storage from commercial and residential tenants is rising across Germany, according to the source. Coombs indicated facilities converted to Smartspace office and storage has exceeded €9 per square meter in its core markets. "The demand for both these offerings is very pleasing, and generally, 12 months after the space becomes ready to let, we are consistently seeing these become more than 90 percent occupied in our core locations," he said.

The company’s net asset value per share increased 5.5 percent to €50.13 as of Sept. 30, compared to €47.51 at the end of March. Sept. 30 marks the first six months of its 2016 fiscal year.

Sirius Real Estate operates a diversified property portfolio across Germany with more than 1 million square meters of leasable space. The company specializes in business parks but also offers portable-storage containers, flex office and warehouse-storage space as well as more traditional office and self-storage services through Sirius Facilities GmbH. Sirius Facilities operates 38 commercial locations, with its primary self-storage offering branded as Smartspace.

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