CLS Holdings Regulatory News (CLI)

30 Jan 2006 07:00

Release date: 30 January 2006Embargoed until: 07:00 CLS HOLDINGS PLC ANNOUNCES THREE NEW PROPERTY PURCHASES IN GERMANY In line with its strategy announced in November 2005 to establish a portfolioin Germany, CLS Holdings plc ("CLS") is delighted to announce three furtheracquisitions in Germany for a total consideration of ¢â€š¬78.2 m (‚£53.6 m).Firstly, CLS has purchased a new property in Hamburg, known as Jarrestrasse8-10. The building was constructed in 2003 and comprises 5,654 sq m (60,330 sqft) of offices and storage together with car parking. The property is 100% letto 9 different tenants on leases ranging from one to six years, generating anannual rent of ¢â€š¬932,606 (‚£639,560).The initial yield is 7.5%. The initial return and cash return on equity withthe completed loan facility of ¢â€š¬10.4 million (‚£7.13 million) is 23.2%.Secondly, CLS has agreed to purchase Adlershofer Tor, a 19,715 sq m (212,212 sqft) retail and office building in Adlershof Business and Science Park in southBerlin. The average lease length is over 13 years with 45% of the building letto Kaufland, the German retailer, with 17 ‚½ years unexpired. The property willgenerate an initial rental income of ¢â€š¬2,796,344 (‚£1,917,668) and an initialyield of 7.5% upon its expected completion in April 2006. The initialanticipated return on equity is 20% and the cash return on equity isanticipated at 14%.Thirdly, CLS has contracted to purchase the New Head Office of BrainLAB inFeldkirchen, Munich, let on a 10 ‚½ year term with an initial rent of ¢â€š¬2,004,091(‚£1,374,359). The building will comprise 19,466 sq m (209,532sq ft) of office,storage, exhibition space and parking and is expected to be completed bymid-2006. The initial yield is 7.0%. The initial anticipated return on equityis 20% and the cash return on equity is anticipated at 15%.Christian Holle of Immobilien Asset Management GmbH has acted as consultant forCLS on these transactions.Upon completion of these purchases, CLS' property portfolio in Germany willcomprise five properties located in Hamburg, Munich, Berlin and Dusseldorf witha total value of ¢â€š¬84.2 million (‚£57.74 million). Furthermore, CLS intends tocontinue its expansion in Germany in view of the continuing attractive returns.Executive Chairman, Sten Mortstedt, commented:"We are delighted to have been able to acquire these properties either newlyconstructed or in the course of construction with the benefit of good financialreturns. We have now built up a sizeable portfolio in Germany and as we arecontinuing to see quality buildings offered in the market, further acquisitionsare anticipated in the near future." -ends- For further information, please contact:Sten Mortstedt, Executive ChairmanPer Sjƒ¶berg, Chief Executive OfficerDan Bƒ¤verstam, Chief Financial OfficerSteven Board, Chief Operating OfficerCLS Holdings plcwww.clsholdings.comTel. +44 (0)20 7582 7766Adam Reynolds/Ben SimonsHansard Communications+44 (0)20 7245 1100ENDCLS HOLDINGS PLC