This week was pretty hectic at work, as we needed to finish the annual report. Sirius Facilities is presenting its 2016-2017 financial year results on Monday, so everything needed to be completed and sent to the printers by Friday. It is fair to say I was kept very busy this week, but I enjoyed every second as I continued to receive more and more responsibility as the week progressed. I really enjoy seeing that even with two years of a college education I can make a real impact within a firm. Some of the employees at Sirius took a step back from work on Wednesday to run in a 5.5K charity race. I decided to join, and I finished my first ever race that was longer than a mile or two. This was a really cool experience as I was again able to make some more connections within the office, while also running all throughout the streets and Tiergarten of Berlin!
During my time working for Sirius, I have been able to learn more about the industry it competes in along with some of the opportunities and challenges that it faces as a company. Sirius Facilities is part of the real estate industry and mainly specialize within the business park sector of the industry. Its business parks contain a mixture of office, storage and production space, while seeking to retain major core industrial tenants. These tenants include international blue-chip corporations, but the majority of clients are German SME companies, and Sirius’s business parks are restructured to enhance the working environment of these tenants. This part of the real estate industry really focuses on creating usable space for companies to grow their business operations. The asset management team at Sirius has helped create a range of innovative and flexible products by investing into sub-optimal space. Sirius has acquired the concept of Smartspace, which it believes differentiates the company from the competition in the industry. Its Smartspace products are specifically designed to provide flexibility for the changing requirements of small businesses, and include a fixed price in order to provide certainty for its customers.
Business parks are well-known among European companies, so the competition in Germany is quite large as the country continues to grow its industrial economy. The competitors of Sirius Facilities tend to be companies looking to invest in industrial sites and other hard assets among Germany. Sirius looks to separate themselves from competitors by listing in both the London Stock Exchange (LSE) and Johannesburg Stock Exchange (JSE), which is located in South Africa. This has allowed the company to reach out to more potential shareholders internationally and take advantage of unique opportunities. As a result, Sirius has been able to raise more funds, which they have specifically seen more of among the South African shareholders. South Africa has a lot of rules and regulations against off shore investing, because they want to focus on the well-being and growth of their own country. Even though the economy is very volatile in South Africa, Sirius thought it would give them an edge in the industry and South African shareholders an advantage if they listed on the Johannesburg Stock Exchange. This has allowed them to create great relationships and connections that has helped grow the company with a very positive outlook for future returns. Another opportunity for Sirius, and any other firm in the real estate industry, is acquiring new properties that help expand the business. Sirius mainly specializes in controlling the Southern and Eastern parts of Germany, focusing around cities such as Munich, Frankfurt, and Köln. As a company, it tries to acquire more investment properties in these specific regions/areas so they can dominate the market.
I think a big challenge that exists for firms in the real estate industry is finding good tenants to occupy the company’s buildings. A company desires a tenant who is trustworthy, pays on time, and does not cause extra drama for the business. Within the real estate industry, a company needs tenants in order to be successful, so they must create strategies to obtain the larger and more reliable tenants. This can be challenging as a company must adhere to the needs of its potential customers and make themselves more attractive than other competitors. Another challenge faced by both Sirius and other companies in the real estate industry is finding the best location for its investment properties. Nowadays, location is everything, and companies must understand the markets and methodically choose where it believes its properties will be most successful!
To finish off the week, I have planned a trip to Barcelona! I am super excited and cannot wait to share with you some of my experiences during my time in Spain!