Schroder European Real Estate takes legal action against tenant

Schroder European Real Estate (SERE) is suing the sole tenant of one of its industrial assets in the Netherlands for €350,000 of unpaid rent.

The £84.2m European Reit said that Dutch electrical engineering and renewable energy specialist Shuurman Beheer had fallen into financial difficulties and ceased operations at the property in Alkmaar. It subsequently failed to meet its lease obligations.

The board has initiated legal proceedings, including enforcement of the rental guarantee and after actively marketing the premises, said it had seen ‘good initial interest’ from prospective occupiers.

SERE holds 15 assets across commercial real estate in continental Europe, with the Alkmaar property accounting for around 5% of portfolio income. It is currently wallowing on a 38% discount to net asset value (NAV), pending uncertainty around tax claims and a tenant leaving its biggest holding. 

The trust remains in a deadlock over a €14.2m payment demand from the French tax authority, including interest and penalties relating to its investment structure. The board, alongside professional advisers, believes the amount is not due and has therefore not made a provision, although the cash has been ring-fenced as a precaution. 

SERE offers a dividend yield of around 8%, but questions have been raised over future income after Dutch telecoms group KPN formally notified the trust it will terminate its lease on a property in Apeldoorn in December 2026.

The asset accounts for around 6% of the portfolio’s value and roughly 19% of rental income, making securing a new tenant or selling the building altogether a priority for fund manager Jeff O’Dwyer. 

In January, Phil Redding, former chief executive of Tritax Eurobox and Segro, joined the board and will take over as chair following the annual general meeting later this month.