Bookmark & Share
CapitaLand Commercial Trust (CCT) has sold One George Street for S$1.18 billion to limited liability partnership, One George Street LLP (OGS LLP), in which it will hold a 50 percent stake.
The other 50 percent will be held by joint venture partner OGS (II) Limited, a special purpose vehicle owned by insurer FWD Group.
Based on the building’s 41,478 sq m (446,473 sq ft) net lettable area, the S$1.18 billion agreed value works out to S$2,650 per sq ft and is 16.7 percent above the Grade A office tower’s valuation of S$1.01 billion as at 31 December 2016.
“Based on One George Street’s net property income of S$38.0 million for the 12 months preceding 31 March 2017 and the agreed value, the net property yield translates to 3.2 percent per annum,” said the trust’s manager in an SGX filing.
With this, CCT is expected to recognise an estimated gain of S$84.6 million on the property’s divestment on a 50 percent basis. The expected net gain, on the other hand, is S$79.7 million.
“The divestment of One George Street to OGS LLP is in line with the trust’s portfolio reconstitution strategy to proactively enhance the value of CCT’s portfolio and increase our financial flexibility to invest in other compelling and sustainable growth opportunities so as to improve returns to unitholders,” said Lynette Leong, CEO of the trust’s manager.
Conveniently situated near Clarke Quay, Raffles Place and Chinatown MRT stations, the 23-storey One George Street has a committed occupancy rate of 96.5 percent as at 31 March 2017, with the top three tenants including Diageo Singapore Pte Ltd, Borouge Pte Ltd and Her Majesty The Queen in Right of Canada, as represented by the Minister of Foreign Affairs.
This article was edited by Denise Djong.
Related Articles:
Office rents may bottom out in 2017: OCBC
Frasers Commercial Trust revenue up 3.2% in Q2 FY17
More property investors eyeing S’pore, says CBRE
Firms may look to cheaper areas amid expected rebound in CBD rent