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Ascendas Real Estate Investment Trust (Ascendas Reit) is selling No.13 International Business Park (pictured) for $24.8 million.
This comes after its trustee, HSBC Institutional Trust Services (Singapore), entered into a sale and purchase agreement with Pension Real Estate Singapore for the sale of the seven-storey business park building.
With a gross floor area of 10,116 sq m, No.13 International Business Park has an occupancy rate of 39.6 percent as at 30 June 2017. At around 10.7 years old, the property has a remaining lease tenure of around 47 years.
In a release, the Reit’s manager revealed that the $24.8 million proposed sale price is 24 percent higher than the property’s original price of $20 million. It is also higher than its market valuation as at 31 March 2017 of $22.4 million.
However, it noted that the valuation carried out by Edmund Tie & Co. (SEA) used the “capitalisation approach and discounted cash flow analysis”.
It added that the proposed divestment, which has been approved by JTC Corporation, is not expected to materially affect the net asset value as well as distribution per unit of Ascendas Reit for FY2017/2018.
“Net proceeds after divestment costs are expected to be $24.6 million,” it said.
“The proceeds may be recycled to fund committed investments, used to repay existing indebtedness, extend loans to subsidiaries, and/or fund general corporate and working capital needs.”
The transaction is set to be completed in Q3 2017, following which Ascendas Reit will hold 29 properties in Australia and 101 properties in Singapore.
Romesh Navaratnarajah, Senior Editor at PropertyGuru, edited this story. To contact him about this or other stories, email romesh@propertyguru.com.sg
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