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The seven-storey warehouse is located at 7 Tai Seng Drive and is served by three cargo lifts, standing on a land area of about 8,968 sqm, with a gross floor area of 23,844 sqm. (Photo: Mapletree Logistics Trust Management Ltd)
Singapore-listed Mapletree Logistics Trust (MLT) recently announced that it has granted its sponsor, Mapletree Investments Pte Ltd, an option to purchase a seven-storey warehouse at 7 Tai Seng Drive, Singapore for S$68 million.
According to an SGX filing last Friday (11 August), the consideration represents a 79 percent premium over the original purchase price of S$38 million in 2006 and is 114 percent above the latest valuation of S$31.8 million as of 31 March 2017.
The subject property is served by three cargo lifts and stands on a land area of about 8,968 sqm, with a gross floor area of 23,844 sqm. Given its relatively small land area and attainment of its maximum plot ratio, MLT said there is limited potential for redeveloping it into a modern, ramp-up logistics facility.
“As part of our continuing efforts to improve the quality and yield of MLT’s portfolio, we are looking to divest 7 Tai Seng Drive, a 20-year old building with older warehouse specifications and limited scope for future enhancement. The capital released will increase our financial flexibility to invest in better quality assets with modern specifications,” said Ng Kiat, CEO of Mapletree Logistics Trust Management Ltd.
The proposed sale is expected to be completed by the fourth quarter of FY2017/2018, subject to Mapletree Investments’ exercise of the option and approval by JTC Corporation.
It is also not expected to have a material effect on MLT’s net property income and net asset value for the aforementioned financial year. Moreover, Mapletree Logistics Trust Management will get a divestment fee based on 0.5 percent of the sale price and this will be paid in MLT units.
As of 30 June 2017, the trust owns 127 logistics assets collectively worth S$5.5 billion across Singapore, Malaysia, Vietnam, China, Hong Kong, South Korea, Japan and Australia.
This article was edited by Denise Djong.
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