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GIC is understood to have recently divested the Tai Mall in Taoyuan City, Taiwan for about US$450 million (approx. S$615.83 million), reported PERE news.
Singapore’s sovereign wealth had acquired the shopping centre with a gross floor area (GFA) of more than 1 million sq ft in 2008 for US$206 million, making it one of Taiwan’s biggest property deals that year.
While GIC did not publicly announce the sale, the market learned about the transaction after Hong Kong-based private equity property firm ARCH Capital Management revealed last week that its unit ARCH Capital Property Advisors had purchased the mall on behalf of an undisclosed pension fund outside Asia and Taiwan-listed Millerful REIT No. 1.
While the property is already established and fully occupied, ARCH Capital Management’s CEO and Chief Investment Officer Richard Yue believes the mall still has additional upside potential.
“We still see a number of areas where we can improve the performance on factors such as the tenant mix and operation efficiency. The bones of Taimall is very well done and it is a dominant centre in Tayouan, that is one of the fastest growing districts in the greater Taipei area and all of Taiwan.”
Yue revealed that they approached Singapore’s GIC with an off-market offer for Tai Mall. He added that they have been closely monitoring the property’s development for years, aside from keeping track of economic fundamentals like demographics.
“I think Taiwan is quite interesting right now due to the cap rates. They are probably slightly below Australia and Japan, but higher than Hong Kong and Singapore,” he noted.
“The financing is lower than the cap rate, so Taiwan is a fairly stable place to invest, and it is relatively cheaper than all the (other) mentioned places,” Yue added.
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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