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ESR-REIT has entered into a conditional agreement to acquire a four-storey ramp-up logistics facility (pictured) at 15 Greenwich Drive for $95.8 million.
With an occupancy of 100 percent, the multi-tenanted logistics facility comes with ancillary offices and is located within Tampines LogisPark.
It has a gross floor area of about 455,395 sq ft and sits on a 271,894 sq ft site with a 30-year lease tenure expiring in 2041.
Fronting the Kallang-Paya Lebar Expressway, the facility is easily accessible to Changi Airport and Seletar Aerospace Park. It is also near Paya Lebar Airbase, offering potential upside when the airbase relocates in 2030 and the site undergoes redevelopment.
ESR-REIT’s manager revealed that it intends to finance the acquisition through debt financing. However, the acquisition may also be financed via “a combination of cash from divestment proceeds, equity, debt and/or hybrid securities”.
“When completed, the acquisition is expected to boost ESR-REIT’s portfolio, expanding the REIT’s exposure to the Logistics/Warehouse sector from 22.6 percent to 27.1 percent, and increasing its portfolio’s occupancy from 90.7 percent to 91.2 percent,” it said.
Adrian Chui, CEO of ESR-REIT’s manager, said the facility is expected to “provide further income diversification from a wider base of quality tenants by adding leading logistics companies to our existing tenant network”.
“This is in line with our overall portfolio enhancement strategy of creating a more balanced, modern and diversified mix of assets in order to generate stable and recurring returns for our unitholders,” he 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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