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Ascendas REIT revealed that the purchase consideration includes the land and development cost. Photo: CapitaLand
Ascendas Real Estate Investment Trust (Ascendas REIT) is acquiring a new logistic property in Sydney, Australia for A$23.5 million (S$21.1 million).
This comes after Perpetual Corporate Trust Limited – the trustee of Ascendas Longbeach Trust No. 10 which is indirectly fully owned by Ascendas REIT – signed the agreement to buy the freehold land located within the inner-western Sydney industrial precinct of Yennora and the ensuing development of the property.
The logistic property will be developed by Larapinta Project, with completion expected in the second quarter of 2021.
In a release, Ascendas REIT revealed that the purchase consideration includes the land and development cost. It noted that the consideration is lower by 19.8% than the property’s “as if complete” market valuation, which stands at A$29.3 million as at 30 June 2020.
Ascendas REIT also expects to incur an estimated total transaction cost of A$1.43 million (S$1.29 million) from the acquisition, which includes fees payable to the manager and stamp duty.
To be funded via internal resources and/or existing debt facilities, the purchase is expected to be accretive to the REIT’s distribution per unit (DPU).
For the first year, net property income yield is about 6.2% of pre-transaction cost and 5.8% of post-transaction costs.
“Despite the COVID-19 pandemic, Sydney continues to be the strongest industrial market in Australia underpinned by robust tenant demand and sustained levels of investor interest,” said William Tay, Executive Director and Chief Executive Officer of Ascendas Funds Management (S) Limited, the REIT’s manager.
“The acquisition of this new prime grade logistics property gives Ascendas Reit greater exposure to the Sydney market and also enhances the quality of our portfolio.”
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Victor Kang, Digital Content Specialist at PropertyGuru, edited this story. To contact him about this or other stories, email victorkang@propertyguru.com.sg