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The divestment of 3C Toh Guan Road East and 11 Serangoon North Avenue 5 has been completed for $53 million.
ESR-REIT, via its trustee RBC Investor Services Trust Singapore, has completed the divestment of 3C Toh Guan Road East and 11 Serangoon North Avenue 5 for about $53 million.
The figure excludes divestment costs as well as applicable goods and services tax. It also represents a 3% premium to the properties’ total fair value of $51.5 million as of 30 September, and a 7.1% premium to their total acquisition costs.
ESR-REIT’s manager does not expect the divestment to materially affect the net asset value and net property income of the REIT for the financial year ending 31 December 2021.
It revealed that the divestment’s net proceeds will be used to “repay outstanding borrowings and/or fund upcoming asset enhancements, potential acquisitions, unit buy-back and general working capital requirements”.
Adrian Chui, CEO and Executive Director of ESR-REIT’s manager, shared that the proceeds will be “channelled towards value creation opportunities to improve the quality of our portfolio”.
“With greater financial flexibility, we will continue to seize attractive growth opportunities to deliver greater income growth to unitholders,” he added.
With the divestment, ESR-REIT’s portfolio will comprise 56 properties across Singapore with a total gross floor area (GFA) of about 15.3 million sq ft.
Situated within the Toh Guan Logistics Park, 3C Toh Guan Road East is a five-storey multi-tenanted warehouse housing ancillary office space. It has a remaining land lease tenure of about 29.5 years and a GFA of about 192,864 sq ft.
11 Serangoon North Avenue 5, on the other hand, is a six-storey multi-tenanted general industrial building situated in the Ang Mo Kio Industrial Estate. It has a remaining land lease tenure of about 35.7 years and a GFA of about 146,619 sq ft.
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Cheryl Chiew, Digital Content Specialist at PropertyGuru, edited this story. To contact her about this story, email: cheryl@propertyguru.com.sg.
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