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Mapletree Logistics Trust has been granted an option to purchase the 9 Changi South Street 2 property at the price of $24.5 million.
Mapletree Logistics Trust (MLT) has been granted by RSH Holdings an option to acquire a logistic property at 9 Changi South Street 2 for $24.5 million.
The property is a part three-storey, part four-storey temperature-controlled warehouse building that comes with ancillary offices. With a gross floor area of about 11,506 sq m, the property occupies a leasehold site with a balance tenure of about 33.3 years.
MLT’s manager revealed that 9 Changi South Street 2 is being sold with vacant possession, adding that it is in talks with an international third-party logistics player to lease as the property’s anchor tenant.
The proposed acquisition, which will be funded by debt, is expected to be completed by the third quarter of FY2021/2022, subject to the approval of JTC Corporation.
Once completed, the acquisition will bring MLT’s aggregate leverage ratio at 38.5%, while the trust’s total portfolio “will comprise 164 properties with total assets under management of $10.8 billion”.
MLT expects the acquisition to generate a stabilised property income yield of about 6.2% based on the purchase price, as well as the initial land premium.
The acquisition is also expected to be accretive to MLT’s distribution.
“With a limited supply of logistics properties in the eastern part of Singapore, 9 Changi South Street 2 is an attractive property given its prime location and a relatively long remaining land tenure of over 33 years,” said Ng Kiat, Chief Executive Officer of MLT’s manager.
“The property is also adjacent to our existing property at 15 Changi South Street 2, thus presenting the opportunity for potential economies of scale,” she added.
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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