A-REIT – BT

A-Reit portfolio expands with 2 deals sealed

ASCENDAS Real Estate Investment Trust (A-Reit) has completed the acquisition of two buildings in Singapore for $179 million in total.

A-Reit bought Corporation Place at 2 Corporation Road for $99 million, a seven-storey high-spec industrial building with a gross floor area of 76,185 square metres (sq m) and a net lettable area of 57,645 sq m.

The building, which is located in the established Jurong industrial estate, is 80 per cent occupied, and houses tenants such as Hewlett Packard, Panasonic and Sunningdale Tech.

The seller is Corporation Place Limited, a company in which CapitaLand has a 75 per cent interest. CapitaLand is expected to recognise a gain of about $14.5 million.

A-Reit has also acquired 3 Changi Business Park Vista for $80 million. The six-storey building is A-Reit’s sixth property within the Changi Business Park.

It has a gross floor area and net lettable area of 18,388 sq m and 15,261 sq m respectively and its current occupancy is about 95 per cent.

The acquisitions are expected to have an annualised pro forma financial effect of an additional 0.1 cent per unit on the distribution per unit (DPU) for the fiscal year ended March 31, 2011.

The property trust now owns a total of 97 properties with the latest acquisitions.

For the two acquisitions, A-Reit is expected to incur an estimated transaction cost of about $2.21 million, including $1.79 million in acquisition fees paid to the manager, or 1 per cent of the totaL purchase price.

‘The location and specifications of these properties will further strengthen A-Reit’s market position in the Jurong Lake District and Changi Business Park area and enhance its operational efficiency,’ said Tan Ser Ping, chief executive officer of Ascendas Funds Management (S), the manager of A-Reit.

A-Reit units closed trading 2.3 per cent lower at $1.92 yesterday.