A-REIT to acquire One@Changi City for S$420 mil

SINGAPORE (Dec 9): Ascendas Real Estate Investment Trust (A-REIT) is acquiring One@Changi City for S$420 million (RM1.27 billion) from seller Ascendas Frasers.

One@Changi City is a nine-storey multi-tenanted business park property located within Changi Business Park.

The property is sited on a land area of 46,969 sqm, which has remaining land lease tenure of 53 years. It has a gross floor area and net lettable area of 71,158 sqm and 63,106 sqm respectively. The current occupancy rate of the property stands at 97.1%.

A-REIT said the acquisition is expected to generate a net property income yield of 5.9% in the first year of ownership, post-acquisition costs.

The annualised pro forma financial effects of the acquisition on the distribution per unit would also be 0.067 cents per unit for the financial year ended March 31, 2015.

Ascendas Frasers is a 50:50 joint-venture between Ascendas Development and a wholly-owned subsidiary of Frasers Centrepoint.

In a separate announcement, A-REIT said the acquisition will partly be funded by the sale of new units that will raise at least S$408 million.

Through a private placement, A-REIT will offer 90 million new units to institutional and other investors at an issue price of between S$2.223 and S$2.290 per share to raise no less than $200 million.

It will also raise at least S$207.9 million through a pro-rata and non-renounceable preferential offering of 93.8 million new units on the basis of three new units for every 80 existing units in A-REIT.

A-REIT last traded at S$2.38. -- theedgemarkets.com