UOA REIT offered two properties

KUALA LUMPUR: UOA Asset Management Sdn Bhd, the management company of UOA Real Estate Investment Trust (UOA REIT), has received two offer letters dated March 8 from UOA Holdings for the sale of two properties here, UOA REIT announced to Bursa Malaysia on the same date.

The properties being offered for sale are Parcel B - Menara UOA Bangsar from Desa Bukit Pantai Sdn Bhd (DBP), a subsidiary of UOA Holdings, and Wisma UOA Damansara II from Rich Accomplishment (RA) Sdn Bhd, also a subsidiary of UOA Holdings, at a consideration of RM289 million and RM211 million respectively.

Parcel B – Menara UOA Bangsar comprises Tower Block B, comprising 15 levels of office space (Levels 9 to 23), three retail podium levels (Lower Ground, Levels 1 and 2), six levels of elevated car park (Levels 3 to 8), and four levels of basement car park, which contain 1,223 car park bays.

Currently used for commercial and retail purposes, the property has a total land area of about 78,340 sq ft and a total net lettable area of about 312,298 sq ft. The recently completed building has a 99-year leasehold tenure, which will expire in 2016. According to UOA REIT, the property has an occupancy rate of 88.5% as at December 2009.

The total purchase consideration of RM289 million will be satisfied via the following: a sum of 0.01% of the purchase consideration as a refundable earnest deposit and towards part payment of the purchase consideration upon execution of the sale and purchase (SPA) agreement; a cash consideration of RM156.03 million; and the issuance of 102.26 million new REIT units based on the five-day volume weighted average price of the REIT units up to and including March 5 of RM1.30 per unit.

Meanwhile, Wisma UOA Damansara II contains a 16-storey building and five levels of basement parking made up of 600 parking bays, and a piece of land measuring 3,497 sq m. Currently used for commercial and retail purposes, the property has a total land area of about 37,641 sq ft and contains a total net lettable area of about 296,850 sq ft.

The building is two years old with a freehold tenure, and has an occupancy rate of 87% as of December 2009, said UOA REIT.

The total purchase consideration of RM211 million will be satisfied through the following: a sum equivalent to 0.01% of the purchase consideration as a refundable earnest deposit and towards part payment of the purchase consideration upon execution of the SPA agreement; a cash consideration of RM113.92 million; and the issuance of 74.66 million new REIT units based on the five-day volume weighted average price of the REIT units up to and including March 5 of RM1.30 per unit.

The offers are subject to, among other things, negotiations, due diligence investigations, and the execution of the definitive agreements within a month from the date of acceptance or such other period mutually agreed upon by the parties, said UOA REIT.

According to the terms of the agreement, the sale is subject to the execution of the final and definitive sale and purchase agreement, the approval of the board of directors of UOA Asset Management and OSK Trustees Bhd, the approval of the Securities Commission for the proposed acquisition and issuance of new REIT units and the approval of Bursa Securities for the listing of and quotation of the new REIT units to be issued, and the approval of the unit holders for the issuance of the new units.