Saturday, August 25, 2012

Venture Corp buying A-Reit's Techplace property for $38m


Business Times: Sat, Aug 25

ASCENDAS Real Estate Investment Trust (A-Reit) has entered into an agreement to sell a leasehold property at Techplace II to Venture Corp for $38 million.

The property - Block 5006 Techplace II - is one of the six blocks of flatted factory buildings at Techplace II located at Ang Mo Kio Avenue 5. It has a tenure of 40 years and a gross floor area of 18,018 square metres.

Venture Corp is the largest tenant at Techplace II.

Ascendas Funds Management, the manager of A-Reit, said the Reit's trustee, HSBC Institutional Trust Services, has entered into a put and call option agreement with Venture Corp for the divestment of the leasehold estate.

"This is an unsolicited offer to purchase from Venture and the price was arrived at through negotiation on a willing-buyer, willing-seller basis," Ascendas Funds Management said.

"The divestment is in line with the manager's proactive asset management strategy where it seeks to extract value from its existing portfolio through regular review and rejuvenation of its assets," said Ascendas Funds Management chief executive Tan Ser Ping.

The sale is subject to approval from the relevant authorities and is expected to be completed in the current financial year. In-principle approval has been obtained from JTC.

Assuming that the divestment was completed on April 1 last year, the proforma impact on A-Reit's net property income and distribution per unit for FY11/12 is about $1.46 million and 0.01 cents respectively.

Proceeds from the divestment will be used as A-Reit's working capital.

The industrial Reit counter closed 3 cents or 1.3 per cent higher at $2.32 yesterday.

  
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