ASCENDAS REAL ESTATE INV TRUST
A17U.SI
Ascendas REIT - Acquisition of two Australian properties for A$168.2m
- Ascendas REIT (A-REIT) announced its proposal to acquire two properties in Australia.
- The first is a business park property in Sydney, for a purchase consideration of A$143.4m (~S$145.6m), from Frasers Property Australia.
- The second is a forward purchase of a logistics property, Stage 4, Power Park Estate, located in Dandenong South, Melbourne for a purchase consideration of A$24.8m (~S$25.2m). Construction of this property is estimated to complete in 1Q17.
- Total transaction costs of A$10.8m are expected to be incurred.
- These acquisitions do not come as a surprise to us, as A-REIT had previously announced that it was conducting due diligence on two potential acquisitions in Australia when it carried out a private placement exercise in early August.
- Consequently, S$112.1m, or ~72.4% of the gross proceeds raised will be used to partially fund the acquisitions. The initial NPI yields (pre-transaction costs) for the Sydney and Melbourne properties are 6.9% and 6.7%, respectively, while both assets’ NPI yield post transaction costs is estimated at 6.5%.
- Maintain BUY and S$2.66 fair value on A-REIT.
Wong Teck Ching Andy CFA
OCBC Investment
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http://www.ocbcresearch.com/
2016-09-13
OCBC Investment
SGX Stock
Analyst Report
2.66
Same
2.660
