Cache Logistics Trust to develop warehouse for DHL company

SINGAPORE - Cache Logistics Trust has agreed to develop a build-to-suit warehouse for DHL Supply Chain Singapore and lease it to the company, which is part of Deutsche Post DHL, the world's leading logistics solutions provider.

The development cost for the warehouse, located at Greenwich Drive in Tampines LogisPark, is estimated to be $105.1 million, said the trust's manager ARA-CWT Trust Management (Cache).

Other non-development expenses, including finance and transaction costs, are expected to come up to $18.4 million.

Cache will fund the development through internal funds and bank borrowings, with its leverage expected to increase from 29.1 per cent as at Dec 31 last year to 34.8 per cent upon completion of the development.

Cache has also signed a fixed price building works contract with construction company Precise Development for the project, and has accepted a JTC Corporation letter of offer in relation to the land lease at Tampines LogisPark.

The development for DHL Supply Chain will comprise two blocks: a three-storey ramp-up warehouse with a four-storey ancillary office, and a two-storey ramp-up warehouse.

It will have a land area of about 638,400 sq ft and a total floor area of about 989,200 sq ft, ARA-CWT Trust Management (Cache) said.

DHL Supply Chain will occupy 100 per cent of the three-storey block after completion, half of the two-storey block three years after completion, and the other half of the two-storey block five years after completion.

All three lease terms will terminate together at the end of the initial 10-year lease. DHL Supply Chain will have an option to renew the lease for three additional five-year terms, plus a fourth renewal term for the remaining land lease period.