SINGAPORE - Cambridge Industrial Trust (CIT) has agreed to divest its remaining leasehold interest in a four-storey industrial building in Tuas for S$16.5 million to an existing tenant of the property, Reliance Products Pte Ltd.

The sale price represents a premium of about 5 per cent above the asset's current book value of S$15.7 million and close to double the original purchase price of S$8.55 million in 2006, said the trust's manager in an announcement on Monday (April 11).

It said the building at 23 Tuas Avenue 10 was a non-core asset. It has a gross floor area of around 102,310 sq ft and a remaining land tenure of about 40 years.

Proceeds from the sale will be used to repay debt, as well as fund asset enhancement initiatives and potential acquisition opportunities, said the trust manager.

The transaction, which is subject to approval by JTC Corporation, is expected in June 2016.

Said Mr Philip Levinson, chief executive officer of the trust's manager: "This divestment is consistent with CIT's FY2016 strategy, focused on recycling capital for greater investment flexibility and better returns.

"The manager's strategy for FY2016 will focus on four key areas: divestment of non-core assets; asset enhancement initiatives for existing assets; repaying debt and reducing gearing, and acquisition of quality assets both locally and overseas," he added.