Ascendas Reit to buy new Aussie logistics property

Ascendas Real Estate Investment Trust (Ascendas Reit) is proposing to acquire a new logistics property in Brisbane for A$70.3 million (S$70.9 million), the Reit manager said yesterday.

The property will be developed at 500 Green Road, Crestmead, by Goodman Property Services (Aust) and is expected to be completed in the fourth quarter next year.

It will have a flexible design, offering warehouse sizes from 9,000 sq m to 38,000 sq m. This will allow Ascendas Reit to capture a wide spectrum of market demand, said Ascendas Funds Management.

"This acquisition extends our logistics footprint in key distribution markets that will benefit from the robust domestic consumption and e-commerce demand in Australia," said Mr William Tay, executive director and chief executive officer of the Reit manager.

He said the property will be Ascendas Reit's 10th logistics property in Brisbane and will increase the Brisbane logistics portfolio's net lettable area by 21 per cent to 220,532 sq m.

The Reit is expected to incur an estimated cost of A$1.4 million for the acquisition. Net property income yield for the first year is about 5.6 per cent (pre-transaction costs) and 5.4 per cent (post-transaction costs).

The annualised pro forma impact on FY2019 distribution per unit would be an estimated improvement of 0.014 Singapore cent, assuming the proposed acquisition was acquired and completed on April 1 last year.

Units of Ascendas Reit closed flat at $2.95 yesterday before the announcement.

THE BUSINESS TIMES