SINGAPORE - ESR-Reit announced that it had on Monday (April 23) entered into a conditional agreement with vendor Tampines Distrihub to acquire a logistics facility for S$95.8 million.
The purchase price includes a consideration of S$86.2 million and estimated upfront land premium payable for the balance lease term of S$9.6 million. The total acquisition cost amounts to S$99.9 million, factoring in stamp duties of S$2.9 million and S$1.2 million in other transaction costs.
Located at 15 Greenwich Drive, the facility is valued at S$96.4 million, and is a four-storey multi-tenanted ramp up logistics facility with ancillary offices, located within Tampines LogisPark, a dedicated logistics park.
The development has a gross floor area of around 455,396 square feet (sq ft) and sits on 271,894 sq ft of JTC leasehold land, with its lease tenure expiring in 2041.
The facility is the first "modern ramp-up logistics facility" within ESR-Reit's portfolio, it said, and is expected to boost ESR-Reit's exposure to the logistics/warehouse sector to 27.1 per cent from 22.6 per cent, and increase its portfolio's occupancy to 91.2 per cent from 90.7 per cent.
ESR-Reit's manager, ESR Funds Management, intends to finance the acquisition entirely through debt financing, but also has the option of financing it through a combination of cash from divestment proceeds, equity, debt or hybrid securities.
Adrian Chui, the Reit manager's chief executive, said that the addition of the asset leverages the demand for logistics real estate and will "provide further income diversification from a wider base of quality tenants by adding leading logistics companies to our existing tenant network".