Frasers Logistics & Industrial Trust (FLT) is acquiring interests in 12 freehold properties - nine in Germany and three in Australia - from its sponsor Frasers Property for A$644.7 million (S$612.5 million).
The manager will finance the acquisition with a combination of equity and borrowings, it announced yesterday.
The deal, which should close by the end of next month, is expected to increase FLT's distribution per unit.
Frasers Property said the move to divest the properties fits its strategy to recycle capital.
"This enables the group to both optimise capital productivity and support the growth of its Reits," it said.
The divestment is not expected to have any material effect on Frasers Property's net tangible assets per share and earnings per share for this financial year.
The total gross lettable area in square metres of the 12 properties, which are 100 per cent freehold.
Occupancy of the 12 properties, with a long weighted average lease expiry of 8.6 years as of March 31.
Frasers Property holds about 21.2 per cent of FLT's units and wholly owns the Reit manager.
The A$644.7 million price comprises €320.3 million (S$490 million) for the nine German properties and A$125.5 million for the three Australian ones.
The 12 properties have a total gross lettable area of about 297,000 sq m and are 100 per cent freehold, with 100 per cent occupancy and a long weighted average lease expiry of 8.6 years as of March 31.
All of the leases have consumer price index-linked indexation or fixed escalations.
The acquisition will strengthen FLT through geographical diversification, a higher proportion of freehold properties and reduced tenant concentration, said Mr Robert Wallace, chief executive of the Reit manager.