SINGAPORE - Frasers Logistics & Industrial Trust (FLT) is acquiring a portfolio of seven major industrial assets in Australia from Frasers Property Australia, a division of FLT's sponsor, Frasers Centrepoint Ltd, for approximately A$169.3 million (S$175.1 million).
The portfolio, which comprises four completed properties and three properties currently under development, are all fully leased or pre-committed, FLT and its sponsor said in separate filings with the Singapore Exchange on Tuesday (June 6).
The properties are located in Australia's three largest industrial and logistics markets - Sydney, Melbourne and Brisbane.
They have a weighted average lease expiry of 9.6 years, which FLT said will provide income stability and resilience. Their tenants - which include Stanley Black & Decker, Clifford Hallam Healthcare, Beaulieu Carpets, CEVA Logistics and Ecolab - serve the growing consumer and third-party logistics sectors in Australia, FLT said.
The aggregate acquisition amount was negotiated on a willing-buyer and willing-seller basis and is supported by independent valuations, said FLT.
Mr Robert Wallace, chief executive officer of the Reit manager, said the proposed transaction will add further diversity to FLT's tenant base and increase rental contributions from consumer sector tenants.
"These modern industrial properties, which are 100.0 per cent leased or pre-committed to incoming tenants, are also expected to be DPU (distribution per unit) accretive," he said.
He added that FLT will continue to assess opportunities that are complementary to the existing FLT portfolio in order to achieve long term growth in DPU, while maintaining an appropriate capital mix.
Following the proposed transaction, the total value of FLT's portfolio will increase by 9.7 per cent from A$1.74 billion to an aggregate of approximately A$1.91 billion, and from 54 to 61 properties. Gross leasable area will increase 10.1 per cent to approximately 1.35 million square metres from approximately 1.23 million sq m.
The proposed acquisition is subject to approval by unitholders at an extraordinary general meeting to be convened by FLT at a later date.