Manulife US Reit denies reported $206 million figure for sale of its manager

Phipps Tower in Atlanta in the United States is one of Manulife US Reit's acquisitions. PHOTO: MANULIFE US REIT

SINGAPORE - Manulife US Reit on Friday denied reports of a 200 billion won (S$206 million) figure for the sale of its manager to South Korean asset manager Mirae Asset Global Investments.

The real estate investment trust’s manager was responding to an earlier report by The Business Times, which quoted Maeil Business News Korea as saying that Mirae is the preferred bidder to buy Manulife US Real Estate Management for 200 billion won, as well as part of a stake in the Reit.

In its latest statement, Manulife US Reit’s manager clarified that Mirae’s non-binding proposal “does not contain reference to such a figure” and that the only monetary amount in the proposal relates to the purchase price of the manager’s shares.

It also reiterated that the proposal from Mirae involves the subscription of new units of Manulife US Reit and does not include any offer to acquire existing units.

Due diligence is ongoing, which applies to the number of new units Mirae and its affiliates will be able to subscribe to in order for Manulife US Reit to maintain its US Reit qualification.

The 200 billion won amount appears significant. Manulife US Real Estate Management collected US$8.8 million (S$11.8 million) in fees for the management of Manulife US Reit in financial year 2022, which it chose to receive in units.

In 2019, Vibrant sold a 51 per cent stake in the entity that wholly owns the manager of Sabana Reit for around $20.5 million, with an adjustment sum of around $1.3 million. This implied a valuation of around $42.7 million for the manager.

The manager, Sabana Real Estate Investment Management, collected $4.6 million in fees for the management of Sabana Reit in financial year 2018, before the sale of the stake. THE BUSINESS TIMES

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