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CMT to sell Rivervale Mall to private equity fund for S$191m
THE manager of CapitaLand Mall Trust (CMT), announced on Thursday that CMT has agreed to sell its property, Rivervale Mall, to a private equity fund managed by AEW Asia for S$190.5 million.
Located in Sengkang New Town, Rivervale Mall is held on a 99-year leasehold title starting from Dec 6, 1997, with a remaining lease term of about 81 years.
Completed in 2001, it is a three-storey shopping mall with a net lettable area of 81,159 square feet. The mall is fully occupied as at Sept 30, 2015. Its major tenants include NTUC, Daiso, McDonald's and United Overseas Bank.
Based on the latest independent valuation as at end-June 2015, the property is worth S$116 million. CMT will realise a gain of about S$72 million from the sale of Rivervale Mall after taking into account the divestment fee and other divestment related expenses.
Wilson Tan, CEO of the Reit manager, said: "The optimal option for Rivervale Mall after our evaluation was a sale of the asset, as it would unlock the highest value for our unitholders. As Rivervale Mall only makes up about one per cent of CMT's total deposited property value, its divestment presents minimal impact to CMT's financial performance and distribution per unit. The net sale proceeds of about S$188 million will enhance CMT's financial flexibility."
The sale of Rivervale Mall is expected to be completed in mid-December 2015. After divesting the mall, CMT will own a portfolio of 16 operational malls in Singapore.
CMT's shares added two Singapore cents or one per cent to S$2.02 on Thursday.
Colliers was the exclusive sale adviser appointed by the manager of CMT to conduct a competitive bidding process.