Starhill Global Reit divests Tokyo property for 410m yen

STARHILL Global Reit (SGReit) has divested Harajuku Secondo Property in Tokyo for 410.2 million yen (S$5.1 million), at a 22.4 per cent premium to its latest valuation.

SGReit's manager, YTL Starhill Global Reit Management, said in a Singapore Exchange filing on Monday the transacted price translates to a yield of 2.5 per cent, based on the net property income for the financial year ended June 30, 2016.

Harajuku Secondo was valued at 335 million yen as at March 31, 2017, and accounts for 6.6 per cent of the Japanese portfolio and 0.1 per cent of SGReit's portfolio by asset value.

Pursuant to this transaction, SGReit's portfolio in Japan will be reduced to three properties and the exposure to Japan by asset value will consequently be reduced by about 0.1 per cent to 1.9 per cent of SGReit's asset value, YTL Starhill Global said.

SGReit's gearing is expected to decrease from 35.3 per cent to 35.2 per cent assuming that the net sales proceeds are substantially used to repay the yen loans.