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Viva Industrial Trust inks agreement to acquire property for S$45m
Viva Industrial Trust (VIT) has entered into a put and call option agreement for the acquisition of a property at 30 Pioneer Road for S$45 million.
The purchase price excludes an estimated upfront land premium for the balance of the initial 30-year lease term amounting to S$6.1 million.
This formalised agreement follows a memorandum of understanding inked with GKE Warehousing & Logistics Pte Ltd in July.
Pending the relevant approvals, the acquisition is expected to be completed by the fourth quarter of this year. With this, VIT's portfolio will increase by 5.7 per cent to about S$1 billion.
The property - a four-storey warehouse and a seven-storey ancillary office with total gross floor area of 281,090 sq ft - will be leased back to GKE Corporation Limited for a term of five years from completion of the acquisition with rental escalation of 5 per cent in the third and fifth year of the lease term, and an option to renew for another five-year term.
With the vendor leasing back the property to house its logistics operations, the property is expected to enjoy 100 per cent occupancy during the lease term.