CapitaLand Ascendas Reit to divest industrial building in Macpherson for S$35.4m

CAPITALAND Ascendas Reit (Clar) is divesting an industrial property in Macpherson for S$35.4 million, its manager said in a bourse filing on Thursday (Apr 20).

The sale consideration of the building, KA Place, represents a 219 per cent premium to its original purchase price of S$11.1 million in March 2005. It also represents a 55 per cent premium to the property’s market valuation of S$22.8 million as at Dec 31, 2022.

The manager said the proposed divestment is in line with its proactive asset management strategy to improve the quality of Clar’s portfolio and optimise returns for unitholders.

Assuming the proposed divestment was completed on Jan 1, 2022, the pro forma impact on Clar’s FY2022 results would be a S$920,000 fall in net property income, and a 0.005 Singapore cent decline in distribution per unit.

The manager expects net proceeds after divestment costs to be S$30.7 million.

Net proceeds may be recycled to fund committed investments, repay existing indebtedness, extend loans to subsidiaries, fund general corporate and working capital needs and/or make distributions to unitholders, the manager said.

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The manager said the proposed divestment will likely be completed within the second quarter of 2023, and it does not expect the divestment to have any material impact on its net asset value and distribution per unit for its financial year ended Dec 31, 2023.

KA Place – located at 159 Kampong Ampat – is a seven-storey high-specification industrial building, with a total gross floor area of 10,163 square metres and a remaining land lease tenure of 35 years.

Units of Clar closed 1.1 per cent higher at S$2.88 on Thursday, before the announcement was made.