ESR-Logos Reit divests 2 Jalan Kilang Barat for S$35.3m, 21.7% above valuation

THE trustee of ESR-Logos real estate investment trust (E-Log), RBC Investor Services Trust, has entered into a sales contract to divest the trust’s property at 2 Jalan Kilang Barat for S$35.3 million, translating to a 21.7 per cent premium to valuation.

As at Thursday (Sep 29) when the announcement was made, an independent valuer had valued the 9-storey purpose-built industrial building located in Singapore’s Bukit Merah district at S$29 million. The property has a gross floor area of 7,679 square metres.

It is approximately 19 years old and has a remaining land lease tenure of 39.8 years.

The divestment is expected to be completed in Q4 2022, and is subject to the Singapore Land Authority’s approval, the trust’s manager said in a bourse filing on Thursday.

Upon its completion, E-Log’s portfolio will comprise 80 properties across Singapore and Australia.

Adrian Chui, chief executive officer of the trust’s manager, said the divestment is in line with its strategy to continue unlocking value from E-Log’s non-core properties, and will give it more flexibility to realise growth aspirations.

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The divestment is not expected to have any material impact on E-Log’s net asset value and distribution per unit for the financial year ending Dec 31, 2022. Net proceeds from the divestment will go towards repaying outstanding borrowings, financing upcoming asset enhancements or redevelopments, and/or funding general working capital requirements.

E-Log units ended Thursday flat at S$0.355.