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Frasers Centrepoint Trust to raise stake in Waterway Point in S$90m deal

Frasers Centrepoint Trust (FCT) is looking to build its stake in Waterway Point to 40 per cent in a nearly S$90 million deal, just months after acquiring a one-third interest in the suburban mall. 

“This acquisition is aligned with our strategy of increasing FCT’s market share in Singapore’s suburban retail sector," said Richard Ng, chief executive officer of FCT's manager, Frasers Centrepoint Asset Management, in a statement on Friday night.

"We are growing our stake in Waterway Point as it is a popular retail hub that is set to benefit from the growing population and exciting developments in the surrounding Punggol precinct," Mr Ng said. "This positions Waterway Point well to deliver long-term growth and good returns for FCT and its unitholders.”

FCT seeks to acquire the additional 6.67 per cent stake in Waterway Point through a conditional sale and purchase agreement with Sekisui House, which currently holds a third of the total issued units of Sapphire Star Trust (SST), an equal three-way joint venture between Sekisui and two others to develop the property.

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The acquisition is expected to cost FCT some S$89.6 million, to be funded by a combination of debt and internal sources. 

The purchase price was based on an agreed value of Waterway Point at S$1.3 billion or S$3,502 per square foot (psf) of net lettable area (NLA), on a 100 per cent basis - the same basis as the earlier acquisition. 

FCT had raised about S$67.7 million in an oversubscribed preferential offering in June, as part of a larger equity funding exercise to finance the Waterway Point acquisition as well as to pare down the bridging loans used for an acquisition of an 18.8 per cent stake in PGIM Real Estate Retail Fund.