Frasers Logistics & Commercial Trust to acquire 3 logistics, industrial properties in Australia
THE manager of Frasers Logistics & Commercial Trust (FLCT) on Friday (Jun 10) announced the proposed acquisition of 3 prime logistics and industrial properties in Victoria, Australia, for a portfolio purchase price of A$61 million (S$60.4 million).
Located in key industrial precinct Truganina and approximately 20 km from Melbourne’s central business district, the 3 buildings were newly completed in early May 2022 and have a total lettable area of 25,089 sq m.
The 3 freehold properties are fully leased to 4 tenants, with a weighted average lease expiry (WALE) of 6.6 years and fixed annual rent increments of 3 per cent.
Post-acquisition, FLCT’s portfolio WALE and occupancy rate will remain at 4.6 years and 96.2 per cent, respectively, the real estate investment trust (Reit) manager said.
The portfolio purchase price is just a whisker below the independent valuation at S$61.1 million as at end May.
Including the stamp duty payable as well as other fees and expenses, the total cost of the acquisition is estimated to be A$65.9 million.
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The Reit manager said this will be fully funded from the divestment proceeds of Cross Street Exchange in Singapore.
FLCT had booked net proceeds of approximately S$802.7 million after divesting its remaining leasehold interest in the mixed-use commercial property.
“This investment marks a continuing deployment of our divestment proceeds from the sale of Cross Street Exchange in Singapore, and will provide FLCT with further exposure to the attractive Melbourne logistics and industrial market,” said chief executive officer of the Reit manager Robert Wallace.
The Reit last month announced plans to acquire a fully leased freehold suburban commercial property in Victoria for A$60.3 million.
“The new properties (in the latest proposed acquisition) are of smaller tenancy sizes, providing a product offering that targets a differentiated tenancy base, making the new properties a complementary fit with FLCT’s existing industrial portfolio,” Wallace said.
The Reit manager said the acquisition, which is expected to complete by the third quarter of 2022, is not expected to have any material effect on FLCT’s net tangible assets.
Units of FLCT closed 0.8 per cent or S$0.01 lower at S$1.33 on Friday, before the announcement.
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