Mapletree Industrial Trust unit to divest Changi industrial building for S$13m

THE manager of Mapletree Industrial Trust (MIT) announced in a filing to the Singapore Exchange (SGX) that the real estate investment trust (Reit) has agreed to sell an industrial building at 19 Changi South Street 1 to Esco Micro at a proposed price of S$13 million in cash.

The property is held by Mapletree Singapore Industrial Trust, a wholly-owned subsidiary of MIT.

The sale price represents a 4.8 per cent premium over the purchase price. It was acquired on Oct 21, 2010 as part of MIT's initial public offering portfolio for S$12.4 million. As at Nov 5 this year, the industrial building was valued at S$11.9 million and contributed about 0.2 per cent to MIT's portfolio gross revenue in the financial year ended March 31, 2021.

Net proceeds from the divestment will be deployed to fund committed investments and working capital requirements and/or reduce existing debt, MIT's manager said in the bourse filing on Thursday (Dec 23).

The property, a 2-storey light industrial building with a 4-storey extension block located within the Changi South Industrial Estate, spans 82,737 square feet. Its 30-year land lease commenced on Nov 16, 1996, with an option to extend for another 30 years.

The building has been vacant since September 2021 following the lease expirations of its anchor tenants, MIT said. The manager has assessed that it would be "difficult to secure a suitable mix of anchor tenants in the near term".

Given its relatively "small" land area of 67,513 sq ft, the manager has also assessed that it would not be economically viable to redevelop the site, MIT noted.

The divestment is expected to be completed by the first half of 2022, and is subject to approval by JTC Corporation.

The counter closed at S$2.65 on Thursday, up S$0.01 or 0.4 per cent.