Paragon Reit declines sponsor Cuscaden Peak Investments’ offer to buy The Seletar Mall

PARAGON Reit : SK6U 0% has declined an offer from its sponsor, Cuscaden Peak Investments, to acquire The Seletar Mall for S$550 million.

On Thursday (Feb 29), the real estate investment trust’s manager said the offer was made on the basis of its right of first refusal. 

The manager said: “The trustee and the manager have considered the offer, and are of the view that acquiring The Seletar Mall based on the proposed terms set out in the offer would not be in the best interests of Paragon Reit.”

The transaction would be dilutive to the Reit’s distribution per unit, Paragon Reit’s manager said. It will continue to explore opportunities for the acquisition of yield-accretive assets which are in line with its investment criteria and strategy.

The Business Times reported in January that Allgreen Properties, part of the Kuok Group, was in exclusive due diligence to buy The Seletar Mall.

Word in the market was that the price could be about S$520 million.

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Located next to Fernvale LRT station in the Sengkang West area, The Seletar Mall is on a site with a 99-year leasehold tenure from 2012; this leaves a balance of about 87 years.

FairPrice Finest, Shaw Theatres, Popular Bookstore and Harvey Norman are among the tenants at the mall, which has a total net lettable area of about 189,500 square feet. 

The mall, which opened in November 2014, has six levels of retail space, including two basement floors. Another three lower basement floors are for car parking spaces.

The suburban shopping centre in Sengkang is supported by a strong customer catchment from the surrounding Housing and Development Board flats as well as private condos and landed homes a short distance away.

The Seletar Mall is owned by Cuscaden Peak Investments and United Engineers. 

Cuscaden Peak Investments – formerly known as Singapore Press Holdings before its privatisation in May 2022 – is a wholly owned subsidiary of Cuscaden Peak, a consortium made up of three shareholders: Hotel Properties Ltd, Mapletree Investments and CLA Real Estate Holdings.

Units of Paragon Reit closed flat at S$0.825 on Thursday.