Sabana Reit's Tuas industrial building sale off the table

SABANA Reit's divestment of a Tuas industrial building is off for now after the purchaser did not obtain approvals from JTC.

The buyer Kim Soon Lee (Lim) Heavy Transport is not prepared to further extend the long-stop date, the Reit said in a Singapore Exchange filing on Saturday.

In September 2018, Sabana had proposed to sell the building at 1 Tuas Avenue 4 for S$11.18 million in cash, 52 per cent below the property's book value of S$23.3 million as at June 30.

The divestment had been part of an effort to improve performance for unitholders by divesting non-performing or mature assets.

Sabana had expected the sale to be completed by the fourth quarter of its fiscal year ended Dec 31. That would have "delivered immediate cost efficiencies" and improved the Reit's overall occupancy from 84.5 per cent to 87.5 per cent as if the divestment occurred on June 30, 2018.

According to its announcement of the proposed sale, the property has been vacant and remained uncompleted after the former master tenant developing it as a data centre surrendered its lease agreement.

The property was reverted to its original general B2 industrial use for the proposed sale.

Sabana Reit closed on Friday at S$0.42, up half a cent or 1.21 per cent.