FCT divests 10 strata lots at Yishun 10 to Frasers Property for $34.5 mil
Frasers Centrepoint Trust (FCT) has unloaded 10 strata lots in a strata-titled retail development at 51 Yishun Central 1 (additionally called Yishun 10) to Frasers Property Limited for $34.5 million.
The properties, located beside Northpoint City, are hosted under subsidiary strata certifications of title. The lots have a leasehold term of 99 years commencing from April 1, 1990. They were gotten in 2016 and have an overall gross flooring area of 966 sqm and overall net lettable area (NLA) of 961 sqm.
Given that the net asset value (NAV) of the real properties of $33.5 million is 0.8% to FCT’s NAV of $4.15 billion and the net earnings attributable to the properties of $0.2 million is 0.2% of FCT’s net revenue of $97 million, the divestment is classified as a “non-discloseable transaction” under Rule 1008 of the listing guidebook.
Frasers Property currently possesses the just various other property at Yishun 10, which is the 1,477-seat Golden Village cineplex in Yishun. The company got it from Golden Village Multiplex Pte Ltd on Aug 8 for $48 million.
Frasers Property, through its wholly-owned subsidiary, Lion (Singapore), participated in a sale and purchase contract (SPA) with FCT’s trustee, HSBC Institutional Trust Services (Singapore) Limited, on Aug 25.
That stated, the divestment is regarded to be an interested person transaction and interested party transaction given that Frasers Property is the REIT’s sponsor. Frasers Property, with Frasers Property Retail Trust Holdings Pte. Ltd. and FCT’s supervisor, has a 37.94% stake in FCT. FCT’s supervisor is in addition a wholly-owned subsidiary of Frasers Property Limited, in which the latter is considered as a “controlling shareholder” of the manager.
Upon the completion of the latest suggested purchase, Frasers Property will conclude full ownership of Yishun 10 and operations at Yishun 10 will proceed customarily.
The sale consideration factored in the current valuations of the real estates as at May 31. The properties were worth by Jones Lang LaSalle Property Consultants Pte Ltd (JLL) and Savills Valuation and Professional Services (S) Pte Ltd. The agreed property worth is the average of JLL’s valuation of $34 million and Savills’ valuation of $35 million.
The divestment is exempt to FCT’s unitholders’ authorization as it comprises 1.17% of the net tangible assets (NTA) and NAV of FCT as at Sept 30, 2024, and lower than the required 5% of FCT’s most current audited NTA and NAV under Rule 906( 1) of the listing manual and paragraph 5.2 (b) of the property funds appendix.
According to Frasers Property, the proceeding was made to “optimize capital productivity with active profile management initiatives”. “The suggested purchase will potentially permit the group to generate additional worth from the longer-term redevelopment capacity of the asset,” it includes.
According to FCT, the divestment remains in line with the manager’s proactive portfolio management approach to optimize portfolio composition and its revenues. The supervisor claims it plans to use the net proceeds of $33.8 million to pay off “specific financial obligation”, which will reduce FCT’s aggregate leverage. The net total accounts for other divestment related expenses of approximately $0.2 million and transfer of lessees’ down payment of roughly $0.5 million.
