FCT divests 10 strata lots at Yishun 10 to Frasers Property for $34.5 mil
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 profits 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 handbook.
Upon the finalization of the most up to date recommended transaction, Frasers Property will conclude full possession of Yishun 10 and business at Yishun 10 will continue customarily.
The sale consideration factored in the current valuations of the properties as at May 31. The properties were valued by Jones Lang LaSalle Property Consultants Pte Ltd (JLL) and Savills Valuation and Professional Services (S) Pte Ltd. The concurred property worth is the standard of JLL’s appraisal of $34 million and Savills’ evaluation of $35 million.
According to Frasers Property, the proceeding was made to “optimize capital performance via active portfolio management initiatives”. “The suggested deal will potentially permit the group to generate additional worth from the longer-term redevelopment potential of the asset,” it adds.
The divestment is not subject to FCT’s unitholders’ authorization as it composes 1.17% of the net tangible assets (NTA) and NAV of FCT as at Sept 30, 2024, and lower than the requisite 5% of FCT’s latest audited NTA and NAV under Rule 906( 1) of the advertisement manual and paragraph 5.2 (b) of the property funds appendix.
Frasers Centrepoint Trust (FCT) has unloaded 10 strata lots in a strata-titled retail development at 51 Yishun Central 1 (also known as Yishun 10) to Frasers Property Limited for $34.5 million.
The properties, located next to Northpoint City, are held under branch strata certificates of title. The lots have a leasehold term of 99 years commencing from April 1, 1990. They were acquired in 2016 and have a complete gross floor area of 966 sqm and complete net lettable area (NLA) of 961 sqm.
Frasers Property, via its wholly-owned subsidiary, Lion (Singapore), entered into a sale and purchase arrangement (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, via Frasers Property Retail Trust Holdings Pte. Ltd. and FCT’s manager, owns a 37.94% claim in FCT. FCT’s manager is also a wholly-owned subsidiary of Frasers Property Limited, in which the latter is considered a “controlling shareholder” of the manager.
According to FCT, the divestment remains in line with the manager’s proactive portfolio management approach to optimise account structure and its yields. The manager claims it plans to make use of the net profits of $33.8 million to pay back “specific financial obligation”, that will certainly reduce FCT’s aggregate leverage. The net amount accounts for some other divestment associated expenses of about $0.2 million and transfer of renters’ security deposits of approximately $0.5 million.
Frasers Property currently possesses the just other property at Yishun 10, which is the 1,477-seat Golden Village cineplex in Yishun. The business got it from Golden Town Multiplex Pte Ltd on Aug 8 for $48 million.
