SGinvestors.io ~ where SG investors share. Visit our new home @ https://sginvestors.io. We appreciate your continuous support :)


Ascendas REIT - OCBC Investment 2016-12-06: Proposed acquisition of Science Park Drive Property

Ascendas REIT - OCBC Investment 2016-12-06: Proposed acquisition of Science Park Drive Property ASCENDAS REAL ESTATE INV TRUST A17U.SI

Ascendas REIT - Proposed acquisition of Science Park Drive Property

  • Ascendas REIT (A-REIT) has proposed to acquire the leasehold interest in the property located at 12, 14 and 16 Science Park Drive from its sponsor. 
  • The property comprises three built-to-suit Science Park buildings held under a single land title. Two of the buildings are leased to DSO National Laboratories, Singapore’s national defence research & development organisation, while the third building is leased to DNV GL Singapore Pte Ltd, a Norwegian risk management company, for its South East Asia regional headquarters. 
  • The purchase consideration of S$420m comes in below the two independent valuations of S$428.8m and S$430.0m. 
  • Including acquisition fees, stamp duties and other professional fees, the total acquisition cost is estimated to be S$437.5m. Of this, the acquisition fee (S$4.2m) would be funded by the issue of units, S$100m would be satisfied by the issue of consideration units to the vendor and the balance would likely be debt funded. 
  • We are positive on this transaction as the acquisition would boost A-REIT’s portfolio WALE to 4.4 years from 3.7 years and the leases also have weighted built-in rental escalations of 2.2% to 2.5% per annum. 
  • The property is expected to generate a NPI yield of approximately 6.3% (before acquisition costs) and 6.0% (post-acquisition costs) in the first year of ownership. 
  • Maintain BUY and S$2.67 fair value estimate on A-REIT.




Wong Teck Ching Andy CFA OCBC Investment | http://www.ocbcresearch.com/ 2016-12-06
OCBC Investment SGX Stock Analyst Report BUY Maintain BUY 2.670 Same 2.670






MOST TALKED ABOUT STOCKS / REITS OF THE WEEK



loading.......


Analysts Say...


loading.......



Advertisement