FCT divests 10 strata lots at Yishun 10 to Frasers Property for $34.5 mil
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.
Considered 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 earnings of $97 million, the divestment is classified as a “non-discloseable transaction” under Rule 1008 of the listing guidebook.
Springleaf Residence condominium
The properties, positioned next to Northpoint City, are held under branch strata certifications of title. The lots have a leasehold term of 99 years starting from April 1, 1990. They were acquired in 2016 and have an overall gross flooring area of 966 sqm and complete net lettable area (NLA) of 961 sqm.
According to Frasers Property, the proceeding was made to “optimise capital efficiency via active profile management initiatives”. “The proposed deal will potentially permit the group to generate additional value from the longer-term redevelopment potential of the asset,” it includes.
The divestment is not subject to FCT’s unitholders’ approval as it comprises 1.17% of the net tangible assets (NTA) and NAV of FCT as at Sept 30, 2024, and less than the required 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.
The sale consideration factored in the latest valuations of the real estates 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 agreed property worth is the standard of JLL’s appraisal of $34 million and Savills’ valuation of $35 million.
Frasers Property currently possesses the only other property at Yishun 10, which is the 1,477-seat Golden Village cineplex in Yishun. The firm obtained it from Golden Village Multiplex Pte Ltd on Aug 8 for $48 million.
According to FCT, the divestment remains in line with the supervisor’s proactive portfolio management method to optimize account composition and its revenues. The supervisor claims it means to make use of the net earnings of $33.8 million to pay back “particular debt”, which will decrease FCT’s aggregate leverage. The net total accounts for many others divestment related costs of approximately $0.2 million and transfer of occupants’ security deposits of approximately $0.5 million.
Upon the finalization of the most up to date recommended purchase, Frasers Property will conclude full ownership of Yishun 10 and operations at Yishun 10 will continue as usual.
Frasers Centrepoint Trust (FCT) has divested 10 strata lots in a strata-titled retail development at 51 Yishun Central 1 (additionally known as Yishun 10) to Frasers Property Limited for $34.5 million.
That stated, the divestment is regarded to be an interested person transaction and interested party transaction considered that Frasers Property is the REIT’s sponsor. Frasers Property, through Frasers Property Retail Trust Holdings Pte. Ltd. and FCT’s executive, possesses a 37.94% interest in FCT. FCT’s supervisor is also a wholly-owned subsidiary of Frasers Property Limited, wherein the latter is considered a “controlling shareholder” of the manager.
