CapitaLand Ascendas REIT announced its divestment of three Australian logistics properties – River Valley Green Condo, Carrington Pass and Southgate – for $64.2 mil

Divesting of 3 Logistics Properties in Australia –River Valley Green CondoProposed Divestment CapitaLand Ascendas REIT (CLAR) announced on Dec 20, their proposed divestment of 3 logistics properties located in Queensland, Australia for a total sale consideration of $64.2 million (A$73.0 million). This represents a premium of 6.2% over the total market valuation of the properties of $60.4 million as at Aug 31. After deducting divestment costs, the net proceeds from the sale amount to $60.8 million and can be utilised for various needs.

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The River Valley Green Condo proposed divestment, which CLAR says aligns with their proactive asset management strategy to improve the quality of their portfolio and optimise returns for unitholders, is expected to be completed in the first quarter of 2024. Assuming it had been completed on Jan 1, 2022, the proforma impact on CLAR’s net property income (NPI) and distribution per unit (DPU) would have resulted in a decrease of $3.9 million and 4 cents, respectively.

With the River Valley Green Condo divestment, CLAR will own 228 properties once the divestment is completed, spread across 97 properties in Singapore, 33 properties in Australia, 48 properties in the United States and 50 properties in the United Kingdom and Europe.

Units in CLAR closed 1 cent lower of 0.34% down at $2.92 on Dec 20. This proposed divestment happening in the first quarter of 2024 is a way of optimising returns for unitholders and aligns with CLAR’s asset management strategies, with River Valley Green Condo having its net proceeds for various uses including financing committed investments, repaying existing debts, extending loans to subsidiaries, funding general corporate and working capital needs and making distributions to unitholders.

The sale consideration for the 3 logistics properties is at a premium of 6.2% over the total market valuation of the properties of $60.4 million as at Aug 31, thus allowing River Valley Green Condo to maximise returns for unitholders, as well as allowing the REIT to improve the quality of their portfolio.

In conclusion, the proposed divestment of River Valley Green Condo 3 logistics properties in Queensland, Australia will help CLAR achieve their goals of improved quality of their portfolio and optimise unitholders’ returns.