FCT divests 10 strata lots at Yishun 10 to Frasers Property for $34.5 mil
Frasers Property currently possesses the just other property at Yishun 10, that is the 1,477-seat Golden Village cineplex in Yishun. The firm got it from Golden Village Multiplex Pte Ltd on Aug 8 for $48 million.
That said, 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 supervisor, owns a 37.94% stake in FCT. FCT’s manager is in addition a wholly-owned subsidiary of Frasers Property Limited, wherein the latter is considered as a “managing shareholder” of the manager.
Considered that the net asset value (NAV) of the 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.
Upon the finalization of the most recent recommended purchase, Frasers Property will conclude full possession of Yishun 10 and proceedings at Yishun 10 will continue customarily.
According to Frasers Property, the proceeding was made to “optimize capital efficiency with active account management initiatives”. “The suggested deal will possibly permit the group to generate additional worth from the longer-term redevelopment possibility of the asset,” it adds.
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 average of JLL’s evaluation of $34 million and Savills’ valuation of $35 million.
The divestment is not subject 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 short of 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.
The properties, positioned beside Northpoint City, are held under subsidiary strata certifications of title. The lots have a leasehold term of 99 years beginning from April 1, 1990. They were gotten in 2016 and have a complete gross floor area of 966 sqm and overall net lettable area (NLA) of 961 sqm.
Frasers Property, through its wholly-owned subsidiary, Lion (Singapore), entered into a sale and purchase contract (SPA) with FCT’s trustee, HSBC Institutional Trust Services (Singapore) Limited, on Aug 25.
Frasers Centrepoint Trust (FCT) has divested 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.
According to FCT, the divestment remains in line with the supervisor’s proactive portfolio management strategy to optimize portfolio structure and its returns. The manager claims it intends to make use of the net earnings of $33.8 million to pay off “certain debt”, that will minimize FCT’s aggregate leverage. The net amount accounts for many others divestment associated expenditures of roughly $0.2 million and transfer of tenants’ down payment of approximately $0.5 million.
