Ascendas Hospitality Trust terminated its deal to acquire the under-development serviced apartment component of a mixed-use development in Melbourne, Australia, from UEM Sunrise, the trust said in a filing to SGX Friday.
“As a result of certain issues relating to the specifications and the condition of the property, which the purchaser and vendor have not been able to resolve despite their best efforts and negotiations, the purchaser and the vendor have mutually agreed to terminate the acquisition,” Ascendas Hospitality Trust said in the statement.
In 2015, the trust had agreed to acquire the serviced apartment component, which was expected to have 252 units, located on levels 10 to 32 of Aurora Melbourne Central, as well as common facilities for guests on level nine and a ground-floor restaurant for A$120 million.
Aurora Melbourne Central, located at 224-225 La Trobe Street, was Malaysian developer UEM Sunrise’s first project in Australia, and it was expected to be completed this year. The project was expected to be 92 storeys tall.
On Friday, Ascendas Hospitality Trust said its A$5 million deposit would be returned, minus an agreed sum to cover expenses.
The deal’s termination isn’t expected to have any material negative impact on net property income or distribution per stapled security for the current financial year, nor is it expected to impact the proposed merger of Ascendas Hospitality Trust and Ascott Residence Trust, the filing said.
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