Manulife US REIT launches private placement to raise at least US$80M

Manulife US REIT entered a deal to acquire Diablo Technology Park, a five-building collaborative office campus in Tempe, Phoenix, in November 2021. Credit: Manulife US REITManulife US REIT entered a deal to acquire Diablo Technology Park, a five-building collaborative office campus in Tempe, Phoenix, in November 2021. Credit: Manulife US REIT

Manulife US REIT has launched a private placement to sell as many as 154.1 million new units, including an upsize option, at US$0.649 to US$0.676 each to raise at least US$80 million to partially finance the acquisition of three properties in the U.S., the REIT said in a filing to SGX Tuesday.

If the upsize option is exercised, up to 30.8 million new units will be issued to raise additional proceeds of up to US$20 million, the REIT said.

The price range is a discount of 5.1 percent to 8.9 percent to the volume weighted average price (VWAP) of US$0.7124 a unit for trades on Monday, the filing said, adding the issue price will be set after a book-building process.

If the upsize option is exercised, the private placement will increase the number of units issued by 9.6 percent, the filing said.

“The private placement represents a fast and efficient means of raising capital to finance the acquisitions with certainty. It also minimises the exposure of the equity fund raising to the volatility of the market price of the units,” MUST said.

Manulife US REIT entered deals to acquire three U.S. office properties — two near Phoenix, Arizona, and one near Portland, Oregon — for a total of around US$201.6 million, the REIT said in a filing to SGX Tuesday.

Existing unitholders will receive an advanced distribution for the period running from 1 July to the day before the new units are issued, estimated at 2.16 U.S. cents to 2.36 U.S. cents, MUST said.

The payment is expected to be made on or around 17 February 2022, the filing said.

DBS Bank and OCBC Banking Corp. have been appointed the joint lead managers and underwriters for the placement, the filing said.