First REIT: Aiming to cut Indonesia exposure to less than half of portfolio

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First REIT highlighted that its new growth strategy is aiming to reduce its exposure to Indonesia to less than 50 percent of its portfolio within the next three to five years. 

The REIT, which focuses on hospitals and nursing homes, made the statement in a filing to SGX Friday answering questions from unitholders ahead of its extraordinary general meeting (EGM) seeking approval to acquire 12 nursing homes in Japan

First REIT also said it was planning to seek properties in developed markets, and aims to increase its footprint in Japan.

When asked about the potential pipeline of assets from its sponsor, First REIT said it was too early to comment.

In December, First REIT said it planned to acquire the nursing homes from OUE Lippo Healthcare, its sponsor, for S$163.5 million in cash and units. The deal will boost OUE Lippo Healthcare’s interest in the REIT to 33.2 percent from 15.3 percent. 

The deal will see First REIT’s exposure to properties outside Indonesia rise to 27.1 percent of asset value, from 3.6 percent previously, on a pro forma basis, OUE Lippo Healthcare had said at the time.

The 12 nursing homes are located in four prefectures in Japan: Hokkaido, Kyoto, Nagano, and Nara, and have a total capacity of around 1,451 units.

First REIT’s portfolio has 19 properties, with three in Singapore and the rest in Indonesia. Last year, the REIT divested its sole property in South Korea

The EGM will be held on 28 January.