Lendlease Global Commercial REIT launches S$574M equity fundraising

The Jem property in Singapore. Lendlease Global Commercial REIT entered a deal in February 2022 to acquire the remainder of the Jem property it didn't already own. Credit: Lendlease Global Commercial REITThe Jem property in Singapore. Lendlease Global Commercial REIT entered a deal in February 2022 to acquire the remainder of the Jem property it didn't already own. Credit: Lendlease Global Commercial REIT

Lendlease Global Commercial REIT (LREIT) has launched an equity fundraising of at least S$573.8 million via a private placement and a preferential offering, the REIT said in a filing to SGX Tuesday. 

The proceeds will be used to partially finance the acquisition of the portion of the Jem property in Singapore which LREIT doesn’t already own, the filing said. In mid-February, LREIT entered a deal to acquire 68.2 percent of Jem for S$2.08 billion

Private placement

The private placement will be up to 448.3 million new units priced at S$0.7250 to S$0.74 each to raise around S$325 million, subject to an upsize option of around 103.4 million additional new units to raise up to an additional around S$75 million, the REIT said.

The issue price of the private placement units is at a discount of around 7.1 percent to 9.0 percent to the volume weighted average price (VWAP) of S$0.7964 for trades on 21 March, the REIT said. 

The private placement pricing will be determined in a book-building process, the filing said.

Preferential offering

The preferential offering of 345.58 million new units to existing unitholders, which will be on the basis of 29 new units for every 100 existing units, is priced at S$0.72 each to raise around S$248.8 million, the REIT said. 

The preferential offering price is a discount of around 9.6 percent to the VWAP on 21 March, the filing said.

LREIT’s sponsor, Lendlease Corp., which holds an interest in 316.17 million units, or a 26.53 percent stake, has agreed to take up its total allotment of the preferential offering units and will make applications for any excess units which are unsubscribed up to a total amount of S$117.8 million, the filing said.

Advanced distribution

In connection with the private placement, LREIT’s manager plans to declare an advanced distribution to existing unitholders estimated at 1.0 Singapore cent to 1.2 Singapore cents, the filing said. The record date for the advanced distribution is expected to be 30 March. 

The new private placement units are expected to be issued on or around 31 March, and the advanced distribution will be for amounts accrued by the REIT up to the day immediately proceeding the issue date, the filing said.

Citigroup Global Markets Singapore, DBS Bank, OCBC and UOB are the joint bookrunners for the equity fundraising, the filing said.

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