ESR-LOGOS REIT to divest Australia property

Australian notes and coins

ESR-LOGOS REIT (E-LOG) has entered a deal to divest a New South Wales, Australia, property to Australasian Conference Association Ltd. for S$53.4 million (A$55 million), the REIT said in a filing to SGX Wednesday.

The consideration is an 18.5 percent premium to the property’s S$45.1 million fair value and a 61.8 percent premium to its purchase price of S$33 million, E-LOG said. The property, which consists of three interconnected general industrial buildings, is located at 3 Sanitarium Drive, Berkeley Vale, New South Wales, Australia, the filing said.

The net proceeds will be used to repay outstanding borrowings, finance upcoming asset enhancements and/or to fund general working capital requirements, the filing said.

Adrian Chui, CEO and executive director of the REIT’s manager, said the divestment was in line with plans to shift toward focusing on modern New Economy assets.

“Divesting this property at a premium to fair value is illustrative of our portfolio recalibration strategy to unlock value from non-core properties. We will continue to actively review our portfolio to identify attractive opportunities for growth and deliver greater income stability to optimise Unitholders’ returns,” Chui said in the statement.

After the deal is completed — expected in the third quarter of this year — E-LOG’s portfolio will have 83 properties in Singapore and Australia, the filing said.

ESR-LOGOS REIT was created via the combination of ESR-REIT and ARA LOGOS Logistics Trust.