Sabana REIT ends rent conflict with tenant in 10 Changi South Street

It received $2.15m from the tenant.

Sabana Shari’ah Compliant Industrial Real Estate Investment Trust’s (Sabana REIT) agreed to amend its lease agreement with Adviva Distribution, a tenant of 10 Changi South Street, after a previous termination was caused by the latter’s failure to pay rent and other sums.

Sabana REIT received $2.15m from the tenant, which would be applied towards the settlement of the outstanding rental arrears and late payment charges as at 31 August 2018.

Under the variation of lease, which is subject to JTC Corporation’s approval, there will be no reduction in the fixed rent payable by the Adviva Distribution to Sabana REIT.

“The manager does not expect there will be any material adverse financial impact on Sabana REIT’s distribution per unit (DPU) for the current financial year in relation to the Property,” the company added.

10 Changi South Street contributed around 6.5% to Sabana REIT’s gross revenue for the second quarter, it said in a previous announcement.

Previously, Sabana REIT’s board of directors issued two letters of demand to the tenant on 12 July 2018 and 8 August 2018 after seeking legal advice on the matter. It had also shortlisted and started negotiations with prospective replacement tenants for the property.