Sasseur REIT buys additional Hefei Outlet shop units for $19.8m

The acquisition is said to be its first since its IPO.

Sasseur Real Estate Investment Trust (Sasseur REIT) has signed the sale & purchase agreements to acquire additional shop units with existing tenancies at the annex block of Sasseur (Hefei) Outlets from third-party vendors for a purchase consideration of approximately $19.8m (RMB98.3m), an announcement revealed.

The shop units acquired comprise a gross floor area (GFA) of 6,133.84 sqm and an occupancy rate of 100% as at 24 April. They also have a weighted average lease expiry (WALE) of 5.4 years, and its tenants include fashion brands, an indoor zoo, children’s entertainment facilities and food and beverage outlets.

The acquisition will increase Sasseur REIT’s ownership of the Hefei Outlets from 77.8% to 81.2% by GFA. According to the firm, the acquisition will be funded fully by existing cash and is expected to increase the REIT's distribution per unit (DPU) and net asset value (NAV) per unit from 5.128 cents and 90.33 cents to 5.179 cents and 90.37 cents, respectively.

The Hefei Outlets, which commenced operation in May 2016, is located in the High-Tech Industrial Development Zone.The outlets reportedly demonstrated strong operating performance, having outperformed its forecast since Sasseur REIT’s initial public offering (IPO) in 2018. Its YoY sales growth for FY 2018 showed an improvement of 53.9%, whilst actual FY 2018 sales outperformed its FY 2018 forecast by 9.6%.

The completion of the acquisition is expected to take place within 60 working days after the execution of the sale & purchase agreements.