Soilbuild REIT sells 72 Loyang Way facility for $34.08m

It blamed prolonged weakness in the offshore sector and JTC’s anchor tenant ruling amongst its reasons for selling.

Soilbuild Business Space real estate investment trust (Soilbuild REIT) sold its property located at 72 Loyang Way to Kim Hock Enterprise for $34.08m, an announcement revealed.

The integrated facility property comprises of two blocks of three-storey and four-storey ancillary offices, two high ceiling single-storey production facilities, a blasting and spray painting chamber, a working dormitory and a jetty with 142 m of sea frontage, Soilbuild REIT highlighted.

It is situated within the Loyang Industrial Estate, approximately 20 km from the city centre, with a total combined net lettable area of 171,293 sqft, and is said to be situated on a number of JTC leasehold estate land titles which collectively expire on 20 March 2038. The remaining tenure is approximately 19 years as of 22 March.

“Due to prolonged weakness in the marine offshore and oil & gas sector coupled with JTC’s anchor tenant ruling which requires the anchor tenant to satisfy JTC’s requirements such as usage, value-added, remuneration per worker, as well as occupying at least 70% of the premises Gross Floor Area (GFA), it was challenging finding a suitable replacement tenant,” they further explained.

Kim Hock Enterprise has reportedly paid an amount equivalent to 5% of the sale consideration as deposit and will pay the balance of the sale consideration on completion of the Proposed Divestment which will take place after fulfilment of the conditions to completion in the Sale and Purchase Agreement.

After taking into account the divestment related expenses, the net proceeds from the proposed sale would be approximately $34.055m, resulting in an estimated net gain of approximately $55,000.