FLCT acquires Australian and UK properties for $89.9m

It also sold the remaining 50% of its ownership in a property in Queensland for $150.5m.

Frasers Logistics & Commercial Trust (FLCT) has announced the proposed acquisitions of a logistics property in Victoria, Australia and the 100% of the issued share capital of Maxis Business Park Limited in the UK for $89.9m, a press release revealed.

The total purchase consideration comprised an asset purchase consideration of $22.2m (A$22.5m) for the logistics property in Victoria and $67.7m (£37.7m) for Maxis Business Park located at Bracknell, Thames Valley in the UK.

The aggregate purchase consideration for the proposed acquisitions was negotiated on a
willing-buyer and willing-seller basis and supported by independent valuations.

The Australian property is a freehold logistics property with a gross lettable area of approximately 14,263 sqm and located in the south east of Melbourne’s CBD within the established Braeside Industrial Estate. The Australian Property has a long weighted average lease to expiry (WALE) of approximately 4.9 years as at 30 June and is fully leased to IVE Group with a fixed annual rent increment of 3%.

Meanwhile, the business park in the UK comprises two office buildings with a net lettable area of approximately 17,859 sqm. As at 30 June, the UK Property is 100% occupied with a weighted average lease to break (WALB) of approximately 3.2 years and a WALE of 6.7 years. The UK Property serves as the regional headquarters of several tenants, including Panasonic UK, Allegis Group and Cadence Design Systems.

Separately, the REIT manager also announced the proposed sale of the remaining 50% of its ownership in the property at 99 Sandstone Place, Parkinson, Queensland, Australia to the existing co-owner DWS, a global real estate investment manager.

The sale consideration was at $150.5m, representing a 12.2% premium over the book value of $134.2m (A$135.9 m) as at 30 June and a 31% premium over the original purchase price of $114.9m (A$116.4m) during FLCT’s initial public offering in 2016.

The sale consideration also took into account the latest independent valuation of the sale property conducted by Urbis Valuations of $150.1m (A$152m) as at 31 July.

Following the acquisitions and the divestment, FLCT’s portfolio will comprise 100 properties with a total lettable area of approximately 2.6 million sqm and a portfolio value of approximately $6b.

The estimated net sale proceeds from the proposed divestment are approximately $142.2m (A$144m), after taking into account the divestment fee of approximately $0.7m to be paid to the REIT Manager, together with other divestment and tax related expenses. FLCT will use the net divestment proceeds for general corporate purposes and/or reducing existing debt.