Show me the money: Keppel Land sells off Equity Plaza for $550m

Find out why the prime office building had to go.

Keppel Land’s 22-year-old Equity Plaza is about to say hi to new owners. The 28-floor office tower has been sold for a cash consideration of $550m, Keppel Land and Equity (CP) Private Limited announced yesterday.

In a bid to get its capital flowing, the tower has been sold to Plaza Ventures Ltd. The company is part of a consortium led by GSH Corporation Limited.

According to Keppel Land, “The transaction is expected to be completed by the third quarter of 2014. When completed, it is expected to result in a divestment gain of approximately $59.5 million and net proceeds of approximately $195.3 million to Keppel Land. On a pro forma basis, had the transaction been effected on 31 December 2013, Keppel Land Group's net tangible asset per share would have increased from $4.52 to $4.56.”

Here’s more from Keppel Land:

Keppel Land and Equity (CP) Private Limited hold approximately 65% and 35% interests in Equity Plaza respectively. Equity (CP) Private Limited is held by Alpha Core-Plus Real Estate Fund, a fund managed by Keppel Land's property fund management arm, Alpha Investment Partners Limited.

Plaza Ventures Pte. Ltd.'s shareholders are GSH Properties Pte. Ltd., TYJ Group Pte. Ltd., and Vibrant DB2 Pte. Ltd.

Said Mr Ang Wee Gee, Chief Executive Officer of Keppel Land,The 28-storey prime office building has a net lettable area of 252,135 sf with a committed occupancy of about 97%. Located in the heart of Raffles Place, Equity Plaza is within a two-minute walk to the Raffles Place MRT Interchange station and is in close proximity to landmark office developments such as Republic Plaza and Ocean Financial Centre. Equity Plaza underwent major refurbishment works in 2009 and improvement works have been carried out progressively to increase the building's efficiency. The property has a leasehold tenure of 99 years commencing from 7 December 1989.