CapitaLand Ascendas REIT

CapitaLand Ascendas REIT Buying The Shugart In one-north For S$218.2m

SINGAPORE – CapitaLand Ascendas REIT (CLAR) is poised to buy The Shugart, a high-specification research and development (R&D) facility in one-north from Seagate Singapore, for S$218.24 million, reported The Business Times on Wednesday afternoon (17 May, SGT).

Overall, the Singapore-listed real estate investment trust (S-REIT) will be paying a total of S$232.4 million, inclusive of all other related fees.

With the purchase of the business space in 26 Ayer Rajah Crescent, it will boost CLAR’s presence in the area. At present, the trust owns five properties in various clusters within one-north with a combined net lettable area (NLA) of 2 million sq ft and assets under management (AUM) of $1.7 billion.

The five assets — Grab’s HQ, Nexus, Galaxis, as well as Neuros & Immunos and Nucleos – provide office space and business space to tech firms, engineering, life sciences, and other emerging sectors. Upon completion of the acquisition, CLAR’s footprint in one-north will rise by 13 percent to an NLA of more than 2.5 million sq ft and AUM of around S$1.9 billion.

On a pro forma basis, the percentage of life sciences premises and business spaces in CLAR’s portfolio will grow to 49 percent (S$8.1 billion) of the trust’s overall investment assets that are collectively valued at S$16.7 billion.

After the conclusion of the deal, Seagate Singapore will sign a 10-year leaseback of the commercial property’s entire gross floor area (GFA), with the option to renew for one decade.

CLAR stated that the proposed transaction conforms with its strategy to invest in assets that cater to the changing market requirements from consumption patterns to structural trends, like e-commerce and digitalisation.

The Shugart, which was constructed about eight years ago, consists of a six-storey podium and a nine-storey building with a cleanroom and data centre space for Seagate Singapore’s business. Apart from functioning as the tech firm’s main R&D location outside the United States, it also comes with a gym, a sky garden, and a multi-purpose sports hall for its staff.

The purchase is expected to be concluded in Q2 2023. Thereafter, CLAR will own 231 investment assets across the globe. These include 98 in Singapore, 49 properties in the UK and Europe, 36 in Australia, and 48 in the United States.

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