FLCT Sells Singapore Mall With Office Space
SINGAPORE – Frasers Logistics & Commercial Trust (FLCT), via its wholly-owned sub-trust Frasers Commercial Trust, has agreed to divest Cross Street Exchange to a third-party for S$810.8 million, according to local bourse filings published on Tuesday morning (25 January, SGT).
Situated at the intersection of South Bridge Road and Cross Street at the fringe of Singapore’s central business district (CBD), the property consists of a 15-storey office building with a retail podium, 2 clusters of heritage shophouses that houses a blend of offices, shops, and restaurants, as well as 4 retail units along 181 South Bridge Road.
Real estate agent Jones Lang LaSalle (JLL), which is advising and managing the sale, revealed that the commercial property comprises 305,739 sq ft of office net leasable area (NLA). In 2019, the asset underwent extensive upgrading works to rejuvenate and reposition the property’s retail podium, which makes up 87,109 sq ft of its NLA.
As 30 September 2021, Cross Street Exchange accounted for about 7 percent of FLCT’s net property income (NPI) and 8.6 percent of the trust’s portfolio value.
The proposed divestment is in line with the FLCT manager’s proactive asset management and portfolio rebalancing strategies, providing opportunities to increase FLCT’s exposure into logistics and industrial assets from 61.1 percent to 66.9 percent.
Post-divestment, FLCT’s portfolio occupancy will rise from 96.2 percent to 97.1 percent, while weighted average lease expiry profile (WALE) shall increase from 4.8 years to 5.0 years.
“The divestment of Cross Street Exchange is transacted at an attractive premium over its book value, re-weighting our portfolio towards logistics and industrial properties. The divestment will enhance our portfolio metrics with a higher overall portfolio occupancy rate and longer WALE and will provide FLCT with significant financial strength and flexibility,” commented Robert Wallace, CEO of FLCT’s manager
The sale of the commercial property is expected to be completed on 31 March 2022.