ESR-Reit launches private placement to raise $150m

It will be used to fund the acquisition of Singapore and Australian assets.

ESR-Reit is looking to raise $150m to fund acquisition of Singapore and Australian assets via private placements and preferential offering.

In a recent announcement, ESR-Reit said it will acquire the Tanjong Penjuru logistics facility for $119.6m as well as 10% of the total issued units of ESR Australia Logistics Partnership for a purchase consideration of $62.4m (A$60.5m).

The company will also acquire the asset enhancement initiatives for two high-specification properties, being 16 Tai Seng Avenue and 7000 Ang Mo Kio Avenue 5.

46A Tanjong Penjuru is a five-storey modern ramp-up logistics facility with mezzanine offices on each floor. Located in the western central area of Singapore within a mature industrial estate of Tanjong Penjuru and well-served by major expressways, the property is strategically located and is well sought after due to its close proximity to the Central Business District, Jurong Port, Tuas Megaport and key container yards. Fully committed with six tenants, the multi-tenanted property has a land lease tenure of approximately 29 years and a GFA of approximately 523,689 sqft.

Meanwhile, the ESR Australia Logistics Partnership, comprises properties in five Australia states, namely, New South Wales, Victoria, Queensland, South Australia and Western Australia. These have a total land area of about 1.3 million square metres, an occupancy rate of 95.9 per cent and a weighted average lease expiry of 4.87 years as at March 31.

“The Singapore Acquisition will enhance our ability to tap into the rising demand for quality logistics facilities. Likewise, the Australia Acquisition marks the first step for ESR-REIT’s overseas diversification across key regional markets. We are pleased to have this unique opportunity to make a strategic investment in Australia by leveraging our Sponsor’s network of quality pipeline opportunities to accelerate our growth trajectory overseas. The Australia Acquisition will strengthen ESR-REIT’s portfolio geographically, provide us with access to freehold assets and broaden our exposure in the logistics segment,” chief executive officer and executive director of ESR-REIT’s manager, ESR Funds Management (S) Limited, Adrian Chui said.