Lendlease REIT to acquire the remaining interest in Jem for $2.079b
This will result in the REIT owning a direct 100% stake in the property.
Lendlease Global Commercial REIT (LREIT) has proposed to acquire the remaining interest in Jem for $2.079b, a 0.3% or $7m discount to the appraised value.
Including acquisition-related expenses, the total acquisition cost is estimated at $2.015b.
The acquisition will be partially funded through the net proceeds from an equity fundraising “which may comprise a private placement of new LREIT units to institutional and other investors and/or a non-renounceable preferential offering of new units to the existing Unitholders on a pro-rata basis”
The balance, meanwhile, will be funded by the LREIT promissory notes issued to one of the property vendors, the issuance of the Consideration Units to Lendlease’s wholly-owned subsidiary LLI, debt financing, and/or issuance of perpetual securities, as well as LREIT’s cash reserves and internal resources.
With the acquisition, the REIT will now own a direct 100% stake in the property.
The acquisition will also enhance the REIT’s total portfolio, with its Net Leasable Area expected to increase by 70.0% to approximately 2.2 million square feet, whilst its weighted average lease expiry is expected to reach 8.9 years.
Given the enlarged portfolio, REIT is also seeing an increase in its financial year 2021 net property income (NPI) to $147.8m, resulting in an NPI yield of 4.2%.
Upon completion of the proposed acquisition, LREIT’s total deposited property is expected to increase by 2.1 times to approximately $3.6b, the REIT’s manager, Lendlease Global Commercial Trust Management Pte. Ltd., said.