KEPPEL LAND LTD 18 Sep 2014 Keppel REIT strengthens foothold in Singapore's prime financial district with the acquisition of a one-third interest in Marina Bay Financial Centre Tower 3 Keppel REIT Management Limited, as the Manager of Keppel REIT ("Keppel REIT"), is pleased to announce that Keppel REIT has entered into a conditional share purchase agreement with Bayfront Development Pte. Ltd., a wholly-owned subsidiary of Keppel Land Limited, to acquire a one-third interest in the two-year-old Marina Bay Financial Centre Tower 3 ("MBFC Tower 3") at an agreed value of S$1,248.0 million or S$2,790 psf. Excluding the five-year rental support of up to an aggregate amount of approximately S$49.2 million, the net purchase price will be S$1,198.8 million or S$2,680 psf. The agreed value for MBFC Tower 3 is negotiated on a willing-buyer willing-seller basis and is supported by the independent valuations by Cushman & Wakefield VHS Pte Ltd ("Cushman") and Savills Valuation and Professional Services (S) Pte Ltd ("Savills"). The independent valuations for MBFC Tower 3 by Cushman and Savills as at 18 August 2014 are at S$1,281.0 million and S$1,276.0 million respectively. Strategically located in the heart of Marina Bay, the new downtown core of Singapore's Central Business District, the 46-storey MBFC Tower 3 has a total net lettable area ("NLA") of 1,341,980 sq ft, of which the office component is approximately 1.3 million sq ft and the remaining is ancillary retail space. MBFC Tower 3's committed occupancy was approximately 94% as at 31 August 2014. Its stellar line-up of office tenants includes DBS Bank, WongPartnership, Rio Tinto, Booking.com, McGraw-Hill, Mead Johnson and Lego. Ms Ng Hsueh Ling, Chief Executive Officer of the Manager, said, "Singapore, supported by positive economic fundamentals, continues to be a sought-after destination for businesses and multinational corporations seeking to deepen and expand their presence in the fast-growing Asian region. "MBFC Tower 3, with its excellent location and premium office building specifications, will be a strategic addition to Keppel REIT's portfolio. The acquisition of MBFC Tower 3 and the divestment of Prudential Tower will enhance and transform Keppel REIT's portfolio in terms of age and quality of assets, as well as improve the portfolio property fundamentals to ensure long-term sustainable income to Unitholders." The Manager believes that the accretive(1) acquisition will be beneficial to Unitholders of Keppel REIT. The acquisition, which is consistent with Keppel REIT's investment and growth strategy, will:
The Manager intends to fund the acquisition of the two-year-old MBFC Tower 3 with (i) part payment by way of issuing Keppel REIT Units to Keppel Land(4), (ii) net proceeds from the placement of 195,000,000 new Units(5), (iii) part of the sales proceeds from the divestment of the 16-year old Prudential Tower(6), and (iv) additional borrowings. Post-acquisition, Keppel REIT is expected to have an aggregate leverage ratio of approximately 43.8%(7). Following the completion of the divestment of Prudential Tower and acquisition of MBFC Tower 3, Keppel REIT's assets under management will be over S$8.1 billion. Approximately 93% of Keppel REIT's Singapore portfolio will be located within the prime Raffles Place and Marina Bay financial precincts. The acquisition, consideration Units to be issued to Keppel Land as well as the whitewash resolution are subject to the approval of Unitholders of Keppel REIT at an extraordinary general meeting. Please refer to the Manager's SGX announcements for more details. About Marina Bay Financial Centre Tower 3 Designed by world-renowned New York-based architect Kohn Pedersen Fox Associates, MBFC Tower 3 is a newly completed premium Grade A office building with large column-free and symmetrical floor plates of approximately 30,000 sq ft to 45,000 sq ft which optimise the efficient use of space as well as offer panoramic views of the Marina Bay. Located in the heart of prime waterfront land in Singapore's financial district, MBFC Tower 3 is a 46-storey commercial building with a total NLA of 1,341,980 sq ft, of which the office component is approximately 1.3 million sq ft and the remaining is ancillary retail space. MBFC Tower 3 is part of the Marina Bay Financial Centre integrated development ("MBFC Development") which comprises three office towers; two residential developments, Marina Bay Residences and Marina Bay Suites; and a subterranean retail mall, Marina Bay Link Mall. The MBFC Development is connected to the other developments in the Marina Bay precinct and the Raffles Place MRT interchange and the Downtown MRT stations via an underground pedestrian network. Positioned as Asia's Best Business AddressTM, the MBFC Development is in close proximity to a wide range of Singapore landmarks including the Marina Bay Sands integrated resort, Gardens by the Bay, Esplanade - Theatres on the Bay, international and boutique hotels, luxury residences as well as a range of dining and retail options. MBFC Tower 3: Key Property Information
(1) On a pro forma basis for the financial year ended 31 December 2013, distribution per Unit will accrete from 7.88 cents to 7.89 cents. This has assumed that Prudential Tower is divested and part of the sales proceeds is used to partially finance the acquisition of the one-third interest in MBFC Tower 3.
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About Keppel REIT (http://www.keppelreit.com) Listed by way of an introduction on 28 April 2006, K-REIT Asia was renamed Keppel REIT on 15 October 2012. Keppel REIT is one of the largest real estate investment trusts listed on the Singapore Exchange Securities Trading Limited. Keppel REIT's objective is to generate sustainable income and long-term growth for Unitholders by owning and investing in a portfolio of quality income-producing commercial real estate and real estate-related assets pan-Asia. As at 31 August 2014, Keppel REIT has an asset size of approximately S$7.4 billion comprising 10 premium commercial assets strategically located in the central business districts of Singapore, and key cities of Sydney, Melbourne, Brisbane and Perth in Australia. In Singapore, Keppel REIT owns a 99.9% interest in Ocean Financial Centre, a one-third interest in Marina Bay Financial Centre Phase One (comprising office Towers 1 and 2 and Marina Bay Link Mall), a one-third interest in One Raffles Quay, Bugis Junction Towers, and a 92.8% interest in Prudential Tower. On 15 May 2014, Keppel REIT announced the divestment of its 92.8% interest in Prudential Tower. The divestment is expected to be completed on 26 September 2014. In Australia, Keppel REIT owns five commercial assets, which comprises a 50% interest in 8 Chifley Square and the 77 King Street Office Tower in Sydney, a 50% interest in the office building at 8 Exhibition Street in Melbourne, a 50% interest in 275 George Street in Brisbane, as well as a 50% interest in the new office tower to be built on the Old Treasury Building site in Perth. Keppel REIT is sponsored by Keppel Land Limited ("Keppel Land"), one of Asia's leading property developers, and managed by Keppel REIT Management Limited, a wholly-owned subsidiary of Keppel Land.
The value of Units and the income from them may fall as well as rise. Units are not obligations of, deposits in, or guaranteed by the Manager, or any of its affiliates. An investment in Units is subject to investment risks, including the possible loss of the principal amount invested. Investors have no right to request the Manager to redeem their Units while the Units are listed. It is intended that Unitholders of Keppel REIT may only deal in their Units through trading on the SGX-ST. Listing of the Units on the SGX-ST does not guarantee a liquid market for the Units. The past performance of Keppel REIT is not necessarily indicative of the future performance of Keppel REIT. |
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