Sabana REIT

Sabana REIT: has proposed to acquire the property at 508 Chai Chee Lane, a seven storey light industrial building with two basement storeys. The building has a built up gfa of 327,575 sf. The property is a JTC leasehold estate of 30 + 29 yrs tenure commencing from Apr ’01. Land area of the site is around 113,690 sf with a remaining tenure of ~46.5 yrs (compared with Sabana’s existing portfolio of ~38.8 yrs). The total cost of acquisition of $68.2m compares with the property’s independent valuation of $67.75m. Post sale, the vendor will lease back at least 50% of the total rentable area of the property, for a term of 10 yrs with two options to renew for further terms of 4 yrs and 3.5 yrs each. The property is currently 100% occupied by the vendor. The deal is subject to JTC approval. Sabana believes it has sufficient financial flexibility and capacity to fund the acquisition, which is expected to take place in 3Q13.