Industrial property landlord AIMS AMP Capital Industrial REIT (SGX:O5RU) will make its first acquisition in Australia. The REIT has entered into a conditional agreement with an Australian managed fund, Stockland Direct Office Trust No. 2, to acquire a 49 per cent indirect interest in the Optus Centre for A$184.425 million.

AIMS AMP Capital Industrial Trust's portfolio is industrial property-heavy. But with the acquisition it could be diversifying into offices. 

Optus Centre is 100 per cent leased to Optus Administration Pty Limited, a wholly-owned subsidiary of SingTel Optus, the second largest telecommunications company in Australia. Singtel Optus is a wholly owned subsidiary of telecommunications group, SingTel.

The property has a weighted average lease term of 8.62 years with fixed annual escalation of three per cent. This will increase the weighted average lease expiry of the REIT to 4.0 years from 3.0 years as at 30 September 2013 on a pro forma basis.

The Manager’s Chief Executive Officer, Mr Nicholas McGrath said: “This investment enables the Trust to acquire a premium asset which is accretive to the Trust, provides long-term cashflow certainty, strengthens our asset base and diversifies our portfolio with the addition of a premium business park office campus leased to Optus”.

Distribution Per Unit (DPU) and Distribution Yield will increase by 5.7 per cent and 5.6 per cent respectively on a pro forma basis. In addition, Net Property Income (NPI) yield will increase to 6.64 per cent from 6.3 per cent on a pro forma basis,” Mr McGrath added.

Units of AIMS AMP REIT fell 1.64 per cent at the close of the trading day to end at S$1.50 on the Singapore Exchange.

By Ridzwan Rahmat

Ridzwan has been analysing REITs and business trusts since 2008, and personally manages a portfolio comprising mainly of SGX-listed REITs. He founded REITsWeek in 2013.