Singapore-listed stapled security Viva Industrial Trust (VIT) ( SGX:T8B) will be making its maiden acquisition since IPO by purchasing light industrial properties Jackson Square and Jackson Design Hub for SGD111.5 million.
The properties, located in the central Singapore precincts of Toa Payoh and Tai Seng respectively, are said to provide VIT with an initial net property income yield of 10.4% and be yield accretive for unit holders.
The total acquisition costs, which come up to SGD112.8 million after taking into account the various fees related to the transaction, will be raised via a combination of debt and equity financing.
The trust has however not provided any details on what the equity financing would entail.
Jackson Square is a four-block estate with two to six-storey buildings that has a total gross floor area (GFA) of 418,600 sq ft. The property is currently 91% occupied and comes with a five-year rental guarantee from sellers Jackson International that is based on approximate total gross rental collection from current tenants.
Meanwhile Jackson Design Hub is a five-storey building in Tai Seng with a GFA of 85,000 sq ft. The property will be leased back to sellers Jackson Global for a period of ten years under a sale-and-leaseback agreement.
VIT has not provided details on when the acquisition would be completed.
Once the acquisition completes, VIT's average portfolio occupancy will increase from 77.1% to 80.5% while its weighted average lease to expiry (WALE) by rental income will stand at 4 years from the current 3.6 years.
Units of VIT are currently listed on the Singapore Exchange at SGD0.815.