Singapore-listed hospitality REIT, Ascott Residence Trust (SGX:A68U), announced on 3 September that it will be divesting six rental housing properties in Japan for JPY4,475 million (SGD52.6 million).

The properties will be divested through its wholly-owned subsidiary, ARC-CapitaLand Three Tokutei Mokuteki Kaisha and sold to Japanese real estate firm Samty Co. Ltd.

Ascott Residence Trust has described the divestment as being in line with the REIT’s strategy of unlocking properties with limited growth and re-deploying proceeds in higher yielding assets.

“Moreover, the properties are more than 10 years old and are located in regional cities of Japan where there is limited potential upside”, said Ascott REIT. “Given the current strong investor demand for rental housing properties, it is an opportune time for Ascott REIT to divest these properties at an attractive price”, it added.

Samty Co. has paid an amount equivalent to 5% of the sale price as deposit and will pay the balance on completion which is expected to take place in the third quarter of 2015.

Units of Ascott Residence Trust edged up 1.67% at the end of the trading day on the Singapore Exchange to finish at SGD1.22.

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.