Singapore-listed business park and industrial property landlord, Viva Industrial Trust (SGX:T8B), has completed the acquisition of two properties located at 19 Tai Seng Avenue and 11 Ubi Road 1 for SGD122.7 million

The REIT first announced in July 2015 that it was in the process of acquiring the properties for SGD42 million and SGD80.7 million respectively.

According to the REIT, the induction has increased gross floor area of Viva Industrial Trust’s portfolio by over 370,000 square feet to approximately 3.29 million square feet and raise portfolio value by about 14% to approximately SGD1.1 billion.

“The two properties not only diversify the asset and tenant base of Viva Industrial Trust’s portfolio and reduce the concentration of our top 10 tenants, but also increase our weighted average portfolio occupancy from 80.8% to 84.0%”, said Wilson Ang, CEO of the trust’s REIT component’s manager.

“Furthermore, the weighted average lease expiry [WALE] by rental income is expected to increase from 3.1 years to 4.0 years, providing good cash flow visibility”, he added.

The acquisitions are funded by a combination of a SGD73.0 million five-year term loan facility granted by Hong Leong Finance Limited and the proceeds from the private placement of 52,047,200 new units which was launched and closed on 18 November 2015.

Following the properties’ induction int the trust’s portfolio, the Tai Seng Property will be leased back to Home-Fix D.I.Y. Pte Ltd for a term of 10 years under a master lease while the Ubi Property will be partially leased back to Meiban Investment Pte Ltd for a term of 10 years.

Both lease agreements carry an annual rental escalation of 1.5% from the beginning of the third year onwards, said the trust.

Units of Viva Industrial Trust last changed hands at SGD0.715 on the Singapore Exchange.