Singapore-listed office REIT, Keppel REIT (SGX:K71U), announced on 17 January that it will be divesting a freehold Grade A office property in Sydney, Australia for AUD160 million (SGD160 million).
The property, 77 King Street, will be sold to a wholly-owned subsidiary of Invesco Asia Core Fund known as ARE Noble Pty Ltd. The sale is said to result in a divestment gain of approximately AUD28 million for Keppel REIT.
77 King Street is located in Sydney’s central business district and offers approximately 147,000 square feet of net lettable area over 18 levels of offices and two basement levels of retail space.
"The strategic divestment of 77 King Street is in line with our commitment to maximise and capture value for unitholders, while providing Keppel REIT with greater financial flexibility”, said Ng Hsueh Ling, CEO of Keppel REIT’s manager The divestment is expected to be completed in the first quarter of 2016.
Following the divestment, Keppel REIT will have a portfolio of four office assets in Australia comprising 50% interests in 8 Chifley Square in Sydney, 275 George Street in Brisbane, the office tower and annexe at the Old Treasury Building site in Perth, 8 Exhibition Street and its two retail units, as well as a 100% interest in its three adjoining retail units in Melbourne.
Weighted average lease expiry (WALE) of Keppel REIT’s Australian portfolio will be approximately 10 years, with an average age of 5 years after the divestment.
Units of Keppel REIT are currently listed on the Singapore Exchange at SGD0.895.