Starhill Global REIT property, Roppongi Terzo, was divested for SGD29.9 million on 7 January 2016.Starhill Global REIT property, Roppongi Terzo, was divested for SGD29.9 million on 7 January 2016.

Singapore-listed office and retail REIT, Starhill Global REIT (SGX:P40U), announced on 7 January that it has completed the divestment of a property in Roppongi, Tokyo for JPY2,500.0 million (SGD29.9) million.

The five-storey property, known as Roppongi Terzo, is located in Minato-ward of Tokyo and tenanted mainly by food & beverage and entertainment establishments.

The property was last valued at JPY2,440.02 million (SGD29.2 million), and accounts for 32.8% of the Japan portfolio and 0.9% of Starhill Global REIT’s portfolio by asset value. The sale consideration of JPY2,500.0 million translates to a yield of 4.4%, according to the REIT.

“This divestment marks the third divestment in Japan in the last three years and is part of our ongoing strategy to streamline our overall portfolio and focus on our strengths”, said Ho Sing, CEO of the Starhill Global REIT’s manager.

“During this period, we have added two new strategic properties in the prime districts of Perth and Adelaide in Australia for approximately AUD336 million. Going forward, we will continue to sharpen and improve the quality of our portfolio through divestments, acquisitions and asset enhancement initiatives”, added Ho.

Following the divestment, Starhill Global REIT’s portfolio in Japan has reduced to four properties and the exposure to Japan by asset value has also diminished from 2.9% to approximately 2.0%.

Gearing is expected to decrease from 35.7% to 35.1% assuming that the net sales proceeds are substantially used to repay the Yen loans, the REIT said in its statement.

Units of Starhill Global REIT are currently listed on the Singapore Exchange at SGD0.74, down 3.2% from its previous close.

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.