CapitaLand China Retail Trust has entered into a sale and purchase agreement to acquire a shopping mall in Chengdu for RMB1,500 million (SGD305 million).
The property, currently known as Galleria, Chengdu, has been valued at RMB1,520 million (SGD309 million) by Savills Valuation & Professional Services as at 26 July 2016. Including acquisition related expenses, the acquisition will cost RMB1,527 million (SGD310.4 million).
The six-storey mall has a current net property income (NPI) yield of about 5.4% and the acquisition is expected to be distribution per unit (DPU) accretive, said the Singapore-listed retail REIT in a statement on 19 August.
The property features a net lettable area (NLA) of 34,736 square metres is 100% occupied with 167 leases including anchor tenants Golden Harvest, H&M, Nike, Starbucks, Swarovski, and UNIQLO.
CapitaLand China Retail Trust will fund the acquisition via a combination of existing cash and additional debt. Post-acquisition, the REIT’s gearing ratio is expected to increase to about 37%. The acquisition is expected to be completed by the end of 2016.
Units of CapitaLand China Retail Trust last traded on the Singapore Exchange at SGD1.60.