AIMS APAC REIT has secured a ten-year master tenant on a triple net lease basis for its property at 3 Tuas Avenue 2.

The property is currently under redevelopment and was originally slated for completion in 2H 2019.

As part of this redevelopment, the property is being enhanced into a ramp-up industrial facility suitable for production and storage.

However, the redevelopment is now expected to be completed in the first half of 2020 to cater for the master tenant’s operational requirements, the REIT announced on 18 July,

The redesigning of the property’s base-build for the master tenant will not have a material impact on the overall redevelopment cost of the property, the REIT added.

The master tenant is a global medical device company with headquarters in USA, and will occupy the entire premises of approximately 268,000 square feet upon completion.

The master lease features rental escalations every two years during the initial term, and options to renew the lease for up to a further 20 years after the expiry of the initial ten-year term.

The project development cost is estimated to be SGD48.2 million and the property’s value on an “as-if-completed” basis is circa SGD51.8 million.

The property is expected to provide an approximate initial net property income yield of 7.3%.

AIMS APAC REIT was last done on the Singapore Exchange at SGD1.46, and is currently giving a yield of 7.02% according to the Singapore REITs fundamentals table.

By Shariffa Al-Habshee

Shariffa joined REITsWeek in 2017, and monitors Asia-Pacific REITs for the publication.