A property in the initial portfolio of Prime US REIT. (Photo: Prime US REIT)A property in the initial portfolio of Prime US REIT. (Photo: Prime US REIT)

KBS US Prime Property Management has registered the final prospectus for Prime US REIT with the Monetary Authority of Singapore (MAS), making it the largest initial public offering (IPO) in Singapore in the year-to-date.

Applications for the IPO open at 9.00 pm on 8 July 2019, and closes 12.00 noon on 15 July 2019.

Trading of the units in Prime US REIT on the main board of the Singapore Exchange is expected to commence at 2.00 pm on 19 July 2019.

Based on the IPO price of USD0.88 per unit (SGD1.20 for Singapore offer), Prime US REIT promises a distribution yield of 7.4% in FY2019, and 7.6% in projection year 2020, representing a distribution yield growth of 3.1%.

Prime US REIT has an initial portfolio of 11 grade A office properties, with a total appraised value of USD1.2 billion.

98.3% of the REIT’s leases have built-in escalation clauses of between 1.0% and 3.0% annually, and 96.9% of its leases leases are on triple-net or modified and full service gross basis.

The properties are located in nine key office markets across the US - namely, San Francisco Bay Area, Salt Lake City, Denver, St Louis, Dallas, San Antonio, Philadelphia, Washington D.C., and Atlanta - and have an aggregate net lettable area (NLA) of 3.4 million square feet.

The IPO portfolio has an occupancy rate of 96.7%, with a well- diversified base of over 180 tenants across diverse trade sectors including financial, legal, real estate, technology and information services.

The IPO portfolio also has a weighted average lease expiry (WALE) of 5.5 years based on NLA, with its top 10 tenants’s WALE at 6.7 years.

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By Shariffa Al-Habshee

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