ESR-LOGOS REIT is divesting a complex of three interconnected general industrial buildings in the Berkeley Vale industrial area of New South Wales, Australia.

The freehold property, which has a gross floor area of 27,762 square metres, is being divested for SGD53.4 million.

The sale consideration represents a 18.5% premium to the fair value of the asset, and is 61.8% above its purchase price of SGD33.0 million.

“In line with our capital recycling efforts to focus on modern and in-demand new economy assets, this divestment dovetails with our commitment to pursue value opportunities with potentially higher total returns” said Adrian Chui, CEO of ESR-LOGOS REIT’s manager.

“Divesting this property at a premium to fair value is illustrative of our portfolio recalibration strategy to unlock value from non-core properties”, he added.

The divestment is not expected to have a material impact on ESR-LOGOS REIT’s net asset value and distribution per unit for the financial year ending 31 December 2022.

The net proceeds from the divestment will be deployed to repay outstanding borrowings, finance upcoming asset enhancements and fund general working capital requirements.

Following the divestment, ESR-LOGOS REIT’s portfolio will consist of 83 properties located across Singapore and Australia with a total gross floor area of approximately 2.4 million square metres.

The divestment is expected to be completed in 3Q 2022.

Related: New ESR-LOGOS REIT to focus on 3 asset types across Asia-Pacific in ‘new economy’

ESR-LOGOS REIT was last done on the Singapore Exchange at SGD0.395, which presently implies a distribution yield of 7.32% according to data on the Singapore REITs table.

By Shariffa Al-Habshee

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