Singapore-based real estate developer CapitaLand has agreed to acquire a prime freehold business park in the United Kingdom for 129.3 million pounds ($168 million), boosting its Europe portfolio to about $6.2 billion.
In a disclosure to the Singapore Exchange Wednesday, CapitaLand said it will acquire Arlington Business Park in Reading, over 60 km west of London. The business park comprises 11 Grade A office buildings totalling about 367,000 square feet of net lettable area.
Arlington Business Park sits on six hectares of land, with amenities including a cafe, gymnasium, and a floating pavilion built on a scenic lake where meetings, events, and conferences can be held. Notable tenants include Amazon, Clearswift, NTT Group, Regus, Veritas, Willis Towers Watson, and Honda.
The acquisition of Arlington Business Park is part of CapitaLand’s plan to increase its investments in developed markets such as Europe, Japan, and the USA, according to Jason Leow, CapitaLand’s President, Singapore & International.
“Our strengthened presence in Europe will enable the Group to maintain a balanced portfolio between emerging and developed markets,” he added.
In Europe, CapitaLand currently owns and operates more than 70 properties across the office, logistics, and lodging sectors. These assets are located predominantly in the developed markets of France, Germany, and the UK.
In the UK, through CapitaLand’s wholly-owned lodging business unit, The Ascott Limited and its hospitality trust, Ascott Residence Trust, the group owns and manages eight properties with over 1,330 units in London and Liverpool.
Gerald Yong, Chief Executive Officer of CapitaLand International, said the acquisition is timely as general business sentiment has improved, with increased clarity post Brexit.
“The UK offers strong fundamentals such as a resilient economy and transparency, and we look forward to expanding our presence in the UK and Europe,” Yong said.
In the fiscal year 2019, CapitaLand said it has achieved a total profit after tax and minority interests (PATMI) of S$2.1 billion ($1.5 billion), up 21.1 per cent from a year earlier.
CapitaLand Group CEO Lee Chee Koon said that while the sudden outbreak of COVID-19 has affected the group’s businesses and those of its partners and tenants, the group remains positive on the long-term fundamentals for Singapore and China.