SG Digest: Manulife US REIT raises $94m; CDL picks stake in IREIT Global

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Singapore’s property and REIT sectors continue to record a spate of deals. Manulife US REIT has raised $94 million in a private placement while City Developments Limited has acquired stakes worth $57 million in IREIT Global Group.

Manulife US REIT raises $94m in private placement

Manulife US REIT has raised $94 million through the issuance of 114.08 million units priced at $0.824 per unit.

According to the trust manager, there was strong participation from existing unitholders and new institutional investors. The demand was taken up by institutional investors, private wealth clients, and multi-strategy funds.

The issue price of $0.824 represents a discount of 5.8 per cent of the volume weighted average price (VWAP) of $0.8746 per unit in MUST, and 3.4 per cent of the adjusted VWAP of $0.8533 per unit for trades done on April 29.

Arun George, IPOs, M&A and TMT analyst at Global Equity Research Ltd, and a Smartkarma Insight provider, noted that the placement proceeds will help to fund Manulife US REIT’s $122-million acquisition of Centerpointe properties in Virginia.

The joint lead managers and underwriters for the private placement were DBS Bank Ltd., CLSA Singapore Pte Ltd., and Oversea-Chinese Banking Corporation.

SGX-listed CDL buys into IREIT, its trust manager for $57m 

Singapore-listed property developer City Developments Limited (CDL) has acquired 50 per cent stake in IREIT Global Group Pte Ltd (IGG), the manager for Singapore-listed IREIT Global, for S$18.4 million ($13.51 million), from Tikehau Investment Management Asia Pacific Pte Ltd.

According to The Business Times, Tikehau previously owned 84.5 per cent in IGG, and it bought out the minority shareholder of IGG just before the deal with CDL on April 29, 2019.

CDL then made a further acquisition of 12.4 per cent of the total issued units (78.6 million units) in IREIT Global for S$59.4 million ($43.62 million).

The aggregate price for both acquisitions works to be around S$77.8 million ($57.13) million.

IREIT Global invests in income-producing office, retail, and industrial properties in Europe. Its current portfolio comprises five freehold office properties in Germany’s cities of Berlin, Bonn, Darmstadt, Munich, and Münster, valued at $564.96 million.