Singapore: CapitaLand Mall Trust sells Sembawang Shopping Centre for $189m

Sembawang Shopping Centre

Real estate investment manager CapitaLand Mall Trust has sold Sembawang Shopping Centre for S$248 million ($189 million), one of the largest sale value achieved in recent years for a stand-alone retail mall in Singapore.

According to a statement released by CapitaLand Mall, Sembawang Shopping Centre was sold to a joint venture between Lian Beng Group Ltd and Apricot Capital Pte. The mall has an original leasehold tenure of 999 years.

Based on the latest independent valuation, Sembawang Shopping Centre was valued at S$126.0 million ($96 million) as at 31 December 2017.

The divestment is expected to generate net proceeds of about S$245.6 million ($187 million) and a net gain of about S$119.6 million ($91.2 million) when the transaction is completed by June 2018.

Sembawang Shopping Centre is situated in close proximity to Sembawang MRT Station and Yishun MRT Station. It features a good mix of F&B tenants, retailers, and a hypermarket that appeal to the residents from the surrounding estates, uniformed personnel from nearby military camps, and workers from the neighbouring industrial parks.

“The divestment of Sembawang Shopping Centre is in line with our portfolio management strategy of maximising returns for our unitholders,” Tony Tan, CEO CapitaLand Mall, said.

As the mall accounts for only about 1 per cent of CapitaLand Mall’s total asset value, its sale will have minimal impact on its financial performance and distribution per unit. The net proceeds from the divestment will further enhance and strengthen the firm’s financial flexibility, Tan said.

Upon completion of this transaction, CapitaLand Mall Trust’s portfolio will comprise 15 properties located in suburban areas and downtown core of Singapore. They are Tampines Mall, Junction 8, Funan, IMM Building, Plaza Singapura, Bugis Junction, JCube, Raffles City Singapore, Lot One Shoppers’ Mall, Bukit Panjang Plaza, The Atrium@Orchard, Clarke Quay, Bugis+, Westgate, and Bedok Mall.

The Singapore real estate sector has witnessed a steady flow of deals in recent years, driven by buoyant investor sentiment as well as recovery in the residential and commercial property segments, according to Jerome Wright, director of Capital Markets & Investment Services at Colliers International.

Just this week, a consortium led by Sustained Land Pte Ltd has bought Asia Gardens, a freehold development located along Everton Road, for S$343 million ($262 million) via a collective sale.

Asia Gardens is a 23-storey development with 80 apartment units and four penthouses. The consortium of buyers also includes Ho Lee Group, a Singapore builder and developer, and an investment holding company owned by Loi Pok Yen.

Marketing agent CBRE is also selling Faber Garden, a freehold condominium development located at Angklong Lane at an asking price of S$1.18 billion ($900 million).

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