The group holds 26% of the units in the Boustead Industrial Fund through its indirect wholly owned subsidiary Metrobilt Construction
[SINGAPORE] Property investment and development group Metro Holdings , which has an indirect stake in a Boustead private real estate fund, said it has not made any decision nor entered into any agreement with respect to the proposed transactions behind Boustead Singapore’s Thursday (Sep 18) announcement.
The announcement concerned the valuation of Boustead Singapore’s proposed real estate investment trust (Reit) listing UI Boustead Reit, which has an estimated portfolio value of S$1.9 billion.
The portfolio will contain 23 logistics and industrial properties, and UI Boustead Reit will use this valuation to decide the amount it is willing to pay to acquire these assets.
The Reit will be sponsored by UIB Holdings, in which Boustead Singapore has a 20 per cent interest. As part of this proposed listing, Boustead Singapore entered into agreements to divest its interests in four Singapore properties through Boustead Projects to UI Boustead Reit on Thursday.
Metro, through its indirect wholly owned subsidiary Metrobilt Construction, holds 26 per cent of the units in the Boustead Industrial Fund (BIF) and the 7 per cent notes due 2031 issued by Perpetual (Asia).
“There is no certainty that any definitive agreement will be entered into and/or that any possible transaction will materialise in respect of the company’s interests from these discussions,” it said in a filing on Thursday.
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BIF is a private real estate trust established and sponsored by Boustead Projects, which comprises a portfolio of 12 properties from BIF. Perpetual Asia is the trustee of BIF.
Boustead Projects sold its 51 per cent stakes in the properties at 29 Media Circle, and 8 and 12 Seletar Aerospace Heights, respectively. It also divested its 62.25 per cent of its stake in a property at 84 Boon Keng Road, and a 37.75 per cent interest in a fourth property at 11 Seletar Aerospace Link, reported The Business Times previously.
Equity research analyst Ada Lim from OCBC Investment Research in her Friday report pointed out that Boustead Singapore, through its real estate division, had extended a right of first refusal (ROFR) to BIF on Dec 31, 2020, which will remain intact post-listing.
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“This seems to suggest that there could be future opportunities for Boustead Singapore to divest mature assets to UI Boustead Reit through BIF,” she wrote. “UIB Holdings as the Reit sponsor will also grant a ROFR to UI Boustead Reit over stabilised assets in its portfolio that align with the Reit’s investment mandate, providing inorganic growth opportunities to the Reit.”
