Published January 8, 2010

[B][SIZE="5"]Frasers Reit buys two malls for $290m[/SIZE][/B]


FRASERS Centrepoint Trust (FCT) said yesterday that it will buy two suburban malls for $290.2 million.

The retail real estate investment trust (Reit) also said it plans to issue up to 152 million rights units to help finance the mall acquisitions. The remaining amount will be borrowed.

The structure and timing of the issue of new units has not been determined, FCT added.

The Reit will acquire Northpoint 2 at Yishun for $164.55 million and YewTee Point in Choa Chu Kang for $125.65 million from its sponsor Frasers Centrepoint, the property arm of Fraser and Neave.

The transactions are subject to approval by FCT unitholders. The two acquisitions will grow the trust's portfolio 25 per cent to $1.5 billion.

'Northpoint 2 and YewTee Point are excellent suburban retail malls strategically located in the town centres of established high-density housing estates,' said Christopher Tang, chief executive of FCT's manager.

'Both malls are in the immediate vicinity of MRT stations, which deliver a high level of shopper traffic. With captive shopper catchments, occupancy rates at or close to 100 per cent and diverse bases of quality tenants, both malls would be invaluable additions to FCT's portfolio of high-quality suburban malls.'

The trust now has three malls - Causeway Point, Northpoint and Anchorpoint. Northpoint 2, a new extension to Northpoint, has a net lettable area of 85,530 sq ft. YewTee Point has 72,382 sq ft.

FCT said the two additions will enhance its asset, income and tenant diversification, the trust said. The malls will add more than 70 new tenants. And the larger asset and unit base - after the issue of the rights units - is expected to enhance the trust's overall capital management flexibility.

FCT said that the price of the rights units will be determined closer to the launch date.

FCT units gained four cents or 2.8 per cent to close at $1.45 yesterday.