Current location site: Global

Singapore, 7 October 2025 – CapitaLand Ascendas REIT Management Limited, as the manager (the Manager) of CapitaLand Ascendas REIT (CLAR), is pleased to announce the proposed acquisition of a portfolio of three properties in Singapore (Target Portfolio) for approximately S$565.8 million^[1] (Total Purchase Consideration).  The Target Portfolio consists of 2 Pioneer Sector 1, a ramp-up logistics property; Tuas Connection, a light industrial property; and 9 Kallang Sector, a high-specifications industrial property (collectively, the Target Properties, and the proposed acquisition of the Target Properties, the Proposed Acquisitions), to be acquired from Vita Partners.  The Proposed Acquisitions are expected to be completed by 1Q 2026.

Rationale and Merits of the Proposed Acquisitions

1. In line with strategy to remain Singapore-focused

The Proposed Acquisitions are in line with CLAR’s strategy to anchor its portfolio in Singapore.

The Target Properties will increase the value of CLAR’s Singapore portfolio to approximately S$12.3 billion and the Singapore portfolio will account for 68% of CLAR’s total assets under management (AUM)^[4].

2. Strategically located properties in main industrial and logistics hubs

The Target Properties are well-located in key industrial estates in Singapore, close to infrastructure networks such as airports and seaports.  They are also easily accessible via expressways and public transportation.

2 Pioneer Sector 1 and Tuas Connection are situated in the western region of Singapore within Jurong Industrial Estate, Singapore’s first and largest industrial estate.  Both properties are conveniently located near the major seaports of Singapore, namely Jurong Port and Tuas Mega Port, as well as Tuas Second Link which connects Singapore to Johor, Malaysia. The Ayer Rajah Expressway and Pan Island Expressway (PIE) are about a five-minute drive from these two properties.  

9 Kallang Sector is located on the fringe of the central business district (CBD) within the Kallang Planning Area.  It is situated in an established industrial estate surrounded by various food & beverage options, amenities and two nearby Mass Rapid Transit (MRT) stations.  Adjacent to the PIE, the property is about a 15-minute drive from both Changi International Airport and the CBD. 

3. Attractive property specifications

2 Pioneer Sector 1 is a four-storey ramp-up logistics property that was newly completed in 2023.  Its best-in-class specifications include high ceilings, good floor loading capacity and dedicated loading bays with ample dock levellers.

Tuas Connection comprises 15 double-storey industrial units suitable for manufacturing and production.  Key features include dedicated private compounds, good floor loading capacity and functional layouts for operational efficiency.

9 Kallang Sector is an eight-storey, high-specifications industrial property completed in 2019.  This modern built-to-suit development is currently occupied by a German-headquartered technology firm which is a subsidiary of an American multinational technology corporation.

4. Contribute to the resilience of CLAR’s income stream

The Target Properties are fully occupied by 19 tenants with a long WALE of approximately 5.5 years^[5].  There are also rental growth opportunities with rental escalations in most of the leases, ranging from 1% to 5% per annum, and in-place rents are about 15% below current market rents.

Most tenants are publicly listed companies and multinational corporations in industries such as electronics & semiconductors, transportation & logistics, precision engineering as well as pharmaceuticals & life sciences.  This will further enhance and diversify CLAR’s quality tenant base.

5. Distribution per Unit (DPU) accretive acquisitions

The expected first year net property income yield^[6] of the Target Portfolio is attractive at approximately 6.4% pre-transaction costs and 6.1% post-transaction costs.

Assuming the Proposed Acquisitions were completed on 1 January 2024, the pro forma impact on the DPU for the financial year ended 31 December 2024 is expected to be an improvement of approximately 0.124 Singapore cents or a DPU accretion of 0.8%^[7].

Valuation of the Target Portfolio

In connection with the Proposed Acquisitions, an independent valuation on the Target Portfolio was jointly commissioned by HSBC Institutional Trust Services (Singapore) Limited, in its capacity as trustee of CLAR (the Trustee) and the Manager.  The aggregate market value of the Target Portfolio is S$589.0 million (Total Valuation)^[8].

Details of the Proposed Acquisitions

The Trustee has entered into conditional put and call option agreements with DBS Trustee Limited, in its capacity as trustee of Supreme REIT (the Vendor), each for the acquisition of 2 Pioneer Sector 1 and Tuas Connection.  

The Trustee has also entered into a share sale agreement with the Vendor and Clay SG Holdings I Pte. Ltd. to acquire 100.0% of the issued share capital of Waterbay Investment Pte. Ltd., the registered proprietor of the property located at 9 Kallang Sector. 

The Total Purchase Consideration of S$565.8 million^[9] was negotiated on a willing-buyer and willing-seller basis. It is at a 3.9% discount to the Total Valuation of S$589.0 million.   

CLAR is expected to incur an estimated total investment cost of S$592.6 million (the Total Investment Cost) which includes the Total Purchase Consideration, the acquisition fee payable to the Manager of approximately S$5.7 million (being 1% of the Total Purchase Consideration), stamp duty and other transaction-related fees and expenses of approximately S$21.1 million.

The Manager intends to finance the Total Investment Cost through a combination of internal resources and/or existing debt facilities.

Please refer to the Annex for more details of the Target Portfolio and Target Properties. 

1. Includes estimated upfront land and enhancement premiums of S$33.2 million. 
2. Please refer to the news release “CapitaLand Ascendas REIT deepens presence in Singapore with accretive acquisitions of two prime properties for approximately S$700 million” dated 28 May 2025 for more information.
3. As at 31 August 2025.
4. On a pro forma basis as at 30 June 2025 and including the acquisitions of 9 Tai Seng Drive and 5 Science Park Drive which were completed in August 2025.
5. As at 31 August 2025.
6. The NPI yield is derived using the estimated NPI expected in the first year after the proposed acquisitions. 
7. The estimated pro forma impact is calculated based on the following assumptions: (i) CLAR had completed the proposed acquisitions on 1 January 2024 and held the Target Properties through 31 December 2024; (ii) the proposed acquisitions were funded based on a funding structure of 40% debt and 60% equity; and (iii) the Manager elects to receive its base management fee 80% in cash and 20% in units of CLAR.
8. The valuations as at 10 July 2025 for 2 Pioneer Sector 1 and Tuas Connection, and the valuation as at 11 July 2025 for 9 Kallang Sector were carried out by Cushman & Wakefield VHS Pte. Ltd. using the discounted cash flow approach and the income capitalisation method.
9. Includes estimated upfront land and enhancement premiums of S$33.2 million. 
10. Includes estimated upfront land and enhancement premiums of S$33.2 million.