CapitaLand divests 50.0% interest in CapitaGreen to CapitaLand Commercial Trust for S$318.3 million
Move is in line with CapitaLand’s capital recycling strategy
Singapore, 23 May 2016 – CapitaLand Limited is pleased to announce its proposed divestment of its 50.0% interest in units in MSO Trust, a special purpose sub-trust which holds CapitaGreen, a Grade A office tower. Currently, MSO Trust is jointly owned by CapitaLand Group (50.0% interest), CapitaLand Commercial Trust (CCT) (40.0% interest) and Mitsubishi Estate Asia Pte Ltd (MEA) (10.0% interest). CCT will exercise a call option to acquire the 50.0% interest from CapitaLand, which is subject to the approval of CCT’s unitholders, as well as the 10.0% interest from MEA. This call option is part of a joint venture agreement signed in 2011 and is conditional on market valuation being equal to or above the hurdle price1 . The proposed divestment is based on CapitaGreen’s agreed market value of S$1,600.5 million (S$2,276 psf), which is the average of two independent valuations2.
CapitaLand’s 50.0% of units in MSO Trust is divested for an estimated aggregate amount of approximately S$318.3 million. This amount comprises S$152.8 million of sale consideration3 and S$165.5 million of CapitaLand Group’s proportionate share of the MSO Trust’s existing unitholders’ loans and its accrued interest.
Based on the latest market valuation determined by the two independent valuers2 , CapitaLand will be realising a gain of approximately S$196.0 million, comprising S$8.5 million from the divestment as well as cumulative revaluation gain of approximately S$187.5 million recognised between 2013 and 2015.
Mr Lim Ming Yan, President and Group CEO of CapitaLand, said: “CapitaGreen is a worldclass office asset which has garnered many accolades for its iconic sustainable design and construction innovations. It is a strong testament of CapitaLand’s leadership position in real estate investment, development, operations and asset management. The proposed divestment of CapitaLand’s 50.0% interest in CapitaGreen is part of our robust capital recycling strategy which enables us to realise development gains and enhance financial flexibility to redeploy capital to ventures that will generate returns for our shareholders.”
Completed in December 2014, CapitaGreen is a Grade A premium office tower developed on the site of the former Market Street Car Park. It is located in the heart of Singapore’s Central Business District (CBD) near the Raffles Place and Telok Ayer Mass Rapid Transit stations. With a net lettable area (NLA) of approximately 703,000 square feet (sq ft), CapitaGreen has generous, column-free, typical floor plates of 22,000 sq ft and raised floorto-ceiling height of 3.2 metres. Designed by Pritzker Prize winner Toyo Ito, CapitaGreen has garnered many local and international awards for its environmentally sustainable and inclusive design.
As at 31 March 2016, CapitaGreen’s committed occupancy was 92.8% with a well-spread lease expiry profile. The property has no leases expiring prior to 2018 which avoids the period of large, new supply in the office market. Given its excellent location, modern Grade A specifications and unique architectural design, the building has attracted tenants comprising multi-national corporations across different industry sectors including insurance, technology, energy and commodities, as well as banking and financial services.