SINGAPORE - Prime US Reit has entered into a purchase agreement to acquire an office tower located in the downtown area of Sacramento, California for US$165.5 million .
The proposed acquisition will allow Prime US Reit to expand its footprint to Sacramento, following which no single market will contribute more than 13 per cent of the Reit's cash rental income, said its manager, KBS US Prime Property Management. The manager is an associate company of Singapore Press Holdings - which publishes The Straits Times and The Business Times.
Around US$95.4 million of the gross proceeds will be used to partially fund the Park Tower acquisition, while around US$4.6 million will be used to pay estimated fees and expenses, including land transfer taxes, professional fees and expenses, related to the proposed acquisition and private placement. Any remaining gross proceeds will be used for general corporate and/or working capital purposes.
DPU under the cumulative distribution is estimated to be 4.11 US cents, with the actual amount to be announced after the finalisation of the Reit's management accounts for the relevant period. Income available for distribution was US$16.4 million, up 8.8 per cent from a forecast of US$15 million.Meanwhile, for the full year ended Dec 31, DPU was 7.5 per cent higher at 3.15 US cents, versus a forecast of 2.93 US cents, and income available for distribution grew 7.3 per cent to US$29.2 million from a forecast of US$27.2 million.
In a separate announcement on Wednesday morning, the manager announced that Prime US Reit has entered into a purchase agreement with GV/HI Park Tower Owner to acquire a property located in the downtown area of Sacramento, California for US$165.5 million . The proposed acquisition will allow Prime US Reit to expand its footprint to Sacramento, following which no single market will contribute more than 13 per cent of the Reit's cash rental income, the manager added.
Around US$95.4 million of the gross proceeds will be used to partially fund the Park Tower acquisition, while around US$4.6 million will be used to pay estimated fees and expenses, including land transfer taxes, professional fees and expenses, related to the proposed acquisition and private placement. Any remaining gross proceeds will be used for general corporate and/or working capital purposes.
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