CLAR expands US logistics portfolio with first sale and leaseback acquisition for $150.3 million

The long lease term of roughly 11 years with inbuilt rental fee escalation of 3.5% per annum will provide earnings security and reinforce the resilience of CLAR’s portfolio, claims the manager.

After adding transaction-related charges and costs of $1.7 million, in addition to a $1.5 million procurement fee paid off to the supervisor, the complete acquisition price will be $153.4 million.

Completed in 2022, the property stands in Whiteland, a submarket in southeast Indianapolis, Indiana. The building is a completely air-conditioned, single-storey logistics building with a GFA of 979,649 sq ft.

Following the procurement, DHL U.S.A. will enter into a continued leaseback till December 2035 of the building’s whole gross floor surface area (GFA) with choices to continue for 2 additional five-year terms.

The first-year net property income (NPI) revenue of the proposed purchase is about 7.6% pre-transaction prices and 7.4% post-transaction expenses. The pro forma influence on the distribution per unit (DPU) for the financial year finished Dec 31, 2023 is anticipated to be an improvement of roughly 0.019 Singapore cents, or a DPU accretion of 0.1%, presuming the recommended procurement was finished on Jan 1, 2023.

19 Nassim condominium

The procurement will boost the worth of CLAR’s logistics assets under management (AUM) in the US by 35.3% to some $587.5 million. With this purchase, CLAR’s logistics track in the US will definitely increase to 20 properties across 4 towns with an overall GFA of approximately 5.1 million sq ft.

Apart from this latest real estate in Indianapolis, CLAR’s logistics possessions in the United States rise in Kansas City, Chicago and Charleston.

The manager intends to finance the total acquisition fee through a mix of inner sources, divestment proceeds and/or existing debt centers, according to a Dec 17 announcement.

CapitaLand Ascendas REIT (CLAR) has proposed to get DHL Indianapolis Logistics Facility, a Class A logistics property, from Exel Inc. d/b/a DHL Supply Chain (DHL U.S.A.) for $150.3 million. This is a 4.1% price cut to the independent market valuation of the property as at Jan 1, 2025.

The fully taken up building, with its weighted average lease to expiry (WALE) of around 11 years, will certainly raise CLAR’s US profile WALE from 4.2 years to 4.7 years on a pro forma basis.

William Tay, executive director and chief executive officer of the manager, mentions: “DHL Indianapolis Logistics Center is a strategic fit with our existing profile … This is CLAR’s primary sale and leaseback procurement in the America and including this Class A logistics property, modern-day logistics properties will certainly make up 42.3% of our United States logistics properties under control. With the long rent in place, this real estate is going to further boost CLAR’s durable earnings stream, and we anticipate the two brand-new properties to add positively to our long-term returns.”


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