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FCT to acquire additional 24.5% effective stake in Nex for $523.1 mil

By Felicia Tan

/ The Edge Singapore |

January 25, 2024 11:17 AM SGT

Nex is the largest suburban shopping mall in Singapore with seven floors and a total net lettable area of 634,631 sq ft (Photo: Frasers Property)

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Frasers Centrepoint Trust (FCT) has agreed to acquire an additional 24.5% interest in Nex for $523.1 million. The trust entered into a share purchase agreement (SPA) with its sponsor, Frasers Property, to acquire the total issued share capital of FCL Emerald. FCL Emerald is wholly-owned by Frasers Property and holds a 49.0% interest in Nex. FCL Emerald also owns a 49.0% interest in Frasers Property Coral, which is the trustee-manager of the private trust, NP Trust. NP Trust holds a 50.0% stake in Gold Ridge, which holds Nex.

The acquisition follows FCT’s initial acquisition of 25.5% in Nex in February 2023. Following the acquisition, FCT will have an effective interest of 50.0% in the mall.

“Nex is an excellent asset with strong financial and operational performance and is a strategic fit to FCT’s prime suburban retail portfolio. This acquisition reinforces our focus and leadership position in the Singapore prime suburban retail market,” says Richard Ng, CEO of the manager.

Read also: Frasers Centrepoint Trust sells Changi City Point for $338 mil

“The increased stake in Nex will further diversify FCT’s income base, enhance its portfolio resilience and improve its overall retail portfolio performance. The growth opportunities at NEX through asset enhancement initiatives (AEI), tenant remixing and rent improvement will support FCT’s objective to deliver regular and stable distributions to its unitholders. This acquisition is also distribution per unit (DPU) accretive,” he adds.

The agreed value of Nex is $2.13 billion on a 100% basis or $3,352 psf of net lettable area (NLA). The agreed property value is the average of the two independent valuations of Colliers’ estimate at $2.14 billion and Jones Lang LaSalle’s estimate of $2.11 billion.

The net property income (NPI) yield based on Nex’s NPI for the FY2023 ended Sept 30, 2023, and the agreed property value is approximately 4.8%.

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