CapitaLand Ascendas REIT (CLAR) has announced plans to acquire two technology-centric commercial properties in Singapore for a total consideration of approximately S$700.2 million, in a move that will deepen its exposure to the city-state and expand its data centre and life sciences portfolio.
The proposed acquisitions include a Tier III colocation data centre at 9 Tai Seng Drive and a premium business space asset at 5 Science Park Drive.
The additions are expected to raise the value of CLAR’s Singapore portfolio by 6.6% to S$11.7 billion, representing 67% of the REIT’s total assets under management on a pro forma basis.
9 Tai Seng Drive, strategically located within the Tai Seng Industrial Estate, is expected to increase CLAR’s data centre assets by nearly a third to S$1.9 billion.
The facility is fully committed to tenants in the digital, e-commerce, and financial services sectors and offers potential for rental growth due to current leases being significantly below market rates.
It also provides further expansion options, including higher power usage, pending regulatory approval.
5 Science Park Drive, situated in Singapore Science Park 1 and part of the “Geneo” life sciences cluster, is currently occupied by Shopee and serves as the company’s regional headquarters.
The property complements CLAR’s existing stake in the nearby 1 Science Park Drive development and reinforces its presence in the growing innovation and R&D corridor.
Both assets are modern, green-certified buildings with long remaining land leases. The acquisitions are projected to generate stable income streams and support organic growth through rental reversion.
The estimated NPI yields stand at 7.1% and 5.7% respectively, post-transaction costs.
The REIT manager expects the transactions to be DPU accretive, with a combined uplift of 1.36% based on FY2024 pro forma figures.
CLAR intends to finance the acquisitions through a mix of equity fundraising and debt. The deals are subject to unitholder approval, given their classification as interested party transactions.
Upon completion, CLAR’s global portfolio will consist of 232 properties across Singapore, Australia, the U.S., and Europe.
Business News Asia