CLAR expands US logistics portfolio with first sale and leaseback acquisition for $150.3 million
The fully taken up building, with its weighted average lease to expiry (WALE) of about 11 years, will increase CLAR’s United States portfolio WALE from 4.2 years to 4.7 years on a pro forma basis.
Aside from this newest property in Indianapolis, CLAR’s logistics properties in the US rise in Kansas City, Chicago and Charleston.
Following the acquisition, DHL USA will become part of a long-term leaseback till December 2035 of the building’s overall gross floor surface area (GFA) with possibilities to extend for 2 added five-year terms.
The long lease term of approximately 11 years with inbuilt rental fee acceleration of 3.5% per annum will certainly provide income stability and enhance the durability of CLAR’s portfolio, states the supervisor.
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 presence in the US will expand to 20 properties across 4 towns with a total GFA of approximately 5.1 million sq ft.
After including transaction-related fees and expenses of $1.7 million, in addition to a $1.5 million acquisition fee paid off to the manager, the complete acquisition price are going to be $153.4 million.
William Tay, executive head and CEO of the manager, says: “DHL Indianapolis Logistics Center is a strategic fit with our existing profile … This is CLAR’s first sale and leaseback acquisition in the America and including this Class A logistics estate, contemporary logistics properties will account for 42.3% of our United States logistics assets under management. With the long lease in place, this property will further boost CLAR’s resistant earnings stream, and we anticipate the two brand-new properties to add favorably to our extended returns.”
Completed in 2022, the estate stands in Whiteland, a submarket in southeast Indianapolis, Indiana. The building is an entirely air-conditioned, single-storey logistics building with a GFA of 979,649 sq ft.
The manager intends to pay for the complete purchase fee via a combination of inner sources, divestment proceeds and/or existing debt facilities, according to a Dec 17 press release.
CapitaLand Ascendas REIT (CLAR) has proposed to obtain DHL Indianapolis Logistics Facility, a Class A logistics real estate, from Exel Inc. d/b/a DHL Supply Chain (DHL USA) for $150.3 million. This is a 4.1% price cut to the independent market evaluation of the real estate as at Jan 1, 2025.
The first-year net property income (NPI) revenue of the suggested acquisition is roughly 7.6% pre-transaction expenses and 7.4% post-transaction costs. The pro forma effect on the distribution per unit (DPU) for the financial year stopped Dec 31, 2023 is expected to be an improvement of roughly 0.019 Singapore cents, or a DPU rise of 0.1%, thinking the proposed purchase was completed on Jan 1, 2023.
