Suntec REIT (SUN) is unlocking value with its divestment of 9 Penang Road, note CGS-CIMB Research analysts Lock Mun Yee and Eing Kar Mei.

This follows a June 16 announcement that SUN had divested its 30% stake in 9 Penang Road to its existing JV partner, Haiyi Holdings Pte Ltd, at an agreed property value of $295.5 million ($2,468 per sq ft) or at an implied stabilised net yield of 3.3%.

The property has a total net lettable area of 399,000 sq ft with a committed occupancy of 98.7% as at March 2021. The agreed property value is 5.7% higher than the average May 2021 valuation of $931.8 million and 30.3% higher than the total development cost of $756 million.

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