SINGAPORE (June 24): On June 18, demand for ESR-REIT’s placement was so good that the manager upsized the offering. In an earlier announcement, ESR-REIT had said it planned to raise not less than $75 million and not more than $100 million from the placement. In fact, the real estate investment trust raised $99.999 million through a placement of 194.17 million shares at 51.5 cents apiece. The REIT owns 57 industrial properties — all in Singapore — valued at $3.03 billion.
The overnight placement on June 18 was part of a funding exercise that included a non-renounceable preferential equity offering to existing unitholders on a pro rata basis to raise not more than $50 million. The REIT has stated that it does not want to raise more than $150 million. ESR Cayman, the sponsor, which owns 9.4% of ESR-REIT, will provide an undertaking to take up its pro-rata entitlement of the preferential offering.
Of the monies raised, ESR-REIT plans to use $44.4 million, or 29.6%, to fund the acquisition of 48 Pandan Road; $45.7 million, or 30.5%, to fund asset enhancement initiatives (AEIs) at 7000 Ang Mo Kio Avenue 5 and UE BizHub East; and $56.8 million, or 37.9%, to pare debt. The remaining $3.1 million will be used to pay expenses.
