The trustee-manager of Dasin Retail Trust says its indirect wholly-owned subsidiary, Zhongshan Yuanxin Commercial Property Management Co, has entered into an agreement with Zhongshan East Youyuecheng Store Management to terminate its lease in Superior City Department Store at Ocean Metro Mall.
The lease agreement was originally signed in Dec 26, 2014, and was for a term of 15 years from Dec 28, 2014 to Dec 27, 2029.
The termination was mutually agreed upon, says the trustee-manager in a Nov 10 statement.
Under the terms of the termination agreement, the Superior City Lease Agreement terminated on Nov 8.
Zhongshan East Youyuecheng Store Management, together with Zhongshan Youyuecheng Store Management, is one of the top ten tenants of Dasin’s property for the FY ended Dec 31, 2019 in terms of annual gross rental income.
See Also: PhillipCapital maintains 'accumulate' on Dasin Retail Trust following higher-than-expected 1H20 DPU and NPI
The trustee-manager says the termination of the agreement is part of its “proactive asset management strategy to further enhance the competitiveness of Ocean Metro Mall and to improve the shopping experience of its customers”.
It says it is also evaluating asset enhancement initiatives (AEI) including refurbishment and re-letting after the termination of the agreement.
Upon the termination, Zhongshan Dasin Metro-Mall Merchant Investment, an interested person of the Trust, will take over the retail space under the lease of Superior City and enter into a one-year lease agreement with Zhongshan Yuanxin Commercial Property Management at a similar rental rate under the Superior City Lease Agreement.
Dasin Metro-Mall Merchant Investment is an interested person of the Trust as it is indirectly collectively wholly-owned by Zhang Zhongming, Zhang Kaicheng and Zhang Jiucheng. Zhang Kaicheng and Zhang Jiucheng are the siblings of Zhang Zhencheng, the chairman and non-executive director of the trustee-manager.
Units in Dasin Retail Trust closed flat at 79 cents on Nov 10.