ESR HK Management on Aug 5 acquired 400,000 units of AIMS APAC REIT (AA REIT) for $485,440, or an average of $1.21 each. It now owns a direct stake of 9.1 million units, or 1.29% of AA REIT. ESR HK Management also owns other AA REIT units through various related entities such as ESR Cayman and e-Shang Infinity Cayman. As a result, ESR HK Management’s total stake in AA REIT is now 91.9 million units, or 13%, up from 12.95% previously.

On Aug 6, AA REIT announced plans to issue a tranche of perpetual securities worth $125 million with a coupon of 5.65%. This tranche is part of the $750-million multicurrency debt issuance programme established on Nov 30, 2018. Proceeds from this issuance will go towards funding a new acquisition.

Four days later on Aug 11, AA REIT announced the acquisition of a ramp-up logistics warehouse at Jurong for $129.6 million from Titan (Wenya). The warehouse at 7 Bulim Street has an existing master lease to KWE-Kintetsu World Express (S), a subsidiary of a Japanese company. The existing lease started on Jan 1, 2014, for 10 years, with a five-year renewal option. The property was acquired at an initial net property income yield of 7.07%. On a pro forma funding structure of perpetual securities and debt financing, the proposed acquisition will add 0.18 cent to AA REIT’s DPU for FY2020 ended March 2021 to 9.68 cents from 9.50 cents.

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