Ticon trust boosts portfolio with deal
TICON Freehold and Leasehold Real Estate Investment Trust (TREIT) has increased its asset portfolio in a sign of what the managers call the investment vehicle’s business strength and potential.
TREIT recently invested in high-quality assets with total value of Bt90 million from Star Micronics after the board of Ticon Management Co Ltd (TMAN) board approved the deal.
The assets being bought “are of high quality located in one of Thailand's strategic locations for industrial operations with immediate long-term tenancy” for 10 years.
The deal marks the first sale-and-leaseback from the non-Ticon group assets.
The move coincides with TREIT's growth strategy, in which its investment is widely open to quality properties from both Ticon and non-Ticon companies throughout the country and abroad.
The company said it is confident that TREIT will grow by more than Bt3.6 billion this year and provide target returns to its unitholders, reaffirming TREIT's status as |the largest industrial REIT in Thailand.
Peerapat Srisukont, managing director of TMAN, which is the REIT manager of TREIT, said: “In line with the growth plan announced, TREIT consistently pursues investment opportunities in high-quality assets in Thailand and abroad, targeting at a continued growth of Bt2-3 billion in net asset value per annum.
“Most recently, TMAN's board has passed a resolution for TREIT's additional investment plan to acquire real estate assets from Star Micronics Precision (Thailand) Co Ltd (Star Micronics).
Valued at Bt90 million, this transaction will be paid up with TREIT's working capital,” Peerapat said.
The ownership of properties involved comprises land with a total area of 8 rai, 3 ngaan and 53 square wa and two ready-built factory buildings with a usable area of 8,976 square metres.
These properties are located in Rojana Ayutthaya Industrial Park in Ban Chang Sub-district, Uthai District, Ayutthaya province, one of the most strategic locations for industrial operations, Peerapat said.
Moreover, Star Micronics as a seller will sign a 10-year leaseback agreement and continue to occupy the properties as a long-term tenant of TREIT.
Peerapat said that with the investment, TREIT's assets under management have increased to 516 units of factory and warehouse buildings, divided into 70 per cent freehold and 30 per cent leasehold properties.
“These high-quality properties are strategically located in key industrial regions of Thailand, such as Ayutthaya, Pathum Thani, Samut Prakan and the Eastern Economic Corridor (EEC),” Peerapat said.
“They were acquired complete with tenancies of world-class companies from various industries, including next-generation automobiles, logistics and electronics.
“As at the end of September 2018, the occupancy rate stood at 79.2 per cent. On progress of another transaction involving acquisition of real estate assets worth Bt3.6 billion from Ticon the ownership transfer is currently underway with completion expected in December.”
