http://www.straitstimes.com/Money/St...ry_696351.html
Jul 30, 2011
Frasers Centrepoint Trust buys Bedok mall
By Esther Teo PROPERTY REPORTER
FRASERS Centrepoint Trust (FCT) is buying Bedok Point mall near Bedok MRT station for $127 million, it was announced yesterday.
Frasers Centrepoint Asset Management (FCAM), the trust's manager, is acquiring the building from its sponsor Frasers Centrepoint.
It said the four-storey mall comprising small speciality shops and many food and beverage outlets had stabilised, with healthy shopper traffic and robust occupancy rates, after its soft launch last December.
It has recorded a footfall of more than five million shoppers in the seven months after it opened.
The price works out to $1,568 per sq ft (psf) of net lettable area.
FCAM chief executive Chew Tuan Chiong said injecting the mall into the trust would give unit-holders a higher distribution per unit while allowing for income diversification, a bigger tenant base and an enlarged market share of suburban malls. The mall has a net lettable area of 81,000 sq ft. Rents also average $11 psf a month.
While CapitaLand's mall nearby is expected to be completed by 2014, Dr Chew said this was not necessarily a concern as it would help provide a critical mass of retail space to draw in Bedok's 200,000 residents.
'We see it as both a potential competitor and a potential asset. Right now, the area is not a destination, but when there is a good collection of air-conditioned shopping space, the number of people who will frequent the area will increase,' he added.
'The impact will not be big... But certainly, there will be tenants who will have to choose between the two.'
The combined net lettable area of the two malls will be about 310,000 sq ft - still 'not very big', considering the size of Bedok, Dr Chew noted.
Both malls are complementary and will make Bedok town centre more vibrant, possibly attracting shoppers from other areas, said Mr Alex Chia, FCAM's head of investment.
The mall will be the fifth property in FCT's portfolio - which focuses on suburban retail malls - bringing its asset size to $1.66 billion. FCAM said debt financing for the deal is expected to be in the form of a drawdown from available loan facilities, while equity financing is expected to be in the form of a private placement.
FCT's units were up half a cent to $1.54 yesterday.
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