PROSPERITY REIT Adds HKD1 Bln Property; PRC Real Estate Facing Headwinds:
ARA Asset Management (Prosperity) Ltd, as manager of Prosperity REIT, said that HSBC Institutional Trust Services (Asia) Ltd -- on behalf of Prosperity REIT and acting on the instructions of the REIT Manager -- entered into the share purchase agreement for the Hong Kong commercial property.
Upon completion, Prosperity REIT will, through Clifton Properties Ltd, hold the property, which is strategically located in the mature decentralized business district of Kowloon East (CBD2).
The property is in close proximity to the Ngau Tau Kok MTR station and is easily accessible by private and public transportation such as taxis and buses.
Furthermore, the property is adjacent to one of Prosperity REIT’s existing properties -- Prosperity Center -- and is only 10 minutes away from another of Prosperity REIT's flagship properties, Prosperity Place.
“The acquisition is expected to be yield accretive and improve the earnings and DPU to existing unitholders.
“The relatively low initial net property income of the property is a result of over 50% of the tenancies being due for expiry in 2014, which are below current market rental, thus offering substantial reversionary upside,” said REIT Manager CEO Ms. Mavis Wong.
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