Logos signs major industrial sale-and-leaseback deal in Singapore

Pan-Asian logistics group Logos has secured one of the most coveted industrial sites in Singapore through a long-term sale-and-leaseback agreement with solar panel company REC for an undisclosed amount.

There are five campus-style buildings, offering more than 150,000sqm of lettable space, on the 25-hectare site in Tuas South, a growing industrial submarket in the west of Singapore.

Stephen Hawkins, managing director for Southeast Asia at Logos, said the existing industrial and warehouse facilities are 100% leased to REC on a long lease.

Hawkins declined to comment on the value of the transaction, which involved working with Singapore government agencies with oversight of the city state’s industrial development.

However, market sources in Singapore familiar with the local logistics market told IPE Real Assets that a site of this size, and its location, would be worth “north of S$500m” (€322m).

One source said the fact that the leasehold from the government had more than 50 years would also add to its value.

IPE Real Assets understands that REC’s leaseback arrangement will run for at least 10 years, which is seen as particularly valuable by Logos.

“The REC agreement sees us strengthen our presence in the strategic Tuas South market, which is set to benefit from future government-approved infrastructure improvements including the Tuas Mega Port,” said Hawkins.

Tuas Mega-Port which, when completed, will house all of Singapore’s future container activities and handle up to 65 million standard-sized containers – up from some 40 million today.

REC chief financial officer Jan Enno Bicker said: “The sale-and-leaseback transaction will unlock capital which will be deployed to further strengthen REC’s balance sheet and enable investment in new technology and expansion.

“Since our founding 22 years ago in Norway, we have been committed to sustainable growth based on technology leadership and high-quality products.”

REC is in the business of converting polysilicon into wafers, solar cells and solar panels. This facility comprises three main buildings that make up the entire manufacturing chain for the production of solar panels.

Hawkins told IPE Real Assets that Logos plans to seek approval to develop another 100,000sqm of logistics space on the site, which would be offered to the open market.

The latest transaction brings Logos’ portfolio to five assets in Singapore, which it sees as one of its key markets in Southeast Asia.

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