Manulife US Real Estate Trust (MUST) is divesting an office asset in California for US$117m (€105m) to repay debt.
The Singapore-listed real estate investment trust’s manager said the 29-storey office block at 400 Capitol Mall in downtown Sacramento would be sold to an unrelated third-party, known simply as, 400 CM Owner.
The asset was independently valued at US$158m as of 31 December 2023.
The trust said net sales proceeds and existing cash would be utilised to repay its US$130.7m loans, due next year, by the end of 2024. Post-repayment, there will be no loan maturities until 2026.
John Casasante, CEO and CIO of the manager of MUST, said: “We have taken a first major step towards the ‘recovery’ phase of our strategic roadmap.
“Despite the ongoing challenges in US office market and the lack of debt availability that continues to hamper transactions, we were able to secure the sale of Capitol to an all-cash buyer, which provides us with the liquidity and flexibility to make an early repayment of the 2025 debt maturities and mitigate risks amid an uncertain environment.”
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