Mapletree Pan Asia Commercial Trust (MPACT) has sold the office component of a mixed-use asset in Hong Kong to an unrelated third party for HK$2bn (€220m).
The Festival Walk Tower is the office component of Festival Walk, a seven-storey shopping mall located in the Kowloon Tong residential district, close to two major universities.
Following this divestment, MPACT, managed by the Temasek-backed Mapletree, will retain 100% ownership and operations of Festival Walk’ remaining components.
Mapletree bought Festival Walk from Swire Properties in 2011 for HK$18.8bn – its first commercial property acquisition in Hong Kong.
Mapletree said: “By sharpening MPACT’s focus on quality assets and prudently managing the macro-economic headwinds in Greater China, this move strengthens the portfolio’s core stability.
“Divestment proceeds will be directed towards debt reduction to further enhance financial flexibility and position MPACT to capitalise on future opportunities.” With net proceeds from the latest divestment directed towards debt reduction, MPACT’s aggregate leverage would improve from 37.6% to approximately 36.5%.
The latest transaction follows the successful divestment of two Japan office buildings in August this year.
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