CapitaLand Open End Real Estate Fund (COREF), a newly-established fund, and CapitaLand Integrated Commercial Trust (CICT) have agreed to buy an office tower building in Singapore for S$1.26bn (€844m).
The 79 Robinson Road office building at Tanjong Pagar is held in a special purpose vehicle, Southernwood Property, in which CapitaLand Investment has a 65% stake and a joint venture between subsidiaries of Mitsui & Co and Tokyo Tatemono holds the remaining 35%.
COREF and CICT are acquiring 30% and 70% respectively of the shares of Southernwood Property, said CapitaLand.
The office asset was completed in 2020 and marks COREF’s first acquisition in Singapore and its third asset after investing in two properties in Japan.
COREF targets to raise between US$1bn (€908m) and US$1.5bn after an initial three-year build-out period.
CapitaLand Investment said the core fund was on track to reach its first closing of US$500m in capital commitments. The sponsor has committed to a long-term stake in COREF of 10%.
Simon Treacy, CEO, private equity real estate, CapitaLand Investment, said: “COREF is off to a positive start with its third acquisition in six months.”
He said the acquisition reflected COREF’s focus on capitalising on evolving real estate trends, including regionalisation, decentralisation, emerging locations and evolving work norms.
Tony Tan, CEO of the manager of CICT, said: “The investment reinforces CICT’s continued focus on Singapore and is part of our ongoing portfolio reconstitution to enhance portfolio quality and resilience.”
He added that coupled with Capital Tower, another prime office property across the street from 79 Robinson Road, the acquisition would provide CICT with a “dominant position” in the Tanjong Pagar office sub-market.
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