CapitaLand Integrated Commercial Trust's (CICT) indirectly wholly-owned subsidiary has agreed to acquire two Grade A office buildings in Sydney, Australia, for A$330.7 million. This marks CICT’s first inroad into Australia, its second overseas developed market after Germany. Subject to completion adjustments, CICT's total acquisition outlay is about A$381 million. The acquisition is expected to be completed in 1Q 2022.
The two buildings are located in Sydney's central business district and both properties are located within easy access of public transport and amenities.
Teo Swee Lian, Chairman of CICTML, said the ‘this is an opportune time for CICT to enter Australia, given its attractive office market underpinned by healthy economic fundamentals in the medium to long term, and expected recovery as the country emerges from COVID-19 restrictions. In particular, Sydney is witnessing major development and rejuvenation initiatives in line with its government-backed ambition to become a leading innovation and technology hub in the region. The acquisition will allow CICT to gain a foothold in Australia, one of Asia Pacific’s largest developed markets, and open CICT to more opportunities to drive growth.
‘The acquisition is part of our continual efforts to reconstitute and optimise CICT’s portfolio for sustainable returns and growth,’ says Tony Tan, CEO of CICTML. The two assets are complementary to CICT’s portfolio and will enhance our portfolio resilience with further geographical and income diversification, according to Tony.
Post-acquisition, CICT’s overall portfolio property value will increase to S$22.4 billion10 by approximately 3% and their overseas portfolio exposure will increase to about 7% from 4% by portfolio property value, says the release.