Picture : HK's AIG TowerSINGAPORE: Property developer CapitaLand says it has sold its effective 45 per cent stake in Hong Kong's AIG Tower for some S$710 million in cash and debt.
The buyer, American International Assurance Company, will pay S$355 million for the shares that CapitaLand owns in AIG Tower. Another S$355 million will go towards repaying the loans granted by CapitaLand's units for the development of the project.
All in, the transaction values AIG Tower at about S$1.58 billion.
CapitaLand will book nearly S$261 million in gains from the sale, which is due to be completed at the end of November.
AIG Tower is a prime Grade A office building in Hong Kong's Central business district.
It was built in April 2005 on the former Furama Hotel site at 1 Connaught Road.
The 26-storey building is fully occupied with prominent tenants including American International Group, Bank of Tokyo Mitsubishi UFJ, CapitaLand, Kohlberg Kravis Roberts & Company, Lai Sun Group, Oaktree Capital, Royal Bank of Scotland and Wachovia Bank.
The latest deal is seen as CapitaLand's ongoing efforts to achieve better returns from its property portfolio.
In March this year, CapitaLand sold its stake in Temasek Tower in Singapore's central business district for S$1.04 billion to Macquarie Global Property Advisors.
The deal was one of the biggest office transactions in Singapore. - CNA/ac
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