A-Reit Plans US$180m Developments

Source : The Business Times, September 25, 2007

Singapore's Ascendas Real Estate Investment Trust (A-Reit) will spend $270 million (US$180 million) building new business facilities in the next few months as it shifts focus to development rather than acquisitions, its chief said on Tuesday.

Chief executive officer Tan Ser Ping said A-Reit's ability to create new assets would allow it to stay on track to reach a portfolio size of $5 billion by 2010, despite stiff competition for existing assets.

'When there are good acquisition opportunities we will go for them. But if there are none, we're not going to cry. There are other things to do,' Mr Tan said in an interview.

A-Reit, Singapore's third-largest property trust by market value, currently has a portfolio of 78 business and industrial properties - valued at US$3.3 billion as of end-June.

But unlike rivals such as Mapletree Logistics, Cambridge Industrial and MacathurCook Industrial who position themselves as Reits based on regional industrial assets, its assets are all located in Singapore.

Mr Tan said A-Reit would continue to focus on the republic for growth since including overseas assets in A-Reit's portfolio would affect its cost of borrowing and change its risk profile.

The trust's main shareholder, Singapore government-owned Ascendas, last month listed Ascendas India Trust, a business trust based on Indian business parks.

'For markets such as India where you have the depth and width of potential, it's better to have separate geographically focused vehicles,' Mr Tan said. -- REUTERS