FCT To Pay Up To $170.5m For Northpoint 2

Source : The Business Times, October 23, 2007

It will acquire the upcoming shopping mall from its parent firm in Q4 2008

FRASERS Centrepoint Trust (FCT) has entered into a put and call option agreement to acquire the upcoming shopping mall Northpoint 2 for between $139.5 million and $170.5 million, it said yesterday.

The mall, which is being developed by Frasers Centrepoint, will be completed by August 2008. FCT will then acquire it from its parent company in the fourth quarter of 2008.

Mr Tang: FCT is entering the put and call option agreement to acquire the retail centre now so that it can obtain a certainty of ownership

'We are doing this (entering the put and call option agreement) now so that we can get a certainty of ownership,' said Christopher Tang, chief executive of FCT's manager.

Related Link -
http://tinyurl.com/2xde9b
Frasers Centrepoint Trust's press release

http://tinyurl.com/2e3mua
Financial statements

FCT has plans to integrate the upcoming mall with Northpoint, which is already part of its portfolio.

The $30 million asset enhancement programme is expected to be completed by end-June 2009. Together, the two malls will have a combined net lettable area (NLA) of some 232,000 sq ft, an increase of some 56 per cent over Northpoint's current NLA.

FCT said that the mid-point of the agreed price range for Northpoint 2 - $155 million - is based on an open market valuation. The actual purchase price will be determined by taking the average of two valuations - one each by FCT and Frasers Centrepoint - nearer to the time of the transaction.

FCT also reported its financial results for the fourth quarter ended September 30, 2007 yesterday.

The trust said that distributable income for the three months came to $10.3 million, 13.5 per cent higher than the forecast of $9.1 million as new and renewed leases as well as higher occupancy rates in its malls contributed to increased revenues.

Distribution per unit (DPU) for the quarter came to 1.67 cents, up 13.6 per cent from forecast of 1.47 cents.

Net property income came to $12.8 million, some 2.6 per cent higher than the forecast of $12.5 million.

For its full financial year, FCT reported distributable income of $40.4 million, 11.1 per cent higher than its forecast. DPU came to 6.55 cents, 12.0 per cent higher than forecast. And full-year net property income came to $51.7 million, 3.2 per cent higher than its forecast.

There are no comparable figures for the previous corresponding periods as FCT was only listed on July 5 last year.

FCT has three more Singapore malls awaiting injection into the Reit - Yew Tee Point, Bedok Mall and The Centrepoint.

Yew Tee Point will be injected in early 2009 and Bedok Mall in 2010, Mr Tang said. He added that there is no timeline at present for Centrepoint's injection. The four malls together will double the trust's current portfolio.

The trust will also look at China and Australia for growth together with Malaysia, where it already has a presence through its stake in Hektar Reit, Mr Tang said.

FCT's shares closed unchanged at $1.50 yesterday.