Macquarie buys Singapore office for $S1bn

GLOBAL private equity group Macquarie Global Property Advisors has bought the landmark Temasek office building in Singapore from CapitaLand for $S1.04 billion ($A850 million).

Temasek Tower is a 52-level, A Grade office building located in Shenton Way which has a net leaseable area of approximately 670,200 sq ft and over 600 car park lots located in three basement levels.

The major tenants include the Singapore Land Authority, The Ascott Group, CapitaLand Residential, CapitaLand ILEC, Commerzbank Aktiengesellschaft and Bain & Company SE Asia, Inc.

The property has been acquired on behalf of MGP Fund II which closed in September 2005 with equity commitments of $US1.3 billion.

This is the second acquisition the fund has made in Singapore, having acquired 12 floors in Springleaf Tower in December 2006.

CapitaLand will gain about $S427 million from the sale from its 90.04% interest in Temasek. As at end 2006, Temasek Tower was carried in CapitaLand’s books at $S525 million.

CapitaLand’s chief executive Liew Mun Leong said the sale is in line with CapitaLand’s asset productivity strategy.

“After careful review of all the options including redevelopment, and given the current market conditions, we believe this is the right time to monetise Temasek Tower. We will redeploy the proceeds to invest in opportunities and projects in our various businesses which could generate even higher returns for our shareholders,” he added.

Temasek Tower is a leasehold asset with a term of 99 years commencing from July 19, 1982. Enhancement works are currently underway and slated for completion in the first quarter of 2008.

The completion of the transaction is scheduled to take place by April 2007.

Australian Property Journal