Mapletree Investments selling 20 Harbour Drive for S$160 million

Citi Commercial Pte Ltd

MAPLETREE Investments is selling an eight-storey office building at 20 Harbour Drive to an entity linked to Keppel Education Asset Fund (KEAF) for S$160 million. 

A fully owned unit of Mapletree Investments entered into a put-and-call option agreement with the KEAF entity in late June.

The property is on a 138,835 square foot (sq ft) site with a tenure of 95 years and nine months which began in late December 2000. This leaves a balance term of about 72 years and three months.

Word in the market is that KEAF has been exploring the possibility of converting 20 Harbour Drive into an international school campus.

Located near Haw Par Villa MRT station, the property has an existing gross floor area of nearly 250,000 sq ft; there is potential to increase this, subject to approval by the relevant authorities.

The site is zoned for commercial use under the Urban Redevelopment Authority’s Master Plan.

JLL is understood to be brokering the sale of 20 Harbour Drive. The property consulting group conducted an expression of interest exercise to find a buyer for the property.

KEAF is a pan-Asia value-add education real estate fund. “Globalisation, coupled with rising wealth, rapid urbanisation, growing middle-income families and higher value placed on education, has driven strong growth in the private education sector,” stated the Keppel website.

The fund’s general partner, Keppel Education Asset Fund (GP), seeks to work with established education operators to capitalise on growing opportunities in the private education field in key cities in the Asia-Pacific region. According to the Keppel website, while the general partner “aims to achieve its target returns through deploying value-add real estate strategies for its investments, it would also seek to develop sustainable assets and campuses together with the school partners”.

“The general partner aims to create a balanced portfolio of stable, brownfield and greenfield assets with established operators in different education sub-sectors across different cities,” it added.

Mapletree, wholly owned by state investment firm Temasek, posted a net loss of S$577.2 million for the financial year ended Mar 31 amid industry headwinds, contrasting with a net profit of S$1.2 billion in the previous year.

The loss came as a high-interest environment led to expansion in real estate capitalisation rates in most markets, which in turn resulted in revaluation losses for the year, said the global property giant.

In late May, one of its sponsored real estate investment trusts, Mapletree Pan Asia Commercial Trust (MPACT), announced that it is divesting the 19-storey Mapletree Anson office building in Tanjong Pagar for S$775 million. The property is on a site with a remaining leasehold tenure of about 82 years and five months at the time of the announcement. The price reflected 3.8 per cent net property income yield. MPACT did not identify the buyer, which is Asia-Pacific alternative investment firm PAG.

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