18 Aug 2014

Link Acquires Lions Rise Mall for HK$1.38B

The Link Management Limited, as the manager of The Link Real Estate Investment Trust (“The Link REIT”; Hong Kong stock code: 823), today announced that by the Sale and Purchase Agreement dated 18 August 2014, The Link REIT (through its special purpose vehicle Link (LRM) Limited as purchaser) agreed to acquire the Commercial Development, Signage Areas and Commercial private car and motor cycle parking spaces of Lions Rise Mall (the “Property”) for HK$1.38 billion.
George Hongchoy, Chief Executive Officer of The Link Management Limited, said, “This acquisition, our third since IPO, fits well with our strategy in acquiring properties offering synergy with our existing portfolio, and enhances our position as a leading investor and manager of retail properties in Hong Kong. Situated near Wong Tai Sin MTR station, this quality new asset commands a strategic location within a strong catchment area in East Kowloon with good transport accessibility. It complements our portfolio in the Wong Tai Sin District, where we have been serving customers for many years through our flagship properties, Wong Tai Sin Plaza and Lung Cheung Plaza, both a short walk from the Property.”
Lions Rise Mall is located at 8 Muk Lun Street, Kowloon, Hong Kong. Completed in 2012, the Property is part of Lions Rise, an estate consisting of five residential blocks on top of the podium. The Property has a gross floor area of approximately 126,319 square feet. As at 30 July 2014, the Property was approximately 84% let, with 36 tenancies and various licenses delivering a monthly rental income of approximately HK$2.8 million (excluding management fees but including car park income). The Property’s diversified tenant base includes supermarket, various food and beverage outlets (including Chinese restaurants, speciality restaurants and cafes), foodstuff, fashion, healthcare products, beauty, household goods and services.
According to the valuation report by CBRE Limited, an independent property valuer, the Property had an appraised value of HK$1.32 billion as at 13 August 2014, and the Property’s estimated monthly rental income (if 100% occupied at market rent) is expected to be approximately HK$4.7 million (excluding management fees but including car park income).
“Apart from leveraging on our leasing and property management capabilities to deliver a more appealing shopping experience, the Property offers the potential to achieve full occupancy and capture higher spending on subsequent lease cycles. It will also potentially benefit from various upcoming residential developments in nearby areas, notably the Tai Hom Village project and those along the planned Shatin-Central Link.”
“We are delighted to have entered into this transaction with Kerry Properties Limited, a leading and reputable property developer, investor and manager in Hong Kong, The People’s Republic of China and the Asia Pacific region. Given our strong financial position and fund-raising capability, we are well-placed to add value to our portfolio and grow our business inorganically through yield-accretive investments. We continue to seek acquisition opportunities in the mid to upper-mid market segment in Hong Kong. With our investment mandate recently extended to invest outside Hong Kong, we are also exploring investment opportunities in first-tier Mainland cities to further our mission of serving and improving the lives of those around us,” said Mr Hongchoy.
The acquisition will be funded by The Link REIT’s own cash resources and/or existing debt facilities and is not expected to have any material impact on its financial position. Completion of the acquisition is expected to take place on 18 September 2014.
The Link Management Limited will engage tenants, nearby residents and other stakeholders in communication to keep them informed on matters relating to the transfer of ownership of the Property.
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