Abterra exercises option to buy office units

Abterra exercises option to buy office units

 

 

 

MINING and logistics company Abterra exercised an option from Park Central Investments to buy six office units in Suntec Tower One for $31.6 million on Friday last week.

 

 

The proposed acquisition of the 14,380 sq ft of space is scheduled for completion on Aug 28.

 

The property has 99-year leasehold tenure that expires in February 2088.

 

The price paid, which equates to $2,200 per sq ft (psf), took into account the current market value of Suntec Tower office units and the rental potential for portions Abterra may not use.

 

According to caveats filed on Suntec City office space, three offices have changed hands so far this year at $2,300 psf and one at $2,115 psf.

 

Abterra plans to move from its current premises in Shenton Way to the Suntec Tower units when the acquisition is complete.

 

‘As a result of the proposed move, the company will be able to stabilise its operating expenses and buffer against possible rental hikes incurred from an extension of the use of its current premises,’ it said yesterday.

 

‘Furthermore, the property has separate strata titles for the entire building … There are very few offices available for sale on a strata basis. Hence the company decided to acquire the property when the opportunity arose.’

 

The company has paid Park Central a deposit of 10 per cent of the purchase price. The balance will be funded externally and/or internally.

 

Abterra does not expect the proposed acquisition to have a material impact on the group’s financial performance in the current financial year.

 

Abterra shares closed half a cent lower at 8.5 cents yesterday.

 

Source: Business Times

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