Suntec Real Estate Investment Trust is exercising an option to buy the remaining 50% interest it does not already own in the Southgate Complex in Melbourne from DEXUS for A$154.6 million.
The option carried a A$289 million price tag when the deal was first signed in August 2016, during which the Singaporean REIT paid the same amount for a 50% interest in the property. The REIT added that based on the latest open market valuation for the property, Southgate Complex is worth A$666.1 million and the stake it is now planning to buy is valued at about A$333.1 million.
Suntec REIT said the transaction supports its growth strategy, provides enhanced income and geographical diversification, and it added that the property has substantial value-add opportunities.
Southgate Complex features two office buildings, a three-story retail podium and a 1,026-lot car park. It stands on a roughly 20,800-square-meter freehold site along the Yarra River in the Southbank precinct of Melbourne.
The acquisition will be funded completely by debt, according to a filing.
