CapitaLand Ascendas Reit has announced its plans to acquire DHL Indianapolis Logistics Center, a premium logistics property, from DHL USA for a proposed price of $150.3 million. This acquisition will be at a 4.1% discount to the market value of the property as of January 1, 2025. After factoring in all related expenses such as fees and acquisition costs, the total cost of this transaction is expected to come to $153.4 million.
To finance this acquisition, the company intends to use internal resources, divestment proceeds and existing debt facilities. This will be done in accordance with the plan outlined in the press release issued on December 17. Following the acquisition, DHL USA will continue to occupy the property for a long-term period until December 2035. They also have the option to renew the lease for an additional two five-year terms. This steady and extended stream of income will provide stability to CapitaLand Ascendas Reit’s (CLAR) portfolio and enhance its resilience.
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The property in question, located in Whiteland, a submarket in southeast Indianapolis, Indiana, is a fully air-conditioned, single-storey logistics building covering a gross floor area of 979,649 square feet. With a long lease term and high occupancy rate, this property is expected to increase the value of CLAR’s logistics assets under management (AUM) in the US by 35.3% to $587.5 million. This also expands CLAR’s logistics footprint in the US as it adds to the existing 20 properties across four cities, covering a total gross floor area of 5.1 million square feet.
According to William Tay, executive director and CEO of the manager, this acquisition is a strategic fit for CLAR’s portfolio and the first sale and leaseback acquisition in the US. With the addition of this Class A logistics property, modern logistics assets will now account for 42.3% of the company’s US logistics AUM. This property brings in a long-term lease and will further enhance the company’s steady income stream, contributing positively to its long-term returns.