SINGAPORE (THE BUSINESS TIMES) – IReit Global has, through its wholly owned subsidiary Fit 2, entered into a conditional sale agreement to acquire Decathlon’s properties in France for €110.5 million (S$176.8 million).
The portfolio comprises 27 retail properties with a gross lettable area of 95,477 sq m.
Upon completion, all properties will be leased back to the sporting goods retailer. The deal comprises a committed occupancy of 100 per cent with weighted average lease expiry by gross rental income of 10 years, said the manager on Wednesday.
According to a bourse filing, the acquisition will be partially financed through equity fund-raising, which may comprise a private placement of new units to investors and/or a non-renounceable preferential offering to existing unit holders. The final funding structure will be ascertained “at the appropriate time”, said the manager.
The manager also said that key investors have provided an undertaking to subscribe in full to their allotment in a preferential offering, which including excess units, sums up to about $59 million.
Making its first foray into France, the trust expects the acquisition to strengthen its portfolio and reduce its reliance on any single geographical location or trade sector. IReit’s current portfolio comprises office properties in Germany and Spain.
It also hopes to leverage Decathlon’s large footprint in the “resilient” sporting goods industry as well as France’s gross domestic product growth, which the trust expects to outpace that of the rest of Europe.
The acquisition is expected to be completed by the third quarter of 2021, subject to unit holders’ approval.