Daiwa House Logistics Trust has launched its maiden acquisition following its IPO last November, with plans to buy two freehold logistics facilities and a piece of freehold land in Japan from sponsor Daiwa House Industry for 4,68 billion yen, or $47.7 million.
According to DHLT, the blended implied NPI yield for these two properties is 6.5%, which is higher than the blended NPI yield of the existing properties in DHLT's portfolio of 6.1%.
The purchase price is at a discount of 11.8% off the appraised value of $54.1 million of these properties as at June 30.
DHLT plans to fund the acquisition by a mix of bank borrowings as well as the subscription of new units worth 1.25 billion yen in DHLT by the sponsor.
The subscription price of the new units will be the higher of either the 10-day VWAP of DHLT, or at least 77 cents per unit. At this price, it is a premium of 14.9% to DHLT’s closing price of Sept 20. It is also equivalent to the net asset value of DHLT as of June 30. Or,
According to DHLT, this commitment is a signal of the sponsor’s “strong commitment and support” towards the REIT’s growth and continued development.
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The properties to be acquired are DPL Iwakuni 1 & 2, and D Project Matsuyama S, plus the underlying freehold land of D Project Iruma S, an existing property in the portfolio of DHLT.
The buildings are fully occupied as at June 30, leased to tenants such as one of the largest integrated logistics companies in Japan, as well as a leading integrated food trading company in Japan which also provides 3PL services.
Takeshi Fujita, CEO of the manager, says the acquisition will help lift DPU by 1.3% on a pro forma basis, and will enhance the quality of its portfolio.
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“Amidst challenges in the macro environment, we observed that logistics properties in Japan have remained resilient, while demand for logistics space is expected to remain healthy,” he says.
DHLT closed at 67 cents on Sept 21, unchanged for the day, but down 16.25% from its IPO price of 80 cents.
