The divestment is part of the manager’s proactive portfolio management strategy and is in line with its objective to unlock value in Paragon REIT’s portfolio. The valuation of the Property was $62 million as at Dec 31, 2023. The net proceeds from the divestment will be deployed to pare down outstanding debt obligations, finance potential acquisitions and asset enhancement initiatives, and/or make distributions to unitholders.
The manager of Paragon REIT announced that it has entered into a sale and purchase agreement for the divestment of The Rail Mall for a cash consideration of $78.5 million, which was arrived at on a willing buyer willing seller basis taking into account the projected net property income of the property, the retail market outlook and the property yield. The announcement did not disclose the identity of the buyer.
The Rail Mall is a strip mall with 43 shop units and its adjacency to the iconic Rail Corridor nature trail also serves as a dining option for hikers and cyclists. The property has a total net lettable area of 49,886 sq ft.
