Following my previous post on news that Cambridge Industrial Trust has taken up a 100 million loan (Cambridge Industrial Trust 100 Million Loan), Soilbuild Business Space REIT has announced on 21st September 2016 that they have taken up a S$45 million loan. The loan comprises of S$40 million term loan and S$5 million revolving loan facility. The S$45 million loan was from Bank of East Asia (BEA).
As indicated previously in my post on Cambridge Industrial Trust, there should be two questions we need to ask ourselves.
- Did the REIT run into debt?
- Is the REIT expanding or acquiring new property?
As we all know, Soilbuild Business Space REIT is acquiring the Bukit Batok Connection. Thus, the S$40 million loan is used by Soilbuild Business Space REIT to fund the acquisition. This is on top of the S$59.4 million Soilbuild REIT is raising through preferential offering (Soilbuild Launches Preferential Offering to fund Bukit Batok Connection Acquisition).