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CapitaLand set to buy Asia Square Tower 2 – Exclusive

The Singaporean firm is in exclusivity to acquire the second and final tower from BlackRock’s two tower-development scheme in Singapore, sources have confirmed to PERE.

The Singapore-headquartered real estate developer and fund manager CapitaLand is understood to be in exclusivity to acquire Asia Square Tower 2 from BlackRock, PERE has learned.

According to sources familiar with the transaction, the price that CapitaLand has agreed to pay for the 46-story prime commercial building in Singapore’s Marina Bay district is in excess of S$2,700 ($1922; €1792) per square foot.

BlackRock declined to comment on the news while CapitaLand could not be reached for comment as of press time.

Tower 2, comprising offices and the Westin hotel, is currently believed to be over 90 percent occupied.

The deal, once officially announced, will mark the end of the sales process of BlackRock’s two-tower development scheme that represented the lion’s share of the gross asset value of BlackRock Real Estate Fund III, Asia’s largest private equity real estate fund when it closed on $3.9 billion of equity commitments in 2008.

Asia Square Tower 1 was sold to the Middle Eastern investor Qatar Investment Authority for approximately S$3.4 billion in June last year, becoming one of the largest single-asset property transactions in Asia Pacific at the time.

As part of the deal, QIA was also granted the right of first refusal to acquire the Tower 2 when it was brought to the market.

CapitaLand had also been among the bidders pursuing Asia Square Tower 1 in 2015, a list that included ARA Asset Management and Norges Bank Investment Management (NBIM).

However, the Singaporean firm eventually went on to pull out of the bid in November, 2015. While no official reasons were cited by CapitaLand, sources had told PERE at the time that there were some concerns with regards to certain representations and warranties within the contract to buy the asset.

Arshiya Khullar contributed reporting.