By The Edge Singapore

The manager of Prime US REIT has announced that the private placement launched on June 24 has raised gross proceeds of US$80 million ($107.5 million).

The placement saw 98.77 million new units issued at 81 US cents per unit. The price range at launch was between 79.7 US cents to 82.2 US cents. 

The upsize option of the placement for a further US$20 million was not exercised. 

The placement proceeds will be used to partially fund the acquisition of office towers in San Diego and Boca Raton, Florida. 

The issue price represents a 3.4% discount to the adjusted volume-weighted average price of 83.85 US cents per unit. The listing of the new units on the SGX-ST is expected to commence on July 5. 

According to the manager, the placement was more than two times subscribed, with demand from existing and new investors. Institutional investors accounted for over half the demand and final allocations. 

“We are pleased to deliver on our growth objectives through these accretive acquisitions of high-quality assets that enhance Unitholders’ value. We were uncompromising in our selection of assets to enhance our portfolio exposure to secular trends in growth cities, key sectors and quality assets. This benefits unitholders in the form of added income resiliency and portfolio diversity,” says Barbara Cambon, CEO and chief investment officer of the Manager. 

The deal structure was strategic and deliberate, with a view to balancing DPU accretion to our existing unitholders whilst maintaining a strong capital structure to position PRIME favourably for future acquisition opportunities. Overall, the acquisitions add visibility to our organic growth prospects and will enhance the returns that we continue to deliver to all stakeholders for the long-term, in a disciplined and prudent manner,” she adds.

Units in Prime US REIT closed at 88 US cents on June 23 before trading was halted on June 24. Trading of the REIT’s units resumes today.