Nan Fung Plaza is located opposite to the Hang Hau MTR Station in Tseung Kwan O district, New Territories. The property was completed in 1999 and is connected by footbridges to The Link REIT’s Hau Tak Shopping Centre in the Hang Hau area of Tseung Kwan O district.

 

The commercial podium of Nan Fung Plaza has a total gross floor area of approximately 176,000 square feet and currently consists of over 200 retail shops delivering aggregate rental income of approximately HK$4.07 million per month. Taking into account the latest agreed new leases and lease renewal, the aggregate monthly rental is estimated to amount to approximately HK$4.21 million providing a rental yield of 4.3% based on the purchase price. Completion of the acquisition is expected to take place in July 2011.

 

Mr George Hongchoy, Chief Executive Officer of The Link Management Limited, said, “Apart from being the first acquisition since our initial public offering in 2005, owning Nan Fung Plaza’s commercial podium is our first venture in managing a retail facility that is part of a private-sector residential development.  This signifies a new horizon of growth for The Link REIT. Through on-going asset enhancement of The Link REIT’s existing 180 properties, we have been adding value to our stakeholders and growing returns to the Unitholders. With this new acquisition, we are stepping up our strategy by adding another quality income-producing property to our portfolio.”

 

“The combination of the property with our nearby Hau Tak Shopping Centre will create synergy and enhance the growth potential of both properties. We believe that this will not only be yield-enhancing for Unitholders, but also leverage on our expertise in retail property management to bring about more business opportunities for retailers and better shopping environment for shoppers from the nearby areas,” added Mr Hongchoy.

 

"The Nan Fung group, the vendor and developer of this property, is a leading and reputable developer in Hong Kong. We are pleased to have done this deal with them, and look forward to more opportunities to work with them, should suitable opportunities arise in future,” said Mr Hongchoy.

 

The acquisition will be funded by The Link REIT’s own internal resources and existing debt facilities. The acquisition is not expected to have any material impact on the financial position of The Link REIT. Payment of the consideration and the associated expenses will not affect the amount of final distribution declared in the 2011 Final Results Announcement.

 

The Link Management Limited will engage retailers, nearby residents and other stakeholders in communication to keep them informed on matters relating to the transfer of ownership of the property.