WHA Premium Growth Freehold and Leasehold Real Estate Investment Trust (WHART) plans a third capital increase to invest in four projects worth a combined 4.5 billion baht.
Piyapong Pinthuprapa, chief executive of WHA REIT Management, the fund manager for WHART, said the trust plans to increase capital by issuing 229.18 million shares through a rights offering, which is a group of rights offered to existing shareholders to purchase additional stock shares in proportion to their existing holdings.
The unit price has not been settled yet.
Piyapong Pinthuprapa
WHART plans to borrow around 1.7 billion baht from financial institutions to invest in new assets worth 4.46 billion baht in total, said Mr Piyapong.
New asset purchases include two projects of WHA Corporation Plc (WHA), a joint venture project between WHA and Central Pattana Group, and another joint venture between WHA and KPN Group.
The new assets comprise of WHA Mega Logistics Center project on Rama II Road, Central WHA Mega Logistics Center, WHA KPN Mega Logistics Center on Bang Na-Trat Road KM23, and DSG HSIL in Saraburi province.
For these four projects, WHART will increase its rental space by 156,534 square metres on 172 rai of land.
After investment in the four projects is completed, WHART's total assets will increase to 32.8 billion baht from the current 28.19 billion.
Warehouse and factory rental spaces would increase to 1,128,000 sq m from 971,000 sq m.
Mr Piyapong said 86% of new assets are warehouse projects that are characterised as built-to-suit projects, with investment contracts of at least five years. Average rental contracts of these new assets are 7.5 years, which help to reduce occupancy rate volatility over the long run.
The other 14% of new assets are designated as general warehouses.
WHART's occupancy rate stands at 94%, with the high level attributed to long-term rental contracts and a built-to-suit strategy.
The fund plans to increase new investments by around 150,000 sq m per year, with an investment sum worth 4-5 billion baht.
WHART's asset size is projected to rise to 40 billion baht in two years, with asset size registering annual growth of 11-12%.
The fund's average annual return for the past two years was 6-7%, but the built-to-suit parts generated a return of 8-10%, said Mr Piyapong.