Cache Logistics Trust (CACHE) announced that it has entered into a sale and purchase agreement to acquire a modern single-storey warehouse (with two levels of ancillary office) located at 203 Viking Drive, Wacol, Queensland, Australia. The purchase consideration is A$27.0m (~S$27.1m), and will be funded fully by debt. This would raise CACHE’s aggregate leverage ratio from 38.0% to 39.4%.

The asset sits on freehold land, has a gross lettable area of 13,363 sqm and is CACHE’s fourth acquisition in Australia following its purchase of three distribution warehouses in Australia earlier this year. Upon completion of the acquisition, CACHE will lease the property to Western Star Trucks Australia Pty Ltd on a master lease until Aug 2023, with an annual rental escalation of 4%. Maintain HOLD and S$1.00 fair value on CACHE.

Source: OCBC Research - 12 Oct 2015