The principal investment strategy of a-iTrust is to own income producing real estate used primarily as business space located in India and real estate-related assets in relation to the foregoing. a-iTrust may acquire, own and develop land primarily or uncompleted developments to be used for business space with the objective of holding the properties upon completion. Certain key provisions of the Property Funds Guidelines which govern REITs have been voluntarily adopted by a-iTrust and incorporated into the Trust Deed.
The Trustee-Manager’s key objectives are to deliver regular and stable distributions to Unitholders and to achieve long-term growth in the net asset value per Unit. The Trustee-Manager plans to achieve these objectives through the following key strategies:
(A)
Three-pronged external acquisitions growth
Achieve
portfolio growth through a broad-based external acquisitions growth
strategy supported by an identifiable acquisition pipeline and rights
of first refusal from Ascendas and Ascendas India Development Trust;
Unique growth model comprising organic growth, an “in-built” development pipeline on
existing land within its property portfolio and the Trustee-Manager’s three-pronged external
acquisitions strategy
The Trustee-Manager's three pronged external
acquisitions growth strategy
(I)
Ascendas India Development Trust ROFR
(II)
Ascendas ROFR
(III)
Third Party Acquisitions
•
Right of First Refusal from Ascendas India Development Trust over income-producing business space properties located in India which it is proposing to sell or acquire
•
Current committed capital of S$500 million and a targeted investment value of S$1 billion
•
About 10m sqf business space development potential in key cities such as Gurgaon, Pune and Coimbatore
•
Right of First Refusal from Ascendas over Income-producing business space properties located in India which it is proposing to sell or acquire
•
Ascendas currently owns The CyberVale in Chennai, an IT SEZ
•
Income-producing business space properties and/or partially completed development projects across India which satisfy a-iTrust's investment criteria
Ascendas India Development Trust’s Right of First Refusal
The Development Trust has granted to a-iTrust the Development Trust Right of First Refusal over the future proposed sale or acquisition by the Development Trust of income-producing properties used primarily for business space in India. The Development Trust Right of First Refusal is expected to secure a proprietary future acquisitions pipeline for a-iTrust.
Ascendas Right of First Refusal
Ascendas has also granted a-iTrust its Right of First Refusal over the future proposed sale or acquisition by Ascendas or its subsidiaries (each a “Relevant Entity”) of income-producing properties used primarily for business space in India. Ascendas currently owns The CyberVale in Chennai, an IT park comprising a proposed 1.1 million sq ft of SBA* over four buildings. The first building (250,000 sq ft of SBA) is completed. MindTree Consulting Limited (“MindTree”) has committed to a 99-year lease on the second building, a built-to-suit facility (280,000 sq ft of SBA). Development of the third building (280,000 sq ft of SBA) and the fourth building (proposed 280,000 sq ft of SBA) is being planned. Accordingly, Ascendas' Right of First Refusal will not include the second building at CyberVale.
Also, in the case of unlisted funds in which a Relevant Entity participates but has no control over the fund’s investment decisions, Ascendas is not in a position to grant a right of first refusal to a-iTrust.
*Super Built-Up Area
Third Party Acquisitions
The Trustee-Manager will also actively source quality third party income-producing business space properties and/or partially completed development projects across India which satisfy its investment criteria.
(B)
Portfolio growth through in-built development pipeline
Phased expansion of income-producing portfolio through a strong development pipeline of up to 4.2 million sq ft on land owned and paid for by a-iTrust, comprising:
—
1.7 million sq ft SBA of ongoing developments.
—
2.5 million sq ft SBA or 23 acres of land available for development.
(C)
Active management of assets
Actively managing a-iTrust’s income-producing portfolio to achieve organic growth and maximise returns on the portfolio:
—
Conversion of under-utilised space into additional income stream and provide additional amenities and services for tenants.
—
Repackaging and retendering of maintenance and insurance contracts to minimise costs and optimise economies of scale.
(D)
Capital and Risk Management
Maintain strong balance sheet and adopt appropriate financing and hedging policies to manage interest rate volatility and foreign exchange exposure:
—
Listed with low initial gearing ratio to maintain financing flexibility in view of intended developments to be executed within the portfolio.
—
Utilise a combination of Indian Rupee and Singapore Dollar-denominated debt in a manner which minimises net financing cost.
—
Hedge distributable income as they are earned with a series of forward foreign exchange contracts, to provide visibility of distribution to Unitholders.
