No.1 Changi Business Park Avenue 1
Colliers International helped Ultro Technologies in maximising the value of their non-core asset and securing long-term usage of their facilities through a Sale & Leaseback structure.
Requirement
Colliers International was engaged to carry out negotiation on behalf of Ultro Technologies for the Sale & Leaseback of their Singapore headquarters in Changi Business Park with the fund manager of property trust, A-reit.
The development is a five-storey high tech industrial building located in the eastern part of Singapore.
Challenges
Colliers International's main challenge was to take over the current negotiation from the client, develop a good understanding of the issue and expedite the negotiation process with the fund manager. Colliers had to put in place a strategy to commence new negotiations to facilitate both the sale and the lease components of the deal.
Given that Sale & Leaseback structure was a new phenomenon in Singapore's property scene then, Colliers faced many obstacles and challenges along the way in trying to meet the expectations of both Ultro Technologies and A-reit.
Result
Ultro Technologies was able to achieve a premium sale price of S$18 million. The price was almost impossible in the then weak market condition and it recorded a 50% profit on construction costs. The sale has removed the company's non-core & non income-producing asset from their balance sheet and improved their cash flow by freeing up cash to grow their core businesses.
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