Wee Hur Holdings has recently made an important business decision, as they have entered into a binding agreement with Greystar to sell their portfolio of seven purpose-built student accommodation (PBSA) assets. This announcement was made in a press release on December 16.
The PBSA portfolio, which consists of more than 5,500 beds in various cities across Australia, has been sold for a purchase consideration of A$1.6 billion ($1.4 billion). Even after the transaction, Wee Hur will still retain a 13% stake through its subsidiary, Wee Hur (Australia).
In addition, the group plans to allocate the net proceeds from the sale, which is estimated to be around $320 million, towards their strategic growth initiatives, reinvesting in their core business, and expanding into new areas such as alternative investments.
The deal is expected to be completed within the next six months, subject to Greystar obtaining approval from the Foreign Investment Review Board (FIRB) and Wee Hur obtaining consent from its shareholders.
According to Wee Hur, this transaction is a testament to their resilience in navigating complex market conditions, including the challenges posed by the COVID-19 pandemic and greenfield developments. It also aligns with their long-term strategy of diversifying their portfolio and positioning themselves for sustainable growth in various sectors.
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CEO of Wee Hur Capital, Goh Wee Ping, states that this decision to sell their PBSA portfolio comes after their successful recapitalization with RECO in 2021/2022. As the PBSA market rebounds and their portfolio nears full stabilization, they saw this as an opportunity to unlock maximum value for their stakeholders through this significant transaction.