First REIT To Restructure Master Lease Agreements Of Indonesian Hospital Assets
December 1, 2020 – First REIT announced that it has entered into a memorandum of understanding to restructure the master lease agreements of the 11 hospitals which PT Lippo Karawaci Tbk (LPKR) eases from First REIT.
Separately, First REIT also signed a memorandum of understanding with PT Metropolis Propertindo Utama (MPU) to restructure the master lease agreements of the 3 hospitals which MPU also leases from First REIT.
The master lease agreements in respect to Siloam Hospitals Surabaya, Siloam Hospitals Kebon Jeruk, Siloam Hospitals Lippo Village, being the hospitals that were leased to LPKR at the time of First REIT’s initial public offering in December 2006, will expire in December 2021.
First REIT Management Limited, in its capacity as manager of First REIT, has been engaging with LPKR on the renewal of these master lease agreements since 2019.
Under the Proposed LPKR master lease agreements Restructuring, the term of all of the LPKR master lease agreements will be extended to 31 December 2035, with an option for a further 15-year term by mutual agreement.
The rental under all of the restructured LPKR master lease agreements will be the higher of either the base rent or the variable rent.
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