Record Realty Trust to Offload $2.1 Billion in Commercial Property Assets

The Directors of Record Funds Management Limited (RFML) as Responsible Entity of Record Realty Trust announced the commencement of a targeted three year asset realisation program worth approximately $2.1 billion on March 28, 2008.

In a statement, Allco company secretary Tom Lennox said selected asset sales will be targeted over the immediate term to reduce gearing levels and address potential debt covenant and liquidity pressures.

The properties targeted for immediate sale include the US and German portfolios consisting of 22 properties leased to the US Government and 8 properties leased to Deutsche Telekom, the ASX Building in Bridge Street Sydney, the Centrelink building in Canberra; 1 Spring Street Melbourne and 126 Margaret Street Brisbane.

Based at asset realisations at 31 December 2007 valuations, the proposed RRT sales would generate approximately $2.1 billion, delivering net proceeds of around $316.6 million, after the repayment of asset level debt of $1.7 billion and corporate level debt of $150.8 million.

Mr Ian Schilling, fund manager of RRT said "this plan is in the best interests of unitholders in light of the current market conditions and follows a comprehensive review of a range of potential models."

He said only a small number of the initial asset sales targeted over the immediate future will need to be executived, to alleviate potential RRT debt covenant and liquidity pressures.

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