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Tuesday, November 30, 2010

Cambridge completes acquisition of 511 and 513 Yishun Industrial Park A - 30 NOV 2010

Cambridge completes acquisition of 511 and 513 Yishun Industrial Park A.
Key Points
  • Completion of the acquisition of the property located at 511 and 513 Yishun Industrial Park A, Singapore 768768 and 768736 respectively.
  • Use of proceeds from the private placement and preferential offering of S$21.8 m for part payment of the purchase price for 511 & 513 Yishun Industrial Park A and estimated acquisition costs.
Related Posts


Monday, November 29, 2010

Starhill Gbl, MapleTreeLog Updated Target Price

Starhill Gbl, MapleTreeLog Updated Target Price:
Starhill Gbl Kim Eng BUY 0.800 25/11/10
MapleTreeLog OCBC BUY 1.000 23/11/10

Latest updates at Stock Target Price.


Suntec Reit successfully raised S$428.8 million through private placement - 29 NOV 2010

Suntec Reit successfully raised S$428.8 million through private placement:
Key Points
  • Private placement of 313 million new units in Suntec REIT have been fully subscribed at an issue price of S$1.37 per New Unit. 
  • The Issue Price represents a discount of 4.02% to the volume weighted average price of S$1.4274 per unit in Suntec REIT and 2.88% to the adjusted volume weighted average price of S$1.4106 per Unit for trades done for the full market day on 26 November 2010.
  • The net proceeds from the Private Placement which amount to approximately S$417.9 million will be used to partially finance the acquisition of a one-third interest in Marina Bay Financial Centre Towers 1 and 2 and the Marina Bay Link Mall. 
  • The Manager has on 26 November 2010 obtained the approval of unitholders of Suntec REIT at an extraordinary general meeting for the Acquisition.
  • In connection with the Private Placement, existing Unitholders will be entitled to receive a distribution income for the period from 1 October 2010 to the day immediately prior to 9 December 2010, being the expected date on which the New Units are issued pursuant to the Private Placement. 
  • The New Units are not entitled to the Advanced Distribution. 
Author's Note
The book closure for the advanced distribution will be at 5.00 p.m. on 8 December 2010. The actual quantum of the distribution per Unit under the Advanced Distribution will be announced at a later date. The next distribution thereafter will comprise Suntec REIT’s distributable income for the period from the day the New Units are issued (9 December 2010) to 31 December 2010. Quarterly distributions will resume thereafter.

Earlier part of the day the manager has announced the private placement with the range of issue price between S$1.34 and S$1.38 per New Unit. The final issue price S$1.37 is towards the top of the range. The Private Placement was 3.1 times oversubscribed.

Related Posts


MapletreeLog Expands Singapore Portfolio with Acquisition of Liang Huat Building - 26 NOV 2010

MapletreeLog Expands Singapore Portfolio with Acquisition of Liang Huat Building.
Key Points
  • The Manager of MapletreeLog has signed a Sale and Purchase agreement and completed the acquisition of the Liang Huat Building at 51 Benoi Road, Singapore at a purchase price of S$55 million.
  • The Property comprises six blocks of industrial warehouses, including two ancillary buildings. 
  • Strategically located in the Jurong area near the Joo Koon MRT station, it is also well-connected to the Ayer Rajah and Pan Island Expressways.
  • The acquisition provides an initial net property yield of 7.8%.
  • The vendor, Khai Wah Development Pte Ltd, is a wholly owned subsidiary of Ho Lee Group Pte Ltd (“Ho Lee Group”).
  • Currently, 40% of the Property is occupied by companies within the Ho Lee Group while the balance is leased to third parties.
  • The vendor will provide rental income guarantee for existing leases that are
    deemed to be below that of the market in the vicinity. 
  • The rental guarantee has a yearly escalation of 2% for a period of 5 years. 
  • Outgoings such as land rent, property tax and property maintenance of this multi-tenanted facility will also be borne by the vendor during this period.
  • With the addition of this Property, MapletreeLog’s total portfolio will increase to 94 properties with a book value of approximately $3.4 billion.
  • This acquisition is funded with the proceeds from the recent equity fund raising exercise announced on 21 September 2010 (“EFR Announcement”). 
  • This acquisition was one of the four potential acquisitions identified in the EFR Announcement and the second acquisition of the four to be completed.
Related Posts



Sunday, November 28, 2010

All about REIT - The IPO Prospectus

In recent weeks we have seen an increase in the number of companies going for IPO. The most notable ones being that of Global Logistics Properties (GLP) and Mapletree Industrial Trust (MIT), which are linked to GIC and Temasek Holdings respectively. Just last week, we were looking at the listing of Sabana Reit, the first Shari'ah Compliant Reit in SGX.

For an IPO, the main avenue for retail investors to access and evaluate a company will be the IPO prospectus. However, it is very unlikely for someone to read the whole IPO prospectus because it is usually a few hundred pages thick. For example, the IPO prospectus for Sabana Reit comes with a whopping 480 pages! So what shall we look out for in an IPO prospectus? I will be sharing here some of the main items I will look at in the IPO prospectus for a Reit. Though the sharing here is Reit-centric, I think most of the things should apply equally well for the IPO of normal companies. I shall use the IPO prospectus of Sabana Reit as a reference here.

Where to Find the IPO Prospectus
First and foremost is of course where to get hold of the IPO prospectus. I remember few years back when I was working near the SGX centre, I will frequently see a desk being placed outside, with a staff manning a few hundred copies of the IPO prospectus whenever there is an impending IPO. Thanks to the advent of technology, now we no longer need to go all the way to SGX centre to carry back the very thick prospectus. With the MAS Opera site, we can easily download the PDF copy of the prospectus through the internet. You can easily find the MAS Opera site by googling for the phrase "MAS Opera". The site should appear right at the top or near the top.

Once you are in the main page of the MAS Opera site, you should be able to see a category called "Collective Investment Scheme Offers". The IPO prospectus for Reits can be found under this category. This category also includes prospectus of Unit Trusts to be launched by Fund Houses. For normal companies you should look under the category "Share Offers".

Preliminary and Final Prospectus
When a company or a Reit has announced its intention for listing, it will usually lodge a preliminary IPO prospectus with the Monetary Authority of Singapore (MAS) first. When its nearer to the IPO date, the final prospectus will be lodged. There shouldn't be too much differences in the contents, except that the final prospectus should provide details of the important dates for the IPO, such as the subscription period and listing date. Both the Preliminary and Final Prospectus can be found in the MAS Opera site.

The Cover Pages
Without even going into the main contents IPO prospectus, the cover and the first few pages alone will usually give you a general idea about the company/Reit. For the Sabana Reit prospectus, it has provided in its cover pages the summary information about its IPO price, number of units to be issued, its nature of business, its strategies, the projected yield, the indicative timetable, etc.

Use of Proceeds
We should get some idea of what the proceeds raised for the IPO will be used for. Other than for acquisition of the initial properties from the Sponsor, sometimes it may also be used for initial debt payment, which is the case for Mapletree Industrial Trust.

For Sabana Reit, the details of the Use of Proceeds can be found in Pg 75. Most of the proceeds of about S$885 million will go into Acquisition of the Properties, with about S$34 million as transaction costs.

Projected Yield
The projected yield is a very important information for Reits and it will usually be provided in the prospectus, as it is mandatory for Reits to distribute at least 90% of its distributable income. The projected yield is calculated based on the IPO offer price of the Reit. For IPO prospectus of normal companies, this information may not be provided as some companies may be more focused on growth, and thus the dividend payout may not be that predictable.

In the Sabana Reit prospectus, the projected yield can be found in the cover pages, and more details are provided in the "PROFIT FORECAST AND PROFIT PROJECTION" section on Pg 36. The projected yields for Sabana Reit are 8.22% and 8.25% for 2010 and 2011 respectively, based on the issue price of S$1.05. This information can then be used to compare with yields of other Reits, preferably in the same sector, i.e. industrial Reits.

Initial Gearing
Sometimes comparing yield with other Reits alone is not sufficient. We should also compare the gearing. Gearing is defined as the debt over the total assets.
The gearing may not be provided in a standard section in the prospectus. You can search for key words like "Gearing" or "Aggregate Leverage" to find it.

For the Sabana Reit prospectus, the gearing or aggregate leverage can in fact be found in quite a number of places. One such place will be the section on "Capital structure that provides stability and future financing flexibility". Here the figure provided is 26.5%. This is lower than most of the industrial Reits, which are around 30 to 39%.

Sponsor
The sponsor of the Reit may not be something quantifiable like the yield or gearing, but it does give us an idea of how well the Reit can be supported in times of need. Market may give the Reit a premium by virtue of its sponsor. Most of the earlier Reits have sponsors that are either listed blue chip companies (Capitaland, Keppel Land) or government linked private companies (Mapletree Holdings). Recently we are seeing listing of Reits by smaller players such as CWT, sponsor of Cache Logistics Trust.

In the prospectus for Reits, there is usually a section about the Sponsor. For the Sabana Reit prospectus, it can be found on Pg 160. The sponsor of Sanaba Reit is Freight Links Group, a leading international total logistics solutions provider with a strong presence in Singapore and the Asia Pacific region. It is also listed in the SGX mainboard, though many may not be familiar with it before the IPO of Sabana Reit.

NAV per Unit
The NAV per unit is usually used to compare with the share price of the unit to determine how much it is in discount or in premium. The IPO price is usually higher than the NAV per unit. It may not be favourable if the price has too much premium over the NAV per unit. You may also need to compare with the market whether Reits are generally trading in premium or discount, and by how much.

For Sabana Reit the NAV per unit is S$0.99. This can be found in the section "UNAUDITED PRO FORMA BALANCE SHEET AS AT THE LISTING DATE" on Pg 35. The IPO price of S$1.05 is at about 6% premium.

Pro Forma Financial Statements
The Pro Forma statements will help you have a rough idea of how the Reit is going to be performing after IPO, like what is the net profit is going to be like based on the initial portfolio of properties. But you must take note of the assumptions made in the prospectus in coming out with the figures. The Reit may not perform as indicated in the Pro Forma statements as they are after all derived based on the assumptions made.

Others
Although the above figures and information are important to look at in the prospectus, it doesn't mean that other information is not important. If time allows, you should try to cover as much of the prospectus as possible. Items such as Risk factors are definitely worth a look in helping to evaluate the IPO. It will be good if you can look for external sources of information about the Reit and its sponsor, such as any analyst report about the IPO to get a better picture.

Now the above figures are primarily useful for comparing with Reits of similar nature in the market. They are not useful for predicting the opening price on the listing day, as that is usually sentiments driven. Personally I find that compared to normal companies, it is easier to gauge whether the price of a Reit has run up too much on listing day, as its yield cannot be too far off from its peers in the market.

Related Links
Related Posts


Thursday, November 25, 2010

SABANA REIT - Admission of 632,800,000 units to the Official List of SGX-ST

SABANA SHARI'AH COMPLIANT REIT - Admission of 632,800,000 units to the Official List of SGX-ST.

Press Release

Key Points
  • Admission of 632,800,000 units of Sabana Reit to the Official List of SGX-ST.
  • Trading in the units is expected to commence on "Ready" basis with effect from 2.00 p.m., Friday, 26 November 2010.
  • The short name is "Sabana REIT"and abbreviated name is "SABREIT".
Author's Note
The first Shari'ah Compliant Reit in SGX will commence trading tomorrow from 2.00 p.m. The counter is already available in the SGX website, with a code of M1GU.

Some of you may remember a couple of old news sometime back about plans for the first Shari'ah Compliant Reit in SGX. First was non other than Cambridge Industrial Trust. The manager was contemplating to convert the Reit into a Shari'ah Compliant Reit in early 2009. One of the reasons given was also about attracting investors from the Middle East. I remember there was even a report about the Reit being already more than 90% compliant. However, there was no subsequent follow-up about the plan. If it has gone ahead, Cambridge would have become the first Shari'ah Compliant Reit.

The other was a partnership agreement between ARA Asset Management and  Qatar-based Regency Group to jointly manage a Shariah-compliant REIT made up of mainly hospitality properties. It was announced at the end of 2009, and the plan was to list the Reit in the second half of 2010. Right now we are still in the second half of 2010, and there is still a possibility of the Reit being listed by 2010. Only thing is that with the listing of Sabana Reit, it will no longer be the first Shari'ah Compliant Reit as originally planned. But it will still be the first Shari'ah Compliant hospitality Reit (Sabana Reit is in the industrial sector). Anyway it remains to be seen whether these Shari'ah Compliant Reits will really be effective in attracting investments from the rich middle eastern countries.

Related Posts



First Reit - Notice of Rights Issue Books Closure Date

First Reit - Notice of Rights Issue Books Closure Date.

Press Release

This is further to the announcement dated 10 November 2010 about the rights issue exercise and acquisition of 2 properties in Indonesia.

Key Points
  • The book closure date will be on 3 December 2010 at 5.00 p.m. for the purpose of determining the provisional allotments of Rights Units of Eligible Unitholders under the Rights Issue.
  • Eligible Unitholders whose securities accounts with CDP are credited with Units on 3 December 2010 at 5.00 p.m. will be entitled to participate in the Rights Issue.
  • The Rights Issue exercise is subject to approval by Unitholders at the extraordinary general meeting of Unitholders to be held on Monday, 29 November 2010.
Related Posts


Tuesday, November 23, 2010

AIMSAMPI Reit Market Update - 23 NOV 2010

AIMSAMPI Reit Market Update. See press release.

Key Points
  • Sale of 23 Changi South Avenue 2 Singapore above book value.
  • Signing of three long term leases with high quality tenant at 23 Tai Seng Drive Singapore.
  • 100% occupancy achieved at 15 Tai Seng Drive Singapore.
Related Posts



FrasersComm, SUNTEC Updated Target Price

FrasersComm, SUNTEC Updated Target Price:

FrasersComm OCBC BUY 0.170 23/11/10
Suntec OCBC BUY 1.630 19/11/10

Latest updates at Stock Target Price.


Monday, November 22, 2010

A-Reit explores regional investment opportunities - 22 NOV 2010

A-Reit explores regional investment opportunities. See press release.

Key Points
  • A-REIT will be expanding its investment scope to cover the Asia region.
  • Currently, the Manager is actively exploring investment opportunities in China and has set up a representative office in Shanghai, China to enhance the Manager’s visibility in the various business space sub-segments and micro property markets.
  • A-REIT’s portfolio will remain predominantly Singapore-based assets in the foreseeable future.
Author's Note
To date, all the properties of A-Reit are located in Singapore. It is also the only S-Reit to date to have undertaken development projects. The scope of the development projects are also in Singapore, subject to a cap of 10% of its total asset value by MAS regulation. The positive point about the expansion of its investment scope will be more investment opportunities will be opened up, as there may be very limited opportunities left in Singapore. Its sponsor, Ascendas Pte Ltd, has a real estate portfolio that includes science, business and industrial parks in countries such as India, China, South Korea, Vietnam, Malaysia and the Philippines. These can be potential targets for injection into A-REIT in the future. Of course the move also subject the Reit to other types of risks, currency risk being an example.

Related Posts


Friday, November 19, 2010

Cambridge issues and list 38,483,354 new units pursuant to the preferential offering - 18 NOV 2010

Cambridge issues and list 38,483,354 new units pursuant to the preferential offering. See press release.

Key Points
  • This announcement is in relation to CIT’s equity fund raising comprising:
    • The private placement of 56,498,000 new units in CIT at an issue price of  S$0.531 per Placement Unit to raise gross proceeds of approximately S$30.0 million.
    • The pro-rata and non-renounceable preferential offering of 38,483,354 new units in CIT on the basis of one Preferential Unit for every twenty-five existing units in CIT held by Entitled Unitholders1 as at 5.00 p.m. on 29 October 2010, fractions of a Preferential Unit to be disregarded, at an issue price of S$0.531 per Preferential Unit to raise gross proceeds of approximately S$20.4 million.
  • The Manager wishes to announce that the issuance of the Preferential Units has been completed on 18 Nov 2010. With the issuance of the Preferential Units, the total number of Units in issue has increased to 1,057,065,216 Units.
Related Posts


Cambridge Notice of Advanced Distribution - 18 NOV 2010

Cambridge Notice of Advanced Distribution. See press release.

This is a follow up of the earlier announcement dated 21 October 2010 relating to the Equity Fund Raising and acquisitions.

Key Points
  • Distribution of the distributable income for the period from 1 October
    2010 to 17 November 2010 in advance.
  • Advanced Distribution of 0.627 cents per Unit in cash will be paid on 6 December 2010.
  • Unitholders whose securities accounts with The Central Depository (Pte) Limited were credited with Units as at 5.00 p.m. on 29 October 2010 will be entitled to the Advanced Distribution.
Related Posts


Monday, November 15, 2010

The Expanded First Reit Post Rights Issue and Acquisitions

First Reit has announced its proposed acquisitions of 2 Jakarta hospitals, and 5 for 4 rights issue on 9 Nov 2010, followed by more details on 11 Nov 2010. I have come across a couple of blog articles with the analysis of the rights issue and acquisitions in details, and have provided the links under the "Related Links" section below. I shall not be going through the numbers in details here, but will be taking a broader view of the whole exercise and also some additional points. Before that, for those who are new to First Reit, following are some background information.

Background
First Reit is a healthcare reit which has a portfolio of mainly hospitals and a hotel in Indonesia. It also owns some nursing homes and a hospital in Singapore. Its sponsor is the Lippo Group, which also co-sponsored the LippoMaple Indonesia Trust, an Indonesian retail reit, with Mapletree Pte Ltd, a fully owned subsidiary of Temasek Holdings. Following is a brief description of the Lippo Group:

"The Lippo Group is a major Indonesian conglomerate founded by its Chairman, Dr. Mochtar Riady in the 1950s. It consists of private and public companies in China mainland, Hong Kong and Macau; Indonesia, Philippines, Singapore and South Korea with US$11 billion in assets. Lippo Group has over 15 public-listed companies in different parts of Asia including Hong Kong, Indonesia and Singapore."

Developments Since 2009
First Reit has been rather quiet for the past 2 years. Other than some asset enhancement works, it has not undertaken any major moves such as acquisition of new properties that would have made significant impact on its DPU. Thus its DPU has been rather stable from quarter to quarter around 1.9 cents since 2009. Its stock price has also not been moving up as quickly as most of the other s-reits, and because of that its dividend yield has consistently been one of the top among the s-reits. Recently its share price has seen a very impressive surge, closing at a all time high of 0.980 cents on 8 Nov 2010, just a day before the release of the acquisitions and rights issue announcement. On 9 Nov 2010, the reit announced the proposed acquisitions of 2 Jakarta hospitals as well as a 5 for 4 rights issue. The details can be found under the "Related Posts" below.

What is the effect of the acquisition and rights exercise?
At first glance the whole exercise does not seem to be very favourable for the reit. The 5 for 4 rights issue is going to more than double the share base, and at a relatively cheap price of S$0.50. The gearing as at 30 Sep 2010 was 16.5%, which is at a very low level. Doesn't it make more sense to finance the acquisitions primarily by debt, with a smaller scale rights issue or private placement that is going to have less impact on the share base?

If we take a closer look at the total asset value of the reit as at 30 Sep 2010, we will find that there is very little room for the reit to borrow much without hitting the gearing limit. The total asset is only S$346.1m. To my knowledge, at the time of this writing First Reit does not having a rating by Fitch, Moody's or S&P, which means that it can only gear up to 35%. So financing primarily by debt will leave the reit with less choices as acquisition targets, as it can only look for acquisitions of smaller scale. Furthermore, even a smaller scale acquisition can easily drive up its gearing close to the gearing limit because of its low asset base.

The management may have wanted to make use of the recent positive reaction to equity raising exercises like rights issue, private placement and IPOs to undertake a larger scale equity raising, so that it will pave the way for future expansion plans. According to the press release on 11 Nov 2010. post acquisition and rights issue, the projected gearing is still at a low level of 17.25%. Though the gearing has not changed much from 16.5% before the exercise, the asset base is going to be almost doubled to S$603.4m, which is going to make a difference to the absolute amount of debt the reit can incur before hitting the gearing limit. This will allow the reit to have more choices to make further acquisitions, thus helping it to achieve its target of having a portfolio size of S$1 billion in the next two to three years.

DPU Post Exercise
The projected annual DPU post exercise is 6.40 Singapore cents. Based on the DPU of 1.94 Singapore cents for the quarter ending 30 Sep 2010, the annualized DPU before the exercise is 7.76 Singapore cents. Whichever way you may want to calculate and compare the yield before and after the exercise, whether it is by TERP or by using the last closing price before announcement of the rights issue, the absolute amount of distribution you are going to received per unit is going to be reduced. So for existing unit holders you must keep a close tab on the schedule for rights issue, and not forget to either sell the rights, exercise the rights, or partially sell and partially exercise the rights before the deadline in order not to lose out on anything.

Related Links
Related Posts


Thursday, November 11, 2010

First Reit - Follow up details of the proposed acquisition and rights issue - 10 NOV 2010

Follow up details of the proposed acquisition and rights issue:
Key Points
  • Distribution in projection year 2011 is expected to rise from 8.57% to 9.14% following the acquisition of two new healthcare properties in Indonesia.
  • This is based on a forecast annualised DPU of 6.40 Singapore cents for the full financial year ending 31 December 2011, in relation to its enlarged portfolio and financing through a combination of the underwritten renounceable rights issue of 345,664,382 new Units at an issue price of S$0.50 per Rights Unit and bank loan.
  • Upon completion of the Acquisitions, First REIT’s aggregate leverage will also be lowered from 18.60% to 17.25% for the Projection Year 2011.
  • On completion of the Acquisitions, the conditional master lease agreements entered into with Lippo in relation to the Properties will commence for a 15 year lease term.
  • Rental income of both Properties comprise a base rent component which is payable quarterly in advance, and subject to a stepped up increase every year thereafter at a rate equal to 2 times of the percentage increase of Singapore’s Consumer Price Index for the preceding calendar year; as well as a variable rent component. 
Related Posts


MapletreeLog - Details of cumulative distribution in connection with the recent equity fund raising - 10 NOV 2010

Details of cumulative distribution in connection with the recent equity fund raising. See press release.

This is further to its announcement dated 21 September 2010 on the Cumulative Distribution Books Closure Date in connection with the equity fund raising.

Key Points
  • The actual amount of the Cumulative Distribution for the period from 1 July 2010 to 14 October 2010 is 1.78 cents per unit. 
  • This comprises 1.54 cents per unit for the period 1 July 2010 to 30 September 2010 (as announced in the 2010 third quarter financial statement announcement) and 0.24 cents per unit for the period 1 October 2010 to 14 October 2010.
  • Unitholders whose securities accounts with The Central Depository (Pte) Limited were credited with units in MapletreeLog as at 5.00 pm on 29 September 2010 will be entitled to the Cumulative Distribution that will be paid on Monday 29 November 2010.
Related Posts


Wednesday, November 10, 2010

Sabana REIT to raise S$696.1m through IPO - 10 NOV 2010

Source

SINGAPORE: Sabana Shari'ah Compliant Industrial Real Estate Investment Trust (Sabana REIT) said it planned to raise up to S$696.1 million through an initial public offering (IPO), according to a prospectus it has filed with the Monetary Authority of Singapore (MAS).

It said it planned to sell 632.8 million units, with each unit priced between S$1 and S$1.10.

If successful, this would make it the first Shari'ah-compliant listing in Singapore.

The Singapore-based REIT invests mainly in industrial properties in Asia, as well as other real estate-related assets that are Shari'ah compliant.

The initial property portfolio of the REIT will comprise 15 industrial properties in Singapore with a gross floor area of 3.3 million square feet.

According to agency reports, the roadshows for the IPO will start on Tuesday. Listing is planned for this month.


Author's Note
The preliminary prospectus for Sabana Reit is now available in the MAS Opera website. For Reits, you should click on the "Latest" link under  "Collective Investment Scheme Offers".

From the prospectus, the Sponsor of the Reit is Freight Links Group, which is also listed in SGX. Following is a short description of the group from the prospectus:
"Established in 1981 and listed on the SGX-ST in 1995, the Freight Links Group is a leading international total logistics solutions provider with a strong presence in Singapore and the Asia Pacific region." 



Plife Updated Target Price following Q3 2010 result release

Plife Updated Target Price following Q3 2010 result release.

CIMB OUTPERFORM 1.960 08/11/10
DBS Vickers BUY 1.840 08/11/10
Kim Eng BUY 1.940 09/11/10
Phillip Securities HOLD 1.780 09/11/10

Latest updates at Stock Target Price.



SUNTEC Reit - Circular to shareholders in relation to proposed acquisition of a one-third stake in MBFC 1 - 8 NOV 2010

SUNTEC Reit - Circular to shareholders in relation to proposed acquisition of a one-third stake in MBFC 1. See Circular.

This Circular follows the previously announced proposed acquisition of one-third stake in MBFC dated 26 Oct 2010. More details of the financing are provided in the circular.

Key Points
  • The $1495.8m ($1548.2m total cost) purchase of MBFC would be financed by a $1105m loan facility and a $428.2m private placement of new units. 
  • Pricing of the new units will be revealed at a later date. 
  • After the acquisition, the gearing will rise from 33% to 41.5% but will fall to 37.3% with the intended repayment of shareholders' loan from ORQ.
Related Posts
SUNTEC Reit proposed acquisition of a one-third interest in Marina Bay Financial Centre Towers 1 and 2 and the Marina Bay Link Mall - 26 OCT 2010

Saizen Reit Q3 2010 Quarterly Earnings Report

Q3 2010 results for Saizen Reit:
Key Points
  • Gross revenue, net property income and net income from operations increased marginally yoy by 0.8%, 0.8% and 2.5% respectively. In Japanese yen terms, they were slightly lower, but were out-weighed by a 2.8% appreciation of the JPY against the S$.
  • On a qoq basis, gross revenue, net property income and net income from operations increased by 4.8%, 11.6% and 20.3% respectively. In JPY-terms, while gross revenue stayed flat, net property income and net income from operations increased by 6.5% and 14.8% respectively. This was due mainly to lower property operating expenses and other trust expenses. This performance was also enhanced by a 4.7% appreciation of the JPY against the S$ between quarters.
  • The average occupancy rate was 90.9% in 1Q FY2011, as compared to 91.3% in the first quarter ended 30 Sep 2009 and 91.7% in the previous quarter ended 30 Jun 2010.
  • Saizen REIT intends to continue to pay out semi-annual distributions in accordance with its distribution policy.
  • The next distribution payment is expected to take place in March 2011 in respect of distributable cash accumulated in the six months financial period ending 31 December 2010.
  • NAV per Unit has decreased from S$0.40 per Unit as at 30 June 2010 to S$0.36 per Unit as at 30 September 2010 due to the exercise of warrants with prices lower than the prevailing net asset value per Unit.
Author's Note
The manager has reiterated its intention to pay out distributions. The distribution frequency will be semi-annual, and the payments will be for the following periods:
  1. From 1 Jan to 30 Jun
  2. From 1 Jul to 31 Dec
The next distribution will thus be for the period from 1 Jul to 31 Dec 2010, and will probably be announced in the next quarterly earnings report. The payment of the next distribution is expected to be in Mar 2011.




Saizen Reit divests of Jewel Town Suehiro - 10 NOV 2010

Divestment of Jewel Town Suehiro from the property portfolio of YK Shintoku.
See press release.

Key Points
  • YK Shintoku has, on 9 November 2010, entered into a sale and purchase agreement for the divestment of Jewel Town Suehiro (“JT”) to an independent private investor (the “JT Buyer”) for a cash consideration of JPY 146,042,400 (S$2.3 million 1 ) (the “JT Sale Price”). 
  • The divestment of JT was completed on the same day upon the payment of the full amount of the JT Sale Price by the JT Buyer.
  • JT, located in Hakodate, was built in August 1991 and comprises 30 residential units and 8 car parking units. It contributed about 0.5% (or approximately JPY 19.1 million) of Saizen REIT’s annual revenue in the financial year ended 30 June 2010 (“FY2010”).
  • Given the small size of JT relative to the entire portfolio of Saizen REIT, the Current Divestment is not expected to have any material impact on the financial position of Saizen REIT.
Related Posts


Tuesday, November 9, 2010

FrasersComm Proposes Consolidation of Units - 9 NOV 2010

FrasersComm Proposes Consolidation of Units:
Key Points
  • Consolidation of every five existing units in FCOT held by unitholders of FCOT as at a books closure date into one Unit. 
  • The number of Consolidated Units which Unitholders will be entitled to will be rounded down to the nearest whole Consolidated Unit and any fractions of Consolidated Units arising from the Proposed Unit Consolidation will be disregarded. 
  • Each Consolidated Unit will rank pari passu with each other.
  • Rationale for the proposed unit consolidation:
    • improvement in the market perception and attractiveness of FCOT and the Units
    • reduction of the magnitude of volatility of FCOT’s Unit trading price and market capitalization
Author's Note
What I can gather from the press release:
  1. If you are holding 1000 units of FCOT, then it will become 200 units.
  2. If you are holding odd lots of say 996 units of FCOT, then the 995 units will become 190 units. The remaining 1 unit will be disregarded.
  3. Though it is not explicitly mentioned, the consolidated unit should be worth 5 times the original price if we do not take the disregarded units into account. Based on the closing price of S$0.170 on 9 Nov 2010, the pricing of the new unit should be S$0.850. But this needs further clarifications from the manager as we do not know whether the number of disregarded units will have any significant impact.
This consolidation exercise will be subjected to unit holders' in an EGM to be convened. The date for the EGM and the book closure date for the consolidation exercise will be announced later.




First Reit - proposed acquisitions and rights issue - 9 NOV 2010

First Reit - proposed acquisitions and rights issue & receipt of approval in-principle for the listing of new units:
Key Points
  • First Reit to acquire two Jakarta hospitals for a purchase consideration of S$205.5 million to be funded partially by Rights Issue of 345,664,382 new units.
  • The Mochtar Riady Comprehensive Cancer Centre (“MRCCC”) is being acquired from Wincatch Limited, an unrelated third party, for S$170.5 million, and Siloam Hospitals Lippo Cikarang (“SHLC”) is being acquired from the sponsor of First REIT, PT Lippo Karawaci Tbk, for S$35.0 million.
  • The respective purchase prices of MRCCC and SHLC represent an attractive discount of 19.7% and 13.8% respectively to the average of the properties' latest independent valuations.
  • The Acquisitions will increase First REIT‟s assets by 74.3% to S$603.4 million.
  • The rights issue will raise approximately S$172.8 million in gross proceeds.
  • The rights issue will be on a pro rata basis of five Rights Units for every four existing Units, at S$0.50 each (fractional entitlements to be  disregarded).  
  • The Rights Issue books closure date will be at 5.00 p.m. on 3 December 2010.
  • The Issue Price represents a discount of 47.4% to the closing price of S$0.95 per Unit on 4 November 2010 (the “Closing Price”).
    Author's Note
    First Reit has finally announced new acquisitions after a long wait, and a very significant one relatively to its existing assets. For quite sometime the Reit has been rather quiet, with the DPU being relatively constant from quarter to quarter. However, there has been quite a noticeable surge in its share price recently, which closed at a all time high of 0.980 cents on 8 Nov 2010, just a day before the release of this announcement.



    Monday, November 8, 2010

    Fortune Reit Q3 2010 Quarterly Earnings Report

    Q3 2010 results for Fortune Reit:
    Key Points
    • DPU for the reporting quarter is 5.76 HK cents.  
    • Total Revenue for the third quarter was HK$205.7 million, 22.9% higher compared to the same quarter last year. 
    • The higher revenue was mainly contributed by the 3 new properties acquired in October 2009 as well as improved performance in The Metropolis Mall, Ma On Shan Plaza and Jubilee Court Shopping Centre.
    • Portfolio occupancy rate and passing rent were at a record high of 98.0% and HK$27.7 psf as at 30 September 2010.
    • Net Property Income was HK$142.2 million, a 19.9% increase over the same period last year.
    • Gearing level of about 21.5% as at 30 September 2010.
    • NAV per unit of HK$5.67 as at 30 September 2010.
    Author's Note
    The DPU for the reporting quarter is 5.76 HK cents. There will not be any distribution this quarter as the reit has a semi-annual distribution policy.

    DPU for the previous quarter was 5.89 HK cents.



    Plife Q3 2010 Quarterly Earnings Report

    Q3 2010 results for Plife:
    Key Points
    • DPU for the reporting quarter is 2.25 cents.
    • For 3Q 2010, PLife REIT registered gross revenue of S$21.2 million, a 28.3% increase from S$16.5 million in the previous corresponding period (“3Q 2009”).
    • Higher revenue for 3Q 2010 was primarily due to additional revenue contribution amounting to S$1.8 million from the Japanese properties acquired in the fourth quarter last year.
    • Net property income was S$19.4 million for 3Q 2010 and S$53.9 million for YTD 2010, up 26.5% and 18.5% from 3Q 2009 and YTD 2009 respectively.
    • Successfully completed the pre-emptive refinancing of its existing JPY 13.66 billion (approximately S$215.0 million) loan facilities, which constituted about 46% of the Group’s total loan portfolio.
    • Effectively lengthened PLife REIT’s weighted average debt maturity period to 4.20 years with no near  term refinancing requirements until FY2013.
    • As at 30 September 2010, the gearing level of the Group stood at a healthy 35%.
    • The committed occupancy for the overall portfolio of 100% as at 30 September 2010.
    • Adjusted NAV per unit (excluding the distributable income) of S$1.36 as at 30 September 2010.
    • The Books will close from 5pm on 16 Nov 2010 for the purpose of determining Unitholders’ entitlement to the distribution. 
    • The distribution will be paid on 13 Dec 2010. 
    Author's Note
    The DPU of 2.25 cents will be paid on 13 Dec 2010. Books closure is on 16 Nov 2010.

    DPU was 2.090 cents in the previous quarter.


    Thursday, November 4, 2010

    LippoMapleTrust Updated Target Price following Q3 2010 result release

    LippoMapleTrust Updated Target Price following Q3 2010 result release.

    LippoMapleTrust
    OCBC
    BUY
    S$0.60
    04/11/10

    Latest updates at Stock Target Price.



    Wednesday, November 3, 2010

    LippoMapleTrust Q3 2010 Quarterly Earnings Report

    Q3 2010 results for LippoMapleTrust:
    Key Points
    • DPU for the reporting quarter is 1.09 cents. This equates to an annualized yield of 8.6% at closing unit price of 51.5 cents on 30 September 2010.
    • LMIR Trust has continue to maintain a conservative gearing and its aggregate leverage as at 30 September 2010 was 10.8%, with total borrowings stable at S$125.0 million.
    • LMIR Trust portfolio occupancy remains significantly better than the industry average, with an occupancy rate of 98.1% as at 30 September 2010.
    • Net asset value per unit of S$0.79 as at 30 September 2010.
    • The Books will close from 5pm on 12 Nov 2010 for the purpose of determining Unitholders’ entitlement to the distribution. 
    • The distribution will be paid on 30 Nov 2010. 
    Author's Note
    The DPU of 1.09 cents will be paid on 30 Nov 2010. Books closure is on 12 Nov 2010.

    DPU was 1.04 cents in the previous quarter.




    CMT actual quantum of DPU for the period from 1 July 2010 to 30 Sep 2010 - 3 NOV 2010

    CMT actual quantum of DPU for the period from 1 July 2010 to 30 Sep 2010. See press release.

    Key Points
    Further to the announcement on 22 October 2010, the actual quantum of distribution per unit in CMT (“Unit”) for the period from 1 July 2010 to 30 September 2010 remains unchanged from the estimated distributable taxable income of 2.36 cents per Unit.

    Related Posts





    AIMSAMPI Reit Sale of 23 Changi South Avenue 2 - 3 NOV 2010

    AIMSAMPI Reit Sale of 23 Changi South Avenue 2. See press release.

    Key Points
    • Sale of 23 Changi South Avenue 2 Singapore 486443 above independently appraised value.
    • Sale price: S$16.7 million.
    • Book value as at 30 September 2010: S$16.2 million.
    • Sale expected to complete in January 2011.
    • Provides opportunity for future investment opportunities. 
    • In the interim, net sale proceeds will be used to repay debt under the Trust’s newly established revolving credit facility, reducing aggregate leverage to approximately 33.4% from approximately 34.8%.
    • Continued execution of Manager’s strategy to maximise returns for unitholders.



    Tuesday, November 2, 2010

    AIMSAMPI Reit Updated Target Price following Q3 2010 result release

    AIMSAMPI Reit Updated Target Price following Q3 2010 result release.

    AIMSAMPIReit Phillip Securities HOLD S$0.24 01/11/10

    Latest updates at Stock Target Price.

    Related Posts
    AIMSAMPI Reit Q3 2010 Quarterly Earnings Report


    Monday, November 1, 2010

    CDL H-Trust Updated Target Price following Q3 2010 result release

    CDL H-Trust Updated Target Price following Q3 2010 result release.

    DMG BUY S$2.30 29/10/10
    CIMB NEUTRAL S$2.21 29/10/10
    DBS Vickers BUY S$2.28 01/11/10

    Latest updates at Stock Target Price.

    Related Posts
    CDL H-Trust Q3 2010 Quarterly Earnings Report

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