Author: tfwee
Allco – SGX
Allco (Singapore) Limited (the “Manager”), the manager of Allco Commercial Real Estate Investment Trust (“Allco REIT”) (SGX:ALLC), refers to its announcement on 14 September 2007 in relation to the acquisition of additional three properties in Japan, described in the table below:
Property: Galleria Otemae Building
Location: Number 2, Tanimachi 2-chome, Chuo-ku, Osaka-shi, Osaka-fu
Property: ACO Azabu Aco Building
Location: Number 32-7, Higashi-Azabu 2 Chome, Minato-Ku, Tokyo
Property: Ebara Techno-Serve Headquarters Building
Location: Number 1-1, Haneda 5 Chome, Ota-ku, Tokyo
(collectively, the “Acquisitions”).
The Manager is pleased to announce that the Acquisitions were completed today.
Cambridge
CIT RECEIVES STRONG SUPPORT FROM UNITHOLDERS FOR ITS EQUITY FUND RAISING
Singapore, 25 September 2007 – Cambridge Industrial Trust Management Limited (“CITM”), the manager of Cambridge Industrial Trust (“CIT”), is pleased to announce that the unitholders of CIT (“Unitholders”) have approved the issue of new units (the “New Units”) in CIT to raise gross proceeds of approximately S$193.9 million (the “Equity Fund Raising”). Three other resolutions have been passed at CIT’s extraordinary general meeting held this morning, including the approval of an interested party/person transaction (under the Property Fund Guidelines and the SGX-ST Listing Manual respectively), being the proposed acquisition of 1 Tuas Avenue 3 from C&P Asia Warehousing Pte Ltd (“C&P”). C&P is an indirect wholly-owned subsidiary of CWT Limited.
CIT will soon undertake an international roadshow in connection with its Equity Fund Raising, which will include meeting institutional investors in the United States. CIT believes that it will be the first Singapore REIT to offer its units into the United States in reliance of Rule 144A of the U.S. Securities Act of 1933. The proceeds will be used for the acquisition of 1 Tuas Avenue 3 and five other properties in Singapore, namely, 9 Bukit Batok Street 22, 7 Ubi Close, 120 Pioneer Road, 48 Toh Guan Road East (Enterprise Hub) and 23 Woodlands Terrace.
Following the EFR, CITM expects an annualised yield of 7.0% for 2007 and a projected yield of 7.2% for 2008(1). Mr Wilson Ang, CEO of CITM, said “CITM is very pleased to have the backing of CIT’s unitholders for our acquisitions and financing plans. We will be commencing our roadshow shortly, with a view to completing our offering before the end of October 2007”.
(1) Based on an illustrative issue price for the New Units of S$0.80 per unit and various assumptions contained in CIT’s circular to Unitholders dated 6 September 2007 for the forecast period from 18 September 2007 and ending 31 December 2007 and for the projection year from 1 January 2008 and ending 31 December 2008.
MMP – SGX
SGX-ST Announcement
COMPLETION OF ACQUISITION OF “FLEG AMERICA-BASHI BUILDING”
The construction of Ebisu Fort was completed in September 2007. The seven storey building includes two basement levels and is located in the Ebisu area, Shibuya-ku in Tokyo. Designed for office and retail use, Ebisu Fort is 100% master-leased and sub-tenants have commenced fitting-out.
FLEG has been appointed as the local asset manager of Ebisu Fort for a period of two years from completion, with the option for MMP REIT or its nominee to extend that appointment by another year.
With the completion of this acquisition, MMP REIT’s portfolio comprises ten assets located in Singapore, China and Japan, valued in aggregate at approximately S$1.9 billion.
Suntec – OCBC
A Quay Acquisition
One Raffles Quay to be accretive. In Suntec REIT’s (Suntec) 3Q07 results, it announced its intention to acquire a one-third stake in One Raffles Quay (ORQ) for S$941.5m from Cheung Kong. The acquisition includes a rental top up of S$103.48m. No rental details were provided but we estimate that the acquisition should be marginally accretive. However, the market was less convinced and sold it down. To recap, we saw the best way to view the rental top up is as a form of a discount. ORQ’s actual value net of the income support is thus S$838m, or a reasonable S$1,877 psf. Our views appeared to be vindicated with the recent details released by Suntec, which showed an accretion of 1-8% depending on cost and proportion of debt/equity with respect to the funding of the acquisition.
ORQ NPI yield at 4.2%. We estimate the rental that Suntec will get from ORQ (including the income support) to be about S$8.30psf/mth. Grade A office presently should be able to achieve S$12-13psf/mth. So there is some upside potential to Suntec albeit in the middle term.
Financing details out. Suntec has revealed its financing options for the ORQ acquisition. 10% will be in the form of new units issued to the vendor, with the balance 90% to be in either straight debt or a combination of debt and convertible bond (CB). The maximum CB to be issued will be S$450m with its conversion price at 25% to 50% premium above the last traded unit price and a coupon of between 2.0% and 4.0%. All details are likely to be finalised at book building.
Maintain BUY and fair value of S$2.18. Since our ratings and fair value upgrade in end July, Suntec has done well, appreciating by about 3.0%. The investment case for Suntec remains intact. It is well positioned to benefit from the retail and office sector strong performance as well as from the F1 race in 2008 and the opening of Marina Integrated Resort in 2009. Finally in so far as acquisition growth is concerned, the ORQ transaction with its sponsor implies that future acquisition of assets from its sponsor’s development in the nearby new Business Financial Centre (BFC) is also assured. We thus retain our target size of S$5.5b and our fair value of S$2.18. Maintain BUY.
AREIT – BT
A-Reit plans US$180m developments
SINGAPORE – Singapore’s Ascendas Real Estate Investment Trust (A-Reit) will spend $270 million (US$180 million) building new business facilities in the next few months as it shifts focus to development rather than acquisitions, its chief said on Tuesday.
Chief executive officer Tan Ser Ping said A-Reit’s ability to create new assets would allow it to stay on track to reach a portfolio size of $5 billion by 2010, despite stiff competition for existing assets.
‘When there are good acquisition opportunities we will go for them. But if there are none, we’re not going to cry. There are other things to do,’ Mr Tan said in an interview.
A-Reit, Singapore’s third-largest property trust by market value, currently has a portfolio of 78 business and industrial properties – valued at US$3.3 billion as of end-June.
But unlike rivals such as Mapletree Logistics, Cambridge Industrial and MacathurCook Industrial who position themselves as Reits based on regional industrial assets, its assets are all located in Singapore.
Mr Tan said A-Reit would continue to focus on the republic for growth since including overseas assets in A-Reit’s portfolio would affect its cost of borrowing and change its risk profile.
The trust’s main shareholder, Singapore government-owned Ascendas, last month listed Ascendas India Trust, a business trust based on Indian business parks.
‘For markets such as India where you have the depth and width of potential, it’s better to have separate geographically focused vehicles,’ Mr Tan said. — REUTERS