Category: CDL H-Trust

 

CDL H-Trust – SGX

ANNOUNCEMENT THE ISSUE OF 120,162,795 NEW STAPLED SECURITIES (THE “NEW STAPLED SECURITIES”) AND USE OF PROCEEDS OF THE EQUITY FUND RAISING

Issue of 120,162,795 New Stapled Securities

Further to its announcement on 6 July 2007 in relation to the launch of the offer and placement of New Stapled Securities (the “Equity Fund Raising”), M&C REIT Management Limited, as manager of H-REIT (the “H-REIT Manager”), and M&C Business Trust Management Limited, as trustee-manager of HBT (the “HBT Trustee-Manager”), wish to announce that they have issued an aggregate of 120,162,795 New Stapled Securities today. With this issue of 120,162,795 New Stapled Securities, the total number of Stapled Securities in issue is 822,023,005.
These New Stapled Securities will commence trading on the Main Board of Singapore Exchange Securities Trading Limited (the “SGX-ST”) at 9.00 a.m. today.

Results of the Private Placement

As announced by the H-REIT Manager and the HBT Trustee-Manager on 6 July 2007, the book of orders for the New Stapled Securities under the Private Placement (as defined in the CDL Hospitality Trusts Circular dated 6 July 2007 (the “Circular”)) was closed on the same day that the Private Placement commenced, namely 6 July 2007. Indications of interest received by the H-REIT Manager and the HBT Trustee-Manager for the New Stapled Securities at S$2.52 per New Stapled Security under the Private Placement were approximately 24 times the number of New Stapled Securities available for subscription under the Private Placement.

Results of Preferential Offering

After taking into account the Rounding Mechanism (as described in the Circular), the final number of New Stapled Securities offered under the Preferential Offering (as defined in the Circular) was 107,162,795 New Stapled Securities.

The H-REIT Manager and the HBT Trustee-Manager are pleased to announce that as at the close of the Preferential Offering on 13 July 2007, valid acceptances for 100,635,729 New Stapled Securities were received under the Preferential Offering. The Joint Lead Managers and Underwriters, DBS Bank Ltd and Citigroup Global Markets Singapore Pte. Ltd., have procured subscriptions and/or subscribed for the remaining 6,527,066 New Stapled Securities under the Preferential Offering pursuant to the placement agreement dated 6 July 2007.

Rule 812(1) of the Listing Manual

As stated in the announcement dated 18 June 2007, the H-REIT Manager and the HBT Trustee-Manager have obtained a waiver (the “Waiver”) from the SGX-ST from the requirements under Rule 812(1) of the Listing Manual to allow Restricted Placees (as defined in the Circular) (such as the directors of the H-REIT Manager and the HBT Trustee-Manager, their immediate family members and substantial holders of Stapled Securities) who are Singapore Registered Security Holders (as defined in the Circular) to accept their provisional allocations of New Stapled Securities under the Preferential Offering in full or in part.

Except for subscriptions under the Preferential Offering by Restricted Placees under the Waiver, none of the Restricted Placees subscribed for any New Stapled Securities under the Private Placement.

Status of the New Stapled Securities

The New Stapled Securities will, upon issue and allotment, rank pari passu in all respects with the existing Stapled Securities, including the right to any distributions which may be paid for the period from the date the New Stapled Securities are issued to 31 December 2007, as well as all distributions thereafter.

For the avoidance of doubt, the New Stapled Securities will not be entitled to participate in the distributions of any distributable income accrued by H-REIT prior to the date of issue of such New Stapled Securities.

Use of Proceeds

As stated in the announcement dated 6 July 2007, the net proceeds of the Equity Fund Raising are intended to be used to repay certain indebtedness and for other general corporate and working capital purposes.

Out of the net proceeds of approximately S$291.0 million from the Equity Fund Raising, S$177.4 million will be used to repay part of tranche B of the DBS Bank Bridging Loan Facility (as defined in the Circular) with DBS Bank Ltd which was used to fund the acquisition of Singapore Hotel Investment Holdings Company for the purpose of the acquisition of Novotel Clarke Quay. The H-REIT Manager and the HBT Trustee-Manager will make further announcements upon the utilization of the remaining net proceeds of approximately S$113.6 million from the Equity Fund Raising.

July 19, 2007 CDL H-Trust No Comments »

CDL REITS – DBS
CDL REITS, dbs remains a BUY with target price $2.81 (from $2.20)

– Story: CDLHT’s is to issue up to 130m shares for a equity fund raising exercise in two tranches: 1) 3 for 20 basis and 2) private placement to institutional and other investors.

– Point: Including their recent purchases in Novotel Clarke Quay, they have five Singapore hotels (over 2,300 rooms) and a New Zealand hotel (455 rooms). The REIT has become a key hotel landlord in Singapore benefittng from the tourism boom and increase in business travelers.

– Relevance: We assume the price for the new tranche will be at S$2.20, translating into estimated value of S$286m for the new shares. This will help to lower the gearing ratio from 43% to 26%. We have also increased our y-o-y rental rate increase to 18% for the Singapore portfolio and this works out to a new target price of S$2.81. Maintain Buy.

– New share issue: CDLHT is issuing 130m new shares in two tranches: 1) A non-renounceable preferential offering to Singapore-registered security holders on 3 for 20 basis; and 2) A private placement to institutional and other investors. The issue price is expected to be close to 10% discount to the weighted average price for trades done for the day the placement agreement is signed. The purpose is to repay certain existing debts and for general corporate and working capital. It will also help to lower the gearing ratio, providing the REIT flexibility to make further yield accretive acquisitions.

– Maintain Buy, TP S$2.81: We assume the pricing for the new tranches to be at S$2.20 per share, translating to a potential increase in capital of S$286m. This will help to offset the capital for the Novotel Clarke Quay purchases of S$201m and some other outstanding debts. The capital call will also lower their gearing. We remain positive on the stock as current hotel demand outweighs supply plus the upcoming mega projects and events will help sustain visitor arrival growth. We have raised our forecast for Singapore hotel rates to increase at a 18% y-o-y from 2007 to 2012 for RevPAR under their portfolio. Maintain Buy, target price increased to S$2.81 at parity to our DCF calculation based on fully diluted basis. This is the best stock within the property sector with the highest exposure and benefits the most from the tourism sector’s upturn.

July 3, 2007 CDL H-Trust No Comments »

CDL REIT – BNP
CDL REITS, bnp remains a BUY with target price $2.81 (from $2.28)

– We believe CDREIT, a BNP Top Pick, will enjoy higher RevPAR in fiscal 2007 and 2008, underpinned by the uptrend in tourist arrivals and the supply crunch. We forecast a 30% and 25% jump in the average room rate of CDREIT’s portfolio of Singapore hotels in 2007 and 2008, respectively. Maintain BUY, with a revised target price of SGD2.81.

– Upgrading our RevPAR assumptions . We raise our RevPAR growth assumptions for CDREIT’s portfolio of Singapore hotels to 37% for 2007 (27% previously) and 28% for 2008 (21% previously), underpinned by a combination of both increasing room rates and improving occupancies.

– Rising demand and limited supply should propel room rates to new highs in 2007 and 2008 , The Singapore hotel industry has witnessed robust growth led by the strong tourism uptrend and the hotel shortage situation. The new supply of rooms is likely to be limited to only 2% in 2007 and 7% in 2008, with visitor growth estimated to rise 6-7% annually. With the emergence of low-cost carriers throughout Southeast Asia, interregional travel should grow rapidly. Singapore is also seeking a bigger slice of the multibilliondollar meetings, incentives, conventions and exhibitions (MICE) market, which is expected to grow to 100m in the Asia-Pacific by 2015, from 50m at present. We see greater vibrancy in the leisure and business travel space, considering the host of measures undertaken by the government to strengthen Singapore’s tourism offering.

– Upward revision in hotel rates to drive DPU growth . CDREIT’s strong operating trends will continue to feed through to 2008. We raise our 2007 earnings estimates to SGD68.8m from SGD66.7m, which is premised on the assumption of a portfolio average room rate (ARR) of SGD212 (SGD202 previously), average occupancy of 87% (85% previously) and a further SGD276m worth of acquisitions in 2H07 at an NPI yield of 5.5%.

– New target price of SGD2.81, based on DDM valuation . We maintain our BUY rating on CDREIT and have upgraded our target price to SGD2.81 from SGD2.28. Our 12-month target price is based on DDM, using a WACC of 6.3% and a terminal growth rate of 1%. We have adopted the DDM approach given the steady income distributions from the REIT structure. DDM also captures the longer-term impact of sustained growth in DPU.

July 3, 2007 CDL H-Trust No Comments »

CDLHTrust – DBSVickers

Call for Capital

New share issue: CDLHT is issuing 130m new shares in two tranches: 1) A non-renounceable preferential offering to Singapore-registered security holders on 3 for 20 basis; and 2) A private placement to institutional and other investors. The issue price is expected to be close to 10% discount to the weighted average price for trades done for the day the placement agreement is signed. The purpose is to repay certain existing debts and for general corporate and working capital. It will also help to lower the gearing ratio, providing the REIT flexibility to make further yield accretive acquisitions.

Maintain Buy, TP S$2.81: We assume the pricing for the new tranches to be at S$2.20 per share, translating to a potential increase in capital of S$286m. This will help to offset the capital for the Novotel Clarke Quay purchases of S$201m and some other outstanding debts. The capital call will also lower their gearing. We remain positive on the stock as current hotel demand outweighs supply plus the upcoming mega projects and events will help sustain visitor arrival growth. We have raised our forecast for Singapore hotel rates to increase at a 18% y-o-y from 2007 to 2012 for RevPAR under their portfolio. Maintain Buy, target price increased to S$2.81 at parity to our DCF calculation based on fully diluted basis. This is the best stock within the property sector with the highest exposure and benefits the most from the tourism sector’s upturn.

June 28, 2007 CDL H-Trust No Comments »

CDLHTrust – DBS

It keeps getting bigger and better

Latest acquisition creates location synergies: CDLHT recently acquired Novotel Clarke Quay for S$201m. The leasehold prime 25-storey hotel is located in the Clarke Quay area on top of the Liang Court Shopping Podium and has a land area of 12,925.4 sq m. Comprising 398 rooms, the property offers facilities such as an outdoor swimming pool, six food and beverage outlets, conference facilities, recreation facilities and 755 shared car park lots. The property recently completed a comprehensive renovation to key public areas, restaurants and all guest rooms. This is their second acquisition from third-party owners since their IPO. This acquisition helps them to become the biggest hotel landlord in Singapore, in terms of number of rooms. All five hotels in Singapore are actually within the same cluster area of Clarke Quay/ Havelock Road area which will create a clustering effect on the portfolio and synergistic effect on the room rates.

More hotels potentially injecting to the trusts: CDLHT has a pre-set agreement with M&C and CDL related groups that all the present and future development under their group in Singapore will all contain first right of refusal. Currently, Copthorne Orchid Hotel (440 rooms) is the only one that is in operation with this clause. Future developments under this agreement include the luxurious St Regis Singapore in Cuscaden Road (299 rooms, owned by CDL/Tid/Hong Leong Group, to be opened by end 2007) as well as a hotel in Mohammad Sultan Road (350 rooms, owned by M&C, to be opened in 2008). The two, together with Copthorne Orchid Hotel, will potentially add over 1,000 quality hotel rooms to their portfolio after 2 – 3 years of maturity.

Maintain Buy, Target Price S$2.40: The inclusion of the Novotel Clarke Quay will increase their market share in the Singapore hotel section. As the current hotel demand is outweighing supply, with upcoming mega events such as Formula 1 race in 2008 and the upcoming Integrated Resorts and conventions to further fuel the visitor arrival numbers, these should greatly benefit the hotel operators in Singapore. All the above news will contribute to the growth of the company and support our 15% y-o-y increase in hotel RevPAR for the portfolio. Maintain Buy, target price of S$2.40 at parity to our DCF calculation.

May 22, 2007 CDL H-Trust No Comments »