Cambridge – BT
Cambridge Industrial Trust Management Limited, the manager of Cambridge Industrial Trust (CIT), said on Thursday that it intends to undertake an equity fund raising of about S$50.4 million to help fund the acquisitions of four properties.
It is planning a private placement of 56.50 million new units in CIT at an issue price of S$0.531 each to raise gross proceeds of about S$30.0 million.
It will also offer up to 38.48 million new preferential units in CIT on the basis of one preferential unit for every 25 existing units in CIT held on October 29, 2010. The preferential units will be priced at S$0.531 each to raise gross proceeds of up to about S$20.4 million.
The properties to be acquired comprise 25 Tai Seng Avenue, a 7-storey light industrial cum office building which was completed in 2009; two light industrial buildings at 511 and 513 Yishun Industrial Park A; a 4-storey factory and a built-to-suit project for lease, expected to be completed and operational in 2011.
The total acquisition cost is estimated around S$74.3 million.
CIT's manager intends to finance about S$48.6 million of the total cost with the net proceeds from the equity fund raising.
The balance S$25.7 million of the cost will be financed by a partial draw-)down of S$21 million under an existing acquisition term loan facility and existing cash of S$4.7 million.
The Royal Bank of Scotland N.V., Singapore Branch has been appointed as the sole global co-ordinator of the equity fund raising, and the sole bookrunner and underwriter for the private placement.
MIT – SGX
For Immediate Release
MAPLETREE INDUSTRIAL TRUST UNIT PRICE SURGED ON TRADING DEBUT
• Debuted strongly at S$1.15, representing an increase of 23.7% over the IPO Offering Price
• Closed at S$1.16, representing an increase of 24.7% over the IPO Offering Price
• Largest Singapore Real Estate Investment Trust IPO to-date
• Most active counter of the day with 345.0 million Units traded despite only three hours of
trading
Singapore, 21 October, 2010 – Mapletree Industrial Trust (“MIT”), a Singapore-focused real estate investment trust (“REIT”) and one of the largest landlords of industrial space in Singapore, enjoyed a strong trading debut at 2.00 p.m. today on the Main Board of Singapore Exchange Securities Trading Limited (the “SGX-ST”).
Raising gross proceeds of approximately S$1.19 billion from the offering of 594,913,000 Units to the public and under the placement tranche, as well as the Mapletree Cornerstone Subscription Units and the Cornerstone Units (as defined below), MIT is the largest Singapore REIT IPO to-date."
Excellent Debut
MIT’s units (“Units”) opened strongly at S$1.15 per Unit, a 23.7% increase over its offering price of S$0.93 per Unit (“Offering Price”). The Units reached an all-day high of S$1.20 per Unit, a 29.0% jump over its Offering Price. At the close of trading, the Units ended 24.7% higher than its Offering Price of S$0.93 at S$1.16 per Unit with approximately 345.0 million Units changing hands, making it the most actively traded counter on the SGX-ST today.
Commenting on the trading debut, Mr Tham Kuo Wei, Chief Executive Officer of Mapletree Industrial Trust Management Ltd, as manager of MIT (the “Manager”), said, “We are delighted with MIT’s excellent trading debut, which is a strong indication of the market’s confidence in the fundamentals and growth prospects of MIT.”
Overwhelming Response
The offering of 594,913,000 Units (the “Offering”), had earlier received overwhelming response with subscription rates of 27.7 times by retail investors (based on 80,645,000 Units and excludes the 25,500,000 Reserved Units) and 39.6 times by institutional investors (through the placement tranche comprising 488,768,000 Units).
The Sponsor1’s strong support of and commitment to MIT was demonstrated through its aggregate holding2 of 453,424,000 Units in MIT, which represents approximately 31.0% of the total number of Units in issue, with the over-allotment option exercised in full.
MIT had earlier secured prominent cornerstone investors such as Stichting Depository APG Tactical Real Estate Pool, American International Assurance Company Limited, Singapore Branch, American International Assurance Company (Bermuda) Limited, Henderson Global Investors, Columbia Wanger Asset Management, LLC, D.E. Shaw Valence International, Inc. and Prudential Asset Management(Singapore) Limited (acting for itself and on behalf of one or more investment funds and clients), who subscribed for an aggregate of 322,578,000 Units (the “Cornerstone Units”). These Cornerstone Units are also separate from the Offering.
CCT – CIMB
Lighter and stronger after divestment
• In line; maintain Neutral with higher target price of S$1.41 (from S$1.27). 3Q10 results met Street and our expectations with 9M10 DPU of 5.9cts forming 78% of our FY10 forecast. We maintain our estimates and roll over our DDM target price to CY12, raising it to S$1.41 (from S$1.27) with an unchanged discount rate of 7.8%. CCT trades at book value and offers a prospective dividend yield of 5.2%. In our last report, we estimated 7-8% DPU accretion assuming acquisitions of S$800m at NPI yields of 5.6% (which could raise our target price to S$1.46). However, in view of recent Grade-A transactions (Marina Bay Financial Centre and Chevron House) at under 4% net yields, acquiring at our estimated yields and accretion appear difficult, without income support at those levels. Announcements of accretive acquisitions and better-than-expected rental reversions for leases expiring in 2011 would provide re-rating catalysts, in our view.
• YTD DPU up 14% yoy. Despite a marginal decline in YTD revenue of S$299.8m (-0.1%) from loss of income after StarHub and Robinson Point were sold, net property income grew 3.6% yoy on lower property tax and operating expenses. Distributable income of S$145.6m grew even stronger at 14% yoy, boosted by lower interest costs, a result of lower borrowing levels. Stripping out gains from the sale of Robinson Point and StarHub Centre, and asset and derivatives revaluation losses, core net profit grew a healthy 11% yoy.
• Portfolio occupancy up 3% pts to 98.2%, almost single-handedly due to the divestment of StarHub Centre whose occupancy had been around 68%. Occupancy at other buildings was roughly flat with under 1%-pt movements. New leases/renewals for a total of 560,000sf have been signed YTD with tenants primarily in the Banking & Financial Services and Business Consultancy sectors. Average portfolio rents were down 0.7% qoq to S$8.73psf, excluding StarHub (S$8.79psf in 2Q10).
CRCT – DBSV
Portfolio remixing in progress
• DPU of 2.08 Scts in line with estimates
• Portfolio performance stable; AEI in Saihan yielding results
• Maintain HOLD given limited upside to raised TP of S$1.30; CRCT offers a total return of 12%.
DPU of 2.08 Scts in line. Topline and net property income were flattish at S$29.8m (-0.2% yoy, +0.7%qoq) and S$19.0m (+4.3%yoy, -3.8%qoq) respectively, due to a stronger S$:RMB exchange rate. Distributable income came in 3.2% higher, translating to a DPU of 2.08Scts.
Portfolio performance remains stable, enhancement works (“AEI”) in Saihan yielding positive results. In RMB terms, the portfolio delivered a topline growth of 4.5% yoy to RMB 147.2m. The improvement was portfolio wide with average occupancy levels inching up to 97.3% (against 95.0% a year ago), backed by stronger tenant sales growth of 24.9% yoy and 10.1% qoq. A major contributor came from Xizhimen Mall (recorded new contribution from Beijing Hualian Supermarket in Basement 1) and Wangjing Mall, which enjoyed higher rental revenues and occupancy rates. Sequentially, topline remained stable but we note that Saihan, Xinwu Mall – smaller malls in the portfolio have shown a sustained improvement in operational performance. Qibao Mall, however, reported lower revenues as it is undergoing asset enhancement and tenant remixing program. Looking ahead, we expect single digit uplift in topline as the manager continues to fine-tune the tenant profiles in order to attain the optimal portfolio mix and offering to consumers.
Renewed S$200m of short term loans. Renewed loans willextend debt expiry profile to 2.37 years from 1.01 years currently. Interest cover remains high at 6.2x.
Maintain Hold, TP raised to S$1.30. We maintain our HOLD call, given limited upside to our raised TP of S$1.30 after rolling valuation forward to FY11. CRCT offers forward yields of 6.7-6.9%.
CIT – BT
CIT Q3 distributable income dips 3.6%
CAMBRIDGE Industrial Trust (CIT) yesterday reported steady financial results for its third quarter.
Distributable income was down 3.6 per cent from a year earlier to $10.81 million. Distribution per unit was 1.187 cents.
The dip in distributable income was accompanied by a 2.6 per cent decline in gross revenue to $18.21 million, mainly due to lower rental income resulting from the sale of some properties and strata units between October last year and Sept 30, 2010.
Occupancy rate remains high at 99.97 per cent, ‘higher than the national average of 92.3 per cent’, CIT said.
The book value of its investment properties was $838.5 million at Sept 30, down from $874.2 million at Dec 31, 2009.
During Q3, CIT acquired two industrial properties. On Sept 16, it conducted a private placement exercise that raised $40 million, $24.7 million of which was used to partly fund the acquisition of the two properties for a total $37.7 million.
CEO of CIT Chris Calvert said that the ‘strong interest from institutional and certain private investors in the recent private placement demonstrates the attractiveness of CIT as a Reit investment’.
Further boosting its financial flexibility, CIT has secured a new three-year acquisition term loan and revolving credit facility totalling $70 million.
The company also moved to strengthen its balance sheet during Q3. It has reportedly reduced its gearing ratio to 39 per cent from 42 per cent, after repaying part of a $32 million term loan. It has earmarked an additional $35 million from divestments to a loan repayment on Nov 17 that will further bring its gearing to 36.8 per cent.
Following the September private placement, CIT unitholders had an advance distribution of 0.68 of a cent per unit. They will receive the balance of 0.507-cent per unit on Nov 30.
The CIT counter closed a cent higher at 56.5 cents yesterday.