demoforce1
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yes for me
General S-REITs Discussion Thread
- Thread starter Dividends Warrior
- Start date
yes for me
Thanks. OK now. Think last night I was mislead by the pop-up ad on webinar.
5408854088
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1H2020 Earnings of SGX’s Three European REITs
https://www.sgx.com/zh-hans/researc...818-1h2020-earnings-sgxs-three-european-reits
https://www.sgx.com/zh-hans/researc...818-1h2020-earnings-sgxs-three-european-reits
Shion
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S-Reits now cheap with upside potential, worst is over, say Eastspring, OCBC
S-Reits now cheap with upside potential, worst is over, say Eastspring, OCBC
https://www.businesstimes.com.sg/co...e-potential-worst-is-over-say-eastspring-ocbc
THE market looks to be pricing in too much downside for retail and office Singapore-listed real-estate investment trusts (S-Reits), said Eastspring Investments’ head of client portfolio managers, Adam Matthews, and the company's director of client portfolio managers, Sarah Lien.
The pair wrote in a commentary on Monday: “In our opinion, the sector is oversold as the support measures have provided much-needed relief in the form of dividend deferments, an increase in the leverage ceiling from 45 per cent to 50 per cent, property tax waivers passed on as rental waivers to support tenants’ cash flows, and the ability to defer rents until cash flows are able to cover costs.”
This is even as S-Reits in general have not fared well in the Covid-19 environment, and are one of the weaker areas of the market on a year-to-date returns basis.
S-Reits remain an attractive investment in a low-rate and modest growth environment - typically the kind of backdrop against which these trusts perform best, Mr Matthews and Ms Lien added.
In contrast with assumptions that weak sentiment, declining retail sales and lower transaction volumes are the new norm, Eastspring is taking a longer-term view and believes there are some opportunities.
In Singapore, Eastspring is focusing on valuations and acquiring high-quality assets at discounted prices.
While the office segment is still under stress, there will likely continue to be demand for Grade-A office space, not just from financial firms but also from companies in other industries such as e-commerce operators, fintech and social media enterprises, which have been moving into the central business district (CBD), Mr Matthews and Ms Lien wrote.
They added that after the pandemic, larger companies are also likely to diversify their staff across several locations, to take up space in suburban office complexes on top of having a CBD presence in order to ensure business contingency management.
As for the retail segment, malls in Singapore tend to be destinations for families on evenings and weekends, and families are likely to spend more money locally over the next six month because of travel restrictions still in place, said Eastspring.
Singapore’s listed property equity space is trading at multi-year lows, offering good value and recurring dividend income for investors patient enough to wait for a recovery - which is largely expected to resume from the third or fourth quarter of this year and into 2021, Mr Matthews and Ms Lien said.
“We believe the worst of the equity drawdown is behind us and that the Singapore real-estate market looks cheap with upside potential, even when factoring in headwinds from Covid-19, rental concessions, extended social distancing and so on,” they added.
Furthermore, most Singapore real estate businesses are still paying dividends, even though some have reduced their payouts. Today, the dividend yield on S-Reits averages 4.5 per cent, which Eastspring believes is attractive, relative to the global developed real-estate market with a 3.7 per cent dividend yield and MSCI's flagship global equity index, the MSCI ACWI Index, yielding 2.7 per cent.
OCBC Investment Research likewise believes the worst is over for S-Reits after a difficult first half of this year, and is “overweight” on the sector.
The research team generally believes investors can view the glass as half full for the S-Reit sector over the medium- to long-term horizon, but recognises that there are still near-term uncertainties, it said in a market commentary on Monday.
OCBC will adopt a “balanced approach” towards investing in S-Reits. It recommends that investors stick with some of the winners, such as those exposed to the sub-sectors of logistics and business parks, as well as S-Reits that have positioned themselves defensively in anticipation of a weaker outlook.
At the same time, investors should complement these winners with Reits in “beaten down” sub-sectors with deep value and supported by strong sponsors.
The research team’s top “buy” picks are thus Frasers Logistics and Commercial Trust with a fair value (FV) of S$1.59, Manulife US Reit with a US$0.84 FV, Mapletree North Asia Commercial Trust with a S$1.09 FV, CapitaLand Mall Trust with a S$2.29 FV and ESR-Reit with a S$0.45 FV.
Given the massive stimulus measures unleashed by central banks, interest rates are likely to stay lower for longer. This will continue to drive hunger for good-quality yield instruments such as select Reits, OCBC said.
The hunt for yield has already resulted in the yield compression of the S-Reit sector, with the FTSE Straits Times Reit Index now trading at a blended forward distribution yield of 5.5 per cent, which is 1.4 standard deviations below its 10-year mean of 6.2 per cent. However, the Singapore government 10-year bond yield has likewise seen a sharp decline. This brings the current forward yield spread to 457 basis points, which is 0.7 standard deviations above the 10-year average.
“Hence, on a relative basis, we opine that valuations of S-Reits are undemanding,” OCBC wrote.
S-Reits now cheap with upside potential, worst is over, say Eastspring, OCBC
https://www.businesstimes.com.sg/co...e-potential-worst-is-over-say-eastspring-ocbc
THE market looks to be pricing in too much downside for retail and office Singapore-listed real-estate investment trusts (S-Reits), said Eastspring Investments’ head of client portfolio managers, Adam Matthews, and the company's director of client portfolio managers, Sarah Lien.
The pair wrote in a commentary on Monday: “In our opinion, the sector is oversold as the support measures have provided much-needed relief in the form of dividend deferments, an increase in the leverage ceiling from 45 per cent to 50 per cent, property tax waivers passed on as rental waivers to support tenants’ cash flows, and the ability to defer rents until cash flows are able to cover costs.”
This is even as S-Reits in general have not fared well in the Covid-19 environment, and are one of the weaker areas of the market on a year-to-date returns basis.
S-Reits remain an attractive investment in a low-rate and modest growth environment - typically the kind of backdrop against which these trusts perform best, Mr Matthews and Ms Lien added.
In contrast with assumptions that weak sentiment, declining retail sales and lower transaction volumes are the new norm, Eastspring is taking a longer-term view and believes there are some opportunities.
In Singapore, Eastspring is focusing on valuations and acquiring high-quality assets at discounted prices.
While the office segment is still under stress, there will likely continue to be demand for Grade-A office space, not just from financial firms but also from companies in other industries such as e-commerce operators, fintech and social media enterprises, which have been moving into the central business district (CBD), Mr Matthews and Ms Lien wrote.
They added that after the pandemic, larger companies are also likely to diversify their staff across several locations, to take up space in suburban office complexes on top of having a CBD presence in order to ensure business contingency management.
As for the retail segment, malls in Singapore tend to be destinations for families on evenings and weekends, and families are likely to spend more money locally over the next six month because of travel restrictions still in place, said Eastspring.
Singapore’s listed property equity space is trading at multi-year lows, offering good value and recurring dividend income for investors patient enough to wait for a recovery - which is largely expected to resume from the third or fourth quarter of this year and into 2021, Mr Matthews and Ms Lien said.
“We believe the worst of the equity drawdown is behind us and that the Singapore real-estate market looks cheap with upside potential, even when factoring in headwinds from Covid-19, rental concessions, extended social distancing and so on,” they added.
Furthermore, most Singapore real estate businesses are still paying dividends, even though some have reduced their payouts. Today, the dividend yield on S-Reits averages 4.5 per cent, which Eastspring believes is attractive, relative to the global developed real-estate market with a 3.7 per cent dividend yield and MSCI's flagship global equity index, the MSCI ACWI Index, yielding 2.7 per cent.
OCBC Investment Research likewise believes the worst is over for S-Reits after a difficult first half of this year, and is “overweight” on the sector.
The research team generally believes investors can view the glass as half full for the S-Reit sector over the medium- to long-term horizon, but recognises that there are still near-term uncertainties, it said in a market commentary on Monday.
OCBC will adopt a “balanced approach” towards investing in S-Reits. It recommends that investors stick with some of the winners, such as those exposed to the sub-sectors of logistics and business parks, as well as S-Reits that have positioned themselves defensively in anticipation of a weaker outlook.
At the same time, investors should complement these winners with Reits in “beaten down” sub-sectors with deep value and supported by strong sponsors.
The research team’s top “buy” picks are thus Frasers Logistics and Commercial Trust with a fair value (FV) of S$1.59, Manulife US Reit with a US$0.84 FV, Mapletree North Asia Commercial Trust with a S$1.09 FV, CapitaLand Mall Trust with a S$2.29 FV and ESR-Reit with a S$0.45 FV.
Given the massive stimulus measures unleashed by central banks, interest rates are likely to stay lower for longer. This will continue to drive hunger for good-quality yield instruments such as select Reits, OCBC said.
The hunt for yield has already resulted in the yield compression of the S-Reit sector, with the FTSE Straits Times Reit Index now trading at a blended forward distribution yield of 5.5 per cent, which is 1.4 standard deviations below its 10-year mean of 6.2 per cent. However, the Singapore government 10-year bond yield has likewise seen a sharp decline. This brings the current forward yield spread to 457 basis points, which is 0.7 standard deviations above the 10-year average.
“Hence, on a relative basis, we opine that valuations of S-Reits are undemanding,” OCBC wrote.
reddevil0728
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hope to see my darlings turn deep green soon
What are your darlings?
Day after tomorrow boat not coming back
cha cha music stop
Pls don't come back, time to row ahead and don't look back.
I don’t dare to touch hospitality reit. ART drop like hell.
NewInvestor
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Shion
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Analysts maintain 'overweight' on S-REITs as sector remains a 'stable yield investment'
Analysts maintain 'overweight' on S-REITs as sector remains a 'stable yield investment'
https://www.theedgesingapore.com/node/320617
Analysts are overall positive on Singapore REITs (S-REITs) following the worldwide fiscal and monetary stimulus from central banks, lowered interest rates, as well as the extended Jobs Support Scheme (JSS) unveiled on August 17.
The JSS will now provide 10% to 50% in wage subsidies for up to seven months from August depending on the project recovery of the different sectors.
For the hospitality and retail sectors – two of the harder-hit ones from the Covid-19 pandemic – local employees will receive wage support of 50% and 30% respectively, from 75% and 50% previously.
The government has also set up some $320 million in tourism credits to drive local spending to eateries, shops, hotels, and tourist attractions in Singapore.
As at August 24, the FTSE S-REIT Index was down 7.1% year-to-date (y-t-d), outperforming the Straits Times Index (STI) which registered a 18.9% decline y-t-d.
Strongest gains month-on-month were from the industrial subsector (+3.1%) and weakest performance at the hospitality subsector (-6.9%), says PhillipCapital research analyst Natalie Ong in an August 24 report.
On that, Ong has maintained her “overweight” call on the sector as she sees REITs as a “stable yield investment”.
Ong believes that S-REITs may emerge stronger with more future-ready portfolios, and a re-rating of the sector due to the acceptance of higher gearing levels, which will benefit REITs. The accelerated phasing in of future trends such as digitalisation will create more opportunities for landlords.
Ong also sees REITs as a tried and tested investment, as it remains an attractive yield play. Priced at lower levels, the yield for S-REITs spread at the -0.6 standard deviation (SD) level, and recovery in prices and low interest rates present a “conducive environment for acquisition,” she says.
“We like the commercial and industrial sub-sectors due to tapering office supply after the surge in supply in the prior two to three years, and the asset enhancement initiative (AEI) and redevelopment opportunities for the Industrial sector. The tenants in these two sectors are also less affected by the COVID-19 outbreak,” Ong adds.
“We are cautious on the hospitality and retail sub-sector due softer tourism sentiment and retail outlook, exacerbated by lingering fears of another wave of Covid-19 outbreak,” she says.
The research team at OCBC Investment Research has also maintained its “overweight” recommendation on the sector due to relatively undemanding valuations.
“We believe the worst is over after a difficult 1H20… though we remain cognizant on the uncertainties ahead,” they write in a August 24 report.
Expecting that the Fed will keep rates at near zero for up to the next five years, the team feels the “lower for longer” interest rate environment will continue to drive demand for good quality yield instruments for selective S-REITs.
“This hunt for yield theme has already resulted in the yield compression of the S-REITs sector. On an absolute basis, the FTSE Straits Time REIT Index (FSTREI) is currently trading at a blended forward distribution yield of 5.5%, which is 1.4 s.d. below its 10-year mean (6.2%),” it says.
However, the team warns that a low-interest-rate environment means there may be excessive risk-taking by corporates, although the Monetary Authority of Singapore (MAS) has imposed a regulatory gearing limit of 50% on S-REITs.
It also expects S-REITs to manage their capital prudently following the “lessons learnt” from the last Global Financial Crisis (GFC) in 2009.
“S-REITs currently have an aggregate leverage ratio of 36.7%, which not only provides a healthy buffer to the regulatory limit, but there is also ample debt headroom to pursue inorganic growth opportunities,” it says.
In 1H20, S-REITs reported a cumulative 27.8% dip y-o-y in their distributions per unit (DPU), with all major sub-sectors recording negative growth.
The hospitality, retail, office, and industrial sub-sectors fell 61.8% y-o-y, 45.1% y-o-y, 20% y-o-y, and 13.5% y-o-y respectively.
Of the REITs, only datacentres reported positive growth.
“Our revised projections for the current financial year (FY20/21F depending on financial year end) now point to a 10.1% decline in DPU on a market cap weighted basis. However, we expect to see a recovery by 15.4% in the next financial year (FY21/22F), in-line with expectations of an economic rebound,” says the team.
“We generally believe investors can view the glass as half full for the S-REITs sector over the medium-to-long-term horizon, but recognise the fact that there is still a myriad of near-term uncertainties as businesses and individuals adapt to the new norm and it would also take some effort and good luck for the water to reach the brim again,” it adds.
Top picks for the OCBC Research Investment team are Frasers Logistics & Commercial Trust (FLCT), Manulife US REIT (MUST), Mapletree North Asia Commercial Trust (MNACT), CapitaLand Mall Trust (CMT), and ESR-REIT with “buy” calls for all.
The team has priced each REIT with fair values of $1.59, 84 US cents, $1.09, $2.29, and 45 cents respectively.
PhillipCapital’s Ong has given “buy” calls on Ascott Residence Trust (ART), CMT, MUST, and Prime US REIT with target prices of $1.08, $2.33, 90 US cents, and 94 US cents respectively.
As at 4.30pm, units in ART are trading at 88.5 cents, CMT at $1.92, ESR-REIT at 38.5 cents, FLCT at $1.34, MNACT at 93.5 cents, MUST at 74.5 US cents, and Prime US REIT at 79 US cents.
Analysts maintain 'overweight' on S-REITs as sector remains a 'stable yield investment'
https://www.theedgesingapore.com/node/320617
Analysts are overall positive on Singapore REITs (S-REITs) following the worldwide fiscal and monetary stimulus from central banks, lowered interest rates, as well as the extended Jobs Support Scheme (JSS) unveiled on August 17.
The JSS will now provide 10% to 50% in wage subsidies for up to seven months from August depending on the project recovery of the different sectors.
For the hospitality and retail sectors – two of the harder-hit ones from the Covid-19 pandemic – local employees will receive wage support of 50% and 30% respectively, from 75% and 50% previously.
The government has also set up some $320 million in tourism credits to drive local spending to eateries, shops, hotels, and tourist attractions in Singapore.
As at August 24, the FTSE S-REIT Index was down 7.1% year-to-date (y-t-d), outperforming the Straits Times Index (STI) which registered a 18.9% decline y-t-d.
Strongest gains month-on-month were from the industrial subsector (+3.1%) and weakest performance at the hospitality subsector (-6.9%), says PhillipCapital research analyst Natalie Ong in an August 24 report.
On that, Ong has maintained her “overweight” call on the sector as she sees REITs as a “stable yield investment”.
Ong believes that S-REITs may emerge stronger with more future-ready portfolios, and a re-rating of the sector due to the acceptance of higher gearing levels, which will benefit REITs. The accelerated phasing in of future trends such as digitalisation will create more opportunities for landlords.
Ong also sees REITs as a tried and tested investment, as it remains an attractive yield play. Priced at lower levels, the yield for S-REITs spread at the -0.6 standard deviation (SD) level, and recovery in prices and low interest rates present a “conducive environment for acquisition,” she says.
“We like the commercial and industrial sub-sectors due to tapering office supply after the surge in supply in the prior two to three years, and the asset enhancement initiative (AEI) and redevelopment opportunities for the Industrial sector. The tenants in these two sectors are also less affected by the COVID-19 outbreak,” Ong adds.
“We are cautious on the hospitality and retail sub-sector due softer tourism sentiment and retail outlook, exacerbated by lingering fears of another wave of Covid-19 outbreak,” she says.
The research team at OCBC Investment Research has also maintained its “overweight” recommendation on the sector due to relatively undemanding valuations.
“We believe the worst is over after a difficult 1H20… though we remain cognizant on the uncertainties ahead,” they write in a August 24 report.
Expecting that the Fed will keep rates at near zero for up to the next five years, the team feels the “lower for longer” interest rate environment will continue to drive demand for good quality yield instruments for selective S-REITs.
“This hunt for yield theme has already resulted in the yield compression of the S-REITs sector. On an absolute basis, the FTSE Straits Time REIT Index (FSTREI) is currently trading at a blended forward distribution yield of 5.5%, which is 1.4 s.d. below its 10-year mean (6.2%),” it says.
However, the team warns that a low-interest-rate environment means there may be excessive risk-taking by corporates, although the Monetary Authority of Singapore (MAS) has imposed a regulatory gearing limit of 50% on S-REITs.
It also expects S-REITs to manage their capital prudently following the “lessons learnt” from the last Global Financial Crisis (GFC) in 2009.
“S-REITs currently have an aggregate leverage ratio of 36.7%, which not only provides a healthy buffer to the regulatory limit, but there is also ample debt headroom to pursue inorganic growth opportunities,” it says.
In 1H20, S-REITs reported a cumulative 27.8% dip y-o-y in their distributions per unit (DPU), with all major sub-sectors recording negative growth.
The hospitality, retail, office, and industrial sub-sectors fell 61.8% y-o-y, 45.1% y-o-y, 20% y-o-y, and 13.5% y-o-y respectively.
Of the REITs, only datacentres reported positive growth.
“Our revised projections for the current financial year (FY20/21F depending on financial year end) now point to a 10.1% decline in DPU on a market cap weighted basis. However, we expect to see a recovery by 15.4% in the next financial year (FY21/22F), in-line with expectations of an economic rebound,” says the team.
“We generally believe investors can view the glass as half full for the S-REITs sector over the medium-to-long-term horizon, but recognise the fact that there is still a myriad of near-term uncertainties as businesses and individuals adapt to the new norm and it would also take some effort and good luck for the water to reach the brim again,” it adds.
Top picks for the OCBC Research Investment team are Frasers Logistics & Commercial Trust (FLCT), Manulife US REIT (MUST), Mapletree North Asia Commercial Trust (MNACT), CapitaLand Mall Trust (CMT), and ESR-REIT with “buy” calls for all.
The team has priced each REIT with fair values of $1.59, 84 US cents, $1.09, $2.29, and 45 cents respectively.
PhillipCapital’s Ong has given “buy” calls on Ascott Residence Trust (ART), CMT, MUST, and Prime US REIT with target prices of $1.08, $2.33, 90 US cents, and 94 US cents respectively.
As at 4.30pm, units in ART are trading at 88.5 cents, CMT at $1.92, ESR-REIT at 38.5 cents, FLCT at $1.34, MNACT at 93.5 cents, MUST at 74.5 US cents, and Prime US REIT at 79 US cents.
Shion
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Sabana-ESR Reits merger: MAS says safeguards in place against conflicts of interest
Sabana-ESR Reits merger: MAS says safeguards in place against conflicts of interest
https://www.straitstimes.com/busine...-says-safeguards-in-place-against-conflict-of
SINGAPORE (THE BUSINESS TIMES) - The Monetary Authority of Singapore (MAS) on Friday (Aug 28) clarified that its regulatory framework does not prohibit a shareholder group from owning substantial stakes in two real estate investment trust (Reit) managers managing Reits invested in the same property class.
This was in response to queries about the proposed merger of Sabana Shari'ah Compliant Industrial Real Estate Investment Trust (Sabana Reit) and ESR-Reit, whose managers have the same sponsor, ESR Cayman.
Minority unitholders including Quarz Capital Management and Black Crane Capital had claimed there might be potential "severe" conflicts of interest arising from ESR Cayman's controlling ownership of both managers, among other concerns about the merger.
The unitholders last week wrote to MAS and Singapore Exchange Regulation, "urgently" seeking guidance on how to resolve the alleged conflict.
On Friday, MAS pointed out that there are regulatory safeguards under the Securities and Futures Act to mitigate potential conflicts of interest.
For instance, independent directors must make up at least half of boards of Reit managers where unitholders do not have the right to appoint directors.
For Sabana, its manager's board is composed entirely of independent directors, with no representation of directors from either the sponsor ESR Cayman or the ESR-Reit manager, the Sabana manager clarified in a bourse filing on Friday.
There is also no overlap of management teams between the Sabana manager and the ESR-Reit manager.
Another regulatory safeguard MAS noted was that Reit managers and their directors have a legal obligation to act in the best interests of unitholders, and prioritise unitholders' interests over those of the manager and its shareholders.
In its filing, the Sabana manager said that the board is proposing the merger by way of a trust scheme of arrangement for the consideration of independent unitholders, "in accordance with its fiduciary duties".
A trust scheme of arrangement is a "fair and equitable" way of effecting the merger, as it will provide a binary outcome - "all or nothing" - for the proposal, the manager added.
MAS said that it may require financial institutions to put in place additional measures to address specific risks where needed, including that of conflicts of interest.
"We have done so in the case of ESR-Reit and Sabana Reit," the financial regulator added.
MAS also noted that only the Sabana unitholders who are independent have a say in whether to approve or reject the proposed merger based on the financial terms negotiated and put forth by the Reit managers.
The scheme requires the approval by a majority in number of independent unitholders representing at least 75 per cent in value of the units held by those present and voting.
Those abstaining from voting on the scheme are ESR-Reit's manager, its concert parties and the common substantial unitholders of both Reits - including ESR Cayman, which holds 20.88 per cent of Sabana; Chinese billionaire Tong Jinquan, who holds 3.3 per cent; Wealthy Fountain Holdings; and e-Shang Infinity Cayman.
The Sabana manager will also abstain from voting on the scheme, pursuant to listing rules.
Moreover, the scheme will require court sanction before it can become effective, which serves as "additional protection" for independent Sabana unitholders, the manager said.
It added that its board went through a "thorough" process to evaluate the terms of the merger, involving "lengthy and careful deliberations" with its management team as well as financial advisers engaged to evaluate the commercial terms.
"The merger terms were arrived at after extensive negotiations between the Sabana manager and the ESR-Reit manager," said the former.
The board of the Sabana manager also highlighted that the proposed merger was the only formal offer it had ever received.
Deloitte & Touche Corporate Finance is the appointed independent financial adviser to advise the independent directors of the Sabana manager and its trustee on the scheme.
MAS on Friday emphasised that Singapore's regulatory framework governing mergers and takeovers is well-established and ensures that shareholders or unitholders are given sufficient information, independent advice and time to consider and decide on the offer.
Both MAS and the Sabana manager separately encouraged unitholders to carefully study the trust scheme document, including the assessment and advice of the independent financial adviser, in deciding on their votes on the merger.
Sabana units rose 0.5 cent or 1.4 per cent to trade at 37.5 cents as at 10.11am on Friday, while ESR-Reit units were flat at 38.5 cents.
Sabana-ESR Reits merger: MAS says safeguards in place against conflicts of interest
https://www.straitstimes.com/busine...-says-safeguards-in-place-against-conflict-of
SINGAPORE (THE BUSINESS TIMES) - The Monetary Authority of Singapore (MAS) on Friday (Aug 28) clarified that its regulatory framework does not prohibit a shareholder group from owning substantial stakes in two real estate investment trust (Reit) managers managing Reits invested in the same property class.
This was in response to queries about the proposed merger of Sabana Shari'ah Compliant Industrial Real Estate Investment Trust (Sabana Reit) and ESR-Reit, whose managers have the same sponsor, ESR Cayman.
Minority unitholders including Quarz Capital Management and Black Crane Capital had claimed there might be potential "severe" conflicts of interest arising from ESR Cayman's controlling ownership of both managers, among other concerns about the merger.
The unitholders last week wrote to MAS and Singapore Exchange Regulation, "urgently" seeking guidance on how to resolve the alleged conflict.
On Friday, MAS pointed out that there are regulatory safeguards under the Securities and Futures Act to mitigate potential conflicts of interest.
For instance, independent directors must make up at least half of boards of Reit managers where unitholders do not have the right to appoint directors.
For Sabana, its manager's board is composed entirely of independent directors, with no representation of directors from either the sponsor ESR Cayman or the ESR-Reit manager, the Sabana manager clarified in a bourse filing on Friday.
There is also no overlap of management teams between the Sabana manager and the ESR-Reit manager.
Another regulatory safeguard MAS noted was that Reit managers and their directors have a legal obligation to act in the best interests of unitholders, and prioritise unitholders' interests over those of the manager and its shareholders.
In its filing, the Sabana manager said that the board is proposing the merger by way of a trust scheme of arrangement for the consideration of independent unitholders, "in accordance with its fiduciary duties".
A trust scheme of arrangement is a "fair and equitable" way of effecting the merger, as it will provide a binary outcome - "all or nothing" - for the proposal, the manager added.
MAS said that it may require financial institutions to put in place additional measures to address specific risks where needed, including that of conflicts of interest.
"We have done so in the case of ESR-Reit and Sabana Reit," the financial regulator added.
MAS also noted that only the Sabana unitholders who are independent have a say in whether to approve or reject the proposed merger based on the financial terms negotiated and put forth by the Reit managers.
The scheme requires the approval by a majority in number of independent unitholders representing at least 75 per cent in value of the units held by those present and voting.
Those abstaining from voting on the scheme are ESR-Reit's manager, its concert parties and the common substantial unitholders of both Reits - including ESR Cayman, which holds 20.88 per cent of Sabana; Chinese billionaire Tong Jinquan, who holds 3.3 per cent; Wealthy Fountain Holdings; and e-Shang Infinity Cayman.
The Sabana manager will also abstain from voting on the scheme, pursuant to listing rules.
Moreover, the scheme will require court sanction before it can become effective, which serves as "additional protection" for independent Sabana unitholders, the manager said.
It added that its board went through a "thorough" process to evaluate the terms of the merger, involving "lengthy and careful deliberations" with its management team as well as financial advisers engaged to evaluate the commercial terms.
"The merger terms were arrived at after extensive negotiations between the Sabana manager and the ESR-Reit manager," said the former.
The board of the Sabana manager also highlighted that the proposed merger was the only formal offer it had ever received.
Deloitte & Touche Corporate Finance is the appointed independent financial adviser to advise the independent directors of the Sabana manager and its trustee on the scheme.
MAS on Friday emphasised that Singapore's regulatory framework governing mergers and takeovers is well-established and ensures that shareholders or unitholders are given sufficient information, independent advice and time to consider and decide on the offer.
Both MAS and the Sabana manager separately encouraged unitholders to carefully study the trust scheme document, including the assessment and advice of the independent financial adviser, in deciding on their votes on the merger.
Sabana units rose 0.5 cent or 1.4 per cent to trade at 37.5 cents as at 10.11am on Friday, while ESR-Reit units were flat at 38.5 cents.
Shion
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- Oct 24, 2008
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SGX gives nod for CMT to list up to 2.78b new units, CCT to delist
SGX gives nod for CMT to list up to 2.78b new units, CCT to delist
https://www.businesstimes.com.sg/co...mt-to-list-up-to-278b-new-units-cct-to-delist
THE Singapore Exchange (SGX) on Friday granted in-principle approval to CapitaLand Mall Trust (CMT) for the listing of up to 2.78 billion new units as part consideration for its merger by way of a trust scheme with CapitaLand Commercial Trust (CCT), CMT's manager said in a bourse filing on Monday.
SGX on Friday also advised that it has no objection to the proposed delisting of CCT, subject to the trust scheme becoming effective, CCT's manager said on Monday.
SGX's in-principle approval for the listing of the new CMT units is subject to compliance with listing requirements for the units, court approval of the implementation of the trust scheme, and the approval of CMT's independent unitholders for all the resolutions necessary to effect the merger.
CMT's manager said further details on the merger, the trust scheme and the related transactions will be set out in a circular to unitholders to be issued in due course, together with a notice to convene an extraordinary general meeting.
Units of CMT ended Friday at S$1.90, up S$0.04 or 2.2 per cent. Units of CCT finished at S$1.64, up S$0.04 or 2.5 per cent.
SGX gives nod for CMT to list up to 2.78b new units, CCT to delist
https://www.businesstimes.com.sg/co...mt-to-list-up-to-278b-new-units-cct-to-delist
THE Singapore Exchange (SGX) on Friday granted in-principle approval to CapitaLand Mall Trust (CMT) for the listing of up to 2.78 billion new units as part consideration for its merger by way of a trust scheme with CapitaLand Commercial Trust (CCT), CMT's manager said in a bourse filing on Monday.
SGX on Friday also advised that it has no objection to the proposed delisting of CCT, subject to the trust scheme becoming effective, CCT's manager said on Monday.
SGX's in-principle approval for the listing of the new CMT units is subject to compliance with listing requirements for the units, court approval of the implementation of the trust scheme, and the approval of CMT's independent unitholders for all the resolutions necessary to effect the merger.
CMT's manager said further details on the merger, the trust scheme and the related transactions will be set out in a circular to unitholders to be issued in due course, together with a notice to convene an extraordinary general meeting.
Units of CMT ended Friday at S$1.90, up S$0.04 or 2.2 per cent. Units of CCT finished at S$1.64, up S$0.04 or 2.5 per cent.
Shion
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Why FCT, CMT, Lendlease Global Commercial REIT will do well ahead: DBS
Why FCT, CMT, Lendlease Global Commercial REIT will do well ahead: DBS
https://www.theedgesingapore.com/ca...global-commercial-reit-will-do-well-ahead-dbs
As shoppers appear to be flocking back in search of attractive bargains, the performance of real estate investment trusts (REITs) that own suburban malls is likely to improve, according to DBS Group Research.
This has led the brokerage to select Frasers Centrepoint Trust (FCT), CapitaLand Mall Trust (CMT) and Lendlease Global Commercial REIT as its top picks.
The brokerage has a “buy” rating for FCT, CMT and Lendlease with target price of $2.95, $2.40 and 85 cents, respectively.
“We continue to place our bets on malls with suburban characteristics,” DBS analyst Derek Tan and the research team write in a note dated Aug 31.
According to DBS’ car park tracker and weekly site visits, malls are seeing steady foot traffic and the return of queues at restaurants.
The brokerage points out that car park vacancies are stabilising at about 27% within Orchard malls and about 35% across suburban malls.
This has led DBS to believe that the “tide has turned” and that these encouraging signs will continue ahead.
“We believe that with borders yet to be reopened, consumers may open their wallets at our local malls, catalysed by attractive marketing and discounts offered by retailers,” say Tan and the research team.
“The worst is over, but the recovery is just underway,” they add.
As at 10.19 am, FCT was up 4 cents or 1.6% at $2.51 with 217,000 units changed hands.
CMT was up 0.5 cent or 2.6% at $1.95 with 4.2 million units changed hands.
Lendlease was up 0.5 cent or 0.8% at 64.5 cents with 199,400 units changed hands.
Why FCT, CMT, Lendlease Global Commercial REIT will do well ahead: DBS
https://www.theedgesingapore.com/ca...global-commercial-reit-will-do-well-ahead-dbs
As shoppers appear to be flocking back in search of attractive bargains, the performance of real estate investment trusts (REITs) that own suburban malls is likely to improve, according to DBS Group Research.
This has led the brokerage to select Frasers Centrepoint Trust (FCT), CapitaLand Mall Trust (CMT) and Lendlease Global Commercial REIT as its top picks.
The brokerage has a “buy” rating for FCT, CMT and Lendlease with target price of $2.95, $2.40 and 85 cents, respectively.
“We continue to place our bets on malls with suburban characteristics,” DBS analyst Derek Tan and the research team write in a note dated Aug 31.
According to DBS’ car park tracker and weekly site visits, malls are seeing steady foot traffic and the return of queues at restaurants.
The brokerage points out that car park vacancies are stabilising at about 27% within Orchard malls and about 35% across suburban malls.
This has led DBS to believe that the “tide has turned” and that these encouraging signs will continue ahead.
“We believe that with borders yet to be reopened, consumers may open their wallets at our local malls, catalysed by attractive marketing and discounts offered by retailers,” say Tan and the research team.
“The worst is over, but the recovery is just underway,” they add.
As at 10.19 am, FCT was up 4 cents or 1.6% at $2.51 with 217,000 units changed hands.
CMT was up 0.5 cent or 2.6% at $1.95 with 4.2 million units changed hands.
Lendlease was up 0.5 cent or 0.8% at 64.5 cents with 199,400 units changed hands.
unclebutcher
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What happened to first reit
NewInvestor
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- Dec 17, 2014
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DBS didn't mention MCT
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