General S-REITs Discussion Thread

[winorlose]

careful of rights or placement

CapitaCommercial Trust seen buying rest of CapitaGreen in 2H2016

By Frankie Ho / theedgemarkets.com | March 24, 2015 : 5:04 PM MYT
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SINGAPORE (March 24): CapitaCommercial Trust (CCT) could acquire the rest of CapitaGreen, a 40-storey prime office building in Singapore's central business district, it does not already own in 2H2016 for about $1.1 billion to $1.2 billion, according to UOB Kay Hian.

The property, located at 138 Market Street, is jointly developed by CCT, CapitaLand and Mitsubishi Estate Asia, and has a net lettable area of about 700,000 sq ft. CCT has a 40% stake in the project.

"We believe management is looking to balance income accretion (minimal in 2015) and overall office valuations (higher signing rents could spur an uptick in CapitaGreen’s valuations)," UOB Kay Hian analysts Vikrant Pandey and Derek Chang wrote in a note today.

"Our visit to the recently-completed CapitaGreen reinforces our view of its role as a key growth driver for CapitaCommercial Trust," they said.

"With pre-commitment at levels near 70%, leasing enquiries remain strong, particularly from non-traditional players."

These include companies in the technology, media and telecommunications sectors.

Based on a gearing limit of 40%, CCT can borrow $1.2 billion to fund the acquisition, they said.

UOB Kay Hian has a "buy" call and $2.06 price target on CCT.

CCT shares were up 0.6% at $1.755.

Huat ah!! Normally before such mkt actions.. Price will move very high

 

[Paul Lee]

http://www.propertyguru.com.sg/prop...residential-projects-running-out-of-time-repo

Time is running out for at least five private residential projects to sell their unsold units before their developer is slapped with hefty fines under the Qualifying Certificate (QC) rules, according to a report from Square Foot Research.

“These developments were completed in 2013 and have less than a year to meet stringent QC requirements,” it said.

The projects listed by Square Foot Research are The Interlace (pictured), GoodWood Residence iLiv @ Grange, Urban Resort Condo and Ei8ht Raja.

This has more impact to the bona fide listed property companies than REIT.

Actually this was one of the reason why Popular goes private because they were screwed over Ei8ht Raja.

 

[winguy]

Hi qn. What will happen to reits when the land lease is expiring?

Does this mean industrial reits are less attrative?
http://www.investmentmoats.com/money-management/reit/reits-land-lease-renewal-and-extension/

 

[Paul Lee]

Either they need to fork out money to extend the lease (subject to approval from the relevant authority) or the land reverts back to the state.

Most industrial sites has a short lease period of 30 yrs. So yes for that reason its less attractive and by extension why in general industrial REITs offer higher yield than office and retail REITs.

 

[felixleong]

Hi qn. What will happen to reits when the land lease is expiring?

Does this mean industrial reits are less attrative?
http://www.investmentmoats.com/money-management/reit/reits-land-lease-renewal-and-extension/

expire = become worthless

that's why its important to go for quality assets

if a property has 99 years, using straight line depreciation... u only lose around 1% per year

those with short lease, are very risky

 

[Geforce3]

Wonder if there are any good Reits to pick up? Acendas Reit ok?

 

[Athelia]

better to hoot cmt or cct? thx

either one is fine imo, depends on what you're looking for pretty much

 

[wahkao3]

Wonder if there are any good Reits to pick up? Acendas Reit ok?

i posted last time that REITS are not a good buy
=============================

2015 Jan-Some SGX property stocks present good value now

There are some good cheap SGX property stocks right now and they are good value. This is because of the cooling measure, prices came down and you have a golden opportunity to pick them up on the cheap


but REITs are not good value. They are fairly priced. in investment, we dont buy assets at fair price, we buy assets are undervalue. So REITs dont present good value

as usual, i can be wrong, so do your own homework! Dont follow my tips blindly

Source:http://forums.hardwarezone.com.sg/s...sent-good-value-now-4948596.html#post91555931

 

[StealthNinja]

any thoughts on suntec reit at current yield 5.5% and 3rd phrase haven open yet will see yield up again once open..

 

[winguy]

What are the ways a mature reit can extend is weighted average property leasehold expiry?

If there are ways then industrial reits with its shorter leasehold period of 30 years are not necessarily worse.

Sorry for the noob qn if it is noob

 

[felixleong]

What are the ways a mature reit can extend is weighted average property leasehold expiry?

If there are ways then industrial reits with its shorter leasehold period of 30 years are not necessarily worse.

Sorry for the noob qn if it is noob

can take a look at soil build reit

their WAPL is around 50 years

 

[felixleong]

any thoughts on suntec reit at current yield 5.5% and 3rd phrase haven open yet will see yield up again once open..

office rentals already ran up a lot over the last few years

same for office reits... if u now go in, its really towards the high side

 

[WindBoi]

Hi qn. What will happen to reits when the land lease is expiring?

Does this mean industrial reits are less attrative?
http://www.investmentmoats.com/money-management/reit/reits-land-lease-renewal-and-extension/

as a general idea the reit or another company have to foot to extend the land lease. the amount will depend.

in the case of first reit in indoensia, their one hospital can sit on many land lease that is 30 years + 20 years of extension. however the cost to renew or extend is liek a few thousand dollars.

that is not the case in singapore.

take the case of soilbuild recent purchase with a 23 year land lease. they calculated the IRR to be worth it. justifiable ? i am up on the fence on this. i invested in toll roads that is 15-20 years, and ships that is 25- 30 years so i tend to think IRR if done conservatively is acceptable.

look at it as something not evergreen. usually if the land lease is short, ishould expect a higher yearly return.

 

[felixleong]

as a general idea the reit or another company have to foot to extend the land lease. the amount will depend.

in the case of first reit in indoensia, their one hospital can sit on many land lease that is 30 years + 20 years of extension. however the cost to renew or extend is liek a few thousand dollars.

that is not the case in singapore.

take the case of soilbuild recent purchase with a 23 year land lease. they calculated the IRR to be worth it. justifiable ? i am up on the fence on this. i invested in toll roads that is 15-20 years, and ships that is 25- 30 years so i tend to think IRR if done conservatively is acceptable.

look at it as something not evergreen. usually if the land lease is short, ishould expect a higher yearly return.

btw for the case of toll roads I don't understand... with just 20 years life span... isn't 5% yield just too low??? you are just getting your $$ money back...
would u need like 10% or higher to justify?

http://forums.hardwarezone.com.sg/s...t-pacific-cmpacific-3620175.html#post92774733

for ships, usually the yield is pretty high.. like 10% possible.. the problems comes when their life span is about to end and NAV plunges... leading to rights issue or placements to stay afloat...

 

[winguy]

I still feel that managing individual stocks is not passive.

What if when you are 80 years old there is a rights issue, change in law, expiring leasehold property, etc.

What if 1 day after you pass away any of the above or something else happens? Will your spouse (at 80 years old) or children know how to manage?

To me it seems a bad idea to manage individual stocks unless it is ingrained in your family...

 

[havetheveryfun]

I still feel that managing individual stocks is not passive.

What if when you are 80 years old there is a rights issue, change in law, expiring leasehold property, etc.

What if 1 day after you pass away any of the above or something else happens? Will your spouse (at 80 years old) or children know how to manage?

To me it seems a bad idea to manage individual stocks unless it is ingrained in your family...

then u can just ask them to sell away all your stocks and cash in the money for their future use.. not everyone is into stocks anyway.

and if ur already 80.. why care about what you have left behind for your family ? your children all should already be grown up and be able to take care of themselves

 

[felixleong]

I still feel that managing individual stocks is not passive.

What if when you are 80 years old there is a rights issue, change in law, expiring leasehold property, etc.

What if 1 day after you pass away any of the above or something else happens? Will your spouse (at 80 years old) or children know how to manage?

To me it seems a bad idea to manage individual stocks unless it is ingrained in your family...

you can always hire professional managers to do the work for you

 

[Dividends Warrior]

I still feel that managing individual stocks is not passive.

What if when you are 80 years old there is a rights issue, change in law, expiring leasehold property, etc.

What if 1 day after you pass away any of the above or something else happens? Will your spouse (at 80 years old) or children know how to manage?

To me it seems a bad idea to manage individual stocks unless it is ingrained in your family...

That's why Warren Buffett tells his future generations to just put his family wealth in a low-cost ETF. His offsprings are incapable of managing his empire.

 

[winguy]

That's why Warren Buffett tells his future generations to just put his family wealth in a low-cost ETF. His offsprings are incapable of managing his empire.

Qn for us, then why not start in this generation? Pls enlighten. Because you cant resist the excitement and adrenaline?

 

[felixleong]

its hard to beat the market being an active stock picker

for most people, being the market is good enough

and its easy to do

just invest in the index