MapleTree NAC Trust

[Chua Zhiming]

Means insurance may not cover full loss, and dont know when the insurance benefit will be paid out??

"The Distribution Top-Up amount, based on approximately 40% of the Festival Walk Retail Revenue, will be included in the capital component of the distributable income payable for each of the aforementioned distribution periods and funded by external borrowings.

Once the insurance claims proceeds are received, the same will be used to repay the external borrowings incurred to fund the Distribution Top-Up and the balance will be distributed as part of the distributable income payable to Unitholders, in the payment period following the receipt of the insurance
claims proceeds."

They are borrowing externally to provide 40% of FW retail revenue which will incur additional interest costs until the insurance payout. Hope the insurance payout will be sufficient to cover these interest costs too.

 

[Paul Lee]

Am I the only one who is horrified by this reckless move by Mapletree?

External borrowing to top up distributions seems like a bonehead move to me.

Wouldn't it make more sense to take a hit at the distribution now? And then to distribute the insurance payout later? This is definitely more prudent and will incur less cost.

I have to admit that my confidence in Mapletree is a little shaken with this decision.

(Not vested)

 

[NewInvestor]

Am I the only one who is horrified by this reckless move by Mapletree?

External borrowing to top up distributions seems like a bonehead move to me.

Wouldn't it make more sense to take a hit at the distribution now? And then to distribute the insurance payout later? This is definitely more prudent and will incur less cost.

I have to admit that my confidence in Mapletree is a little shaken with this decision.

(Not vested)

No question that this move is not conventional. However, the message that they are trying to send is that with Mapletree as sponsor, investors will benefit....

It is good for their reputation. When Mapletree launch their next REIT, there will be a lot of subscribers.....

 

[$warrior]

Am I the only one who is horrified by this reckless move by Mapletree?

External borrowing to top up distributions seems like a bonehead move to me.

Wouldn't it make more sense to take a hit at the distribution now? And then to distribute the insurance payout later? This is definitely more prudent and will incur less cost.

I have to admit that my confidence in Mapletree is a little shaken with this decision.

(Not vested)

No worries, Paul, you're not vested so does not affect you!

 

[Oppa380]

Am I the only one who is horrified by this reckless move by Mapletree?

External borrowing to top up distributions seems like a bonehead move to me.

Wouldn't it make more sense to take a hit at the distribution now? And then to distribute the insurance payout later? This is definitely more prudent and will incur less cost.

I have to admit that my confidence in Mapletree is a little shaken with this decision.

(Not vested)

the more important question is when can buy

 

[$warrior]

the more important question is when can buy

when there is blood in the streets!

 

[Guojing88]

Am I the only one who is horrified by this reckless move by Mapletree?

External borrowing to top up distributions seems like a bonehead move to me.

Wouldn't it make more sense to take a hit at the distribution now? And then to distribute the insurance payout later? This is definitely more prudent and will incur less cost.

I have to admit that my confidence in Mapletree is a little shaken with this decision.

(Not vested)

The fact that the manager compensation is linked to rising DPU is probably the main reason why this is done.

 

[assiak71]

The fact that the manager compensation is linked to rising DPU is probably the main reason why this is done.

But it is already a definite drop in dpu.
Wouldnt a bigger drop now mean a bigger increase later meaning more compensation later. By cushioning it now it will be a smaller increase later

 

[Guojing88]

But it is already a definite drop in dpu.
Wouldnt a bigger drop now mean a bigger increase later meaning more compensation later. By cushioning it now it will be a smaller increase later

I don't think the calculation of the compensation is that straightforward.

Its better to have a consistent DPU rather than volatile DPU.

 

[lzydata]

The fact that the manager compensation is linked to rising DPU is probably the main reason why this is done.

The trust's base fee is 10% of the annual distributable income and performance fee is 25% of the excess DPU over the previous year.

Unless they borrow enough to totally replace the lost DPU, the manager is definitely going to take a hit. I don't think they will borrow that much, even if the banks let them.

 

[lasnoblur]

Am I the only one who is horrified by this reckless move by Mapletree?

External borrowing to top up distributions seems like a bonehead move to me.

Wouldn't it make more sense to take a hit at the distribution now? And then to distribute the insurance payout later? This is definitely more prudent and will incur less cost.

I have to admit that my confidence in Mapletree is a little shaken with this decision.

(Not vested)

Not vested too.

this move by mapletree also make me think thrice about investing in their equities in the future.

 

[yoongmy]

investment manager may look at the dpu stability. in long run I think this is a good move.

 

[$warrior]

All the mastars' speculation - why not let the management do what they are about to do and then decide on the quality of the move?

 

[articland05]

not vested

but i think u guys worry too much. this is mapletree we r talking abt..not urban commons of eagle htrust.

Sent from LGE LG-H990 using GAGT

 

[Paul Lee]

not vested

but i think u guys worry too much. this is mapletree we r talking abt..not urban commons of eagle htrust.

I will say the worst thing than 'worrying too much' is not worrying enough and possibly even worst - blind faith.

As investors of REITs, we should always be vigilant about the action of the trustee manager. And how their actions can have an impact on DPU and ultimately the REIT unit price.

And while I do agree that Mapletree has demonstrated their capabilities as trust manager in the past with their portfolio of listed REITs, nonetheless we should not take that as infallibility.

Only time will time I guess.

 

[articland05]

mapletree steady bom pi pi huan...
noes worries...

Sent from LGE LG-H990 using GAGT

 

[deadguy00]

The dumb hk cockroaches will still cont their protests. Don think festival walk will open anytime soon

Sent from Samsung SM-N950F using GAGT

 

[DawnRisingSun]

Finally re-opened and it looks like more like a prison gosh

 

[Paul Lee]

Not quite.

All efforts are currently being made to re-open the mall on 16 January 2020, ahead of the Lunar New Year festive season. Some of the repair and replacement works are expected to continue within the mall after it re-opens. The Manager will provide further updates in due course.

SOURCE: UPDATE ON FESTIVAL WALK

 

[lzydata]

EGM for the Japan acquisitions is coming, 20 January Monday. No doubt some folks will also want to ask about the status of Festival Walk too