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Wake up call
this reit costs of debt is 4.8%. Dun know how they get themselves into such a high amount of interest to pay
Many China properties changed hand with prices < 50% of 2023~~~~~~ this divestment looks decent.
Think so too:
" With the REIT now trading at a 55% discount to its NAV, it is " looking interesting" given how it has " de-risked" its overall income profile, says DBS. "
" With the REIT now trading at a 55% discount to its NAV, it is " looking interesting" given how it has " de-risked" its overall income profile, says DBS. "
Joelton ( Date: 24-Dec-2024 09:22) Posted:
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DBS sees OUE REIT' s divestment of Shanghai property a positive move
DBS Group Research has kept its " buy" call and 33 cents target price on OUE REIT TS0U after the proposed sale of its stake in a Shanghai property.
According to OUE REIT on Dec 20, it plans to divest its 91.2% stake in Lippo Plaza Shanghai for RMB 1.92 billion ($357 million) and at an agreed property value of RMB 1.68 billion.
The agreed property value is at a discount of 5% to the last independent valuation of RMB 1.77 billion conducted in December, which is a 30% drop from the value of RMB 2.4 billion accorded a year earlier.
" The property&rsquo s shortening leasehold tenure and vintage building specifications have started to impact its valuation and competitiveness, especially with the current supply overhang in the Shanghai market," says Han Khim Siew, CEO of the REIT' s manager.
" The stewardship of Lippo Plaza has now been entrusted to a committed long-term investor attracted by the property&rsquo s very prime location," he adds.
In its Dec 23 note, DBS observes that the ongoing oversupply and weak operating climate in China have resulted in continued weakness in leasing and transaction velocity in Shanghai, even for a prime location that Lippo Plaza Shanghai is located in.
Lippo Plaza Shanghai is the REIT' s sole asset in this market - one where OUE REIT has no plans for further expansion. The property formed around 6.6% of the REIT&rsquo s portfolio value.
DBS views this proposed sale as positive for OUE REIT, as it can now be a " unique pure-play Singapore commercial REIT" .
" While divestment at a discount is painful in our opinion, the exit yield, based on the FY2023 net property income is estimated to be around 5.7% and is expected to drive a 1.4% accretion to DPU, if the funds were utilised towards repaying debt.
DBS estimates that if proceeds were used to pay down debt, OUE REIT' s gearing would ease to 35% which gives it the room to make new acquisitions.
It estimates that the impact on the REIT' s NAV is marginal - from 60 cents per unit to 59 cents.
With the REIT now trading at a 55% discount to its NAV, it is " looking interesting" given how it has " de-risked" its overall income profile, says DBS.
DBS sees OUE REIT's divestment of Shanghai property a positive move
The Edge Singapore
Mon, Dec 23, 2024 ? 12:23 PM GMT+08 ? 2 min read
DBS sees OUE REIT's divestment of Shanghai property a positive move
DBS Group Research has kept its "buy" call and 33 cents target price on OUE REIT TS0Uafter the proposed sale of its stake in a Shanghai property.
According to OUE REIT on Dec 20, it plans to divest its 91.2% stake in Lippo Plaza Shanghai for RMB 1.92 billion ($357 million) and at an agreed property value of RMB 1.68 billion.
The agreed property value is at a discount of 5% to the last independent valuation of RMB 1.77 billion conducted in December, which is a 30% drop from the value of RMB 2.4 billion accorded a year earlier.
"The property?s shortening leasehold tenure and vintage building specifications have started to impact its valuation and competitiveness, especially with the current supply overhang in the Shanghai market," says Han Khim Siew, CEO of the REIT's manager.
"The stewardship of Lippo Plaza has now been entrusted to a committed long-term investor attracted by the property?s very prime location," he adds.
In its Dec 23 note, DBS observes that the ongoing oversupply and weak operating climate in China have resulted in continued weakness in leasing and transaction velocity in Shanghai, even for a prime location that Lippo Plaza Shanghai is located in.
Lippo Plaza Shanghai is the REIT's sole asset in this market - one where OUE REIT has no plans for further expansion. The property formed around 6.6% of the REIT?s portfolio value.
DBS views this proposed sale as positive for OUE REIT, as it can now be a "unique pure-play Singapore commercial REIT".
"While divestment at a discount is painful in our opinion, the exit yield, based on the FY2023 net property income is estimated to be around 5.7% and is expected to drive a 1.4% accretion to DPU, if the funds were utilised towards repaying debt.
DBS estimates that if proceeds were used to pay down debt, OUE REIT's gearing would ease to 35% which gives it the room to make new acquisitions.
It estimates that the impact on the REIT's NAV is marginal - from 60 cents per unit to 59 cents.
With the REIT now trading at a 55% discount to its NAV, it is "looking interesting" given how it has "de-risked" its overall income profile, says DBS.
OUE REIT units changed hands at 28 cents as at 12.10 pm, up 3.7% thus far today.
The Edge Singapore
Mon, Dec 23, 2024 ? 12:23 PM GMT+08 ? 2 min read
DBS sees OUE REIT's divestment of Shanghai property a positive move
DBS Group Research has kept its "buy" call and 33 cents target price on OUE REIT TS0Uafter the proposed sale of its stake in a Shanghai property.
According to OUE REIT on Dec 20, it plans to divest its 91.2% stake in Lippo Plaza Shanghai for RMB 1.92 billion ($357 million) and at an agreed property value of RMB 1.68 billion.
The agreed property value is at a discount of 5% to the last independent valuation of RMB 1.77 billion conducted in December, which is a 30% drop from the value of RMB 2.4 billion accorded a year earlier.
"The property?s shortening leasehold tenure and vintage building specifications have started to impact its valuation and competitiveness, especially with the current supply overhang in the Shanghai market," says Han Khim Siew, CEO of the REIT's manager.
"The stewardship of Lippo Plaza has now been entrusted to a committed long-term investor attracted by the property?s very prime location," he adds.
In its Dec 23 note, DBS observes that the ongoing oversupply and weak operating climate in China have resulted in continued weakness in leasing and transaction velocity in Shanghai, even for a prime location that Lippo Plaza Shanghai is located in.
Lippo Plaza Shanghai is the REIT's sole asset in this market - one where OUE REIT has no plans for further expansion. The property formed around 6.6% of the REIT?s portfolio value.
DBS views this proposed sale as positive for OUE REIT, as it can now be a "unique pure-play Singapore commercial REIT".
"While divestment at a discount is painful in our opinion, the exit yield, based on the FY2023 net property income is estimated to be around 5.7% and is expected to drive a 1.4% accretion to DPU, if the funds were utilised towards repaying debt.
DBS estimates that if proceeds were used to pay down debt, OUE REIT's gearing would ease to 35% which gives it the room to make new acquisitions.
It estimates that the impact on the REIT's NAV is marginal - from 60 cents per unit to 59 cents.
With the REIT now trading at a 55% discount to its NAV, it is "looking interesting" given how it has "de-risked" its overall income profile, says DBS.
OUE REIT units changed hands at 28 cents as at 12.10 pm, up 3.7% thus far today.
Factored in, that' s why this level. Accumulate on news. :)
In FY23, Lippo Plaze was valued at $449 million. Looks like there will be a substantial accounting losses in the coming FY.
Wise move.
Overdue for a relief rally.
Overdue for a relief rally.
Joelton ( Date: 21-Dec-2024 11:31) Posted:
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Time to buy? This Reit like nobody interested for some reason.
One of the main issue for OUE Reit is the low occupancy rate at Lippo Shanghai, to my view this is very good news for the shareholders ....
Joelton ( Date: 21-Dec-2024 11:31) Posted:
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OUE Reit divests entire stake in Shanghai office property
It is expected to reap net proceeds of about S$318.2 million from the transaction
OUE Real Estate Investment Trust : TS0U -1.82% (Reit) is set to sell its entire stake in Lippo Realty, a real estate service provider that manages and operates an office building in Shanghai, to an unrelated entity for 1.9 billion yuan (S$357.4 million), said its manager in a bourse filing on Friday (Dec 20).
Both the seller and buyer came to an agreement that the 36-storey Grade A commercial building, known as Lippo Plaza, has a property value of 1.7 billion yuan, about 5 per cent below its independent valuation of 1.8 billion yuan.
Against the agreed property value, as well as Lippo Plaza&rsquo s net property income of 94.6 million yuan for the financial year ended Dec 31 last year, the estimated net property yield is 5.7 per cent per year, noted the filing.
After taking into account expenses related to the divestment and taxes, OUE Reit is expected to reap net proceeds of about S$318.2 million from the transaction.
The Reit manager believes that this will benefit OUE Reit&rsquo s unitholders as the move is in line with its strategy to optimise portfolio composition, strengthen income resilience, and bring about sustainable returns.
The proceeds will provide the manager with financial flexibility to pare down debt, undertake accretive acquisitions of higher-yielding assets or asset enhancement initiatives, redeem outstanding convertible perpetual preferred units, commence a buyback programme, and distribute them to unitholders, the filing said.
Han Khim Siew, chief executive officer of the manager, said that Lippo Plaza is a non-core asset contributing only 6.6 per cent of OUE Reit&rsquo s total portfolio revenue as of September 2024.
The shorter leasehold tenures as well as the building&rsquo s age have started to impact its valuation and competitiveness, especially with the current supply overhang in the Shanghai market, said Han.
&ldquo The stewardship of Lippo Plaza has now been entrusted to a committed long-term investor attracted by the property&rsquo s very prime location,&rdquo he added.
&ldquo With no plans to further expand our footprint in China, this divestment offers an opportunity to monetise the asset and redeploy the proceeds towards more strategic uses.&rdquo
OUE Reit had acquired the property back in January 2014 for S$335.5 million. Lippo Realty owns a 91.2 per cent share of the strata ownership of the building.
Once the divestment is completed, all of OUE Reit&rsquo s assets would be located in Singapore. These comprise four commercial properties &ndash OUE Bayfront, One Raffles Place, OUE Downtown, and Mandarin Gallery &ndash as well as two hotels, namely Hilton Singapore Orchard and Crowne Plaza Changi Airport.
Price-To-Book ratio:
Frasers Hospitality Trust 0.76 (https://www.gurufocus.com/term/pb-ratio/SGX:ACV)
Keppel Reit 0.62 (https://www.gurufocus.com/term/pb-ratio/SGX:K71U)
OUE Reit 0.47 (https://www.gurufocus.com/term/pb-ratio/SGX:TS0U)
Frasers Hospitality Trust 0.76 (https://www.gurufocus.com/term/pb-ratio/SGX:ACV)
Keppel Reit 0.62 (https://www.gurufocus.com/term/pb-ratio/SGX:K71U)
OUE Reit 0.47 (https://www.gurufocus.com/term/pb-ratio/SGX:TS0U)
Fed could cut interest rates again as US inflation barely moves in November .....
https://www.google.com/amp/s/amp.theguardian.com/business/2024/dec/11/november-inflation-interest-rates
Ripe moment
Delvyss ( Date: 15-Nov-2024 15:13) Posted:
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OUE REIT issues $120 mil of green notes due 2031
The manager of OUE REIT TS0U has issued $120 million of green notes under its $2 billion multicurrency debt issuance programme.
The notes will bear an interest rate of 3.9% per annum and interest on the notes will be payable semi-annually in arrear. The notes are set to mature on Sept 26, 2031.
The issuer may choose to redeem all of the notes, at its option, at any time at 100% of their principal amount plus accrued and unpaid interest if the amount outstanding is less than 10% of the principal amount originally issued.
According to the manager, the notes are set to be consolidated and formed under a single series with the REIT&rsquo s $180 mil of green notes, which were issued on Sept 26.
Oversea-Chinese Banking Corporation was appointed as the sole global coordinator, while DBS Bank and Oversea-Chinese Banking Corporation were the joint lead managers and bookrunners of the offering of the notes. Oversea-Chinese Banking Corporation Limited was also the green finance adviser to OUE REIT.
The net proceeds from the notes are expected to go towards the financing or refinancing, in whole or in part, new or existing eligible green projects that meet one or more of the categories of eligibility as recognised in the green bond principles and green loan principles in accordance with the OUE REIT&rsquo s green financing framework.
As at Nov 21, the manager says the notes have been issued at an issue price of 100.714% of the principal amount with accrued interest from Sept 26 to Nov 21.
'Cautious' better describes the bear
But what to do, he has had 7 rocket launch failures st Seatrium!
Who can blame a bear for being 'pessimistic'?
But what to do, he has had 7 rocket launch failures st Seatrium!
Who can blame a bear for being 'pessimistic'?
Delvyss ( Date: 19-Nov-2024 12:00) Posted:
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Nope. Just the nature of bear to be overly pessimistic (from seeing your posts in Seatrium).
MrBear12 ( Date: 19-Nov-2024 10:52) Posted:
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I thot this was sunset reit. Other much bigger fish playing
Delvyss ( Date: 19-Nov-2024 10:25) Posted:
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This one is ready for sunrise