Tag Archives: REAL Estate Investment Trusts

REITs to boost property sector

Posted on 14 Jul 2012 | Comments Off on REITs to boost property sector

The property market is expected to see demand rise over the next 12 months from deep-pocketed institutional buyers such as real estate investment trusts (REITs), which are starting to see more value in the local marketplace, analysts say.

More REIT listings are also likely to spur acquisitions here. The proposed listing of Ascendas Hospitality Trust is set to be Singapore’s largest initial public offering this year, targeting between S$770 million and S$823 million. And experts say more of such REIT listings are to come.

With revenue per available room forecast to increase due to a supply shortage, hospitality REITs with Singapore assets will be attractive to investors.

“They will be successful as long as they can acquire several anchor Singapore properties,” said Mr John Stinson, Managing Director of Capital Markets, Asia-Pacific, Cushman & Wakefield.

“It’s a good time for REITs to be acquiring properties. In the next 12 months, the very successful, the larger REITs will grow in size. As they grow in size, they will rationalise their small properties.”

At its property prospects seminar yesterday, the Real Estate Developers’ Association of Singapore (REDAS) noted that the additional buyer’s stamp duty has brought about new trends in the non-residential property market.

Record transactions have been made for industrial property recently, while the retail property sector also performed strongly, it said.

Source : Today – 13 Jul 2012

Comments Off on REITs to boost property sector

Posted in Funds

Tagged , ,

REITs eye asset enhancement to boost growth

Posted on 4 Jul 2012 | Comments Off on REITs eye asset enhancement to boost growth

With persistently high property prices in Singapore, Singapore’s real estate investment trusts (REITs) are focusing on asset enhancements to boost their growth.

Any acquisitions that they are looking at will have to be yield accretive.

When Causeway Point completes its refurbishment works by this December, its occupancy rate is expected to improve to 100 per cent.

The heartland mall in Woodlands is part of Frasers Centrepoint Trust’s (FCT) portfolio of assets, which also include four other malls in the suburbs.

FCT said it is focusing on asset enhancement to drive growth.

Chew Tuan Chiong, CEO of Frasers Centrepoint Asset Management, said: “Investors should not expect a big quantum when REITs are buying assets. If you are lucky, it will be accretive. Therefore enhancement will be the most powerful engine for growth.

“We had a pretty good first half. The momentum is there. Barring unforeseen circumstances, the economy continues to hold up, despite the volatility. I think most REITs, including ourselves, are expecting a good year ahead.”

With high liquidity in the market, industry players said REITs are a good hedge against inflation. But on the other hand, other industry players said this could make it hard to acquire assets, particularly office properties, as investors look to strata titled assets, leading to higher asking prices of Grade A office properties.

CapitaCommercial Trust (CCT) said higher property prices and lower office rents pose challenges for new acquisitions.

“There are very few good quality assets to buy. If you find something that is a strategic fit in your portfolio, it is also very important to understand the location, tenancy profile and whether there is going to be an upside potential in the rent reversions,” said Lynette Leong, CEO of CapitaCommercial Trust.

CCT is confident of the prospects of its latest office development CapitaGreen located at the site of Market Street Car Park.

When completed, the tower will inject 700,000 square feet of Grade A office space.

Being the only development to be completed in 2014 in the central business district, CCT is confident that CapitaGreen will be able to attract premium tenants.

Source : CNA – 2012 Jul 3

Comments Off on REITs eye asset enhancement to boost growth

Posted in Funds

Tagged ,