Index Rebal/Special Situations, Quiddity Advisors

Janaghan Jeyakumar, CFA

Index Rebal/Special Situations

Quiddity Advisors

Pan-Asia Catalysts/Events

Event-Driven

<ul>
<li>Today after the close, <a href="https://www.smartkarma.com/entities/nippon-building-fund-inc" target="_blank" data-smartkarma-citation="entities:1900:1" rel="noopener">Nippon Building Fund (8951 JP)</a>("NBF") announced a follow-on equity offering to fund part of their recently announced property acquisition. </li>
<li>The primary offer quantity is 47,500 units. In addition, there will also be an over-allotment quantity of 2,500 units. The total size of this offering could be roughly ¥33bn (~US$285mn). </li>
<li>Below is a closer look at the details of this offering and the potential of this offering to trigger strong secondary market performance in the following weeks.</li>
</ul>


Today after the close, Nippon Building Fund (8951 JP)("NBF") announced a follow-on equity offering to fund part of their recently announced property acquisition. 
The primary offer quantity is 47,500 units. In addition, there will also be an over-allotment quantity of 2,500 units. The total size of this offering could be roughly ¥33bn (~US$285mn). 
Below is a closer look at the details of this offering and the potential of this offering to trigger strong secondary market performance in the following weeks.


Nippon Building Fund (8951): Offering Could Trigger Outperformance Vs TSEREIT Index

APAC IPOs & Placements, Aequitas Research

Clarence Chu

APAC IPOs & Placements

IPOs and Placements coverage across Asia Pacific

Aequitas Research

We cover all listing across the Asia Pacific along with follow-up placements. As of Dec 2020, our team had covered 539 IPOs with a hit rate of 73.5% and 685 placements with a hit rate of 66.8%.

We combine fundamental bottom-up views with our proprietary quantitative framework to provide a holistic coverage across new listings and placements. Our coverage includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis as well.

Equity Capital Markets

Japan Prime Realty Investmen / Equity Capital Markets

<ul>
<li>
<a href="https://www.smartkarma.com/entities/japan-prime-realty-investmen" target="_blank" data-smartkarma-citation="entities:495:1" rel="noopener">Japan Prime Realty Investment (8955 JP)</a> aims to raise around US$130m in its Primary Offering, to fund its acquisition of  the Tokyo Tatemono Higashi Shibuya Building and repay borrowings.</li>
<li>The deal is somewhat anticipated, given that the REIT’s asset replacement strategy has been in the works for a couple of months now. </li>
<li>In this note, we will talk about the deal dynamics and run the deal through our ECM framework.</li>
</ul>



Japan Prime Realty Investment (8955 JP) aims to raise around US$130m in its Primary Offering, to fund its acquisition of  the Tokyo Tatemono Higashi Shibuya Building and repay borrowings.
The deal is somewhat anticipated, given that the REIT’s asset replacement strategy has been in the works for a couple of months now. 
In this note, we will talk about the deal dynamics and run the deal through our ECM framework.


Japan Prime Realty Placement - Expected Deal, Has Corrected in the past Month

Japan's largest Office REIT <a href="https://www.smartkarma.com/entities/nippon-building-fund-inc" target="_blank" data-smartkarma-citation="entities:1900:1" rel="noopener">Nippon Building Fund (8951 JP)</a> ("NBF") announced a ¥140bn (~US$1.3bn) <a href="https://www.nbf-m.com/nbf_e/release/files/20201009_Notice%20Concerning%20Issue%20of%20New%20Investment%20Units%20and%20Secondry%20Offering%20on%20Investments%20Units.pdf" target="_blank" rel="noopener">follow-on equity offering</a> on 9th October 2020 and I provided a brief introduction to the background of the REIT and its offerings history in <a href="https://www.smartkarma.com/insights/nippon-building-fund-8951-jp-reit-offering-take-it" target="_blank" data-smartkarma-citation="insights:44090" rel="noopener">Nippon Building Fund (8951 JP) REIT Offering: Take It</a>. As mentioned in that insight, the pricing date was expected to be between 20th and 22nd of October 2020 (pricing is normally on the first day in the pricing period).Today, after market close, NBF <a href="https://www.nbf-m.com/nbf_e/release/files/%E6%9D%A1%E4%BB%B6%E6%B1%BA%E5%AE%9A%E3%83%97%E3%83%AC%E3%82%B9_E.pdf" target="_blank" rel="noopener">announced</a> the Issue Price to be ¥527,240/unit.Below is a brief recap of the Deal details (including confirmation of key dates) and a closer look at the attractiveness of this pricing.

Japan's largest Office REIT Nippon Building Fund (8951 JP) ("NBF") announced a ¥140bn (~US$1.3bn) follow-on equity offering on 9th October 2020 and I provided a brief introduction to the background of the REIT and its offerings history in Nippon Building Fund (8951 JP) REIT Offering: Take It. As mentioned in that insight, the pricing date was expected to be between 20th and 22nd of October 2020 (pricing is normally on the first day in the pricing period).Today, after market close, NBF announced the Issue Price to be ¥527,240/unit.Below is a brief recap of the Deal details (including confirmation of key dates) and a closer look at the attractiveness of this pricing. 

NBF (8951 JP) REIT Offering: Pricing Announced. Wide Discount to Undisturbed.

Japan's largest Office REIT <a href="https://www.smartkarma.com/entities/nippon-building-fund-inc" target="_blank" data-smartkarma-citation="entities:1900:1" rel="noopener">Nippon Building Fund (8951 JP)</a> ("NBF") announced a ¥140bn (~US$1.3bn) <a href="https://www.nbf-m.com/nbf_e/release/files/20201009_Notice%20Concerning%20Issue%20of%20New%20Investment%20Units%20and%20Secondry%20Offering%20on%20Investments%20Units.pdf" target="_blank" rel="noopener">follow-on equity offering</a> on 9th October 2020 to fund their recent acquisition of Shinjuku Mitsui Building and Gran Tokyo South Tower. 
This is the biggest REIT offering in Japan this year so far, is large historically, and is the first offering by NBF, the largest Office REIT by Market Cap since 2014.
NBF plans to offer 171,000 units in the Domestic Primary Offering and 58,000 units in the International Offering (mainly in the U.S., Europe and Asia). However, final allocation can be different depending on demand conditions. The over-allotment quantity will be 11,500 units. 
<section class="figure">
<figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/165/065/original/Price%20Performance.png?1602594897" class="editor-image img-responsive" data-smartkarma-image-id="165065"></figure>
<div class="content-caption">Source: Quiddity, Capital IQ (Data)</div>
</section>
As always, there is more below the fold.

Japan's largest Office REIT Nippon Building Fund (8951 JP) ("NBF") announced a ¥140bn (~US$1.3bn) follow-on equity offering on 9th October 2020 to fund their recent acquisition of Shinjuku Mitsui Building and Gran Tokyo South Tower. 
This is the biggest REIT offering in Japan this year so far, is large historically, and is the first offering by NBF, the largest Office REIT by Market Cap since 2014.
NBF plans to offer 171,000 units in the Domestic Primary Offering and 58,000 units in the International Offering (mainly in the U.S., Europe and Asia). However, final allocation can be different depending on demand conditions. The over-allotment quantity will be 11,500 units. 


Source: Quiddity, Capital IQ (Data)

As always, there is more below the fold. 

Nippon Building Fund (8951 JP) REIT Offering: Take It

Head of Research, IPOs & Placements, Aequitas Research

Sumeet Singh

Head of Research, IPOs & Placements

Smartkarma

Smartkarma unites the fragmented investment industry, connecting institutional investors, independent research providers, and corporates within a single network.

Research Reinvented

KDX Realty Investment / Equity Capital Markets

<a href="https://www.smartkarma.com/entities/16263" target="_blank" data-smartkarma-citation="entities:16263:1">Kenedix Office Investment Co (8972 JP)</a> (KDO) plans to raise around US$140m to part fund its purchase of an office tower in Tokyo. Unlike the other regular market visitors among JREITs, this will be the first issuance for KDO since Nov-2014. While the acquisition NOI yield doesn't seem generous, it does appear that the impact of the acquisition, the sell-off of the properties and the issuance will be mildly DPU positive/neutral. Overall, the deal scores well on our framework given the company's…

Kenedix Office Investment Co (8972 JP) (KDO) plans to raise around US$140m to part fund its purchase of an office tower in Tokyo. Unlike the other regular market visitors among JREITs, this will be the first issuance for KDO since Nov-2014. While the acquisition NOI yield doesn't seem generous, it does appear that the impact of the acquisition, the sell-off of the properties and the issuance will be mildly DPU positive/neutral. Overall, the deal scores well on our framework given the company's…

Kenedix Office REIT Placement - Past Deals Have Done Well

Japan

KDX Realty Investment Corporation operates a real estate investment trust company. The Company invests in office and residential buildings. KDX Realty Investment provides its services throughout Japan.

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KDX Realty Investment (8972 JP)

Nippon Building Fund (8951): Offering Could Trigger Outperformance Vs TSEREIT Index

One of Japan's largest JREITs Nippon building Fund launched a ~US$285mn follow-on equity offering to fund their recent acquisitions. This might...

Janaghan Jeyakumar, CFA

Japan Prime Realty Placement - Expected Deal, Has Corrected in the past Month

Japan Prime Realty Investment (8955 JP) aims to raise around US$130m in its Primary Offering, to fund its acquisition of the Tokyo Tatemono...

Clarence Chu

NBF (8951 JP) REIT Offering: Pricing Announced. Wide Discount to Undisturbed.

The Nippon Building Fund (8951) REIT placement - the largest J-REIT placement this year - has priced. Based on historical patterns and value, it is...

Janaghan Jeyakumar, CFA

Nippon Building Fund (8951 JP) REIT Offering: Take It

NBF's ¥140bn Offering is the largest J-REIT Offering in 2020. Historically, NBF Follow-On Offerings outperform TSEREIT and perform on an absolute...

Janaghan Jeyakumar, CFA

Kenedix Office REIT Placement - Past Deals Have Done Well

Kenedix Office Investment Co (8972 JP) (KDO) plans to raise around US$140m to part fund its purchase of an office tower in Tokyo. Unlike the other...

Sumeet Singh

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