Research from SooChow CSSD Capital Markets (Asia), SCCM Asia Research

SCCM Asia Research

Research from SooChow CSSD Capital Markets (Asia)

Thematic (Sector/Industry)

<h2>Singapore</h2><h3><a href="https://www.smartkarma.com/entities/mapletree-logistics-trust" target="_blank" data-smartkarma-citation="entities:16035" rel="noopener">Mapletree Logistics Trust (MLT SP)</a> acquires logistics facility in South Korea at 4.2% NPI yield; Accretive to DPU</h3><ul><li>MLT has proposed an acquisition of Yeoju Logistics Centre in South Korea for KRW135bn (S$153.8m). The property spans over 70,400sqm in total GFA on ~56,200sqm of freehold land, with two blocks of 3-storey dry warehouses that were completed in 2019. The property is equipped with high quality building specifications, including strong floor loading of over 20kg newton psm, high floor-to-ceiling height of 10-17m, large contiguous floor plates of up to 14,200sqm and a full sprinkler system. The Property was independently valued at KRW139.6bn as at 2Sep21</li><li>The Property is strategically located in northern Yeoju, a newly established logistics hub situated northeast of the Yongin-Icheon market, which is the traditional logistics cluster in the Seoul Metropolitan Area. It is fully leased to one of South Korea’s largest online fashion platforms and a domestic third-party logistics service provider. The acquisition will raise MLT’s e-commerce revenue exposure in South Korea from 24% to 31%. It comes with a WALE (by NLA) of ~3.1yrs and built-in annual rent escalations</li><li>The acquisition is estimated to generate a NPI yield of 4.2% based on the property purchase price and is expected to be DPU accretive. Assuming the acquisition is 100% debt funded, MLT’s aggregate gearing ratio will be ~40.3%. The acquisition is expected to be completed by 4Q21. Upon completion, MLT’s total portfolio will comprise 167 properties with AUM of S$11.1bn.</li></ul>

SingaporeMapletree Logistics Trust (MLT SP) acquires logistics facility in South Korea at 4.2% NPI yield; Accretive to DPUMLT has proposed an acquisition of Yeoju Logistics Centre in South Korea for KRW135bn (S$153.8m). The property spans over 70,400sqm in total GFA on ~56,200sqm of freehold land, with two blocks of 3-storey dry warehouses that were completed in 2019. The property is equipped with high quality building specifications, including strong floor loading of over 20kg newton psm, high floor-to-ceiling height of 10-17m, large contiguous floor plates of up to 14,200sqm and a full sprinkler system. The Property was independently valued at KRW139.6bn as at 2Sep21The Property is strategically located in northern Yeoju, a newly established logistics hub situated northeast of the Yongin-Icheon market, which is the traditional logistics cluster in the Seoul Metropolitan Area. It is fully leased to one of South Korea’s largest online fashion platforms and a domestic third-party logistics service provider. The acquisition will raise MLT’s e-commerce revenue exposure in South Korea from 24% to 31%. It comes with a WALE (by NLA) of ~3.1yrs and built-in annual rent escalationsThe acquisition is estimated to generate a NPI yield of 4.2% based on the property purchase price and is expected to be DPU accretive. Assuming the acquisition is 100% debt funded, MLT’s aggregate gearing ratio will be ~40.3%. The acquisition is expected to be completed by 4Q21. Upon completion, MLT’s total portfolio will comprise 167 properties with AUM of S$11.1bn.

<h2>Singapore</h2><h3>IOI Properties (IOIPG MK) S$1.508bn sole bid for Marina View white site</h3><p>The white site along Marina View earmarked largely for private residences and hotel use drew just one bid at tender at S$1.508bn or S$1,379psf per plot ratio from a wholly-owned unit of IOIPG, and was just S$101 more than the price at which the group successfully applied for the site to be released from the reserve list of the 1H21 GLS Programme. The 0.78ha (about 84,000sqft) site can generate a maximum GFA of 1.09m sqft. Of this, at least 548,959sqft has to be for residential use and at least 279,861sqft for hotel use. The project can have up to 21,528sqft for optional office space and up to 21,528sqft of space for other commercial uses (including retail and F&amp;B). Most developers may have been put off by the huge total development cost, which a veteran developer estimates at S$2.3bn. Moreover, the development period for the Marina View site is likely to be longer than usual. The URA has stipulated a seven-year project completion period, compared with the usual five years for a typical residential development site.</p>

SingaporeIOI Properties (IOIPG MK) S$1.508bn sole bid for Marina View white siteThe white site along Marina View earmarked largely for private residences and hotel use drew just one bid at tender at S$1.508bn or S$1,379psf per plot ratio from a wholly-owned unit of IOIPG, and was just S$101 more than the price at which the group successfully applied for the site to be released from the reserve list of the 1H21 GLS Programme. The 0.78ha (about 84,000sqft) site can generate a maximum GFA of 1.09m sqft. Of this, at least 548,959sqft has to be for residential use and at least 279,861sqft for hotel use. The project can have up to 21,528sqft for optional office space and up to 21,528sqft of space for other commercial uses (including retail and F&amp;B). Most developers may have been put off by the huge total development cost, which a veteran developer estimates at S$2.3bn. Moreover, the development period for the Marina View site is likely to be longer than usual. The URA has stipulated a seven-year project completion period, compared with the usual five years for a typical residential development site.

<h2>Singapore</h2><h3><a href="https://www.smartkarma.com/entities/ascott-residence-trust" target="_blank" data-smartkarma-citation="entities:6560" rel="noopener">Ascott Residence Trust (ART SP)</a> acquires student accommodation property in Texas for US$70m; 5.1% EBITDA yield</h3><ul><li>ART has entered into a conditional sale and purchase agreement to acquire a student accommodation property located in Texas, USA for US$70m (~S$93.8m). Based on the independent valuation, the property is valued at US$72.0m (~S$96.5m). The property is a freehold, off-campus facility with 1,005 beds and serves Texas Tech University and is 100% leased for the 2021 academic year. Texas Tech University has over 40,000 students</li><li>On a pro forma basis, the acquisition is expected to contribute additional EBITDA of US$3.6m (~S$4.8m), translating to an expected EBITDA yield of 5.1%, and increase distributable income by S$3.3m for FY20, translating to an increase in pro forma distribution per stapled security of ~1.5%</li><li>Completion is subject to and conditional upon, the fulfilment of the conditions precedent in the Sale and Purchase Agreement and is expected to take place on or around 21Sep. ART proposes to finance the total acquisition costs from the private placement to raise gross proceeds of ~S$150.0m and debt financing. Following completion of the acquisition, ART’s aggregate leverage would remain at 35.9%.</li></ul>

SingaporeAscott Residence Trust (ART SP) acquires student accommodation property in Texas for US$70m; 5.1% EBITDA yieldART has entered into a conditional sale and purchase agreement to acquire a student accommodation property located in Texas, USA for US$70m (~S$93.8m). Based on the independent valuation, the property is valued at US$72.0m (~S$96.5m). The property is a freehold, off-campus facility with 1,005 beds and serves Texas Tech University and is 100% leased for the 2021 academic year. Texas Tech University has over 40,000 studentsOn a pro forma basis, the acquisition is expected to contribute additional EBITDA of US$3.6m (~S$4.8m), translating to an expected EBITDA yield of 5.1%, and increase distributable income by S$3.3m for FY20, translating to an increase in pro forma distribution per stapled security of ~1.5%Completion is subject to and conditional upon, the fulfilment of the conditions precedent in the Sale and Purchase Agreement and is expected to take place on or around 21Sep. ART proposes to finance the total acquisition costs from the private placement to raise gross proceeds of ~S$150.0m and debt financing. Following completion of the acquisition, ART’s aggregate leverage would remain at 35.9%.

<h2>Singapore</h2><h3>Jul 21 new private home sales surge 82% MoM; On track for a record year (since 2013)</h3><ul><li>Sales of new private homes surged in Jul21 with developers selling 1,589 units, up 82% MoM from 872 units in Jun21. On a YoY basis, sales were up 47% from 1,080 units in Jul20. Including ECs sold, developers moved 1,744 new homes last month, 81% higher MoM and 53% higher YoY</li><li>Developers launched 1,104 units in Jul21, up 36% MoM and 27% YoY higher. There were no new ECs launched in Jun21. Jul21 take-up rate was robust at 144% (from 107% in Jun21 and 124% in Jul20). Pasir Ris 8 was the top seller last month, moving 418 units, or 86% of its 487 units, with median price of S$1,624psf</li><li>Sales in Jul21 were driven by Pasir Ris 8, followed by Normanton Park, which sold 125 units, Midwood, which sold 91 units and Sengkang Grand Residences, which sold 89 units. Excluding EC, sales volume in Jul21 was highest in OCR followed by RCR and CCR, respectively. The sales volume was 1,012 (64%), 438 (28%) and 139 (9%) units, respectively</li><li>Almost 50% of sales last month were priced below S$1.5m, 29% were between S$1.5-2m, and 21.5% were above S$2m. The average price paid for a unit last month was S$1.7m. In the first seven months of 2021, developers have sold an estimated 8,004 units. Barring new cooling measures, total new private home sales is on course to exceed 11,000 units (excluding ECs) by the end of 2021, locking in the highest annual new sales figure since 2013, which saw 14,948 new sales.</li></ul>

SingaporeJul 21 new private home sales surge 82% MoM; On track for a record year (since 2013)Sales of new private homes surged in Jul21 with developers selling 1,589 units, up 82% MoM from 872 units in Jun21. On a YoY basis, sales were up 47% from 1,080 units in Jul20. Including ECs sold, developers moved 1,744 new homes last month, 81% higher MoM and 53% higher YoYDevelopers launched 1,104 units in Jul21, up 36% MoM and 27% YoY higher. There were no new ECs launched in Jun21. Jul21 take-up rate was robust at 144% (from 107% in Jun21 and 124% in Jul20). Pasir Ris 8 was the top seller last month, moving 418 units, or 86% of its 487 units, with median price of S$1,624psfSales in Jul21 were driven by Pasir Ris 8, followed by Normanton Park, which sold 125 units, Midwood, which sold 91 units and Sengkang Grand Residences, which sold 89 units. Excluding EC, sales volume in Jul21 was highest in OCR followed by RCR and CCR, respectively. The sales volume was 1,012 (64%), 438 (28%) and 139 (9%) units, respectivelyAlmost 50% of sales last month were priced below S$1.5m, 29% were between S$1.5-2m, and 21.5% were above S$2m. The average price paid for a unit last month was S$1.7m. In the first seven months of 2021, developers have sold an estimated 8,004 units. Barring new cooling measures, total new private home sales is on course to exceed 11,000 units (excluding ECs) by the end of 2021, locking in the highest annual new sales figure since 2013, which saw 14,948 new sales.

<h2>Singapore</h2><h3>SREITs results in a glance (see detailed spreadsheet and calendar attached)</h3><table class="table table-striped"><tbody><tr><td style="width: 363.047px; height: 14px;"><p> </p></td><td style="width: 362.953px; height: 14px;"><p>ELITE (GBP)</p></td></tr><tr><td style="width: 363.047px; height: 14px;"><p>Period</p></td><td style="width: 362.953px; height: 14px;"><p>1H21</p></td></tr><tr><td style="width: 363.047px; height: 14px;"><p>Gross Revenue (S$ m)</p></td><td style="width: 362.953px; height: 14px;"><p>15.9 (+37.7% vs forecast)</p></td></tr><tr><td style="width: 363.047px; height: 14px;"><p>NPI (S$ m)</p></td><td style="width: 362.953px; height: 14px;"><p>15.4 (+37% vs forecast)</p></td></tr><tr><td style="width: 363.047px; height: 14px;"><p>DPU (S$ c)</p></td><td style="width: 362.953px; height: 14px;"><p>2.63 (+8.7% vs forecast)</p></td></tr><tr><td style="width: 363.047px; height: 14px;"><p>NAV per Unit (S$)</p></td><td style="width: 362.953px; height: 14px;"><p>0.62</p></td></tr><tr><td style="width: 363.047px; height: 14px;"><p>P/B (x)</p></td><td style="width: 362.953px; height: 14px;"><p>1.08</p></td></tr><tr><td style="width: 363.047px; height: 14px;"><p>Occupancy (%)</p></td><td style="width: 362.953px; height: 14px;"><p>100</p></td></tr><tr><td style="width: 363.047px; height: 7px;"><p>Reversion (%)</p></td><td style="width: 362.953px; height: 7px;"><p>Not Disclosed</p></td></tr><tr><td style="width: 363.047px; height: 14px;"><p>Gearing (%)</p></td><td style="width: 362.953px; height: 14px;"><p>42.1</p></td></tr><tr><td style="width: 363.047px; height: 14px;"><p>Cost of Debt (%)</p></td><td style="width: 362.953px; height: 14px;"><p>1.9</p></td></tr><tr><td style="width: 363.047px; height: 14px;"><p>1 Yr Fwd Yield (%)</p></td><td style="width: 362.953px; height: 14px;"><p>7.41</p></td></tr><tr><td style="width: 363.047px; height: 14px;"><p>Debt Hedged (%)</p></td><td style="width: 362.953px; height: 14px;"><p>63</p></td></tr><tr><td style="width: 363.047px; height: 14px;"><p>Target Price</p></td><td style="width: 362.953px; height: 14px;"><p>N/A</p></td></tr><tr><td style="width: 363.047px; height: 14px;"><p>Rating</p></td><td style="width: 362.953px; height: 14px;"><p>N/A</p></td></tr></tbody></table>

SingaporeSREITs results in a glance (see detailed spreadsheet and calendar attached) ELITE (GBP)Period1H21Gross Revenue (S$ m)15.9 (+37.7% vs forecast)NPI (S$ m)15.4 (+37% vs forecast)DPU (S$ c)2.63 (+8.7% vs forecast)NAV per Unit (S$)0.62P/B (x)1.08Occupancy (%)100Reversion (%)Not DisclosedGearing (%)42.1Cost of Debt (%)1.91 Yr Fwd Yield (%)7.41Debt Hedged (%)63Target PriceN/ARatingN/A

ASEAN Builder's Scoop (02Jul21) - ELITE >7% GBP Yield with Min Collection Risks

Singapore

Oxley Holdings Ltd. develops real estate. The Company develops residential and commercial projects in accessible locations. Oxley also develops light industrial buildings that include swimming pools and other recreational amenities.

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Oxley Holdings (OHL SP)

ASEAN Builder's Scoop (21Oct21)

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ASEAN Builder's Scoop (22Sep21)

IOIPG sole bid for Marina View white site; OHL divests Sydney CBD land parcels; MSGB focuses on affordable homes; Phils demand for large condo...

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ASEAN Builder's Scoop (9Sep21)

ART acquires Texas student housing asset; AAREIT conducting due diligence on AUS asset; FRAG applies for delisting; LPKR increases FY21 mktg sales...

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ASEAN Builder's Scoop (17Aug21)

SG new home sales on track for a record year; OHL SG resi >90% sold; FLI supported by resi recovery; FILRT focuses on BPO tenants; NOBLE shifts...

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ASEAN Builder's Scoop (02Jul21) - ELITE >7% GBP Yield with Min Collection Risks

ELITE >7% GBP yield with min collection risks; EAGLEHT Dalls hotel sold at lower price; GLP sees frothy valuations in most markets; DILD 1H21 mktg...

SCCM Asia Research

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