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

SCCM Asia Research

Research from SooChow CSSD Capital Markets (Asia)

Headquartered in Singapore, SooChow CSSD Capital Markets (Asia) is an investment bank focusing on emerging growth companies across Asia, providing a full suite of investment banking services, including corporate finance, mergers and acquisitions advisory, equity capital markets, institutional equities sales and trading and equities research.

SooChow CSSD Capital Markets (Asia)

Thematic (Sector/Industry)

<h2>Singapore</h2><p>SREITs results in a glance (see detailed spreadsheet and calendar attached)</p><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/237/629/original/image_32975221321635260585172.png?1635260588" class="editor-image img-responsive" data-smartkarma-image-id="237629"></figure><h3><a href="https://www.smartkarma.com/entities/keppel-reit" target="_blank" data-smartkarma-citation="entities:192" rel="noopener">Keppel REIT (KREIT SP)</a> 3Q21 Business Updates – Robust growth from acquisitions, healthy occupancy and collections</h3><ul><li>9M21 revenue and NPI increased by 34.8% and 36.8% YoY to S$162.2m (74.8% of BB est.) and S$129.4m (75.0% of BB est.), respectively. 9M21 DI was up 20.8% YoY to S$159.9m (83.3% of BB est.), mainly due to contributions from Victoria Police Centre, Pinnacle Office Park and Keppel Bay Tower. The increase in DI was partially offset by the impact of the divestment of 275 George Street in Jul21</li></ul>

SingaporeSREITs results in a glance (see detailed spreadsheet and calendar attached)Keppel REIT (KREIT SP) 3Q21 Business Updates – Robust growth from acquisitions, healthy occupancy and collections9M21 revenue and NPI increased by 34.8% and 36.8% YoY to S$162.2m (74.8% of BB est.) and S$129.4m (75.0% of BB est.), respectively. 9M21 DI was up 20.8% YoY to S$159.9m (83.3% of BB est.), mainly due to contributions from Victoria Police Centre, Pinnacle Office Park and Keppel Bay Tower. The increase in DI was partially offset by the impact of the divestment of 275 George Street in Jul21

<h2>Singapore</h2><h3>Private home prices climb 0.9% QoQ in 3Q21; Rising for 6th straight quarter</h3><p>Private home prices rose 0.9% QoQ and 7.3% YoY in 3Q21, marking an increase for the sixth consecutive quarter, according to URA. The price increase in 3Q21 was largely driven by non-landed homes in the Rest of Central Region (RCR), which rose by 2.2% QoQ. In the Core Central Region (CCR), prices fell 0.6%, while prices in the Outside Central Region (OCR) fell by 0.2%. Meanwhile, prices for landed properties rose 2.5% QoQ, compared to a 0.3% decline in the preceding quarter. It is expected that resale homes will continue seeing strong demand. For the full year, CBRE Research expects private home prices to rise by 6–8%, given the current market trajectory.</p>

SingaporePrivate home prices climb 0.9% QoQ in 3Q21; Rising for 6th straight quarterPrivate home prices rose 0.9% QoQ and 7.3% YoY in 3Q21, marking an increase for the sixth consecutive quarter, according to URA. The price increase in 3Q21 was largely driven by non-landed homes in the Rest of Central Region (RCR), which rose by 2.2% QoQ. In the Core Central Region (CCR), prices fell 0.6%, while prices in the Outside Central Region (OCR) fell by 0.2%. Meanwhile, prices for landed properties rose 2.5% QoQ, compared to a 0.3% decline in the preceding quarter. It is expected that resale homes will continue seeing strong demand. For the full year, CBRE Research expects private home prices to rise by 6–8%, given the current market trajectory.

<h2>Singapore</h2><h3><a href="https://www.smartkarma.com/entities/capitaland-ltd" target="_blank" data-smartkarma-citation="entities:55" rel="noopener">Capitaland (CAPL SP)</a> and City Developments (CIT SP) set to launch CanningHill Piers in 4Q21</h3><p>CanningHill Piers, a 696-unit development located between Fort Canning Hill and Singapore River, is set to launch in 4Q21. The development, by joint developers CAPL and CIT, will feature two residential towers. One of them is 48 storeys at 180m tall, which the developers say will be the tallest residential development along the Singapore River. The other tower of 24 storeys overlooks Fort Canning Hill and is 100m in height. Unit types range from one- to five-bedders, Sky Suites, and a penthouse unit, of sizes from 410-8,950sqft.</p><h3>Strata office deals heating up; 1H21 transaction value at record high</h3><p>A 3,079sqft, strata-titled office unit on the 37th floor of Suntec Tower 1 of Suntec City changed hands recently for S$10.52m (S$3,417psf). The price achieved translates to a capital gain of 44% over two years as the seller had purchased the unit in Mar19 for S$7.3m (S$2,347psf). Total strata office transaction volume climbed steadily to 162 units in 1H21, up 20.9% HoH from 134 in 2H20, while total transaction values increased 106.6% over the same period to S$691.5m. This surpassed all previous half-yearly transaction values that hovered below S$600 m since 1H15. Many of the larger quantum sales took place in 2Q21, with 81 strata office deals worth S$454m recorded for 2Q21. This was up from S$237.5m in 1Q21 for the same number of units.</p>

SingaporeCapitaland (CAPL SP) and City Developments (CIT SP) set to launch CanningHill Piers in 4Q21CanningHill Piers, a 696-unit development located between Fort Canning Hill and Singapore River, is set to launch in 4Q21. The development, by joint developers CAPL and CIT, will feature two residential towers. One of them is 48 storeys at 180m tall, which the developers say will be the tallest residential development along the Singapore River. The other tower of 24 storeys overlooks Fort Canning Hill and is 100m in height. Unit types range from one- to five-bedders, Sky Suites, and a penthouse unit, of sizes from 410-8,950sqft.Strata office deals heating up; 1H21 transaction value at record highA 3,079sqft, strata-titled office unit on the 37th floor of Suntec Tower 1 of Suntec City changed hands recently for S$10.52m (S$3,417psf). The price achieved translates to a capital gain of 44% over two years as the seller had purchased the unit in Mar19 for S$7.3m (S$2,347psf). Total strata office transaction volume climbed steadily to 162 units in 1H21, up 20.9% HoH from 134 in 2H20, while total transaction values increased 106.6% over the same period to S$691.5m. This surpassed all previous half-yearly transaction values that hovered below S$600 m since 1H15. Many of the larger quantum sales took place in 2Q21, with 81 strata office deals worth S$454m recorded for 2Q21. This was up from S$237.5m in 1Q21 for the same number of units.

<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: 141.25pt; height: 14.35pt;"><p> </p></td><td style="width: 141.2pt; height: 14.35pt;"><p>PRIME</p></td><td style="width: 141.2pt; height: 14.35pt;"><p>KORE</p></td></tr><tr><td style="width: 141.25pt; height: 14.85pt;"><p>Period</p></td><td style="width: 141.2pt; height: 14.85pt;"><p>1H21</p></td><td style="width: 141.2pt; height: 14.85pt;"><p>1H21</p></td></tr><tr><td style="width: 141.25pt; height: 14.9pt;"><p>Gross Revenue (S$m)</p></td><td style="width: 141.2pt; height: 14.9pt;"><p>72.1 (+1.2% YoY)</p></td><td style="width: 141.2pt; height: 14.9pt;"><p>68.38 (-3% YoY)</p></td></tr><tr><td style="width: 141.25pt; height: 14.35pt;"><p>NPI (S$m)</p></td><td style="width: 141.2pt; height: 14.35pt;"><p>46.3 (-2.3% YoY)</p></td><td style="width: 141.2pt; height: 14.35pt;"><p>40.58 (-3.1% YoY)</p></td></tr><tr><td style="width: 141.25pt; height: 14.35pt;"><p>DPU (S$ c)</p></td><td style="width: 141.2pt; height: 14.35pt;"><p>3.33 (-5.4% YoY)</p></td><td style="width: 141.2pt; height: 14.35pt;"><p>3.16 (+1.9% YoY)</p></td></tr><tr><td style="width: 141.25pt; height: 14.35pt;"><p>NAV per Unit (S$)</p></td><td style="width: 141.2pt; height: 14.35pt;"><p>0.86</p></td><td style="width: 141.2pt; height: 14.35pt;"><p>0.82</p></td></tr><tr><td style="width: 141.25pt; height: 14.35pt;"><p>P/B (x)</p></td><td style="width: 141.2pt; height: 14.35pt;"><p>0.98</p></td><td style="width: 141.2pt; height: 14.35pt;"><p>0.95</p></td></tr><tr><td style="width: 141.25pt; height: 14.35pt;"><p>Occupancy (%)</p></td><td style="width: 141.2pt; height: 14.35pt;"><p>91.7</p></td><td style="width: 141.2pt; height: 14.35pt;"><p>90.5</p></td></tr><tr><td style="width: 141.25pt; height: 7.2pt;"><p>Reversion (%)</p></td><td style="width: 141.2pt; height: 7.2pt;"><p>10.5</p></td><td style="width: 141.2pt; height: 7.2pt;"><p>5.4</p></td></tr><tr><td style="width: 141.25pt; height: 14.35pt;"><p>Gearing (%)</p></td><td style="width: 141.2pt; height: 14.35pt;"><p>34.4</p></td><td style="width: 141.2pt; height: 14.35pt;"><p>37.1</p></td></tr><tr><td style="width: 141.25pt; height: 14.35pt;"><p>Cost of Debt (%)</p></td><td style="width: 141.2pt; height: 14.35pt;"><p>3.2</p></td><td style="width: 141.2pt; height: 14.35pt;"><p>2.82</p></td></tr><tr><td style="width: 141.25pt; height: 14.35pt;"><p>1 Yr Fwd Yield (%)</p></td><td style="width: 141.2pt; height: 14.35pt;"><p>8.45</p></td><td style="width: 141.2pt; height: 14.35pt;"><p>7.77</p></td></tr><tr><td style="width: 141.25pt; height: 14.35pt;"><p>Debt Hedged (%)</p></td><td style="width: 141.2pt; height: 14.35pt;"><p>86%</p></td><td style="width: 141.2pt; height: 14.35pt;"><p>84.7</p></td></tr><tr><td style="width: 141.25pt; height: 14.35pt;"><p>Target Price</p></td><td style="width: 141.2pt; height: 14.35pt;"><p>N/A</p></td><td style="width: 141.2pt; height: 14.35pt;"><p>N/A</p></td></tr><tr><td style="width: 141.25pt; height: 14.85pt;"><p>Rating</p></td><td style="width: 141.2pt; height: 14.85pt;"><p>N/A</p></td><td style="width: 141.2pt; height: 14.85pt;"><p>N/A</p></td></tr></tbody></table>

SingaporeSREITs results in a glance (see detailed spreadsheet and calendar attached) PRIMEKOREPeriod1H211H21Gross Revenue (S$m)72.1 (+1.2% YoY)68.38 (-3% YoY)NPI (S$m)46.3 (-2.3% YoY)40.58 (-3.1% YoY)DPU (S$ c)3.33 (-5.4% YoY)3.16 (+1.9% YoY)NAV per Unit (S$)0.860.82P/B (x)0.980.95Occupancy (%)91.790.5Reversion (%)10.55.4Gearing (%)34.437.1Cost of Debt (%)3.22.821 Yr Fwd Yield (%)8.457.77Debt Hedged (%)86%84.7Target PriceN/AN/ARatingN/AN/A

ASEAN Builder's Scoop (04Aug21) - PRIME High Opex Offset Robust Reversions

<h2>Singapore</h2><h3>Condo and HDB rents continued to rise in May21; Volumes holding up well</h3><p>The rental market for both private apartments and HDB flats in May remained robust despite the tightened Covid-19 measures and border restrictions in place. Rents for condominium units rose by 0.3% MoM and are up 7.3% YoY. They are still down 11.4% from their peak in Jan13, according to SRX. HDB rents saw a slightly higher increase of 0.7% MoM and are up 7.9% YoY. However, they are still 9.2% off their highs in Aug13. With the May increases, condo rents extended their rise to five consecutive months, while HDB rents climbed for 11 straight months. Rental volume for condo apartments increased by 1.7% MoM to an estimated 4,603 units leased in May compared with 4,527 units in Apr. The number of units rented out last month are also 39.3% higher YoY, when Singapore was in its circuit breaker period. HDB rental volume in May saw a slight drop from Apr, down 0.9% MoM to an estimated 1,686 units from 1,702 units in Apr. HDB rental volume last month is 30.4% higher Yoy, though 8.5% lower than the five-year average volume for the month of May.</p><section class="figure"><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/212/219/original/image017.png?1623289645" class="editor-image img-responsive" data-smartkarma-image-id="212219"></figure><section class="figure"><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/212/220/original/image018.png?1623289657" class="editor-image img-responsive" data-smartkarma-image-id="212220"></figure></section></section>

SingaporeCondo and HDB rents continued to rise in May21; Volumes holding up wellThe rental market for both private apartments and HDB flats in May remained robust despite the tightened Covid-19 measures and border restrictions in place. Rents for condominium units rose by 0.3% MoM and are up 7.3% YoY. They are still down 11.4% from their peak in Jan13, according to SRX. HDB rents saw a slightly higher increase of 0.7% MoM and are up 7.9% YoY. However, they are still 9.2% off their highs in Aug13. With the May increases, condo rents extended their rise to five consecutive months, while HDB rents climbed for 11 straight months. Rental volume for condo apartments increased by 1.7% MoM to an estimated 4,603 units leased in May compared with 4,527 units in Apr. The number of units rented out last month are also 39.3% higher YoY, when Singapore was in its circuit breaker period. HDB rental volume in May saw a slight drop from Apr, down 0.9% MoM to an estimated 1,686 units from 1,702 units in Apr. HDB rental volume last month is 30.4% higher Yoy, though 8.5% lower than the five-year average volume for the month of May.

ASEAN Builder's Scoop (10Jun21) - Condo/HDB Rents Continue to Rise in May21

Philippines

Ayala Land is the largest property developer in the Philippines with a track record in developing large-scale, integrated, mixed-use, and sustainable estates. It offers a balanced and complementary mix of residential developments, shopping centers, offices, hotels and resorts, construction, property management and strategic investments.

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Ayala Land Inc (ALI PM)

ASEAN Builder's Scoop (26Oct21)

KREIT healthy collections; KDCREIT boosted by acquisitions; MLT steady as she goes; CLCT record high NPI; ALLT EFR effect dilutes DPU; MEG raises...

SCCM Asia Research

ASEAN Builder's Scoop (4Oct21)

Private home prices rose for 6th straight quarters; HDB resale prices hit new record; MEG to infuse uptown assets to MREIT; DDMPR large POGO...

SCCM Asia Research

ASEAN Builder's Scoop (20Aug21)

CAPL/CIT to launch CanningHill Piers in 4Q21; Strata office deals hitting record in 1H21; ALI plans PHP88bn capex in 2021; S&P lowes Phils growth;...

SCCM Asia Research

ASEAN Builder's Scoop (04Aug21) - PRIME High Opex Offset Robust Reversions

PRIME high opex offset robust reversions; CERT maiden UK logistics acq; OUE 1H21 earnings reversed from a loss; ALI 1H21 NI +34% YoY on low base,...

SCCM Asia Research

ASEAN Builder's Scoop (10Jun21) - Condo/HDB Rents Continue to Rise in May21

Condo/HDB rents continue to rise in May21; LHN on the lookout for more Co-living properties; WHA bets on Phuket reopening; ALI/AREIT property/share...

SCCM Asia Research

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