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/city-developments-ltd" target="_blank" data-smartkarma-citation="entities:57" rel="noopener">City Developments (CIT SP)</a> will not support Sincere Property’s financial obligations; Remaining exposure at S$126m</h3>CIT was made aware of the bankruptcy claim filed by Beijing Yi He Mercury Investment Co Ltd against Sincere Property on 5Jul. CIT reiterated that it has ring-fenced its current financial exposure to its investment in Sincere Property and will not support the continuing financial obligations of Sincere Property. In Feb21, CIT booked a substantial impairment loss of S$1.78bn on its investment in China-based Sincere, which dragged the group into a net loss of S$1.92bn in 2H20. CIT's remaining exposure amounts to only S$126m as at 31Dec20.

SingaporeCity Developments (CIT SP) will not support Sincere Property’s financial obligations; Remaining exposure at S$126mCIT was made aware of the bankruptcy claim filed by Beijing Yi He Mercury Investment Co Ltd against Sincere Property on 5Jul. CIT reiterated that it has ring-fenced its current financial exposure to its investment in Sincere Property and will not support the continuing financial obligations of Sincere Property. In Feb21, CIT booked a substantial impairment loss of S$1.78bn on its investment in China-based Sincere, which dragged the group into a net loss of S$1.92bn in 2H20. CIT's remaining exposure amounts to only S$126m as at 31Dec20.

ASEAN Builder's Scoop (9Jul21) - CIT Remaining Exposure S$126m at Sincere Property

<h2>Singapore</h2><h3><a href="https://www.smartkarma.com/entities/ascendas-real-estate-investment-trust" target="_blank" data-smartkarma-citation="entities:39" rel="noopener">Ascendas Real Estate Investment Trust (AREIT SP)</a> to divest three properties in Australia for ~4.1% NPI yield (BUY; TP S$3.55/unit)</h3>AREIT will divest three logistics properties in Australia for a total of AUD125.1m (S$128.7m). The sale price is ~16.8% higher than the total market valuations of the properties of AUD101.1m as at 31Dec20. The divestments are expected to be completed by 3Q21. AREIT had entered into two separate agreements with unrelated purchasers for the sale of two logistics properties (82 Noosa Street and 62 Stradbroke Street) in Brisbane; and one logistics property (1314 Ferntree Gully Road) in Melbourne. Assuming the divestments were completed on 1Jan20, the annualised proforma impact on AREIT’s NPI would have been a decrease of S$5.1m and DPU would have fallen by S$0.075c for FY20. Net proceeds after divestment costs are expected to be S$124.0m. If the net proceeds were used to repay AREIT’s borrowings as at 31Mar, its gearing will be reduced from 38% to around 37.5%. Post-divestment, AREIT will own 95 properties in Singapore, 34 properties in Australia, 30 properties in the US and 49 properties in the UK/Europe. <table class="table table-striped"><tbody><tr><td style="width: 59.3438px;">Asset</td><td style="width: 48.4375px;">Asset Type</td><td style="width: 45.9375px;">FY20 Gross Revenue</td><td style="width: 59.5781px;">NLA as at 31Dec20</td><td style="width: 59.5625px;">Occupancy as at 31Dec20</td><td style="width: 60.6406px;">Acquisition Date</td><td style="width: 60.6406px;">Acquisition Price</td><td style="width: 101.734px;">Valuation as at 31Dec20(A$1.000:S$0.980)</td><td style="width: 94.9219px;">Sale Price(A$1.00:S$1.029)</td><td style="width: 63.7188px;">Buyer</td></tr><tr><td style="width: 59.3438px;">82 Noosa Street, Brisbane, Australia</td><td style="width: 48.4375px;">Logistics</td><td style="width: 45.9375px;">S$3.3m</td><td style="width: 59.5781px;">38,000sqm</td><td style="width: 59.5625px;">100%</td><td style="width: 60.6406px;">Oct15</td><td style="width: 60.6406px;">S$66.0m</td><td style="width: 101.734px;">A$53.0m (S$51.9m)</td><td rowspan="2" style="width: 94.9219px;">A$101.6m (S$104.5m)or A$1,624psqm</td><td rowspan="2" style="width: 63.7188px;">SIRE (Strategic Industrial Real Estate), an Arrow Capital Partners vehicle in cooperation with Altis Property Partners</td></tr><tr><td style="width: 59.3438px;">62 Stradbroke Street, Brisbane, Australia</td><td style="width: 48.4375px;">Logistics</td><td style="width: 45.9375px;">S$2.6m</td><td style="width: 59.5781px;">24,555sqm</td><td style="width: 59.5625px;">100%</td><td style="width: 60.6406px;">Oct15</td><td style="width: 60.6406px;">S$35.9m</td><td style="width: 101.734px;">A$37.4m (S$36.7m)</td></tr><tr><td style="width: 59.3438px;">1314 Ferntree Gully Road, Melbourne, Australia</td><td style="width: 48.4375px;">Logistics</td><td style="width: 45.9375px;">S$0.5m</td><td style="width: 59.5781px;">16,134sqm</td><td style="width: 59.5625px;">100%</td><td style="width: 60.6406px;">Jun18</td><td style="width: 60.6406px;">S$16.4m</td><td style="width: 101.734px;">A$16.6m (S$16.3m)</td><td style="width: 94.9219px;">A$23.5m (S$24.2m)or A$1,500psqm</td><td style="width: 63.7188px;">China Tube Pty Ltd and Haelram Pty Ltd</td></tr><tr><td colspan="2" style="width: 128.781px;">TOTAL</td><td style="width: 45.9375px;">S$6.4m</td><td style="width: 59.5781px;"> </td><td style="width: 59.5625px;"> </td><td style="width: 60.6406px;"> </td><td style="width: 60.6406px;">S$118.3m</td><td style="width: 101.734px;">A$107.1m (S$104.9m)</td><td style="width: 94.9219px;">A$125.1m (S$128.7m)</td><td style="width: 63.7188px;"> </td></tr></tbody></table>Comments:<ul><li>Taking reference from FY20 AUS Portfolio NPI Margin of 79.0%, the blended NPI yield based on S$128.7m Sale Price would be ~3.9%. Note that comparing the exchange rate adopted for Sale Price vs. Valuation as at 31Dec20, the AUD has strengthen ~5%. Using the 31Dec20 exchange rate, the blended NPI yield would be ~4.1%. Together with its recent divestment of 11 Changi North Way (at S$16.0m), AREIT would have a total divestment proceeds S$144.7m and booking total S$33.8m divestment gain</li><li>Moving forward, we expect AREIT’s DPU to be propelled by both organic and inorganic growth while it reconstitute its portfolio. Notwithstanding the S$1.19bn worth of acquisitions in 1Q21 (estimated to be 1.5% DPU accretive) and the acquisition of remaining 75% of Galaxis (estimated to be 0.40% DPU accretive), the new BTS business park development for Grab as well as UBIX redevelopment (formerly 25 &amp; 27 Ubi Road 4) should start contributing by 2H21 (expected to add S$14.2m to NPI on a full-year basis at 6.4%-7.5% NPI yields)</li><li>We believe AREIT remains in a virtuous cycle of growth. The S$420.0m EFR exercise in 4May21 as well as repayment debt utilizing the divestment proceeds should lower its gearing. With greater financial flexibility, relatively low cost of equity and low interest rate environment, AREIT has further scope for inorganic growth. We have a BUY rating with TP of S$3.55/Unit.</li></ul>

SingaporeAscendas Real Estate Investment Trust (AREIT SP) to divest three properties in Australia for ~4.1% NPI yield (BUY; TP S$3.55/unit)AREIT will divest three logistics properties in Australia for a total of AUD125.1m (S$128.7m). The sale price is ~16.8% higher than the total market valuations of the properties of AUD101.1m as at 31Dec20. The divestments are expected to be completed by 3Q21. AREIT had entered into two separate agreements with unrelated purchasers for the sale of two logistics properties (82 Noosa Street and 62 Stradbroke Street) in Brisbane; and one logistics property (1314 Ferntree Gully Road) in Melbourne. Assuming the divestments were completed on 1Jan20, the annualised proforma impact on AREIT’s NPI would have been a decrease of S$5.1m and DPU would have fallen by S$0.075c for FY20. Net proceeds after divestment costs are expected to be S$124.0m. If the net proceeds were used to repay AREIT’s borrowings as at 31Mar, its gearing will be reduced from 38% to around 37.5%. Post-divestment, AREIT will own 95 properties in Singapore, 34 properties in Australia, 30 properties in the US and 49 properties in the UK/Europe. AssetAsset TypeFY20 Gross RevenueNLA as at 31Dec20Occupancy as at 31Dec20Acquisition DateAcquisition PriceValuation as at 31Dec20(A$1.000:S$0.980)Sale Price(A$1.00:S$1.029)Buyer82 Noosa Street, Brisbane, AustraliaLogisticsS$3.3m38,000sqm100%Oct15S$66.0mA$53.0m (S$51.9m)A$101.6m (S$104.5m)or A$1,624psqmSIRE (Strategic Industrial Real Estate), an Arrow Capital Partners vehicle in cooperation with Altis Property Partners62 Stradbroke Street, Brisbane, AustraliaLogisticsS$2.6m24,555sqm100%Oct15S$35.9mA$37.4m (S$36.7m)1314 Ferntree Gully Road, Melbourne, AustraliaLogisticsS$0.5m16,134sqm100%Jun18S$16.4mA$16.6m (S$16.3m)A$23.5m (S$24.2m)or A$1,500psqmChina Tube Pty Ltd and Haelram Pty LtdTOTALS$6.4m   S$118.3mA$107.1m (S$104.9m)A$125.1m (S$128.7m) Comments:Taking reference from FY20 AUS Portfolio NPI Margin of 79.0%, the blended NPI yield based on S$128.7m Sale Price would be ~3.9%. Note that comparing the exchange rate adopted for Sale Price vs. Valuation as at 31Dec20, the AUD has strengthen ~5%. Using the 31Dec20 exchange rate, the blended NPI yield would be ~4.1%. Together with its recent divestment of 11 Changi North Way (at S$16.0m), AREIT would have a total divestment proceeds S$144.7m and booking total S$33.8m divestment gainMoving forward, we expect AREIT’s DPU to be propelled by both organic and inorganic growth while it reconstitute its portfolio. Notwithstanding the S$1.19bn worth of acquisitions in 1Q21 (estimated to be 1.5% DPU accretive) and the acquisition of remaining 75% of Galaxis (estimated to be 0.40% DPU accretive), the new BTS business park development for Grab as well as UBIX redevelopment (formerly 25 &amp; 27 Ubi Road 4) should start contributing by 2H21 (expected to add S$14.2m to NPI on a full-year basis at 6.4%-7.5% NPI yields)We believe AREIT remains in a virtuous cycle of growth. The S$420.0m EFR exercise in 4May21 as well as repayment debt utilizing the divestment proceeds should lower its gearing. With greater financial flexibility, relatively low cost of equity and low interest rate environment, AREIT has further scope for inorganic growth. We have a BUY rating with TP of S$3.55/Unit.

ASEAN Builder's Scoop (4Jun21) - AREIT Divesting 3 AUS Props for ~4.1% Yield

<h2>Singapore</h2><h3><a href="https://www.smartkarma.com/entities/mapletree-north-asia-commercial-trust" target="_blank" data-smartkarma-citation="entities:5127" rel="noopener">Mapletree North Asia Commercial Trust (MAGIC SP)</a> to acquire HP Tokyo HQ building for S$474.7m; DPU accretive by +2.4%</h3><ul><li>MAGIC has entered into an agreement to buy 98.47% effective interest in a freehold single-tenanted office building in Tokyo at an agreed property value of JPY38.8bn (S$474.7m). The property is now used as Hewlett-Packard Japan headquarters from Hulic Co, an unrelated third party vendor. The balance effective interest of 1.53% in the property will be held by Mapletree Investments Japan Kabushiki Kaisha, an indirect wholly-owned subsidiary of Mapletree Investments, MAGIC’s sponsor</li><li>The property is 100% leased to Hewlett-Packard Japan and has a lease expiry of 8.8 years. The AUM of the enlarged portfolio will stand at S$8.4bn, or an increase of 6% from existing portfolio of S$7.9bn. Contribution from Japan will increase from 16.6% to 21.3% by AUM, or an increase from 22.4% to 26.7% by NPI</li><li>MAGIC intends to finance the purchase and relevant costs through a combination of debt financing and issuance of perpetual securities. The estimated NPI yield is 3.7%. On a FY21 pro-forma basis, the acquisition is expected to be DPU accretive by +2.4%</li><li>Aggregate leverage post acquisition is expected to be 41.9%, up marginally from 41.5%. Completion is subject to the conditions being fulfilled and is expected to take place by 30Jun.</li></ul><section class="figure"><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/210/110/original/image003.png?1622425518" class="editor-image img-responsive" data-smartkarma-image-id="210110"></figure></section>

SingaporeMapletree North Asia Commercial Trust (MAGIC SP) to acquire HP Tokyo HQ building for S$474.7m; DPU accretive by +2.4%MAGIC has entered into an agreement to buy 98.47% effective interest in a freehold single-tenanted office building in Tokyo at an agreed property value of JPY38.8bn (S$474.7m). The property is now used as Hewlett-Packard Japan headquarters from Hulic Co, an unrelated third party vendor. The balance effective interest of 1.53% in the property will be held by Mapletree Investments Japan Kabushiki Kaisha, an indirect wholly-owned subsidiary of Mapletree Investments, MAGIC’s sponsorThe property is 100% leased to Hewlett-Packard Japan and has a lease expiry of 8.8 years. The AUM of the enlarged portfolio will stand at S$8.4bn, or an increase of 6% from existing portfolio of S$7.9bn. Contribution from Japan will increase from 16.6% to 21.3% by AUM, or an increase from 22.4% to 26.7% by NPIMAGIC intends to finance the purchase and relevant costs through a combination of debt financing and issuance of perpetual securities. The estimated NPI yield is 3.7%. On a FY21 pro-forma basis, the acquisition is expected to be DPU accretive by +2.4%Aggregate leverage post acquisition is expected to be 41.9%, up marginally from 41.5%. Completion is subject to the conditions being fulfilled and is expected to take place by 30Jun.

ASEAN Builder's Scoop (31May21) - MAGIC Acquires HP Tokyo HQ Building

<h2>Singapore</h2>
<h3>
<a href="https://www.smartkarma.com/entities/eagle-hospitality-trust" target="_blank" data-smartkarma-citation="entities:28059" rel="noopener">Eagle Hospitality Trust (EAGLEHT SP)</a> five properties put on auction received qualified bids</h3>
Five out of 15 properties put up for auction have received qualified bids in the second bid round for EAGLEHT Chapter 11 assets held on 20May. The DBS trustee said its Chapter 11 entities received qualified bids for Sheraton Denver Tech Center, Four Points by Sheraton San Jose Airport, Embassy Suites by Hilton Anaheim North, Doubletree by Hilton Salt Lake City Airport, and Hilton Atlanta Northeast. The auction resulted in a US$24.8m net increase in the aggregate consideration for EAGLEHT's auctioned properties. A stalking-horse bidder, Madison Phoenix LLC, an affiliate of Monarch Alternative Capital, emerged successful for its bid of nine non-auctioned properties with an aggregate purchase price of US$326.5m. This is in accordance with the terms of the stalking-horse agreement between entities of EAGLEHT and the bidder, which effectively sets an opening price or price floor to protect the company selling the assets at low bids. Properties remaining in EAGLEHT's portfolio upon approval of the sale would comprise Queen Mary Long Beach, Delta Woodbridge, Hilton Houston Galleria Area and Crowne Plaza Dallas Near Galleria-Addison.

Singapore

Eagle Hospitality Trust (EAGLEHT SP) five properties put on auction received qualified bids
Five out of 15 properties put up for auction have received qualified bids in the second bid round for EAGLEHT Chapter 11 assets held on 20May. The DBS trustee said its Chapter 11 entities received qualified bids for Sheraton Denver Tech Center, Four Points by Sheraton San Jose Airport, Embassy Suites by Hilton Anaheim North, Doubletree by Hilton Salt Lake City Airport, and Hilton Atlanta Northeast. The auction resulted in a US$24.8m net increase in the aggregate consideration for EAGLEHT's auctioned properties. A stalking-horse bidder, Madison Phoenix LLC, an affiliate of Monarch Alternative Capital, emerged successful for its bid of nine non-auctioned properties with an aggregate purchase price of US$326.5m. This is in accordance with the terms of the stalking-horse agreement between entities of EAGLEHT and the bidder, which effectively sets an opening price or price floor to protect the company selling the assets at low bids. Properties remaining in EAGLEHT's portfolio upon approval of the sale would comprise Queen Mary Long Beach, Delta Woodbridge, Hilton Houston Galleria Area and Crowne Plaza Dallas Near Galleria-Addison.

ASEAN Builder's Scoop (25May21) - EAGLEHT Properties Received Qualified Bids

Head of Research, IPOs & Placements, Aequitas Research

Sumeet Singh

Head of Research, 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

Mapletree Industrial Trust / Equity Capital Markets

<a href="https://www.smartkarma.com/entities/mapletree-industrial-trust" target="_blank" data-smartkarma-citation="entities:40:1" rel="noopener">Mapletree Industrial Trust (MINT SP)</a> plans to raise around US$385m (S$513m) to partly fund the acquisition of 29 data centres located in the United States.We have covered three of the past placements for MINT:<ul>
<li dir="ltr" aria-level="1"><a href="https://www.smartkarma.com/insights/mint-placement-known-asset-more-data-centres-less-sme-exposure-heading-in-the-right-direction" target="_blank" rel="noopener">MINT Placement - Known Asset, More Data Centres, Less SME Exposure -&gt; Heading in the Right Direction</a></li>
<li dir="ltr" aria-level="1"><a href="https://www.smartkarma.com/insights/mint-placement-accretive-acquisition-but-look-out-for-the-rising-leverage" target="_blank" rel="noopener">MINT Placement - Accretive Acquisition but Look Out for the Rising Leverage</a></li>
<li dir="ltr" aria-level="1"><a href="https://www.smartkarma.com/insights/mint-placement-well-flagged-placement-but-only-marginally-accretive-past-deals-have-done-well" target="_blank" rel="noopener">MINT Placement - Well Flagged Placement but Only Marginally Accretive, Past Deals Have Done Well</a></li>
</ul>In this insight, we'll run the deal through our ECM framework and talk about deal dynamics.

Mapletree Industrial Trust (MINT SP) plans to raise around US$385m (S$513m) to partly fund the acquisition of 29 data centres located in the United States.We have covered three of the past placements for MINT:
MINT Placement - Known Asset, More Data Centres, Less SME Exposure -&gt; Heading in the Right Direction
MINT Placement - Accretive Acquisition but Look Out for the Rising Leverage
MINT Placement - Well Flagged Placement but Only Marginally Accretive, Past Deals Have Done Well
In this insight, we'll run the deal through our ECM framework and talk about deal dynamics.

Mapletree Industrial (MINT SP) Placement - Large but Accretive Deal, Becoming More like Keppel DC

Singapore

City Developments Limited is a property developer and owner. The Company, through its subsidiaries, are principally engaged in the investment of properties and shares, property management, project management and the provision of consultancy services, hospitality-related information technology, and procurement services. City Developments has a global presence.

Price Gauge
52-week Range	0.00 - 0.00
Market Cap (USDm)	0.00
P/E	0.00
Dividend (Yield)	0.00

City Developments (CIT SP)

ASEAN Builder's Scoop (9Jul21) - CIT Remaining Exposure S$126m at Sincere Property

CIT remaining exposure S$126m at Sincere Property; HDB resale prices ~1.7% away from peak; DD/JFC first and largest industrial REIT in Phils; LPKR...

SCCM Asia Research

ASEAN Builder's Scoop (4Jun21) - AREIT Divesting 3 AUS Props for ~4.1% Yield

AREIT divesting 3 AUS props for ~4.1% yield; CIT plans UK-backed SREIT IPO; Hilton Orchard undergoing rebranding; SG bungalow prices reaching new...

SCCM Asia Research

ASEAN Builder's Scoop (31May21) - MAGIC Acquires HP Tokyo HQ Building

MAGIC acquires HP Tokyo HQ building; CIT is not pressured to sell assets; Keppel Land expands in HCM; Indo 1Q21 resi sales +14% YoY; EAST dips back...

SCCM Asia Research

ASEAN Builder's Scoop (25May21) - EAGLEHT Properties Received Qualified Bids

EAGLEHT properties received qualified bids; CIT warns of cooling measures; UEMS 1Q21 net loss narrows; ECW achieved 70% FY21 sales target; Phuket...

SCCM Asia Research

Mapletree Industrial (MINT SP) Placement - Large but Accretive Deal, Becoming More like Keppel DC

Mapletree Industrial Trust (MINT SP) plans to raise around US$385m (S$513m) to partly fund the acquisition of 29 data centres located in the United...

Sumeet Singh

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)