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)

<ul><li><a href="https://www.smartkarma.com/entities/capitaland-integrated-commercial-trust" target="_blank" data-smartkarma-citation="entities:105" rel="noopener">Capitaland Integrated Commercial Trust (CICT SP)</a> 1H22 DPU +0.8% YoY; Retail turning around led by Downtown malls, but rising energy cost a concern</li><li><a href="https://www.smartkarma.com/entities/keppel-pacific-oak-us-reit" target="_blank" data-smartkarma-citation="entities:25988" rel="noopener">Keppel Pacific Oak US REIT (KORE SP)</a> 2Q22 DPU -9.5% YoY; Declining reversions continue  </li><li><a href="https://www.smartkarma.com/entities/chip-eng-seng-corp-ltd" target="_blank" data-smartkarma-citation="entities:6441" rel="noopener">Chip Eng Seng Corp (CHIP SP)</a> to acquire Park View Mansions development for S$260m</li></ul>

Capitaland Integrated Commercial Trust (CICT SP) 1H22 DPU +0.8% YoY; Retail turning around led by Downtown malls, but rising energy cost a concernKeppel Pacific Oak US REIT (KORE SP) 2Q22 DPU -9.5% YoY; Declining reversions continue  Chip Eng Seng Corp (CHIP SP) to acquire Park View Mansions development for S$260m

ASEAN Builder's Scoop (28Jul22) - CICT Rising Energy Cost a Concern

SGX Market Strategist, Equity & Fixed Income, Singapore Exchange Ltd (SGX)

Geoff Howie

SGX Market Strategist, Equity & Fixed Income

Asia’s leading multi-asset exchange

Singapore Exchange Ltd (SGX)

Singapore Exchange is Asia’s leading and trusted market infrastructure, facilitating the exchange of capital and ideas to create value for people, businesses and economies. As a multi-asset exchange operating equity, fixed income and derivatives markets to the highest regulatory standards, SGX is a vertically integrated business that provides listing, trading, clearing, settlement, depository and data services.

With about 40% of listed companies and over 80% of listed bonds originating outside of Singapore as well as established linkages across the region and in Europe, SGX is Asia’s most international and connected exchange. Offering a full suite of derivatives products across Asian equity indices, commodities and currencies, SGX is the world’s most liquid international market for the benchmark equity indices of China, India, Japan and ASEAN.

As Asia’s pioneering central counterparty, SGX is globally recognised for its risk management and clearing capabilities, and was one of the first globally to adopt the Principles for Financial Market Infrastructure.

Headquartered in AAA-rated Singapore, SGX has over 800 employees including offices in Beijing, Chicago, Hong Kong, London, New York, Mumbai, San Francisco, Shanghai and Tokyo.

Equity Bottom-Up

Keppel Pacific Oak US REIT / Equity Bottom-Up

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 <div class='content-caption'>REIT Watch 12 Jul</div>
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Thirteen Singapore real estate investment trusts (S-Reits) have announced dates of their upcoming earnings releases or business updates, with SPH Reit kicking off the current reporting season for the sector with the release of its third-quarter FY2022 business update (ended May 31, 2022) on Jul 7, 2022.

Of the 13, 9 will be reporting first-half financial results for the year, while 3 will be releasing business updates for their respective periods ending Jun 30, 2022.

The rest of the sector will be unveiling dates of their earnings or business updates over the coming weeks.

SPH Reit in its latest Q3 FY2022 business updates announced a distribution per unit (DPU) of 1.45 Singapore cents, which represents a 5.1 per cent year-on-year increase and brings the annualised distribution yield to 5.81 per cent.

Ascribing to high vaccination rates and the ease of safe distancing measures in both Singapore and Australia, SPH Reit highlighted overall improvement in financial performance, with year-to-date Q3 FY2022 gross revenue recording a 0.9 per cent year-on-year increase to S$211.6 million.

Sales for the same period increased by 12 per cent and 2 per cent in Singapore and Australia respectively.

Across SPH Reit’s portfolio, occupancy rate maintained at 97.6 per cent, while weighted average lease expiry (WALE) stood at 5.4 years by net lettable area and 2.9 years by gross rental income.

In Singapore, its Paragon property saw marked recovery following the relaxation of restrictions in March/April 2022 as tenant sales for the quarter grew 45 per cent year-on-year and exceeded pre-Covid levels.

The Clementi Mall recorded a 6.3 per cent improvement in tenant sales supported by strong food and beverage (F&amp;B) performance.

Its Australia properties also observed recovery in tenant sales post the spike in cases earlier this year.

The iEdge S-Reit Index, a benchmark for Singapore Reits, maintained resiliency for H1 2022 with flat total returns, compared to the FTSE EPRA Nareit Developed Index (a benchmark for global Reits) which declined 18 per cent. 

REIT Watch is a weekly column on The Business Times, <a href="https://www.businesstimes.com.sg/companies-markets/sph-reit-kicks-off-reporting-calendar-with-marked-recovery-in-tenant-sales">read </a>the original version.
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    REIT Watch 12 Jul


Thirteen Singapore real estate investment trusts (S-Reits) have announced dates of their upcoming earnings releases or business updates, with SPH Reit kicking off the current reporting season for the sector with the release of its third-quarter FY2022 business update (ended May 31, 2022) on Jul 7, 2022.

Of the 13, 9 will be reporting first-half financial results for the year, while 3 will be releasing business updates for their respective periods ending Jun 30, 2022.

The rest of the sector will be unveiling dates of their earnings or business updates over the coming weeks.

SPH Reit in its latest Q3 FY2022 business updates announced a distribution per unit (DPU) of 1.45 Singapore cents, which represents a 5.1 per cent year-on-year increase and brings the annualised distribution yield to 5.81 per cent.

Ascribing to high vaccination rates and the ease of safe distancing measures in both Singapore and Australia, SPH Reit highlighted overall improvement in financial performance, with year-to-date Q3 FY2022 gross revenue recording a 0.9 per cent year-on-year increase to S$211.6 million.

Sales for the same period increased by 12 per cent and 2 per cent in Singapore and Australia respectively.

Across SPH Reit’s portfolio, occupancy rate maintained at 97.6 per cent, while weighted average lease expiry (WALE) stood at 5.4 years by net lettable area and 2.9 years by gross rental income.

In Singapore, its Paragon property saw marked recovery following the relaxation of restrictions in March/April 2022 as tenant sales for the quarter grew 45 per cent year-on-year and exceeded pre-Covid levels.

The Clementi Mall recorded a 6.3 per cent improvement in tenant sales supported by strong food and beverage (F&amp;B) performance.

Its Australia properties also observed recovery in tenant sales post the spike in cases earlier this year.

The iEdge S-Reit Index, a benchmark for Singapore Reits, maintained resiliency for H1 2022 with flat total returns, compared to the FTSE EPRA Nareit Developed Index (a benchmark for global Reits) which declined 18 per cent. 

REIT Watch is a weekly column on The Business Times, read the original version.



REIT Watch - SPH Reit kicks off reporting calendar with marked recovery in tenant sales

<figure class="editor-figure mceNonEditable"><img src="https://api2.sgx.com/sites/default/files/2022-06/KORE-CEO.jpg" class="editor-image img-responsive"></figure>
<div class="content-caption">kore - ceo</div>

For finance and real estate veteran David Snyder, the best piece of advice - one that resonated with him through his career - was given by his father when he was a teenager living in Singapore. “A principle my dad had learnt and thought worked best in building a team was to give away all the credit and to take all of the blame,” recalled Snyder, Chief Executive Officer and Chief Investment Officer of the Manager of SGX-listed Keppel Pacific Oak US REIT (KORE). “While I don’t do this perfectly, I have tried to make this my guiding principle and found it invaluable.” “For the success that KORE has achieved, while I may have made some contributions, more often than not, it’s because our finance team, our asset management team, our leasing team and our property management team have all done a great job. If we make mistakes, more often than not, it will be because of poor communication or an oversight on my part,” he noted. “So, this principle doesn’t just work, it’s a true reflection of reality - even if it’s not necessarily what people may expect to see.” Such a leadership style builds respect and loyalty in the team. “It spurs my colleagues to do their best, as they know their work will be recognised, and they won’t be scapegoated or blamed for mistakes of others. Even if they do make mistakes, they will be motivated to improve in the future,” he added. Other core values of Snyder’s management philosophy include honesty, transparency, trust, and teamwork. “Real estate is largely a people business, even though many view it as simply buildings,” he pointed out. “We strive to be transparent and honest with everyone - from our Board, employees and investors, to our asset managers, property managers and leasing teams - basically, all whom we work with,” he added. “It takes time and effort to build trust, and it’s an easy thing to lose, so we work hard to ensure all parties have not just accurate, but all of the relevant, information - both positive and negative - so they can make the best decisions for themselves, or on our behalf.” Listed on the Mainboard of SGX in November 2017, KORE is an office REIT with a portfolio that comprises a balanced mix of 15 freehold office buildings and business campuses across nine key growth markets in the US. As at 31 December 2021, these assets have a combined asset value of US$1.46 billion and an aggregate net lettable&nbsp;area of approximately 5.1 million square feet. Leveraging Strengths Leveraging its focus on the fast-growing segments of technology, advertising, media and information (TAMI), as well as medical and healthcare, KORE invests in income-producing commercial assets in key&nbsp;growth markets characterised by positive economic and office fundamentals that generally outpace the US national average, and the average of the gateway&nbsp;cities.&nbsp; These&nbsp;markets include the Sun Belt and&nbsp;18-Hour Cities, which&nbsp;have and continue to see, an accelerated influx of talent&nbsp;as part of The&nbsp;Great American Move.&nbsp;The Sun Belt has a sunny, warm climate, and extends from the Southeast US all the way across to the Southwest, while 18-hour cities are those with downtowns that flourish outside the 9-to-5 workday. KORE is managed by Keppel Pacific Oak US REIT Management Pte Ltd, which is jointly owned by two sponsors, Keppel Capital and KORE Pacific Advisors (KPA). Looking ahead, the REIT will continue to seek high-quality and value-accretive acquisitions across the US, largely focusing on the 18-Hour and Sun Belt Cities, including Phoenix in Arizona, Raleigh and Durham in North Carolina, Salt Lake City in Utah, San Antonio in Texas, Tampa and Miami in Florida. “These markets will continue to benefit from strong population growth and employment opportunities, good supply-demand dynamics, as well as high occupancies and rental growth in the mid to long term,” Snyder said. In particular, the COVID-19 pandemic has accelerated in-migration to key cities such as Seattle, Denver, Dallas, Austin and Nashville, and put a spotlight on the healthcare and life sciences industry. There are also opportunities in the fast-growing tech sector because of the acceleration of digital transformation by businesses, he noted. KORE has established an early mover’s advantage and strong presence in these selected growth cities, where it has also built a good rapport with the expanding pool of tenants in the technology and healthcare sectors.&nbsp; Additionally, demand for lab spaces has been on the rise, driven by the expansion of biotech companies. KORE’s low-rise business campuses are able to provide or be converted into lab spaces and testing facilities on the spacious ground floors which have been, and continue to be, popular with its tech, healthcare and life sciences tenants.&nbsp; “These strategic attributes and strengths, together with our high-quality assets, put us in a strong position to capitalise on opportunities that arise,” Snyder added. KORE’s portfolio also boasts a diverse tenant base and low tenant concentration risk, with its top 10 tenants contributing only 23.0% % of cash rental income as at 31 March 2022. “The growth in our markets, coupled with our astute management strategies, have enabled KORE to see rent increases that have kept pace with, and in some cases exceeded, our cost increases in the current inflationary period,” he said. Navigating Challenges Nonetheless, industry headwinds persist. “With some of our peers announcing plans to expand into similar markets we invest in, we expect to see more competition,” Snyder admitted. “However, the portfolios of our peers still have significant investments in gateway cities and gateway adjacent markets. Their tenancies are also more heavily concentrated, especially in professional services, with a much lower tech/TAMI and healthcare tenancy.” Other challenges include downsizing by professional service tenants whose employees can work remotely. However, such tenants make up a small percentage of KORE’s tenant base, he added. &nbsp; “Our strong tech focus and significant tech tenancy in our portfolio, along with our locations in key growth markets and other strengths, should help bolster our occupancy rates, even as we expect to see some additional downsizing as leases mature in the future.” In particular, office landlords have been grappling with issues on whether employees will return to the office and at what frequency, as related to the rise of “work from home” and “work from anywhere” concepts. “We’re now seeing big tech companies like Microsoft leading the way, and many others following, by bringing back employees to the office on a flexible basis,” he said.&nbsp; “In fact, the number of workers working exclusively from home is trending down, to just about 11% of the total employed - at around 17.4 million, compared with 50 million working from home in April 2020.” Apart from its day-to-day operational priorities, KORE is equally committed to upholding its Environmental, Social and Governance (ESG) targets. “We have a strategy of balancing improvements on the energy front over time, whilst maintaining strong returns to our unitholders,” Snyder noted.&nbsp; “There are, however, a few challenges, including the fact that some of our older assets were not built with energy efficiency in mind, and would be costly to retrofit, as well as high costs involved in implementing certain energy efficiency and energy usage infrastructure,” he added. “We’re navigating these obstacles by first, focusing on retrofitting items that are less expensive, but create significant energy or water savings. We’ve also been working on the replacement of bigger ticket items with more efficient versions over time.” On growth opportunities, the 51-year-old noted, “One concern I have now is our ability to find accretive acquisitions and grow, as a result of the pandemic and our unwarranted high yield, despite our strong performance.” Fortunately in 2021, the REIT was able to find, and close on, two very strong acquisitions in two of its target markets that were entirely occupied by tech tenants - this is key to its strategy, he added. “Moving forward, as we look for opportunities to acquire, the impact of the pandemic, rising inflation, and limited supply of ready assets will remain key challenges that we will continue to navigate. We have strong teams on the ground who will help us find value-creating investments.” When out of the office, this father of four is spending time with his family or helping others - in particular, building houses for desperately poor families in Mexico. “My kids have learned they can start helping others at any age or any stage in life. My youngest helped build her first house when she was five, and since then, she has helped to build another 15 more.” Keppel Pacific Oak US REIT A distinctive office REIT, KORE listed on SGX Mainboard on 9 November 2017. KORE aims to be the first-choice US office S-REIT focused on the fast-growing technology sector across key growth markets in the US. The REIT invests in a diversified portfolio of income-producing commercial assets and real estate-related assets in key growth markets characterised by positive economic and office fundamentals that generally outpace the US national average, and the average of the gateway cities. These markets include the Super Sun Belts and 18-Hour Cities. Its portfolio comprises a balanced mix of freehold office buildings and business campuses across key growth markets significantly driven by innovation and technology in the US. KORE is managed by Keppel Pacific Oak US REIT Management Pte Ltd, which is jointly owned by two Sponsors, Keppel Capital and KORE Pacific Advisors (KPA). The company website is: <a href="https://www.koreusreit.com/" target="_blank" rel="noopener">www.koreusreit.com</a> Click&nbsp;<a href="https://www.sgx.com/securities/equities/CMOU" target="_blank" rel="noopener">here&nbsp;</a>for the company's StockFacts page. For the year ended 31 December 2021 financial results, click&nbsp;<a href="https://links.sgx.com/1.0.0/corporate-announcements/51PIODSEAYOWK1SJ/698993_Keppel%20Pacific%20Oak%20US%20REIT%202H_FY%202021%20Financial%20Results.pdf" target="_blank" rel="noopener">here</a>. &nbsp;
About&nbsp;kopi-C: the Company brew
Text: Jennifer Tan-Stanisic Photo: Company file kopi-C&nbsp;is a regular column on the SGX Research website that features C-level executives of leading companies listed on Singapore Exchange. These interviews are profiles of senior management aimed at helping investors better understand the individuals who run these corporations. For previous editions of&nbsp;kopi-C: the Company brew,&nbsp;please click&nbsp;<a href="https://www.sgx.com/research-education/market-dialogues" target="_blank" rel="noopener">here</a>. &nbsp; For more information, or if you would like your senior executives to be featured on SGX Market Dialogues, please send suggestions to&nbsp;<a href="https://c/Users/tanje/Desktop/Working%20Files/kopi-C/jennifer.t@sgx.com" target="_blank" rel="noopener">jennifer.t@sgx.com</a>.


kore - ceo

For finance and real estate veteran David Snyder, the best piece of advice - one that resonated with him through his career - was given by his father when he was a teenager living in Singapore.  “A principle my dad had learnt and thought worked best in building a team was to give away all the credit and to take all of the blame,” recalled Snyder, Chief Executive Officer and Chief Investment Officer of the Manager of SGX-listed Keppel Pacific Oak US REIT (KORE). “While I don’t do this perfectly, I have tried to make this my guiding principle and found it invaluable.”  “For the success that KORE has achieved, while I may have made some contributions, more often than not, it’s because our finance team, our asset management team, our leasing team and our property management team have all done a great job. If we make mistakes, more often than not, it will be because of poor communication or an oversight on my part,” he noted.  “So, this principle doesn’t just work, it’s a true reflection of reality - even if it’s not necessarily what people may expect to see.”  Such a leadership style builds respect and loyalty in the team. “It spurs my colleagues to do their best, as they know their work will be recognised, and they won’t be scapegoated or blamed for mistakes of others. Even if they do make mistakes, they will be motivated to improve in the future,” he added.  Other core values of Snyder’s management philosophy include honesty, transparency, trust, and teamwork. “Real estate is largely a people business, even though many view it as simply buildings,” he pointed out.  “We strive to be transparent and honest with everyone - from our Board, employees and investors, to our asset managers, property managers and leasing teams - basically, all whom we work with,” he added.  “It takes time and effort to build trust, and it’s an easy thing to lose, so we work hard to ensure all parties have not just accurate, but all of the relevant, information - both positive and negative - so they can make the best decisions for themselves, or on our behalf.”  Listed on the Mainboard of SGX in November 2017, KORE is an office REIT with a portfolio that comprises a balanced mix of 15 freehold office buildings and business campuses across nine key growth markets in the US. As at 31 December 2021, these assets have a combined asset value of US$1.46 billion and an aggregate net lettable&nbsp;area of approximately 5.1 million square feet.  Leveraging Strengths  Leveraging its focus on the fast-growing segments of technology, advertising, media and information (TAMI), as well as medical and healthcare, KORE invests in income-producing commercial assets in key&nbsp;growth markets characterised by positive economic and office fundamentals that generally outpace the US national average, and the average of the gateway&nbsp;cities.&nbsp;  These&nbsp;markets include the Sun Belt and&nbsp;18-Hour Cities, which&nbsp;have and continue to see, an accelerated influx of talent&nbsp;as part of The&nbsp;Great American Move.&nbsp;The Sun Belt has a sunny, warm climate, and extends from the Southeast US all the way across to the Southwest, while 18-hour cities are those with downtowns that flourish outside the 9-to-5 workday.  KORE is managed by Keppel Pacific Oak US REIT Management Pte Ltd, which is jointly owned by two sponsors, Keppel Capital and KORE Pacific Advisors (KPA).  Looking ahead, the REIT will continue to seek high-quality and value-accretive acquisitions across the US, largely focusing on the 18-Hour and Sun Belt Cities, including Phoenix in Arizona, Raleigh and Durham in North Carolina, Salt Lake City in Utah, San Antonio in Texas, Tampa and Miami in Florida.  “These markets will continue to benefit from strong population growth and employment opportunities, good supply-demand dynamics, as well as high occupancies and rental growth in the mid to long term,” Snyder said.  In particular, the COVID-19 pandemic has accelerated in-migration to key cities such as Seattle, Denver, Dallas, Austin and Nashville, and put a spotlight on the healthcare and life sciences industry. There are also opportunities in the fast-growing tech sector because of the acceleration of digital transformation by businesses, he noted.  KORE has established an early mover’s advantage and strong presence in these selected growth cities, where it has also built a good rapport with the expanding pool of tenants in the technology and healthcare sectors.&nbsp;  Additionally, demand for lab spaces has been on the rise, driven by the expansion of biotech companies. KORE’s low-rise business campuses are able to provide or be converted into lab spaces and testing facilities on the spacious ground floors which have been, and continue to be, popular with its tech, healthcare and life sciences tenants.&nbsp;  “These strategic attributes and strengths, together with our high-quality assets, put us in a strong position to capitalise on opportunities that arise,” Snyder added.  KORE’s portfolio also boasts a diverse tenant base and low tenant concentration risk, with its top 10 tenants contributing only 23.0% % of cash rental income as at 31 March 2022.  “The growth in our markets, coupled with our astute management strategies, have enabled KORE to see rent increases that have kept pace with, and in some cases exceeded, our cost increases in the current inflationary period,” he said.  Navigating Challenges  Nonetheless, industry headwinds persist. “With some of our peers announcing plans to expand into similar markets we invest in, we expect to see more competition,” Snyder admitted.  “However, the portfolios of our peers still have significant investments in gateway cities and gateway adjacent markets. Their tenancies are also more heavily concentrated, especially in professional services, with a much lower tech/TAMI and healthcare tenancy.”  Other challenges include downsizing by professional service tenants whose employees can work remotely. However, such tenants make up a small percentage of KORE’s tenant base, he added. &nbsp;  “Our strong tech focus and significant tech tenancy in our portfolio, along with our locations in key growth markets and other strengths, should help bolster our occupancy rates, even as we expect to see some additional downsizing as leases mature in the future.”  In particular, office landlords have been grappling with issues on whether employees will return to the office and at what frequency, as related to the rise of “work from home” and “work from anywhere” concepts.  “We’re now seeing big tech companies like Microsoft leading the way, and many others following, by bringing back employees to the office on a flexible basis,” he said.&nbsp;  “In fact, the number of workers working exclusively from home is trending down, to just about 11% of the total employed - at around 17.4 million, compared with 50 million working from home in April 2020.”  Apart from its day-to-day operational priorities, KORE is equally committed to upholding its Environmental, Social and Governance (ESG) targets. “We have a strategy of balancing improvements on the energy front over time, whilst maintaining strong returns to our unitholders,” Snyder noted.&nbsp;  “There are, however, a few challenges, including the fact that some of our older assets were not built with energy efficiency in mind, and would be costly to retrofit, as well as high costs involved in implementing certain energy efficiency and energy usage infrastructure,” he added.  “We’re navigating these obstacles by first, focusing on retrofitting items that are less expensive, but create significant energy or water savings. We’ve also been working on the replacement of bigger ticket items with more efficient versions over time.”  On growth opportunities, the 51-year-old noted, “One concern I have now is our ability to find accretive acquisitions and grow, as a result of the pandemic and our unwarranted high yield, despite our strong performance.”  Fortunately in 2021, the REIT was able to find, and close on, two very strong acquisitions in two of its target markets that were entirely occupied by tech tenants - this is key to its strategy, he added.  “Moving forward, as we look for opportunities to acquire, the impact of the pandemic, rising inflation, and limited supply of ready assets will remain key challenges that we will continue to navigate. We have strong teams on the ground who will help us find value-creating investments.”  When out of the office, this father of four is spending time with his family or helping others - in particular, building houses for desperately poor families in Mexico.  “My kids have learned they can start helping others at any age or any stage in life. My youngest helped build her first house when she was five, and since then, she has helped to build another 15 more.”   Keppel Pacific Oak US REIT   A distinctive office REIT, KORE listed on SGX Mainboard on 9 November 2017. KORE aims to be the first-choice US office S-REIT focused on the fast-growing technology sector across key growth markets in the US. The REIT invests in a diversified portfolio of income-producing commercial assets and real estate-related assets in key growth markets characterised by positive economic and office fundamentals that generally outpace the US national average, and the average of the gateway cities. These markets include the Super Sun Belts and 18-Hour Cities. Its portfolio comprises a balanced mix of freehold office buildings and business campuses across key growth markets significantly driven by innovation and technology in the US. KORE is managed by Keppel Pacific Oak US REIT Management Pte Ltd, which is jointly owned by two Sponsors, Keppel Capital and KORE Pacific Advisors (KPA).  The company website is: www.koreusreit.com  Click&nbsp;here&nbsp;for the company's StockFacts page.  For the year ended 31 December 2021 financial results, click&nbsp;here.  &nbsp;
About&nbsp;kopi-C: the Company brew
Text: Jennifer Tan-Stanisic Photo: Company file  kopi-C&nbsp;is a regular column on the SGX Research website that features C-level executives of leading companies listed on Singapore Exchange. These interviews are profiles of senior management aimed at helping investors better understand the individuals who run these corporations.  For previous editions of&nbsp;kopi-C: the Company brew,&nbsp;please click&nbsp;here. &nbsp;  For more information, or if you would like your senior executives to be featured on SGX Market Dialogues, please send suggestions to&nbsp;jennifer.t@sgx.com.

Keppel Pacific Oak US REIT: Driving Sustainability, Unlocking Value

Manulife US REIT (MUST) / Equity Bottom-Up






Data for office markets in Europe and the United States (US) are indicating potential signs of recovery. European office occupier activity remains robust and rents resilient in Q1 2022, and Q4 2021 recorded the strongest quarterly leasing volume since Q4 2018 driven by pent-up demand (Knight Frank, Savills).

Meanwhile in the US, leasing activity rose 5.4 per cent over Q1 2022, marking the fifth consecutive quarter of improved tenant demand, according to JLL.

There are 6 S-Reits with pure Europe and US office properties: Cromwell European Reit : CWBU 0%, IReit Global : 8U7U 0%, and Elite Commercial Reit : MXNU 0% have pure Europe office assets, while Manulife US Reit : BTOU 0%, Prime US Reit : OXMU 0%, and Keppel Pacific Oak US Reit : CMOU 0% have pure US office assets.

Cromwell European Reit reported 94.8 per cent in overall portfolio occupancy and 4.2 per cent positive rent reversion.

Its office portfolio registered positive rent reversion of 1.6 per cent, from several lease renewals and smaller new leases in Italy, France, and Finland. It noted that the preference in Europe trends towards shorter lease durations and flexible leases, while nascent recovery has been tempered by the Ukraine-Russia war which has reduced appetite for office expansions in Finland and Poland.

IReit Global reported an unchanged portfolio occupancy at 95.7 per cent as at Mar 31, 2022. It expects its portfolio to remain resilient, supported by a blue-chip tenant mix and diversified asset base.

IReit will continue to focus on asset management to maintain occupancy and long-term attractiveness through sustainability initiatives.

Elite Commercial Reit reported a 36.2 per cent year-on-year growth in Q1 2022 distributable income, driven by its maiden portfolio acquisition and tax savings as a UK Reit group. It achieved positive outcome from its major lease re-gearing exercise, removing lease break options from 109 assets (set to occur in March 2023).

It received notice to exercise break options for 8 of remaining 9 Department for Work and Pensions (DWP)-occupied assets and will actively manage these. The Reit’s portfolio remains fully occupied as of Mar 31, 2022.

Manulife US Reit reported 3.9 per cent positive rent reversion and portfolio occupancy of 91.7 per cent in Q1 2022, above US Class A average (83 per cent). It noted that employment in most office-using sectors are above pre-Covid-19 levels, led by professional services, information, and financial activities.

Prime US Reit continued to observe stronger leasing activity for Q1 2022, which more than doubled year on year, and positive rent reversion of 3.4 per cent.

Rent reversions over the last 7 quarters have consistently remained positive. It noted that portfolio rents are below asking rents by 6.0 per cent, reflecting the continued potential for rent reversion.

Parking revenue also increased by over 30 per cent as more return to offices in Q1 2022.

Keppel Pacific Oak US Reit reported 2.4 per cent positive rent reversion for Q1 2022 with zero rent deferment requests. It noted new leading demand and expansions from professional services, finance and insurance, TAMI (technology, advertising, media, information), and medical and healthcare. It noted that tenants appear to have long-term confidence in the office market as more companies expand footprints. 

REIT Watch is a weekly column on The Business Times, read the original version



REIT Watch - Signs of an inflection point for S-Reits with Europe, US office assets

<ul><li><a href="https://www.smartkarma.com/entities/keppel-dc-reit" target="_blank" data-smartkarma-citation="entities:85" rel="noopener">Keppel DC REIT (KDCREIT SP)</a> 1Q22 DPU +0.2% YoY; Occupancy reaching record high of 98.7% but growth stalls</li><li><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> 2H22 DPU +2.8% YoY; Reversions improving but in-place restrictions cap upside again in FW  </li><li><a href="https://www.smartkarma.com/entities/keppel-pacific-oak-us-reit" target="_blank" data-smartkarma-citation="entities:25988" rel="noopener">Keppel Pacific Oak US REIT (KORE SP)</a> 1Q22 Business Updates – Declining reversions with steady occupancy</li></ul>

Keppel DC REIT (KDCREIT SP) 1Q22 DPU +0.2% YoY; Occupancy reaching record high of 98.7% but growth stallsMapletree North Asia Commercial Trust (MAGIC SP) 2H22 DPU +2.8% YoY; Reversions improving but in-place restrictions cap upside again in FW  Keppel Pacific Oak US REIT (KORE SP) 1Q22 Business Updates – Declining reversions with steady occupancy

ASEAN Builder's Scoop (20Apr22) - KDCREIT Growth Stalls Despite High Occ

Singapore

Keppel Pacific Oak US REIT operates as a real estate investment trust with properties located in the United States. The Company invests in a diversified portfolio of income-producing commercial and real estate assets in key growth markets of the US.

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Keppel Pacific Oak US REIT (KORE SP)

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REIT Watch - SPH Reit kicks off reporting calendar with marked recovery in tenant sales

Thirteen Singapore real estate investment trusts (S-Reits) have announced dates of their upcoming earnings releases or business...

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Keppel Pacific Oak US REIT: Driving Sustainability, Unlocking Value

For finance and real estate veteran David Snyder, the best piece of advice - one that resonated with him through his career - was given by his...

Singapore Exchange Ltd (SGX)

REIT Watch - Signs of an inflection point for S-Reits with Europe, US office assets

Data for office markets in Europe and the United States (US) are indicating potential signs of recovery. European office occupier activity...

Singapore Exchange Ltd (SGX)

ASEAN Builder's Scoop (20Apr22) - KDCREIT Growth Stalls Despite High Occ

MAGIC challenges remain at FW; KORE declining reversions; Perfect Ten condo cuts prices; IMF sees Phils growing faster in 2022

SCCM Asia Research

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