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>Mapletree Logistics Trust (MLT) and Mapletree Industrial Trust (MIT) have no plans on merging</li><li>Condo, HDB rents increases more than 10% in 2021; Rents could continue to move up given cooling measures</li><li><a href="https://www.smartkarma.com/entities/banyan-tree-holdings-ltd" target="_blank" data-smartkarma-citation="entities:18141" rel="noopener">Banyan Tree Holdings (BTH SP)</a> Banyan Tree Group (BTH SP) launches new hospitality concept in Phuket, Thailand</li></ul>

Mapletree Logistics Trust (MLT) and Mapletree Industrial Trust (MIT) have no plans on mergingCondo, HDB rents increases more than 10% in 2021; Rents could continue to move up given cooling measuresBanyan Tree Holdings (BTH SP) Banyan Tree Group (BTH SP) launches new hospitality concept in Phuket, Thailand

ASEAN Builder's Scoop (13Jan22) - No Merger for MLT/MINT

<ul><li><a href="https://www.smartkarma.com/entities/oxley-holdings-ltd" target="_blank" data-smartkarma-citation="entities:1097" rel="noopener">Oxley Holdings (OHL SP)</a> has sold ~95% of its Singapore residential units</li><li><a href="https://www.smartkarma.com/entities/singhaiyi-group-ltd" target="_blank" data-smartkarma-citation="entities:19307" rel="noopener">Singhaiyi (SHG SP)</a> plans to delist from SGX - As at 16Dec21, the total number of Offer Shares owned, controlled or agreed to be acquired by Haiyi Treasure Ltd amounted to an aggregate of 4,035m Offer Shares, representing approximately 95.81% of the total number of issued Offer Shares</li><li>Bukit Timah condo Perfect Ten offers 5% discount during cooling measures</li></ul>

Oxley Holdings (OHL SP) has sold ~95% of its Singapore residential unitsSinghaiyi (SHG SP) plans to delist from SGX - As at 16Dec21, the total number of Offer Shares owned, controlled or agreed to be acquired by Haiyi Treasure Ltd amounted to an aggregate of 4,035m Offer Shares, representing approximately 95.81% of the total number of issued Offer SharesBukit Timah condo Perfect Ten offers 5% discount during cooling measures

ASEAN Builder's Scoop (17Dec21) - OHL Sold ~95% of SG Resi Units

<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/000/240/912/original/image_9006419321636552670499.png?1636552673" class="editor-image img-responsive" data-smartkarma-image-id="240912"></figure><h3><a href="https://www.smartkarma.com/entities/ec-world-reit" target="_blank" data-smartkarma-citation="entities:22842" rel="noopener">EC World Reit (ECWREIT SP)</a> 3Q21 DPU +19.7% YoY; Driven largely by partial DI release and lower retention ratio</h3><ul><li>3Q21 revenue and NPI grew by 10.9% and 9.4% YoY to S$31.6m and S$28.6m, respectively, mainly due to positive straight-line adjustment and strengthening of RMB by 5.2% YoY. 9M21 revenue and NPI grew faster at 16.6% and 15.2% YoY to S$93.5m (78.2% of BB est.) and S$84.2m, respectively, given the absence of one-off rental rebates. On a QoQ basis, revenue and NPI also increased by 1.2% and 2.4% YoY, respectively</li></ul>

Singapore  SREITs results in a glance (see detailed spreadsheet and calendar attached)EC World Reit (ECWREIT SP) 3Q21 DPU +19.7% YoY; Driven largely by partial DI release and lower retention ratio3Q21 revenue and NPI grew by 10.9% and 9.4% YoY to S$31.6m and S$28.6m, respectively, mainly due to positive straight-line adjustment and strengthening of RMB by 5.2% YoY. 9M21 revenue and NPI grew faster at 16.6% and 15.2% YoY to S$93.5m (78.2% of BB est.) and S$84.2m, respectively, given the absence of one-off rental rebates. On a QoQ basis, revenue and NPI also increased by 1.2% and 2.4% YoY, respectively

<h2>Singapore</h2>
<h3>Ang Mo Kio 99-year private housing plot draws 15 bids while EC plot in Tengah draws seven bids</h3>
<ul>
<li>A 99-year leasehold private housing site in Ang Mo Kio Avenue 1, opposite the Bishan-Ang Mo Kio Park, has drawn 15 bids in a state tender. The highest bid of S$381.38m, or nearly S$1,118psf ppr, came from a 60:20:20 joint venture between UOL Group Ltd (UOL SP), Singapore Land Group Limited (SPLG SP) and Kheong Leong Company. This was 6.3% higher than the second highest bid of S$358.89m or S$1,052psf ppr from Titus Residential SG, a tie-up between City Developments Ltd (CIT SP) and MCL Land. Also bidding for the site was a tie-up between Far East Organisation, Sino Group and Sekisui House, which offered S$353.33m or $1,036psf ppr. UOL plans to develop a 24-25 storey project of more than 370 units that will enjoy unblocked views of the Bishan-Ang Mo Kio Park, Lower Peirce Reservoir Park and Shangri-la Park landed housing estate. It is also a timely replenishment for UOL’s land bank</li>
<li>Also closing was the tender for the maiden EC housing site in the Tengah estate. The 99-year leasehold plot in Tengah Garden Walk drew seven bids. The highest offer of S$400.3m, or S$603.17 psf ppr, was from a tie-up between CIT and MCL Land; it was just a tad higher than the nearly S$400.2m or S$602.99psf ppr from the second highest bid, from CSC Land Group. The top bid marks a record land rate for an EC site under the GLS programme. The previous high was S$583psf ppr garnered by the Sumang Walk EC site awarded in Mar18.</li>
</ul>

Singapore
Ang Mo Kio 99-year private housing plot draws 15 bids while EC plot in Tengah draws seven bids

A 99-year leasehold private housing site in Ang Mo Kio Avenue 1, opposite the Bishan-Ang Mo Kio Park, has drawn 15 bids in a state tender. The highest bid of S$381.38m, or nearly S$1,118psf ppr, came from a 60:20:20 joint venture between UOL Group Ltd (UOL SP), Singapore Land Group Limited (SPLG SP) and Kheong Leong Company. This was 6.3% higher than the second highest bid of S$358.89m or S$1,052psf ppr from Titus Residential SG, a tie-up between City Developments Ltd (CIT SP) and MCL Land. Also bidding for the site was a tie-up between Far East Organisation, Sino Group and Sekisui House, which offered S$353.33m or $1,036psf ppr. UOL plans to develop a 24-25 storey project of more than 370 units that will enjoy unblocked views of the Bishan-Ang Mo Kio Park, Lower Peirce Reservoir Park and Shangri-la Park landed housing estate. It is also a timely replenishment for UOL’s land bank
Also closing was the tender for the maiden EC housing site in the Tengah estate. The 99-year leasehold plot in Tengah Garden Walk drew seven bids. The highest offer of S$400.3m, or S$603.17 psf ppr, was from a tie-up between CIT and MCL Land; it was just a tad higher than the nearly S$400.2m or S$602.99psf ppr from the second highest bid, from CSC Land Group. The top bid marks a record land rate for an EC site under the GLS programme. The previous high was S$583psf ppr garnered by the Sumang Walk EC site awarded in Mar18.


ASEAN Builder's Scoop (27May21) - AMK Site Drew High 15bids

<h2>Singapore</h2><h3><a href="https://www.smartkarma.com/entities/esr-reit" target="_blank" data-smartkarma-citation="entities:10934" rel="noopener">ESR-REIT (EREIT SP)</a> expands into AUS, buys SG logistics asset for ~S$180m</h3><ul><li>EREIT is looking to raise about S$150m via a private placement and preferential offering to fund its S$119.2m acquisition of a Tanjong Penjuru logistics facility, as well as asset enhancement initiatives for properties in Tai Seng and Ang Mo Kio. The real estate investment trust has also obtained a S$68.5m unsecured loan to finance the acquisition of a 10% interest in a GIC-majority-owned Australian logistics investment for AUD60.5m (S$62.4m). The investment indirectly holds 33 income-producing properties, two land parcels for future development and two properties, which are currently under development</li><li>GIC holds an 80% stake in the fund, while ESR Queensland Hold Trust, holds the remaining 20%. The private fund is managed by an indirect subsidiary of ESR Cayman, the REIT’s sponsor. The fund's portfolio comprises properties in five Australia states – New South Wales, Victoria, Queensland, South Australia and Western Australia. These have a total land area of about 1.3m sqm, an occupancy rate of 95.9% and a WALE of 4.87 years as at 31Mar. The Australian acquisition will cost an estimated AUD64.9m, comprising the AUD60.5m purchase price and S$2.5m in fees to be incurred in connection with the deal. This whole amount will be financed fully through debt. The Australia acquisition is expected to be completed in May21</li><li>The Singapore acquisition, meanwhile, saw EREIT's trustee entering into a put and call option agreement with seller Montview Investments for 46A Tanjong Penjuru, a five-storey modern ramp-up logistics facility within the Jurong Industrial Estate. The proposed acquisition will cost EREIT about S$124.7m, comprising a S$112m purchase consideration, an estimated S$7.6m upfront land premium payable to JTC for the balance of the first 30-year lease term, S$3.6m in stamp duties, and S$1.5m in other transaction costs</li><li>EREIT is proposing a private placement of between 195.3-201.6m units to institutional investors and other investors at an issue price of between S$37.2-38.4c, to raise at least S$75m. The private placement is subject to an upsize option which brings the amount raised to a maximum of S$100m. EREIT's also plans to undertake a non-renounceable preferential offering of new units to raise no more than S$50m. The preferential offering will not be underwritten. Details of the offering have not been determined as at the date of the announcement but the manager stated the issue price of the offering may differ from the private placement's issue price</li><li>About S$71.8m, or nearly half, of the gross proceeds from the fundraising exercise will partially finance the Tanjong Penjuru acquisition. Some S$43.5m will be used to partially finance the asset enhancement initiatives (AEIs) of two industrial buildings at 16 Tai Seng Street and 7000 Ang Mo Kio Avenue 5, which will cost about S$25.9-53.3m, respectively. EREIT will use around S$31m of gross proceeds to repay existing indebtedness, while S$3.8m will be used to pay for estimated fees and expenses incurred in connection with the equity fundraising.</li></ul><p>Comments: While the overall investments and debt repayment offers a low single-digit 1.0-2.3% accretion to FY20 DPU and -1.5% dilution to FY20 NAV, we are positive on the two investments given their complementary potential upside from AEI/development. The SG asset, 46A Tanjong Penjuru, will enhance EREIT’s exposure in the resilient and highly sought-after quality logistics assets, while the strategic investment on the AU Fund demonstrates EREIT’s ability to access Sponsor’s pipeline of assets. The acquisition at a Fund NAV cap rate of 5.5% (vs. the current market range of 4+%) signals Sponsor’s commitment and support to grow EREIT. Despite having only a minor stake, it allows EREIT to be privy to the portfolio performance, thus offering an edge in acquisition opportunities. On the other hand, the continuous AEI/development efforts with 7% yield to cost would provide EREIT a stable organic growth. We have a BUY rating and TP of S$0.47/unit.</p>

SingaporeESR-REIT (EREIT SP) expands into AUS, buys SG logistics asset for ~S$180mEREIT is looking to raise about S$150m via a private placement and preferential offering to fund its S$119.2m acquisition of a Tanjong Penjuru logistics facility, as well as asset enhancement initiatives for properties in Tai Seng and Ang Mo Kio. The real estate investment trust has also obtained a S$68.5m unsecured loan to finance the acquisition of a 10% interest in a GIC-majority-owned Australian logistics investment for AUD60.5m (S$62.4m). The investment indirectly holds 33 income-producing properties, two land parcels for future development and two properties, which are currently under developmentGIC holds an 80% stake in the fund, while ESR Queensland Hold Trust, holds the remaining 20%. The private fund is managed by an indirect subsidiary of ESR Cayman, the REIT’s sponsor. The fund's portfolio comprises properties in five Australia states – New South Wales, Victoria, Queensland, South Australia and Western Australia. These have a total land area of about 1.3m sqm, an occupancy rate of 95.9% and a WALE of 4.87 years as at 31Mar. The Australian acquisition will cost an estimated AUD64.9m, comprising the AUD60.5m purchase price and S$2.5m in fees to be incurred in connection with the deal. This whole amount will be financed fully through debt. The Australia acquisition is expected to be completed in May21The Singapore acquisition, meanwhile, saw EREIT's trustee entering into a put and call option agreement with seller Montview Investments for 46A Tanjong Penjuru, a five-storey modern ramp-up logistics facility within the Jurong Industrial Estate. The proposed acquisition will cost EREIT about S$124.7m, comprising a S$112m purchase consideration, an estimated S$7.6m upfront land premium payable to JTC for the balance of the first 30-year lease term, S$3.6m in stamp duties, and S$1.5m in other transaction costsEREIT is proposing a private placement of between 195.3-201.6m units to institutional investors and other investors at an issue price of between S$37.2-38.4c, to raise at least S$75m. The private placement is subject to an upsize option which brings the amount raised to a maximum of S$100m. EREIT's also plans to undertake a non-renounceable preferential offering of new units to raise no more than S$50m. The preferential offering will not be underwritten. Details of the offering have not been determined as at the date of the announcement but the manager stated the issue price of the offering may differ from the private placement's issue priceAbout S$71.8m, or nearly half, of the gross proceeds from the fundraising exercise will partially finance the Tanjong Penjuru acquisition. Some S$43.5m will be used to partially finance the asset enhancement initiatives (AEIs) of two industrial buildings at 16 Tai Seng Street and 7000 Ang Mo Kio Avenue 5, which will cost about S$25.9-53.3m, respectively. EREIT will use around S$31m of gross proceeds to repay existing indebtedness, while S$3.8m will be used to pay for estimated fees and expenses incurred in connection with the equity fundraising.Comments: While the overall investments and debt repayment offers a low single-digit 1.0-2.3% accretion to FY20 DPU and -1.5% dilution to FY20 NAV, we are positive on the two investments given their complementary potential upside from AEI/development. The SG asset, 46A Tanjong Penjuru, will enhance EREIT’s exposure in the resilient and highly sought-after quality logistics assets, while the strategic investment on the AU Fund demonstrates EREIT’s ability to access Sponsor’s pipeline of assets. The acquisition at a Fund NAV cap rate of 5.5% (vs. the current market range of 4+%) signals Sponsor’s commitment and support to grow EREIT. Despite having only a minor stake, it allows EREIT to be privy to the portfolio performance, thus offering an edge in acquisition opportunities. On the other hand, the continuous AEI/development efforts with 7% yield to cost would provide EREIT a stable organic growth. We have a BUY rating and TP of S$0.47/unit.

ASEAN Builder's Scoop (7May21) - EREIT Maiden Expansion into AUS

Singapore

SingHaiyi Group Limited is a diversified real estate company focused on property development, real estate investment and property management services. The Group also holds a diversified portfolio of income-generative assets in the commercial and retail sectors, with geographical reach into USA and widening exposure in Asia.

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Singhaiyi (SHG SP)

ASEAN Builder's Scoop (13Jan22) - No Merger for MLT/MINT

No merger for MLT/MINT; Condo, HDB rents may continue rising; BTH launching new concept in Phuket; METRO/Daiwa House deepens collaboration; SIRI...

SCCM Asia Research

ASEAN Builder's Scoop (17Dec21) - OHL Sold ~95% of SG Resi Units

OHL sold ~95% of SG resi units; SHG plans to delist; Perfect Ten offers 5% disc amidst cooling measures; MREIT details asset infusion; CPG new...

SCCM Asia Research

ASEAN Builder's Scoop (10Nov21)

ECWREIT driven by DI release and lower retention; SHG privatization offer; PROP 3Q21 earnings more than doubled; Oct21 condo resale prices rose...

SCCM Asia Research

ASEAN Builder's Scoop (27May21) - AMK Site Drew High 15bids

AMK site drew high 15bids, UOL winner; CAPL rises stake in DLSP; Frasers Hosp expands in China; GLP eyes US$2bn HK IPO; METRO sees decentralized...

SCCM Asia Research

ASEAN Builder's Scoop (7May21) - EREIT Maiden Expansion into AUS

EREIT maiden expansion into AUS; LREIT robust occupancy with limited expiry; SHG acquires Maxwell House; Business Parks +ve outlook; MEG sets 2021...

SCCM Asia Research

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