Lakshmi Iyer, CFA

Debt Capital Markets

<p>The new <a href="https://www.smartkarma.com/entities/keppel-reit" target="_blank" data-smartkarma-citation="entities:192:1" rel="noopener">Keppel REIT (KREIT SP)</a> perpetual is the second S$ perp issue in the post-Covid world. It is interesting because it is being issued to refinance the S$150mn perp that is callable in November (in other words, the bond will be called). This deal again raises the issue of whether outstanding perps should be priced to the call or not. Given the level at which these bonds have been issued, we think the bond with the next call date in the S$ perp market <a href="https://www.smartkarma.com/entities/ascendas-real-estate-investment-trust" target="_blank" data-smartkarma-citation="entities:39:1" rel="noopener">Ascendas Real Estate Investment Trust (AREIT SP)</a>  4.75% perps) will be called in October.</p><p></p><div class="content-highlight"><p><em>Fundamental credit research focused on Asian high yield, including coverage of areas which are generally overlooked such as Indian finance companies and non-USD denominated credit (SGD).  Sector agnostic. Research process consists of rigorous bottom-up company analysis combined with spotting market dislocations to provide trade ideas.</em></p></div>

The new Keppel REIT (KREIT SP) perpetual is the second S$ perp issue in the post-Covid world. It is interesting because it is being issued to refinance the S$150mn perp that is callable in November (in other words, the bond will be called). This deal again raises the issue of whether outstanding perps should be priced to the call or not. Given the level at which these bonds have been issued, we think the bond with the next call date in the S$ perp market Ascendas Real Estate Investment Trust (AREIT SP)  4.75% perps) will be called in October.Fundamental credit research focused on Asian high yield, including coverage of areas which are generally overlooked such as Indian finance companies and non-USD denominated credit (SGD).  Sector agnostic. Research process consists of rigorous bottom-up company analysis combined with spotting market dislocations to provide trade ideas.

Keppel REIT New Perp - Implications for Ascendas REIT Bondholders