Latest news with #Reit
New Straits Times
3 days ago
- Business
- New Straits Times
Hektar Reit posts 8.9pct higher income in Q1
KUALA LUMPUR: Hektar Real Estate Investment Trust (Hektar Reit) posted RM30.9 million revenue in the first quarter of financial year 2025 (Q1 FY25), up 8.9 per cent from RM28.4 million a year earlier. This was driven by income contributions from the newly-acquired Kolej Yayasan Saad (KYS) education asset and improved performance from Hektar Reit's retail properties. Its net property income rose 4.4 per cent to RM15 million, while net realised income stood at RM4.2 million, lower than the RM5.1 million in the same quarter last year. This was due to the absence of one-off fund placement income recognised in prior period and slightly higher administrative and financing expenses. In line with its environmental, social and governance (ESG) ambitions, Hektar Reit partnered with Samaiden Group Bhd to implement solar project at five of its shopping centres. The initiative is projected to deliver long-term energy cost savings of about RM2.05 million annually or RM41.3 million over 20 years. The Reit's manager Hektar Asset Management Sdn Bhd, said in a statement that a comprehensive asset enhancement initiative is underway at Subang Parade, with the first phase of interior upgrades targeted for completion by the first quarter of 2026. Hektar Asset executive director and chief executive officer Zainal Iskandar said the positive start to the Reit's financial year is encouraging, supported by the strategic diversification of portfolio and prudent cost management. "Our retail assets are now consistently recording positive rental reversions, while our education asset continues to provide consistent income. "These results reflect our continued discipline in maintaining stable returns and strengthening the resilience of our portfolio," he added, The company remains optimistic on the value enhancements to be generated by its retail assets upon completion of asset enhancement initiatives and strategic leasing initiatives. It noted that early gains are already seen in elevated occupancy rate which currently stands at 85.6 per cent, positive rental reversions and higher footfall, boosting yields across Hektar malls. It added that the acquisition of a 15-year master-leased industrial asset in Bayan Lepas Free Industrial Zone is progressing as planned and is poised to further diversify and strengthen the Reit's income profile. Hektar Reit's total assets stood at RM1.44 billion as at March 31, 2025, while the net asset value per unit was RM1.0396. Hektar Reit's portfolio of diversified properties includes Subang Parade in Selangor, Mahkota Parade and Kolej Yayasan Saad in Melaka, Wetex Parade & Classic Hotel and Segamat Central in Johor, as well as Central Square and Kulim Central in Kedah.
Straits Times
3 days ago
- Business
- Straits Times
S'pore retail investors to get expert tips on Reits as the asset class comes back into play
The programme is supported by SGX Group, Reit Association of Singapore and the Securities Association of Singapore. PHOTO: LIANHE ZAOBAO S'pore retail investors to get expert tips on Reits as the asset class comes back into play SINGAPORE – Retail investors can get expert tips on real estate investment trusts as the market for Reits in Singapore heats up with falling interest rates and fresh listings on the horizon. Research analysts, trading representatives and Reit managers will hold 10 sessions under a newly launched educational series on the asset class aimed at enabling retail investors to better understand and assess the risks involved before putting their money into Reits. More than 300 investors, brokers and investment professionals will get to visit Reit properties and understand the assets that they invest in under the six-month programme, which is organised by the Securities Investors Association (Singapore), or Sias. Mr David Gerald, president of Sias, said on May 24: 'Going beyond reading annual reports or attending webinars, investors will now walk through the actual assets, engage the managers, ask questions and understand the fundamentals as part of investor education. Investors will need to understand and assess the risks involved as well when investing in Reits.' The programme is supported by SGX Group, Reit Association of Singapore and the Securities Association of Singapore. Head of equities at SGX Group Ng Yao Loong said SGX sees a healthy Reit IPO pipeline, particularly in emerging sub-sectors like data centres, purpose-built living spaces and logistics assets. Speaking at a Reits symposium on May 24, he noted that the Singapore bourse has emerged as the third-largest Reit listing venue globally by fund-raising, after China and India, in the last five years, adding that SGX is making efforts to ensure that Singapore remains the listing venue of choice for Reits globally. Japan's Nippon Telegraph and Telephone in its earnings release in May said it plans to list its data centre Reit on the SGX in the future. Singapore's Centurion said in a January filing that it is exploring the establishment of a Reit involving some of its workers and student accommodation assets. If the plan materialises, the Reit will be listed on the mainboard of the SGX. Mr Ng also introduced InvestSG, a platform where Reit investors can find sector insights, research, community discussions, market data and model portfolios on Reits, enabling smarter investment portfolio decisions. The platform is slated to be launched in the later part of 2025. Reits are funds that invest in a portfolio of income-generating real estate assets such as shopping malls, offices and hotels. They often take on some debt to buy assets and are subject to an overcall cap on gearing in Singapore. Similar to stocks, Reits are listed on stock exchanges, allowing investors to buy and sell units. With interest rates trending downwards, Reits are expected to benefit in 2025 as borrowing costs decline and investor appetite for income-generating assets grows. RHB Bank analyst Vijay Natarajan in a May 20 report noted that most of the 15 Singapore Reits, or S-Reits, under the bank's coverage reported in-line results for the first quarter, driven by softer interest cost pressures. He said the sharp fall in domestic rates is benefiting the S-Reits, with the majority of them reporting lower overall interest costs. The fall in benchmark rates has also resulted in lower yields for alternative options such as deposit rates, T-bills and Singapore savings bonds, and rising yield spreads for S-Reits – potentially creating room for fund inflows to the sector if the tariff overhang is removed, he added. Mr Ng said Reits stand out as an alternative asset class in times of market volatility, as they exhibit a lower correlation with macro uncertainties as compared to equities and other asset classes. 'As a sector, it is currently trading at a cyclically low valuation of 0.8 time P/B (price-to-book), or around a 20 per cent discount, while offering a forward dividend yield of around 6 per cent,' he said. A P/B ratio of 0.8 time for Reits indicates that the market price of the Reit is 80 per cent of its book value, suggesting that the Reit is trading at a discount to its underlying asset value. He added that Reits not only offer passive rental income, but also exposure to trends such as return-to-office mandates, the rise of artificial intelligence, and evolving consumption patterns. Mr Natarajan of RHB Bank said the direct impact of US tariff policies have been minimal on S-Reits so far, and favours the industrial, office, healthcare, and suburban retail sectors. Hospitality remains his least preferred sector. UOB Kay Hian analyst Jonathan Koh added that several S-Reits, including Frasers Centrepoint Trust, Keppel Reit and CapitaLand Integrated Commercial Trust, reported positive rental reversion, or a positive change in rental rates. 'Singapore is a safe haven due to fiscal discipline and its lowest reciprocal tariff of 10 per cent,' he said. He noted that a favourable rate environment, with a 10-year government bond yield of 2.6 per cent and a three-month compounded Singapore Overnight Rate Average, or Sora, at 2.3 per cent, has helped to boost the attractiveness of Reits, which are now offering yields of 6-7 per cent. Join ST's WhatsApp Channel and get the latest news and must-reads.
Business Times
6 days ago
- Business
- Business Times
Reit privatisation unsurprising amid higher-for-longer interest rates, but investment opportunities remain: SGX equities head
[SINGAPORE] Real estate investment trusts (Reits) being taken private is unsurprising as the sector is facing some challenges, but investment opportunities are still there for those 'willing to look beyond the surface', said Singapore Exchange (SGX) head of equities Ng Yao Loong on Saturday (May 24). Speaking at the opening of the Reits Symposium at the Suntec Convention Centre, Ng said Reits as an asset class have a 'lower correlation with macro uncertainties as compared to equities and other asset classes', which makes the sector a compelling alternative in market volatility. 'But the Singapore Reit (S-Reit) sector is facing some challenges, and not just from the higher-for longer interest rate environment,' he said. The sector currently trading at a 'cyclically low' valuation of 0.8 times price-to-book ratio, or around 20 per cent discount, and a forward dividend yield of around 6 per cent. 'Perhaps not surprisingly, we see Reits being privatised or in the process of being taken private, such as Paragon Reit and Frasers Hospitality Trust,' he said. Despite this, there could be investment opportunities for investors who look deeper into the sector, noted Ng. A NEWSLETTER FOR YOU Tuesday, 12 pm Property Insights Get an exclusive analysis of real estate and property news in Singapore and beyond. Sign Up Sign Up 'We see discerning investors gravitate towards well-managed Reits with strong fundamentals. This should be an encouragement to Reit sponsors and managers to do more to manage their asset yield and optimise their capital structure,' he said. He added that privatisation of Reits is 'part and parcel of corporate restructuring to unlock value'. 'We do see a healthy Reit initial public offering pipeline – particularly in emerging sub-sectors like data centres, purpose-built living spaces and logistics assets,' he said. While he did not name companies, one possible Reit in the works could be the upcoming Nippon Telegraph and Telephone (NTT) DC Reit. Japanese-listed NTT said on May 9 that it would be transferring six of its data centre assets to its planned S-Reit for around US$1.6 billion. Investor education Ng also highlighted the importance of investor education, noting the range of resources SGX offers through its channels such as SGX Academy, its website and social media. 'A well-informed investor is essential to fostering a resilient and sustainable financial ecosystem,' he said. One such resource is the newly launched Reits on the Move initiative by the Securities Investors Association (Singapore), or Sias. It is a 10-part educational series that aims to give investors a hands-on educational experience about the S-Reit sector. The sessions will be guided by research analysts, trading representatives and Reit managers, offering investors practical insights into Reit fundamentals, portfolio strategies and the broader investment landscape, said Sias in a separate press statement. The initiative is supported by SGX, the Reit Association of Singapore and the Securities Association of Singapore. It features 12 participating Reits: Aims Apac Reit; CapitaLand Ascendas Reit; CapitaLand Ascott Trust; CapitaLand Integrated Commercial Trust' ESR Reit; Frasers Centrepoint Trust; Keppel Reit; Lendlease Global Commercial Reit; Mapletree Industrial Trust; OUE Reit' Starhill Global Reit and Suntec Reit. More than 300 investors will be given exclusive access to behind-the-scenes tours of Reit-owned properties in Singapore. David Gerald, founder, president and chief executive of Sias, said: 'Going beyond reading annual reports or attending webinars, investors will now walk through the actual assets, engage the managers, ask questions and understand the fundamentals as part of investor education. 'Investors will need to understand and assess the risks involved as well when investing in Reits.' SGX's Ng noted that Reits have different strategies, countries and fundamentals, and 'are not a singular, homogeneous sector'. 'Gems can be found, especially by those who put in the effort to understand the quality of the underlying assets and management,' he added.
Business Times
6 days ago
- Business
- Business Times
Reit privitisation unsurprising amid higher-for-longer interest rates, but investment opportunities remain: SGX equities head
[SINGAPORE] Real estate investment trusts (Reits) being taken private is unsurprising as the sector is facing some challenges, but investment opportunities are still there for those 'willing to look beyond the surface', said Singapore Exchange (SGX) head of equities Ng Yao Loong on Saturday (May 24). Speaking at the opening of the Reits Symposium at the Suntec Convention Centre, Ng said Reits as an asset class have a 'lower correlation with macro uncertainties as compared to equities and other asset classes', which makes the sector a compelling alternative in market volatility. 'But the Singapore Reit (S-Reit) sector is facing some challenges, and not just from the higher-for longer interest rate environment,' he said. The sector currently trading at a 'cyclically low' valuation of 0.8 times price-to-book ratio, or around 20 per cent discount, and a forward dividend yield of around 6 per cent. 'Perhaps not surprisingly, we see Reits being privatised or in the process of being taken private, such as Paragon Reit and Frasers Hospitality Trust,' he said. Despite this, there could be investment opportunities for investors who look deeper into the sector, noted Ng. A NEWSLETTER FOR YOU Tuesday, 12 pm Property Insights Get an exclusive analysis of real estate and property news in Singapore and beyond. Sign Up Sign Up 'We see discerning investors gravitate towards well-managed Reits with strong fundamentals. This should be an encouragement to Reit sponsors and managers to do more to manage their asset yield and optimise their capital structure,' he said. He added that privatisation of Reits is 'part and parcel of corporate restructuring to unlock value'. 'We do see a healthy Reit initial public offering pipeline – particularly in emerging sub-sectors like data centres, purpose-built living spaces and logistics assets,' he said. While he did not name companies, one possible Reit in the works could be the upcoming Nippon Telegraph and Telephone (NTT) DC Reit. Japanese-listed NTT said on May 9 that it would be transferring six of its data centre assets to its planned S-Reit for around US$1.6 billion. Investor education Ng also highlighted the importance of investor education, noting the range of resources SGX offers through its channels such as SGX Academy, its website and social media. 'A well-informed investor is essential to fostering a resilient and sustainable financial ecosystem,' he said. One such resource is the newly launched Reits on the Move initiative by the Securities Investors Association (Singapore), or Sias. It is a 10-part educational series that aims to give investors a hands-on educational experience about the S-Reit sector. The sessions will be guided by research analysts, trading representatives and Reit managers, offering investors practical insights into Reit fundamentals, portfolio strategies and the broader investment landscape, said Sias in a separate press statement. The initiative is supported by SGX, the Reit Association of Singapore and the Securities Association of Singapore. It features 12 participating Reits: Aims Apac Reit; CapitaLand Ascendas Reit; CapitaLand Ascott Trust; CapitaLand Integrated Commercial Trust' ESR Reit; Frasers Centrepoint Trust; Keppel Reit; Lendlease Global Commercial Reit; Mapletree Industrial Trust; OUE Reit' Starhill Global Reit and Suntec Reit. More than 300 investors will be given exclusive access to behind-the-scenes tours of Reit-owned properties in Singapore. David Gerald, founder, president and chief executive of Sias, said: 'Going beyond reading annual reports or attending webinars, investors will now walk through the actual assets, engage the managers, ask questions and understand the fundamentals as part of investor education. 'Investors will need to understand and assess the risks involved as well when investing in Reits.' SGX's Ng noted that Reits have different strategies, countries and fundamentals, and 'are not a singular, homogeneous sector'. 'Gems can be found, especially by those who put in the effort to understand the quality of the underlying assets and management,' he added.
Business Times
23-05-2025
- Business
- Business Times
Manulife US Reit gets nod to extend asset disposal deadline to Dec 31
[SINGAPORE] The manager of United States office real estate investment trust (Reit) Manulife US Rei t (MUST) on Friday (May 23) announced it has received approval from lenders to extend the deadline for the disposal of assets by six months to Dec 31. The Reit will use US$25 million in cash, in addition to proceeds from the sale of Class A office building Peachtree in Atlanta, US, to partially pare down debts due in 2026, 2027 and 2028. The extension will give MUST more time to meet obligations under the Master Restructuring Agreement. Under this agreement, MUST can dispose up to four Tranche 1 and/or Tranche 2 assets, which are considered non-core assets, to third-party buyers, in order to raise minimum net sales proceeds of US$328.7 million by Jun 30. These assets refer to the Reit's existing properties, which were classified into different tranches. The manager plans to procure the sale of certain Tranche 1 and Tranche 2 assets, which carry high-to-medium occupancy risks, capital expenditure requirements and low-to-medium return potential. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up Tranche 1 assets included the Reit's Centerpointe, Diablo, Figueroa and Penn properties, while Tranche 2 assets included its Capitol, Exchange, Peachtree and Plaza properties. The Reit previously sold two Tranche 2 assets, Capitol and Plaza. In a bourse filing, its manager said it has received approval from lenders to amend the agreement to allow for the disposal of up to three Tranche 2 assets, as well as to divest Peachtree, another Tranche 2 asset. 'Based on the cumulative proceeds from the sales of Capitol, Plaza and Peachtree, MUST will have achieved 82 per cent of the net proceeds target, or US$60 million short of the net proceeds target,' said the Reit manager. The extension also allows MUST time to maximise opportunities to sell Tranche 1 assets and engage with stakeholders and potential buyers in current market conditions. This extension is conditional on the completion of the sale of Peachtree. The sale is expected to be completed by June this year. Assuming that the Peachtree divestment was completed as at Mar 31 this year, and the estimated net sales proceeds and additional US$25 million of cash are used to repay existing loans, MUST's pro forma aggregate leverage is expected to improve to 56.3 per cent from 59.4 per cent, said its manager. The pro forma weighted average interest cost is expected to reduce to 3.9 per cent from 4.4 per cent, and the pro forma weighted average debt maturity will also be extended to 3.1 years from 2.7 years. Units of MUST closed 1.6 per cent or US$0.001 higher at US$0.062 on Friday, before the announcement.
