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RHB Securities 2015-08-31: The REITs Pulsebeat - Weekly Review Report (Part 1 of 3)

Singapore REIT

S-REITs Investment Thesis 


ASCENDAS REAL ESTATE INV TRUST - AREIT (Neutral, TP2.51) 

  • Over SGD100m worth of development & AEI works in pipeline helps buffer downside risks should property prices be recalibrated due to interest rate hikes. 
  • Looks fully-valued at this juncture. 
  • Catalysts: Consistent DPU delivery and future acquisitions from sponsor. 
  • Risk to TP: Slower than expected rates hikes may spur short-term buying ,pushing up share price and vice versa. 


CACHE LOGISTICS TRUST - CACHE (Neutral, TP 1.18) 

  • Tenant concentration risk on CWT/C&P (sponsor), with 51% of leases expiring in 2015-2016. 
  • Catalysts: Further foray into build-to-suit developments and sponsor injections. 
  • Risk to TP: Slower than expected rates hikes may spur short-term buying ,pushing up share price and vice versa. 


CAPITALAND COMMERCIAL TRUST - CCT (Neutral, TP 1.52) 

  • All eyes hinges on CapitaGreen, with 76% pre-commitment. 
  • Minimal dilution with SGD5.25m and SGD175m of CB due in 2015 and 2017 respectively (3.9%) 
  • Catalysts: Further acquisitions incl remaining 60% stake in CapitaGreen. Better than expected office rentals pickup. 
  • Risk to TP: Exacerbated SG office space reduction by financial institutions. 


CDL HOSPITALITY TRUSTS - CDLHT (Neutral, TP1.55) 

  • Maldives foray proves to be a gem, contributing over 10% of revenue as of 3Q14 
  • No signs of recovery in Singapore tourism market. At risk of meeting STB's visitor arrivals target of 16.3-16.8m in 2014. 
  • Catalysts: Further sponsor injections or acquisitions in Maldives. Corporate bookings may turn favorable should USD strengthens. 
  • Risk to TP: More than expected hotel rooms additions in 2014-2016. Sharp decline of tourism in the region.


Ong Kian Lin | Ivan Looi | http://www.rhbgroub.com/ RHB Securities 2015-08-31
NEUTRAL Maintain NEUTRAL 2.51 Same 2.51
NEUTRAL Maintain NEUTRAL 1.18 Same 1.18
NEUTRAL Maintain NEUTRAL 1.52 Same 1.52
NEUTRAL Maintain NEUTRAL 1.55 Same 1.55


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