ESR-REIT's CEO outlines merger benefits, growth plans

By The Edge Singapore
/ The Edge Singapore |
Join our  Telegram  channel and follow our  Facebook  for the latest update.
SINGAPORE (Jan 23): Adrian Chui, CEO of ESR-REIT’s manager may have started a trend. In 2018, ESR-REIT merged with Viva Industrial Trust in a share and cash offer. VIT unitholders were paid 96 cents per unit of which 90% was with ESR-REIT units, and 10% in cash. In 2019, two mergers were completed, between OUE Commercial REIT and OUE Hospitality Trust, and Ascott Residence Trust and Ascendas Hospitality Trust.
“We saw the onset of this trend three years ago. I guess REITs with sponsors are in a better position to grow bigger. Independent REITs have to find a way to survive,” Chui says during a recent results briefing.
In the initial decade of S-REIT existence, they competed with each other to buy properties. After the global financial crisis, REITs had to compete against each other and with private funds as well. REITs’ gearing (loan-to-value) is capped at 45% but private funds could borrow up to 60% of property value. “In a low interest rate environment [post GFC], the chase for yield started with sovereign wealth funds, family offices and pension funds all looking for higher returns,” Chui points out. The field is a lot more crowded, and these private funds have a lot more flexibility.
This article - ESR-REIT's CEO outlines merger benefits, growth plans is originally from
Read also:

Follow Us
Follow our channels to receive property news updates 24/7 round the clock.
EdgeProp Telegram
EdgeProp Facebook
Subscribe to our newsletter

Our Site (previously known as The Edge Property Singapore) is the best property portal for real estate agents, investors, home-seekers and sellers alike in Singapore. On EdgeProp, you will be able to find the latest and hottest property news, property listings, and access tools for your research and analysis.

Whether you are looking to buy, sell or rent apartments, condominiums, executive condos, HDBs, landed houses, commercial properties or industrial properties, we bring you Singapore’s most comprehensive and up-to-date property news and thousands of listings to facilitate your property decisions. Click into any listing to check out the new AI Redesign tool to envision your property based on your preferred style, be it Scandinavian, Minimalist or many others.

View More