Singapore Press Holdings eyes REIT listing on SGX Mainboard

Check out how its 3 retail mall assets can benefit.

According to OCBC investment Research, Singapore Press Holdings (SPH) announced that it is exploring a REIT listing on the SGX Mainboard. The properties forming the REIT and the terms at which they would be injected are currently under review. 

Here's more:

We note that SPH now holds three retail mall assets: Paragon currently valued at S$2.43b; a 60% stake in Clementi Mall valued at S$598m (100% basis); and a 70% stake in Seletar Mall, currently under development, valued at S$505m (100% basis).

If this transaction does occur, we see it to be a favorable move which would unlock additional value from its mall assets, by housing them in a more tax-effective REIT structure, and recycle capital back into the group's growing retail mall business.

More importantly, we see this move to have deeper implications from a strategic perspective.

The group has steadily built up a solid skill-set as a retail mall developer and manager over the last few years, and the establishment of a REIT, as a destination for stabilized assets, would further enhance its position as a major player with end-to-end capabilities, from developing greenfield projects to managing stabilized REIT assets. 

We would speak with management further regarding this development and, in the meantime, put our Hold rating and fair value estimate of S$4.05.