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Do you know what is Green Shoe Option?

Green Shoe

Recently, Lippo Malls Indonesia Retail Trust (LMIR Trust) announced that they have obtained up to S$350 Million term loan facilities with a Green Shoe option of up to S$70 million. The proceeds will be used to fund acquisitions and refinance existing debt.

The term “Green Shoe Option” caught my eye. Initially, I thought it was the name of a new mall Lippo is planning to acquire, however upon further reading into the announcement, it doesn’t seem so. Read More

Summary of REITs Financial Results in 1Q2016

Most or all of the REITs in my portfolio have completed announcing their 1Q2016 results. There are some hits and some misses. As shown in the table I summarized below, Distribution Per Unit (“DPU”) increases for 6 out of 11 REITS I am holding while DPU fell for the other 5.

DPU fell for those REITs that focuses on a single industry sector such as industrial, retail or office. REITs like Suntec REIT which has a combination of office and retail survived the economy downturn. Mapletree Commercial Trust did fairly well too as it has a combination of office and retail (Vivocity).

Those with overseas assets did well too. Frasers Commercial Trust has both Singapore and Australian properties. Lippo Malls Indonesia Retail Trust did well as its malls are in Indonesia.

Having said so much, I just want to highlight the importance of diversification of portfolio.

Stock Name

Date Of Release

Of

Financial Results

Dividend Per Unit (DPU)

Increase or Fall

Frasers Commercial Trust Wednesday, 20 January 2016 DPU Increase
CapitaMall Trust Friday, 15 April 2016 DPU Increase
Keppel Reit Thursday, 14 April 2016 DPU Fall
Soilbuild Business Reit Thursday, 14 April 2016 DPU Fall
Suntec REIT Thursday, 21 April 2016  DPU Increase
Mapletree Commercial Trust Tuesday, 26th April 2016   DPU Increase
Parkway Life Reit Tuesday, 26th April 2016   DPU Fall
Far East Hospitality Trust Wednesday, 27th April 2016   DPU Increase
Cambridge Industrial Trust Thursday, 28th April 2016   DPU Fall
Lippo Malls Indonesia Retail Trust Tuesday, 3rd May 2016   DPU Increase
OUE Hospitality Trust Friday, 6th May 2016 DPU Fall

Lippo Malls Indonesia Retail Trust DPU Rises for 1Q2016

LMIR Trust Logo

Lippo Malls Indonesia Retail Trust (“LMIR Trust”) announces its 1Q2016 financial results on 3rd May 2016. Gross revenue increase by 8.5%. Net Property Income (“NPI”) increase by 4.6%. Distribution Per Unit (“DPU”) increases 5.1% to 0.83 cents as compared with 0.79 cents in 1Q2015.

1Q FY16
(S$’000)
1Q FY15
(S$’000)
YoY(%)
Gross Revenue 45,524 41,972 8.5
Net Property Income 40,832 39,026 4.6
Distributable Amount 23,178 21,501 7.8
Distribution Per Unit (“DPU”) (cents) 0.83 0.79 5.1

Debt

LMIR’s total outstanding debt as at 31 March 2016 stood at SGD 695 million, with a gearing ratio of 35.7%. Weighted Average Maturity of debt facilities was 2.18 years. I noticed that  S$150 million fixed rate note are due this year October 2016.

LMIR Weighted Average Debt Maturity 1Q2016

Rental Revenue

These are the top tenants by gross rental revenue. Some familiar names are Giant supermarket, Fitness First and Carrefour. The top 10 tenants contribute to approximately 22.7% to LMIR Trust gross rental revenue.

LMIR Top 10 Tenants 1Q2016

Lease Expiry Profile

The weighted average lease expiry is 4.92 years. The mixture of long and short term leases in LMIR Trust’s portfolio provides growth and stability.

LMIR Lease Expiry Profile 1Q2016

Rental Reversion

The below shows the rental reversion trend for LMIR Trust.

LMIR Rental Reversion 1Q2016

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