On 12 June 2016, Croesus Retail Trust (SGX: S6NU) (CRT) shocked the market when the trust announced it intended to acquire its manager for S$50 million. This will be the first of its kind in Singapore where a property trust is an internally-managed investment vehicle. As the proposed deal required unitholders’ approval, an extraordinary general meeting was carried out on Thursday, 30 June 2016.

When the questions were opened to unitholders, one was quick to challenge the board of directors: “Frankly, I do not support this deal because you’re doing all these only for a 1% dividend yield accretion. How does this deal help increase retail yield and reduce the financing cost for the trust? Those are two big elephants in the room rather than this internalisation deal.”

According to Chairman David Lim, the internalization will result in significant cost savings for the trust. Croesus Retail Trust has grown ...