Reviewing a Short Land Lease Industrial Property Purchase – Cache Logistics Trust’s sells Changi Districentre 3 Case Study

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Singapore listed logistics REIT Cache Logistics Trust (dividend yield 9%) 2 days ago announced that they will be selling of Changi Districentre 3.

We take a snapshot of this divestment and cover:

  1. How we can evaluate a REIT manager’s acumen from their past strategic decisions
  2. Is Cache making a profit on this divestment?
  3. Does it make sense to acquire a property that has such a short land lease?
  4. Does the value of the property go down over these 4.5 years?
  5. The performance of this acquisition and divestment
  6. What we should be wary about when evaluating performance of a property asset from 2 different point of view
  7. Why would someone buy such a short lease property

Changi Districentre 3 was bought in 2011 together with another property subsequently after IPO.

The price when Cache purchased was roughly SG$32 mil and it was debt funded. I think we will …

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