Source: Sasseur REIT
Dear Sasseur REIT, I had such great hopes when I first read about you. The first outlet mall REIT to be listed in Singapore, with assets located in China, and a forecast 7.5% annualised FY 2018 yield? Were you to be the China REIT to dispel investor doubts about China REITs? The S-REIT to allow Singaporean investors to regain their faith in China listings? But alas, the reality is a lot more complicated. Your Entrusted Management Agreement is a complicated web of obligations that effectively amounts to a 2 year income support in exchange for a 10 year master lease that caps DPU upside. Your outlet malls are ultimately dependent on Sponsor support to be successful. And at a 7.5% forecast yield and a 3% premium to book, you definitely are not cheap. Is this why you kept the public offering at a miniscule ......
