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Not All Hospitality Trusts Are Created Equal
By (The) Boring Investor  •  April 5, 2020
In the past 2 months, investors have been selling off Hospitality Trusts (HTs) listed on SGX due to travel restrictions imposed by governments around the world to stem the spread of COVID-19. There are 6 HTs listed on SGX, namely:ARA US HTAscott Residence TrustCDL HTEagle HTFar East HTFrasers HTWhile all hotels will suffer revenue decline due to the travel restrictions, not all HTs will be impacted by the same extent. One important factor affecting the impact on HTs is their operating models. Traditionally, hotels have been owned and operated by the same party, but there are increasingly more investors who wish to invest in hotels but might not have the expertise or time to manage them. Thus, hotels might be owned by one party but operated by another, with revenue-sharing agreements between them. If you buy into HTs, you are buying into the ownership of the hotels. The operating model...
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By (The) Boring Investor
nvestor, Engineer, Photographer, Blogger, Friend and Son.
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