Suntec REIT IPO Launch

Suntec City Development Ltd. raise S$722 million (US$436 million) in Singapore through an initial public offering of its real estate investment trust sometime in November 2004. While the Suntec REIT offer will be the biggest IPO in Singapore this year, overshadowing the S$458 million raised by local telecommmunications operator StarHub Ltd on October 2004. At present, 2 million people visit Suntec City Mall every month, and about 15,000 people work at the Suntec office towers.  Suntec has also managed to get UBS Investment Bank, one of its biggest office tenants, to renew its lease while Oracle has leased a floor space from about 30,000 square feet to 80,000 square feet.  A planned new subway line is being built in the vicinity for completion in 2008, which would give people greater access to Suntec. 

Suntec REIT priced at S$1 each

Suntec REIT (Suntec real estate investment trust) raises S$722 million, units priced at S$1 per share. The public offer was 9.6 times oversubscribed. The REIT will pay a 5.8 percent yield in 2005.

Suntec REIT will start trading on 9 Dec 2004

Suntec Real Estate Investment Trust (REIT) will be open to retail investors from Tuesday, 30 November 2004. The retail offer consists of a minimum of 50 million units priced at between 97 cents and $1. The offer closes on Friday and trading will start on December 9, 2004. The REIT will offer an estimated yield of 5.82% to 6.00% for 2005 on an annualized basis, and between 6.13% and 6.31% for 2006.

Citigroup Inc. (C) unit Citigroup Global Markets Singapore, DBS Group Holdings (D05.SG) unit DBS Bank, and the Singapore branch of German financial giant Deutsche Bank AG (DB) are the lead underwriters for the Suntec REIT sale.

The Suntec REIT, which works like a mutual fund, will allow investors to receive returns based on rents from Suntec City Mall, Singapore´s largest shopping mall, and five office towers. Suntec REIT's portfolio has property assets worth more than S$2.1 billion. Suntec, owned by Hong Kong billionaire Li Ka-Shing and fellow tycoons, has prime property assets located in Singapore´s busy central business district.