The Clement Canopy is a 505-unit 99-year leasehold condo located near the National University of Singapore and the Clementi MRT station.
Developed by a 50:50 JV between UOL and Singapore Land, the 140,300 sf site (with a maximum GFA of 491,200 sf) was acquired through a $302.1 million bid at a government land sale exercise in Dec 2015. The acquisition price translates to $615.04 psf and breakeven prices are estimated at $1,000–$1,100 psf.
Meanwhile, Lee says UOL has enjoyed a relatively stable earnings profile in such a tough operating environment. At the end 2016, about 82% of the group’s operating profits came from recurring income sources including property investments, hotel operations, investments and management services. It also achieved 90% occupancy rates for almost all its commercial properties in Singapore.
“We understand that management continues to seek attractive investment properties and have recently entered into a deal to acquire the Hilton Melbourne Wharf for A$230 million ($246.1 million), which will be rebranded as a Pan Pacific Hotel,” says Lee, “In addition, we see current valuations of its share price to be undemanding at 0.66x price-to-book, particularly with its healthy balance sheet with 24% gearing ratio and $301.5 million cash.”
See also: SAC Capital initiates ‘buy’ on Sanli Environmental after $105.3 mil contract win from PUB
Shares of UOL are down 6 cents at $6.61.
