Of these four properties, Jurong Point and NEX are the most attractive. “NEX is the crown jewel, we believe. As the largest mall in the North-East region, it has a good catchment and would be a strategic fit to any existing retail portfolio,” UBS says.
According to UBS, Swing By @ Thomson Plaza is less attractive being a strata-titled mall with a shorter land tenure. The 99 year lease which started in 1976 has another 53 years left.
“On an average NPI margin of 72%, we estimate cap rates range between 4.4% to 4.85% which appears in line with suburban malls,” UBS estimates.
The $4 billion price is likely to put the portfolio out of reach of most of the S-REITs. Sponsors that could be interested could include CapitaLand Investment, Mapletree, Far East Organization, Lendlease and Frasers Property, UBS suggests. Link REIT could also take a look, it adds.
