[SINGAPORE] UI Boustead Reit is expected to commence trading on the SGX mainboard on Mar 12. The Reit has a mandate to invest in logistics, general industrial, hi\u2011specs industrial and business space properties across the Asia-Pacific region.<\/p>\n
The initial public offering (IPO) portfolio comprises 23 properties, of which 21 are leasehold assets located in Singapore and two are freehold properties in Japan. The total agreed property valuation stands at S$1.9 billion, with a total gross floor area of 5.9 million square feet and a net lettable area of 5.3 million sq ft. The portfolio is well-diversified across the various property types, with no single property type contributing more than 30 per cent of the agreed property value.<\/p>\n
The Reit\u2019s portfolio currently has an occupancy rate of 89.4 per cent. Key properties include Razer\u2019s South-east Asia headquarters, Edward Boustead Centre, GSK Asia House and Rolls\u2011Royce Solutions Asia. The top 10 tenants contribute 54 per cent of net property income, with nine out of the top 10 tenants being Fortune 500, Fortune 500 Europe and publicly-listed multinational corporations. The average weighted average lease expiry for the top 10 tenants is 8.4 years.<\/p>\n
According to the IPO prospectus, there is potential for positive rent reversions across the portfolio. All single\u2011tenanted properties have contractual built\u2011in rental escalations, providing certainty in organic growth potential. The average rental escalation from single\u2011tenanted properties is projected at 2.2 per cent for projection year 2027. In addition, about 420,000 sq ft of space is currently under negotiation, which could contribute an additional 8 per cent of incremental occupancy uplift if concluded.<\/p>\n
The Singapore properties have achieved average rent reversions of between 7.5 and 11.5 per cent for leases renewed in FY24 and FY25, and a positive rent reversion of 11.3 per cent for renewals committed between Apr 1, 2025, and Sep 30, 2025.<\/p>\n
UIB, as the sponsor of the Reit, was formed through Unified Industrial\u2019s acquisition of Boustead\u2019s fund and property management business. The sponsor currently manages total assets under management across Asia of US$4 billion. Both UIB and Boustead Projects have granted a right of first refusal to UI Boustead Reit over their respective pipeline of relevant real estate assets. Additionally, the sponsor has indicated that the Reit will serve as the sole capital recycling vehicle for its Pan\u2011Asian stabilised industrial and logistics assets.<\/p>\n
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At an issue price of S$0.88 per unit, the Reit is expected to raise about S$1 billion (including the over-allotment option exercised in full) and have an initial market capitalisation of approximately S$1.2 billion. Based on this issue price, the Reit has a price to net asset value of 1.0 times. The forecast distribution yield is 7.4 per cent for forecast year 2026 and 7.8 per cent for projection year 2027. The aggregated leverage ratio is estimated to be 37.9 per cent at IPO.<\/p>\n
Cornerstone investors have committed to acquire 31.4 per cent of the IPO units, including Amova Asset Management, JPMorgan Asset Management (Singapore), Amundi Singapore, Jumbo Group and Boustead CEO Wong Fong Fui.<\/p>\n
Following the listing of UI Boustead Reit, the number of industrial S\u2011Reits in Singapore will rise to eight, making industrial S\u2011Reits the second\u2011largest property sub\u2011segment by the number of Reits, after diversified S\u2011Reits.<\/p>\n