Rare portfolio sale seen spurring M&A for Singapore REITs

SINGAPORE: An unorthodox sale of assets by a Singapore real investment intestment trust (REIT) is set to inspire more M&A among the city-state’s property trusts, three quarters of which are languishing below book value, bankers and fund managers say.

Saizen Real Estate Investment Trust agreed last month to sell its Japan portfolio to an affiliate of US private equity firm Lone Star Funds for US$370mil. In doing so, it gained a slight premium to adjusted net asset value per unit despite the property trust having traded at a discount to net asset value over the last two years.