Pavilion – thestar
Pavilion REIT posts second-quarter proit
Pavilion Real Estate Investment Trust (REIT) posted a net profit of RM47.7mil, or 1.59 sen earnings per share on revenue of RM82.8mil for the second quarter ended June 30.
For the first six months, Pavilion REIT posted a net profit of RM95.5mil. Its revenue stood at RM168.1mil. There were no comparative figures reported.
Pavilion REIT also declared an income distribution comprising 3.28 sen per unit (taxable) and 0.08 sen per unit (non taxable) totalling 3.36 sen per unit.
Pavilion – BT
Pavilion REIT's earnings forecast raised
Maybank Kim Eng Research has raised the financial year 2012-2014 earnings forecast of Pavilion Real Estate Investment Trust (Pavilion REIT)by eight to 8.4 per cent.
It also factored in a higher rental growth and turnover rent as well as higher occupancy rate.
Maybank Kim Eng in a research note today said Pavilion REIT's first half net profit of RM95.6 million was above the research house and consensus expectations at 55 to 56 per cent.
"This was due mainly to higher-than-expected retail turnover rent and rental hikes," it said.
Going forward, it said piling works of the Pavilion KL Mall extension will commence in the third quarter, whilst construction of the sub-urban mall in Subang Jaya is ahead of schedule.
"As for the Fahrenheit 88 mall, the management is monitoring the leases due for renewal in the third quarter, rental reversions and tenancy profile.
"When acquired, we expect these properties to raise Pavilion REIT's asset size by more than 41 per cent from RM3.6 billion currently," it added.
Maybank Kim Eng has maintained a "hold" call on Pavilion REIT but revised upward the target price to RM1.40 from RM1.26 previously. — BERNAMA
Pavilion – thestar
PavREIT profit beats estimates
By RHB Research House
Market Perform (Downgraded)
Target Price: RM1.22
PAVILION REIT’S (PavREIT) first-quarter net profit of RM47.8mil makes up 27.1% of our full-year net profit forecast, slightly above our and consensus full-year estimates. No dividend was declared for the quarter, as PavREIT makes its distribution semi-annually.
The higher-than-expected revenue contribution in the first quarter of financial year 2012 was mainly attributed to the increased rental revenue and sales turnover due to the Lunar New Year and Formula 1 GP events; and the increased shopper traffic from the opening of the linked bridge between KL City Centre and Pavilion, where the manager estimates traffic footfall of 15,000-20,000 people per day.
About 17% of the net lettable area (NLA) due to expire this year was renewed in the first quarter, with rental reversion of about 10%.
Occupancy rates had dropped to around 94% for Pavilion Mall due to its refurbishment works but remain stable for Pavilion Tower.
Note that the manager expects Pavilion Tower to be fully occupied by the third quarter, as a tenant has taken up about 10,000 sq ft NLA (about 6% of Pavilion Tower’s total NLA) and is expected to move in once renovation is completed in June or July.
The conversion of 68,000 sq ft of space previously occupied by TANGS has kicked off in the first quarter. The refurbishment of the space (to be known as Fashion Avenue) is expected to be completed in September, with a soft launch targeted in August. The manager is confident that the space will be fully occupied upon it is launched in September.
Our dividend discounted model-based fair value is kept at RM1.22. However, we downgrade our call on PavREIT to “market perform” (from “outperform”), as the share price has strengthened in recent weeks, hence there is now minimal potential upside to our indicative fair value of the stock.
We continue to like PavREIT due to its large asset size, quality assets and significant long-term potential as rental cycle is still in its early stages.
Pavilion – BT Singapore
Pavilion Reit shines on debut with 16% gain
SHARES in Pavilion Real Estate Investment Trust (PReit) posted a smart 16 per cent gain on debut yesterday, closing at RM1.02 each amid brisk trading volumes.
The trust, partly owned by the Qatar Investment Authority, had priced the institutional portion of its RM710 million (S$291 million) initial public offering at 90 sen each. The retail portion of the offer was priced at 88 sen.
The premium was in stark contrast to the broader market which fell 0.2 per cent amid continuing worries over the eurozone’s financial health and could illustrate investor caution amid a preference for safe and reasonably yielding stocks. At RM1 a share, according to HwangDBS Vickers Research in a pre-IPO report, the trust offers a distribution yield of 5.8 per cent.
The trust is the sole premium retail Reit in Malaysia with its most valuable asset being Pavilion KL – 1.3 million square feet of net lettable area – which is valued at RM3.4 billion.
The trust also manages Pavilion Tower – a 20-storey office tower with 167,700 sq feet of net lettable area – which is valued at RM128 million.
Pavilion KL is one of the most popular complexes in the city. With a diversified tenant base comprising everything from supermarkets (Parkson) to high-end fashion outlets (Prada, Gucci), it boasts an occupancy rate of 99 per cent. Average rental rates are around RM17 per sq foot for retail space and RM6 per sq foot for office space.
HwangDBS said that the trust’s growth would be driven by positive rental conversions from expiring leases. Around 67 per cent of leases are due to expire in 2013 which the research firm said ‘would lift our FY13 revenue forecast by 4 per cent year-on-year – assuming a 5 per cent rental hike – to RM325 million.’ But growth for next year would be ‘marginal’ as only 5 per cent of the leases are slated to expire.
The trust is expected to use 93 per cent of its gross proceeds to part finance its purchase price of RM3.3 billion which would give it a gearing after listing of some 20.1 per cent, well below the required 50 per cent limit. That was positive, HwangDBS said, because ‘it suggests that it could borrow up to RM1 billion to fund future acquisitions.’ The research house set its target price at RM1.
The initial public offering of Pavilion Reit will be the fourth largest in Malaysia this year after those of Bumi Armada Bhd, MSM Malaysia Holdings Bhd and UOA Development Bhd.
The demand by investors for shares exceeded supply by over 40 times for MSM and Bumi Armada’s offerings. In Pavilion’s case, it was by 26 times.
Pavilion – thestar
The largest retail REIT in the country offers premium of 12 sen
The largest retail REIT in the country was also the most traded counter yesterday with 197.3 million shares changing hands, while the FTSE Bursa Malaysia (FBM) KLCI was up 0.14% or 2.07 points to 1,482.99.
“Moving forward, we are committed to enhance unitholders’ return and value through the organic growth of our existing portfolio as well as visible growth via acquisition,” he told reporters after the company’s listing ceremony yesterday.
Currently, Pavilion REIT consists of Pavilion KL Mall – a retail mall with a net lettable area of 1.3 million sq ft and 450 retail tenants as well as the Pavilion Tower that contributed 96.4% to the group’s revenue.
Ho said the company would continue to focus on the retail sector and seek opportunities to expand assets in Penang, Johor and the Klang Valley to build up its portfolio.
“It’s hard to put a figure to our expansion but we will evaluate any financially viable investment opportunity that comes around,” he said.
Ho said expansion was on top of the company’s trustees that had signed three rights of first refusal (ROFR) to acquire Farenheit88, the Pavilion Mall’s extension, and also another mall in USJ, Subang Jaya.
On overseas expansion, he said the management would evaluate opportunities when presented, but presently the company’s focus was the local market.
The institutional offering of the Pavilion REIT initial public offering (IPO) was oversubscribed by 28 times and the retail offering was oversubscribed by 7.5 times.
Pavilion REIT IPO raised gross proceeds of RM710mil.
“We believe this listing exercise will provide investors with an opportunity to invest in a REIT that provides stable distribution of income and strong capital appreciation potential,” he said.
Pavilion REIT Management or the manager principle activity is to manage and administer Pavilion REIT. The manager is 51%-owned by Urusharta Cermerlang Development Sdn Bhd and the remaining 49% owned by Urusharta Cemerlang Project Corp Sdn Bhd.
Pavilion – BT
Pavilion REIT seeks expansion
PAVILION Real Estate Investment Trust (Pavilion REIT), the largest retail REIT in Malaysia, is eyeing more local assets to spur growth.
Pavilion REIT Management Sdn Bhd chief executive officer Philip Ho said the trust is seeking opportunities to expand its assets in Penang, Johor and the Klang Valley.
Ho said Pavillion REIT will evaluate any financially viable investment opportunity that comes around.
“As a retail real estate investment trust, our duty is to acquire malls and build up the portfolio,” he told reporters after its listing ceremony here.
Ho said the company’s trustees had signed three rights of first refusal (ROFR) to acquire Farenheit88, the Pavilion Mall’s extension, and a mall in USJ Subang Jaya.
With an appraised value of RM3.54 billion, Pavilion REIT is currently made up of two assets – Pavilion Mall and Pavilion Tower.
The mall, which contributes 96.4 per cent to the appraised value, has 1.3 million sq ft of net lettable area.
It boasts of about 450 retail tenants, making it the largest premium retail fashion mall in Malaysia.
Pavilion REIT yesterday fetched a 13.3 per cent premium over its offer price on its debut on Bursa Malaysia.
It opened at RM1.03, 13 sen higher than its institutional price of 90 sen, with 15.7 million unit shares traded.
Ho said the listing provides the company with direct access to capital markets, thereby strengthening its financial capacity to seize new opportunities in the country.
“We are committed to enhance unitholders’ return and value, both through the organic growth of our existing portfolio as well as visible growth via acquisitions,” he added.
Pavillion – BT Singapore
Pavilion Reit raising RM710m in IPO
(KUALA LUMPUR) Pavilion Real Estate Investment Trust, a Malaysian shopping mall trust part-owned by Qatar Investment Authority, is raising RM710 million (S$291 million) in an initial public offering, two people with knowledge of the matter said.
The company plans to sell units at 90 sen apiece to institutions and at 88 sen to retail investors, said the people, who asked not to be identified as pricing details are private.
Pavilion Reit had marketed the units at 88 sen to 90 sen. Demand exceeded supply by more than 26 times, one of the people said.
The IPO will be the South-east Asian nation’s fourth biggest this year, after share sales by Bumi Armada, UOA Development and MSM Malaysia. Investor demand for shares exceeded supply by more than 40 times for Bumi Armada and MSM’s offerings.
‘It’s probably due to the scarcity factor for big, good-quality IPOs and an appetite for new stock in Malaysia, which seems to be a defensive market,’ said Christopher Wong, a Singapore-based senior investment manager at Aberdeen Asset Management Asia Ltd, which oversees more than US$90 billion of regional equities.
Kuala Lumpur-based Pavilion Reit, which is expected to list next month, has a distribution yield forecast of as much as 6.73 per cent based on the fiscal 2012 earnings estimate, according to a note to investors.
The company owns the Pavilion mall and an adjacent office tower in the capital’s Bukit Bintang area, which Malaysia is developing to rival Singapore’s Orchard Road.
The mall, with a gross floor area of 2.2 million square feet, has an appraised value of RM3.4 billion as of June 1, according to its prospectus, and houses luxury retailers including Bulgari SpA and Prada SpA. — Bloomberg
Pavilion – BT
Pavilion Reit to market IPO at 90 sen/unit
Pavilion Real Estate Investment Trust, a Malaysian retail property trust, is marketing its initial public offering to institutions at 88 sen to 90 sen per unit, according to a note sent to investors.
The company expects a distribution yield of as much as 6.73 percent based on its 2012 earnings estimates, the note said. — Bloomberg