Singapore Retail REITs - DBS Research 2022-06-23: Mercatus ~ Prized Retail Portfolio Up For Grabs

• Possible landmark transaction involving Mercatus’s four dominant suburban retail malls to mark the “real estate deal of 2022”.
• Singapore real estate allures international investors as a store of wealth; retail incumbents will be keen to get their hands on it.
• Suburban capital values to remain resilient despite rising interest rates, ahead of expectations.
• - Read this at SGinvestors.io -

Possible landmark transaction involving Mercatus’s retail mall portfolio will be keenly watched.

• Mercatus is looking at possibly divesting its stakes in four suburban retail malls (AMK Hub, Jurong Point, NEX, and Swing By @ Thomson Plaza) for a reported ~S$4.0bn. We are excited by this sizable opportunity, given the lack of tight ownership of retail real estate in Singapore.
• - Read this at SGinvestors.io -
• Assuming a 68%-70% operational margin, we estimate FY21 yields to range between 4.3%-4.4% (pre-COVID yields were 4.6%-4.8%), which is at a similar level to recent transactions within the retail space.

Singapore real estate’s enduring allure likely to evoke strong interest amongst the local incumbents.

• Read more at SGinvestors.io.

Geraldine WONG DBS Group Research | Derek TAN DBS Research | https://www.dbs.com/insightsdirect/ 2022-06-23 SGinvestors.io

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