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OUE REIT (SGX:TS0U) said it divested Crowne Plaza Changi Airport for S$500m at a 1.3% premium to its appraised value ahead of expiry of its hotel management and master lease agreements in 2028. Net proceeds will be deployed to debt repayment, acquisitions, asset enhancement initiatives and capital management, alongside S$20m of special distributions in the next two years.
Monetising the mature asset
- - Read this at SGinvestors.io -
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The transaction forms part of management's capital recycling strategy to unlock value from a mature hospitality asset ahead of the expiry of its hotel management agreement and master lease in 2028, while avoiding the substantial refurbishment and rebranding capex that would otherwise be required.
Saving from finance expense
- - Read this at SGinvestors.io -
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On a pro-forma basis, aggregate leverage is expected to decline from 41.5% to 36.6%, creating meaningful debt headroom to support further acquisitions, including an increased stake in Salesforce Tower.
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Crowne Plaza Changi Airport contributed ~10% of FY25 revenue. While the divestment will result in a loss of income in FY27E, management estimates that OUE REIT's DPU could increase by 5.8% after taking into account the special distribution.
Maintain BUY with unchanged target price of S$0.45
- Read more at SGinvestors.io.
Above is an excerpt from a report by Maybank Research.
Clients of Maybank Securities may be the first to access the full PDF report @ https://www.maybanktrade.com.sg/.
Liu Miaomiao Maybank Research | https://www.maybanktrade.com.sg/ 2026-06-26
Previous report by Maybank:
2026-04-22 OUE REIT - Resilient Start; Building Growth.
Price targets by 2 other brokers at OUE REIT Target Prices.
Listing of research reports at OUE REIT Analyst Reports.
Relevant links:
OUE REIT Share Price History,
OUE REIT Announcements,
OUE REIT Dividend Payout Dates & Corporate Actions,
OUE REIT News
