Sabana prices Singapore’s first Shari’ah-compliant REIT

The Sabana Shariah Compliant REIT, which owns industrial properties in Singapore, has priced its IPO at SGD 1.05 a share, the midpoint of an indicative range, to raise $491 million, according to local press reports
Sabana prices Singapore’s first Shari’ah-compliant REIT

Sabana prices Singapore’s first Shari’ah-compliant REIT

The REIT (real estate investment trust) is the first Islamic REIT in Singapore and the largest Shariah-compliant property trust in the world. It is not the first in the region, three small Islamic REITS are trading in Kuala Lumpur. Sabana is reported to have chosen to adopt a strict interpretation of Shar’iah compliance so as to appeal to the Islamic investment community in the Middle East as well as that in Malaysia.
The retail tranche of the initial public offering (IPO) closes on 24 November. Sabana controls 15 industrial properties in Singapore with an aggregate floor area of about 3.3 million square feet. Most of the properties are located near industrial zones and key transport links such as Changi Airport, shipping ports and major expressways, with an average lease term to expiry of 3.8 years.
The manager of the REIT had forecast in a draft prospectus a distribution yield of 8.45 per cent for 2011 and 8.48 per cent for 2012 based on the minimum offer price of SGD 1.00. At the indicated price the yield for 2011 is 8.22 per cent.
FIL Investment Management Hong Kong, a unit of US fund manager Fidelity, and Bahrain’s al-Salam Bank are among the cornerstone investors in the IPO. HSBC is the sole financial adviser for the IPO and is joint global coordinator, bookrunner and underwriter with United Overseas Bank and Daiwa.

The Sabana Shariah Compliant REIT, which owns industrial properties in Singapore, has priced its IPO at SGD 1.05 a share, the midpoint of an indicative range, to raise $491 million, according to local press reports

The REIT (real estate investment trust) is the first Islamic REIT in Singapore and the largest Shariah-compliant property trust in the world. It is not the first in the region, three small Islamic REITS are trading in Kuala Lumpur. Sabana is reported to have chosen to adopt a strict interpretation of Shar’iah compliance so as to appeal to the Islamic investment community in the Middle East as well as that in Malaysia.
The retail tranche of the initial public offering (IPO) closes on 24 November. Sabana controls 15 industrial properties in Singapore with an aggregate floor area of about 3.3 million square feet. Most of the properties are located near industrial zones and key transport links such as Changi Airport, shipping ports and major expressways, with an average lease term to expiry of 3.8 years.
The manager of the REIT had forecast in a draft prospectus a distribution yield of 8.45 per cent for 2011 and 8.48 per cent for 2012 based on the minimum offer price of SGD 1.00. At the indicated price the yield for 2011 is 8.22 per cent.
FIL Investment Management Hong Kong, a unit of US fund manager Fidelity, and Bahrain’s al-Salam Bank are among the cornerstone investors in the IPO. HSBC is the sole financial adviser for the IPO and is joint global coordinator, bookrunner and underwriter with United Overseas Bank and Daiwa.

http://www.cpifinancial.net/v2/News.aspx?v=1&aid=6552&sec=Islamic%20Finance

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