Singaporean firm ponders listing in HK
Singaporean developer Ascendas said it was considering listing a real estate investment trust (reit) in Hong Kong, which would make it the second yuan-denominated initial public offering outside the mainland.
'Hong Kong has its own unique characteristics,' president and chief executive Chong Siak-ching said. 'Hong Kong has been able to attract even European countries to list on its stock market, so the profile of the companies is very different [than in Singapore]. So Hong Kong would also be one destination we look at.'
Ascendas was set up 10 years ago in the merger of Arcasia Land and JTC International's Business Parks and Facilities Group in Singapore. Its properties range from office buildings to science and industrial parks to logistics centres and warehouse retail facilities.
Beginning with a portfolio of assets under management worth S$1.2 billion (HK$ 7.61 billion) in 2001, the group has expanded to manage properties totalling at least S$10 billion and 45 million square feet in more than 30 cities across 10 countries including China, India, South Korea and Vietnam.
Ascendas manages properties through its two reits and seven private funds.
In 2002, the company listed its first business and industrial space reit, Ascendas Reit, on the Singapore Exchange with eight properties worth S$545 million. Its portfolio has grown rapidly and now includes 93 properties valued at around S$6 billion. Chong said. Four years ago, it listed the Ascendas India Trust in Singapore, the city-state's first listed business trust holding.
The company first entered the mainland in 1995, when it pioneered the ready-built facility industrial park concept in Suzhou, Jiangsu, Chong said. Now the mainland is the firm's third-largest market with assets under management worth S$1.6 billion providing 9 million square feet of business space in 10 cities.
It has two private funds on the mainland. One has invested up to S$800 million in three grade-A office towers in Shanghai, while the other has S$600 million invested in industrial and business park. 'Both of these funds are fully invested,' Chong said, but she added the developer had not yet set any timetable for listing the mainland properties.
Apart from Hong Kong, the company will also consider listing the properties in Singapore and perhaps on the mainland, if it permits reit listings in the future.
'The important thing is which one will maximize value for investors and also be in the best position to attract investors to a particular product,' Chong said.
Asked why it may consider listing a reit denominated in yuan, she said: 'There is a growing interest in renminbi products so the renminbi reit is a good and interesting opportunity. We need to make sure that whatever product that we have, we are able to attract investors from as wide a reach as possible. So we watch with a lot of interest any new developments that are coming into the market and the renminbi reit is one of them.'
Chong said she was optimistic about the outlook for the mainland property market, saying that as its economy continues to grow, business will expand and that will translate into demand for office and commercial space.
Ascendas last week signed an agreement with Singbridge International and Guangzhou Development District to jointly develop a 30 hectare integrated business park in Guangzhou. It holds a 52 per cent stake in the 2.3 billion yuan (HK$2.8 billion) project, expected to offer 600,000 square metres of business space.
Chong said the company was also looking to enter cities such as Chengdu and Chongqing since their clients were expanding to the west.