Great Eagle Holdings aims to raise as much as $7.1 billion with the Champion Reit, its single-building real estate investment trust spin-off that begins its roadshow today.
According to a term sheet sent to investors, Champion Reit, which comprises only the Citibank Plaza in Central, will sell 1.23 billion units at $5 to $5.75 each, giving a yield of 4.84 to 5.57 per cent.
This compares with the Link Reit's 3.63 per cent yield and the Prosperity Reit's 5.26 per cent based on yesterday's closing share prices. The mainland-focused GZI Reit's yield is 6.38 per cent.
'I think the yield offered is attractive, although the price upside cannot be compared with the Link,' said Alex Wong, a fund manager at Shenyin Wanguo Asset Management (Asia).
'The Champion Reit is already managed commercially, which was not the case for the Link [formed from shopping centres and car parks in public housing estates]. This means the room for improvement is smaller.
'However, I believe investors are still willing to buy if the yield stands above 4 per cent, but they should consider it as a yield play rather than a growth play.'
The reit's roadshow starts today in Hong Kong and is followed by a presentation in Singapore on Friday. The public offer is scheduled to open next Thursday, with the reit due to list on May 24.