Martin Lee @ Sg
Sharing is Caring!

Sabana Reit IPO

Sabana Shari’ah Compliant Industrial Real Estate Investment Trust (Reit) launched its initial public offering yesterday.

Sabana Reit will be Singapore’s first Reit that conforms to Islamic finance principles. The 15 industrial properties that it holds will be managed in line with Islamic principles.

Out of the 508 million units available in its initial public offering (IPO), about 432.5 million units will be for large institutional investors while the balance 75.5 million will be for retail investors.

The units will be priced at $1.05 per unit.

Based on the expected distribution of 8.63 cents per unit for next year, the units will give a yield of 8.22 per cent.  The yield for 2012 is expected to be 8.25 per cent or 8.67 cents per unit.

The offering closes at 6pm on Wednesday with trading expected to start at 2pm on Friday.

The Sabana Reit IPO prospectus can be downloaded here:

Sabana Reit IPO Prospectus

Leave a Comment:

lioninvestor says 9 years ago

As it turns out, the IPO turns out to be a flop (for now). Trading below IPO price.

    misterlts says 9 years ago

    Agreed, and I wonder who is the stablising manager ???

      VSL says 9 years ago

      Let’s analyse this IPO.

      1. Public tranche is 12.5 oversubscribed, which is pretty high.
      2. Dividend yield is very high @ 8.22%. Better than DBS 4.7% or MapleTree Industrial.
      3. There was ballotting. Not every successful applicant was alloted shares. So there must be disappointed investors around.
      4. The first and biggest Shariah compliant REIT in sg, managing sg properties. A less risky invetment, meant for conservative investors.

      With all factors in its favour I am surprised that it is initially trading below water. Perhaps we are suffering from IPO burnout. Perhaps interest rates are rising soon, though I don’t think so.

      With low prices, unsatisfied investors will now go in and get an even better yield, pushing up the market price.

        lioninvestor says 9 years ago

        I think markets are slightly spooked at this moment.

VSL says 9 years ago

Hi Lion,

If this is not a snap IPO, I don’t know what is. Why the rush?

Out of the 75.5 mil units available to the public, only 25.5 mil is for the man in the street, with 50 mil units reserved for directors, employees etc. Looks like this IPO is not targetted at the average Joe. With high dividend rate and quarterly payouts, I think this offer will be heavily oversubscribed. What do you think?

What will happen if this REIT gets delisted? How will unitholders be able to cash out? Tks.

    lioninvestor says 9 years ago

    Usually if a company delists, they will make an exit offer.

Add Your Reply