Metro Holdings

During one of the AGM , one shareholder did bring up this issue , management felt not all properties could go into reit , one property is Metro City in Shanghai , the least left only 17 years , unlikely PRC gov will renew the lease . Metro not sure about the renewal either.
So reit is not that easy for Metro to execute.

(14-07-2013, 09:13 PM)cfa Wrote: During one of the AGM , one shareholder did bring up this issue , management felt not all properties could go into reit , one property is Metro City in Shanghai , the least left only 17 years , unlikely PRC gov will renew the lease . Metro not sure about the renewal either.
So reit is not that easy for Metro to execute.

Ya, I remember someone asked if management is worried about some of the properties with leases that are running down (<20 yrs remaining)
and the reply was that the cashflow projected from the remainder of the leases would more than cover any initial investment.
But I guess with shorter leases and with less than a majority stake in several of their assets, it can be difficult to create a REIT.

(14-07-2013, 09:58 PM)GFG Wrote:

(14-07-2013, 09:13 PM)cfa Wrote: During one of the AGM , one shareholder did bring up this issue , management felt not all properties could go into reit , one property is Metro City in Shanghai , the least left only 17 years , unlikely PRC gov will renew the lease . Metro not sure about the renewal either.
So reit is not that easy for Metro to execute.

Ya, I remember someone asked if management is worried about some of the properties with leases that are running down (<20 yrs remaining)
and the reply was that the cashflow projected from the remainder of the leases would more than cover any initial investment.
But I guess with shorter leases and with less than a majority stake in several of their assets, it can be difficult to create a REIT.

During AGM, management again reiterated that the REIT structure is not appropriate at this stage, but didn't go on to elaborate any further

The fact is Metro doesn't own a property in Singapore, even can put all overseas properties into a reit , the reit will not enjoy certain tax benefit.

(17-07-2013, 02:11 PM)cfa Wrote: The fact is Metro doesn't own a property in Singapore, even can put all overseas properties into a reit , the reit will not enjoy certain tax benefit.

The idea of REIT is not for tax benefit right?
Isn't it a way to monetize the asset, as well as unlock shareholder value if the share price is below the NAV?

I am guessing as most properties r overseas, management feels it is difficult to sell into a REIT as many ppl don't know the property and thus we r unlikely to get a gd price

(17-07-2013, 06:37 PM)GFG Wrote:

(17-07-2013, 02:11 PM)cfa Wrote: The fact is Metro doesn't own a property in Singapore, even can put all overseas properties into a reit , the reit will not enjoy certain tax benefit.

The idea of REIT is not for tax benefit right?
Isn't it a way to monetize the asset, as well as unlock shareholder value if the share price is below the NAV?

I am guessing as most properties r overseas, management feels it is difficult to sell into a REIT as many ppl don't know the property and thus we r unlikely to get a gd price

Reit the properties, but not taking advantage of tax incentive ? This will not be an attractive reit.

Just took a look at Metro Q1 result. They are trading at just 0.6 PB!

haha!

Tell that to shareholders of superbowl and Hiap Hoe before the "half-hearted" offer.

Hi camelking,

Care to share a little bit of the story? Was not following anything on Metro till today.

Thanks.

sorry,

What i was trying to say is metro trading at 0.6 PB is still far better than what superbowl and hiap hoe was trading at.
Superbowl was trading around 50cents.....ie 35% of RNAV estimated at $1.40.



Vested in metro and superbowl....