Heeton Holdings

[propertyinvestor]

directors wife continue to load up on Heeton shares

[propertyinvestor]

Positive rental reversions from sun plaza and tampines mart will contribute positively to Heeton's profit in the next quarter results. Income recognition for Sky Green to commence only next year though.

[propertyinvestor]

Heeton's profit declined mainly because of the absence of profit recognition for development project. I note that they have bought 2 land parcels in London for development.

The next catalyst to look forward to is the opening of AM100 at amara hotel that will boost activity in the area. Heeton is likely to launch El Centro redevelopment in Q1 2013.

[propertyinvestor]

I declare Heeton the most undervalued property stock with significant upside! NAV of 1.12 and RNAV of $1.60 if the tanjong pagar redevelopment project proceeds as planned in Q1 2013.

[l0nEr]

Hmmm... after the new policies.. do you still think Heeton is the most undervalued property stock??? Especially since Heeton derives most of its income from Singapore. Will the Tanjong Pagar redevelopment project be affected?

[paullow]

policies would likely affect new lauches but unlikely to affect ppty prices so soon, if any. so valuation wise, indeed heeton is still deeply undervalued, maybe one of the most underv ppty stocks. even if ppty pricrs drop by significant percentage, it will affect majority of ppty counters, not only heeton.

[Greenrookie]

policies would likely affect new lauches but unlikely to affect ppty prices so soon, if any. so valuation wise, indeed heeton is still deeply undervalued, maybe one of the most underv ppty stocks. even if ppty pricrs drop by significant percentage, it will affect majority of ppty counters, not only heeton.

Not actually, Heeton is heavily geared and low on cash, there is a risk of cash flow management, i think that is the reason the market valuing it at such a discount.

[bongiovi]

I also like Heeton. My take is RNAV above $2 based on profits from all its projects and redevelopment of El Centro. Hope El Centro will be launched soon since existing tenants are already told their leases will not be renewed by Q1 2013.

Depending on assumptions of GFA n ASP, and book value of existing building, gross profit from redeveloping El Centro site can range from $60 to $100 million!

Much buying today although someone trying to sell it down. [/b]

Sellers today from DMG. ^^

See my earlier post on the launch of El Centro. Launch price is guaranteed to be a minimum of 3200psf for a freehold project beside Keppel Towers and a stone throw from AM100.

I realised that the apartments at El Centro-Tanjong Pagar are up for rent (Posted in Jan 2013) as quote in the website is "till 31/12/2013 but subject to changes".

http://www.propertyguru.com.sg/project-l...905/rent/1

If that is the case, does it means that there will not be any redevelopment for El Centro in Q1 2013 Let us give it some thoughts.

[Vseeker]

Reasons Heeton trade at huge discount to RNAV might be becoz it loves "hoarding inventories" of completed projects and also dun pay much in dividends.
However the ever widening huge discount to RNAV is making the stock more and more attractive going forward,
esp. now that gahmen is making it real painful to hoard inventories !! Mr Heeton will be forced to improve on its Inventory Turnover Rate !!.

Here's my take on El Centro
As a QC Holder, (like any other foreign developer) Heeton is required to sell off all the units in the completed ElCentro (existing El Centro just TOP in 1st half 2004)
somehow after its TOP in 2004, Heeton manage to secure permission to sublets out the units (instead of selling all units within 2-yrs after TOP)...

then in post subprime crisis Budget2009, parliament enacted Assistance Measures for the Property Market, including below
...c) Giving QC holders up to four years [from date of issue of TOP] to dispose of all private residential units in the development, and
...d) Allowing QC holders to rent out unsold private residential units for a max of four years (from date of issue of TOP or date of application, whichever is later).

Obviously Heeton took advantage of the latter, and obtained permission to continue as El Centro's landlord for a further 4 yrs.
the 4-yrs timeline starting from 2009 => expiring this year - 2013 !!.

To avoid paying penalty (Extension Premiums) for El Centro, Heeton now have two options:
I) Sell off all units in existing El Centro superf fast to avoid paying Extension PRemium
OR
II) redevelop the current El Centro !! and get a fresh 5-yrs timeline to complete and sell off all units.

==> seem that Heeton was going for option II,
but now with all the new restrictions preventing "free GFAs" from being crave out of rooftop & ground levels,
its less clear now, whether Heeton will change it plans yet again !!

[propertyinvestor]

policies would likely affect new lauches but unlikely to affect ppty prices so soon, if any. so valuation wise, indeed heeton is still deeply undervalued, maybe one of the most underv ppty stocks. even if ppty pricrs drop by significant percentage, it will affect majority of ppty counters, not only heeton.

Not actually, Heeton is heavily geared and low on cash, there is a risk of cash flow management, i think that is the reason the market valuing it at such a discount.

Where got cashflow problems? The rental yield on Sunplaza alone is in excess of 11% every year. Borrowings are also secured against the future profit stream of their development projects.