First REIT

[weijian]

i remember their prospectus stated that the manager was going to cover the indon hospitals' maintanence fees for the 1st 2 years after IPO, beyond which it will be charged to First Reit. Has this been done already?

[Gregg]

Managed to get their CFO reply.

1) The higher expenses that resulted shrink in net property income compare to Q2 was actually due to exchange loss on USD loan that used to finance the acquisition of Sarang hospital.
2) First Reit still keeping $6.4~6.5mil (divestment gain) after distributing some portion to unitholder in Q3. They did not rule out that this amount of money might be used to finance next acquisition
3) First Reit is negotiating with the bank to roll over the $48mil debt which due in June 2012.
4) First Reit is still negotiating with parent company on the injection of new hospital but it is not that aggressive due to current market condition.At the same time First Reit also discussing with bank in the event that they need loan to finance the acquisition.

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i remember their prospectus stated that the manager was going to cover the indon hospitals' maintanence fees for the 1st 2 years after IPO, beyond which it will be charged to First Reit. Has this been done already?

Hi Wei Jian,

Just get their reply
The maintenance cost is under tenant and was covered in the lease contract.

[Jared Seah]

Is this forum great or what!? Thanks Gregg for your questions to First Reit on our behalf !!!

[Gregg]

I believe what First REIT mentioned about new hospital negotiation with Sponsor should be Balikpapan and Jambi.

I was checking sponsor company lippo Annual report and news over the weekend,they currently have 7hospitals which 5 already injected to First REIT,the other two were Balikpapan and Jambi.they bought @ price of US$26 million and US$18 million respectively in Nov2010

If this is the case, in term of loan amount, it is just little debt base on current gearing.
http://siloamhospitals.com/system/files/...download=1


http://siloamhospitals.com/system/files/...download=1

[Gregg]

Strong result from sponsor company.....

http://www.lippokarawaci.co.id/corporate...spx?ref=93

[Gregg]

By Carmen Lee
Wed, 30 Nov 2011, 08:49:41 SGT

Market Pulse: First REIT, CapitaLand & Lian Beng (30 Nov 2011)

FOCUS

First REIT: Visit to Sarang Hospital in South Korea

Summary: We visited First REIT’s (FREIT) recently acquired Sarang Hospital (SH) in South Korea. SH enjoys a high occupancy rate and uses an electronic health records system to improve its operating efficiency. It achieved operational breakeven despite opening only in Jun 2010. As this is FREIT’s maiden acquisition in South Korea, we concur with management’s prudent approach initially as execution risks exist in a new operating environment. FREIT has secured ten months of rental security deposit as collateral and we estimate that SH would form only 1.4% and 3.4% of our FY11 and FY12 gross revenue estimates, respectively. Nevertheless, we opine that South Korea’s healthcare market has good growth prospects and this pilot venture could provide FREIT with an avenue for possible future acquisitions. We continue to like FREIT for its proxy to the growing healthcare scene in the region, rental stability and visibility and defensive master lease structure. Maintain BUY and S$0.84 fair value estimate. (Wong Teck Ching Andy)

[Nick]

By Carmen Lee
Wed, 30 Nov 2011, 08:49:41 SGT

Market Pulse: First REIT, CapitaLand & Lian Beng (30 Nov 2011)

FOCUS

First REIT: Visit to Sarang Hospital in South Korea

Summary: We visited First REIT’s (FREIT) recently acquired Sarang Hospital (SH) in South Korea. SH enjoys a high occupancy rate and uses an electronic health records system to improve its operating efficiency. It achieved operational breakeven despite opening only in Jun 2010. As this is FREIT’s maiden acquisition in South Korea, we concur with management’s prudent approach initially as execution risks exist in a new operating environment. FREIT has secured ten months of rental security deposit as collateral and we estimate that SH would form only 1.4% and 3.4% of our FY11 and FY12 gross revenue estimates, respectively. Nevertheless, we opine that South Korea’s healthcare market has good growth prospects and this pilot venture could provide FREIT with an avenue for possible future acquisitions. We continue to like FREIT for its proxy to the growing healthcare scene in the region, rental stability and visibility and defensive master lease structure. Maintain BUY and S$0.84 fair value estimate. (Wong Teck Ching Andy)

Full Report: http://www.ocbcresearch.com/pdf_reports/...30-OIR.pdf

Pretty informative with the description of their ROFR in South Korea.

(Vested)

[Gregg]

By Carmen Lee
Wed, 30 Nov 2011, 08:49:41 SGT

Market Pulse: First REIT, CapitaLand & Lian Beng (30 Nov 2011)

FOCUS

First REIT: Visit to Sarang Hospital in South Korea

Summary: We visited First REIT’s (FREIT) recently acquired Sarang Hospital (SH) in South Korea. SH enjoys a high occupancy rate and uses an electronic health records system to improve its operating efficiency. It achieved operational breakeven despite opening only in Jun 2010. As this is FREIT’s maiden acquisition in South Korea, we concur with management’s prudent approach initially as execution risks exist in a new operating environment. FREIT has secured ten months of rental security deposit as collateral and we estimate that SH would form only 1.4% and 3.4% of our FY11 and FY12 gross revenue estimates, respectively. Nevertheless, we opine that South Korea’s healthcare market has good growth prospects and this pilot venture could provide FREIT with an avenue for possible future acquisitions. We continue to like FREIT for its proxy to the growing healthcare scene in the region, rental stability and visibility and defensive master lease structure. Maintain BUY and S$0.84 fair value estimate. (Wong Teck Ching Andy)

Full Report: http://www.ocbcresearch.com/pdf_reports/...30-OIR.pdf

Pretty informative with the description of their ROFR in South Korea.

(Vested)

Thanks for report,can't wait for their next acquisition in Korea

(vested)

[Gregg]

ANNUAL VALUATION OF PROPERTIES

http://firstreit.listedcompany.com/newsr...91F0.1.pdf

[PeterSoh]

Hi, just curious, with all the news in straits times that properties are 'losing heat' in Singapore, I was wondering how this might affect REITs and what are some people's opinions about investing into a REIT now.