Ho Bee Land (formerly: Ho Bee Investment)

[opmi]

I think ho bee is in the maintenance mode. No big risk taking.
Just focus on recurrent income.

[DP28]

Ho Bee has been buying up and building office buildings....Most probably a REIT is in the offspring. The boss has been doing share buyback to increase his stake but lately he is buying up shares personally.

Whether he would privatise the company first then reit the buildings or reit the buildings and pay up cash/or privatise remains to be seen. I think very much depends on the share price........ on what he would do. Personally I believe he would reit the office buildings first and then distribute cash. He needs some time to maximise the revenue and profit first as Metropolis is only up recently....

It is one of the option to monetize their recurring income thru REITs. But given their scale, Metropolis plus london rose court is too small to structure a REIT.

From another point is, if Metropolis is gonna yield him $7-8m a month with entire company gearing at 30%, does he really want to share that recurring income with you?

But safety first has a point, he does not a have secondary company that is listed. Hence, he may not privatised at all.

[greengiraffe]

Gold Coast apartment market changing – slowly
PUBLISHED: 16 JUN 2014 00:14:55 | UPDATED: 16 JUN 2014 13:05:41

MICHAEL BLEBY

Leo Zhang and his wife have just bought an apartment in Harbour Quays, a master plan development north of the Gold Coast Highway.

For Mr Zhang and his family, who only moved into the suburb eight months ago, the attraction of Harbour Quays for an investment is clear. “There are lots of families living here,” he said.

Investors like Mr Zhang – who hopes to buy three more investment properties by year-end – are getting in to an apartment market that is once again starting to show signs of life, after the global financial crisis and over-supply caused a four-year slump in prices.

The median price of a Gold Coast apartment ticked down in the three months to April – a quiet selling season – to $355,250 from $360,000 in the three months to January.

But overall the market is up on the recent trough of $340,000 in the quarter to October 2012, according to figures from Fairfax Media’s Domain group. “It looks like the market has bottomed out,” said Andrew Wilson, Domain senior economist. “The prospects for demand are on the rise for a number of factors. Investors are starting to recognise that Gold Coast apartments are a good medium-term prospect.”

Detached house prices have started to rise, gaining 2.2 per cent in the three months to April to a median price of $497,000, and apartments are likely to play catch-up, Dr Wilson said.

DEMOGRAPHIC CHANGES IN THE AREA
In addition to a strengthening economy that is driving investors from overseas and interstate – particularly those from Sydney and Melbourne, who are attracted by property that is cheaper than in their own cities – the rise in demand is coming from demographic changes in the area.

More people are living there. While Gold Coast City’s population rose 14 per cent to 494,496 at the time of the 2011 census from five years earlier in 2006, the proportion of empty-nesters and retirees aged between 60 and 69 years jumped 26 per cent to 51,639. The proportion of people aged between 18 and 24-years-old remained the same, as did that for 25- to 34-year-old workers.

Greater absolute numbers of long-term residents, and a growing proportion of retirees, is pushing demand for a housing market that suits long-term residents, in contrast to one predominantly focused on tourism.

Mr Zhang said the likely tenants in his new apartment at developer Emandar Group’s Levanto project – which will only be completed in August – would be families or professionals.

Different demographics demand different products, and the larger two- and three-bedroom apartments that were predominant in the region are losing ground to smaller one- and two-bedroom apartments suited to a younger rental market. More than half – 52 per cent – of the region’s future supply of 13,846 apartments – the total of those approved, in application as well as approved and deferred – are two-bedroom properties and 29 per cent have one bedroom, according to research analyst Urbis’s March quarterly report.

New supply is still limited. The Gold Coast had just 634 apartments for sale in the March quarter, the Urbis report said. Of those, most of those were apartments under construction or already completed, rather than being available off-plan new stock.

NOT A LOT OF STOCK COMING
“It shows a very limited available supply of choice,” said Urbis associate director Jon Rivera. “There isn’t a lot of new stock coming onto the market.”

The dearth is also helping the sale of expensive apartments that have ­languished unsold. Brookfield Multiplex’s Hilton Orchard Tower at Surfers Paradise sold the last five of its 224 apartments – with an average sale price of $1.66 million – during the March quarter, along with the last of its cheaper Hilton Boulevard apartments.

The effect is limited, however. Developer Juniper’s Soul on the Gold Coast also sold 16 more apartments in the quarter, but 76 of the 289 in the development – which go at an average sale price of $1.26 million – remained unsold, Urbis said.

The new apartments coming to the market, such as a 41-storey, 223-apartment development that Singapore developer Ho Bee and Brookfield Multiplex are building on the corner of Surfers Boulevard and Main Beach Parade, are likely to draw outside investors in a way it hasn’t before.

“A lot of the stock is going to transact quite rapidly,” Mr Rivera said. “It’s not going to be sold to the local market or traditional retail. The [Gold] Coast this time will see a lot more international activity from China, as well as from interstate investors in Sydney and ­Melbourne particularly.”

Local real estate agents are frustrated. “If you just look at the construction side – we haven’t had any new buildings built or started in the past six years,” said Andrew Bell, the chief executive officer of Ray White Surfers Paradise. “This is the longest void of non-construction the [Gold] Coast has experienced in the past 40 years.”

[BlueKelah]

Boss continue to up his stake now standing at 72.7% @ current price of ~$2.25

Delisting? I think so too now...

only a few more percent to go, with gearing coming down and income coming in, only a matter of time.
General manager since 2001 also retired in April.

Does this happen with delisting? staff start retiring and vacate position for family members to take over when delisted. Similar thing happening with Hong Fok also...

Can start collecting with this boss...(quite good discount to the new NAV of $3.48 anyways.) If share price keep dropping or maintain at $2+ with low volume, soon the boss man will own 80%

P.S. I am going through all the H counters this week hence my proliferative postings on H counter...

[yenyenpark]

Ho Bee has been buying up and building office buildings....Most probably a REIT is in the offspring. The boss has been doing share buyback to increase his stake but lately he is buying up shares personally.

Whether he would privatise the company first then reit the buildings or reit the buildings and pay up cash/or privatise remains to be seen. I think very much depends on the share price........ on what he would do. Personally I believe he would reit the office buildings first and then distribute cash. He needs some time to maximise the revenue and profit first as Metropolis is only up recently....

It is one of the option to monetize their recurring income thru REITs. But given their scale, Metropolis plus london rose court is too small to structure a REIT.

From another point is, if Metropolis is gonna yield him $7-8m a month with entire company gearing at 30%, does he really want to share that recurring income with you?

But safety first has a point, he does not a have secondary company that is listed. Hence, he may not privatised at all.

small for reits? don't think so.. metropolis worth 1bil and london asset worth like 400mil.. their investment properties in the balance sheet stand at 1.9bil..

[vested]

took a stroll at the Metropolis, looks very good, quite a number of patrons in the F&B even during weekends, close to MRT, seems like a nice place to work. buona vista area really getting quite busy these days.

however, tenant directory of Tower 2 looks quite empty for now, from news from before, P&G seems to be moving in when their Novena lease ends by mid 2015 - 2016, to take up 210,000sqft.

now i wonder when will we see the revenue stream from the Metropolis mature - from the looks of it, minimum we might need to wait until end 2015, seems quite far away.

Any experienced VB can help answer: considering the pre-lease agreements signed in Q1'13, towers mostly open for business by end 2013, but this tenant likely move-in date mid 2015 (in P&G's case), when will we see them starting to contribute to the rental income?

(vested)

[greengiraffe]

Good detective work or sour grapes?

http://www.tremeritus.com/2014/08/10/top...go-before/

Top NDay Award recipient censured by AGO before...

[greengiraffe]

http://www.businesstimes.com.sg/premium/...n-20140812

PUBLISHED AUGUST 12, 2014
Ho Bee Q2 earnings down 53% on absence of disposal gain

It posts solid rental income from investment properties
BYKALPANA RASHIWALA
kalpana@sph.com.sg @KalpanaBT

The Metropolis: Currently, about 95 per cent of its 1.08 million sq ft net lettable area has been leased. - BT FILE PHOTO
HO BEE Land's second- quarter net profit dived 53.5 per cent year-on-year to S$12.20 million. But behind the headline numbers, its transformation into a group with a substantial investment property portfolio providing recurring-income ballast is starting to show in its latest report card.
Rental from the group's industrial and commercial properties jumped to S$25.7 million in Q2 ended June 30, from S$2.8 million in Q2 2013 - mainly from rentals of office buildings ie, The Metropolis in Buona Vista, Singapore and Rose Court and 1 St Martin's Le Grand, both in London.
Ho Bee completed developing The Metropolis last year. It also bought Rose Court last year, followed by 1 St Martin's Le Grand this year. Ho Bee's Q2 results do not include rental income from about 70,000 sq ft at The Metropolis leased to GE as the MNC took over the space only in Q3 this year. Currently about 95 per cent of The Metropolis' 1.08 million sq ft net lettable area has been leased. When fully let, rental income from the asset is expected to stablise at about S$80 million gross a year; analysts estimate the net rental income at about S$50 milion.
The two London office buildings are fully leased, generating around £14 million (S$29 million) net rental income annually. The group's chairman and CEO Chua Thian Poh said: "With the completion of The Metropolis and the strategic acquisitions of Rose Court and 1 St Martin's Le Grand in London, the group now has a substantial stream of investment income that would underpin earnings in the years to come."

[greengiraffe]

Ho Bee's recurring income strategy pays off
Q3 net profit shoots up 83.7% to S$13.45m as turnover surges 64.8% to S$26.82m

BT_20141114_KRHOBEE14_1366744.jpg 60 St Martin's Lane in Covent Garden, London, was recently bought by Ho Bee for £43.9m
14 Nov5:50 AM
Singapore

HO Bee Land's strategy of building a strong recurring income base has borne fruit as seen in its third-quarter financial report card.

Net earnings rose 83.7 per cent to S$13.45 million for the three months ended Sept 30, 2014, from S$7.33 million in the same year-ago

[vested]

good to see the small run up in recent days.

looking at the financial report - cash has been exhausted with recent acquisitions, and debt has also increased significantly, more acquisitions are unlikely unless more funds are raised.

i would venture a guess that it seems there could be 2 potential outcomes if Mr Chua would continue the strategy to build a recurrent income stream with more acquisitions:

1) if Mr Chua intends to keep his listing, he could realise the value of investment properties in a REIT to release cash for more acquisitions, the share price uplift will also allow him to sell equity to raise more cash if needed

2) if Mr Chua is looking to privatize, it would be prudent for him to privatize the company first on the cheap, before spinning off the investment properties in a REIT to realise the full value for himself for more acquisitions or projects.

either way, looks like a good problem to have - good to have more than 1 catalyst possible for value to be realised.

of course, it could be possible that he could take a break from growing / acquisition for a period, which would be the worst outcome for us shareholders, and turn into a value trap.

any thoughts?