TeckWah

[BlueKelah]

Maybe no where else to park his spare cash
Only a small increase from 14 to 15% anyway....

[smallcaps]

http://news.asiaone.com/News/Latest%2BNe...37698.html

By Rachael Boon
The Straits Times
Thursday, Jul 18, 2013
Mention the idea of working in an industrial estate to job seekers and many would envision colourless, nondescript factories where kopitiams are the only lunch places available.

But the new 15ha iPark at the mature industrial estate in Paya Lebar - with its glistening glass windows that showcase tenants, and gastronomic and retail offerings from the likes of Din Tai Fung and Charles & Keith - is a far cry from that perception.

That is why the Paya Lebar iPark has seen an influx of young talent keen to work there.

Several well-known local companies have set up their headquarters there - BreadTalk Group is the latest tenant to do so.

The food company opened its $64 million international headquarters last month at the environmentally friendly industrial park, which is positioned as a hub for small and medium-sized enterprises (SMEs) from selected sectors.

The iPark - a pilot project by JTC Corp - aims to attract SMEs from the food and beverage, retail and light manufacturing sectors.

Classified as a Business 2 zone, the area may be used for industry, warehouse, utilities and telecommunication purposes within a prescribed nuisance buffer zone. Certain parcels of land there also have a white site component, so developers have greater flexibility in terms of development options.

A JTC spokesman said the iPark is designed to "foster close interaction and collaboration between the companies, businesses and talents located in the area".

BreadTalk said the park's strategic location across from the Tai Seng MRT station is a big draw.

The group's senior vice-president of brand development, Ms Joyce Koh, 37, said: "Our headquarters can cater to the working crowd here, who want a convenient place where they can dine and entertain even after work."

The headquarters, also known as the BreadTalk Corporate Building, will house the company's retail, research and development, training, logistics and central kitchen facilities.

The ground floor of iPark offers dining options from BreadTalk's major brands such as Din Tai Fung and Toast Box, while the second floor features retail space.

Another established food company anticipated well in advance the buzz that the iPark would generate - Sakae Holdings.

The firm behind Japanese dining chain Sakae Sushi was a pioneer tenant, locating its headquarters at iPark three years ago and naming it Sakae Building.

Chief executive Douglas Foo said the company decided to seize the advantage by moving in early, and that call has paid off.

"It has generated a lot of interest among food and beverage firms, which now want to be located in the area," he said.

Visitors to Sakae and BreadTalk can stroll through wide covered walkways that shield them from the scorching sun and make the structures look more like malls than industrial buildings.

Demand from food and beverage companies has been so high that all four plots set aside for the industry have been fully taken up.

Besides the popular dining establishments, workers can also indulge in retail therapy at iPark, especially when brand-name warehouse sales are held.

Shoe and fashion group Charles & Keith has set up shop at two buildings in the cluster. One is a 50,000 sq ft building on Tai Seng Street built originally in 2006, which also houses high-end online fashion store Reebonz. The second is its headquarters on Tai Seng Link, which occupies a gross floor area of 170,000 sq ft.

Mr Dicky Koh, Charles & Keith's chief financial officer, praised JTC for its vision and for the design of the iPark.

He said: "They had an idea of how the iPark should look, and gave us an idea of how each building would probably look - be it more modern or avant garde."

The multifaceted offerings at the iPark have made it easier for companies such as Charles & Keith to attract more staff to work in the area.

Reebonz co-founder Samuel Lim, 34, agreed and added: "Our staff have a wide range of food choices and we can have business lunch meetings here, which saves us from having to travel out."

Reebonz's move to consolidate its operations at the iPark has led to greater productivity because the presence of logistics companies there has facilitated its supply chain, Mr Lim said.

Unlike most industrial parks, iPark has an ample supply of covered carparks - which include those at the Luxasia Building and BreadTalk's multi-storey carpark.

Come next year, printing and supply chain firm Teckwah Industrial Corp will set up its headquarters at the iPark. The five-storey building, to be called Pixel Red, is under construction and will cost almost $50 million.

iPark is next to the Crescendas Print Media Hub, so the area will be a one-stop service hub for design and printing, said Mrs Angela Kok, Teckwah's director of corporate communication. A vehicular bridge crossing is in the works as well.

SLP International research head Nicholas Mak said 30-year leasehold land in the Tai Seng area garners prices of about $160 to $200 per square foot per plot ratio (psf ppr). Industrial property prices for such land vary from $80 psf ppr for Tuas, for example, to the low hundreds, and usually do not exceed $150 psf ppr, he said.

"Tai Seng might see higher prices as it is near an MRT station and more centrally located."

[dydx]

JTC's latest land tender on a choice 30-year leasehold land plot....
http://www.jtc.gov.sg/Sales-Rental/Gover...221113.pdf
The top bid of $120,078,500 works out to be a unit land cost of $2,694.50 per sq.m. of gross floor area for the proposed mixed industrial/commercial development, based on the land plot area of 12,732.8 sq.m. and the 3.5x max. permissible GPR (Gross Plot Ratio).

Teck Wah has a land plot close by which has a much longer lease term (30 + 29 years).....
http://infopub.sgx.com/FileOpen/1509710_...ileID=3455
and Teck Wah paid a land premium of only $7,735,640 back in 2011. This works out to be a unit land cost of only $341.64 per sq.m of gross floor area for the proposed mixed industrial/office development, based on the land plot area of 9,057 sq.m. and the max. 2.5x permissible GPR.

[dydx]

Just based on its huge advantage in land cost, Teck Wah's proposed mixed industrial/office development (scheduled for completion around Apr2014) at Tai Seng will likely turn out to be a much more profitable project. Upon its completion and based on the current high land valuation in the Tai Seng area alone, the project should have quite a big positive impact on Teck Wah's NAV/share, based on its latest 233.55m outstanding issued shares.....
http://infopub.sgx.com/FileOpen/3rdQ_SGX...eID=263332

[D123]

Just based on its huge advantage in land cost, Teck Wah's proposed mixed industrial/office development (scheduled for completion around Apr2014) at Tai Seng will likely turn out to be a much more profitable project. Upon its completion and based on the current high land valuation in the Tai Seng area alone, the project should have quite a big positive impact on Teck Wah's NAV/share, based on its latest 233.55m outstanding issued shares.....
http://infopub.sgx.com/FileOpen/3rdQ_SGX...eID=263332

The benefit of the Red Pixel building goes beyond gains in property revaluation. The main reason the company is building that plant is because the lease for their main plant at Pandan Crescent will be up in 2014.

This old plant was leased under a sale-and-leaseback scheme from Mapletree many years ago and buying their own property now will save them approximately S$6M - S$6.5M, or S$0.0257 - $0.278 per share per year.

[dydx]

So Teck Wah's Red Pixel project at Tai Seng, when completed next year, has a direct cost (recurrent rental expense) saving proposition. In addition, the project also has a new revenue proposition, as Teck Wah will lease out the excess space for recurrent rental income. Going forward, when the excess space is fully leased out, Red Pixel as a industrial/commercial property asset very near to a MRT station is also a good capital gain proposition, especially through an easy sale to the many hungry REITs.

We mustn't also forget that Teck Wah has already started relocating its more labour-intensive operations to the lower-cost Iskandar area/Johore, and the new own factories in Johore were acquired some 3 years ago at much lower than current prices. So all-in and going forward, Teck Wah's earnings and NAV are poised to show positive development in the next few years.

[dydx]

An extract from the latest news item from Teckwah's website…..
http://www.teckwah.com.sg/news-releases.html

"Topping Out Ceremony for Teckwah's New Print Media Facility PixelRed
3 December 2013

The Board of Directors and Management of Teckwah Industrial Corporation Ltd held a Topping-Out Ceremony to mark the completion of the structure of PixelRed, the new print media facility. The auspicious ceremony was witnessed by more than 70 guests including government agencies, business partners, as well as project teams members who are involved in the building construction project.

Construction works for PixelRed started in August 2012 following a symbolic ground breaking ceremony. PixelRed is poised to be a centre of innovation and technological advancement in delivering emerging and cutting edge print and communication technologies. The building will be ready in March 2014."

[touzi]

So all-in and going forward, Teck Wah's earnings and NAV are poised to show positive development in the next few years.

In the 2012 AR, the Chairman reported that earning is expected to weaken in the next 2 years or more. Perhaps he will be more upbeat in 2013 report.

Our investments in PixelRed, Wuxi, China and the Iskandar Development Zone, will compromise the strength of our earnings to some extent for at
least the next two years, before they are able to generate returns.

[propertyinvestor]

I don't think the buyer is the listed Ho Bee Group. Instead, it is the investment holding company majority owned by Ho Bee chief and it is called Ho Bee Holdings which also owns 70% stake in Ho Bee Group. In other words, the 14% stake in TW is a private investment from Ho Bee chief (and the Holding Company fellow investors) and not the listed Group. Please correct me if I am wrong.

(Not Vested in either)

ic, he must find it undervalued then.... and not because of any synergy with listed Ho Bee's business.

Please take a good look at the face of Chua Thian Poh and the CEO of Of teckwah. Tell me if you notice any similarities

[smallcaps]

I don't think the buyer is the listed Ho Bee Group. Instead, it is the investment holding company majority owned by Ho Bee chief and it is called Ho Bee Holdings which also owns 70% stake in Ho Bee Group. In other words, the 14% stake in TW is a private investment from Ho Bee chief (and the Holding Company fellow investors) and not the listed Group. Please correct me if I am wrong.

(Not Vested in either)

ic, he must find it undervalued then.... and not because of any synergy with listed Ho Bee's business.

Please take a good look at the face of Chua Thian Poh and the CEO of Of teckwah. Tell me if you notice any similarities

Both hokkien? Probably know each other quite well