2nd Chance Properties

[Nick]

This is a relatively small and thinly-traded company with a market capitalization of around $100 million. It deals primarily in Malay clothing in Singapore and Malaysia and it sells gold. It also invest in properties for recurring rental income - mainly retail units and listed REITs. It has generated stable cash-flow over the years.

Its corporate website - http://www.secondchance.com.sg/secondcvd/

I find this company interesting because it has increased its dividends for 6 consecutive years ! Its last dividend payout amounted to 3.8 cents which translates to a 10% yield based on the last traded price.

(Not Vested)
Disclaimer: Do your own research. I am just sharing my views.

[pianist]

which reits does it hold?

[Nick]

It doesn't say.

It has invested $30.7 million in two listed REITs. I believe it invested in the old MI-REIT at $0.24 and it subsequently participated in the rights issue prior its transformation to AIMS AMP REIT. I am not too certain what the other REIT is. Ironically, it has a higher yield than its listed REITs despite having a much lower payout ratio and a better dividend record !

[Blackjack]

I used to hold this. What I recall is that back then, the management acknowledged they would focus on their core businesses and slowly divest their REIT holdings if there is a chance. Management succession is another issue. CEO mentioned he would sell the company if the price is reasonable.

Personally I think the increasing dividends is unsustainable.

[Nick]

The Company uploaded a featured article from SharesInv about its future prospects. Good details about their 4 core businesses - Malay Apparels, Gold, Property Leasing and local securities investment.

http://info.sgx.com/webcoranncatth.nsf/V...E00390F67/$file/2C-Shares_Investment-feature.pdf?openelement

I also stumbled on a 11 page DMG report on the Company dated May 2010:
http://docs.google.com/viewer?a=v&q=cach...Yy47jvAJmA

(Not Vested)

[Nick]

I am mightily impressed that the Management has taken pains to address the common questions that pops up in their AGM meetings in a very detailed manner. Today, the Company released the first set of FAQs and they make a good set of reading for any investor seeking knowledge on either the company or the retail/property leasing business in Singapore.

http://info.sgx.com/webcoranncatth.nsf/V...00032CD3A/$file/2C-20110106-News_Rel-Frequent_asked_Qn.pdf?openelement

(Not Vested)

[namaste]

With residential properties at an all time high and commerical properties expected to do well this year, I see the possibility of companies unlocking their value to properties held.

2nd Chance Properties come to mind due to the buzz surrounding Paya Lebar area due to the following announcemnts.

(1) Enbloc of Lion City Hotel, Hollywood Theatre sites ( http://www.valuebuddies.com/thread-362.html )

(2) URA launches tender for the first sale site in Paya Lebar Central
http://www.ura.gov.sg/pr/text/2011/pr11-12.html

The redevelopment of Paya Lebar area will be positive for properties and business in the surrounding.

2nd Chance’s properties has approx ~10,139 sq ft at City
Plaza. Initially, rental rates are likely to increase as demand for commercial space in that area rises due to more traffic as more business re-locate to this area (which is 4-5 MRT stops to Raffles Place/City Hall).

Afterwhich, valuations of properties is also likely to rise. Finally, as a bonus enbloc of City Plaza (i don't know enough if it make sense to enbloc this- those knowledgable please jump in)

[namaste]

This is slightly dated new that i was not aware when i made the earlier post.

UOL wins coveted Lion City Hotel site

It tops 6-way race with $313m bid and will tap area's growth potential

By Esther Teo


THE race to redevelop the landmark Lion City Hotel and the adjoining Hollywood Theatre site has ended with UOL Group clinching the coveted site near Paya Lebar MRT station for $313 million.

The property firm emerged tops in a six-way tussle that saw 'strong interest from major developers', joint marketing agents Knight Frank and Landmark Property Advisers said yesterday.

The freehold site - with a land area of 13,741 sq m - can be redeveloped into either a mixed residential and commercial complex or a residential development with a commercial element on its first storey, the joint agents said.

Inclusive of the development charge for re-zoning and a 10 per cent balcony allocation, the former redevelopment option works out to $761 per sq ft (psf) per plot ratio (ppr) while the latter will cost $834 psf ppr - inclusive of an additional plot of state land.

UOL chief operating officer Liam Wee Sin told The Straits Times that the freehold status will allow the firm to see the site as a 'mid- to longer-term property play'. He added that the group has yet to finalise plans for the site as it is assessing its various redevelopment options.

The deal, however, will allow UOL to tap the growth potential of the Paya Lebar area, which has been earmarked by the Government to be developed into a key commercial hub outside the central business district, Mr Liam said.

UOL also said in a statement yesterday that the acquisition will allow it to replenish its land bank here.

This comes after the launch of the 351-unit Spottiswoode Residences - the last of its residential land bank here - in November. As at the end of last month, only 68 units remained unsold.

In fact, UOL has already sold more than 1,200 homes in three residential launches last year - Terrene at Bukit Timah, Waterbank@Dakota and Spottiswoode Residences.

This is also the first land parcel the firm has acquired since the Dakota site through a government land tender in September 2009.

UOL Group said in a statement yesterday that the acquisition and redevelopment of the property will be financed by bank borrowings and internal resources.

Mr Colin Tan, research and consultancy director of Chesterton Suntec International, said that the top bid, which came in above the indicative price of $300 million, suggested that the market was still proving resilient despite the property cooling measures introduced last week.

There was still ample liquidity in the market with the economy going strong, he added.

'The site also comes with the flexibility of various mixed-use redevelopment options, which might allow developers to spread out their risk across various segments... It is also one of the districts that the Government is committed to developing,' Mr Tan said.

esthert@sph.com.sg

[Nick]

DMG wrote a comprehensive analyst report on Second Chance Properties in the middle of 2010. It covered some aspects on the developments in the Paya Lebar area which may impact 2nd Chance positively in the coming years.

http://mail.dmg.com.sg/dmgnew/dmgrshnew....800172aa0/$FILE/ATTRG1UZ

[Nick]

1H 2011 Highlights

• 30% Increase in Net Profit after Tax to $8.88 million
• Proposed Bonus Issue
• No. 15 to 18 of 22 Questions & Answers

http://info.sgx.com/webcoranncatth.nsf/V...4003DE041/$file/2C-20110211-Press_Release.pdf?openelement [Press Release]

http://info.sgx.com/webcoranncatth.nsf/V...4003B6338/$file/2C-FY2011-Q2-Results-Final.pdf?openelement [SGX Announcement]

A very credible set of results from the Group. If they can continue this form, the usual 4 cent dividend should be declared in 6 months time. However, they do have quite a number of outstanding warrants whose conversion will lead to dilution (and a substantial increase in the Group's cash).

Their Q&A bit is pretty informative to any prospective shareholder.

(Not Vested)