Hiap Hoe

[johnnydash]

A move towards unlocking of value in hiap hoe. Hiap hoe is another neglected stock by the market due to its small free float and lack of analyst coverage.

My own estimate of their RNAV is 1.60-1.80 which compares with a current market price at the 80 cents level. This was done 2-3 years ago and I did not include their developments in Australia. Of note, they invested about 300 million of their capital in Australia, a mix of development and recurring income projects. The bulk of the projects were rental properties with a yield of 7-8%. Given the use of debt, the ROE on income properties is easily 12-15%. Impressive. Their overall market cap is only 300 million, which shows how undervalued they are. The separate listing will definitely make explicit the value of the australia segment.

Looking from another angle, hiap hoe group will get a recurring pretax income of 50 million(conservative estimate) from being an Australian and Singapore landlord. Compared to market cap of 300 million, again very impressive. This will probably show up in their results soon. And they certainly can pay higher dividends while at the same time build up their warchest.

Lets not forget their mixed development project in melbourne with residential units 80% sold and a 7 star hotel as part of the project.

Grossly undervalued + management showing a number of signs of unlocking value; lets see if the market wakes up to the value of this company.


vested

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Hiap Hoe plans to spin off Australian property business on Catalist - Companies News & Top Stories
The Straits Times‎ - 15 hours ago
SINGAPORE - Hiap Hoe has proposed to spin off its Australian property business held under Meteorite (Australia) on the Catalist board.

[opmi]

^^ dump and spinoff out the risky assets. Protect the mothership.

[johnnydash]

^^ dump and spinoff out the risky assets. Protect the mothership.

Hi why do you think the assets are risky?

[opmi]

^^ dump and spinoff out the risky assets. Protect the mothership.

Hi why do you think the assets are risky?

Peakish Australia property market. And some regulatory risks (like CES).

[greengiraffe]

Hiap Hoe drops Aussie spin-off
KYLAR LOUSSIKIAN, BEN WILMOT, FLOATS
445 words
22 Jul 2015
The Australian
AUSTLN
English
© 2015 News Limited. All rights reserved.
Singapore-listed developer Hiap Hoe has reversed plans to separately list its Australian operations on the second-tier Catalist board on Singapore Exchange.

Hiap Hoe, which has built up a $1 billion development pipeline in Melbourne and Perth in the last two years, announced in January it would spin off its Australian ­operations.

The announcement followed similar moves by Aspial Corporation, which is developing the 101-storey Australia 108 tower in Melbourne, and Fragrance Group. The moves appeared to open a new funding stream for Singapore-listed developers that have poured into Australia.

Other listed developers to build a presence include Roxy-­Pacific Holdings and Figtree Holdings, and they are competing for sites against local groups, ­private Asian developers and deep-pocketed Chinese groups.

In a statement to shareholders, Hiap Hoe said: “Having considered various factors, including the current market conditions, commercial considerations and other factors”, it had decided to put a hold to its listing plans.

In January Aspial, headed by billionaire businessman Koh Wee Seng, flagged plans to spin off its Australian and Malaysian property business.

Aspial has a $2.5bn development pipeline in Australia.

Mr Koh’s older brother, Koh Wee Meng, also has plans to carve off his Fragrance Group’s local ­operations on to Singapore’s ­Catalist board.

Hiap Hoe acquired 380 Lonsdale Street in Melbourne in late 2013, paying $43.8 million for the site with plans to develop two ­towers of 51 and 47 storeys on top of a five-­storey podium, with an option to go up to 59 storeys.

Other holdings include 206 Bourke Street, a planned twin-tower complex called Marina Tower in Melbourne’s Docklands, and 130 Stirling Street in Perth’s CBD. The 380 Lonsdale Street twin tower was approved earlier this year by Victoria’s new Planning Minister Richard Wynne, with the $240m development designed by Elenberg Fraser, the same firm that recently unveiled Fragrance Group’s “Beyonce-inspired” design for the Savoy Tavern site on Spencer Street.

A host of Australian property assets already sit with Singapore-listed groups. Frasers Centrepoint swooped on Australand Property Group in a $2.6bn takeover last year.

Frasers has since flagged that it may float a portfolio of Australian industrial properties on the Singapore exchange and its office and hotel funds already hold local ­assets.

The Ascendas Hospitality Trust, St****** Corporation and CDL Hospitality Trusts all own hotel properties across Australia.Singapore entrepreneur Michael Kum has also long mulled plans to float the M&L Hospitality Trust, which owns the Four Points by Sheraton at Darling Harbour, on the Singapore Exchange.


News Ltd.

Document AUSTLN0020150721eb7m0003i

[greengiraffe]

• Sep 23 2015 at 5:31 PM 
   
  
  
•  Updated Sep 23 2015 at 5:31 PM 
  

Hiap Hoe puts 206 Bourke Street back on market

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[Image: 1426319989079.png]

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by Larry Schlesinger
Listed Singaporean developer Hiap Hoe has abandoned plans to build a hotel at 206 Bourke Street in Melbourne's Chinatown precinct and instead put the office and retail property back on the market, with expectations of more than $115 million.
The former Village City Centre, which extends a  city block to Little Bourke Street, was one of three properties Hiap Hoe acquired in the Melbourne central business district and Docklands in August and September 2013, with plans to develop hotels on all three of them.
Hiap Hoe said it had appointed CBRE and Savills to jointly market the freehold property via an expressions of interest exercise closing on November 18.
CBRE director Mark Wizel said Hiap Hoe had added significant value following a strategic leasing campaign that added new tenants including Michelin-starred dim sum restaurant Tim Ho Wan, which will open in November. Existing tenants include G-Star Raw, JB Hi-Fi and the Dragon Boat and Shanghai Dynasty restaurants.

"The property has and will always be underwritten by its significant land value, spanning over 3000 square metres of central CBD land," said Mr Wizel, who is marketing the property alongside CBRE colleagues Josh Rutman, Kiran Pillai and Justin Dowers and Clinton Baxter of Savills.
Hiap Hoe acquired the four-level Bourke Street property for $105 million from private developer Les Smith and Macquarie Group on a yield of more than 7 per cent with a permit – still live – for a 142-room hotel on top.
Given the recent compression in CBD yields – the Mid City Arcade at 194-200 Bourke Street sold to Malaysian-controlled Shakespeare Property Group for $60 million on a yield of less than 5 per cent in May – 206 Bourke Street is expected to sell on a yield of less than 6.5 per cent.



Hiap Hoe's two other September 2013 Melbourne acquisitions were at New Quay in Docklands, where Marina Towers, a mixed-use development comprising a Four Points by Sheraton hotel and two residential towers, is under construction and 380 Lonsdale Street, near Emporium Melbourne, which has approval for a 313-room hotel and more than 400 apartments.

[greengiraffe]

• Nov 29 2015 at 1:53 PM 
   
  

Hiap Hoe sells central Melbourne site for $118.3m

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[img=620x0]http://www.afr.com/content/dam/images/g/l/a/n/d/i/image.related.afrArticleLead.620x350.glanba.png/1448765598175.jpg[/img]Super fund investor ISPT has paid $118.3 million for a five-level, Bourke Street property in central Melbourne.
[Image: 1426320916439.png]

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by Nick Lenaghan
Super fund investor ISPT is boosting its retail exposure in central Melbourne, with the $118.3 million acquisition of a mixed-use property that Singapore's Hiap Hoe bought only two years ago.
The listed Singaporean snapped up the five-level property at 206 Bourke Street for $105 million as one of three acquisitions it made in buying spree in Melbourne in late 2013.
The former Village City Centre, built in 1986, had been converted to retail and office use in 2010 by developers Les Smith and his partners.
Hiap Hoe had its own redevelopment plans, announcing a six-storey hotel addition to rise above the existing retail and office complex. But in September Hiap Hoe abandoned that plan, appointing CBRE's Mark Wizel, Josh Rutman, Kiran Pillai and Justin Dowers, and Savills' Clinton Baxter, Paul Craig and Ben Azar to sell the property.

In an announcement to the Singapore stock exchange, Hiap Hoe said its Australian subsidiary had entered a heads of agreement to sell the Bourke Street property.
ISPT has until December 18 to complete due diligence. The super fund investor has been boosting its retail holdings both through its core fund and a dedicated retail fund.
Last week, it bought The Well ­shopping centre in Melbourne's Camberwell for $72.5 million.
RETAIL LANDMARKS


And in central Melbourne, home to a fast-growing CBD resident population boosted by foreign students, ISPT holds several retail landmarks. They include Midtown Plaza, on Bourke Street near the Hiap Hoe acquisition, and the GPO building on the Bourke Street mall, and The Strand complex, which have both been recently redeveloped.
Mr Wizel said Hiap Hoe had added significant value to the 206 Bourke St property after signing up new tenants such as Michelin-starred dim sum restaurant Tim Ho Wan.
Existing tenants include G-Star Raw, JB Hi-Fi and the Dragon Boat and Shanghai Dynasty restaurants.
"The property has and will always be underwritten by its significant land value, spanning over 3000 square metres of central CBD land," said Mr Wizel when the property went on the market in September.

With close to 12,000 square metres of net lettable area in total, the property has retail space on the first two levels and office space in the three upper levels.

[vested]

Reviewing their 2015 AR again, key sticking point is the huge employee expenses of 20M (2014) to 23M (2015), administrative expenses of 80M (2014) and 69M (2015) - seems disproportionate to the turnover and probably the main reasons making it so difficult to turn a "profit".

Doubt the management will be in a hurry to change the status quo, as they continue to get paid handsomely regardless of the business performance!

[cfa]

Many of their family members are on company payroll , and very generous to themselves.

[Sumeria]

I don't think the high admin/employee expenses are worrying. Going through the annual reports, I find that high employee expenses is probably attributable to the operating of 2 hotels.

As for the high admin fee, it has to do with the takeover of Superbowl (2014) and the high depreciation/revaluation of assets (mainly the 2 hotels, unsold units and perhaps its Australian assets) (2014 and 2015).

Note that depreciation of its hotel assets (and even its other held for investment/sale properties) may not necessarily be a bad thing. It's very much an accounting matter. For eg, as a company charges depreciation for its hotel asset, its carrying value drops but its market value might have risen, hiding bigger and bigger surpluses.

I was more concerned about HH's investment in Ley Choon, but this is mitigated by the "small" (relatively) investment sum which has mostly been written off. I am also not too impressed with HH's marketing and sales records (for its Singapore projects at least) and its dividend policy.

For the above reasons, while I note that the company has a high NAV (and probably higher RNAV) of more than $1.40, I prefer CES and KSH for their dividend payout history and business execution.

Having said that, HH is a potential privatisation candidate, with my expectation that only an approximate $1 offer would break shareholders (many long time ones) from their die hard affair with the company.