Oxley Holdings

[tonylim]

The deposit from the potential buyer is refundable , the buyer can just walk away if they want .

[cyclone]

Termination of Letter of Intent for Sale of Mercure and Novotel Hotels at 28 and 30 Stevens Road

The Board announced that as, amongst others, the subsequent deposit of S$38.0 million (being 4% of the Consideration) was not made by the Purchaser in accordance with the terms of the LOI or on such other dates it was due, Oxley Gem has, today, notified the Purchaser that, inter alia, the LOI is terminated with immediate effect on the account of a material and/or repudiatory breach of the LOI by the Purchaser. Pursuant to the terms of the LOI, an initial deposit of S$9.5 million was made by the Purchaser to Oxley Gem. The Purchaser had provided a notice for, inter alia, a refund of such initial deposit. As mentioned in the 10 Jan 2019 Announcement, pursuant to the terms of the LOI, such initial deposit is non-refundable save upon the occurrence of certain specified events under the LOI. Oxley Gem reserves its rights to take all steps necessary to protect its interest.

More details in :
1. https://links.sgx.com/FileOpen/OxleyGEM%...eID=547883
2. http://infopub.sgx.com/FileOpen/Annc%20-...eID=540141

[Shiyi]

Termination of Letter of Intent for Sale of Mercure and Novotel Hotels at 28 and 30 Stevens Road

The Board announced that as, amongst others, the subsequent deposit of S$38.0 million (being 4% of the Consideration) was not made by the Purchaser in accordance with the terms of the LOI or on such other dates it was due, Oxley Gem has, today, notified the Purchaser that, inter alia, the LOI is terminated with immediate effect on the account of a material and/or repudiatory breach of the LOI by the Purchaser. Pursuant to the terms of the LOI, an initial deposit of S$9.5 million was made by the Purchaser to Oxley Gem. The Purchaser had provided a notice for, inter alia, a refund of such initial deposit. As mentioned in the 10 Jan 2019 Announcement, pursuant to the terms of the LOI, such initial deposit is non-refundable save upon the occurrence of certain specified events under the LOI. Oxley Gem reserves its rights to take all steps necessary to protect its interest.

More details in :
1. https://links.sgx.com/FileOpen/OxleyGEM%...eID=547883
2. http://infopub.sgx.com/FileOpen/Annc%20-...eID=540141

[Shiyi]

The deal, which is $1.2 million per key, is too good to be true.
Likewise, the deal of Chevron House. We shall wait and see how it evolves.

[wonghw12]

The deal, which is $1.2 million per key, is too good to be true.
Likewise, the deal of Chevron House. We shall wait and see how it evolves.

Why are the deals too good to be true?

[CY09]

Hi Shiyi,

You will need to back up claims by using market comparable to determine if the offer is indeed too good to be true. For example, you can say that XXX company is buying the property at $5 psf when a similar property of the same lease in the same area was sold two months ago for $3 psf.

Evidence is needed to support claims, especially in a forum like valuebuddies.

Once or twice saying without claims is tolerable, but please avoid doing it multiple times because it undermines credibility.

Thanks

[Shiyi]

Chevron House was bought from German fund for $660 million and to be sold to US Fund at $1.025 billion within a year.
Either German fund sold it too cheap and US Fund overpays. In either case, I find it incredible.

Given the high gearing of Oxley, I would err on the side of caution. Let the market talk. I hope I'm wrong as I'm vested.

[wonghw12]

Chevron House was bought from German fund for $660 million and to be sold to US Fund at $1.025 billion within a year.
Either German fund sold it too cheap and US Fund overpays. In either case, I find it incredible.

Given the high gearing of Oxley, I would err on the side of caution.  Let the market talk. I hope I'm wrong as I'm vested.

I think the US Fund didn't sell it too cheap. They simply didn't push the property to the max potential in rental rate and floor space.

I spoke to several Chevron House retail tenants. Apparently Oxley is asking near double the rents; they rather move out instead. No more cheap dabao food going forward. Higher rents also goes for the office tenants.

On floor space, at the expense of $100mn AEI, Oxley intends to increase NLA from 24,273 sqm to 32,909 sqm (+35%).

Going from $660m to $1.025bn seems like an incredible 55.3% increase. However, 35% can be explained by NLA, and I presume the remainder 20.3% can be more than explained by rental increase. This has yet to factor cap rate compression - you can observe 10bps y/y compression in CCT's portfolio.

[AQ.]

Chevron House was bought from German fund for $660 million and to be sold to US Fund at $1.025 billion within a year.
Either German fund sold it too cheap and US Fund overpays. In either case, I find it incredible.

Buyer is reportedly AEW who didnt find it expensive to buy 55 Market St from FCOT @ implied yields of just 1.6% (>900yr lease) and 20 Anson from CCT @ 2.7% yields (balance 88yrs).
I find the purchase prices expensive but AEW reportedly closed another 1bio USD fund commitment so beauty is in the eye of the beholder (esp if u r cashed up)

[jenson]

I think Oxley is very responsive to news and i dont think our market really speaks the truth for high hearing company like Oxley. The sales of 2 hotels called off doesn't really spell bad news for Oxley, as those two are profit generating assets. Oxley can take their time to get new buyers which they already did, they engaged property agents to jointly promote and sell these 2 assets for Oxley.