Mr Patan Somburanasin, Managing Director of Strategic Property Investors Co. Ltd., which manages SHREIT, said SHREIT is paying distributions of 0.2561 baht per unit to unitholders after announcing its third quarter performance that saw a profit of 79.44 million baht. This is a big jump of 144% on the previous quarter. It has set the Book Closing Date for 19 December 2018 and pay out date on 28 December 2018.
If the distribution payments from the operations of SHREIT in Q1 and Q2 of 2018 are included, the total remuneration will amount to 0.3436 baht per unit. Investors who hold SHREIT units from its first day of trading in the Stock Exchange of Thailand will get a total return on investment, for the first 10 months ending in October 2018, of 0.5997 baht per unit. This makes SHREIT one of the highest yielding REITs in the Thai stock market.
This exceptional performance by SHREIT came from the quality of its existing portfolio: 1) Pullman Jakarta Central Park, a 5-star 317-room hotel in Jakarta, Indonesia; 2) Capri by Fraser, a 4-star 175-room hotel in Ho Chi Minh City, Vietnam; and 3) IBIS Saigon South, a 3-star 140-room hotel in Ho Chi Minh city, Vietnam. These hotels are in countries with rapidly growing economies and a buoyant tourism industry. They are in locations with strong potential and enjoy high popularity with tourists and business travelers, both domestic and foreign. In addition, the three hotels target different client segments since they range from 3 to 5 stars. This spreads the risk of income fluctuation due to the wide spectrum of target client groups and allows the trust to pursue revenue growth from guest stay and other incomes in a secure manner.
The Managing Director of Strategic Property Investors said that at present the Securities and Exchange Commission (SEC) is considering SHREIT's request to increase its trust by up to 415 million units and to seek loans of up to US$67.5 million (about 2,363 million baht) for additional investments in two other hotels in Asia:
1) Investment in long leasehold of the Sofitel Bali Nusa Dua Beach Resort on Bali Island, Indonesia, which is a 5-star 398-room hotel with 17 villas. The hotel is ideally equipped for large scale international conferences such as those of the Asia-Pacific Economic Cooperation (APEC – hosted in December 2013) and the International Monetary Fund (IMF – hosted in October 2018).
2) Investment in freehold property comprising the Hilton Garden Inn Kuala Lumpur in Kuala Lumpur, Malaysia, which is located in Chow Kit district close to the Kuala Lumpur City Centre (KLCC), the central business and tourist area. The hotel has 532 rooms and is a 4-star hotel under the management of the Hilton group. It is the only international brand hotel in the area which is under-served by international brands and, thus, offers good potential for continuous growth to SHREIT with limited competition.
Mr James Lim, Executive Director of Strategic Property Investors Co. Ltd., concludes "after the additional investments are made, SHREIT expects to have total assets of over 10 billion baht making it the largest trust among REITs that invest in hospitality currently registered with the Stock Exchange of Thailand. We expect that the enlarged size will create more benefits for unitholders on an ongoing basis, including enhanced liquidity and a reduction in overall cost of capital,"