Portfolio’s strong foundation, 1st year yield offers boost confidence
BANGKOK, Aug 20, 2020 – (ACN Newswire) – The Prospect Logistics and Industrial Leasehold Real Estate Investment Trust (PROSPECT) made a debut on the Stock Exchange of Thailand (SET) today (Aug 20) amid optimism for it being well accepted by investors. PROSPECT invested in the Bangkok Free Trade Zone (BFTZ) which offers outstanding rental rates and strategically located in the industrial and logistics zone that is attracting the movement of production bases from other countries to the ASEAN region. The expected strong response from the investors is primarily driven by the PROSPECT’s attractive 1st year yield of 11.1% or 1.112 baht per unit in the first year of operation.
Vorasit Pokachaiyapat, Chairman of Prospect Development Co., Ltd, which is the developer and operator of BFTZ, said the company is confident in the potential of PROSPECT’s portfolio in terms of financial performance, the economic recovery and relocation of industries from other countries to Southeast Asia should benefit BFTZ, is strategically located on Bangna-Trad Road km.23, near strategic ports, airports and well connected to major roads with transportation linkages between Bangkok and other provinces in all regions.
Aon-Anong Chaithong, Co-Chief Executive Officer of Prospect Management Co.,Ltd, said PROSPECT was listed on the Stock Exchange of Thailand (SET) on August 20, 2020, we expect that in the future the investors will respond as well as the initial offering. “PROSPECT invests in BFTZ, a quality income-producing real estate of Prospect Development Co., Ltd. which is a subsidiary of M.K. Real Estate Development Plc. and Finansa Plc.,” she pointed out.
PROSPECT invested in the sub-leasehold right of parts of land and buildings in the BFTZ which consisting of 63 buildings (183 units), approximately 219,116 Sq.m. of leasable area and approximately 214-1-88.8 Rai of land area from the date of lease registration until 22 December 2039.
BFTZ is an industrial zone for manufacturing & warehousing, strategically located on Bangna-Trad Road km.23, near strategic ports, airports and well connected to major roads with transportation linkages between Bangkok and other provinces in all regions. PROSPECT will invest in the sub-leasehold right of parts of land and buildings which include warehouses and factories in the BFTZ from the date of lease registration until 22 December 2039. And Prospect Development Co., Ltd., who has long experience in developing and managing the BFTZ since 2010 will be appointed as the Property Manager of PROSPECT.
For the year 2017, 2018, 2019 and Q1/2020 the occupancy rate was 89.1%, 96.4% 93.1% and 93.6% (including the Built-to-Suit’s contract started on May 1, 2020). PROSPECT initial investment asset has well diversified tenants profile in terms of industry and nationality. The expected yield of 11.1% or 1.112 baht per unit in the first year of operation is based on pro forma income statement for projection period from October 1, 2020 to September 30, 2021.
Paiboon Nalinthrangkurn, Chief Executive Officer and Director of TISCO Securities Co.,Ltd. which acts as the financial advisor and underwriter for PROSPECT, noted that REITs has increasingly become a popular investment due to the constant dividend payment policy and the opportunity to receive return on the REITs unit price. “So we believe that PROSPECT will be one of the REITs which attract a keen interest from investors mainly for its quality asset and the high occupancy rate,” he concluded.