by winston » Fri Jan 30, 2009 7:23 am
Copied from Suntec Reit thread.
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by ichew on Fri Jan 30, 2009 1:13 am
hi winston
i tot kreit MAY be one tat fits the bill
i understd tat office rentals r affected and MBFC etc r adding much space
but kreit's current avg rental is $7.61 psf pm which is much lower than the reported high of $13-15 psf pm
of cos i will run if ubs, or other banks in ORQ close shop
but i wasnt too happy tat it ex-div more than their declared 5 cents dividend
i mean look at cct
such good support ex-div
also 5cents declared but drop 4cents only
so the lesson i learn here is again liquidity
still i'm holding on to my lots n looking fwd to their nxt div
prayin n hopin tat their full yr div will come up to 10cents
assumin i dont avg dwn, i breakeven in abt 7yrs
my own very crude estimate:
their total NLA = 1,231,692 sq ft
avg $7.61 psf pm
assumin worse case drop to $3.50 psf pm
=> gross rentals per yr of $51m
minus estmated ppty expenses of $13m
minus borrowing costs of 23.58m
minus mgr fees of $13m
plus net tax adjustments of 37.7m
gives 39m or abt 6cents div per sh
kreit has their own Gross Rent sensitivity forecast
can be found in several of their docs
range from plus minus 0.03cents to 0.06cents to their base case
in appendix A2-10 (pg 81 of 118) of the Rights Issue circular dtd 9 APRIL 2008,
they used 0.03cents
let's assume 5% changes in Gross rental will impact DPU by 0.04cents la
so $7.61 to $3.50 => a drop of abt 55%
so DPU will drop by 0.44cents
if DPU is 8cents, then DPU becomes 7.56cents
hmmm frankly it doesnt make sense so i must have got it wrong somewhere
i mean cannot be rentals drop 55% but DPU drop only 0.44cents only right?
anyone who knows pls let me know
issit becos of "Changes in the Gross Rent of uncommitted leases"?
btw pls note that i'm still very much learning abt investing
so take my words with a pinch of salt
i am merely sharing and hoping that more experienced forummers can help guide me
It's all about "how much you made when you were right" & "how little you lost when you were wrong"