Tuesday, June 30, 2015

Upcoming IPO - Manulife US Reit

If everything goes well, the first ever pure-play US office REIT - Manulife US Reit, will start trading in SGX from 2pm on 15th July 2015. Yesterday, the preliminary prospectus has been lodged with MAS for the $629.2 million IPO. 

Basing on the initial report, the targeted IPO price is $0.82 and following are some of the key details :

1. The initial portfolio of Manulife US Reit will comprises of 3 US office properties with an aggregate net lettable area of about 1.46 million sq ft, they are :
a. 12-story Class A office building a few blocks from the White House in Washington DC
b. 35-story Class A office building in South Park district of Downtown Los Angeles
c. 19-story office building in Irvine, Orange County, within the Greater Los Angeles market

2. It plans to grow its portfolio through acquisition from third parties and the proceeds from the IPO will be used mainly for this purpose. 

3. The portfolio consists of 83 diversified "high-quality tenants", including TCW, Hyundai Capital America, LA Fitness and Davis Wright Tremaine. 

4. Standard & Poor;s Ratings Services has assigned a "BB" preliminary long-term corporate credit rating to Manulife US Reit

5. It plans to offer an estimated 6.3% dividend yield for 2016 in the offering.

6. Weighted average lease expiry of the properties is said to be 5.1 years while occupancy stands at 97.7% with 83 tenants in total. The properties’ top 10 tenants are said to account for 58% of income while rental escalations of between 2% and 3.5% are said to have been built-in for 83% of the leases.

7. Cornerstone investors, who are to take up as much as 30 per cent of the total deal size, include:
a. Sovereign wealth fund Oman Investment Fund
b. Nikko Asset Management and 
c. Malaysia's Fortress Capital Asset Management

I am still waiting to invest in my first REITs and will definitely find out more about this upcoming IPO once its prospectus is out (assuming it is gotten the approval).

Basing on the above brief details, would you be interested too? ;-)


  1. Hi Richard

    I am interested to find out more and maybe nibble a little. The major deterrence is that I have never been to US personally.

    1. Hi Frugal Daddy,

      Noted. Will share more with you if I've gotten more details.

      I've been to US once but I guess it doesn't make any difference in our investing decision, not unless we are there to purposely evaluate their offices lol

    2. Haha, at least you know how the air smells like :)

    3. Hahahaha! It smells the same lar! Lol

  2. Maybe you can ask Mr IPO to do an analysis on it. Haha

    1. Lazy Cat : I am sure it will be in his/her radar! Just wait for him/her... ;-)

  3. Any idea if income would be subjected to withholding tax?

    1. Since it will be issued in SGX, don't think there will be with-holding tax


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