It will be the first pure-play purpose-built living accommodation Reit listed on SGX
[SINGAPORE] Mainboard-listed Centurion Corp is spinning off several of its worker accommodation properties into a Singapore-listed real estate investment trust, or S-Reit.
In its initial public offering (IPO) prospectus lodged on Thursday (Sep 11), Centurion said it will offer a total of 262.2 million units, comprising both a placement tranche and a Singapore public offer, at an offer price of S$0.88 per unit.
The manager intends to raise gross proceeds of approximately S$1.5 billion from the offering, and the cornerstone units, the sponsor subscription units and the consideration units.
Following the offering, the new Centurion Accommodation Reit will have 1.7 billion issued units, of which 787.4 million units will be held by Centurion Holdings, the Reit’s sponsor, and 614 million units will be held by the 16 cornerstone investors.
Its cornerstone investors include Amova Asset Management, DBS Bank, Eastspring Investments and Lion Global Investors.
The initial portfolio of Centurion Accommodation Reit will comprise 14 assets, with five purpose-built worker accommodation assets located in Singapore, eight purpose-built student accommodation located in the United Kingdom, and one student accommodation asset located in Australia. The initial portfolio has an aggregate appraised value of approximately S$1.8 million.
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Centurion said that the Reit will be the first pure-play purpose-built living accommodation Reit listed on the Singapore Exchange (SGX). Its initial exposure to the Singapore, UK and Australia markets will benefit from “favourable fundamentals and strong growth outlook driven by robust demand and supply dynamics”.
It noted that there is high demand fo foreign labour in Singapore, providing “favourable fundamentals” for the purpose-built worker accommodation sector in Singapore. There is also robust growth in the purpose-built student accommodation sectors in the UK and Australia due to strong demand for higher education and insufficient supply of accommodation for this segment.
The proceeds raised will go towards partial payment of the initial portfolio, payment of transaction costs related to the acquisition of the initial portfolio, the offering, loan facilities and working capital.
Tony Bin, who has more than three decades of professional experience across banking and various real estate asset classes, will be the chief executive officer of the Reit manager.
