[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 an international placement tranche of 248.96 million units and a public offering of 13.2 million units – 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, 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 billion.
BT in your inbox
Start and end each day with the latest news stories and analyses delivered straight to your inbox.
The Reit will acquire one more student accommodation in Australia – Epiisod Macquarie Park – following the listing.
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 for 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 purpose-built worker accommodation assets in the initial portfolio have an occupancy rate of 96.9 per cent, while the purpose-built student accommodation assets have an occupancy rate of 96.8 per cent for the three-month period ended Mar 31, 2025.
Average rents for the worker accommodation assets rose at a compound annual growth rate of 26.3 per cent over FY2022 to FY2024. The Reit’s student accommodation assets rose at a compound annual growth rate of 11.3 per cent over the same period.
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.
Centurion said that the enlarged portfolio, which includes the Epiisod Macquarie Park property, is projected to provide distributed per unit yields of 7.47 per cent in FY2026, and 8.11 per cent in FY2027, based on the offering price.
The Reit’s leverage ratio will be about 20.9 per cent at IPO, and around 31 per cent after the acquisition of Epiisod Macquarie Park.
On a pro forma basis, the initial portfolio’s gross revenue is S$161 million, and the net property income is S$113 million in FY2024.
Tony Bin, who was previously the chief executive officer of Centurion Properties, will be the CEO of the Reit manager. He has more than three decades of professional experience across banking and various real estate asset classes.
