REIT ASIAPAC
Q
INTERVIEW
How has the Covid-19 pandemic and the UK lockdown
affected Elite’s UK properties, and what are your plans
to mitigate any impact if the shutdown lasts longer
than expected?
provide the REIT with ROFR to purchase.
Jonathan: I think it is a very good opportunity for this REIT to
grow via the ROFR pipeline because the 62 assets are located
across the UK and are long-leased to the UK Government. It is
very much in line with the REIT’s investment strategy.
Shaldine: Despite the UK lockdown resulting from the Covid-19
pandemic, we remain positive about the stability of Elite
Commercial REIT’s portfolio, backed by its uniquely counter-
cyclical tenant – the Department for Work and Pensions, which
provides us with steady cash flow. On that front, we have
received our first three months advance rent since listing, for the
period 1 April 2020 to 30 June 2020 from The Secretary of State
for Housing, Communities and Local Government, in accordance
with the lease agreements. In addition, our income visibility is
enhanced with two of our properties having secured waivers or
extension of the break options. Nevertheless, we are also closely
monitoring the situation, and are holding regular dialogues with
our existing tenants in line with our active tenancy management
strategy.”
Q
Q
Would you consider going beyond the UK, say to other
European countries?
Shaldine: The investment mandate within the prospectus stated
that this REIT will be UK-focused.
Joel: There is sufficient liquid stock available in the UK that
doesn’t warrant going out of the country. It is common for REITs
with assets in Singapore to go abroad because Singapore is too
small, and they need to find other investment stock. I don’t think
we would have the same limitations.
Being the first British-pound denominated REIT in
Singapore, what unique opportunities are you looking
to tap? Similarly, what unique opportunities are in
store for Singaporean investors looking into investing
in your REIT?
Q
Jobscentre Plus at High Road, Ilford
What is your growth strategy in the medium term?
As early as now are you expecting acquisitions (local
or overseas), asset enhancement and redevelopment
down the line after the IPO?
Shaldine: One of the key focus is growth, as we are relatively
small in the Singapore REIT market. We are also looking to tap
into certain indexes to attract even more institutional investors
in the longer term. Jonathan: There are broadly three ways that we’re looking to
grow this REIT. We can look at the traditional route of asset
enhancement, development of any excess land potentially, as well
as growth via acquisitions.
Jonathan: The UK is a huge real estate market. It is the second-
most traded real estate market globally and consistently
outperforms all other European countries in terms of investment
volumes. So that means that there’s a very deep pool of asset
acquisition opportunities. Also, the UK Government, which is
our tenant, is reported to be one of the largest occupiers of real
estate. Since the mid-90s, the UK Government has gone asset-
light, which means that there’s a very deep and liquid market for
real estate assets let to the UK Government. First and foremost, all our properties are leased to the UK
Government, so anything we do on the existing portfolio will
need to be in agreement with the UK Government. There are
clear opportunities that exist, and they are primarily through the
potential to grow the portfolio on the existing land that the REIT
owns, which is more than 47 hectares of land across towns and
cities in the UK.
One asset, which is highlighted in the prospectus, is Peel Park in
Blackpool. It has almost 12 hectares of undeveloped grassland.
The UK Government is actively investing in regenerating
Blackpool. We understand that they have been looking at our
asset as a potential place to grow into a government hub.
We see some good opportunities to acquire assets that are
accretive for the REIT’s dividend profile. We are focused on
accessing assets in the UK market as the main driver for growth.
Shaldine: We do have a ROFR (Right of First Refusal) from the
sponsors, which provides growth opportunities. In the UK, real
estate transactions tend to transact faster than in Asia. The
completion timeline is usually very compact, and ideally, you
would want to have the capital on hand to complete a transaction.
In addition to acquiring assets by the REIT directly, we also have
sponsors that are committed to acquire and hold the assets and
We have had discussions with them about how to bring forward a
proposal to increase the amount of lettable area on our property,
so that will be one of the key growth drivers of the REIT.
There are also opportunities which may come through on a longer
term where asset values could be enhanced. In the UK, there’s a
system called Permitted Development Rights, which means any
Glasgow Benefits Centre, Scotland
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