SG Realty Dealbook: TEE Land’s associate buys Bangkok land for $3.7m; HPH Trust manager rejects offer to pick 50% stake in Gaolan Phase 2

Ship building industry in Vietnam (visual from related MBT feature)

Singapore-listed property entities are engaging in property transactions abroad with an associated firm of TEE Land  acquiring a Bangkok land parcel. In addition, the manager of HPH Trust has rejected an acquisition offer for 50 per cent stake in a China-based property project.

Associated firm of TEE Land’s acquires Bangkok land parcel for $3.64 million

TEE Land associate, Chewathai Plc, has entered into a sale and purchase agreement (SPA) with vendor Yuree Sethawan to acquire freehold land plot measuring 24,704 square metres at Rangsit Klong 1, Patumthani Province, Bangkok, Thailand, for THB92.6 million (S$3.64 million).

Chewathai intends to develop the new plot into a landed housing project, with the proposed acquisition expected to be completed in early December 2015. The acquisition is part of of a strategy to establish a portfolio of development properties as part of a previously announced listing plan on the Stock Exchange of Thailand’s Market for Alternative Investment.

According to a release, Chewathai will finance the acquisition through a mix of internal funds and bank borrowings. However, this comes amid concerns regarding oversupply and the emergence of a bubble in Bangkok’s housing market.

2015 is expected to close with new projects totalling $13 billion throughout the year. New housing projects in Bangkok have risen in value by 64 per cent year-on-year (YOY) as of first half 2015, according to Reuters.

The deadly Erawan Shrine bombing is expected to weaken already soft demand in the property market.

The bleak prospects have prompted many residential developers to rethink and even scale down their plans for the next four months, normally considered the sector’s high season.

In a Bangkok Post report, it was observed that in the wake of the Erawan Shrine bombing on August 17, 2015, several property developers listed on the Stock Exchange of Thailand have postponed the launch of several projects which were scheduled for this year.

Several developers have reportedly shifted their focus to single-house and townhouse projects due to the low-rise housing segment being less risky than the condominium market. This reflects a shifting of focus towards smaller projects that can have sales closed and construction completed in a shorter interval.

In a statement to the Bangkok Post, Atip Bijanonda, president of the Housing Business Association, said “Developers should be more cautious of new investment, particularly in large projects that take a few years to develop. Maintaining financial liquidity with cash on hand enough for one year amid an uncertain situation is a must, as this year’s fourth quarter may not be a hot time for the sector to boost new residential sales.”

HPH Trust manager rejects offer to acquire 50% stake in Gaolan Phase 2

The trustee-manager of Hutchison Port Holdings (HPH) Trust has declined an acquisition offer from parent firm Hutchison Port Holdings for a 50 per cent equity interest in Zhuhai International Container Terminals (Gaolan Phase 2), also termed the Gaolan joint venture (JV).

The offer was made due to a proposed disposal by HPH of its 50 per cent interest in Gaolan JV,  in compliance with the right of first refusal agreement signed on February 28, 2011 between Hutchison Port Holdings Management, the trustee-manager, and HPH. The Gaolan joint venture (JV) was established to undertake a greenfield development in Gaolan Port Phase II, expected to start operation upon completion of its first berth.

According to HPH, while Gaolan Port is a deepwater port, the investment opportunity is not aligned with the criteria of HPHT in several areas, including the volume trend of foreign cargoes, competition within the Pearl River Delta area and the potential impact of an investment in Gaolan JV on the DPU of HPHT, when accounting for the on-going capital commitment required.

“Accordingly, the Trustee-Manager is of the view that it would not be in the best interests of HPHT and its unitholders to accept the Offer and acquire from HPH its interest in Gaolan JV,” said HPH Management in a release. Notwithstanding this rejection, HPH Trust is still exploring opportunities aligned with their investment criteria.

With inter-port complementarity accounting for a significant share of changes to shipping capacity in the Pearl River Delta and benefiting the supply chain of the region, as well as the Pearl River Delta being a major trade and manufacturing zone, there are still significant market opportunities in the port sector, especially in terms of inland waterway transport.

Also Read: 

SG Realty Dealbook: Perennial acquires 10% in Perennial China Retail; Sabana REIT secures Islamic credit facility; Keppel REIT acquires 3 Melbourne units

SG Realty Dealbook: Yongnam acquires Johor land; Asian Micro considers formation of property arm

SG Realty Dealbook: Saizen REIT acquires residential property; China New Town to collaborate with Shenzhen Venture Capital for property development; P99 Holdings to morph into Indonesian road and port operator in RTO deal

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.