CapitaLand   

Sentosa IR

Capland looks tire, no strength to climb.

Its growth for the last few years is on disposal of assets and listing into reits. Its fundamentals are over stretched... be careful.

 

Hi rickytan,



I doubt the Kerzner news will have any effect. Capitaland is still going ahead. But news of China Retail REIT is positive.



CapitaLand has 30 shopping malls with a combined floor area of 16 mln square feet in 25 Chinese cities.

 

I think Capitaland is on a technical downtrend now.

 

Hi Nostramudus,  do you think this piece of news will have negative impact on Capitaland share price please ?

 

"CapitaLand, together with Kerzner International, is fully committed to continuing its bid for the integrated resort on Sentosa," CapitaLand president and chief executive Liew Mun Leong said in written statement.

 

Howard "Butch" Kerzner, chief executive of hotel and casino operator Kerzner International Holdings Ltd., was killed on Wednesday in a helicopter crash in the Dominican Republic.



Kerzner was surveying potential development sites for his company when the helicopter went down near the resort of Puerto Plata. He died along with two pilots and another passenger, the company said in a written statement.



Kerzner, 42, and his father, chairman Sol Kerzner, recently led a US$3.2b buyout of their company, which operates Atlantis Paradise Island, a casino resort in the Bahamas, and the One&Only luxury hotel chain.



Kerzner has partnered with CapitaLand to bid for a license to develop a casino resort on Sentosa.

 

It plans to raise about US$200m by spinning of a REIT of Chinese shopping centres before the end of the year, a banking source said. The source told Reuters the listing on SGX would raise "roughly" $320m($201.5m), but would give no further details.


It has spent a couple of years accumulating shopping malls in China, a much sought-after market among global property investors keen on its climbing rents, capital values and soaring retail sales.



CapitaLand said in June that its Chinese retail REIT would have total assets of over $800m, suggesting that the trust might be leveraged by debt to a level approaching the limit of 65% of assets allowed by Singapore authorities.



CapitaMall Trust will also be offered up to 20% of the Chinese REIT in the pre-listing stage.



In early 2005, CapitaLand entered an agreement with China's state-owned Shenzhen International Trust & Investment Co. Ltd. to build 21 shopping centres in China with an option for a further 14, anchored by U.S. retail giant Wal-Mart Stores Inc. .



International property investors are eager for exposure to Chinese shopping centres at a time when retail sales are growing at around 14% annually. Last year, a US$230m Hong Kong IPO by GZI REIT of shopping centres in the southern Chinese city of Guangzhou, drew orders of more than US$28b.



But Chinese REITs are difficult to create because of the high taxes involved in transferring Chinese properties into off-shore companies, which are needed to ensure rental income can be packaged regularly into shareholder dividends. JPMorgan is underwriting CapitaLand's China mall REIT.

 

Save your money to subscribe to Capitaland's China REIT to be launched by year end. Very, very hot, this one ....

 

It sees growth in the domestic housing market broadening, with demand for some of its mid-range condominiums rising, suggesting that the growth in the market may be sustained in the next few years, CapitaLand Residential Singapore CEO Patricia Chia said.



In an interview with XFN-Asia this week, Chia said demand for housing was finally trickling down into the middle section of the market, with two of CapitaLand's developments in this category seeing strong demand.



"The mid-end will have a very good chance of going up, anything between 5-10% -- even 15% -- next year," Chia said.



This is a good indication that demand for residential property, which has been confined largely to the high end of the market for the past two years, will be sustained, she said.



Apartments in CapitaLand's Varsity Park and Citylights, two mid-range 99-year leasehold developments here, which went on sale by two years ago, are selling very well now, Chia said.



Of the 530 units in Varsity Park, 90% have been sold, with the last few units selling at $510-520 per square foot, up from the $450 per square foot selling price when they went on the market in 2004.



CapitaLand has also sold 350 of the 600 units in its City Lights condominium for as much as $700 per square foot. So far, about 390 units have been put on the market and CapitaLand is planning to sell the units on the higher floors of the 52-story development at higher prices.



Encouraged by the demand for mid-range properties, CapitaLand is planning to start selling soon apartments in the 380-unit The Metropolitan condominium. CapitaLand will announce the prices in due course.



Chia said continuing demand for high-end property would ensure that demand for mid-range and even low-end residences would pick up in the months ahead.



Most of the units in CapitaLand's high-end developments in District Nine are fully sold and those in its latest project, Scotts High Park, which were put up for sale in August at an average price of $1,800 per square foot, are also selling well.



"The market is very bullish for a couple of reasons," Chia said. One reason is the government's drive to rejuvenate the Orchard Road shopping belt and develop two casino resorts, she said.



Chia said the casino resorts "are going to generate a lot of economic spillover".



The government's effort to woo foreign talent to live and work here is also helping to fuel demand, she said. "The government is talking about immigration policy that is going to grow our population to 6m [in five years time]. If that's the case, they need houses," Chia said.



"There is another very important factor, in my opinion. Increasingly, the expatriates are finding that Hong Kong's living environment is highly undesirable for their family because its highly polluted," Chia said.



Chia also said international banks were moving their regional operations here because of logistics considerations, especially since they increasingly needed to cover India.



CapitaLand has enough land to cover future housing demand because its land bank's potential gross floor area is about 2m square feet, 80% of which would be on freehold land.



Chia said that while CapitaLand's land bank is sufficient for another two years of developments, the company is looking to replenish its land bank gradually.

 

It is lower after announcing plans to issue $500m worth of convertible bonds to refinance existing debt. The property developer said the bonds can be converted anytime between Dec 26, 2006 and Nov 5, 2016 at $7.3136 per share, which is at a 43% premium over CapitaLand's current share price.



"In financial terms, the impact on CapitaLand is marginal, mainly because of the large premium of the bond price to the last traded share price. Net tangible asset per share will likely rise from $2.33 to $2.35 after issue of bonds but before conversion while gearing will fall from 0.55x to 0.54," OCBC Securities said in a note to clients.



OCBC rates Capitaland a "hold'.

 

Heavy Buy-up at $5.25.

 

CIMB-GK said it has raised its target price to $5.68 from $5.36, on the assumption of higher selling prices for the property developer's high-end residential developments and higher fair value for CapitaLand's listed units.



The brokerage said that the target price was pegged at a 20% premium to the stock's revised net asset value (RNAV), which was raised to $4.74 from $4.46.



"(We) maintain an outperform call on the back of CapitaLand's leadership position in the property fund management business, its focus on capital recycling and its continued expansion in high-growth markets," CIMB-GK said in a client note.



It noted that the consortium of CapitaLand and Kerzner will likely come out with a competitive bid for the Sentosa integrated resort and casino.



"Kerzner/CapitaLand's 60:40 JV plans to invest US$1.5-2b on the project and we estimate an attributable gain of $1.4b, or $0.49 per share for CapitaLand," it said.

 

LONDON (MarketWatch) -- Harrah's Entertainment is reportedly in talks to be bought by a group of private-equity firms in what could be one of the biggest leveraged buyout deals ever, according to a published report on Monday.

Harrah's Entertainment is close to being bought by a group that includes Texas Pacific Group and Colony Capital, according to a report in The Wall Street Journal, which cited unnamed people familiar with the deal.

A deal for Harrah's would vault it in the ranks of top private-equity deals, as Harrah's has a market capitalization of over $12 billion and another $10 billion in debt, the Journal reported.

Hospital operator HCA in July agreed to be bought in a deal that including assumed debt was worth around $33 billion.

A deal for Harrah's also would represent private-equity's first major foray into the gambling sector, as only Colony Capital has significant investments in the industry.

Harrah's in August made its own deal, agreeing London Clubs International for $530 million.

Shares of Harrah's on Friday rose 57 cents to $66.43.

 

More like profit taking.

 

Hey... how come Capitaland fall so much today? Is it because of worries on the upcoming IR bid?

 

Southeast Asia's biggest property group, rose on market talk that the company may announce placement of its shares at a premium to last Friday's closing price.



Dealers said that CapitaLand may issue shares at $5.00-$5.20 a piece -- or a premium to Friday's closing price.



"Typically, before a share placement happens, the price will go up," said a dealer with a local brokerage.



But CapitaLand in a statement received by Reuters denied that it was in the process of a share placement.

 

May double investments in China in the next 5 years. It intends to sell shares in a Chinese reit by year-end. Called China Retail Reit, it's estimated at > $800m.



There was speculation that it could link with Disney to build a theme park here.



Doubt it'll happen. Better to bundle the theme park with the IR.

 

Capitaland on a strong uptrend now. Most indicators pointing North.

 

As a whole Capitaland is still under value.  I would think that the price will move up to about $5, even if it does not win the second IR project.  The company gave good DIV and have many projects in Singapore and China. 

 

Capitaland's price has been steadily increasing for the past 1.5 months now. Is it because of the upcoming Sentosa IR bid?