First REIT's property in Singapore, Pacific Healthcare nursing home in Bukit Merah (Photo: REITsWeek)First REIT's property in Singapore, Pacific Healthcare nursing home in Bukit Merah (Photo: REITsWeek)

Singapore-listed health care REIT, First REIT, confirmed on 8 July that it will be listing SGD60 million worth of 5.68% subordinated perpetual securities on the Singapore Exchange.

The securities will be listed on 9 a.m. on 11 July and bear the short name and abbreviated name of ‘FirstReit 5.68% PerSec S’ and ‘FIRSTRPS’ respectively.

The securities will be traded and quoted in SGD, and issued in denomination of SGD250,000. These will bear a distribution rate of 5.68% per annum for the first five years.

First REIT first announced in June 2016 that it was listing the securities to diversify its funding sources. “As the securities are an alternative form of capital instrument, the exercise will bring down First REIT’s current gearing of 34.5% to around 30%”, said Ronnie Tan, CEO of the REIT’s manager.

“Proceeds raised from this exercise will strengthen our balance sheet and increase our debt headroom for future yield-accretive acquisitions given the new regulatory gearing limit of 45%”, he added.

First REIT has proposed a joint acquisition with Lippo Malls Indonesia Retail Trust for an integrated development in Yogyakarta. The REIT also has a pipeline of 43 hospitals from its sponsor, PT. Lippo Karawaci Tbk.

Units of First REIT last changed hands on the Singapore Exchange at SGD1.27.

By Ridzwan Rahmat

Ridzwan has been analysing REITs and business trusts since 2008, and personally manages a portfolio comprising mainly of SGX-listed REITs. He founded REITsWeek in 2013.