Brokers' take

Ascott Residence Trust (ART) | Buy (maintained) Target price: S$1.25 Jan 10 close: S$1.11 DBS Equity Research, Jan 10

ART announced the sale of Ascott Raffles Place Singapore for S$353.3 million to Cheong Sim Lam, a private investor whose family developed International Plaza and Hyatt Regency Singapore. We estimate the property was sold on an exit net profit interest yield of around 2 per cent.

With ART having announced earlier its intention to rebalance/optimise its portfolio and with previous market speculation that ART was looking at selling Ascott Raffles Place, we believe this transaction may not surprise some investors, albeit the uncertain timing. We believe the market should react positively to the large capital gain from the disposal as well as management being "unemotional" about its properties and willing to sell them at the right price.