High yield a key factor in Soilbuild Reit's privatisation exercise, but will investors accept the deal?

AFTER weeks of watching Lippo Malls Indonesia Retail Trust (LMIRT) and Sabana Shari'ah Compliant Real Estate Investment Trust (Sabana Reit) make headlines for all the wrong reasons, the privatisation offer for Soilbuild Business Space Reit (Soilbuild Reit) announced earlier this week was probably something of a breath of fresh air for many investors.

The deal, which involves Soilbuild Group's executive chairman Lim Chap Huat teaming up with Blackstone Real Estate to acquire the holdings of minority investors, is being done at a seemingly reasonable price of S$0.55 per unit, which is close to Soilbuild Reit's book value.

More importantly, in explaining the rationale for the deal, the manager of Soilbuild Reit displayed a degree of perspicacity that its counterparts at Sabana Reit and LMIR Trust plainly lack.