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Hot stock: Lendlease Global Reit jumps 6.8% on trading debut

UNITS of Lendlease Global Commercial Reit (Lendlease Global Reit) made a stellar debut on the Singapore Exchange’s (SGX) main board on Wednesday afternoon.

Shortly after opening at S$0.935 at 2pm, the counter was trading at S$0.94 as at 2.18pm, which is up six cents or 6.8 per cent from its initial public offering (IPO) price of S$0.88.

Some 26.2 million units had changed hands, making it one of the most heavily traded securities on the Singapore bourse for the day.

Earlier, on Tuesday night, the real estate investment trust’s (Reit) manager said the IPO had ended with the public offer tranche 14.5 times subscribed.

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Lendlease Global Reit had offered 387.5 million units at S$0.88 apiece. Of these, 22.7 million units were offered to the public, and valid applications for 330.4 million units were received. The subscription rate of 14.5 times was the highest for a Singapore Reit (S-Reit) in the last five years, according to the manager.

For the placement tranche, indications of interest were received for 364.7 million units, translating to a subscription rate of 9.9 times, with 13 million reserved units fully allocated.

Separately, but in conjunction with the IPO, 13 cornerstone investors also subscribed for a total of 453.8 million units. These include BlackRock, Fullerton Fund Management Company, Lion Global Investors, Nikko Asset Management Asia, AEW Asia, Principal Asset Management and TMB Asset Management Co.

A total of 1.17 billion units were issued, raising gross proceeds of S$1.03 billion.

Lendlease Global Reit's S$1.4 billion IPO portfolio comprises Orchard Road mall 313@somerset and Grade-A office property, Sky Complex, comprising three office buildings in Milan, Italy.

Its sponsor, Lendlease Corporation Limited, is part of Lendlease Group, a property and infrastructure group with operations in Australia, Asia, Europe and the Americas.

Lendlease Global Reit’s listing brings the total number of SGX-listed Reits and property trusts to 45, with a combined market capitalisation of about S$110 billion, SGX said on Wednesday.

Together with real estate companies, the overall SGX real estate cluster has a combined market capitalisation of over S$190 billion. S-Reits (Singapore Reits) as a sector generated total returns of 22.9 per cent for the eight months ended August 2019, the bourse operator noted.