SGX, SISV to review practices and reporting of valuers engaged by listed entities

SINGAPORE Exchange (SGX) and the Singapore Institute of Surveyors and Valuers (SISV) are jointly reviewing valuation practices and the reporting carried out by real estate valuers that are engaged by listed issuers.

A committee has been formed to carry out the review, they said in a joint statement on Thursday.

As investors rely on real estate valuations when making investment decisions in Reits and business trusts, quality valuations are crucial to safeguarding investor interest and maintaining confidence in the cluster.

Of particular interest to investors would be the methodologies and principal assumptions adopted in the valuation reports.

"SGX is committed to collaborating with the entire eco-system to improve governance and disclosure," said Michael Tang, head of listing policy and product admission at SGX.

"We believe investors will benefit when valuation reports contain clearer information on methodology and key assumptions," he added.

The announcement followed SGX's engagement with professionals from the real estate, financial auditing and valuation industry in the past few months to better understand how valuations are done, and how such information is featured in documents such as shareholders' circulars.

SISV president of valuation and general practice Lim Lan Yuan felt that this review is timely.

A key objective of the institute, amid keen competition in recent years, is to enhance the valuation reporting requirements, he said.

The committee tasked for the review comprises representatives from various stakeholder groups, including representatives from SGX and SISV, CapitaLand Singapore's chief investment officer Wong Jen Lai and Mapletree Investment's deputy group CEO Chua Tiow Chye. It will identify and recommend enhancements to the disclosure framework for real estate valuation and reporting in Singapore.