Singapore's 1st REIT Falls 35% after Default

Singaporean REIT’s traded units suffer a punishing loss. The manager of First Real Estate Investment Trust (First REIT) announced a proposed rights issue to raise gross proceeds of around S$158.2 million ($119.1 million), which it said was “critical” for the REIT to m

BY Realty Plus
Published - Tuesday, 29 Dec, 2020

Singapore's 1st REIT Falls 35% after Default

Singaporean REIT’s traded units suffer a punishing loss. The manager of First Real Estate Investment Trust (First REIT) announced a proposed rights issue to raise gross proceeds of around S$158.2 million ($119.1 million), which it said was “critical” for the REIT to meet its debt covenants and avoid an imminent default of 39.8 percent of total debt due on March 1 next year. The REIT’s units sank on the news. . The first Reit currently faces a "significant refinancing hurdle" with around 80.2 per cent, or about $395.7 million, of its debt coming due within the next 18 months, with 39.8 per cent, or about $196.6 million, coming due on March 1 next year. The manager said the viability of the proposed rights issue is dependent on it being able to provide certainty in respect of the valuations and cash flows of First Reit's assets through the proposed restructuring of master lease agreements for the hospitals leased to Lippo Karawaci, announced last month.