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SINGAPORE: Amara Holdings Ltd, a Singapore- based hotel operator, may sell hospitality assets as a real estate investment trust (REIT).
A “REIT has always been one of the options that one can consider to go asset-light”, the company said in an emailed response to questions from Bloomberg News. “There are no concrete plans at the moment and we are continuously evaluating all options including the feasibility of launching a hospitality REIT.”
Amara, led by CEO Albert Teo, is considering putting its 27-year-old Amara Singapore Hotel, along with the adjacent 100 AM shopping mall and Amara Sanctuary Resort Sentosa into a a REIT and selling the assets in an IPO, according to a person with knowledge of the matter.
The IPO could take place next year, the person said. Amara declined to comment on any IPO plan.
Fraser & Neave Ltd, the Singapore real estate developer controlled by Thailand’s richest man, said last month it was considering a hospitality trust. It has received proposals from investment banks in relation to a trust IPO, though considerations are at a preliminary stage.
Ascendas Hospitality Trust, Far East Hospitality Trust and OUE Hospitality Trust are among companies that have seized on Singapore’s expanding market for trust IPOs to raise money by selling hotel assets.
Shares of Amara have risen 15% this year, giving it a market capitalisation of S$303 million (RM784.8 million). — Bloomberg
This article first appeared in The Edge Financial Daily, on September 10, 2013.
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