Posted by: donmihaihai | January 30, 2017

Number never lie.

Aim my gun at the best and brightest.

Some say CMT is the best managed REIT around SG. The number suggest well….

CMT listed in 2002 with portfolio of 3 properties namely, Tampines Mall, Junction 8 & Funan IT Mall

IPO  valuation  SGD895M.

Dec 2015 valuation SGD2,299M

Increase in valuation – 157%

NAV per share at IPO – SGD0.97

NAV per share at Dec 2015 – SGD1.86

increase in NAV per share – 92%

157% vs 92%. Management destroyed shareholders/unit holders value.

Dividend per share at 2003 -SGD0.0803

Dividend per share at 2015 – SGD0.1125

increased in dividend per share – 40%

Net property income for 3 malls in 2003 -SGD78.4M

Net property income for 3 malls in 2015 – SGD121.5M

increase in Net property income – 55%

55% vs 40%. Management destroyed shareholders/ unit holders value again.

Some say REIT learned the lesson in 2008. so REITs are creating value since then.

Portfolio value(less property not in the list in 2015) – SGD6,287M

Portfolio value(less property not in the list in 2010) – SGD8,424M

Increased in valuation – 34%

NAV per share at Dec 10 – SGD1.54

NAV per share at Dec 2015 – SGD1.86

increase in NAV per share – 21%

34% vs 21%. Same story.

It is the same for dividend.

The management or external fund manager is the one that benefited.

Some say their yields is high, range from 6% to 10%. Where can you find these yields?

True dividend yields look high, not easy to find stock paying this kind of yields. Unlike REIT, stock usually don’t pay out 100% of earnings. So it is back to same valuation, ROE. Even with revaluation, REIT hardly pass the 10% mark. But those at the upper range start look cheap. Maybe there are reasons behind.

But REIT pay out cash yearly or even quarterly. Cash in hand is worth more than in the hand of management. True. this is attractive. But as above, REITs destroyed unit holders value. It is a small pie and many hands are helping on that pie.

Well REIT is safer than stock and history say so! underlying any REIT, stock is a business. All businesses are risky in natural. REIT traded just like any other stock in SGX.

So what is really different? Hit me a good reason.

I have not look into CMT in details, but will never invest in a REIT at book value with an ROE of 6% and a manager screwing unit holders yearly.


  1. Hi,

    You may consider adding private placements and rights in 2009.

    In 2011, CMT is placing out 139.7m units (4% of its unit base) privately to raise S$250m in gross proceeds. Pricing took the low end of the range between S$1.79-1.85 per unit, representing 5% discount to its adjusted VWAP of S$1.88 per unit and adjusted FY12 yields of 5.7%. Proceeds will be used to fund AEI and capex obligations at Iluma, Atrium and JCube.

    In 2012, CapitaMall Trust priced a new issue of 125 million new units at S$2.00 each, which represents a discount of 4.8 percent to its adjusted volume weighted average price of S$2.1002, it said in a statement.

    I google and there are many more private placements for capmall.

    By calculating on the basis of nav per share vs IPO shareholders, may not paint an accurate picture.

    I do not track CMT for manyyears but I believe if through private placements and acquisitions is yield accreditive, this is good for the Reit.

    IMHO, there could be a reason why it is top gun as it is not destroying shareholder value.

    I look forward to see your comments on my thinking.

  2. Hi

    Read my post carefully.

    What I done is If the REIT stay as it is = no growth and no new property, NAV per unit will be higher than what it is now. Dividend per unit will be higher.

    Yes, look at NAV per unit mean include all placements. Even those issued to managers.

    Growth is destroying value. What is the point of issuing shares and acquisitions if NAV and dividend doesn’t grow? so there were growth and everyone happy. But if there is no growth via acquisition and stop issuing of shares for all kind of reasons, unit holder get more.

    Number never lie

  3. Hi,

    You are right, if they just stay with 3 malls, it will be great!

    Great analysis.

    Thanks 🙂

  4. Thanks for your analysis. What a crap REIT. Thanks to their mismanagement my units gotten at IPO are practically free and earning dividends annually. How dare they take a portion of these earnings from me. They should just manage for free and not receive any fees. It’s a free world. I’m sure someone like you could have done better.

  5. Of course Alvin, even with a flat yield. your units are “free” and earning dividend after 14 years even if we base it on forecast yield of 7.06% during IPO. If it doesn’t, something is very wrong.

    CMT will be listed for 15 years by Sep 2017.

  6. Interesting, you assumed a shopping mall managed by any tom dick or donmihaihai would naturally increase in valuation by 157% *round of applause to desktop analysis*

  7. Maybe tom and dick can but I would run it to the ground. Leave it to the pro.

    If I bought a HDB in Sep 2002 and totally never take care of it, what would the value of my HDB now. Perhaps tom, dick and not donmihaihai will know.

    How nice it would be if unit holders are able to enjoy 157% increase in NBV as well compare to 92% which they got. And that is my point.

    Anyone who stay in Singapore for the past 15 years will know how well malls managed by CMT compare to others. Unless you never step into any mall.

    An average operator like UOL( ok maybe look average compare to CapitaLand) increase capital value of Novena Square and United Square by a mere 137%. while shareholders are not diluted by more than 10%.

    Cannot tahan den cannot tahan lor.

  8. […] Wrote in 2017 […]

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