Pavilion REIT (Real Estate Investment Trust) IPO



Pavilion

Pavilion REIT (Real Estate Investment Trust) is scheduled to be listed in Main Market of Bursa Malaysia on the 7th December 2011. The Initial Public Offering (IPO) consists of 790 million units at an IPO price of RM0.88 per unit.

Out of these, 755 million units are offered to Malaysian and foreign institutional and selected investors and a retail offering of 35 million units to the Malaysian public, eligible tenants and directors of the Manager and its eligible employees, Urusharta Cemerlang Sdn Bhd, Capital Flagship Sdn Bhd and Kuala Lumpur Pavilion Sdn Bhd.

The institutional price will be determined by way of book building while for the retail application, it is payable at RM0.88 upon application. If the final retail price is lower, the difference will be refunded.

The Pavilion REIT is managed by Pavilion REIT Management Sdn Bhd (the Manager) and they expect to raise RM695.2 million from its Initial Public Offer (IPO). The manager will use part of its proceeds as part payment for the acquisition of the initial property portfolio and to pay for a capital loan.

This IPO is the fourth largest in Malaysia this year after Bumi Armada Bhd, MSM Malaysia Holdings Bhd and UOA Development Bhd.

The Employees Provident Fund, Kumpulan Wang Persaraan, Great Eastern Life and American International Assurance Bhd are among the cornerstone investors for the IPO.

Currently, Pavilion REIT is made up of two assets namely Pavilion Kuala Lumpur Mall (Pavilion Mall) and Pavilion Tower. The total appraised value of Pavilion REIT’s portfolio is RM3.5 billion. The management is also looking for potential acquisition of the Pavilion’s extension and the F&B mall in USJ Subang Jaya in between 2014 to 2015

The table below is the financial summary of Pavilion REIT.

FYE 2008 FYE 2009 FYE 2010 FPE 2010 FPE 2011
Revenue (RM’000) 230,586 242,224 256,699 127,613 133,055
Net Property Income (NPI) (RM’000) 165,191 186,361 202,874 102,141 111,583

 

In 2011 & 2012, the management intended to pay 100 percent of the distributable income to the unit holders. This translates to a dividend yield of approximately 6.5 percent per annum. Distributable income is the Net Property income (NPI) minus the trust expenses such as management fee, trustee fee and borrowing cost.

The dividend yield is comparable to another local REITs such as Sunway REIT and CapitaMalls Malaysia.

CIMB, Credit Suisse and Maybank are the joint global bookrunners for the deal of the IPO.

For those who are interested in Pavilion REIT IPO, you may subscribe at ATM machines or via Internet Banking.

The retail subscription period is opened until 21st November 2011 at 5pm. Tentative balloting date is on 24th November while the allotment date is on 5th December 2011. Pavilion REIT stock name in Bursa Malaysia is “PAVREIT”.

View Pavilion REIT prospectus in Bursa Malaysia webpage.

What do you think about Pavilion REIT IPO? Are you going to subscribe?


Leave a Comment

  • Ahmad Hati 15th November, 2011, 12:42 am

    Is it worth it to buy?

    Reply
  • eason 15th November, 2011, 12:13 pm

    Bumi Armada Berhad stock name in Bursa Malaysia is “PAVREIT”.???

    Reply
  • 1-million-dollar-blog 15th November, 2011, 5:26 pm

    Ahmad Hati, it is like investing in other REIT. Good if you like dividend stock.

    eason, it is a typo error. Thank you for point it out.

    Reply
    • Ahmad Hati 16th November, 2011, 1:58 pm

      For example i just bought 5 Lots, is it worth it

      Reply
    • 1-million-dollar-blog 16th November, 2011, 5:11 pm

      Are you saying buy 500 units? If you do, you will earn so little for the first year due to brokerage/clearing fees & stamp duty.

      Reply
    • Ahmad Hati 16th November, 2011, 11:41 pm

      If 1 lot (100 units), i just to know more info. As im a student, i want to get use my CDS account. 500 units also can earn profit? If so i want to buy it

      Reply
    • 1-million-dollar-blog 17th November, 2011, 3:22 pm

      Ahmad Hati, as I said above, you can but it will be small.

      Reply
  • kingjoke 15th November, 2011, 6:06 pm

    i wil try my luck this time…

    Reply
  • LCF 16th November, 2011, 1:35 am

    The Mall itself is of more than RM 3 billion worth – definitely impressive, considering CapitalMalls REIT total portfolio of RM 2.4 bil with 3 malls!

    Reply
  • kampunginvestor 16th November, 2011, 2:01 am

    I will go for this also. Wish everybody all the best with Pavilion Reit! Huat ya…!! ^^

    Reply
  • 1-million-dollar-blog 16th November, 2011, 8:33 am

    Good luck for those who apply. I may skip because I run out of capital.

    Reply
  • nik 16th November, 2011, 9:05 am

    looks good. but dont think its syariah compliant, right? so skipping it..

    Reply
  • sekdarakhulu 16th November, 2011, 6:41 pm

    bro..as far as i know shariah compliance only given after listing not during IPO..btw confuse already now to pursue this or Gas M’sia..aiyooo

    Reply
  • 1-million-dollar-blog 17th November, 2011, 3:23 pm

    sekdarakhulu, not necessary. Some counter get shariah approval prior listing. For Gas Malaysia, don’t worry it should be shariah counter even it does not get it before listing.

    Reply
    • Zulfadli 18th November, 2011, 6:32 pm

      How about this counter? is it shariah counter?

      Reply
  • 1-million-dollar-blog 18th November, 2011, 10:09 pm

    Zulfadli, I have no idea about this one.

    Reply
  • kampunginvestor 22nd November, 2011, 1:09 am

    I applied 22000 shares this time around. Hope can get it this time and make some money out of it. So far my IPO luck not so good le.. =.=!!

    Reply
    • kingjoke 24th November, 2011, 12:50 pm

      Hi bro. i applied slightly lower than u, hope can get tru some. News in europe not so good, hope it wil not effect this stock

      Reply
  • 1-million-dollar-blog 22nd November, 2011, 11:31 pm

    Good Luck to you. I skip this time.

    Reply
  • AskChong 24th November, 2011, 6:16 pm

    Not interested.

    I think overvalue and over concentration of risk. There are many good REITs already…… SUNREIT and STARREIT.

    Reply