Frasers Hospitality Trust (Frasers H-Trust) is an SGX-listed stapled group that invests specifically in hospitality based properties. Frasers H-Trust was listed on 14 July 2014 with an initial portfolio of 12 properties worth S$ 1.67 billion. Since then, it has grown its portfolio to 15 properties worth S$ 2.44 billion as at 30 September 2017.
In this article, I’ll list down 10 quick things you need to know about Frasers H-Trust before you invest.
Ticker Symbol: SGX: ACV
Market Capitalization: S$ 1.49 Billion (18 January 2018)
Share Price: S$ 0.81 (18 January 2018)
The properties owned by Frasers H-Trust are located in:
Frasers H-Trust has two properties in Singapore. They are:
- InterContinental Singapore
- Fraser Suite Singapore
Combined, they were valued at S$ 840 million, accounting for 34.4% of the value of its portfolio. In 2017, this segment has contributed S$ 31.0 million and $ 25.6 million in revenue and net property income to Frasers H-Trust.
Frasers H-Trust has four properties in Australia. They are:
- Novotel Rockford Darling Harbour, Sydney
- Fraser Suites Sydney
- Sofitel Sydney Wentworth (Acquired in May 2015)
- Novotel Melbourne on Collins (Acquired in October 2016)
Combined, they were valued at S$ 843 million, accounting for 34.5% of the value of its portfolio. In 2017, this segment has contributed S$ 72.6 million and S$ 48.6 million in revenue and net property income to Frasers H-Trust.
- United Kingdom
Frasers H-Trust has six properties in the United Kingdom. They are:
- Best Western Cromwell London
- Park International London
- Fraser Place Canary Wharf London
- Fraser Suites Queens Gate London
- Fraser Suites Edinburgh
- Fraser Suites Glasgow
Combined, they were valued at S$ 331 million, accounting for 13.6% of the value of its portfolio. In 2017, the segment has contributed S$ 23.4 million and S$ 18.1 million in revenue and net property income to Frasers H-Trust.
Frasers H-Trust owns the ANA Crowne Plaza Kobe. It was valued at S$ 189 million, accounting for 7.8% of the value of its portfolio. The property has contributed S$ 16.9 million and S$ 13.8 million in sales and net property income to Frasers H-Trust in 2017.
Frasers H-Trust owns the Westin Kuala Lumpur. It was valued at S$ 138 million, accounting for 5.7% of the value of its portfolio. In 2017, the Westin has contributed S$ 8.4 million and S$ 7.0 million in sales and net property income to Frasers H-Trust.
Frasers H-Trust has acquired the Maritim Hotel Dresden, Germany in June 2016. It was valued at S$ 98.2 million, accounting for 4.0% of the value of its portfolio. In 2017, the property has made $ 6.4 million and S$ 6.4 million in revenue and net property income to Frasers H-Trust.
#3: The Financials
Since its IPO listing, Frasers H-Trust has acquired the following properties:
|1||Sofitel Sydney Wentworth||May 2015||A$ 224 mil|
|2||Maritim Hotel Dresden||Jun 2016||Euro 58.4 mil|
|3||Novotel Melbourne on Collins||Oct 2016||A$ 237 mil|
These acquisitions had contributed to higher sales and net property income to Frasers H-Trust. Quarterly sales had increased from the S$ 20 – 25 million levels in 2015 to hitting above S$ 40 million in Q4 2017. Since June 2016, the trust has gradually increased its quarterly distributable income from S$ 18.4 million to S$ 23.8 million in Q4 2017. In 2017, Frasers H-Trust has distributed 5.05 cents to its unitholders.
Source: Annual Reports of Frasers H-Trust
Source: Annual Reports of Frasers H-Trust
#4: Major Acquisitions
There is no major acquisitions or disposal of investment properties made by Frasers H-Trust.
#5: Sponsor Strength
Frasers Centrepoint Ltd is the sponsor of Frasers H-Trust. TCC Group is the strategic partner of Frasers H-Trust. Presently, Frasers H-Trust has access to acquire the following properties from both its sponsor and strategic partner:
- Capri by Fraser, Changi City, Singapore
- Fraser Place Robertson Walk, Singapore
- Fraser Place Manila, Philippines
- Fraser Residence Sudirman Jakarta, Indonesia
- Le Meridien Angkor, Siem Reap, Cambodia
- Crowne Plaza Hotel, Kunming, China
- Holiday Inn Hotel, Kunming, China
- Fraser Suites Beijing, China
- InterContinental, Adelaide, Australia
- Hyatt Hotel Canberra, Australia
- Fraser Place Melbourne, Australia
- Capri by Fraser, Brisbane, Australia
- Fraser Suites Perth, Australia
- Fraser Suites Kensington, London, the United Kingdom
- Capri by Fraser, Frankfurt
- Capri by Fraser, Barcelona
- United States of America
- Plaza Athenee, New York
#6: Lease Profile
As at 30 September 2017, the weighted average lease expiry of all properties under Frasers H-Trust is 16.3 years. This is computed excluding the master lease for Novotel Melbourne on Collins as the master lease agreement is an internal agreement between Frasers Hospitality REIT (FH-REIT) and Frasers Hospitality Business Trust (FH-BT). As I write, none of the 15 master leases would be maturing in the next 5 years.
As I write, Frasers H-Trust is trading at S$ 0.805 a unit.
As at 30 September 2017, Frasers H-Trust has reported having S$ 0.816 in net asset value a unit. Thus, its current P/NAV works out to be 0.99.
Frasers H-Trust adopts a distribution policy to declare and pays out at least 90% of its distributable income on a quarterly basis. The trust has declared and paid 5.05 cents in DPU is 2017. If Frasers H-Trust is able to maintain its DPU at 5.05 cents over the next 12 months, its expected gross dividend yield is 6.27%.
#8: Debt Profile
As at 30 September 2017, Frasers H-Trust has S$ 810.9 million in borrowings. Its gearing ratio is 32.1%. The effective cost of borrowings is 2.6% a year and its weighted average debt maturity stands at 2.07 years.
#9: Investor Relations
For further enquiries or to request for additional investment information on Frasers H-Trust’s Investors Relation matters, you may contact:
Head, Investor Relations
Telephone: +65 6349 0423
#10: Major Shareholders
As at 29 November 2017, the substantial shareholders of Frasers H-Trust are:
– FCL Investments Pte Ltd: 21.58%
– TCC Group Investments Limited: 38.00%