First Real Estate Investment Trust, a Indonesia centric healthcare trust with long lease announced this morning of an asset swap with their parent Lippo Karawaci. http://investmentmoats.com/DividendScreener/DividendScreener.php
Announcement can be found here.
The short story is that First REIT will be divesting a hospital at a 112% premium and a plot of land at 3.1% premium to their parent Lippo for development. Upon completion of development in 2019, First REIT will be purchased part of the new building at 12% discount of $90 million.
Income will not be affected right up to the takeover of the new building.
The master lease of the new building is 15 years. This will lengthen First REIT’s rental expiry and rejuvenate their portfolio.
I do anticipate that when the time comes, there needs some debt financing to take over this asset. There will be no impact on current dividend yield of 6.2%
First REIT, as well as other Singapore dividend stocks are featured on my Dividend Stock Tracker.