Over the last two years, OUE has been making significant changes. Two REITs were set up and several properties have been sold into two REITs, namely OUT H-REIT and OUE Comm Trust, to unlock the values. Last year, the Orchard Hotel and Manadrin Gallery as well as very recently, the Crown Plaza Changi have been sold into OUE Hospitality Real Estate Investment Trust (OUE H-REIT). Then there was also another tranaction, transfering OUE Bayfront and Lippo Propoerty in Shanghai to the OUE Comm REIT.
The changes have helped to unlock property values and reduce OUE’s gearing. The share price has been quite muted amidst all these changes. In fact, it has been trading at a steep discount of 50% at $2.18 against the NAV of $4.35.
(Brennen Pak has been a stock investor for more than 25 years. He is the Principal Trainer of BP Wealth Learning Centre LLP. He is the author of the book “Building Wealth Together Through Stocks.”) – The ebook version may be purchased via www.investingnote.com.