The increased carpark fees won't go directly to Suntec REIT as the 3,125 lot carpark comes under the management corporation, an entity that maintains the entire Suntec City complex on behalf of all its owners. Anyway, all these will only happen when Keppel Land shareholder approve the deal. Maybe this is a good way to launch REIT now as the current market sentiment to REIT IPO is not that great as PRIME REIT is trading below IPO price now and the rest of the REIT counters has drop around 15%. The only way to get a hold of this new REIT is either buying Keppel Land share at open market or buy the REIT counter when it started trading in 1Q06. There will be no IPO for this REIT counter as Keppel Land intends to distribute 200 shares of K-REIT for every 1000 shares of Keppel Land held. I think we can use CCT as a minimum benchmark as K-REIT will be very similar to CCT. At the present moment, no information is provided by Keppel Land on the yield of K-REIT. This REIT counter will be focusing on Office and it nearest competition will be CCT which is trading at around 4.9% yield. Initially, the properties that K-Reit own will be Keppel Land's office properties, which are Keppel Towers, GE Tower, Bugis Junction Towers and KepLand's 44% share of the space at Prudential Tower. Today Keppel Land has announced that it will be launching a new REIT in the first quarter of 2006.
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