Other factors that came up during the analysts’ briefing were borrowing costs of "high 3s" for existing loans, 100% asset management fees in units assumed for the acquisition and tax transparency in the existing structure.
Despite widely positive response to Frasers Centrepoint Trust (SGX:J69U
) ’s proposed acquisition of Northpoint City South Wing, JP Morgan highlights a few cautionary points.
JP Morgan points out that the acquisition net property income yield (NPI) yield of 4.5% is lower that ION Orchard’s acquisition yield of 4.9%, and 4.8% for FCT’s acquisition of Nex. “This is due to the relative longer land tenure for Northpoint South Wing,” JP Morgan says.
