EC World REIT, which has port logistic and warehouse logistic assets in China in cities such as Hangzhou and Wuhan, is trading at around DPU yields of 8%. This is because 67% of the properties by gross rental income are master leased to the sponsor and its related parties. Hence, there is a discount for lack of transparency and a relatively unknown sponsor.
Raising monies from investors are Daiwa House Logistics Trust (DHLT), Mapletree Logistics Trust (MLT) and Digital Core REIT (DCR). On Nov 22, DCR lodged its preliminary prospectus. On Nov 23, MLT announced the proposed acquisition comprising 17 properties for $1.4 billion including expenses. In the meantime, DHLT’s IPO offer closed on Nov 24.
Of course, REITs with wellknown sponsors are likely to command a premium with a lower cost of capital. Hence it will be interesting to see how DHLT debuts.
