Centurion Accommodation REIT Makes Waves in Singapore!

Get ready for a game-changer in Singapore's investment scene! Centurion Accommodation Real Estate Investment Trust (Reit) is set to unveil its initial public offering (IPO) this Thursday evening, marking the second-largest mainboard listing on the Singapore Exchange (SGX) this year.

Offering a staggering 262.2 million new units at just S$0.88 each, this IPO is positioned to raise around S$771.1 million. This will be bolstered by an additional issuance of 614 million units to 16 cornerstone investors, with sponsor Centurion Holdings retaining a significant 787.4 million units.

A Diverse and Valuable Portfolio Awaits!

Centurion Accommodation REIT boasts an impressive initial portfolio valued at S$1.8 billion, featuring 14 prime assets. These include five purpose-built workers’ accommodations in Singapore, eight dedicated student accommodations in the UK, and one in Australia. But that's not all—following the listing, the portfolio's value is expected to soar to S$2.1 billion as they acquire another student housing asset in Australia currently in development!

Strong Growth Prospects in a Booming Market!

Tony Bin, the CEO of Centurion Accommodation REIT’s management, is optimistic about the Reit's growth trajectory. With robust demand for both workers' and student accommodations, especially in Singapore, the UK, and Australia, the Reit is poised for success. Bin highlighted that the trust's PBWA assets have maintained an impressive average occupancy rate of over 97%, alongside a remarkable compound annual rental growth rate of 26.3% between FY2022 and FY2024.

The student housing segment has shown an equally strong performance, averaging a 94% occupancy rate and an 11.3% annual rent growth rate over the past three years.

Profit Growth and Stability on the Horizon!

Looking ahead, the management projects the distributable income to reach S$114.8 million by 2026, with a healthy increase of 6.6% to S$122.4 million in 2027. Bin notes the significant advantage of having a Singapore-centric portfolio, which accounts for about 73% of the net property income and 64% of total property value.

Beyond Workers and Students: Future Growth Opportunities!

While the focus remains on workers' and student accommodations, the Reit has broader investment potential. Plans may include diversifying into other living sectors like build-to-rent, senior housing, and co-living, provided the opportunities align with their strategy.

Bin emphasizes the need for stability, stating, "For us, we need stable income and cash flow—we can’t take on developmental risks and uncertainties." The team will remain busy optimizing the portfolio while exploring avenues for growth and enhancing yields for investors.

Key Dates and Trading Expectations!

Mark your calendars! The Singapore public offer for Centurion Accommodation REIT opens at 10 PM on Thursday and closes at noon on Tuesday. Investors can expect the counter to commence trading at 2 PM on September 25.

This significant launch follows Japan’s NTT DC REIT debut in July, which raised a record US$773 million—one of the largest IPOs in Singapore in the past four years. Will you seize the opportunity with Centurion Accommodation REIT?