S-Reits in merger race for bigger scale

The proposed merger between OUE Commercial Reit and OUE Hospitality Trust signals a growing trend where Reit mangers combine assets for stronger liquidity and financing capacity.

Singapore-listed real estate investment trusts are tipped to see more consolidation after OUE Commercial Reit and OUE Hospitality Trust proposed to merge their operations into a new entity in order boost liquidity and create a larger capital base to more effectively access funding.  

In a joint statement on Monday, the two companies said the merger will create an entity with total assets of S$6.8 billion $5 billion and a market capitalization of S$2.9 billion, making it the eighth largest S-Reit by total assets and 10th largest by market capitalization.

The proposed transaction is the second merger between Singapore-listed Reits after the consolidation of ESR...

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