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HREIT First Capital Increase Approved by HREIT Trust UnitholdersAdditional investment assets represent not over THB 1.690 billion Preparing to submit Filing Application to SEC

posted Jun 23, 2017, 11:02 AM by siam coverage   [ updated Jun 23, 2017, 11:04 AM ]

Bangkok, 22 June 2017 – Trust Unitholders of Hemaraj Leasehold Real Estate Investment Trust (HREIT) have agreed on the first capital increase of not over THB 1.690 billion for long-term investments, including 30-year leasehold rights for ready-built factories and ready-built warehouses, with the right to extend for another 30 years. The additional investment assets have the occupancy rate of 100% with compensated income for vacant units for the first three years. This increase brings HREIT’s assets to approximately THB 10 billion. HREIT is preparing to submit its filing application to the Securities and Exchange Commission Thailand (SEC) and expects additional asset investments by the end of this year.

Dr. Somyos Anantaprayoon, Chairman of the Board of Directors of WHA Corporation PCL. (WHA Group) and Hemaraj REIT Management Co., Ltd. said, “During HREIT’s first extraordinary general meeting for 2017, HREIT Trust Unitholders agreed on the additional investment assets of not over THB 1.690 billion, which will increase total HREIT assets from approximately THB 8 billion to almost THB 10 billion. In addition, these additional investment assets have a 100% occupancy rate and the asset owners will compensate the revenue from the rental and service fees of the vacant unit if any.

This investment will make HREIT’s fund even bigger, generate more liquidity and increase economy of scale, all of which will benefit investors and HREIT operation result. After additional investment estimate distribution per unit will be 0.77 Baht per unit or about 9% yield when compare to the current market price


Ms. Kanchana Ouaoborm, Managing Director of Hemaraj REIT Management Co., Ltd., the REIT Manager of HREIT, said, “After HREIT Trust Unitholders agreed on the additional investment assets, HREIT is preparing to submit its filing application to the Securities and Exchange Commission Thailand (SEC) with the capital increase expected by the end of this year.

HREIT’s additional investment assets will be through leasehold rights for ready-built factories and ready-built warehouses in five locations of Hemaraj Industrial Estates;

Eastern Seaboard Industrial Estate (Rayong) (ESIE), Hemaraj Eastern Seaboard Industrial Estate (HESIE), Hemaraj Saraburi Industrial Land (HSIL), Hemaraj

Chonburi Industrial Estate (HCIE) and Hemaraj Logistics Park 4 (HLP4). Additional rental area accounts for approximately 55,131 square meters in addition to the current invested area of 261,314 square meters in six projects in Chonburi and Rayong. Thus, the total rental area of HREIT will be equal to 316,445 square meters.

“HREIT’s additional investment assets are worth not over THB 1.690 billion for 30-year leasehold rights in ready-built factories and ready-built warehouses, with the right to extend for another 30 years for the total area of 55,131 square meters (RBF 47,552/ RBW 7,579). These additional investment assets will be raised by selling not over 169 million trust units and a long-term loan of not over THB 700 million from financial institutions,” Ms. Kanchana explained.

Following HREIT additional investment assets, projected profit sharing and dividends distribution per unit should not be lower than that prior to the trust’s additional asset investments.

Ms. Kanchana Ouaoborm also emphasized, “These additional investments are for high-quality assets with full rental bookings and high income potential. This will yield more stability, rental income and better performance that will benefit the HREIT. Moreover, this aims to reduce risks by seeking new tenants as new income source rather than relying on existing tenants only.”

For more information: www.hemarajreit.com
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