The Strategic Hospitality Extendable Freehold and Leasehold Real Estate Investment Trust (SHREIT), a hospitality company operating in Southeast Asia, with properties like a boutique hotel in Saigon South, recently made a move into Thailand’s market. A few days before the end of 2017, the company made its official debut into the Stock Exchange of Thailand, following a very successful initial public offering (IPO) of their units amounting to Bt10/piece. The company, a real estate investment trust group specializing in the hospitality industry, with an investment in Strategic Hospitality Holding Limited (BVI). The group was officially listed in the SET on December 27, 2017, with the ticket symbol SHREIT, and a total value amounting to Bt3.53B, or US$107M.
Its official listing on the SET in the Property Fund & REITs sector, a subgroup of the Property & Construction grouping, meant that SHREIT is the SET’s first REIT that focuses on investing in foreign hotel properties.
The group’s professional managers have already set a target for its operations, hoping to generate as much returns to investors as possible, with a target for the first operational year at 7.67-7.72%.
Strategic Property Investors released a statement via its Managing Director; Patan Somburanasin, who said that the IPO of the group was warmly welcomed by retail and institutional investors in Thailand. He says that this is due to the fact that the hotel properties that SHREIT has invested in would be managed independently, by a third-party, from the sponsors, which meant that they would be able to provide consistent returns to investors.
According to SHREIT’s Managing Director, James Lim, the initial funds would be used to acquire 100% of the stakes of BVI, which will then be responsible for indirectly investing in foreign holding companies in order to acquire 100% ownership of the firms that possess the freehold and/or leasehold rights of the hotels SHREIT is to work with, one of which is a boutique hotel in Saigon, among others. The hotels are as follows:
- Pullman Jakarta Central Park, Indonesia;
- Capri by Fraser, Vietnam, and;
- IBIS Saigon South, Vietnam.
These three hotels combined have a total of 632 rooms, and are handled by professional management teams.