Centurion Accommodation REIT IPO-Preliminary Thoughts and Highlights (Part 1).

Centurion Corporation Holdings will be launching the IPO of its workers' dormitories and UK student accommodations soon. It will be known as the Centurion Accommodation REIT ("CAREIT"). CAREIT will be paying out a very attractive 7.66% distribution yield for FY2026 and 8.57% for FY2027 based on S$0.88 per unit. The targeted listing date that its management are eyeing on seems to be early October 2025. I will do up another post after looking through its prospectus filed with the MAS- it is a jaw- dropping 1240 pages thick- before sharing my final thoughts in subsequent part 2 post of whether to get into this IPO. Preliminary highlights as follow:   

1. The enigmatic "Mandai Expanded Capacity" Terminology-Poorly Crafted and Misleading Propsectus.

In the prospectus, one will keep seeing this strange term appearing (first appeared on page 100) and talking about the impact of "expanded" capacity but then the definition appears quite the opposite as it is loosely worded as a contradictory reduction of bed capacity. So what the heck is this term talking about? 

Definition of  "Mandai Expanded Capacity"

It was further mentioned in the prospectus that the Mandai Expanded Capacity Consideration” means the consideration of S$34.0 million payable in relation to the Mandai Expanded Capacity. Such consideration is payable when the Mandai Expanded Capacity (i.e. the additional 1,980 beds) is operational for immediate occupation (Please see Page 288 of the Prospectus for details)

Unless otherwise stated, all information in this Prospectus relating to the Properties, such as Agreed Property Value, Appraised Value, aggregate purchase consideration, number of beds and portfolio information, excludes the Mandai Expanded Capacity and the Mandai Expanded Capacity Consideration.

2.  So what the heck is "Mandai Expanded Capacity" then?

<Quote>

"Mandai Expanded Capacity" refers to the 1,980 beds in Westlite Mandai which were supposed to be removed upon completion of an additional block. 

</Quote>

Now, this becomes a real test of one's English language. My initial understanding is that the essence and emphasis is on the 1,980 beds that will be eventually removed.

3. Nope, my initial understanding is totally wrong!

After looking through the financial projection on page 200 and also number of beds including and excluding comparative in Mandai property on page 291, the essence as aforesaid mentioned in point 2 above totally does not align with the financial information.

 

Personally, I thought that the investment banker or staff crafting the definition of the Mandai Expanded Capacity ought to be shot. They are actually referring to 2 points here:

(i) it includes in the 1,980 beds in Westlit Mandai that was supposed to be removed but still taken in as revenue generating since the new government regulation only come into effect after 31 December 2030.

(ii) on top of (i) above, the term also includes in an additional 3,696 beds from the 4th block that is still in development and expected temporary occupation ("TOP") in January 2026.

The original definition is totally misleading and contradictory to different parts of the prospectus and not transparent at all.  

So the point is that the financial projection on page 200 on Distributable Income actually includes in the assumption of the successful leasing out of beds in phases in the newly built 4th block of Westlit Mandai. The risk here of course then is whether the projection is overly optimistic.   

3. Management Fees.
The base management fees and incentive structure is quite similar to the Mapletree Pan Asia Commercial Trust. Other REITs are on the AUM model. So think still in line and a fair model.

4. The Enlarged Portfolio.
This is the other strange part that keep popping out on "enlarged" and normal portfolio that forms the REIT. Basically, this is referring to the Epissod Macquire Park Student Accommodation that is currently still being built. But it will be added into CAREIT after it is listed as it is about 6 months away from completion.

Parting Thoughts.

Personally, I am actually annoyed at the poorly and loosely crafted "Mandai Expanded Capacity" that leads to a lot of mental acrobatics which gives a rather poor impression of the entire IPO. I will do a part 2 post of my personal thoughts on whether I am jumping into this upcoming IPO after diving through the prospectus. 

New Dividend Fund Allspring Global Equity Enhanced Income Fund- Targeted 6% Dividend Yield Per Annum.

Just came across the Allspring Global Equity Enhanced Income Fund from Endowus recommendation on dividend funds besides Fidelity Global Dividend Fund and Fidelity Asia Pacific Dividend Fund. Interesting thing about this Allspring unit trust is that it invested in global dividend stocks as well as employ an option strategy to earn option premium. Of course, if market performs well, this Allspring fund may lack behind due to the use of option. 

1. Performance of Allspring Global Equity Enhanced Income Fund

It has outperformed the high dividend benchmark and peers since its inception in 2020 while providing clients with a consistent quarterly dividend income stream. It offers a target pay-out of 6% with 4% from a high yielding equity component and 2% from an options overlay strategy. Options overlay is dynamically managed to ensure that the upside of the equity sleeve is not adversely compromised. 

Its NAV also has a good overall uptrend unlike some funds which pays high dividends of more than 8% per annum but is actually paying this out of their capital with NAV going downwards.

Overall, Allspring Global Equity Enhanced Income Fund has annualised returns of 16.42% over the past 3 years which is extremely impressive.

2. Low overall annual management fees of only 0.8% per annum at fund level

This is way lower than many of the equity funds (over 1%) out there with only 0.8% per annum.

3. Be careful of its US sector exposure

I think that the US stock market is overly valued. This fund does have close to 20% exposure to US with tech stocks such as Nvidia in its stock holding portfolio. For those who thinks that the AI bubble will burst, then there maybe potential downside from holding on to this particular fund. It is also not very clear and transparent on 76% of its geographical allocation as it show up as "Unclassified". So the big question mark is what is "Unclassified"?

4. Size of Fund is only S$117.5Mil as at 29 August 2025.

The fund size is actually very tiny relative to the Fidelity Global Dividend Fun of S$22.9 billion as well as to the Fidelity Asia Pacific Dividend Fund of S$500Mil. There is the probability that this Unit Trust may be closed down by its fund manager and one maybe exiting their investment at the worst possible time due to market downturn.

Parting Thoughts

I maybe allocating part of my future portfolio into this fund for diversification. Do note that there is another similar USD funds by Allspring with the same name. However, one should go for the SGD hedged fund to minimise one's forex risk. Another point to note is that this fund pays out distributions on a quarterly basis and not monthly.

Venture Into UnitedHealth Group- Will It Recover To Its Heyday of More Than US$630 Per Share?

UnitedHealth Group is a multinational health and well-being company that operates primarily in the United States and internationally through its health benefits business. As can be seen in the share price of UnitedHealth Group's ("UNH") trending over the past few years, 2025 saw a disastrous collapse of it's share price to a record 5 year low of U$234.60 at 1 given time. While it has since recovered to the level of approximately US$310 per share, it is unfortunately just a faint shadow of its former glorious day. I have decided to take up a a very tiny position in UNH as I think that in the long run, its experienced management team should be able to resolve all current challenges and its earnings should at least go back up by 50% even if not 100%. 

Recent decline in UNH’s share price stems from a combination of operational pressures, regulatory concerns, and leadership instability:

(1) Skyrocketing medical costs

The company’s medical cost (loss) ratio surged to 89.4%, up from around 82% in 2022, severely eroding margins. Operating margin dropped from 8.8% to approximately 7.3% over the last year.

(2) Collapsed earnings guidance & missed expectations

UNH slashed its full-year adjusted EPS forecast from about $30 to just $16—a ~47% downward revision—falling well below analyst expectations. In Q2 2025, it reported EPS of $4.08 vs. ~$4.48 expected, disappointing investors despite revenue being roughly in line.

(3) $6.5 billion of unexpected medical costs

This oversized burden, mainly impacting Medicare Advantage and Medicaid segments, triggered sharp margin contraction.

(4) DOJ investigations and regulatory scrutiny

UnitedHealth confirmed both criminal and civil investigations by the U.S. Department of Justice concerning its Medicare billing and practices—heightening uncertainty.

(5) Leadership upheaval and reputation risks

The abrupt resignation of CEO Andrew Witty and the fallout from the high-profile murder of an executive, Brian Thompson, who was shot and killed while walking to an investor conference further rattled investor confidence.

Parting Thoughts

It had been reported that Warren Buffett’s Berkshire Hathaway purchased approximately 5 million shares of UNH during Q2 2025, investing around U$1.57 billion, which means an average entry price of about $314 per share. Based on its share price of US$307 per share as at 3 September 2025, this means that one is buying in at a lower price than Berkshire. I have initiated a tiny position of 2 shares into UNH. Will accumulate further if the price of UNH went back into a slump below US$300 per share.

Will Alibaba (9988) Rise 10% This Week In Line With US ADR Performance?

Interestingly, Alibaba missed analyst revenue target but its US ADR shot up more than 10% last Friday. Apparently, market is excited over the news that Alibaba is producing its own AI chip. I am not sure whether market were speculating that Alibaba may be going down chips production like Nvidia or excited over the impressive more than 20% Alibaba cloud growth. On hindsight, should have added in S$10K of Alibaba stocks last Friday but then who can predict the market right? 

Investment Portfolios Updates (29 August 2025) - Net Investment of S$813K and Projected Annualised Passive Income of S$48K.

Hi Folks, welcome back to my bi-monthly investment portfolios update. With the anticipation of the long awaited lowering of US interest rates finally having a high chance of materialising after Powell's recent speech, REITs' rally became more sustainable from the expected higher distributable income from much lower financing cost. Let's keep our fingers crossed that the September 2025 first rate cut of 25 basis points happen as per anticipation- I really have enough of the roller costal ride over the past year. With the recent strong rally from REITs, my overall gross portfolios hits S$1.08Mil while net portfolios after leverage hits S$813K. This is a drastic improvement of almost +S$80K in just 2 months from the market recovery. As a mainly dividend focused strategy investor, it is not this capital gain that excites me but rather the upcoming additional cashflow expected from the lower interest rate effect on my various investment portfolios and additionally, the significant savings from my margin loan. 

1. Portfolio 1- Stocks Held in SGX Central Depository 

Not much changes here except for the improved market valuation of equities during the recent rally.

2. Portfolio 2- Margin Purchased Securities

(Note: My margin purchased securities has grown to a sufficient scale to sustain itself and can pay off annual financing charges as well as to gradually pay down the margin loan through the dividends generated.) 

Keppel and Lendlease continue to perform exceptionally well. The gross dividend yield is currently on the low side as Keppel Pacific Oak US REIT is still in the midst of distribution suspension and will only resume its payout in 2026. Also, there is around S$15K invested in Alibaba when its price drop below HKD110 per share recently.  

3. Portfolio 3 (with Tiger Brokers and MooMoo) 

(Venture into higher risk as well as capital growth stocks here)

4. Portfolio 4 (Endowus Unit Trusts & Other Investments)

I continued to add to my Endowus bond funds of PIMCO and Pine APB to diversify away from excessive heavy weightage of my entire gross portfolios in equities. This may also be the last opportunity to accumulate interest income as former attractive bond interest yield is fast coming down. Going forward, I will also be drawing down the pay-out from this particular portfolio for daily uses. 

Parting Thoughts

Well, I am happy that the interest rate cuts from my wish list is finally materialising. Ok, that's all the updates I have for today folks. Have a great week ahead!

China has Sufficient Thorium Nuclear Fuel Deposit to Power Itself for 60,000 Years.

Interestingly, China has discovered vast deposits of Thorium in Bayan Obo mining complex in Inner Mongolia, a northern autonomous region, where estimates suggest that full extraction of these deposits could yield up to one million tonnes of thorium. This substantial reserve can fuel China for the next 60,000 years.

1.Benefit 1: More In Abundance Than Uranium 
The importance of thorium in the nuclear energy industry lies in its potential to be a more abundant and efficient substitute for uranium, potentially addressing energy needs in the long term. Thorium is three times as abundant as uranium and nearly as abundant as lead and gallium in the Earth's crust. The Thorium Energy Alliance estimates "there is enough thorium in the United States alone to power the country at its current energy level for over 1,000 years.

2.Benefit 2: Safer Than Uranium

Long-lived radioactive waste for thorium is just a fraction from nuclear plants using Uranium. In a molten-salt reactor, thorium is combined with lithium fluoride and heated to extreme temperatures of 1,400°C, where neutron bombardment initiates a chain reaction. This method is more efficient than conventional uranium reactors, generates significantly less nuclear waste, and minimizes the risk of catastrophic meltdowns

3.Thorium Nuclear Fission Fuel Just A Myth?

Nope, this is not a myth. China has already successfully proven the functionality of this concept. It has built the world's first thorium molten salt reactor (TMSR-LF1) in the Gobi Desert, achieving stable criticality in 2023 and reaching full power operation in 2024. While the reactor is a small one and only 2 Megawatt, it demonstrated the feasibility of using the less pollutive thorium to replace uranium as a nuclear fission fuel.

Parting Thoughts

The use of thorium should buy our human race sufficient time to achieve a breakthrough in the holy grail of nuclear fusion technology whereby atoms are fused together to generate energy and the waste generated are low-medium level radioactive materials relative to the current nuclear fission process. 

(Note: For those interested about uranium and thorium, can read more here.)

The Margin Investing Series 1- The Income Booster Approach To Early Retirement.

Hi Folks, welcome to another episode of Investment Income For Life. Today, I am going to touch on a very sensitive topic, that is, the use of margin financing as an investment tool to boost passive income.  Anyway, just a personal sharing session on why I embark on this path and how this margin strategy works to boost income and open up a route to escape the rat race earlier- please see below video.

A Date With My Financial Planner- Stop Investing Yourself and Leave It To Your FA To Manage For You.

Earlier this week, I metup with a Financial Planner for one of my critical illness policy-let's call him "David". David has been asking for a meet-up to review my financial planning needs as people in different stages of life have varying needs as he put it. We met-up at Ya Kun Toast Box. He went on to say that he is different from other financial planners as he don't anyhow push products but rather listen to customers to know more about their needs before recommending them appropriate products. 

1. Stop Investing Yourself and Leave It To Your Financial Planner To Manage For You.

Before long, David started talking about how his client lost over 30% in stock investing when this client went on holiday and forgot to place a stop loss standing order. Hence one should spend time on focusing on his/own jobs and family instead of doing investments themselves- leave such investments to the trusted Financial Planner. He then rattled on that the unit trusts he recommended his other clients were making over 30% recently. 

This is the classic sales tactics of brain-washing customers to keep them dependant on their financial planner by arguing that people should spend their time on more "useful matters". The hard truth is that your financial advisor will not help you pick or buy/sell individual stocks. They will just be putting your money into a fund run by a fund manager. So, they themselves are actually just acting as a middlemen to the different unit trusts out there. 

Personally, I think that everyone needs to learn how to manage their own money and NOT leave it to a financial planner. If one is not good in stock picking, then there are other alternatives out there such as buying passive index funds (SPY500) or buying recommended portfolios from Robo Advisors such as Endowus or Syfe or even the local banks (DBS, UOB & OCBC) which have their own recommended managed fund portfolios. 

2. Change Your Hospitalisation and Surgical Plans ("H&S") to Cheaper Premiums Insurance Provider On a Yearly Basis To Save On Premium Costs.

The other shocking point on the meetup is when David mentioned that H&S premiums have very different amount of premiums these days for different age groups. Hence before any renewal with current provider, David highly recommend all his clients to approach him first to see whether other insurance providers H&S are cheaper. The difference can be more than S$1K per year for an entire family he asserted. 

I have to politely tell David that this can be extremely risky as there maybe pre-existing conditions that one is not aware of and that will complicate matters in event that you suffer from a major medical condition after switching over. There is always the risk that your new insurer will argue that this is pre-existing condition. This is just creating vast uncertainty in one's own risk management. 

Final Thoughts

I bade farewell to David in about half an hour time as I think that some of his beliefs are just way too strange. The only useful thing I got out from him is the will planning in event of one's own death. It is best to lay down a proper will on what to do with one's wealth else your remaining family members maybe spending unnecessary cost to get the lawyer to write in to all banks and wealth management platforms to enquire about whether you got any holdings with them.   

US Office REITs Recovery Play (KORE focus) And Disappointing Projected Distribution Yield Even If Full Payout Resumes-Part 2

Hi Folks, today let's do some stress tests on the expected distribution yield of Keppel Pacific Oak REIT ("KORE") once it resumes its distribution in FY2026. I know that there are many folks who have been holding on to their US commercial office REITs units since the pre-COVID days which also coincided with the then super low interest rate environment. There are also folks who have accumulated additional units of Manulife US REIT ("MUST"), Prime US REIT and also KORE to take advantage of the implosion in unit pricing at rock bottom while waiting for capital appreciation and dividends post recovery phase. KORE seems to be in a better shape than Prime US REIT and MUST from the key metric of occupancy rate and also leverage ratio. 

First and foremost, let's take a quick look at the recent announced cashflow of KORE 2nd half results before we annualised the numbers for analysis. The net operating cashflow from rental of offices has plunged from US$36.2Mil for 1H2024 to only US$29.8Mil for 1H2025. This is disastrous. This is a drop of <US$6.4Mil> rental income for half a year and if we annualised it, this will be precarious drop of <US$12.8Mil> in FY2025. 

Extract of Cashflow Statement 1H FY2025

Next, we will proceed to examine 3 different scenarios by assuming different level of CAPEX spending and the free cashflow available for distributions. 

1. Assuming CAPEX Required in 2nd Half 2025 is similar to 1st Half 2025

For this conservative scenario, the free cashflow is unable to sustain any payout unless KORE's management decided to go back to their own way of using borrowings to finance renovation to trigger off new leases or renewal of existing leases. 

2. Assuming CAPEX Required in 2nd Half 2025 same as FY2024 Full Year as Benchmark

Initially, as alluded to point 1 above, I thought that I was too conservative with the CAPEX of FY2025 when I annualised the half year released results of 30 June 2025. So I decided to just go back to FY2024 full year to use the CAPEX as benchmark to stress test the free cashflow available. Unfortunately, I got into a even bigger deficit of <US$18.4Mil>. 

3. Assuming CAPEX to Trigger off New Leases Already Done by 1H FY2025 and ZERO for 2H FY2025

If we can assume that KORE management has completed all the necessary renovation add on to their investment properties and that the CAPEX for 2nd half is zero, then we will have US$12.7Mil available for distribution in FY2026. This will be a sustainable 5.79% distribution yield under this relaxed assumption.

Parting Thoughts-Personal Thoughts

The expected sharp recovery in market price of KORE may not happen overnight albeit the 70% discount off its NTA per unit of US$0.70 as the probable distribution yield will be between 0% to 5.79% based on my projection if KORE decided to include in CAPEX and stop their unhealthy previous practice of paying for renovation using bank borrowings. 

US Office REITs Recovery Play And Disappointing Projected Distribution Yield Even If Full Payout Resumes.

Prime US REIT just released its first half results ending 30 June 2025. The results are a mixed bag of good news as well as some slight disappointment. Good news is that green shoots are indeed confirmed with the US office market making a painful but gradual slow recovery from both more favourable demand and supply side. The disappointing news is that distribution is still at only a fraction of the historical distribution. As for Keppel Pacific Oak REIT ("KORE"), its earlier announcement is also not too bad with occupancy maintained at the high end of 85%. I will run a financial projection later on for sharing also on the expect distribution using Prime US REIT to see the 2026 normalised distribution yield.

1. Current US Office Commercial Sector Updates

On the supply front, office ground breakings hit all-time lows, and the construction pipeline contracted to near historic levels, at a fraction of pre-pandemic levels. At the same time, inventory removals for conversions and demolitions outpaced new deliveries, resulting in a net decline of 700,000 square feet nationally in Q2. Scarcity of new, high-end supply is driving aggressive rent growth in the trophy segment and is expected to spur increased spillover demand in well-located, renovated assets as the pipeline dries up

Extract of Prime US REIT Occupancy

2. Financial Projection of Distribution Yield in FY2026 Normalisation.

The numbers are looking really bad with cash balances still dwindling. Free cashflow also still in huge negative after paying for CAPEX and financing expenses. Please see below.

Basically, unless Prime US REIT goes back to its previous free wheeling practice of paying CAPEX with more borrowings, there is nothing much left for payback to unit-holders. Some good news here is that Prime US REIT managed to sign on new 120,000 sqft leases at Waterfront At Washingtonian in June 2025 as well as 43,000 sqft of new leases at its Village Centre property in the same month. But the resultant upsides in cashflow from these new leases using US national average of US$32.87 per sqft annually for proxy reference, will mean only an additional net positive cashflow of US$5.36Mil.

If we divide it by 1,308,259,000 units, then the sustainable distribution per unit will be US$0.0041 per unit. Based on market price of U$0.175 per unit as at 13 August 2025, the annualised yield will thus be 2.34% in FY2026 assuming 100% pay-out ratio is reinstated. (Let me know if there is anything incorrect in my maths or assumptions).

Parting Thoughts
Retails investors need to take note that even if the management of Prime US REIT decided to reinstate the distributions, the payout will now need to factor in CAPEX requirement to cover for activating new leases. Unless operating rental income goes up further along with further cut in CAPEX and financing cost, there is not much left in terms of free cashflow for distribution to investors.

DBS Wonderful PayLah S$3 Cashback Programme and the Ugly Sides of It.

I love the DBS PayLah cashback rebate promotion every Saturday morning where DBS gives back to society as well as gained marketing exposure from it. Nonetheless, I was somewhat exasperated by some dark side of it over the past 2 weekends:

1. Aunties Jostling up the Escalator to Hawker Centre As If It Is The End of the World.

I was shocked by elderly aunties moving to the right side of the escalator and climbing it to beat others in the queue at 7.30am. Hey, I mean the cashback is up to the first 160,000 folks and it normally ends at 9am or 9.30am so there is ample time. I think folks need to take care of their own safety rather than have the fear that the promotion will run out soon in the next minute.

2. Long Waiting Time At Participating Stall’s Cashier- Guy with 3 Mobile Phones For Payment.

This is madness. This morning I saw a young chap in front of me who took ages to complete payment for 3 packets of Nasi Lemak and White Bee Hong. The young man was fumbling with unlocking 3 different mobile phones (he probably took his wife and kid phones along) for making payment. This is too much lah. Isn’t this also a breach of banking security by making payment using accounts not belonging to him as well as creating a public nuisance? 

Imagine if everyone were to follow, there will be folks with 6-7 phones each such as from their grandparents, spouses and kids  and unlocking them one by one to use the respective PayLah. It will take ages for the queue to clear.

Parting Thoughts

Haiz, sometimes I don’t know whether to laugh or cry when I met such strange folks and their intriguing pattern….haha.

Lendlease Global Commercial REIT Makes Big Strategic Mistake to Sell Off JEM's Office to Keppel Ltd.

After a few months since rumour began circulating, Lendlease Global Commercial REIT ("LREIT") finally revealed on August 4, 2025, that it will indeed be divesting Jurong East Mall ("JEM") office for S$462 Mil. The buyer of the office tower is Keppel Ltd.

1. Big Strategic Mistake To Sell off JEM Office.

LREIT should have sold off the underperforming Sky Complex buidling in Milan. Instead it sold off a high yielding office building at JEM with stable government agency tenant. I recalled that they just got a 13% rental reversion after the recent 5 years review in 2024. JEM's area is currently still undergoing transformation and development and LREIT will be missing out on potential future capital appreciation. This is actually the worst time to be selling off the JEM office.

Screen Extract of Rationale of Sales

2. Market Reaction

Strangely, the market reacted positively (August 5, 2025) to the upcoming disposal as there is a +S$8.9Mil gain over book value that LREIT may use to distribute back to unit-holders. Short term view of "get rich quick" distribution among investors seems to be driving the rally in unit price of LREIT to S$0.575 per unit (+1.77%) since the release of the divestment announcement.

Personal Thoughts and Views

As an existing unit-holder of LREIT, I am extremely disappointed with LREIT management team's decision to sacrifice a good asset with 100% occupancy just for short term gains instead of cutting losses with Milan Sky Complex. In addition, we have not seen any concrete executionary results with regard to Sky Complex where occupancy remains in the doldrum at 81.6%. 

Will Donald Trump Sink The US Economy Into Recession With His Self-Proclaimed Tariffs "Wins"?

The very controversial US July 2025 jobs report presented signs of red-flag that the US economy is inching closer to a disastrous recession. Donald Trump may have just succeed in torpedoing the US economy with his self-proclaimed victories with the trade negotiation and imposing tariffs with a base line of at least 10% against global trading partners and increasing import costs of materials and finished goods that its own US business owners will have to eventually pass through to US consumers. Inflation will certainly soar and given the worsening US job markets, Powell will need to make a difficult choice of whether to increase interest rates to stop inflation or cut interest rates to reignite the US economy engine. 

The reduction in purchasing power of US consumers will not just have a drastic impact back in US but also affect global economies such as Singapore which depends a lot on exports to thrive. Looks like we are in for a thunder storm with the erratic and unpredictable Trump policies era. The risk of US entering into a long period of stagflation is ever increasing despite the S&P500 breaching the impressive 6,000 points mark. 

Parting Thoughts- Personal

I am certainly curious as to Powell's next course of action and most folks are projecting that he will have no choice but to starting cutting borrowing rates in the next Fed meeting. If so, it maybe good to load up on more hedged US bonds and also Real Estate Investment Trust.   

NTT Data Centre REIT 7.5% Distribution Yield Sustainable Or Just A Dividend Trap?

I thought that it is quite interesting that folks on social media are having many different interpretations of the financials of NTT Data Centre REIT ("NTT REIT") and with some asserting that the NTA of this REIT will keeping dropping as it is making losses and paying out dividends from its capital. Others voiced similar concerns as me with regard to the high cocentration risk of over 30% in one single customer (suspected to be Tesla) as well as the ever weakening USD. Today we will delve deeper into the financial statements of NTT REIT to make sense of the sustainability of the high dividend yield committed by its management. From there, we will be better able to guage on the degree of margin of safety required- based on one's personal risk appetite- to start buying into NTT REIT. As at August 2, 2025, NTT REIT maekt price has dropped by <6%> from its IPO debuted price of S$1.00 per unit to S$0.94 per unit.

1. Financials Deep Dive.

First and foremost, let's address the elephant in the room. Is the financial performance signalling red-flag even before we consider the myriads of other business risks embedded in NTT REIT? For the latest year ending 31 March 2024 in the prospectus, NTT REIT is incurring a massive net loss of US$<30.8Mil>. The main reason for this reason seems to be a sudden spike in "Other Property Expenses" from US$5.8Mil in March 2023 to US$28.1Mil in March 2024. The strange part is that revenue has plummented by <21%> downwards from S$186Mil to S$146Mil despite the huge increase in "Other Property Expenses". 

2024 and 2023 Historical Profit and Loss

So is this only a one-off non-recurring loss for 2024 but in future, it will rise up from the ash? To answer this, we will need to go to take a look at the forecast provided:

Forecast FY2026 and FY2027

Well, the losses did go down from the mammoth <US$31Mil> to only <US$5.2Mil> and <US$4.9Mil> for  the forecasted FY2026 and FY2027 respectively but nevertheless, the forecasted results are not pretty and NTT REIT is apparently still in the red. This is shocking indeed as NTT REIT seems to be behaving like a Business Trust rather than a REIT. It is paying out distributions from capital and depleting its own net tangible asset over time.  

2.Revaluation of Investment Properties in The Financial Statements 

If you look at the forecast or historical financials, one will be able to see the substantial fair value revaluation for the data centres by NTT REIT. As the fair valuation accounting is subject to market conditions and I really wonder how someone can simply just forecast the future valuation for the next 2 years, we should just ignore this line item (highlighted in pink in above screenshot). Focus shall thus be on the recurring items which illustrates the routine operational Profit and Loss. So do not be misled by the abstract fair valuation which is just a non-cash item even if it looks fantastic.

Parting Thoughts-personal 

Originally, I thought that if NTT REIT corrected by 10%-20%, it may prove to be a good entry point. But based on its financial forecast for the next 2 years, its dismal financial performance will mean that NTT REIT NTA will still see losses at least for 2 more years and paying out distribution using capital. Unless there are clearer visibility on such enigmatic operating model for the data centres it manages, it maybe best to wait for the actual financial results post-IPO before accumulating some units.

How to Invest Into Singapore Real Estate Investment Trusts? My Personal Approaches to REITS.

How to Invest Into Singapore Real Estate Investment Trusts? My Personal Approaches to REITS- Please refer to below video:

Keppel Data Centre REIT Remarkable Boost in H1 2025 Earnings and Distributions- Things to Watch Out For Before Jumping In.

Keppel Data Centre REIT ("KDC") just released a remarkable 1H FY2025 results with distribution income surging 57.2% year on year and delivering a super impressive 12.8% growth in distribution per unit ("DPU") of 5.133 cents. Annualised this and the current yield will be 4.43% per annum based on the S$2.32 per unit as at 25 July 2025. Market price of KDC has rallied 5.9% within 2 short weeks as many investors were awed by the spectualar results from KDC. Still, there may be a few potential downsides that retail investors need to be mindful on, especially for those who suddenly find KDC full of prospects, and want to ride the data centre AI wave.

1. Investing in KDC Is Not As a REIT But a Growth Stock.

Then again, if we look back at the announced acquistion of the Singapore data centres by KDC in November 2024, it is already clear that DPU will increase by around 8%. Also, the newly acquired Singapore data centres have very short tenure of 25 years and I thought that even with a 4.31% distribution yield, the current market price of KDC seems very much overvalued if we benchmark to the current risk free government bonds. The distribution yield of 4.31% is thus still extremely low as unit-holders need to prepare to plough back capital into KDC at the end of 25 years for additional extension. The only pausible explantion here is that many investors are treating KDC as a "growth" stock. 

2. Overhanging Issue at Guangdong Data Centres.

There has been no news suggesting that the tenant (Bluesea Data Development) has resumed rental payments or that it has settled its arrears. So question remains whether its Guangdong data centres are now white elephants. 

The only reference I found was the AGM minutes on 15 May 2025 which only mention that 100% quarterly allowances has been made to zerorise income contributions from Guandgong DCs. Also, KDC management are adopting investment assets at fair value for its accounting treatment based on independt valuation reports. So, in event that the situation worsen, investors may have to repay loans relating to those China investments at a loss which will hit future distributions.  

Extract of AGM Minutes on Guangdong troubled DCs.

Parting Thoughts and Personal Thoughts

I am not sure whether one should keep chasing and accumlating KDC at its current sky high market valuation. Its market price is currently S$2.32 per unit as at 25 July 2025 while its NTA is only S$1.53 per unit (as at 31 December 2024) and this means that one is paying a jaw dropping premium of +51.2% over its NTA. Nevertheless, if I want to increase my investments into REITs with data centres exposure, I will probably choose Mapletree Industrial Trust followed by KDC rather than DigiCore REIT or the recently listed NTT Data Centre REIT.

NTT Data Centre REIT IPO Flop- Stuck at US$1 Per Unit On Debut

NTT Data Centre REIT (“NTT DCR”) IPO debut on July 14, 2025 was extremely disappointing. Its closing price on its first day of trading ended at a miserable US$1 per unit which was its IPO price. This is certainly unlike most of the SGX IPOs where prices usually surge by 10% on debut as many prospective investors are unable to get their hands on the shares during the IPO. 

Anyway, it maybe a blessing in disguise for many folks who are unable to get their hands on NTT DCR. I really have doubts on the sustainability of the 7.5% distribution yield as I do not think the management will maintain a 100% payout ratio for the longer term and it is getting too gimmicky.  Also, in my previous post, I have reiterated on the often forgotten point that the trust deed only permits not more than 9.8% shareholding by any investor (except for the sponsor 25% limit) which can have devastating consequences during crisis. 

Parting Thoughts- Personal View

Despite the risks as aforesaid mentioned, if the price of NTT DCR were to drop more than 10%-20%, it may serve as a good entry point (with additional safety buffer) to accumulate some units at an attractive distribution yield.

Keppel Ltd Rising From The Ash- Transformation On Target and 4.39% Dividend Yield For Waiting.

Recently, the share price of Keppel Ltd finally roared back to life after being in a limbo for the past 2 years. From its share price of S$6.87 per share as at beginning of January 2025, it has now hit an improved market valuation of S$7.74 per share as at 11 July 2025. This is an impressive 12.7% capital appreciation in 2025 alone for all retail investors. Congrats to all fellow shareholders who are holding on to Keppel Ltd and have subscribed to the revised asset light model strategy which focuses now on building up recurring income from management of investment assets. For myself, Keppel Ltd has been my best performing non-banking stock with a total gain of +S$22K (including S$6.2K of dividends) which is a +27.8% return. I had been accumulating shares of Keppel Ltd from May 2023 to November 2024. I have listed below the reasons for the sudden rise in the market price of Keppel Ltd.

1. The Piyush Gupta Effect

Personally, I think that this is the main catalyst for the recent spike in the share price of Keppel Ltd. Once Keppel Ltd announced the appointment of the ex-CEO of DBS as its deputy Chairman and non-executive independent director, the market became mad with excitement. Piyush has a stellar strong track record in transforming DBS into a leading digital bank in Singapore. His experience in driving digital transformation and innovation, as well as his leadership in navigating complex business environments, is seen as a valuable asset for Keppel as it reinvents itself as a global asset manager. 

Strangely enough, the share price of Keppel Ltd seems to have suddenly been re-rated by analysts and the entire market by this single announcement and the share price started soaring. Other supplementary reasons for its rise from the ash are as per below:

2. Strong Financial Results 

Keppel Ltd Q1 2025 net profit rose 25% year-over-year, driven by stable infrastructure earnings and a 9% increase in asset management fees-S$96 Mil. FY 2024 profit (excluding offshore & marine) increased by 5%, with data-center margins up ~45% thanks to AI and digital infrastructure tailwinds.

3. Robust Asset Monetisation

Since FY2023, the monetisation of non-core assets has been substantial: S$347 Mil in Q1 2025 alone and S$4.8 billion cumulatively since 2020. Analysts estimate another upcoming S$550 Mil asset sale pipeline in India and Singapore.

4. Recurring Revenue and Asset Manager Pivot

Keppel’s Vision 2030 strategy has rebalanced earnings towards recurring income—from 60% in 2022 to over 80% in Q1 2025 from infrastructure, fees, and data centers.

Its commitment to manage S$200 Billion AUM by 2030 is advancing, with S$88 Billion reported end-2024, and another S$4.9 Billion raised in Q1 2025.

5. Strategic Partnerships & Capital Inflows

Keppel has secured S$2 Billion in institutional investments for data centres, education, and sustainable urban renewal funds. It has also recently partnered with Asian Infrastructure Investment Bank (“AIIB”) for a S$1.5 Billion green-infra investment program across Asia.

Parting Thoughts- Personal Views on Keppel’s Outlook.

Based on its historical annual dividends of S$ 0.34 per share and its market price of S$7.74 per share as at 11 June 2025, this is an annualized dividend yield of 4.39%. For myself as a dividend investor, this is still somewhat attractive to me taking into account Keppel’s target to grow its asset under management to S$200 Billion by 2030 and I will be holding on to my remaining shares. Saying that, from a risk management perspective, I will not be adding on to my current investment into Keppel Ltd as it already made up close to 10% of my gross portfolio value and I have in fact sold off part of my holdings last month to take some profit off the table. Hopefully, Mr Gupta will be able to put in some of his magic into enhancing further growth opportunity for Keppel Ltd for all investors. Let’s wait and see! :)     

Don’t Give Too Little Credit To The People of Singapore.

I came across 1M65 Mr Loo’s latest videos of his visit to Shenzhen and Hong Kong where he came away with the proclamation that retail business in Singapore will soon be in bad shape with the opening of the RTS to Johor Bahru. In addition, worst part of all of this is that he has strangely mentioned that the people in China and Hong Kong are all more competitive and hardworking than Singaporeans but struggling in their daily lives and thereafter, he made a point that the only sole reason that Singapore economy and its people are still in better shape is due to our strong Singapore Government leadership. 

So is he saying that other governments are not as good as the Singapore government when sometimes it is not something that can be compared apple to apple especially for a gigantic and complicated country like China? Also, is it a right assertion to say that Singaporeans are not as competitive and hardworking than folks in other countries? Maybe Mr Loo has been mixing with the wrong crowd. I have known many Singaporeans who are working lots of overtime and even during the weekend on their jobs. I have also seen many Singaporeans hungrily scouting for new business opportunities and pipelines for their organization and are very highly driven. There will always be different types of people in every society of highly driven vs those that only desire a “simpler” life in China, Hong Kong and also Singapore. 

Surely, there is no need to discredit his own fellow Singaporeans just to score brownie points with regard to the SG government? Instead, is it not the competitive advantage from Tripartism (collaboration between local workers, businessmen and the SG government), which has been – and continues to be – one of the cornerstones of Singapore’s economic, social and political development and success thus far?

DBS $3 PayLah Weekly Cashback Is Back! 12 July 2025 To 27 September 2025- Don’t Miss It!

 

Hi Folks, awesome news! DBS is bringing back its popular S$3 PayLah cashback at hawker centres every Saturday for the first 160,000 people who uses PayLah to scan and pay at participating stalls from this Saturday (12 July 2025) onwards. I vividly recalled that the first cashback promotion used to be every Friday. So why did they change it Saturday instead? Rumors has it that many elderly folks were complaining about having to compete with younger working crowd and thus unable to enjoy the offer. Apparently, the move to Saturday morning will benefit more elderly folks since the younger ones will not be able to wake up early to compete given that they are busy partying late into the night to let their hair down on Friday (last working day of the week)…haha. 

Anyway, the S$3 cashback from PayLah may not be all good news for me. The last time DBS run this promotion, my favourite economic Bee Hoon stall started boosting a super long queue from 7.30am to 8.30am which rendered me too impatient to queue and buy it. Looks like I will have to settle for fishball noodle instead….haiz.

NTT Data Centre REIT IPO- Another Ticking Time Bomb- 3 Reasons to Stay Away.

There is another upcoming data centre REIT IPO on SGX by Nippon Telegraph and Telephone (“NTT”) of some of its data centres in order to raise funding of up to US$864 Mil on SGX. NTT is dangling a big fat carrot of between 7% to 7.5% annual distribution yield to attract investors. One of the cornerstone investors is our own Singapore sovereign wealth fund, GIC which invested US$100 Mil. Nevertheless, my personal view is that NTT data centre REIT will just be another ticking time bomb and I will be staying far away from this REIT for 3 main reasons:

(Please click here for those who preferred the You-Tube version)

1. Handicapped Shareholder/Unitholder Structure in Trust Deed Doomed for Failure.

This is the part that many retail investors got ensnared. All investors can only hold up to 9.8% holdings in NTT Data Centre REIT (with the exception of Sponsor who can hold up to 25%). I have written it many times on the red flag of the exemption on withholding tax for crafting US properties as a REIT structure.

Extract of the restriction on shareholding

Basically, our global economies will go through market cycles. During economic crisis or crisis caused by the REIT itself, the REIT cannot save itself by rights issuance exercise because it will breach the trust deed limitation of 9.8% for individual shareholding. So the banker or the sponsor cannot undertake unsubscribed excess rights which will mean an immediate violation of its own trust deed as well as US tax transparency rule for REIT holdings. Look at what happened to US Commercial Office REITs of MUST, KORE and PRIME on SGX which are unable to do rights issuance and you will understand why they have to do either a fire sales of assets during crisis and/or stop paying out distributions to save itself. 

2. Over Concentration Risk of Key Tenant Making Up 31.5% of Monthly Base Rent.

There is one major tenant, with only a triple B credit rating, which makes up a significant 31.5% overall in NTT Data Centre REIT monthly rental income. If there are defaults, a huge chunk of “stable” rental income distribution to unit-holders will be gone with the wind. Look at what happened to DigiCore REIT and one will understand the impact.

If we are to do an online search on the mysterious identity of this major automotive tenant, 2 names came up with BBB S&P credit rating, that is, either Tesla or General Motors. Both are not exactly in a good financial state if you know what I mean. 

3. Forex Risk- Most of the Assets Are Located in US.

4 out of the 6 injected properties are based in the US and this current data centre REIT is also priced in USD. This will mean a forex risk to SG investors. I am not exactly sure whether this is the right time to be vested in so much US assets especially with the crazy antics by Donald Trump. 

Parting Thoughts- Personal Views

Interestingly, the sponsor has highlighted the low 35% leverage ratio will help NTT Data Centre REIT expand in future. But as alluded to Point 1 above, NTT Data Centre REIT most likely is destined for private placements route  for future acquisition. The problem with such REIT structure is that it can only raise funds from existing unit-holders during good times. During crunch times, retail investors will be faced with severe dilution as the sponsor and management will have to turn to private investors to raise fundings. I thought that folks should look at Mapletree Industrial Trust or Keppel Data Centre REIT if they want to be vested in the data centre business.

Donald Trump Whacked Elon Musk- Tesla Ouch!

Donald Trump has threaten to take away EV subsidies after Elon Musk went berserk and wanted to start a new political party (The America Party) due to the Big Beautiful Tax Cut Bill. Consequently, Tesla dipped close to 6% during early trading. Analysts have mentioned that up to 40% of Tesla’s profit may be at stake if the regulatory ground shift under Donald Trump. Donald Trump has once again proved himself to be the King of Mayhem if he succeed in throwing the wrecking ball at Tesla and other Musk’s businesses. 

So why did Elon Musk supported Donald Trump with so much political donation in the first place? Haiz…..what a mess for the stock market.