Germany's I REIT Global said to plan $375 mil Singapore IPO

I REIT Global Management, backed by office buildings in Germany, is preparing an initial public offering in Singapore that may raise about US$300 million ($375 million), people with knowledge of the matter said.

The property trust has received listing approval from the Singapore exchange and is testing investor demand for the sale, the people said, asking not to be named as the process is private. Shanghai Summit Property Development, led by Chinese real-estate tycoon Tong Jinquan, may buy more than half of the IPO, they said. Calls to Shanghai Summit’s main office went unanswered.

REITs and business trusts were the biggest fundraisers in Singapore’s IPO market in the past year, according to data compiled by Bloomberg. The FTSE Straits Times Real Estate Investment Trust Index, comprising 32 trusts, has risen 6.6% this year while the benchmark Straits Times Index has advanced 3.6%.

Frasers Hospitality Trust plans to offer a dividend yield of 7% for the 2015 financial year when it starts selling units in its IPO next week, people with knowledge of the matter said today. OUE Commercial Real Estate Investment Trust raised US$274 million from a Singapore IPO in January, data compiled by Bloomberg show.

Tong bought more than half the stock in Viva Industrial Trust’s US$294 million offering in October. He also invested in Perennial China Retail Trust’s Singapore IPO in 2011, and sold his stake almost a year later for an undisclosed price. Viva Industrial is up 1.9% from its offer price.

DBS Group Holdings and Barclays Plc are managing the offer, the people said. Elaine Lim, a Singapore-based spokeswoman for the trust who works for Citigate Dewe Rogerson, declined to comment.