Taking a look at StarhillGbl Reit

Positive

- almost 91% Singapore office occupancy rate with committed lease in 3Q (01/2018 to 03/2018) above market rate but below expiring rents.

- China property handed over to Markor International Home Furnishings Co. with  periodic step-up rent structure. Renovation to finished in 3Q. I assume no rent is collect yet as in FY 16/17, the property incur a loss.

- Assuming the  China property to have the same NPI as in FY15/16 of 2.6 million. It will contribute 0.12cents to DPU.

- Australia Plaza Arcade with its 41% expansion on AEI of 2000 sqm, of which 1200 is committed to anchor tenant UNIQLO's first Australia store. 

- If the AEI GLA if fully leased out and base on FY16/17 NPI from the property, NPI will increase by 0.96million (41% more GLA), which will contribute about 0.05cents to DPU.

- A total of 0.17cents upside to DPU a year or 0.042cents a quarter.

Negative

- Huge lease expiry next fiscal year 18/19. (SG properties)

- Plaza Arcade NPI for FY16/17 is 2.4 million which a 33% drop from FY15/16 although occupancy rate has risen from 74.5% to 94%(Ouch). 

- Can see that Plaza Arcade is doing very badly, property value is below purchase price.

Comparison

Only13% of StarhillGbl Reit's revenue are from offices, hence I will not compare it with Mapletree Commercial Trust nor Suntec Reit.


Price Base on 14/3/2018

	StarhillGbl Reit	CapitaMall Trust	Fraser Centerpt Trust
2013	6.85%	4.08%	4.97%
2014	7%	5.22%	5.09%
2015	7.1%	5.48%	5.28%
2016	7.13%	5.48%	5.36%
2017	6.7%	5.48%	5.41%
PB Ratio	0.78	1.06	1.1

   
StarhillGbl Reit  perform badly for the FY16/17 while CapitaMall Trust is stagnant while Fraser Centerpt Trust continue to grow.
 
Base on StarhillGbl Reit 1H result, yield for 17/18, estimate to have a drop in 7.4% or 0.36 cents to 4.56 cents in DPU. Yield should decrease to below 6.4%.

Conclusion

A estimated 0.17cents increase in DPU from AEI and new tenants seem lackluster and would not cover the 0.36 cents drop.

Assuming I can buy CapitaMall Trust and Fraser Centerpt Trust at NAV, I can get a yield of 5.8% - 6%. Therefore, it would be worthwhile to collect StarhillGbl Reit when yield is > 6%. With the dropping DPU, will only consider adding with a MOS near 6.6% yield or less than 0.70.