SINGAPORE (Jan 13): A second real estate investment trust has started a cornerstone roadshow this year. United Hampshire US REIT is looking to lodge its prospectus on Feb 12, register on Feb 24, and list on Singapore Exchange at a yield of 6.5% to 7% on March 6.

United Hampshire US REIT is a US grocery-led shopping and storage REIT with 18 retail assets and four self-storage assets with 3 million sq ft of net lettable area. The portfolio is located largely in the states of New Jersey, New York, North Carolina, Florida and Massachusetts.

Valuation of the initial portfolio is around US$582 million ($785 million) and the initial gearing is likely to be 37.1%, funded mainly by long term debt. The effective tax rate is around 3.5%.  

Portfolio occupancy is around 95%. The weighted average lease to expiry (WALE) is long at 8.4 years, with strong credit anchor tenants such as Walmart, BJ’s Wholesale Club, Lowes Company, Ahold Delhaize and Wakefern Food Corp.

US grocery and self-storage assets are meant to be cycle agnostic, performing well in both periods of economic expansion and distress. Self-storage net operating income growth has risen by 4.2% a year over the last 24 years, outpacing other sectors by 200 basis points.

United Overseas Bank and UOB Kay Hian are lead bookrunners. UOB Kay Hian is proposing margin financing for Hampshire investors, with an estimated leveraged yield of 15.6% a year.