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Portfolio quality and manager ability more important than size for AA REIT

Goola Warden
Goola Warden8/13/2018 07:30 AM GMT+08  • 9 min read
Portfolio quality and manager ability  more important than size for AA REIT
SINGAPORE (August  13): AIMS AMP Capital Indus­trial Real Estate Investment Trust (AA REIT) announced in May that it was undertaking its second speculative build. The REIT is not acquiring new land as the speculative build is for the redevelopment of a
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SINGAPORE (August 13): AIMS AMP Capital Indus­trial Real Estate Investment Trust (AA REIT) announced in May that it was undertaking its second speculative build. The REIT is not acquiring new land as the speculative build is for the redevelopment of a property within its portfolio. AA REIT’s manager is not obsessing about size and has been particularly cautious about acquiring new property and asking its unitholders for money.

George Wang, chairman of AA REIT’s manager, is cognisant that growth at any cost is damaging to unitholders. “There’s a Chinese saying, ‘you can only take one bite at a time.’ It’s the same with business. When you buy an asset, you need to understand the asset and if it’s a good fit for the portfolio. You need to digest it first and then buy another one.”

AA REIT’s last acquisition was in 2014, when it acquired a 49% stake in Optus Centre for A$184.4 million, or the equivalent of $205.3 million. The manager last raised equity of $100 million through a rights issue in 2014. In November last year, it did a placement to raise $55 million.

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