I will be comparing Sabana and Cambridge Reit in this post.
Both are smaller reits with weaker sponsors.
Sabana and Cambridge has similar Master Lease to Multi-tenant mix.
Sabana is 59% to 41%
Cambridge is 56.5% to 43.5%
Theoretically, Sabana with its higher Master Tenant Lease, should have a lower operating expenses. But given the difference in insignificant, lets not be too harsh.
Cambridge's NPI to revenue is 78%
Sabana's NPI to revenue is 72%
Cambridge managed "renewed approx 300,000 sq ft of leases in 3Q2014, amounting to 1.6 million sq ft of leases YTD2014 with positive rental reversion", I cannot find similar statements in Sabana's presentation. Maple is enjoying positive rental reversion too, although it might not be in the same league. Sabana's sub-tenants have been in a increasing trend, although it is scant console to anyone with falling distribution, but it provide hope. That hope is not very hopeful now, with sub-tenants reducing for the first time. (only 1 la, no alarm, but if you are thinking they are going to fill it up quickly... ...)
Coincidentally, Both have Gross revenue of 25 mio, but Sabana operating expenses is 2 mio more than Cambridge despite Cambridge having more than twice number of buildings to manage. Do not tell me economical of scale, given gross revenue is the same, if anything, concentration of revenue in one building should reap economic of scale, just like the shipping companies are building bigger and bigger ship to bring down cost per container.
Both have weak refinancing schedule, with refinacing spread out over 5 years for Sabana, and effectively 3 years for Cambridge, with 2016 having a particularly high sum of loans due to renewal. If Cambridge can break down that loan over more years, it will have a more appealing profile. Both are unable to use 1 year of NPI to offset most years of refinacing. (Unlike big boys like Maple Industrial and Ascendas Industrial)
Sabana all in cost of loans is 4.1%, whereas Cambridge is 3.69%
Sabana has 2 Master leases under negotiation and 1 already concluded to be converted into muti-tenants.
I wonder what Tong Jingguan see in Sabana?
Maybe the Changi Warehouse purchase will be a good idea? Since it is 100% occupied, but there is no info and when the Master lease will expire.
I will compare the big boys, Maple and Ascendas when Ascendas announced its results later.