Global Logistic Properties Ltd Leads the Market Lower for the Week

The Straits Times Index (SGX: ^STI) slumped from 2,918 points, seen last Friday, to end this week at 2,859 points, a fall of 2%.

Of the 30 index components, 22 were in the red, 6 were in the green while two – StarHub Ltd. (SGX: CC3) and Hutchison Port Hldg Trust (SGX: NS8U) – ended the week flat.

Provider of modern logistics facilities, Global Logistic Properties Ltd (SGX: MC0), or GLP for short, fell the most amongst the blue chips, tumbling 5.2% to S$2.00.

On Monday, the firm announced that it had signed leases with a total land area of 69,000 square meters, with three industry leaders in China, namely,, Best Logistics and STO Express. The first two companies happen to be GLP’s 10 largest customers by leased area in China. All three firms “will utilize the space to cater to increasing demand driven by growing domestic consumption”.

On the same day, GLP also made public that it had agreed to grant a loan of around US$311 million to China Holdco. Around 66% of the company is held by GLP, through its wholly-owned subsidiary, CLH Limited.

The loan will be used by China Holdco to pay for GLP’s 15.5% equity investment in China Materials Storage and Transportation Development Company (CMSTD), under the strategic partnership arrangement between CMSTD and the GLP.

On a side note, my Foolish colleague, Ser Jing, pitted the logistics provider against another firm in the same industry, Singapore Post Limited (SGX: S08). You can check out his post here.

Another property company that didn’t perform well for the week was City Developments Limited (SGX: C09), or CDL. Shares of the property developer dropped 2.5% to S$7.35.

CDL announced this week that it had entered into a contract to buy a freehold site in Mortlake, London, which is owned by Stag Brewery, for £158 million (around S$335 million). Completion of the acquisition is expected to be finalised by the first week of next month.

The space, which spans 89,031 square metres, has “tremendous potential”, according to CDL. It will be redeveloped into a major residential site, and will house a new school, hotel and other employment and leisure areas. The latest acquisition will be CDL’s eighth property purchase in the United Kingdom.

On the other hand, the biggest winner in the index was Ascendas Real Estate Investment Trust (SGX: A17U). Units of the business space and industrial trust rose 3.1% to S$2.36.

Last week, it announced that it had completed the acquisition of 26 logistics properties located in Australia, sealing the REIT’s foray into the Australian market. Ascendas REIT has also become Australia’s eighth largest industrial landlord, as noted by Chin. To find out more about the acquisition, you can click here too.

The SPDR STI ETF (SGX:ES3), which is a proxy for the Straits Times Index, is now trading at 11.6 times its trailing earnings and yields 3.3%.

To keep up to date on the latest financial and stock news, sign up for a FREE subscription to The Motley Fool's weekly investing newsletter, Take Stock Singapore. It will teach you how you can GROW your wealth in the years ahead. Also, like us on Facebook to follow our latest hot articles.

The Motley Fool's purpose is to help the world invest, better.

The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore contributor Sudhan P doesn’t own shares in any companies mentioned.