It appears that Frasers Centrepoint Ltd (SGX: TQ5) has found some success in repositioning itself within the property industry. The company started out with a business that dealt predominantly with property development. But it has been actively diversifying its revenue base to include more recurring sources such as rental income from investment properties and fees from asset management.
With the listing of Frasers Logistics and Industrial Trust, Frasers Centrepoint now has a full spectrum of real estate funds under its management. The company has a retail real estate investment trust (REIT), a commercial REIT, a hospitality trust, and an industrial REIT (that would be Frasers Logistics and Industrial Trust) in its care right now. The company holds significant stakes in each of the trusts it’s managing.
Earlier this month, Frasers Centrepoint also announced a change of guard in its senior management team. Lim Ee Seng, who has been the company’s chief executive since 2004, would be stepping down at the end of September this year. He would then be moving on to become a senior adviser to the TCC Group, Frasers Centrepoint’s main shareholder.
Interestingly, Panote Sirivadhanabhakdi, has been appointed as the new chief executive of Frasers Centrepoint. In order for him to take on the role, he has resigned from his current post as chief executive of Univentures Public Company Limited, a Thailand-listed real estate company.
It is worth noting that Frasers Centrepoint is majority-owned by the Sirivadhanabhakdi family; the TCC Group is their investment vehicle. Could the appointment of a member of the Sirivadhanabhakdi family to head Frasers Centrepoint be a sign that the family is going to put more emphasis on the company going forward?
Things seem to be going well for Frasers Centrepoint Trust. With a recurring revenue base and the listing of Frasers Logistics and Industrial Trust, the company can start paring its debt level (it has a net debt to equity ratio of 87% as of 31 March 2016) and continue growing its business in a more sustainable manner.
For more investing insights and important updates about the stock market, sign up to The Motley Fool Singapore's free weekly investing newsletter, Take Stock Singapore. Written by David Kuo, it can help you grow your wealth in the years ahead.
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 writer Stanley Lim owns shares in Frasers Centrepoint Ltd.