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Brexit Is Not Scaring This Singapore Company Away From The UK

Last June, the citizens of the United Kingdom voted to leave the European Union. Earlier this week, the country’s Parliament approved a bill that would allow Prime Minister Theresa May to trigger Article 50. So, Brexit is happening.

Most commentators are expecting the exit negotiations to be a massive affair. It is unclear how the “new” UK would look like after it leaves the European Union and the uncertainties may be deterring some investors from investing in the UK. However, there are some companies that clearly have a different view.

City Developments Limited (SGX: C09), one of the largest property companies in Singapore, announced yesterday that it has acquired a new piece of land in South London for about S$103.2 million.

The plot of land, which has an area of 0.65 hectares, has a gross development value of around S$395.2 million. It is just 1km or so away from the massive US$13.4 billion Battersea Power Station redevelopment project that’s led by Malaysian property companies SP Setia Bhd (KLSE:8664.KL) and Sime Darby Bhd (KLSE:4197.KL).

City Developments plans to redevelop the site into a residential development with six residential buildings. The company also mentioned that the development would complement the Battersea Power Station project.

The purchase shows that City Developments is still optimistic about the future of the UK. It also highlights to investors that pockets of opportunities can still be found in the country despite uncertainties with the macro situation there.

City Developments counts the UK as one of its key overseas markets and the latest acquisition would add to the portfolio of properties it already has in the country. With the purchase, the company would have invested a total of around S$902.3 million in the UK.

City Developments is currently trading at 10.7 times trailing earnings and offers a 1.3% dividend yield.

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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 does not own shares in any company mentioned above.