GLP

GLP: DBS issues note maintaining Buy but increases TP to $2.31 from $2.29 on JV acquisition of Japanese assets. House is of view this demonstrates GLP’s ability to find high quality JV partners as well as both increase its presence in Japan and build its income source. Price acquired was 7.5% below independent valuation. Its attributable GFA is est to expand to 9.7m sqm valued at US$10.8b with 70% of value in Japan. GLP’s longer-term strategy is to lower exposure in Japan by either spinning off its assets to a J-Reit or sell and recycle capital into China.

This new acquisition is expected to boost FY13F earnings by 13%with potential for organic growth and redev opportunities. GLP’s see through gearing is expect to rise from 23% to 25%. House increases TP based on revaluations (parity to RNAV).