GLP

GLP: Credit Suisse maintains Outperform with TP $3.15. Private equity and real estate news agency, PEI PERE reported that GLP is raising its first China-focused real estate fund with as much as US$1.5b. While GLP has denied entering into any binding agreement presently, it is still an option mgt will evaluate. CS assumes increment of 50% to existing mgt fee base and a 15x P/E multiple, might add ~2% to RNAV. Also, this would be positive for ROEs, as it should lighten the capex requirement for future developments. The house also believes such capital recycling would be seen positively by market, evident from the positive implication of last year's GLP J-REIT exercise. The house also highlights the increase of leasing momentum corroborating above buy arguments that GLP is a proxy to the defensive logistics sector, with growth kicker from developments.