DBS Bank, Singapore's most prolific arranger of structured property-backed deals, has just issued its fourth quasi-securitization in the domestic market this year.
The S$200 million (US$166.5 million) transaction is backed by cashflow from the leases of Century Square Shopping Centre. The originator, First Capital Corporation, sold the property to an SPC called Pemberton Ltd., which in turn issued three tranches of seven-year bonds: tranche A was S$100 million and priced at 6 and 1/16%, tranche B was S$70 million and priced at 6 and 7/8%, and tranche C was S$30 million and priced at 6 and 1/8%.
As is typical with Singaporean CMBS-type deals, the transaction was unrated and placed in the domestic market. Over-collateralization was provided by a First Capital 50%-owned joint venture, which acquired all of Tranche C and may sell it on at a later date. A call option will allow the joint venture to purchase the property from the SPC at the prevailing market price three and four years from the issue date, added a banker at DBS.