Eagle Hospitality Trust to sink or swim with Temasek Holdings?
What a bad start for a REIT that barely got listed for six months! Debut in SGX only in May 2019, US pure-play REIT is facing some sort of crisis lately. At the centre of the storm is an astonishing article by The Edge Singapore revealing toxic inspection reports and a letter from the City of Long Beach to Urban Commons, sponsor of Eagle Hospitality Trust. In that letter, it was alleged that Urban Commons failed to meet obligations under The Queen Mary ground lease to make certain repairs required under the lease agreement.
The Queen Mary is one of the 18 properties held by Eagle Hospitality Trust, with valuation of USD159.4 million. Only Holiday Inn Resort Orlando Suites Waterpark, with valuation of USD162.8 million, carries a higher valuation. In this regard, The Queen Mary is one of the key assets of Eagle Hospitality Trust and the loss of this asset would likely have significant impact to Eagle Hospitality Trust.
Eagle Hospitality Trust in dark chapter
The 23 October article by The Edge Singapore spooked the hell out of investors and sent the unit price spiralling out of control. The counter fell from USD0.65 to USD0.55, prompting the manager to swiftly seek clarification with the sponsor.
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