Investment Proposal

Topics: Investment, Net present value, Singapore Pages: 10 (2868 words) Published: April 14, 2013
Section Two To be completed by the Professor I lecturer
Note below your comments on content, structure and presentation. Comments on specific points should be written on the assignment. Enter grade out of 20 on the bottom of this page. Please indicate whether this is a first or a second grading. □ First grading…□ Second grading

Professor's name
Date received Date returned to student
Section One To be completed by the studentPlease tick as appropriate
Name (s): Loga Subramani Veeramani SudharsanMBA FT □ MIB □ Undergraduate □
MBA PT □ MSc □ Diploma □ Certificate □
Specialization International Business
Intake no MIB Spore 7
Student ID Number (s) : 122866Grenoble Main Campus □ Off site (state which one) □
Subject: Corporate Finance Singapore…………………………… Assignment □ Oral Presentation □ Exam □
Title Investment Appraisal Report
I hereby declare that the attached assignment is my own work and understand that if I am suspected of plagiarism or other form of cheating; my work will be referred to the Disciplinary Committee which may result in my exclusion from the program.

Signature Loga Subramani Veeramani SudharsanDate

Frasers Centrepoint Trust

Acquisition of YewTee Point Mall

L.Veeramani Sudharsan
Master in International Business 7 (2012-14)

Table of Contents| Page no|
1. Introduction| 5|
2.1. Objective of the Investment Appraisal Report| 5| 2.2. Basic Information of YewTee Point Mall| 5|
2.3. Rationales of the acquisition| 5|
2. Business Overview| 7|
3. Market Overview| 8|
4. Financial Information| 9|
5. Investment Appraisal| 12|
6.4. Net Present Value| 12|
6.5. Profitability Index| 12|
6.6. Return on Capital Employed| 13|
6.7. Property yield| 13|
6. Non-financial information| 14|
7.8. Risk factors| 14|
7.9. Singapore economy| 14|
7.10. Retail Sales| 14|
7.11. Retail Rent and Supply| 15|
7.12. Inflation| 15|
7. Limitation| 15|
8. Conclusion| 15|
9. References| 16|
10. Appendix| 17|

1. Introduction
1.1. Objective of the Investment Appraisal Report
The objective is to critically evaluate the feasibility of the investment project by Frasers Centrepoint Trust (FCT) employing appropriate investment appraisal techniques, taking into account financial and non-financial factors and place recommendations with suitable justifications. 1.2. Basic Information of YewTee Point Mall

YewTee Point Mall is a 2-storey suburban retail mall comprising one basement and one storey above ground with a net lettable area 72,948 sq ft. The mall is located in the town centre of Yew Tee housing estate and is adjacent to Yew Tee MRT station. YewTee Point’s key tenants include NTUC Fairprice, Koufu (food court), Toast Box, Subway and Xin Wang Hong Kong Café, Boon Lay Power Nasi Lemak, SOD Café and Shihlin Taiwanese Snack. The mall also offers beauty, healthcare, fashion, lifestyle and educational services to cater to the shoppers’ needs. YewTee Point draws shoppers from the surrounding Yew Tee housing estate, school, military camps and the nearby industrial estate. Total visitor footfall in FY2010 was 11.4 million, translating to an average of 950,000 visitors per month. (Frasers Centrepoint trust, Circular, 7 Jan 2010)   1.3. Rationales of the acquisition

1. The main benefit of YewTee point is its strategic location in the town center of Yewtee housing estates with MRT stations very close by. 2. YewTee...

References: Atrill, P. and McLaney, E. (2011) Accounting and Finance for Non-Specialists. 7th edition: Prentice Hall Financial Times
Pike, R
Singapore data, 2012, Government of Singapore, available at [accessed November 11, 2012]
NPV = (11,448,000 x PVIFA (3, 15)) – 127,700,000
= (11,448,000 x 11.9379) -127,700,000
Other property expenses | (1872) |
Property expenses | (3096) |
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