A few weeks ago, Soilbuild Business REIT announced a preferential offer, and this came as no surprise to me, as they needed cash to purchase a Bukit Batok property from their sponsor, despite after claiming 18 months’ worth of rental deposit from Technics Oil & Gas when they went into judicial management. Given the current state of the oil & gas sector, it appears that they have wisely pared down their exposure to the industry, and it looks like the property purchase is a decent compromise in risk-taking and diversification. Thus, I am convinced of the ability of the management, and have decided to take up excess units in the preferential offer.
However, as wise as Soilbuild’s management are, the fact that they exercised their muscles to eat up the $11.8 million deposit which a cash-strapped company desperately needs, shows that they are more concerned with their bottom line than with relations with their tenants. Perhaps in the future, oil & gas companies might think twice to rent from them. I feel that what’s happening with the two companies right now mirrors the current state of Singapore’s economy – the head vs the heart. Should we pursue growth at all costs, or should we slow down a little, and take care of our fellow citizens? I’ll leave this dilemma for you to ponder, dear readers.
