Frasers Centrepoint Trust - OCBC Investment 2023-01-30: Good Strategic Fit, But Watch The Borrowing Costs

Frasers Centrepoint Trust - Good Strategic Fit, But Watch The Borrowing Costs

  • Frasers Centrepoint Trust's 1QFY23 (Oct-Dec 2022) retail portfolio committed occupancy rose 0.9 percentage points (ppt) q-o-q to 98.4%.
  • Cost of debt increased 50 basis points (bps) to 3.5%.
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Solid and resilient operating metrics

  • Frasers Centrepoint Trust (SGX:J69U) provided a business update for 1QFY23.
  • Retail portfolio committed occupancy rate increased by 0.9 ppt q-o-q to 98.4%, and this was broad-based across its assets. The biggest increase came from Changi City Point, which registered an improvement of 4.1 ppt to 97.8%. Century Square was the only mall with an occupancy lower than 90% (88.7%), but Frasers Centrepoint Trust is in negotiations with a prospective tenant for ~8% of the mall’s net lettable area (NLA), which is an anchor space.
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  • Frasers Centrepoint Trust highlighted an asset enhancement initiative (AEI) for Tampines 1, which would entail ~8k square feet of additional NLA due to various bonus gross floor area (GFA) schemes. Management estimates a return on investment of 8%, based on an enhancement cost component of S$31m. The AEI would commence in phases from 2Q23 to 3Q24, with the mall remaining open for operations.

Jump in average cost of debt to 3.5%

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Above is the excerpt from report by OCBC Investment Research.
Clients of OCBC Securities may be the first to access the full report in PDF @

OCBC Research Team OCBC Investment Research | 2023-01-30

Read also OCBC's most recent report:
2024-04-26 Frasers Centrepoint Trust - Buoyant Operating Metrics.

Previous report by OCBC:
2024-01-23 Frasers Centrepoint Trust - No Near Term Refinancing Needs.

Price targets by 5 other brokers at Frasers Centrepoint Trust Target Prices.

Listing of research reports at Frasers Centrepoint Trust Analyst Reports.

Relevant links:
Frasers Centrepoint Trust Share Price History,
Frasers Centrepoint Trust Announcements,
Frasers Centrepoint Trust Dividends & Corporate Actions,
Frasers Centrepoint Trust News Articles


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