Singapore REITs 4Q23 Round-up - UOB Kay Hian 2024-03-13: The Quarter Of Hard Knocks

• For the 21 S-REITs under our coverage, 5 were above expectations with eight below expectations. The hospitality sub-sector registered the strongest NPI growth, averaging 13% y-o-y. We saw positive rental reversions across retail, office and logistics properties.
• Maintain OVERWEIGHT on REIT sector. Focus on blue chip S-REITs with resilient balance sheets.
• - Read this at SGinvestors.io -
• Frasers Centrepoint Trust (SGX:J69U),
• Far East Hospitality Trust (SGX:Q5T),
• Frasers Logistics & Commercial Trust (SGX:BUOU) and
• - Read this at SGinvestors.io -

Retail: Steeper recovery from downtown malls.

• Most downtown malls achieved positive double-digit rental reversion, such as Suntec City Mall (4Q23: +25.7%) and Mapletree Pan Asia Commercial Trust (SGX:N2IU)'s VivoCity (3QFY24: +14.2%), due to recovery in tourism and back-to-office momentum.
• CapitaLand Integrated Commercial Trust (SGX:C38U)'s retail leases saw pick-up in positive rental reversions by 1.2ppt q-o-q to 12.3% in 4Q23 (downtown: 11.1%, suburban: 13.0%).
• Lendlease REIT (SGX:JYEU) also experienced strong positive rental reversion of 15.7% in 2QFY24 (313@Somerset: >20%, Jem: 10%).
• Unfortunately, occupancy at Suntec City Mall eased 3.1ppt q-o-q to 95.6% in 4Q23 due to the closure of Pure Fitness and Pure Yoga on 8 Oct 23.

Office: Continued resiliency.

• Read more at SGinvestors.io.

Jonathan KOH CFA UOB Kay Hian Research | https://research.uobkayhian.com/ 2024-03-13 SGinvestors.io

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