Daniel Lee

Nov 1517 min read

Singapore REITs Business Updates For 3rd Quarter 2024

Here are the REITS that have reported their earnings or business updates for the third quarter of 2024.

General Findings:

Singapore Dollar remained strong which resulted in further foreign exchange losses for REITs with offshore properties.
Singapore retail properties exhibited strong performances with continued high occupancy and positive rental reversion. Tenant sales, however, have shown signs of weakening as consumer sentiment becomes more cautious.
Singapore Prime offices' demand remained healthy with robust rental reversions recorded in Q3 2024
Singapore industrial properties remained healthy with robust rental reversion recorded in Q3 2024 as the manufacturing sector bounced back in the third quarter
China Mall continues to see improvements in tenant sales and shopper traffic
China logistics and business parks continued to exhibit weakness with lower occupancy rates and negative rent reversion.
The United States Office sector remained stable with a relatively unchanged occupancy rate of around 86.2%. As companies are mandating a 5-day work from the office, the office sector is expected to benefit from the shift.
Global demand for data centres remained strong with high double-digit growth in demand.
Global pent-up post-pandemic travel demand normalized across most markets which translated to a stable operating performance in the third quarter of 2024 as opposed to the previous growth rates that we’ve seen in the past few quarters.

You can skip to the respective type REITs that you are interested in or Ctrl + F your way to the desired reit:

Healthcare REIT
Hospitality REIT
Retail REIT
Office & Commercial REIT
Industrial REIT

You can assess my independent analyst report on the individual counters via my telegram

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Healthcare REITs

Parkway Life REIT

Announced their 3Q 2024 business update of which:

What is positive:

Natural hedge has negated the top-line FX impact and preserved bottom-line growth as DPU increased by 2.8% despite a decline in top line revenue.
Announced the expansion of their mandate and made an active move into the European market starting with France.

What is negative:

Gross revenue declined by 2.2% and Net property income declined by 2.1% Y.O.Y. mainly due to depreciation of JPY, partially offset by contribution from properties acquired in 2024

Any changes in stance: No adjustment nor changes in fundamental view.

First REIT

Announced their 3Q 2024 business update of which:

What is positive:

In local currency terms, Rental and Other Income increased 4.4% Y-O-Y for properties in Indonesia, and 2.0% Y-O-Y for nursing homes in Singapore, while nursing homes in Japan remained stable

No refinancing requirements until May 2026

What is negative:

In SGD terms, both Gross Rental Income (-5.3%) and Net Rental Income (-6.0%) experienced a decline due to FX losses
9M 2024 DPU of 1.78 Singapore cent was 4.3% lower Y-O-Y due to currency translation impact
The gearing ratio increased from 38.7% to 39.3% at the back of lower asset valuation

As at 30 September 2024, the security deposit from Siloam for the three MPU Hospitals MLAs for its proportion of the rent amounted to approximately S$4.3 million

Any changes in stance: Adjusted forecasted FY2024 DPU growth from -3% to -4%. Updated the calculated intrinsic value calculation. No other changes in the fundamental view.

Hospitality REITs

Acrophyte Hospitality Trust

Announced their 3Q 2024 business update of which:

What is positive:

What is negative:

On the same-store basis, gross revenue and NPI declined 1% and 3.2%, respectively, underscoring the impact of the AEI projects.
RevPAR decreased by 1.1% at the back of lower occupancy which is partially offset by higher ADR

Any changes in stance: No adjustment nor changes in fundamental view.

CapitaLand Ascott Trust

Announced their 3Q 2024 business update of which:

What is positive:

Gross profit rose 8% year-on-year (y-o-y) with higher RevPAU (+3%) on sustained lodging demand
On a same-store basis, excluding acquisitions and divestments between 3Q 2023 and 3Q 2024, gross profit was 2% higher y-o-y due to stronger operating performance
Portfolio reconstitution initiatives yielded positive results as acquisitions, completed asset enhancement initiatives (AEIs) and interest savings from the repayment of higher-interest debts with divestment proceeds mitigated the impact of income lost through divestments and ongoing AEI

What is negative:

Any changes in stance: No adjustment nor changes in fundamental view.

CDL Hospitality Trust

Announced their 3Q 2024 business update of which:

What is positive:

Revenue increased by 2.9% while NPI increased by 1.0% year-on-year. Improvement was recorded in almost all the portfolio markets, except the UK market which was flat and the New Zealand and Maldives market which was down yoy as the pent-up post-pandemic travel demand normalised across most markets
Expanded presence in the UK with the acquisition of a freehold property, consisting of Hotel Indigo Exeter and two retail units, for £19.4 million (~S$33.2 million). The acquisition is expected to be accretive when stabilised.

What is negative:

Gearing increased from 36.7% to 38.8% while Weighted Average Cost Of Debt increased from 4.2% to 4.4% over the last quarter.

Any changes in stance: No adjustment nor changes in fundamental view.

Far East Hospitality Trust

Announced their 3Q 2024 business update of which:

What is positive:

Gross Revenue for 3Q 2024 increased 0.4% year-on-year with growth from the serviced residence and commercial premises. The hotel segment registered a -1.4% which dragged the overall performances.
No refinancing requirement in 2024

What is negative:

Net property income decline by 1.8% on the back of lower revenue and higher property taxes

Any changes in stance: No adjustment nor changes in fundamental view.

Frasers Hospitality Trust

Announced their FY 2024 business update of which:

What is positive:

Gross revenue and net property income rose 7.6% and 2.1% year-on-year respectively bolstered by improvements in the Europe, Malaysia and Japan markets, as well as maiden contributions from the retail component of ANA Crowne Plaza Kobe
Portfolio valuation increased by 2.9% to approximately S$2.0 billion

What is negative:

Cost of borrowing increased to 3.50% from 3.10%
DPU decreased by 7.5% at the back of higher borrowing costs and tax expenses

Any changes in stance: No adjustment nor changes in fundamental view. I’ll be updating my analyst report on FHT once their annual report is out.

Retail REITs

BHG Retail REIT

Announced their 3Q 2024 business update of which:

What is positive:

What is negative:

Any changes in stance: No adjustment nor changes in fundamental view.

CapitaLand China Trust

Announced their 3Q 2024 business update of which:

What is positive:

The mall portfolio is performing well

What is negative:

Gross revenue (-3.4% yoy) and Net Property Income (-5.1%) decreased at the back of weaker logistic and business park performances coupled with the absence of contributions from CapitaMall Shuangjing and CapitaMall Qibao.
Gearing increased to 41.6% from 40.8% while the Average Cost of Debt increased to 3.55% from 3.49%.

Any changes in stance: No adjustment nor changes in fundamental view.

Frasers Centrepoint Trust

Announced their FY 2024 business update of which:

What is positive:

Robust operating performance with retail portfolio committed occupancy at 99.7%; average rental reversion at +7.7%; as well as higher shopper traffic and tenants’ sales
Portfolio’s committed occupancy grew to 99.7% and average rental reversion stood at 7.7% at the back of higher shopper traffic and tenant sales
Higher appraised valuation of the retail portfolio (+1.2% y.oy.) with no change in valuation capitalisation rates
Health of the balance sheet improved as the gearing ratio dropped to 38.5% from 39.1% q.o.q

What is negative:

DPU decreased by 0.9% at the back of the income loss from the divestment of Changi City Point and AEI efforts in Tampines One.

Any changes in stance: No adjustment nor changes in fundamental view. I’ll be updating my analyst report on FCT once their annual report is out.

Lendlease Global Commercial REIT

Announced their 1Q 2025 business update of which:

What is positive:

Portfolio occupancy improved to 89.5% from 89.1% with new leases committed for Building 3 of Sky Complex
Committed occupancy for LREIT’s retail portfolio remained high at 99.9% with a positive rental reversion of 11.4%1 and a healthy tenant retention rate of 90.0% as at 30 September 2024. Tenant sales in 1Q FY2025 continued to trend above pre-COVID-19 average levels..

What is negative:

Weighted average cost of debt increased to 3.74% per annum from 3.58%

Any changes in stance: No adjustment nor changes in the fundamental view

Lippo Malls Indonesia Retail Trust

Announced their 3Q 2024 business update of which:

What is positive:

Low refinancing requirement over 2024 and 2025.

What is negative:

On local currency term, NPI decreased by 1.4% yoy on higher operating expenses. On SGD term, NPI decreased by 6.3% yoy as a result of further weakening of Indonesia Rupiah.
The occupancy rate remains around 80%, which though is above industry average, is significantly lower as compared to other retail REITs at the back of a tougher retail backdrop in Indonesia.

Any changes in stance: No adjustment nor changes in fundamental view.

Sasseur REIT

Announced their 3Q 2024 business update of which:

What is positive:

Portfolio occupancy improved by 0.2% to 98%

Weighted average annual debt cost trending downward to 5.3% from 5.6% previously

What is negative:

Total outlet sales decreased by 7.2% y.o.y due to a softer market environment and exceptional factors (earthquakes)
EMA Rental Income for 3Q 2024 dipped slightly by 1.5% YoY due to the currency translation effect

Any changes in stance: No adjustment nor changes in fundamental view.

Paragon REIT

Announced their 3Q 2024 business update of which:

What is positive:

Gross revenue (3%) increased y.o.y at the back of higher rental revenue from Singapore properties.

What is negative:

Any changes in stance: No adjustment nor changes in fundamental view but target price will have to be reassessed with the transition of payment in management fees from units to cash.

Starhill Global REIT

Announced their 1Q 2025 business update of which:

What is positive:

Portfolio revenue and NPI y-o-y growth of 1.9% and 1.4% respectively on the back of higher contributions from Singapore and Perth Properties as well as appreciation of RM against SGD.
Occupancy rate remained resilient at 97.6%

What is negative:

Any changes in stance: No adjustment nor changes in fundamental view.

United Hampshire US REIT

Announced their 3Q 2024 business update of which:

What is positive:

Grocery & Necessity Properties’ committed occupancy increased by 1.3% to 97.6% with a strong tenant retention rate of 92% with long WALE of 7.9 years
Gross revenue for the nine months ended 30 September 2024 grew by 0.6% year-on-year to US$54.7 million. The growth was supported by new leases and rental escalations from existing leases, as well as revenue generated from the new Academy Sports + Outdoors store at St. Lucie West.

What is negative:

Net property income decreased by 3.4% largely due to the absence of divested assets and an increase in property expenses (Repair, maintenance and utilities)
Distributable income YTD is down by 15.1% at the back of higher finance costs, lower recoveries during tenant transition and payment of management fees in cash instead of in units

Any changes in stance: No adjustment nor changes in fundamental view.

Office & Commercial REITs

Cromwell European REIT

Announced their 3Q 2024 business update of which:

What is positive:

CEREIT delivered an overall 7.0% NPI growth in the third quarter, boosted by the completion of Nervesa21 office redevelopment in Milan and Novo Mesto ONE Industrial Park I/III logistics development near Bratislava.
CEREIT’s total portfolio occupancy was 93.9% as of 30 September 2024, up 30 bps compared to a quarter ago
Fitch Ratings revised CEREIT’s Outlook to Positive

What is negative:

9M 2024 distributable income fell 8.9% to €60.4 million compared to pcp, mainly due to the earlier divestments and higher interest costs.

Any changes in stance: No adjustment nor changes in fundamental view.

CapitaLand Integrated Commercial Trust

Announced their 3Q 2024 business update of which:

What is positive:

3Q YTD Net Property Income increased by 5.4% at the back of strong rental reversion (+9.2% for retail and +11.7% for office portfolio) and lower operating expenses, despite the absence of income from Gallileo since February 2024.
Achieved 100% committed occupancy for Phase 1 and 2 AEI at IMM Building, Singapore. New tenant brands include Birkenstock Outlet and Le Creuset Outlet

What is negative:

A slight decrease in portfolio occupancy by -0.4% q.o.q

Any changes in stance: No adjustment nor changes in fundamental view.

Elite UK REIT

Announced their 3Q 2024 business update of which:

What is positive:

9M 2024 available distribution per unit (“DPU”) increased 3.9% year-on-year to 2.132 pence from higher distributable income and tax savings
The occupancy rate increased by 1.6% to 93.9% with the divestment of Sidlaw House, Dundee for £1.3 million; offers received for two other vacant assets
With the completion of the debt refinancing exercise earlier this year, there are no further refinancing requirements until 2027

What is negative:

Net gearing stood at 43.6%

Any changes in stance: No adjustment nor changes in fundamental view. Following the changes in management strategy, it further reinforces my view that this counter should be avoided as I believe the management should be focusing on lowering debt instead of exploring acquisition opportunities in an area that is outside of their current expertise.

IREIT Global

Announced their 3Q 2024 business update of which:

What is positive:

Q3 performances remained largely stable and unchanged as compared to 1H 2024 performances
Active asset management seemed to be yielding some results in securing new tenants for the unoccupied properties

What is negative:

2025 distribution should be impacted due to the absence of income from the Berlin Campus

Any changes in stance: No adjustment nor changes in fundamental view.

Keppel Pacific Oak US REIT

Announced their 3Q 2024 business update of which:

What is positive:

Aggregate leverage at 42.6% as at 30 Sept 2024 against 43.2% as at 31 December 2023.

What is negative:

Portfolio committed occupancy dipped by 2% to 88.7% as at 30 Sept 2024
Income available for distribution decreased by 8.8% yoy at the back of lower NPI (-5.7%) and higher financial expenses (+11.8%)

Any changes in stance: No adjustment nor changes in fundamental view.

Keppel REIT

Announced their 3Q 2024 business update of which:

What is positive:

9M 2024 property income and net property income (NPI) increased by 12.3% and 10.8% year-on-year respectively, stemming from strong operational performance, as well as contributions from 2 Blue Street and 255 George Street
Recorded robust rental reversion of 10.2% and an increase in portfolio committed occupancy to 97.6%

What is negative:

Distribution income from operations experienced a decline of 2.1% at the back of higher borrowing cost
Aggregate leverage increased by 0.6% to 41.9%.

Any changes in stance: Adjusted my DPU growth forecast for FY2024 from -3% to -2%. Apart from that, there is no adjustment nor changes in fundamental view.

Manulife US REIT

Announced their 3Q 2024 business update of which:

What is positive:

No further debt is due in 2025 upon repayment in Nov 2024

What is negative:

The occupancy rate decreased by 1.4% to 77% q.o.q with a negative rent reversion of 7.4% registered in the third quarter
Aggregate leverage continued to remain elevated at 58.2% and the interest coverage ratio declined to 2.0 times

Any changes in stance: No adjustment nor changes in fundamental view.

Mapletree Pan Asia Commercial Trust

Announced their 2Q 2025 business update of which:

What is positive:

Singapore's portfolio continued to demonstrate resilience which has helped to dampen part of the headwinds experienced in their offshore properties
The aggregate leverage ratio improved from 40.5% to 38.4% as proceeds from Mapletree Anson divestments were used to reduce to pare down debts.

What is negative:

DPU decreased by 7.9% at the back reduced contribution from the divestment of Mapletree Anson and headwinds from their offshore properties – in particular their Japan properties.
Interim valuation conducted for MPACTs 3 properties in Makuhari Submarket of Chiba, Japan came out 17.2% lower due to the pressure on occupancy levels and market rents which prompted shifts in market assumption used by the valuer.

Any changes in stance: No adjustment nor changes in fundamental view. I’ve adopted a -8% growth rate in DPU from operations in the fair value calculations.

OUE Commercial REIT

Announced their 3Q 2024 business update of which:

What is positive:

What is negative:

Revenue (-1.3% yoy) and NPI (-3.7% yoy). The slight decline was primarily attributed to the lower contribution from the hospitality segment compared to the same period last year as well as an upward revision of the prior year’s property tax for Singapore Orchard and Crowne Plaza Changi Airport.

Any changes in stance: No adjustment nor changes in fundamental view.

Prime US REIT

Announced their 3Q 2024 business update of which:

What is positive:

Leasing volume remains stable with a slight increase q.o.q.
A Positive rental reversion of 6.5% is registered for 3Q
No refinancing obligations before 2026

What is negative:

Aggregate leverage still stood at a level of 46 to 47% on a proforma basis
9M distributable income has decreased by around 27%

Any changes in stance: No adjustment nor changes in fundamental view.

Suntec REIT

Announced their 3Q 2024 business update of which:

What is positive:

Singapore properties continue to exhibit strong performances while offset by a poorer performance from their offshore properties

What is negative:

Distribution per unit (“DPU”) from operations to unitholders was 1.58 cents or 0.9% lower year-on-year
The gearing ratio continued to remain at elevated levels of 42.3%

Any changes in stance: No adjustment nor changes in fundamental view.

Industrial REITs

AIMS APAC REIT

Announced their 1H 2025 business update of which:

What is positive:

DPU increased by 0.4% YoY to 4.670 Singapore cents for 1H FY2025, despite a larger Unitholders base following the completion of the S$100 million Equity Fund Raising in 1H FY2024
Gross revenue increased by 7.7% and net property income increased by 5.1% at the back of a strong rental reversion rate of 16.9% for the 1H 2025

What is negative:

Any changes in stance: I’ve adjusted my DPU growth forecast from -2% to 0%. Apart from that, there are no adjustments nor changes in the fundamental view

CapitaLand Ascendas REIT

Announced their 3Q 2024 business update of which:

What is positive:

The average portfolio rent reversion of leases renewed in 3Q 2024 was 14.4%

What is negative:

Aggregate leverage increased by 1.2% to 38.9% q.o.q
Portfolio Occupancy decreased by 1% to 92.1% q.o.q

Any changes in stance: No adjustment nor changes in fundamental view.

CapitaLand India Trust

Announced their 3Q 2024 business update of which:

What is positive:

In SGD, gross revenue grew by 19% and NPI grew by 18% – due to higher rental income from existing properties and income recognition from properties acquired

What is negative:

Any changes in stance: No adjustment nor changes in fundamental view.

Daiwa House Logistic Trust

Announced their 3Q 2024 business update of which:

What is positive:

Net property income (“NPI”) in JPY terms grew by 2.8% year-on-year (“y-o-y”).
Completed the acquisition of DHLT’s first Vietnam property in July 2024
The renewal rate for FY2024 was approximately 90%

What is negative:

Weaker JPY has affected the financials in SGD terms as Distributable Income decreased by 5.5% y.o.y for 9M FY2024

Any changes in stance: Revised forecasted DPU growth from -10% to -7.5% FY2024. Apart from that, no other changes in the fundamental view.

Digital Core REIT

Announced their 3Q 2024 business update of which:

What is positive:

Wale doubled from 2.8% years to just over 5 years q.o.q
The cost of borrowing decreased by 30 basis points

What is negative:

Any changes in stance: No adjustment nor changes in fundamental view..

ESR Logos REIT

Announced their 3Q 2024 business update of which:

What is positive:

On a same-store basis, Gross Revenue and NPI grew 1.9% and 1.2% respectively mainly due to positive rental reversion

What is negative:

3Q 2024 Gross Revenue and NPI dipped 6.3% and 6.5% respectively due to the divestment of non-core assets in FY2023 and 2Q2024, and decommissioning of 2 Fishery Port Road

Any changes in stance: No adjustment nor changes in fundamental view. Counter is still amid their portfolio rejuvenation and performance will only somewhat stabilize in FY2025.

Frasers Logistic & Commercial Trust

Announced their FY 2024 business update of which:

What is positive:

Average portfolio rental reversions of +12.8% (incoming rent vs. outgoing rent basis) and +23.6% (average rent vs. average rent basis) achieved for FY2024
Revenue (+6.2%) and Net Property Income (+2.7%) growth is derived mainly from the contributions from newly acquired properties, which is offset by higher operating expenses.

What is negative:

DPU declined by 3.4% on the back of higher finance costs and management fees paid in units. This is offset by the distribution from divestment gain and one-off income sources.
Overall portfolio occupancy experienced a 1.5% decline to 94.5%
Balance sheet health has also deteriorated slightly as a result of the impact of higher borrowing cost

Any changes in stance: I’ve changed my stance on the counter given the current fundamentals and valuation. My analyst report will be produced once the annual report is published. Clients can refer to the database in the shared folder to see what the new intrinsic value calculation is as well as my current stance on the counter.

Keppel DC REIT

Announced their 3Q 2024 business update of which:

What is positive:

Higher distributable income (+1.9%) and DPU (+0.4%) underpinned by strong reversions including reversion of >40% for a major Singapore contract renewal in 3Q 2024 as part of the Keppel leases. This is, however, offset by loss allowances for the Guangdong DCs, higher finance costs and depreciation of foreign currencies against SGD
Completed acquisition of Tokyo Data Centre 1 (Tokyo DC 1) on 31 Jul 2024

What is negative:

Aggregate leverage increased by 3.9% to 39.7%

Any changes in stance: No adjustment nor changes in fundamental view.

Mapletree Industrial Trust

Announced their 2Q 2025 business update of which:

What is positive:

NPI (+1.3%) increased mainly due to higher portfolio occupancy, positive rental reversion and a higher average rental rate for the Singapore Portfolio.
DPU increased by 1.2% yoy mainly driven by higher NPI and distribution declared by joint venture.
Completed Phase 3 fit-out works for Osaka Data Centre on 25 Jun 2024

What is negative:

Any changes in stance: No adjustment nor changes in fundamental view.

Mapletree Logistics Trust

Announced their 2Q 2025 business update of which:

What is positive:

Maintained resilient operational performance with 96.0% occupancy and 3.6% positive rental reversions excluding China.
The weighted average borrowing cost remained stable at 2.7% per annum for the three quarters.

What is negative:

Higher borrowing costs, regional currency depreciation and weakness in China continued to weigh on distributable income
Headwinds in China are expected to persist in the near future

Any changes in stance: I’ve changed my stance on MLT given the revision of their intrinsic value following the application of an additional -8% in DPU from operations. While the fundamental view on MLT has remained relatively unchanged, the original role that I’ve intended MLT to play in a diversified REIT portfolio has changed.

Sabana REIT

Announced their 3Q 2024 business update of which:

What is positive:

Overall portfolio occupancy at 84.9% as at 30 September 2024. A significant improvement from 78.8% in 1H 2024
All in financing costs remains largely unchanged

What is negative: