While the trust’s latest performance was largely affected by negative rental reversions from Paragon, Lock highlights that the bulk of expiring let lettable area (NLA) for the rest of FY18 and FY19 will largely come from the mall. This could in turn help SPH REIT to benefit from improved retail sentiment on the back of a recent pickup in retail sales and a better economic outlook, she adds.
SINGAPORE (Jan 8): CIMB is reiterating its “hold” call on SPH REIT with an unchanged target price of $1.06, after the trust’s 1Q18 distribution per unit (DPU) came in within expectations at 23.8% of the research house’s forecast with a total return of about 4%.
Lead analyst Lock Mun Yee says she continues to like SPH REIT’s Paragon and Clementi Mall properties for their niche positioning within micro-markets in spite of the near-term challenging environment.
