SPH REIT announced DPU for the FY2020 ended August fell more than 50% to 2.72 cents, while NAV fell 4.2% y-o-y to 91 cents. This gives a yield of just 3.16% based on its Oct 7 closing of 86 cents, and a price to NAV of 0.95 times. The NAV decline was caused by a 3.5% y-o-y decline in the valuation of the REIT’s Singapore properties, and a 5.5% decline of its two Australian malls.
The Singapore properties comprise The Paragon, Clementi Mall and Rail Mall, and their total valuation dropped to $3.29 billion. The Australian assets are Figtree Grove Shopping Centre in New South Wales, and Westfield Marion Shopping Centre in South Australia which was acquired in December 2019 for A$670 million ($649 million). Their combined valuation fell to A$836.5 million.
Covid-19 caused shopper traffic in the portfolio to fall by 22.6% y-o-y, while tenant sales declined by 15.9%. Shopper traffic in the Singapore malls fell by 27.7% while the Australian malls experienced a gentler 8.3% decline. In Singapore, The Paragon, located on Orchard Road, experienced a 27.4% decline in shopper traffic and a 28% decline in tenant sales.
Westfield Marion and Figtree Grove recorded tenant sales of A$691 million and A$185 million, representing a decline of 9.1% and 1.1% respectively. Westfield Marion, the largest shopping centre in South Australia with a higher discretionary offering, registered a drop in footfall of 11.2% to 11.9 million. Figtree Grove was well supported by the residential catchment in the suburbs of Wollongong and footfall was maintained at 4.6 million.
“SPH REIT’s Australia assets, though not spared the effects of Covid-19, were relatively less impacted for the relevant period, and an allowance for rent relief of $8.1 million was provided for FY2020 to support eligible tenants affected by Covid-19,” says SPH REIT’s manager.
Elsewhere, Frasers Centrepoint Trust’s placement of 244.68 million new units at $2.35 each was 2.8 times subscribed, raising $575 million. FCT is also raising a further $759.65 million from an issue of 324.64 million units. The preferential offering units will be issued in the ratio of 290 new units for 1,000 existing units. Most of the capital raised will be used to acquire a 63.1% stake in PGIM Asia Retail Fund that it does not own from its sponsor Frasers Property for $1.057 billion.
