Frasers Logistics and Commercial Trust (FLCT) BUOU has reported portfolio occupancy of 96.2% and weighted average lease expiry of 4.4 years at the end of 3QFY2023 ended June, compared to 95.9% and 4.5 years in the previous quarter.
As at June 30, FLCT has 99 logistics and industrial properties and eight commercial properties, with a total portfolio value of some $6.9 billion. Total net lettable area is 2.7 million sq m, and while the logistics and industrial properties are 100% occupied, the commercial properties have an occupancy rate of 90.6%.
In a business update on Aug 1, FLCT says its gearing was up 0.7 percentage points (ppts) q-o-q to 28.6% as at June 30, while cost of borrowing also inched up 0.2% ppt to 2.0%.
Interest coverage ratio fell 0.4x to 8.0x, while debt headroom fell $62 million to $3,075 million as at June 30.
During the quarter, FLCT leased and renewed 67,600 sq m of space, with positive portfolio rental reversion of 9.8% on an incoming rent versus outgoing rent basis. On an average rent basis, rental reversion was also positive at 21.4%.
FY2024 borrowings are maturing in June and August 2024 and FLCT’s manager has started talks with banks on refinancing options. Every potential 50 basis points (bps) increase in interest rates on variable rate borrowings is estimated to impact distribution per unit (DPU) by 0.07 cents.
See also: FLCT reports 1HFY2023 DPU of 3.52 cents, 8.6% lower y-o-y
Looking ahead, FLCT’s manager points to global headwinds such as foreign exchange volatility, as the Singapore dollar strengthens against the Australian dollar, Euro and British pound.
The continued weakness of the Australian dollar against the Singapore dollar “adversely impacts distributable income and net asset value”, says the manager, as 49.3% of its portfolio is located in Australia.
In May, FLCT reported 1HFY2023 DPU of 3.52 cents, 8.6% lower y-o-y.
Units in Frasers Logistics and Commercial Trust closed 2 cents higher, or 1.64% up, at $1.24 on Aug 1.
