As it turns out, FPL’s attributable profit fell by 81% in its FY2023 to $173.1 million, for the 12 months to Sept 30. The fair value change and gain on disposal of investment properties was a negative $446.17 million in FY2023, with a negative $441.75 million recorded in FPL’s 2HFY2023. The valuation decline also led to a decline in NAV to $2.52 as at Sept 30, 2023, compared to $2.64 a year ago.
The decline in investment property valuations of local developers and S-REITs is unlikely to impact banks’ balance sheets to date, analysts have indicated. However, the net profit and NAVs of the developers and S-REITs are likely to be impacted.
On Oct 12, 2023, Frasers Property (SGX:TQ5
) (FPL) announced that it expected fair value losses on a portion of its portfolio of investment properties, primarily its commercial properties in the UK and industrial and logistics properties in Europe. The caveat was that the fair value losses were non-cash in nature and arose mainly due to higher capitalisation rates.
