Tenant sales back at pre-Covid levels for Retail S-Reits

SINGAPORE'S retail sales increased 8.7 per cent in March 2022 on a year-on-year basis, a reversal from the 3.5 per cent decrease in February 2022, according to the Singapore Department of Statistics (SingStat).

Within the retail trade sector, most industries recorded year-on-year sales growth in March 2022.

Listed on the SGX are 7 S-Reits which have significant exposure to Singapore-based retail assets.

All seven S-Reits have announced their financial results or business updates this reporting season and they are: CapitaLand Integrated Commercial Trust : C38U +0.89%, Frasers Centrepoint Trust : J69U -0.43%, Lendlease Global Commercial Reit : JYEU 0%, Mapletree Commercial Trust : N2IU 0%, SPH Reit : SK6U -0.53%, Starhill Global Reit : P40U 0% and Suntec Reit : T82U +2.34%.

CapitaLand Integrated Commercial Trust’s (CICT) net property income (NPI) from its retail assets grew 0.6 per cent year on year to S$101.8 million in Q1 2022.

Its retail occupancy maintained at 96.6 per cent as at Mar 31, 2022 while tenant retention rate is 91 per cent in Q1 2022.

Frasers Centrepoint Trust (FCT) reported that its retail portfolio occupancy improved from 97.2 per cent last quarter to 97.8 per cent.

It noted that shopper traffic has improved to around 65 per cent of pre-Covid levels during the January to March 2022 period while tenants’ sales have maintained at above pre-Covid levels since Oct 2021.

Lendlease Global Commercial Reit (LReit) noted that its retail portfolio saw strong occupancy rate, maintaining above 99 per cent, with a healthy tenant retention rate of 71.1 per cent.

The Reit completed its capital fundraising exercise to acquire 100 per cent of Jem mall in April 2022. LReit is also confident that 313@somerset will benefit from the re-opening trajectory in Singapore.

Mapletree Commercial Trust (MCT) saw healthy performance at VivoCity mall, which had a 99.2 per cent committed occupancy as at Mar 31, 2022.

It noted that, in tandem with easing Covid-19 measures, tenant sales kept a steady recovery momentum with fourth quarter FY21/22 tenant sales rebounding by 10.3 per cent on a year-on-year basis, reaching pre-Covid levels.

SPH Reit’s Singapore retail assets maintained an occupancy rate of 99.1 per cent as at Feb 28, 2022 and noted that overall tenant sales for the Singapore assets increased 2 per cent year on year for H1 FY2022.

Starhill Global Reit’s Singapore retail occupancy rates remained at 98.9 per cent as at Mar 31, 2022. Shopper traffic and tenant sales at Wisma Atria increased 11.7 per cent and 18.2 per cent year on year respectively during the quarter.

Suntec Reit reported 13.9 per cent year-on-year growth in Q1 2022 gross revenue, partly contributed by higher income from Suntec City Office and Suntec City Mall.

The Reit believes that the easing of Covid-19 pandemic restrictions and the reopening of the economy will boost the recovery of footfall as well as tenant sales and that mall occupancy will likely remain stable at above 95 per cent.