SINGAPORE - Lendlease Global Commercial Reit (LReit) on May 6 reported a committed portfolio occupancy of 88.8 per cent for the third quarter ended March 31, 2024, up from 87.9 per cent from the previous quarter.
The Reit continues to maintain a long portfolio weighted average lease expiry of 7.8 years by net lettable area (NLA) and 4.8 years by gross rental income (GRI), respectively, for the third quarter.
In a third-quarter business update to the Singapore Exchange, the real estate investment trust’s (Reit) manager said this is mainly attributed to the positive leasing momentum for Sky Complex (Building 3), where approximately 8.1 per cent of the NLA was committed at market rents within three months post lease restructuring of the complex.
Sky Complex is a group of three Grade A office buildings located at Santa Giulia Business District in Milan.
The manager said office tenants account for approximately 22 per cent of the portfolio GRI.
“With a long office weighted average lease expiry of 12.6 years by NLA and 15.1 years by GRI, it will provide stable revenue for LReit’s unitholders,” said the manager.
As at March 31, 2024, the Reit’s retail portfolio occupancy was 99.4 per cent, with positive rental reversion of 15.3 per cent. It has maintained a healthy retail tenant retention rate of 86.2 per cent.
It said tenant sales were up 2.6 per cent year on year to $207.9 million in the third quarter of financial year 2024, while visitation increased 6.1 per cent from 15.4 million in the year-ago period to 16.4 million this quarter.
In the third quarter, gross borrowings were $1.57 billion with a gearing ratio of 41 per cent. The weighted average debt maturity was 2.8 years with a weighted average cost of debt of 3.5 per cent per annum.
Interest coverage ratio of LReit was 3.4 times, which provides ample buffer from its debt covenants of two times, said the manager.
Mr Kelvin Chow, chief executive of the manager, said: “The leasing progress at Building 3 of Sky Complex is an encouraging step towards our strategic repositioning to secure multi-tenancy at market rents.
“Moving forward, we will continue to remain focused on prudent capital management to manage cost and gearing.”
Units of Lendlease Global Commercial Reit closed unchanged at 55 cents on May 7. THE BUSINESS TIMES
