COMMERCIAL PROPERTY, ECONOMY | Staff Reporter, Singapore

SPH REIT's NPI up 1.2% in FY2020

This was thanks to newly-acquired assets in Australia.

SPH REIT's net property income (NPI) remained resilient for its fiscal year 2020, registering a 1.2% climb to reach $181.9m (US$133.7m), the company said in a media briefing. This was the result of added contribution from newly-acquired assets in Australia which more than offset the declined contribution from Singapore assets brought about by COVID-19.

COVID-19 impacted performance in H2, with the REIT's Singapore assets' performance significantly impacted by COVID-19. THe firm gave rent relief amounting to $31.8m (US$23.4m) to eligible tenants in Singapore to assist them in riding through this pandemic, which in turn resulted in its Singapore assets' NPI  to decline by 16.4%$143.2m (US$105.2m).

In Australia, the REIT's properties Westfield Marion Shopping Centre (Adelaide) and Figtree Grove Shopping Centre (Wollongong) contributed $26.3m (US$19.3m) and $12.5m (US$9.2m) to NPI, respectively.

These assets were relatively less impacted by COVID-19, and an allowance for rent relief of $8.1m (US$5.9m) was provided for 2020 to support all eligible tenants affected in this period.

Various restrictions imposed to combat the spread of the virus also impacted international tourism and lifestyles, causing a fall by an average of 27.7% at SPH REIT’s Singapore assets and 8.3% at its Australia assets YoY. It registered a decline of 27.4% YoY to $13.8m (US$10.1m) and diminished tenant sales of 28.3% to $508m (US$373m).

Westfield Marion and Figtree Grove recorded tenant sales of $670.6m (US$493.5m) and $180m (US$132.5m), 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 of 11.2% to $11.5m (US$8.5m).

Figtree Grove was also well-supported by the residential catchment in the suburbs of Wollongong and footfall was maintained at 4.6 million. Amidst the uncertainty surrounding COVID-19, Singapore assets shrunk to 3.5% YoY in August 2019, while Australian assets declined in valuation by 5.5% YoY.

As of 31 August 2020, SPH REIT’s gearing was stable at 30.5% while its debt maturities were well-staggered with no refinancing due till June 2021. In addition, they have put in place new unsecured credit facilities of $225m (US$165.6m) that can be drawn when required.

In addition, $15m (US$11m) of capital allowance was utilised to provide for capital expenditure and other working capital requirements.

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