Lendlease Global Commercial REIT sees modest DPU uptick in 2H FY2025
The DPU, scheduled to be paid on Sept 24, is driven by steady retail performance and a more favourable interest rate outlook, according to the REIT in a statement.
Lendlease REIT's portfolio valuation rose 2.2 per cent year-on-year (YoY) to SG$3.76 billion, supported by its core Singapore assets. Following the Jem office divestment, Singapore retail will comprise over 85 per cent of portfolio value.
Its chief executive officer, Guy Cawthra said this divestment is a strategic milestone—reducing leverage, enhancing flexibility, and reinforcing its commitment to long-term growth in prime retail.
While gross revenue and net property income (NPI) declined 6.5 per cent and 10.0 per cent YoY to SG$206.5 million and SG$148.8 million, respectively, this was largely due to the one-off recognition of supplementary rent from the lease restructuring of Sky Complex in FY2024. On an adjusted basis, revenue and NPI saw marginal YoY growth.
The REIT maintained an interest coverage ratio (ICR) of 1.6 times and reported that 68 per cent of its borrowings are hedged to fixed rates, with the average cost of debt at 3.46 per cent per annum.
Retail strength continued, with over 99 per cent occupancy and a 10.2 per cent positive rental reversion, despite weaker tenant sales due to outbound tourism and transitional refurbishments at Cathay Cineplexes.
In Milan, commercial Buildings 1 and 2 recorded a 1.7 per cent rental uplift tied to inflation-linked escalation clauses. These assets remain fully leased to Sky Italia until January 2033.
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