Retail Portfolio Reaches Near-Full Occupancy
Frasers Centrepoint Trust (FCT) has reported a strong third-quarter performance, achieving a committed occupancy of 99.9 percent across its retail portfolio as of June 30, 2025. This figure represents a notable increase of 0.2 percentage points year-on-year and 0.4 percentage points quarter-on-quarter. The manager clarified in its business update that this impressive statistic excludes Hougang Mall, which is currently undergoing an asset enhancement initiative (AEI) works, while the previous year’s figure excluded Tampines 1 for the same reason. Excluding the mall under renovation, all of FCT’s properties have maintained a committed occupancy exceeding 99 percent, with several reaching full occupancy. The strong performance was further evidenced by increased footfall and tenant sales, which grew by 2.1 percent and 4.4 percent, respectively, compared to the same period last year. The manager anticipates that government support measures will provide an additional boost to consumer spending in the coming months, further strengthening the retail environment.
Strategic Growth and Financial Health
The trust’s strategic acquisition of Northpoint City South Wing has played a crucial role in bolstering its portfolio and positioning it for future organic growth. This acquisition, along with potential AEIs, is expected to generate long-term cost savings and reinforce FCT’s position as a leading owner of prime suburban retail spaces in Singapore. Northpoint City is particularly well-situated to benefit from the ongoing revitalization of the north region, which is transforming into a vibrant “work-live-play hub.” Financially, FCT has demonstrated robust health, successfully completing an equity fundraising of S421.3millionandissuingS200 million in perpetual securities at a competitive pricing of 3.98 percent. The trust’s financial discipline is also reflected in its improved cost of debt, which decreased to 3.7 percent in the third quarter. This strong financial foundation provides a solid platform for future growth and portfolio expansion.
Resilient Market Outlook
Despite persistent geopolitical tensions and a climate of economic uncertainty, the FCT manager remains optimistic about the resilience of the retail sector. They noted that both rents and retail sales are holding up well, a trend supported by the limited new retail supply expected in the coming years. Projections indicate that new private retail space between 2025 and 2028 will increase by only about 2 percent from the current stock, ensuring a tight market. The manager’s conclusion is that the combination of limited supply and healthy demand will continue to be the primary driver underpinning Singapore’s suburban retail market. The trust is well-equipped to capitalize on these favorable market conditions, ensuring stable performance and potential for future growth.
