Lendlease Global Reit's Q3 portfolio occupancy holds steady at 99.7%

JYEU : JYEU 0% on Friday said its portfolio occupancy stood at 99.7 per cent as at March 31, down by a marginal 0.1 percentage point on year and unchanged from the previous quarter.

In a Q3 business update issued on Friday, its manager said the Reit's (real estate investment trust) portfolio's weighted average lease expiry (WALE) for the period stood at nine years by net lettable area (NLA) and 4.6 years by gross rental income (GRI). This was down from its WALE of 9.3 years by NLA and 4.9 years by GRI as at Dec 31, 2020.

The manager said it has completed about 98 per cent and 97 per cent of the expiring leases in FY2021 in terms of NLA and GRI, respectively.

It further noted that tenant sales at 313@somerset has recovered at a faster rate than visitation on a year-on-year basis at 94 per cent and 77 per cent respectively, as shopper spending continued to increase despite reduced footfall. Tenant retention rate for the mall stood at around 62 per cent as at end-March.

313@somerset's multifunctional event space has notably been "substantially leased" to live entertainment company Live Nation as the anchor tenant. Lendlease Global Reit's manager expects to the event space - where development works are expected to commence in H2 of 2021 and complete in 2022 - to draw constant footfall and boost tenant sales in the mall going forward.

Highlighting Jem's new anchor tenant Ikea, the manager says the ability to bring in new and established brands to the mixed-used asset will reinforce Jem's positioning as a dominant mall in the west of Singapore.

A NEWSLETTER FOR YOU

Tuesday, 12 pm

Property Insights

Get an exclusive analysis of real estate and property news in Singapore and beyond.

Sign Up

Lendlease Global Reit's Grade-A office in Milan, Sky Complex, remains 100 per cent leased to Sky Italia, a subsidiary of Comcast Corp. The Reit manager says a newly appointed property manager for the property has resulted in some cost savings for its unitholders.

It added that a positive interest and progress of developments in the Milano Santa Giulia district are expected to "accelerate the transformation" of the area into one of Milan's key decentralised office and mixed-use destinations.

Despite noting improving demand indicators in the overall retail landscape, Lendlease Global Reit's manager believes the retail sector has yet to reach full recovery and expects leasing demand to remain weak in the short term.

"Alongside challenges from the growth of e-commerce and demand for experiential offerings, landlords may have to review their tenant mix and pivot their strategies. Nevertheless, the retail space market fundamentals continue to look encouraging with little supply expected in the Orchard Road micro-market over the next three years. This will lend support to modest leasing activities in the medium term," it said.

Units of Lendlease Global Reit closed flat at S$0.78 on Friday.