Suntec Real Estate Investment Trust (T82U) H2 2024 earnings summary

Executive summary

• FY24 distributable income from operations was $180.9m, down 1.6% YoY; DPU from operations was 6.192 cents, down 2.3%.

• Singapore office and retail performance, stronger JV contributions and Sydney gains supported results; Adelaide and London vacancies and higher financing costs weighed on income.

• Portfolio committed occupancy rose to 95.4% from 94.9% in FY23; portfolio WALE was 3.8 years.

Financial highlights

• FY24 gross revenue was $463.6m versus $462.7m in FY23; NPI was $310.8m versus $313.2m, while JV income rose 6.4% to $100.0m.

• Distributable income from operations was $180.9m, down 1.6% YoY; DPU from operations was 6.192 cents, down 2.3%. DPU declined 13.2% YoY without a capital distribution in FY24.

• Portfolio valuation declined 1.2% to $11,752.5m; Singapore rose 1.4%, offset by declines of 10.5% in Australia and 1.2% in the UK.

Outlook and guidance

• Singapore office rent reversion is expected at 1%–5%; occupancies are expected to outperform the market, with cautious demand and GDP growth projected at 1%–3%.

• Singapore retail occupancy is expected to remain above 95%, with rent reversion of 10%–15%.

• Australia portfolio performance and occupancy are expected to remain stable; 55 Currie Street vacancy may rise 10%–12% in the medium term.

• UK rent reversion is expected at 1%–3%; The Minster Building vacancy and upcoming expiry are expected to be backfilled in 2025, with leasing downtime affecting performance.

• FY25 refinancing is expected to complete by 1H 2025; financing cost is expected to rise 10–20 bps as hedges expire.