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Lendlease REIT reports portfolio occupancy of 99.9% in 3QFY2022 update

By Felicia Tan

/ The Edge Singapore |

May 5, 2022 2:02 PM SGT

'We successfully raised $1.7 billion to acquire 100% of Jem, which strengthens LREIT’s position amongst its peers," says Kelvin Chow, CEO of manager of Lendlease Global Commercial REIT

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SINGAPORE (EDGEPROP) - The manager of Lendlease Global Commercial REIT (LREIT) has reported a portfolio occupancy of 99.9% for the 3QFY2022 ended March. The occupancy rate stood stable q-o-q.

The REIT’s weighted average lease expiry (WALE) stood at 8.2 years by net lettable area (NLA) and 4.3 years by gross rental income (GRI) as at March 31.

According to the manager, the leases due for renewal in the FY2022 have been “substantially de-risked” to 1% by NLA and 3% by GRI.

During the quarter, tenant sales year-to-date (y-t-d) for the REIT’s retail portfolio have recovered to near its pre-Covid-19 levels in FY2020.

The manager adds it sees 313@Somerset benefitting from the reopening, on the back of the resumption of social activities, as well as the launch of the Vaccinated Travel Framework.

Its office portfolio has continued to generate stable revenue.

As LREIT’s Sky Complex operates on a triple-net lease structure with annual rental escalation based on the consumer price index, rising energy costs and inflation will not impact the property.

As at March 31, LREIT reported gross borrowings of $656.9 million with a gearing ratio of 27.7%. The gearing ratio will go up to 40.7% following the completion of the acquisition of Jem.

The REIT has a weighted average debt maturity of 1.8 years and an interest coverage ratio of 10.3x.

Kelvin Chow, CEO of the manager says, “FY2022 is a transformational year for LREIT. We successfully raised $1.7 billion to acquire 100% of Jem, which strengthens LREIT’s position amongst its peers, setting the stage for an exciting phase of growth. Moving forward, we are focused on active capital management to manage cost and gearing as well as executing our strategies to drive LREIT’s growth and to optimise returns to our unitholders.”

Further to its statement, the REIT manager announced that LREIT will be making distributions to its unitholders semi-annually and will distribute at least 90.0% of its adjusted net cashflow from operations for each financial year.

The actual level of distribution will be determined at the manager’s discretion.

Units in LREIT closed 1 cent lower or 1.26% down at 78.5 cents on May 4.

Check out the latest listings near 313 @ Somerset, Jem

This article first appeared on The Edge Singapore.

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