Frasers Centrepoint Trust to join STI from Mar 18
Following $Straits Times Index(STI.SI)$’s March quarterly review, it was announced that $Frasers Cpt Tr(J69U.SI)$ (FCT) will be added to the STI and Emperador to be removed from it, effective at the start of business next Monday (Mar 18). This brings the total number of Singapore real estate investment trusts (S-Reits) in the STI to seven.
At a market capitalisation of S$3.9 billion, FCT will join the STI with an approximate weight of 0.8%. FCT is also the second Frasers Property-sponsored Reit to join the benchmark after $Frasers L&C Tr(BUOU.SI)$. The combined indicative weightage of the seven S-Reits in the STI will be around 12.5.
REIT Watch - S-Reits in the STI and STI reserve list from Mar 18
FCT listed in Singapore on July 5, 2006, with an initial public offering (IPO) price of S$1.03. According to Bloomberg data, FCT has paid more than S$1.80 per unit in distributions since its listing. This brings its annualised total returns since the IPO to 10%. At listing, FCT’s initial portfolio consisted of just three suburban malls – Causeway Point, Northpoint and Anchorpoint – with a combined value of S$915 million at the time.
Today, FCT’s portfolio has grown to nine suburban retail malls and an office building with a combined S$6.5 billion in assets under management as at Dec 31, 2023. FCT is also one of the three remaining pure-play Singapore property S-Reits alongside $Sabana Reit(M1GU.SI)$ and $Far East HTrust(Q5T.SI)$.
FCT has also been active on the acquisition and divestment front in recent years. The Reit most recently increased its initial 25.5% acquisition of retail mall Nex in February 2023, to a 50% interest, which was partially funded with a private placement of S$200 million. Nex is seen as a strategic fit for FCT’s prime suburban retail portfolio.
The mall is the largest suburban mall in the north-east of Singapore by net lettable area and is easily accessible by the integrated Serangoon Bus Interchange and Serangoon MRT.
In FCT’s latest business updates for Q1 2024 ended Dec 31, 2023, the Reit recorded stronger operating performance with improved committed occupancy at 99.9% and shopper traffic 3.1% higher year on year. Tenant sales for the Q1 2024 period was 0.7% lower year on year due to the renovation of several anchor tenants, but overall tenant sales for the whole year of 2023 was approximately 18% above pre-Covid levels.
In terms of sustainability initiatives, FCT projects annual savings of about S$1 million in operating expenditure from its various initiatives, one of which is rolling out solar photovoltaic panels across six of its malls from this year as part of its net zero carbon initiatives to reduce Scope 1 and Scope 2 greenhouse gas emissions by 67% from the 2019 baseline, by 2035.
FCT has ranked among the top 35 stocks by trading turnover this year, while also ranking among the 15 stocks that have booked the most net institutional inflows. FCT is also the only S-Reit that has recorded net buying activities across both institutional and retail investors.
The STI reserve list, which consists of the five highest ranking non-constituents of the STI, will be: $CapLand Ascott T(HMN.SI)$ $ComfortDelGro(C52.SI)$ , $Keppel DC Reit(AJBU.SI)$ , $KEPPEL REIT(K71U.SI)$ , and $Suntec Reit(T82U.SI)$ .
https://www.sgx.com/research-education/market-updates/20240311-reit-watch-frasers-centrepoint-trust-join-sti-mar-18
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