LREIT Reports 11.4 Pct Retail Rental Reversion In 1Q FY2025

KUALA LUMPUR, Nov 12 (Bernama) -- Managed by Lendlease Global Commercial Trust Management Pte Ltd (Manager), Lendlease Global Commercial REIT (LREIT), has posted a positive rental reversion of 11.4 per cent in its first quarter (1Q) business update for fiscal year 2025 (FY2025).

LREIT, in a statement, said its portfolio committed occupancy continued to improve in 1Q FY2025 to 89.5 per cent from 89.1 per cent in the fourth quarter for fiscal 2024 (FY2024).

In the first three months of FY2025, the lease expiry profile remained well-staggered, with 6.4 per cent by net lettable area (NLA) and 12.1 per cent by gross rental income (GRI) due for renewal in FY2025.

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LREIT has maintained a long portfolio weighted average lease expiry (WALE) of approximately 7.4 years by NLA and 4.7 years by GRI, respectively.

The committed occupancy for its retail portfolio remained high at 99.9 per cent, with a positive rental reversion of 11.4 per cent and a healthy tenant retention rate of 90.0 per cent as at Sept 30. Tenant sales in 1Q FY2025 continued to trend above pre-COVID-19 average levels.

Notwithstanding the high occupancy rate, the Manager stays focused on strengthening the tenancy mix and bringing in new offerings to rejuvenate the malls. New tenants brought onboard include Tims Signature, Eclaire & Savoir Cafe and Slow Green.

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As at Sept 30, office tenants accounted for approximately 21 per cent of portfolio GRI with a long WALE of 12.2 years by NLA and 14.5 years by GRI.

The Manager continues to see good leasing interests for Building 3 of Sky Complex. For the quarter, committed occupancy rate for Sky Complex improved to 75.0 per cent and the Manager is in advanced negotiations with potential tenants as it continues to drive leasing of Building 3 at market rental.

Meanwhile, interest coverage ratio (ICR) as at the period end was 2.9 times, providing a sufficient buffer from its debt covenants of 2.0 times. Approximately 70 per cent of borrowings are hedged to fixed rates as at Sept 30 with a weighted average cost of debt of 3.74 per cent per annum, mainly due to the replacement of EURIBOR interest rate hedge at a higher rate in October 2023.

Moreover, LREIT achieved first position in GRESB Asia Retail (Listed) category for five consecutive years since listing for its environmental, social and governance (ESG) performance and strong leadership in sustainability.

-- BERNAMA