Brick-and-mortar shopping still plays an important role even as retailers embrace e-commerce opportunities, said SPH Reit Management chief executive Susan Leng.
Speaking at the inaugural annual general meeting (AGM) of the Reit (real estate investment trust) yesterday, Ms Leng said malls have to evolve with the times and make the shopping experience a multi-sensory one.
"The 'touch-and-feel' (aspect of retail) still has a big part to play," she noted, adding that brick- and-mortar shopping can complement the convenience of e-commerce.
Ms Leng was responding to queries from unit-holders who expressed concerns about the impact of online shopping on foot traffic at The Clementi Mall and Paragon, the two properties in SPH Reit's portfolio.
The malls have not been hit in a big way by the e-commerce trend and occupancy rates remain at 100 per cent, she said.
"Our tenants are established retailers who have embraced e-commerce as an opportunity."
Ms Leng also noted that e-commerce allows retailers to offer a wider range of merchandise online, which can aid tenants in optimising their use of retail space.
SPH Reit made its debut on the Singapore Exchange mainboard on July 24 last year. Yesterday's AGM, held at the Singapore Press Holdings News Centre, was attended by about 300 unit-holders.
In addition to the impact of e-commerce, unit-holders asked about the potential acquisition of the newly opened The Seletar Mall by the Reit.
SPH Reit will have the "right of first refusal" should its sponsor, Singapore Press Holdings, decide to sell the mall, said Ms Leng.
The Reit will "evaluate the opportunity" when its sponsor decides that it is time to divest itself of the property.
"We will do due diligence... and look at location, the tenancy mix... The Reit's objective is to provide unit-holders with regular and stable distributions," said Ms Leng, adding that the Reit will also continue to look for other acquisition opportunities.
The four-storey The Seletar Mall, which officially opened yesterday, houses the area's first cinema and is aimed at catering to young families.
SPH Reit has released its first annual report, detailing its performance from its listing date to Aug 31 this year - slightly longer than the usual 12 months.
Distribution per unit for the period was 5.99 cents on the back of strong rental growth, exceeding forecasts by 3.8 per cent. Rents rose by about 8.5 per cent.
Valuations for the Reit's portfolio properties have gone up by 3.4 per cent to $3.16 billion since the initial public offering.
Tenant sales in the period were hit by weak retail industry sentiment and a decline in international tourist arrivals, said Ms Leng. But visitor traffic in both The Clementi Mall and Paragon still held steady.
Acknowledging that "the retail scene is competitive", Ms Leng said SPH Reit actively manages its properties to "keep them at the forefront of evolving retail mall trends and stay relevant to consumers".