SPH Reit to focus on 'providing sustainable rental income'

SPH Reit management CEO Susan Leng Mee Yin and SPH Reit management chairman Leong Horn Kee at an annual general meeting, held virtually, on Nov 26, 2020. ST PHOTO: MARK CHEONG

SINGAPORE (THE BUSINESS TIMES) - SPH Reit will now focus on providing "sustainable rental income" by minimising vacancies for FY2021, it said at an annual general meeting (AGM) on Thursday.

It added that it is committed to supporting tenants through this challenging Covid-19 period, so as to position assets to be ready to capture the business opportunity when recovery begins.

The chief executive of SPH Reit management, Susan Leng Mee Yin, said: "We will continue to work closely with our tenants in a targeted manner... so that both landlords and tenants can be ready for recovery."

This is in hopes of preserving long-term returns for its unit holders, she said.

To maintain occupancy in its assets for sustainable rental cash flow, rental relief totalling S$39.9 million has been granted to help its tenants during the Covid-19 pandemic, it said.

Tenancies for its Australian assets have recovered strongly, hitting close to pre-Covid-19 levels, but tenancies for its Singapore assets are turning around more slowly.

The Reit's portfolio has maintained its occupancy rate at 97.7 per cent.

SPH Reit on Thursday also unveiled its multi-pronged growth strategy to provide unit holders with regular, stable distributions. The strategy includes continually optimising the tenant mix of its properties, as well as implementing asset-enhancement initiatives and proactive marketing plans, Ms Leng said.

There will also be a right of first refusal for the Reit's sponsors' future income-producing properties used primarily for retail purposes in Asia Pacific.

Given the uncertainty and fluidity of the Covid-19 pandemic, the extent of its impact on SPH Reit's financial performance for the next reporting period, and the next 12 months cannot be determined at this stage, Ms Leng added.

The chairman of SPH Reit management, Leong Horn Kee, said: "We will continue to build on the strong partnerships established with our tenants, and adapt and overcome the challenges in the fast-changing retail environment."

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