Frasers Centrepoint Trust acquisition pipeline unclear

Waterway Point mall, by Frasers Property, at Punggol New Town in Singapore; taken August 2018.Frasers Property‘s Waterway Point mall at Punggol New Town in Singapore.

Frasers Centrepoint Trust gave no specifics or timeline for any potential near-term acquisitions in its answers to unitholders’ questions on Wednesday, ahead of its annual general meeting (AGM).

“Acquisitions, like all commercial transactions, require the right opportunities to arise and even then, we would need to take into account a multitude of different considerations including, among other things, the prevailing market conditions, timing of the acquisition and available funding options,” the trust said in response to a question about when it planned to buy Northpoint City South Wing and the remaining stake it doesn’t already own in Waterway Point.

Currently, the trust owns Northpoint City North Wing (including Yishun 10 Retail Podium) and 40 percent of Waterway Point.

Frasers Centrepoint Trust said it currently doesn’t have any rights of first refusal (ROFR) over properties from its sponsor, Frasers Property, although it cited having “a strong and supportive sponsor” as a strategic advantage for the trust, including for managing a strong network of relationships in the retail sector. 

When asked what the trust’s acquisition pipeline would include, Frasers Centrepoint Trust said: “The acquisition opportunities in Singapore for FCT may include certain retail assets in the sponsor’s portfolio, an additional stake in Waterway Point (currently held by three joint venture partners, including FCT) as well as third party opportunities that may present themselves from time to time.”

In response to a question about whether the trust would venture overseas, it said it would remain focused on Singapore’s suburban retail sector, with any venture outside the city-state needing to be “carefully evaluated.”

The trust currently owns a 31.15 percent stake in Malaysia-based Hektar REIT, which has proposed a private placement for the first half of this year. After the placement, Frasers Centrepoint Trust’s stake in Hektar REIT is expected to be diluted to 29.67 percent, according to a statement from the Malaysian REIT.

Hektar REIT’s units have tumbled as Malaysia’s retail sector has been badly hit by a series of Movement Control Orders to stem the spread of the Covid-19 pandemic. Hektar REIT owns six commercial properties in peninsular Malaysia. 

Frasers Centrepoint Trust didn’t immediately respond to emailed questions from Shenton Wire Wednesday about its potential to make any acquisitions in the near term.

The AGM is scheduled for 18 January.

Read Frasers Centrepoint Trust’s answers to unitholder questions.

 

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