Basic Profile & Key Statistics
Performance Highlight
Related Parties Shareholding
- There is no official sponsor mentioned in Annual Report
- REIT manager's shareholding is high at 1.646%
- Directors of REIT manager's shareholding is high at 8.574%
Lease Profile
- Occupancy is slightly high at 95.1%
- WALE is long at 4.55 years
- Highest lease expiry within 5 years is low at 22% which falls in 2023
- Weighted average land lease expiry is slightly long at 75 years
Debt Profile
- Gearing ratio is high at 44.3%. Include perps, gearing is at 47.3%.
- Cost of debt is slightly low at 2.32%
- Fixed rate debt % is low at 57%
- Unsecured debt % is low at 61.3%
- WADM is moderate at 3.07 years
- Highest debt maturity within 5 years is low at 19.8% which falls in 2023
- Interest coverage ratio is low at 2.7 times
- Preferred/perpetual securities over debt is moderate at 6.3%
Diversification Profile
- Top geographical contribution is high at 67.3%
- Top property contribution is high at 44.2%
- Top 5 properties contribution is high at 84.6%
- Top tenant contribution is low at 6.4%
- Top 10 tenants contribution is low at 30.6%
Key Financial Metrics
- Property yield is low at 3%
- Management fees over distribution is high at 22.6% in which unitholders receive S$ 4.42 for every dollar paid
- Distribution on capital is low at 2.2%
- Distribution margin is moderate at 53.1%
- 6.2% of TTM distribution is from income support
Trends
- Flat - NAV per Unit
- Slight Downtrend - Distribution Margin
- Downtrend - DPU, Interest Coverage Ratio, Property Yield, Distribution on Capital
Relative Valuation
- P/NAV - Average for 1y; Below average for 3y & 5y
- Dividend Yield - Above average for 1y & 5y; Above +1SD for 3y
Author's Opinion
| Favorable | Less Favorable |
|---|---|
| Diversified Sector | High Gearing Ratio |
| High REIT Manager's Shareholding | Low Fixed Rate Debt % |
| High Directors of REIT Manager's Shareholding | Low Unsecured Debt % |
| Long WALE | Low Interest Coverage Ratio |
| Well Spread Lease Expiry | High Top Geographical Contribution |
| Well Spread Debt Maturity | High Top Property & Top 5 Properties Contributions |
| Low Top Tenant & Top 5 Tenants Contributions | Low Property Yield |
| Non-Competitive Management Fees | |
| Low Distribution on Capital | |
| DPU Downtrend | |
| Interest Coverage Ratio Downtrend | |
| Property Yield Downtrend | |
| Distribution on Capital Downtrend |
Despite COVID-19 restrictions, Suntec REIT performance and fundamentals have improved as compared to the previous quarter. However, the gearing ratio is still on the high side, the current gearing ratio of 44.3% is the 2nd highest among Singapore REITs. For upcoming quarters, the full quarter contribution from the Minster Building coupled with vaccinated travel lanes (VTL) of Singapore and planned border opening of Australia should improve its performance.
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*Disclaimer: Materials in this blog are based on my research and opinion which I don't guarantee accuracy, completeness, and reliability. It should not be taken as financial advice or a statement of fact. I shall not be held liable for errors, omissions and loss or damage as a result of the use of the material in this blog. Under no circumstances does the information presented on this blog represent a buy, sell, or hold recommendation on any security, please always do your own due diligence before any decision is made.
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