Starhill Global REIT's 1H FY23/24 Result Review

Basic Profile & Key Statistics

Key Indicators

Performance Highlight

Gross revenue and NPI remain similar YoY. Income available for distribution, income to be distributed and DPU declined YoY due to highest finance costs.

Shopper Traffic & Tenant Sales

In 1H FY23/24, both tenant sales and shopper traffic for Wisma Atria have improved YoY despite basement renovation which started in August 2023.

Asset Enhancement Initiative

The basement upgrading work for Wisma Atria started in August 2023 and is expected to be completed by March 2024. While for the facade upgrading work in Myer Centre is expected to be completed in this month.

Related Parties Shareholding

The REIT sponsor and REIT manager hold a relatively high proportion of shares, whereas the directors of the REIT manager hold a relatively low proportion of shares.

Lease Profile

The committed occupancy is high and the lease expiry is well-distributed after the early lease renewal with Toshin, whose original lease expiry was in June 2025.

Debt Profile

The debt profile is moderate, with a notable aspect being the well-spread debt maturity.

Diversification Profile

SGREIT shows a relatively high concentration in geographical, properties, and tenants' contributions.

Key Financial Metrics

The operating distributable income margin is on a relatively high side.

DPU Breakdown

• TTM Distributable Income Breakdown:
• 96.3% from Operation
• 3.7% from Management Fees Paid in Units
• TTM Distribution = 97.3% of Distributable Income

Trends

• Uptrend: Property Yield, Operating Distributable Income on Capital, Operating Distributable Income Margin
• Slight Uptrend: DPU from Operation
• Flat: Committed Occupancy
• Downtrend: NAV per Unit, Adjusted Interest Coverage Ratio

Relative Valuation

• Dividend Yield - Average fort 1y; Above +1SD for 3y & 5y
• P/NAV - Average for 1y & 5y; Below -1SD for 3y

Author's Opinion

Although gross revenue and NPI remain similar to the previous half-year, the DPU has declined due to a combination of increased tax expenses and higher retention amounts. Regarding debt, the next refinancing requirement is by September, accounting for approximately 9% of the debt. 

SGREIT has renewed its lease with Toshin ahead of its expiry in June 2025, which contributes more than 20% of the portfolio's gross rent. The initial lease term spans 12 years with options for renewal, commencing on 8 June 2025.

For more information, check out:

SREITs Dashboard - Detailed information on individual Singapore REIT

SREITs Data - Overview and details of Singapore REIT

REIT Review - List of previous REIT review posts

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*Disclaimer: The information presented on this blog is for educational and informational purposes only. The materials, including research and opinions, are based solely on my findings and should not be considered professional financial advice or a definitive statement of fact. I cannot guarantee the accuracy, completeness, or reliability of the information provided. I shall not be held liable for any errors, omissions, or losses that may occur as a result of using the information presented on this blog. It should be noted that the information presented on this blog does not constitute a buy, sell, or hold recommendation for any security. It is crucial to conduct your own thorough research and due diligence before making any investment decisions.