Ascendas REIT’s Portfolio Occupancy Rises To 91.7%
SINGAPORE – Ascendas real estate investment trust (Ascendas REIT) announced that it recorded a portfolio occupancy of 91.7 percent during Q3 2021, up from 91.3 percent during the prior quarter, according to local bourse (SGX) filings published on Tuesday evening (19 October, SGT).
In particular, the trust’s occupancy of its Singapore properties increased from 87.9 percent in Q2 2021 to 88.5 percent during the third quarter. It’s overall weighted average lease expiry (WALE) also reached 3.8 years, and the higher occupancy in the city-state was primarily because of the handover of Grab’s headquarters in July.
Notably, Grab’s headquarters has an overall development cost of S$184.6 million. As a result, Ascendas REIT’s investment properties hit S$16.0 billion during the third quarter.
Grab’s headquarters has a net lettable area of 42,310 sq m and it is 100 percent occupied by Grab as of August 2021. It has a WALE of 11 years, remaining land tenure of roughly 28 years, and net property income (NPI) yield of 6 percent.
However, Ascendas REIT’s rental reversion for lease renewals declined from 8.9 percent in the prior quarter to 3.7 percent during the period under review. Year-to-date, rental reversion has reached 5.4 percent. For the whole of 2021, the manager of Ascendas REIT expects rental reversion to be in the “positive low-single-digit range” due to market uncertainties.
However, leasing demand in the city-state is forecasted to “stay relatively muted” as most businesses have adopted a cautious stance on their expansion plans. Nevertheless, Ascendas real estate investment trust is still upbeat on demand from “new economy” sectors like biomedical sciences, as well as information and communications technologies (ICT).