Lendlease Global Commercial REIT’s committed occupancy rises to 88.8% in Q3

The increase was backed by the Sky Complex.

Lendlease Global Commercial REIT logged a portfolio committed occupancy rate of 88.8% during the quarter ending 31 March 2024, up from 87.9% logged in the previous quarter.

The growth was attributed to the positive leasing momentum of Sky Complex (Building 3), where around 8.1% of the net lettable area (NLA) was committed during the quarter. The manager, Lendlease Global Commercial Trust Management Pte. Ltd., continues to project a positive leasing interest from different sectors including telecommunications.

“The leasing progress at Building 3 of Sky Complex is an encouraging step towards our strategic repositioning to secure multi-tenancy at market rents. Moving forward, we will continue to remain focused on prudent capital management to manage cost and gearing,” Lendlease CEO Kelvin Chow said. 

As of the end of March, the manager said office tenants account for 22% of portfolio gross rental income (GRI). This is seen to provide stable revenue for unitholders given the long office weighted average lease expiry of 12.6 years by NLA and 15.1 years by GRI, Lendlease added.

For its retail portfolio, the REIT said it maintained a high committed occupancy rate of 99.4% in the third quarter. It also achieved a positive rental reversion of 15.3% and a healthy retail tenant retention rate of 86.2%.

Tenant sales and visitation also both grew by 2.6% and 6.1%, respectively.

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Lendlease’s gross borrowings during the period were $1.57b with a gearing ratio of 41%. Its weighted average debt maturity was 2.8 years with a weighted average cost of debt of 3.5% annually. The REIT has an interest coverage ratio of 3.4 times which provides ample buffer from its debt covenants of 2.0 times.