Suntec Reit flags near-term pressure on convention business as bookings slow in wake of Iran war

[SINGAPORE] Convention operators in Singapore are seeing near-term pressure on booking momentum, as global uncertainty prompts corporates to hold back on event commitments.

Though there have been no immediate cancellations or postponements, the manager of Suntec Real Estate Investment Trust (Reit) told The Business Times that bookings are slower to firm up, with more organisers adopting a “wait-and-see” approach when confirming events and a more “conservative stance on spending”. 

Likewise, Constellar commercial vice-president Ng Sim Lim noted greater caution among organisers, though they are generally going ahead with events rather than cancelling them “while factoring in potential variability in delegate turnout”.

Constellar is the managing operator of Singapore Expo, the city-state’s largest purpose-built meeting, incentives, conventions and exhibition (Mice) venue.

“Events continue to proceed as planned, with no cancellations to date,” added Ng.

At Suntec Reit’s annual general meeting (AGM) last Thursday (Apr 16), the manager explained that the global uncertainty could also have longer-term knock-on effects, including higher costs for event organisers and international delegates, potentially weighing on Mice demand.

This was the manager’s first AGM since Tang Organization took over as sponsor of Suntec Reit. Controlled by Gordon Tan and his wife Celine, Tang Organization is the parent company of Acrophyte Asset management, which in March acquired Suntec’s manager, previously known as ESR Trust Management (Suntec), for S$190 million.

In March, business events magazine Mix Meetings reported that flight cancellations and rerouting due to restrictions in Middle Eastern airspace have disrupted the flow of high-value participants to major trade fairs and exhibitions in Hong Kong and South-east Asia. 

The conflict has also hit global shipping routes and reduced air-freight capacity – which are both key to trade shows – further straining supply chains and complicating tight setup and teardown schedules. 

“For the conference delegates, costs are expected to increase in tandem with higher airfares and accommodation rates,” the manager added. 

On a positive note, both operators flagged potential short-term upside from displaced events in the Middle East as organisers look to alternative venues in the region. 

Suntec Reit’s manager has already received “a few” enquiries from organisers who are looking to relocate their events from Dubai to Singapore in the second half of the year. 

The manager therefore expects its convention business to remain stable in the year ahead, with a “healthy and stable pipeline of events”. 

Constellar’s Ng echoed the sentiment, saying: “While it is still early to draw firm conclusions, we are seeing organisers reassess their venue locations and explore venues in Asia-Pacific as contingency or alternative options amid uncertainty elsewhere.”

Singapore Expo’s booking pipeline is projected to remain stable this year, with “continued enquiries” for 2026 and 2027. “At this stage, overall event volumes for 2026 are trending slightly ahead of 2025,” Ng explained.

“We continue to engage closely with the Singapore Tourism Board to stay aligned on destination level developments, while maintaining a long-term focus on strengthening Singapore Expo’s value proposition,” he added.  

The Singapore Mice market is likely to continue its growth momentum, especially as the Republic steps up efforts in attracting more business events as part of its long-term tourism strategy, the manager’s interim chairman and non-executive director Lock Wai Han also said in the manager’s annual report released in late March. 

Under the Tourism 2040 plan, authorities intend to treble tourism receipts contributed by the Mice sector by 2040. 

“The performance of Suntec Convention is expected to be stronger with the composition of event types likely to remain largely unchanged,” Lock said. 

In FY2025, Suntec Convention hosted more than 1,100 conferences and corporate events, up 15 per cent from the previous year. 

It contributed about 6.1 per cent of the trust’s total net property income at S$19.4 million, up from S$17.4 million in FY2024. This brought gross revenue to S$471.6 million, 1.7 per cent higher than FY2024’s S$463.6 million. 

Distributable income rose 14.6 per cent year on year to S$207.3 million in FY2025, supported by higher dividend contributions from Suntec Singapore Convention and Exhibition Centre (which includes 42,000 sq m of Mice space and 144,000 sq ft of retail space).  

Distribution per unit rose 13.6 per cent to S$0.07035 for the year, from S$0.06192 a year prior. 

The manager attributed the growth in its event business to ongoing enhancements to its convention offerings in FY2025, allowing it to keep up with the varied demands for event organisers and attract events.  

Beyond its convention segment, the manager is upbeat on the rest of its portfolio. 

At Suntec City Mall, tenant churn is expected as weaker operators exit, creating opportunities to bring in new concepts, it said. Committed occupancy is projected to remain high, alongside positive rental reversion of close to 10 per cent. 

Meanwhile, the Singapore office portfolio remains resilient, with rental reversion of 9.6 per cent recorded in 2025. This is expected to continue into 2026 thanks to “limited new supply and tight vacancies”, Lock noted.