FRASERS Centrepoint Trust (FCT) reported a 99.5% committed occupancy rate for its retail portfolio in the first quarter of the financial year ending September 30, 2025.

According to its manager in a business update on Wednesday (Jan 22), this was sustained via proactive asset and property management.

The trust added that key metrics stayed healthy, supported by robust leasing demand. However, retail occupancy decreased slightly, from 99.9% in the same period last year and 99.7% in the previous quarter. Nevertheless, every retail mall within the trust had a committed occupancy of at least 99%.

For the three-month period ending December 31, 2024, tenants' sales increased by 2.5% year-on-year, and shopper traffic at its malls rose by 2.7%.

The manager further stated that it had successfully finished the asset enhancement initiative (AEI) at Tampines 1.

Simultaneously, the Hougang Mall AEI is progressing as planned, with the main contract awarded within the budget.

It reached around 50% pre-commitment before starting the works. With a S$51-million capital expenditure, it aims for a return on investment of about 7%. The mall remains operational.

As of the end of December 2024, the trust's gearing level was relatively steady at 39.3%. This was compared to 37.2% in the same quarter of the previous year and 38.5% in the previous quarter.

Based on net lettable area, the weighted average lease expiry of its portfolio was 2.06 years, and by gross rental income, it was 1.94 years.

The manager remarked that CBRE, a real-estate services firm, anticipates island-wide retail rents to bounce back to pre-Covid levels in 2025. It also emphasized the low risk of new retail space, as private retail supply is projected to increase by less than 1% annually from 2025 to 2027.

Quoting CBRE, it stated, “The scarce retail pipeline, combined with cautiously positive consumer sentiment, may well assist the overall retail market's recovery.” The suburban retail market, it added, demonstrates robust resilience to market fluctuations.

It noted that new housing developments, particularly in the north, north-east, and east, are likely to expand the customer base for FCT's malls in those areas, driving up shopper traffic. Additionally, rising household incomes should underpin growth in retail spending.

The manager said that beneficial government support measures could enhance retail spending power. It added that FCT is “ready to capitalize on these elements for sustainable organic growth”.

Before the announcement, FCT units closed at S$2.11 on Wednesday, down S$0.04 or 1.9%.