Frasers Centrepoint Trust (FCT) saw its stock price surge 3.30% in intraday trading, as investors responded positively to the REIT's recent strategic moves to enhance its portfolio and boost distributions. The trust has been implementing effective methods to increase its distribution per unit (DPU), including successful asset enhancement initiatives (AEIs) and yield-accretive acquisitions.
FCT recently completed an AEI for its Tampines 1 Mall, achieving an impressive return on investment (ROI) of over 8%. The initiative also resulted in the creation of more than 9,000 square feet of new net lettable area in prime retail spaces. Building on this success, the REIT is now embarking on another AEI for Hougang Mall, targeting an ROI of around 7%. These enhancements are expected to drive higher rental income and improve the overall quality of FCT's retail portfolio.
In a significant move to expand its asset base, Frasers Centrepoint Trust recently acquired Northpoint City's South Wing for S$1.17 billion. This strategic acquisition is projected to increase the REIT's fiscal 2024 DPU by 2%, demonstrating FCT's commitment to creating value for unitholders through accretive investments. The combination of successful AEIs and smart acquisitions has positioned FCT favorably in the competitive Singapore REIT market, leading to today's strong stock performance.
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