OUE COMMERCIAL REIT (SGX:TS0U)
OUE Commercial REIT - Relaunch Of Hilton Singapore Orchard
- Lower rental rebates of S$1.1m.
- Hospitality revenue per available room (RevPAR) grew 0.3% q-o-q.
- Committed occupancy of commercial portfolio at 91.2%.
OUECT's 1Q22 business update
- OUE Commercial REIT (SGX:TS0U) announced its 1Q22 business update. Revenue fell 20.3% y-o-y to S$59.5m, while NPI dropped 21.5% y-o-y to S$48.0m during the quarter, attributable to the divestment of a 50% stake in OUE Bayfront and partially offset by lower rental rebates and property expenses.
Shopper traffic and tenant sales improved to ~80% of pre-COVID levels in Mar 2022
- Revenue and NPI of OUE Commercial REIT’s commercial portfolio fell 26.2% and 29.5% y-o-y respectively in 1Q22, mainly due to deconsolidation of OUE Bayfront’s performance post-divestment, partially offset by lower rental rebates of S$1.1m versus S$2.6m in 1Q21 to selected retail tenants.
- As of 31 Mar 2022, committed occupancy of commercial portfolio fell 0.3 ppt q-o-q to 91.2%, due to weaker office committed occupancy in Singapore (-0.4 ppt to 90.8%) while Mandarin Gallery’s committed occupancy increase 2 ppt q-o-q to 88.7%.
- In Mar 2022, both shopper traffic and tenant sales had improved to ~80% of pre-COVID levels for Mandarin Gallery.
- Leasing demand in Shanghai was affected by the Chinese New Year and the COVID-19 outbreak. Management is likely to provide rental rebates to the affected F&B tenants at Lippo Plaza (contributed ~3% of 1Q22 revenue).
Mandarin Orchard was relaunched as Hilton Singapore Orchard
- OUE Commercial REIT’s hospitality portfolio continued to collect minimum rent of S$16.9m under the master lease arrangements in 1Q22. RevPAR at Hilton Singapore Orchard increased 2.1% q-o-q to S$97, after the hotel was relaunched on 24 Feb 2022, driven by higher average room rate. Crowne Plaza Changi Airport continued to serve the air crew and aviation segment during the quarter (with existing contracts expiring in 3Q22) but will open to public bookings from 2Q22.
- Overall, hospitality RevPAR was up 0.3% q-o-q to S$113.
- After adjustments – increasing our risk-free-rate to 2.5% while lowering beta on the back of improving recovery outlook, amongst others – our fair value estimate for OUE Commercial REIT increases marginally from S$0.43 to S$0.44.
- See
Chu Peng
OCBC Investment Research
|
https://www.iocbc.com/
2022-05-17
SGX Stock
Analyst Report
0.44
UP
0.410
