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OUE Commercial REIT - OCBC Investment 2022-07-27: Waiting For Recovery

OUE COMMERCIAL REIT (SGX:TS0U) | SGinvestors.io OUE COMMERCIAL REIT (SGX:TS0U)

OUE Commercial REIT - Waiting For Recovery

  • OUE Commercial REIT's 1H22 DPU declined 12.2% y-o-y to S$0.0108.
  • Tenants’ sales at Mandarin Gallery improved to 85% of pre-pandemic levels.
  • ~S$5m of rental rebates extended to tenants at Lippo Plaza in Shanghai.



OUECT's 1H22 DPU missed expectations

  • OUE Commercial REIT (SGX:TS0U)’s 1H22 revenue and NPI fell 13.3% and 14.2% y-o-y to S$115.8m and S$93.6m respectively, mainly attributable to the divestment of a 50% interest in OUE Bayfront, but partially offset by lower rental rebates and property expenses.
  • 1H22 DPU came in at S$0.0108 which was 12.2% lower compared to 1H21, below our expectations.


Rental reversions for Singapore office properties range from -3.7% to 4%

  • As at 30 Jun 2022, the occupancy rates held up well for OUE Commercial REIT’s Singapore office (92.9%, +2.1 percentage points (ppt) q-o-q) and Mandarin Gallery (90.3%, +1.6 ppt q-o-q), thanks to improving leasing momentum.
  • Average passing rents remained stable for OUE Commercial REIT’s commercial portfolio. Rental reversions for Singapore office properties range from -3.7% to 4% vs –5.9% to 2.5% in 1Q22. OUE Commercial REIT expects flattish rental reversion for Singapore office properties this year.
  • Conversely, Lippo Plaza’s committed office occupancy fell by 3.9 ppt q-o-q to 87.7%, largely due to the non-renewal of a large tenant and weak market conditions in 2Q22. ~S$5.0m of rental rebates were provided to the tenants at Lippo Plaza due to the lockdown in 2Q22.

Hospitality segment’s 2Q22 RevPAR doubled y-o-y






Chu Peng OCBC Investment Research | https://www.iocbc.com/ 2022-07-27
SGX Stock Analyst Report HOLD DOWNGRADE BUY 0.40 DOWN 0.440



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