Optus: From Breaches to Blackouts and a Record Penalty

TO SAY that Singtel-owned Australian telco Optus is having a hard time would be an understatement. It has been one thing after another for Australia’s second-largest telco these past few years.

In 2022, hackers stole more than two million Optus customers’ personal identification data from the company’s computers. They swept up information such as e-mail addresses and phone numbers and, crucially, birth dates, which serve as a key identifier for many Australian government services.

Optus again hit a rough patch in 2023, when about 10 million customers as well as about 400,000 businesses and several government, health and transport systems were left without service for about 13 hours. Business subscribers were unable to process card payments – the local equivalent of Nets – for the duration of the breakdown.

Then on Sep 24, 2025, the Australian Federal Court issued the enforcement order for a penalty of A$100 million (S$85.2 million) and other undertakings that Optus had agreed with the Australian Competition and Consumer Commission as settlement for doing business in a way that the judge, Patrick O’Sullivan, described as “appalling”.

The judge went on to note that “inappropriate sales practices” occurred between August 2019 and July 2023 that had resulted in “unconscionable conduct”, including inappropriate debt-collection practices, misleading or deceptive conduct, and systemic failure to explain the terms and conditions of contracts. Some were sold mobile plans even though they lived in areas where the Optus network was not available.

And this case was just coming to a conclusion when the company suffered a major outage on Sep 18, 2025. This time, at least three people died after the network failure prevented customers from calling emergency services. Professor Allan Fels, a former competition commission chairman and an influential voice in corporate matters, called for a review of Optus’ licence. South Australian Premier Peter Malinauskas, from one of the affected states, castigated the telco for “incompetence”.

Office S-REITs: Singapore Resilience vs US Headwinds

Office S-Reits, or Singapore-listed real estate investment trusts, were among the hardest-hit sub-sectors during the Covid-19 pandemic. Remote work left many offices empty, and even after the pandemic, recovery has been slow as hybrid work models took root.

But Singapore’s office Reits have since bounced back.

Rental reversions have improved across the board. Keppel Reit : K71U -1.94%, which holds predominantly Singapore office assets, posted a 12.3 per cent rental reversion in the first half of 2025, while Suntec Reit’s : T82U -0.76% office segment recorded a 10 per cent increase.

The picture looks different for S-Reits with office assets in the US. Prime US Reit : OXMU -0.51% posted a reversion of 3.4 per cent in H1 of its financial year, while Keppel Pacific Oak Reit (Kore) : CMOU 0% had a 0.5 per cent increase. Manulife US Reit : BTOU 0% recorded a negative rent reversion of 10 per cent for the same period. The trio also still trade at about a 70 per cent discount to book value, in a stark contrast to their Singapore peers.

Flickers of recovery

That said, there are some glimmers of improvement. Investor sentiment towards the US office sector appears to be stabilising, with signs of renewed confidence.

In September, Prime US Reit raised US$25 million through a private placement at US$0.1935 per unit, and said that it would raise its dividend payout from 10 per cent to at least 50 per cent from H2 FY2025.

Kore : CMOU 0% has also indicated that it will resume dividend payouts from FY2026, with a token distribution planned for H2 FY2025, after suspending payouts in late 2023 as part of its recapitalisation plans. Its rent reversion turned positive at 3.3 per cent in the second quarter, reversing earlier declines.

At the macro level, conditions are also showing tentative signs of stabilisation.

RHB analyst Vijay Natarajan believes “the worst has passed” for US office Reits, noting that demand is slowly returning and deal flows are picking up as American interest rates peak.

Reality check

Even so, recovery remains uneven across the three Reits. Manulife US Reit, for one, continues to face steep challenges. It remains in the midst of asset disposals to pare down debt, having sold Capitol Mall in California (October 2024), 500 Plaza in New Jersey (February 2025), and the 28-storey Peachtree tower in Georgia (May 2025).

In contrast, Prime US Reit and Kore appear to be stabilising. But as Natarajan pointed out, the underlying dynamics of the US and Singapore office markets have diverged significantly.

Over the past few years, US office Reits have suffered from a slower return-to-office trend, lower demand due to companies downsizing, and high interest rates.

While the Fed’s expected rate cuts could lift asset valuations and ease financing pressures, challenges remain.

“We believe the sector has likely passed the worst and there are strong signs of office demand recovery now across the US, which is reflected in increased lease signings,” said Natarajan. “The momentum, if it continues, points to a stronger recovery in 2026.”

However, he warned that key risks remain, such as a volatile US interest rate outlook and the possibility of an economic recession due to tariff impacts.

Not out of the woods yet

For now, the numbers reflect a still-cautious market. The total return of office S-Reits year to date is 16.3 per cent, but US office Reits continue to lag.

Prime US Reit gained 12.4 per cent and Kore, 3.8 per cent, while Manulife US Reit posted negative returns of 20.3 per cent as at Oct 8.

The worst may indeed be behind them, but a sustained rebound is far from certain. Hybrid work arrangements continue to weigh on occupancy rates, and macroeconomic volatility could easily derail fragile gains.

For investors, patience may be the wiser course. Until clearer signs emerge, such as stabilised occupancy and consistent distributions, sitting on the sidelines could prove the more prudent move.

Keppel REIT: S$113m Placement to Fund Sydney Mall Stake

The manager of Keppel Reit on Thursday (Oct 9) announced that the private placement to raise S$113 million for its majority purchase of Top Ryde City Shopping Centre in Sydney, Australia, has closed.

The placement was about three-times covered with strong demand from new and existing unitholders globally, comprising institutional and accredited investors.

The issue price per unit was S$0.983, about a 4.6 per cent discount to the volume-weighted average price of S$1.0304 per unit of all trades from Tuesday until the agreement was signed on Wednesday.

The trading of about 115 million new units is expected to commence on Oct 17.

The purchase of a 75 per cent stake in the freehold mall will cost the real estate investment trust (Reit) A$393.8 million (S$334.8 million) in total, which will be funded through a mix of debt, perpetual securities and the private placement.

Morningstar equity analyst Xavier Lee stated that the acquisition marked a “measured diversification” from the Reit’s office-focused portfolio. However, he noted that its management remained committed to maintaining a Singapore-centric and office-heavy asset base, with retail exposure capped below 20 per cent.

Oil Retreats on Gaza Ceasefire News

Oil prices settled lower on Thursday (Oct 9) after Israel and the Palestinian militant group Hamas signed an agreement to cease fire in Gaza.

Brent crude futures closed down US$1.03, or 1.6 per cent, at US$65.22 a barrel. US West Texas Intermediate crude was down US$1.04, or 1.7 per cent, at US$61.51.

Israel and the Palestinian militant group Hamas signed an agreement on Thursday to cease fire and free Israeli hostages in exchange for Palestinian prisoners, in the first phase of US President Donald Trump’s initiative to end the war in Gaza.

Under the ceasefire deal, fighting will cease, Israel will partially withdraw from Gaza, and Hamas will free all remaining hostages it captured in the attack that precipitated the war, in exchange for hundreds of prisoners held by Israel.

“Crude futures are in a corrective phase as the Israel/Hamas conflict looks to be ending,” said Dennis Kissler, senior vice-president of trading at BOK Financial.

‘Wide-ranging’ implications for oil markets

Indian Prime Minister Narendra Modi said that he spoke to US President Donald Trump on Thursday, adding they “reviewed good progress achieved in trade negotiations” and agreed to stay in close touch over the coming weeks. Trump has imposed a 50 per cent tariff on most exports from India, among the highest for any US trading partner. The tariffs were doubled on Indian goods from 25 per cent over New Delhi’s continued imports of Russian oil.

The US also imposed sanctions on about 100 individuals, entities and vessels, including a Chinese independent refinery and terminal, that helped Iran’s oil and petrochemicals trade, the administration of President Donald Trump said on Thursday.

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