Lendlease REIT’s Strategic S\$885 Million PLQ Mall Acquisition: Game-Changer for Singapore Retail Exposure and Unitholder Returns

Singapore, 5 November 2025 — Lendlease Global Commercial REIT (“Lendlease REIT”) has announced a landmark acquisition, securing a 70% indirect interest in PLQ Mall, a dominant suburban retail asset in the heart of Paya Lebar Quarter, for S\$885 million. This move not only accelerates Lendlease REIT’s Singapore-centric growth strategy but is also immediately accretive to distribution per unit (DPU), promising significant upside for unitholders.

Key Highlights of the Acquisition

• Attractive Entry Valuation: The agreed property value of S\$885 million (S\$2,789 psf of NLA) reflects a ~2.1% discount to the appraised value of S\$904 million, and is compelling compared to recent suburban mall transactions.
• Robust NPI Yield: The acquisition is expected to deliver a net property income (NPI) yield of 4.5%, positioning PLQ Mall among the top-performing retail assets in Singapore.
• Portfolio Transformation: Post-acquisition, Singapore exposure rises to ~89% of total portfolio, with suburban retail making up ~63%, and portfolio size growing to S\$3.9 billion.
• Strong Operational Metrics: PLQ Mall boasts nearly 100% occupancy, a 2-year tenant sales CAGR of 7.1%, and a carefully curated tenant mix with essential services comprising 60% of rental income.
• Immediate DPU Accretion: Pro forma DPU is expected to rise by approximately 2.5%, with aggregate leverage remaining below 40% (38.3%), providing both growth and financial discipline.
• Clear Pathway to 100% Ownership: Lendlease REIT retains the option to acquire the remaining 30% stake, offering optionality for further portfolio enhancement.

Details Investors Need to Know

1. Financing Structure and Shareholder Impact

The acquisition will be fully funded by a private placement to raise no less than S\$270 million. The purchase consideration for the 70% stake is S\$234.3 million, supplemented by S\$6.2 million in acquisition fees (paid in units) and S\$6.3 million in related expenses. This equity-funded approach maintains prudent leverage and ensures the acquisition is immediately accretive to DPU, a positive signal for investors seeking yield and capital stability.

2. Strengthened Portfolio Resilience

By increasing its weighting towards suburban retail, Lendlease REIT enhances portfolio diversification and income stability. The acquisition also reduces tenant concentration risk, with the top 10 tenants by gross rental income (GRI) contributing only 9.8% post-acquisition (down from 11.8%), and further boosts exposure to essential services to 60%.

3. Prime Asset Quality and Growth Drivers

PLQ Mall is a BCA Green Mark Platinum development with 317,350 sqft of NLA, direct access to two MRT lines (East-West and Circle), and integration with Grade A offices and residential towers. The catchment area exceeds 800,000 people, with expected population and retail spend growth (6-year CAGR: 3.2% for retail spend) driven by upcoming residential and commercial projects—including the Kallang Alive Precinct, integrated healthcare hub, and relocation of Paya Lebar Air Base.

4. Market Position and Competitive Landscape

PLQ Mall is the dominant retail node in its trade area, outperforming Singapore’s average retail spend per capita by 5.5% and benefitting from limited new supply. The Paya Lebar cluster also exhibits the lowest vacancy rates among Singapore’s retail submarkets, supporting rental and occupancy resilience.

5. Execution of Growth-Led, Singapore-Focused Strategy

This acquisition follows the recent divestment of Jem office for S\$462 million and coincides with refreshed leadership and the REIT’s inclusion in the iEdge Singapore Next 50 Index. The transaction underscores management’s intent to drive DPU growth while controlling leverage and focusing on high-quality, income-producing assets in Singapore.

Potential Share Price Catalysts

• DPU Accretion: Immediate boost to unitholder returns, which is often viewed favourably by the market and could drive positive re-rating.
• Portfolio Size and Quality: Enhanced asset scale and quality may improve investor perception and market liquidity.
• Growth Optionality: Right of first refusal for the remaining 30% stake in PLQ Mall offers a clear pipeline for future expansion.
• Suburban Retail Tailwinds: With Singapore’s retail landscape skewed towards suburban malls and limited new supply, PLQ Mall’s performance could exceed expectations in a supportive macro backdrop.

Risks and Considerations

Investors should note that, as with all real estate investments, risks include potential changes in market conditions, interest rate fluctuations, and execution risks related to asset management and integration. The acquisition is subject to successful completion of the equity fundraising and other customary closing conditions.

Conclusion

Lendlease REIT’s strategic acquisition of a majority stake in PLQ Mall marks a pivotal step in its growth journey. With immediate DPU accretion, a stronger, more resilient portfolio, and exposure to favourable demographic and infrastructure trends, this transaction is likely to be price-sensitive and could serve as a catalyst for near-term share price appreciation.

Disclaimer: This article is for informational purposes only and does not constitute investment advice or a recommendation to buy or sell any securities. Please consult your financial advisor before making any investment decisions. The author and publisher are not responsible for any losses arising from reliance on this information. Forward-looking statements are subject to risks and uncertainties, and actual outcomes may differ materially from projections.

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