Lendlease REIT to Acquire 70% of PLQ Mall in S\$885M Deal: Major Boost to Singapore Retail Portfolio

Key Highlights of the Acquisition

• Acquisition Size: Lendlease REIT will acquire a 70% indirect interest in PLQ Mall at an agreed property value of S\$885.0 million, which is approximately a 2.1% discount to its latest valuation.
• Portfolio Shift: Post-acquisition, Singapore will account for 89% of Lendlease REIT’s portfolio, further solidifying its strategy to focus on Singapore’s resilient retail sector.
• Income Growth: Distribution per unit (DPU) is expected to increase by 2.5% on a pro forma basis, offering immediate accretion to unitholders.
• Financial Prudence: Gearing will rise modestly to 38.3% on a pro forma basis after the acquisition, keeping the REIT within a prudent leverage range.
• Yield: The net property income (NPI) yield on the acquisition is projected at 4.5% based on the agreed property value.
• Funding: Acquisition will be financed through a private placement to raise no less than S\$270.0 million, launched on 5 November 2025.
• Asset Value: Total asset value of Lendlease REIT will increase to S\$3.9 billion after the acquisition and planned Jem Office divestment.
• Suburban Retail Focus: The suburban retail component of the portfolio will expand to 62.7%, with essential services comprising almost 60% of retail gross rental income, reducing tenant concentration risk and enhancing income stability.

Deal Structure and Rationale

Lendlease Global Commercial Trust Management Pte. Ltd., as manager of Lendlease REIT, has agreed to acquire a 70% stake in PLQ Mall by purchasing 70% of the total issued units in PLQM Trust (which holds the mall) and 70% of the trustee-manager of PLQM Trust. The acquisition is not subject to unitholder approval under SGX rules, streamlining completion.

The agreed property value is S\$885.0 million—2.1% below the appraised value by Knight Frank as at 31 October 2025. This favorable entry price signals management’s emphasis on value creation and disciplined capital deployment.

Strategic Significance and Management Commentary

CEO Mr. Guy Cawthra highlighted that this acquisition is a “strategic step forward” for Lendlease REIT, reinforcing its focus on resilient, income-generating suburban retail assets in Singapore. The acquisition is immediately accretive to DPU and maintains financial prudence with gearing at about 38%. The suburban retail component will increase to 62.7%, supported by consumer demand for essential services and stable, recurring income from well-located malls.

PLQ Mall: A Prime, Well-Connected Asset

• Location: 10 Paya Lebar Road, with excellent connectivity—directly at Paya Lebar MRT (East-West & Circle lines) and close to major expressways (PIE, KPE, ECP).
• Profile: Opened in 2019, PLQ Mall is part of the S\$3.6 billion Paya Lebar Quarter mixed-use development. The mall features over 200 retail, dining, and entertainment outlets, including anchor tenants like Haidilao, Uniqlo, Shaw Theatres, and Starbucks Reserve.
• Occupancy: Committed occupancy stands at an impressive 99.7%.
• Lease Profile: Weighted average lease expiry (WALE) by gross rental income is 2.5 years.
• Size: Gross floor area of 452,248 sq ft and net lettable area (NLA) of 317,350 sq ft.
• Tenure: 99-year leasehold from 29 June 2015 (about 89 years remaining).
• Sustainability: Awarded BCA Green Mark Platinum, reflecting Lendlease’s focus on ESG and community-centric design.

Financial Details

• Acquisition Cost: Total cost is S\$246.8 million, covering consideration for units/shares (S\$234.3 million), acquisition fee (S\$6.2 million), and other related fees/expenses (S\$6.3 million).
• Yield: Projected NPI for 2026 is S\$39.5 million, translating to a 4.5% yield based on the agreed property value.
• Funding: Financed through private placement of no less than S\$270.0 million.

Portfolio Impact & Outlook

After the acquisition, Lendlease REIT’s total portfolio value will rise to S\$3.9 billion, with Singapore assets dominating at 89%. This aligns the REIT with its strategy of focusing on higher-yielding, income-stable suburban retail properties in Singapore. The enlarged portfolio is expected to deliver more consistent growth, with a more balanced tenant mix and increased exposure to essential services.

This move could be price sensitive and supportive of the share price, given the immediate DPU accretion, prudent gearing, and quality of the acquired asset. Investors should note the REIT’s continued focus on Singapore’s robust suburban retail sector and disciplined acquisition strategy, which positions it for long-term income growth and resilience.

About Lendlease Global Commercial REIT

Lendlease REIT is a SGX-listed trust with a diversified portfolio of retail and office assets, including Jem, 313@somerset, and three Grade A office buildings in Milan. The REIT is managed by Lendlease Global Commercial Trust Management Pte. Ltd., part of the Australian-listed Lendlease Corporation Limited, which brings integrated capabilities in investments, development, and construction.

Important Notice

This article is for information only and does not constitute investment advice or an offer to purchase any securities. Past performance is not indicative of future results. Investments in REIT units carry risks, including possible loss of principal. Investors should conduct their own due diligence and consult professional advisers before making investment decisions.

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