Frasers Centrepoint Trust Delivers Robust 1Q26 Performance; Strategic Asset Enhancements Signal Growth Potential

Date: 23 January 2026

Key Highlights from 1Q26 Business Update

• Strong Committed Occupancy: The retail portfolio maintained a high committed occupancy rate of 98.1% as of 1Q26, which will rise to 99.9% post-quarter with successful backfilling of cinema spaces at Causeway Point and Century Square. This demonstrates continued robust tenant demand and effective leasing strategies.
• Positive Operational Metrics: Year-on-year growth was recorded in both shopper traffic (+1.3%) and tenants’ sales (+2.7%), reflecting sustained consumer spending and effective mall management, despite ongoing macroeconomic challenges.
• Healthy Capital Management: Aggregate leverage remains prudent at 40.3%, with an average cost of debt at 3.5% and 81.2% of debt hedged to fixed rates. FCT holds a substantial undrawn facility of \$839.5 million, ensuring ample liquidity for future growth and debt refinancing needs. The Trust also boasts a Baa2 (Stable) credit rating from Moody’s, underpinning financial stability.
• Resilient Financial Position: Interest coverage ratio improved to 3.54x, and 90.3% of total borrowings qualify as green loans, reinforcing FCT’s commitment to sustainable financing.

Macroeconomic and Retail Market Conditions

• Singapore GDP Outpaces Expectations: GDP expanded by 5.7% year-on-year in Q4 2025, with full-year growth at 4.8%. CPI inflation remained low at 1.2% y-o-y, providing a stable retail environment.
• Retail Rents and Sales Remain Resilient: Retail sales index (excluding motor vehicles) grew by 5.8% y-o-y in November 2025. FCT’s tenants’ sales rose 4.1%, and F&B sales climbed 4.7% y-o-y. Prime retail rents increased in both Orchard Road (+2.0% y-o-y) and suburban markets (+1.6% y-o-y), underlining healthy demand for quality space.

Portfolio and Asset Enhancement Initiatives (AEIs)

• Hougang Mall AEI: Phase 1 completed in November 2025, with over 80% leasing commitment and 33 new-to-Hougang concepts introduced. The mall is set to benefit from major urban development, including the Hougang interchange for the Cross Island Line and significant residential growth in the North-East region.
• NEX AEI: A major \$90 million AEI will commence in 2Q 2026 (estimated 2-year duration), targeting an ROI of ~7%. Plans include converting 62,000 sf of carpark into 44,000 sf of new retail/office space, retail remixing, and enhanced shopper amenities to solidify NEX’s position as a key suburban retail hub.
• Causeway Point Transformation: FCT is repositioning Causeway Point as the regional mall of Northern Singapore, leveraging new transport nodes (e.g., JB-SG RTS link by end-2026) and a rapidly growing catchment area resulting from substantial residential development and job creation in the North region.

Lease Expiry Profile and Trade Mix

• Diversified Lease Expiry: As at 31 December 2025, lease expiries are well-spread, with no single year exceeding 33% of total GRI, reducing concentration risk. FY26 expiries represent only 17.5% of total GRI.
• Resilient Trade Mix: F&B (38.7%), Beauty & Healthcare (15.5%), and Fashion & Accessories (11.5%) are the top contributors to GRI, reflecting a stable and defensive tenant base. Essential services account for ~54% of the portfolio’s trade mix.

Strategic Priorities and Growth Drivers

• Growth in Shopper Catchment: Singapore plans 138,000 new homes in the next 6-7 years, with over 50,000 units in the North region over 10-15 years. This is expected to increase FCT malls’ catchment population by 25-27%, supporting long-term shopper traffic and sales.
• Population and Income Growth: Median household income grew 3.6% cumulatively (2019-2024), with continued government support measures. These trends underpin resilient demand for suburban retail.
• Limited New Supply: The supply pipeline for new suburban malls remains tight, supporting high occupancy and rental growth.
• Brand Refresh and Placemaking: FCT is revitalising its malls as vibrant, accessible “second places” for communities, with hospitality-inspired service, unified branding, and targeted community engagement to drive footfall and tenant sales.

Financial and Shareholder Considerations

• Debt Maturity and Funding: FCT has sufficient undrawn facilities to refinance all borrowings maturing in FY26. The bulk of its debt is unsecured and green loan facilities are being increased.
• Stable Distributions and Defensive Profile: FCT’s half-yearly distribution schedule, high recurring income, and sustainable capital structure make it a defensive play in the REIT sector.
• Price-Sensitive Developments: The completion of major AEIs, successful tenant remixing, and upcoming transformation of key malls (Hougang Mall, NEX, Causeway Point) are likely to drive both NAV and DPU growth, which could positively impact share price. Strategic positioning to capture growth from new transport and residential developments in the North region is a critical medium-term value driver.

Conclusion

Frasers Centrepoint Trust delivered a strong 1Q26 operating and financial performance, underpinned by resilient suburban retail fundamentals, prudent capital management, and significant growth initiatives. Shareholders should note the price-sensitive potential of the AEI completions, increasing catchment population, and transformation of flagship malls. These factors position FCT to capture future growth and deliver sustained value to unitholders.

Disclaimer: This article is for informational purposes only and does not constitute investment advice or a recommendation to buy or sell any securities. Investors should conduct their own due diligence and consult their financial advisors before making investment decisions. The information is based on the latest disclosures as at 23 January 2026 and may be subject to future updates or changes.

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