Higher revenue from Causeway Point and Yishun 10 Retail Podium helped Frasers Centrepoint Trust (FCT) mitigate a revenue slump from the rebuilding of Northpoint in the latest quarter.

Gross revenue was $43.6 million, down 3.3 per cent year-on-year, due to the high-profile refurbishment project, but net property income was $30.8 million, just 1.3 per cent lower year-on-year.

FCT says 43 leases accounting for 5.2 per cent of its total net lettable area were renewed at an average rental reversion of +0.4 per cent during the quarter. The portfolio average rental reversion for the quarter was affected by Bedok Point, which registered 30.2 per cent lower average rental rate for leases renewed during the quarter.

Excluding Bedok Point, the other five malls in the portfolio achieved an average rental reversion of +5.4 per cent for the quarter. . The portfolio average rental reversion for the nine months year-to-date is +4.3 per cent.

Portfolio occupancy

FCT’s portfolio occupancy as at June 30 was 87.1 per cent, barely changed from the prior quarter. Occupancy at Northpoint (including Yishun 10 retail podium) improved to 65.9 per cent from 60.7 per cent in March 2017 as the rebuilding progressed towards completion, scheduled for September 2017. Occupancy at Changi City Point declined to 84 per cent from 89.7 per cent in the previous quarter, due to transitional vacancy from a new incoming tenant fitting out their space. Occupancy improved to 87.4per cent after this tenant commenced trading on July 1.

Footfall across FCT’s centres was 2.8 per cent less than the same quarter last year and 4.6 per cent down quarter-on-quarter.

“Overall shopper traffic was affected by the lower traffic at Northpoint due to the planned vacancy related to the asset enhancement works. Excluding Northpoint, overall portfolio shopper traffic is 3.7 per cent higher year-on-year and 2.5 per cent higher quarter-on-quarter. Tenant sales for the three months from March to May was 5.9 per cent lower year-on-year, but excluding Northpoint figures, sales were down 3.3 per cent down.

CEO Dr Chew Tuan Chiong said the suburban retail market remains resilient as this sector focuses more on necessity spending and increasingly on food and beverages.

“We see higher shopper traffic at Causeway Point, Changi City Point as well as YewTee Point, compared with the same period a year ago. We expect Northpoint shopper traffic to improve as we progress towards completion of the enhancement this September.”