Frasers Logistics & Commercial Trust (FLCT) posted distributable income of 111.9 million Singapore dollars for the six months ended 31 Mar 2026, slipping 1.0 per cent year-on-year as vacancy pressures and higher land-tax outlays offset stronger rentals and currency gains.
Revenue edged up 2.8 per cent to S$238.9 million. The board declared a distribution per unit (DPU) of 2.95 Singapore cents, down from 3.00 cents a year earlier; the payout will be made on 22 Jun 2026 and equates to an annualised yield of 6.6 per cent based on the 31 Mar closing price.
Adjusted net property income rose 3.6 per cent to S$167.0 million, helped by average portfolio rental reversions of +8.8 per cent (incoming versus outgoing rent) and +22.0 per cent on an average-rent basis. Logistics and industrial (L&I) assets led the performance with +9.4 per cent and +23.2 per cent reversions respectively. Overall portfolio occupancy stood at 96.1 per cent, bolstered by a 99.8 per cent occupancy rate in the L&I segment, while the commercial portfolio was 88.4 per cent let. Weighted average lease expiry remained healthy at 4.9 years.
Performance was lifted by positive rent reviews in Australia and Europe, full-period income from the 2 Tuas South Link 1 property acquired in Nov 2024, and favourable AUD, EUR and GBP exchange rates. These gains were partially offset by the Sep 2025 sale of 357 Collins Street in Melbourne, higher vacancies at Alexandra Technopark and Frasers Business Park in Singapore, and increased non-recoverable land taxes in Victoria and Queensland.
During the quarter to Mar 2026, the REIT secured about 156,000 sq m of new leases and renewals across 14 transactions. Capital management metrics remained solid, with aggregate leverage at 33.7 per cent, a 4.4-times interest-coverage ratio and 75 per cent of borrowings fixed, keeping the weighted average cost of debt at 3.2 per cent per annum.
FLCT continued to pivot toward logistics assets, finalising in Apr 2026 a €43.0 million (S$64.1 million) acquisition of a fully leased freehold logistics facility in Hapert, the Netherlands, with a 9.5-year lease term. Management reiterated its intention to expand the L&I share of the S$7.0 billion portfolio while preserving balance-sheet flexibility.
Chief executive officer Anthea Lee said the trust’s logistics and industrial properties remained the main growth engine amid “a volatile global climate” characterised by elevated rates and currency swings. She noted that prudent capital management and selective acquisitions would underpin “measured growth” even as FLCT monitors geopolitical risks, inflation and foreign-exchange volatility.
Looking ahead, the manager expects global economic momentum to soften through 2026, citing persistent geopolitical tensions and supply-chain disruptions that could sustain inflationary pressures. Nonetheless, it anticipates that demand for well-located prime logistics and industrial space in supply-constrained markets across Australia and Europe will continue to support occupancy and rental growth, while the REIT maintains a cautious stance on office and business-park assets.