Frasers Logistics & Commercial Trust (FLT) has reported a significant 55.8% rental reversion for new and renewed logistics leases in the third quarter of the financial year 2025 (3QFY25). This growth is primarily driven by strong demand in Australia and rapid backfilling of vacant space in Singapore, UOBKayHian said in a report.
FLT, which invests in logistics and commercial properties across the Asia Pacific and Europe, has seen its portfolio occupancy slightly decrease by 1.4 percentage points quarter-on-quarter to 92.5% as of June 2025. Despite this, the trust remains optimistic about its prospects, particularly in Australia, where a major 802,400 square foot lease renewal in Melbourne achieved a 72% rental reversion. The trust’s management is confident in filling vacant spaces due to strategic locations, especially in Sydney.
In Singapore, FLT’s logistics property at 2 Tuas South Link 1 experienced a temporary drop in occupancy to 73.5% due to a tenant’s break clause. However, one-third of the vacant space was quickly backfilled, with the remaining space filled by July, restoring occupancy to approximately 90%.
FLT is also pivoting towards logistics, planning to increase its allocation for logistics properties to between 70% and 85% of its portfolio. This strategic shift includes the divestment of non-core office assets, such as the recent agreement to sell 357 Collins Street in Melbourne for $125.5 million (A$195.3 million). The sale is expected to complete by 30 September 2025, reducing FLT’s aggregate leverage and increasing its focus on logistics.
The trust maintains a “buy” recommendation with a target price of $83.5 (S$1.15), reflecting its strategic growth initiatives and robust financial health.
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