AG I L I TY &
TENACITY
ANN UAL REPORT
2 0 2 0
Waterway Point
A N N U A L R E P O R T 2 0 2 0 / 1
AG I L ITY &
TENACITY
At Frasers Centrepoint Trust, we believe having the right focus, relevant scale, and
local expertise are critical success factors for retail real estate. This will give us a
sustained competitive advantage, while placing us in a stronger position to deliver
long-term unitholder value. As we navigate through a volatile, uncertain, complex and
ambiguous operating environment, we must be agile and tenacious as an organisation
to be able to be sustainable over the long term.
In the face of adversity, we are investing with agility to strengthen our organisational
culture and structure, ensuring quality and consistent systems and processes across
our businesses. We demonstrate tenacity by strengthening FCT’s well-diversified
portfolio with earnings underpinned by a resilient base of retail properties generating
recurring income.
We will continue to evolve, reinvent and thrive as a Retail REIT in the post COVID-19
world, as we remain committed to sustainable value creation and delivering steady
returns for our stakeholders.
CONTENTS
Asset Portfolio
50
52
54
Overview
02
03
04
05
06
08
10
12
16
20
22
About Frasers Centrepoint Trust
Structure of FCT and Organisation
Structure of the Manager
Business Objectives and Growth Strategies
FY2020 Highlights
Key Events
5-Year Performance at a Glance
Unit Price Performance
Letter to Unitholders
Board of Directors
Trust Management Team
Investor Relations
56
58
60
62
64
66
67
70
FCT Portfolio Overview
Causeway Point
Northpoint City North Wing and Yishun 10
Retail Podium
Waterway Point
Changi City Point
Bedok Point
YewTee Point
Anchorpoint
Mall Directory
Investment in AsiaRetail Fund Limited
Investment in Hektar REIT
Business Review
26
34
36
Operations & Financial Review
Capital Resources
Retail Property Market Overview
Risk Management, Sustainability Report &
Corporate Governance
72
74
101
Risk Management
Sustainability Report
Corporate Governance Report
Financial Information
137
Financial Statements
Other Information
212
213
217
219
Use of Proceeds
Statistics of Unitholdings
Additional Information
Notice of Annual General Meeting
Proxy Form
2 / F R A S E R S C E N T R E P O I N T T R U S T
ABOUT
FRASERS CENTREPOINT TRUST
Changi City Point
Frasers Centrepoint Trust (“FCT”) is a
leading developer-sponsored retail
real estate investment trust (“REIT”).
After acquiring the remaining
interest in AsiaRetail Fund Limited
(“ARF”) on 27 October 20201, FCT has
become one of the largest suburban
retail mall owners in Singapore with
total assets of approximately S$6.7
billion. FCT’s enlarged Singapore
portfolio comprises 11 retail malls
and an office building located in the
suburban regions of Singapore. These
properties are near homes and within
minutes to transportation amenities.
The Singapore retail portfolio has
over 2.3 million square feet of net
lettable area with over 1,500 leases
with a strong focus on necessity
spending, food & beverage and
essential services.
The Singapore portfolio comprises 11
retail properties, namely, Causeway
Point, Northpoint City North
Wing (including Yishun 10 Retail
Podium), Anchorpoint, YewTee Point,
Changi City Point, Waterway Point
(40%-interest), Tiong Bahru Plaza,
White Sands, Hougang Mall, Century
Square and Tampines 1 and an office
property, Central Plaza. FCT’s malls
enjoy stable and recurring shopper
footfall supported by commuter
trafficand residential population in
the catchment areas.
FCT also holds a 31.15% stake in
Hektar Real Estate Investment Trust,
a retail-focused REIT in Malaysia
listed on the Main Market of Bursa
Malaysia Securities Berhad.
FCT is an index constituent of
several benchmark indices including
the FTSE EPRA/ NAREIT Global
Real Estate Index Series (Global
Developed Index), the FTSE ST Real
Estate investment Trust Index, the
MSCI Singapore Small Cap Index and
the SGX iEdge S-REIT Leaders Index.
Listed on the Main Board of the
Singapore Exchange Securities
Trading Limited since 5 July
2006, FCT is managed by Frasers
Centrepoint Asset Management Ltd.,
a real estate management company
and a wholly-owned subsidiary of
Frasers Property Limited.
1
FCT announced on 3 September 2020 the acquisition of the remaining 63.11% interest in AsiaRetail Fund Limited (the “ARF Acquisition”) which it does not
own. The ARF Acquisition was approved at an Extraordinary General Meeting on 28 September 2020. The ARF Acquisition was completed on 27 October
2020 and FCT now owns 100% interest in ARF whose property portfolio comprises Tiong Bahru Plaza, White Sands, Hougang Mall, Century Square,
Tampines 1 and Central Plaza.
A N N U A L R E P O R T 2 0 2 0 / 3
STRUCTURE OF
FRASERS CENTREPOINT TRUST
Frasers Centrepoint Trust Unitholders
Holdings of Units in
Frasers Centrepoint Trust
Distributions
Manager
Frasers Centrepoint Asset
Management Ltd.
Management
Services
Management
Fees
Acts on behalf of
Unitholders
Trustee
Fees
Trustee
HSBC Institutional Trust
Services (Singapore)
Limited
Ownership of Assets
Net Property Income
Property Manager
Frasers Property Retail
Management Pte Ltd.
Property
Management
Services
Property
Management
Fee
FCT Portfolio Properties1
Causeway Point
Northpoint City North Wing,
including Yishun 10 retail podium
Waterway Point (40% stake)
Changi City Point
YewTee Point
Anchorpoint
1
The divestment of Bedok Point, which was approved by Unitholders at an extraordindary general meeting convened on 28 September 2020, has been
completed on 9 November 2020.
ORGANISATION STRUCTURE
OF THE MANAGER
The Manager
Frasers Centrepoint Asset Management Ltd
The Board of Directors
Nominating and Remuneration Committee
Audit, Risk and Compliance Committee
Chief Executive Officer
Investor Relations
Finance
Investment & Asset Management
Contents
4 / F R A S E R S C E N T R E P O I N T T R U S T
BUSINESS OBJECTIVES
AND GROWTH STRATEGIES
FCT is a real estate investment trust set up to own and invest in income producing properties or properties that could
be developed or redeveloped into income-producing properties, used primarily for retail purposes in Singapore and
overseas.
FCT’s objectives are to deliver regular and stable distributions to unitholders of FCT (“Unitholders”) and to achieve long-
term growth in its net asset value, so as to provide Unitholders with competitive rate of returns for their investments.
Frasers Centrepoint Asset Management Ltd. (“FCAM”), the Manager of FCT, sets the strategic direction for FCT and this
includes making recommendations to HSBC Institutional Trust Services (Singapore) Limited, as the Trustee of FCT, on
acquisitions, divestments and enhancement of assets. FCAM also oversees the overall management of FCT’s portfolio of
investment properties, including the capital and risk management.
FCT’s growth strategies comprise three growth drivers – acquisition growth, enhancement growth and organic growth.
ACQUISITION GROWTH
ORGANIC GROWTH
RISK MANAGEMENT
Identifying and pursuing growth
opportunities via acquiring
additional income-producing
properties and properties that
could be developed or redeveloped
into income-producing properties.
The acquisitions should meet FCT’s
investment objectives to enhance
yields and returns for Unitholders
while improving portfolio
diversification. The acquisition
opportunities include Sponsor’s
pipeline assets and third party assets,
in Singapore and overseas.
Active lease management to
achieve positive rental reversions,
and maintaining healthy portfolio
occupancy to provide steady
rental growth.
FCAM adopts prudent capital and risk
management strategies in its course
of business.
Effective risk management is a
fundamental part of FCT’s business
management. Key risks, mitigating
measures and management actions
are continually identified, reviewed
and monitored by management
as part of FCAM’s enterprise-wide
risk management framework.
Recognising and managing risks
are central to the business and to
protecting Unitholders’ interests.
CAPITAL MANAGEMENT
FCAM continues to maintain a
prudent financial structure and
adequate financial flexibility to
ensure that it has access to capital
resources at competitive cost.
FCAM proactively manages FCT’s
cash flows, financial position, debt
maturity profile, costs of capital,
interest rates exposure and overall
liquidity position.
ENHANCEMENT GROWTH
This includes change of configuration
and layout of the properties to
achieve better asset yield and
sustainable income growth; and
to achieve value creation through
Asset Enhancement Initiative (“AEI”)
to improve the income producing
capability of the properties.
FY2020
HIGHLIGHTS
GROSS
REVENUE
S$164.4 million
16.3% year-on-year
NET PROPERTY
INCOME
S$110.9 million
20.4% year-on-year
FY2020 revenue and net property income fell 16.3%
and 20.4% year-on-year, respectively. The financial
performance was impacted by rental rebates dispensed in
2H20 to help tenants cope with challenges arising from
COVID-19. The total amount of rental rebates dispensed
was S$27.4 million. Excluding the impact from the rental
rebates, FY2020 revenue and NPI would have decreased
2.4% and 0.7% year-on-year, respectively.
DISTRIBUTION
PER UNIT
9.042 S cents
25.1% year-on-year
Distribution per unit (“DPU”) for FY2020 was 9.042 S cents,
which is 25.1% lower than the 12.07 S cents DPU in FY2019.
The lower DPU was mainly due to the decline in financial
performance which was impacted by the rental rebates to
help tenants cope with challenges from COVID-19.
A N N U A L R E P O R T 2 0 2 0 / 5
APPRAISED VALUE OF
PROPERTY PORTFOLIO
S$2,857 million
0.4% year-on-year
Total appraised value of FCT’s portfolio of investment
properties as at 15 September 20201 stood at S$2,857
million, compared with S$2,846 million a year ago. The
appraised values of Causeway Point, Northpoint City
North Wing, Changi City Point, and YewTee Point were
relatively stable compared to a year ago. The smaller
properties Anchorpoint and Yishun 10 saw declines of
3.1% and 7.9% to their respective appraised value. Bedok
Point registered a S$14 million or 14.9% gain in appraised
value, based on the divestment price of the property
announced on 3 September 20201. The appraised value of
Waterway Point remained unchanged at S$1,300 million2.
NET ASSET VALUE AND
NET TANGIBLE ASSET PER UNIT
S$2.27
2.7% year-on-year
FCT’s NAV and NTA as at 30 September 2020 stood at
S$2.27 per unit3 which is 2.7% higher than the NAV and
NTA of S$2.21 a year ago. The gain was attributed to the
increased stake in AsiaRetail Fund Limited (“ARF”) and
revaluation gain of the FCT portfolio properties.
GEARING
LEVEL
35.9%4
3.0%-point year-on-year
FCT’s gearing stood at a healthy level of 35.9%4,
compared to average of 37.6%5 in the S-REITs industry.
1
2
3
4
Bedok Point’s appraised value was based on the sale price of Bedok Point in the proposed divestment of Bedok Point as announced on 3 September
2020. The sale price was arrived at after taking into account the independent valuations conducted by Jones Lang LaSalle Property Consultants Pte. Ltd.
(“JLL”) (commissioned by HSBC Institutional Trust Services (Singapore) Limited (in its capacity as trustee of FCT)) and Colliers International Consultancy &
Valuation (Singapore) Pte. Ltd. (“Colliers”) (commissioned by the Company). JLL, in its report dated 1 August 2020, had stated that the open market value
of Bedok Point as at 1 August 2020 was S$108.9 million and Colliers, in its report dated 1 August 2020, had stated that the open market value of Bedok
Point as at 1 August 2020 was S$107.2 million.
FCT owns 40.0% of Sapphire Star Trust which holds Waterway Point. S$1,300 million is the total value of the retail property and FCT’s 40.0% interest
amounts to S$520 million.
Includes the distribution to be paid for the second half of the financial year 2020.
In accordance with Property Funds Appendix, the gearing ratio included FCT’s proportionate share (40%) of deposited property value and borrowings in
Sapphire Star Trust (which owns Waterway Point).
5 Weekly S-REITS Tracker, 16 November 2020, OCBC Investment Research.
Contents
6 / F R A S E R S C E N T R E P O I N T T R U S T
KEY
EVENTS
Changi City Point
Northpoint City
OCTOBER 2019
• FCT announced the increase
in shareholding in ARF from
approximately 21.13% to
approximately 24.82%, due to
shares in the capital of ARF being
redeemed pursuant to ARF’s
bye-laws on 30 September 2019
• FCT announced full year results for
FY2019 with total DPU at a new
high of 12.07 S cents
MARCH 2020
• Moody’s downgraded FCT’s issuer
rating to Baa2 from Baa1 and
changed the outlook on the rating
from stable to negative
• FCT and Frasers Property Retail
announced extended Tenant
Support Package with additional
S$45 million in rental rebates for
tenants to help ease the business
impact of COVID-19
JUNE 2020
• FCT announced the acquisition of
an additional 12% interest in ARF
for S$197.2 million. The acquisition
would raise FCT’s interest in ARF to
36.89% from 24.82%
JULY 2020
• FCT announced the completion of
the acquisition of the additional
12% interest in ARF
• FCT announced business updates
JANUARY 2020
• Mr Philip Eng retired as Non-
APRIL 2020
• Standard & Poor’s downgraded
for 3Q20
executive and Non-Independent
Director on the Board and as a
member of the Audit, Risk and
Compliance Committee as part of
planned transition
• Mr Low Chee Wah was appointed as
Non-Executive and Non-Independent
Director of the Manager
• FCT held its 11th Annual General
Meeting on 13 January 2020 and
all resolutions proposed were
duly passed
• 1Q20 results announcement:
1Q20 DPU up 1.3% year-on-year to
3.06 S cents
FEBRUARY 2020
• FCT and Frasers Property Retail
announced Tenant Support
Package to help tenants across
Frasers Property Group’s combined
retail portfolio of 14 malls to
overcome the business impact of
COVID-19
FCT’s issuer credit rating and senior
unsecured notes issued by FCT
MTN Pte. Ltd. and guaranteed by
FCT to BBB from BBB+ and placed
the ratings on CreditWatch with
negative implications
• FCT announced financial results
for 2Q20 and DPU of 1.61 S cents,
down 48.7% year-on-year due to
retention of 50% of distributable
income to preserve financial
flexibility due to uncertainties
arising from COVID-19
• FCT announced issue of S$200
million 3.20 per cent. Fixed Rate
Notes Due 2023
MAY 2020
• FCT announced the change to
half-yearly reporting of financial
results and to half-yearly
distributions, following the
amendments to Rule 705(2) of the
SGX-ST Listing Manual which took
effect from 7 February 2020
SEPTEMBER 2020
• FCT announced the proposed
acquisition of approximately
63.11% of the total issued share
capital of ARF for approximately
S$1.06 billion (“Proposed ARF
Acquisition”) and the proposed
divestment of Bedok Point for
S$108 million (“Proposed Bedok
Point Divestment”)
• Moody’s affirmed FCT’s Baa2 rating
and changed outlook to stable
from negative
• S&P Global Ratings affirmed FCT’s
“BBB” long-term issuer rating with
stable outlook and “BBB” issue
ratings on the outstanding senior
unsecured notes issued by FCT
MTN Pte. Ltd. and guaranteed by
FCT and removed the ratings from
CreditWatch where they were
placed with negative implications
in April 2020
• FCT announced the valuation of its
portfolio properties
A N N U A L R E P O R T 2 0 2 0 / 7
Causeway Point
YewTee Point
• FCT and the Securities Investors
Association (Singapore) (SIAS)
organised a virtual dialogue
session for Unitholders of FCT
in relation to the Proposed ARF
Acquisition and Proposed Bedok
Point Divestment
• FCT announced the responses
to the substantial and relevant
questions from Unitholders
and presentation by CEO on
26 September 2020, prior to the
Extraordinary General Meeting
(“EGM”) on 28 September 2020
• FCT held its EGM on 28 September
2020 and all resolutions in relation
to, inter alia, the Proposed ARF
Acquisition and the Proposed
Bedok Point Divestment were
duly passed
SUBSEQUENT EVENTS
October 2020
• 244,681,000 new FCT units were
issued pursuant to the private
placement under the EFR
• FCT announced the launch of the
non-renounceable preferential
offering (“Preferential Offering”).
The issue price of each new FCT
unit under the Preferential Offering
was S$2.34
• FCT announced the results of
the Preferential Offering. The
Preferential Offering raised
gross proceeds of approximately
S$759.7 million. Together with the
gross proceeds from the private
placement, the EFR raised total
gross proceeds of approximately
S$1,334.7 million
• FCT announced the launch of an
• FCT released the minutes of the
equity fund raising (“EFR”) to raise
gross proceeds of no less than
approximately S$1,327.3 million
by way of private placement and
preferential offering. The Manager
intends to use the net proceeds
from the EFR to part-finance the
total cost of the Proposed ARF
Acquisition and to pare down
existing indebtedness
• FCT announced that it raised
S$575 million from the private
placement which was 2.8 times
subscribed amid strong demand
from new and existing institutional
and other accredited investors. The
issue price of the new FCT units
under the private placement was
S$2.35 per new FCT unit
EGM held on 28 September 2020
• 324,639,666 new FCT units were
issued pursuant to the Preferential
Offering under the EFR
• FCT announced the completion of
the Proposed ARF Acquisition
November 2020
• FCT announced the full year
financial results for FY2020:
FY2020 DPU decreased 25.1%
year-on-year to 9.042 S cents due
to COVID-19 pandemic
• FCT announced the completion of
the Bedok Point Divestment
Contents
8 / F R A S E R S C E N T R E P O I N T T R U S T
5-YEAR PERFORMANCE
AT A GLANCE
Revenue (S$ million)
Net Property Income (S$ million)
183.8
181.6
193.3
196.4
164.4
129.9
129.6
137.2
139.3
110.9
FY2016
FY2017
FY2018
FY2019
FY2020
FY2016
FY2017
FY2018
FY2019
FY2020
Distribution per Unit (S cents)
Net Asset Value per Unit (S$)
11.764
11.9
12.015
12.07
9.042
2.02
2.08
1.93
2.21
2.27
FY2016
FY2017
FY2018
FY2019
FY2020
FY2016
FY2017
FY2018
FY2019
FY2020
Total Assets (S$ million)
Gearing (%)
3883.4
3610.9
35.91
32.91
28.3
29.0
28.6
2750.9
2840.4
2594.5
FY2016
FY2017
FY2018
FY2019
FY2020
FY2016
FY2017
FY2018
FY2019
FY2020
1
In accordance with Property Funds Appendix, the gearing ratio included FCT’s proportionate share (40%) of deposited property value and borrowings in
Sapphire Star Trust (which owns Waterway Point)
A N N U A L R E P O R T 2 0 2 0 / 9
Distribution per Unit by Quarters (S cents)
3.039
3.04
2.87
2.815
2.89
3.04
3.00
2.97
3.00
3.10
3.053
2.862
3.137
3.02
3.00
2.913
4.372
3.06
1.61
FY2016
FY2017
FY2018
FY2019
FY2020
Total DPU: 11.764 cents
Total DPU: 11.90 cents
Total DPU: 12.015 cents
Total DPU: 12.07 cents
Total DPU: 9.042 cents
Q1 • Q2 • Q3 • Q4 • 2H20202
2
FCT has moved to half-yearly financial announcement and half-yearly distribution payment with effect from the second half of its financial year 2020.
The announcement was made on 13 May 2020. This follows the amendment of SGX’s listing manual (Rule 705(2)) that allows issuers to move to half
yearly reporting which took effect from 7 February 2020. Accordingly, there was no DPU announcement/payment for financial quarter 3Q2020 (April-
June 2020).
Group
For the Financial Year ended 30 September
FY2016
FY2017
FY2018
FY2019
FY2020
Selected Income Statement and Distribution Data ($‘000)
Gross Revenue
Net Property Income
Distributable Income
183,816
181,595
193,347
196,386
164,377
129,852
129,558
137,186
139,283
110,888
108,101
110,615
111,316
118,718
101,146
Selected Balance Sheet Data ($ Million)
Total Assets
Total Borrowings
Net Assets
2,594.5
2,750.9
2,840.4
3,610.9
3,883.4
734.0
798.0
813.0
1,042.0
1,255.0
1,775.6
1,872.2
1,933.8
2,471.0
2,538.3
Value of Portfolio Properties1
2,509.0
2,668.1
2,749.0
2,846.0
2,749.52
Other Financial Indicators
Distribution per Unit (S cents)
Net Asset Value per Unit ($)
11.764
11.90
12.015
12.070
1.93
2.02
2.08
2.21
9.042
2.27
Ratio of Total Borrowings to Total Assets (Gearing)
28.3%
29.0%
28.6%
32.9%3
35.9%4
Interest Coverage (Times)
7.33
6.85
6.25
5.74
4.95
Market Capitalisation (S$ million)
2,021.2
1,946.4
2,102.9
3,058.6
2,675.55
1
2
3
4
5
The investment properties are: Causeway Point, Northpoint City North Wing (including Yishun 10 retail podium), Anchorpoint, YewTee Point, Bedok
Point and Changi City Point. The 40%-interest in Waterway Point is held as investment in joint venture.
Bedok Point was earmarked for divestment as announced on 3 September 2020 and Unitholders’ approval was obtained at an extraordinary general
meeting held on 28 September 2020. Accordingly, Bedok Point was reclassed from Investment Properties under non-current assets to Assets Held for
Sale under current assets. The value of the investment properties shown here excludes the value of Bedok Point.
Included the distribution to be paid for the last quarter of the Financial Year.
In accordance with the Property Funds Appendix, the gearing ratio includes FCT’s proportionate share (40%) of deposited property value and assets and
underlying borrowings (40%) in Sapphire Star Trust (which owns holds the retail property Waterway Point).
Based on total outstanding 1,119,447,127 issued units and FCT’s closing price of S$2.39 as at 30 September 2020.
Contents
1 0 / F R A S E R S C E N T R E P O I N T T R U S T
UNIT PRICE
PERFORMANCE
FCT’S UNIT PRICE AND TOTAL RETURN WERE AFFECTED BY THE COVID-19 PANDEMIC
FCT unit price closed at S$2.39 on 30 September 2020. This represents a unit price decline of 12.77% and a total return
of -10.25% during the year under review. FCT’s unit price fell in line with the key benchmark indices after the first
week of March 2020 following the rapid rise in new COVID-19 cases worldwide and the declaration of COVID-19 as a
pandemic by the World Health Organisation. FCT unit price hit a trough of S$1.64 on 3 April 2020, falling 46.1% from
the peak of S$3.04 on 5 March 2020.
Table: 1 Year FCT Unit price performance versus FTSE REIT Index and FTSE Straits Times Index
120%
110%
100%
90%
80%
70%
60%
50%
40%
FSTREI 90.54%
FCT 87.23%
STI 79.06%
Oct19
Nov19
Dec19
Jan20
Feb20
Mar20
Apr20
May20
Jun20
Jul20
Aug20
Sep20
Source: Bloomberg
During the year under review, FCT’s total return underperformed the FTSE REIT Index by 482 basis points but
outperformed the FTSE Straits Times Index by 733 basis points. Over a longer three- and five-year period, FCT’s total
returns stood at 29.64% and 61.06%, as shown in the table below:
1 Year
1 October 2019 to 30 September 2020
3 years
1 October 2017 to 30 September 2020
5 years
1 October 2015 to 30 September 2020
Price Change
%
Total Return1
%
Price Change
%
Total Return1
%
Price Change
%
Total Return1
%
FCT
FTSE REIT Index
FTSE Straits Times Index
EGAS
-12.77%
-10.25%
-9.46%
-20.94%
-25.46%
-5.43%
-17.58%
-22.52%
13.37%
4.10%
-23.39%
-10.16%
29.64%
22.21%
25.57%
20.72%
-13.93%
-11.62%
0.38%
-5.36%
61.06%
61.38%
6.67%
13.38%
Source: Bloomberg
1 Assumes the distributions are reinvested
INCREASE IN FCT’S TOTAL AND FREE-FLOAT MARKET CAPITALISATION AFTER THE COMPLETION OF THE EFR
IN OCTOBER 2020
Following the announcements of the Acquisition of the remaining 63.11% interest in ARF on 3 September 2020 and the
approval from Unitholders at an extraordinary meeting held on 28 September 2020, FCAM announced the launch of the
EFR to raise gross proceeds through the offering of new units in FCT (the “New Units”) by way of a private placement
(“Private Placement”) and Preferential Offering. The EFR raised gross proceeds of approximately S$1,334.7 million
through the issuance of approximately 569.32 million New Units, of which approximately 244.68 million New
Units were issued and listed on the SGX on 7 October 2020 following the completion of the Private Placement,
and approximately 324.64 million New Units were issued and listed on the SGX on 27 October 2020 following the
completion of the Preferential Offering. Following the issuance of the New Units, FCT’s total issued units as at
A N N U A L R E P O R T 2 0 2 0 / 1 1
27 October 2020 was 1,688,767,793, which is approximately 51% larger than before the EFR. The larger issue unit base
led to an improvement in total and free-float market capitalisation of FCT.
As at 27 October 2020, FCT’s total and free-float market capitalisation were approximately S$3.90 billion and
S$1.59 billion, respectively. FCT’s total and free-float market capitalisation on 30 September 2020 was approximately
S$2.68 billion and S$978 million, respectively. The increase in total and free-float market capitalisation is expected to
raise FCT’s index weightage in indices such as the FTSE EPRA/NAREIT Global Real Estate Index Series (Global Developed
Index), of which FCT is an index constituent.
FCT MONTHLY TRADING PERFORMANCE IN FY2020
FCT’s trading volume and the unit closing price for each month in FY2020 is shown in the chart below. The average daily
trading volume in FY2020 was 3.28 million units, which is about 71% higher compared with the same period in the
previous year.
Trading Performance in FY2020
Total volume traded in the month (million of units)
Closing Price as at the last trading day of the month (S$)
300
250
2.75
2.76
2.81
2.88
2.79
43.03
50.92
45.57
44.07
56.13
2.13
149.93
2.24
106.10
2.43
2.31
2.38
2.52
2.39
80.30
62.88
45.01
40.88
96.01
200
150
100
50
0
Oct19
Nov19
Dec19
Jan20
Feb20
Mar20
Apr20
May20
Jun20
Jul20
Aug20
Sep20
Closing Price as at the last trading day of the month (S$) • Total volume traded in the month (million of units)
3.50
3.00
2.50
2.00
1.50
1.00
0.50
0.00
TRADING PERFORMANCE IN THE PAST FIVE FINANCIAL YEARS
With the exception of the second half of FY2020 due to the impact from COVID-19, FCT units have generally traded
well with higher unit closing prices in each of the preceding four financial years. FCT’s average daily volume has also
improved over the years, rising from less than 1 million units in FY2016 to 3.28 million in FY2020, a rise of almost
2.5 times. The table below shows the historical trading information of FCT units in the past five financial years.
FY2016
FY2017
FY2018
FY2019
FY2020
Opening price (S$)
Closing price (S$)1
Highest closing price (S$)
Lowest closing price (S$)
Total volume traded (million units)
Average daily trading volume (million units)
Market capitalisation2 (S$ billion)
1.905
2.200
2.210
1.800
239.4
0.950
2.021
2.200
2.110
2.190
1.870
254.5
1.014
1.946
2.110
2.270
2.360
2.120
271.2
1.085
2.103
2.270
2.740
2.850
2.140
478.5
1.916
3.059
2.730
2.390
3.040
1.640
820.8
3.283
2.675
Source: Bloomberg
1
2
Based on the closing price as at the last trading day for the respective financial year
Based on the closing price and issued Units as at the last trading day for the respective financial year
Contents
1 2 / F R A S E R S C E N T R E P O I N T T R U S T
RICHARD NG
Chief Executive Officer
CHEONG CHOONG KONG
Chairman
A N N U A L R E P O R T 2 0 2 0 / 1 3
LETTER TO
UNITHOLDERS
Dear Unitholders,
We are pleased to present Frasers Centrepoint
Trust (“FCT” and the “Trust”)’s Annual Report and
Sustainability Report for the financial year ended
30 September 2020 (“FY2020”).
TENACITY AND AGILITY AMID COVID-19
UNCERTAINTIES
The scale and extent of impact from COVID-19
have left deep scars on our economy and nation.
The retail sector is undoubtedly one of the hardest-
hit sectors of the economy, especially during the
Circuit Breaker period. Many businesses, except
those in the essential trades, were ordered to shut;
F&B outlets were only allowed to do takeaways
and delivery orders; and strict safe distancing and
crowd control measures were enforced. Within
FCT’s portfolio, only between 30% and 40% of the
tenants stayed open during this period.
FCT, together with its sponsor, Frasers Property
Limited, rolled out two tenant support packages
in February and March 2020 to help tenants cope
with operation and cashflow challenges. However,
the unprecedented scale and extent of impact
from the subsequent Circuit Breaker measures
necessitated far more substantial assistance for
the tenants through the provision of a total of
four months of rental rebates. Half of the rebates,
amounting to two months of rent, was provided
by the landlords, while the remaining half was
supported by the Singapore government through
property tax rebates and cash grants. Apart from
aiding tenants with rental rebates, FCT is actively
working with tenants on a targeted approach
to help them get back on track as the situation
continues to improve.
On the ground, our frontline colleagues in the
essential services such as mall management,
security, customer service and hygiene
maintenance, continue to work tirelessly under
tremendous pressure to keep everybody safe while
ensuring strict compliance with safe-distancing
control measures. Together, we have emerged
stronger, having been through unprecedented
times battling stress and disruption during the
Circuit Breaker and into the phased re-opening of
the economy. We are thankful to all our colleagues
and stakeholders, for their tenacity and their
agility in times of uncertainty.
Notwithstanding the COVID-19 challenges, our
team remained steadfast in following through on
FCT’s long-term growth strategy, completing a
remarkable series of transactions that amounted
to the closure of deals exceeding one billion
Singapore dollars, all while working from home.
In July 2020, FCT completed the acquisition of a
12.1% stake in ARF for S$197.2 million to raise
its stake in ARF to 36.9%. FCT subsequently
announced on 3 September 2020 to acquire the
remaining 63.1% stake in ARF for S$1.06 billion
(“ARF Acquisition”) and an Equity Fund Raising
(“EFR”) to raise equity to, inter alia, fund the
ARF Acquisition. The EFR raised about S$1.33
billion in gross proceeds, the largest amount
raised for a secondary offering in the S-REIT
space. In connection with the ARF Acquisition, an
extraordinary general meeting was convened on
28 September 2020 with all tabled resolutions
duly approved by unitholders. FCT’s full ownership
of the ARF portfolio marks the completion of a
journey that started in February 2019, with the
acquisition of an initial 17.1% stake in ARF by FCT
and 17.8% stake by Frasers Property Limited.
REVIEW OF FY2020 PERFORMANCE
Financial performance mainly impacted by
landlord’s rental rebates
FCT’s financial performance in FY2020 was
significantly impacted by rental rebates assistance
granted to tenants in the second half of FY2020.
These rebates were part of the tenant support
packages rolled out by FCT and its sponsor, Frasers
Property Limited, to help tenants cope with
COVID-19 challenges. This is in addition to the
various property tax rebates and cash grants which
FCT has passed through to all eligible tenants.
Revenue for FY2020 fell 16.3% year-on-year
(“y-o-y”) to S$164.4 million and net property
income fell 20.4% y-o-y to S$110.9 million, mainly
due to the impact from S$27.4 million in rental
rebates provided to tenants. Excluding this impact,
the y-o-y decline in revenue and net property
income would have been more benign at 2.4% and
0.7%, respectively.
Contents
1 4 / F R A S E R S C E N T R E P O I N T T R U S T
LETTER TO
UNITHOLDERS
The distribution to unitholders for the full year was
S$101.1 million, 15.5% lower y-o-y. The decline
in distribution was partially offset by the release
of the retained distribution of S$18.0 million from
1H20 and the full year contributions of dividend
received from FCT’s investments in ARF and
Sapphire Star Trust (“SST”)1.
Distribution per Unit for the full year was
9.042 S cents, which is 25.1% lower than the
previous year.
FCT has fulfilled all the mandatory obligations in
rental rebates. While it is still extending rental help
for tenants who are unable to resume business,
such as family karaokes and travel agencies, these
tenants currently account for less than 1% of FCT’s
net lettable area. Help is also extended to other
tenants on a targeted basis, and in varied channels
such as online marketing on Frasers’ online
retail platforms – the digital food and beverage
concierge app Makan Master and the Frasers
e-Store which will be launched soon.
FCT’s financial position remains healthy
FCT’s financial position remains healthy with
a gearing level of 35.9%2 as at 30 September
2020. Total borrowings stood at S$1,255 million
and average cost of borrowings at 2.4%. The
pro forma gearing of the enlarged FCT portfolio
post the ARF Acquisition is approximately 39.3%
and the aggregate borrowing is approximately
S$2.4 billion with slightly lower average cost of
borrowing of about 2.3%.
Despite the COVID-19 situation, FCT maintains
healthy liquidity through successful debt financing
including raising S$200 million in bonds in May
2020 and various tranches of revolving credit
facilities. FCT also remains compliant with
its financial covenants.
Valuation of portfolio properties remains stable
The valuation of FCT’s portfolio remains stable. The
portfolio appraised value as at 30 September 2020
stood at S$2,857 million, compared with
S$2,846 million a year ago. Apart from the
properties Changi City Point, Anchorpoint and
Yishun 10 which recorded declines in appraised
values, the valuation of the remaining larger
properties held steady. Bedok Point, which
was earmarked for divestment subsequent to
30 September 2020, registered a S$14 million gain
in appraised value, based on the divestment price
of the property3.
Resilient operating performance
The operating performance of FCT’s portfolio
remains resilient despite the mandatory COVID-19
safe distancing and control measures. Portfolio
occupancy4 as at 30 September 2020 held steady
at 94.9%, a slight decline from 96.5% a year ago.
Since the start of Phase 2 of re-opening on 19 June
2020, all retailers have resumed business, with
the exception of a few businesses such as family
karaokes and travel agencies. Portfolio tenants’
sales have recovered to near pre-COVID-19 level
since Phase 2 re-opening, but the recovery rate is
uneven among various trade sectors and tenants.
Portfolio shopper traffic has remained relatively
stable at 60% to 70% of pre-COVID-19 level.
Easing of safe distancing measures in Phase 3
re-opening will likely support further recovery of
shopper traffic and tenant sales.
Well-spread lease expiry
FCT has a well-spread portfolio lease expiry profile
with low concentration risk. FCT has about 32%
of its leases (by rental income) expiring in FY2021,
of which one-fifth of the renewals have been
renewed or committed. This leaves about 26% of
the expiring leases to be renewed in FY2021.
In the near-term, FCT expects pressure on asking
rents for new and renewal leases, taking into
account market uncertainties, the uneven pace
of recovery among the retail trade sectors,
continuation of certain COVID-19 control measures
and weak economic outlook, amongst others. This
may in turn impact occupancy.
As such, we are adopting differentiated
approaches in our lease negotiations. This could
include concessionary rent rate for a specific
period before returning back to market rate in the
subsequent period. We are also offering short-
term lease extensions to allow tenants more time
to assess their situation before committing to a
new lease. These approaches will in turn, allow FCT
as a landlord to gain clarity on Singapore’s phased
re-opening and to price its rents accordingly.
Sustainability as an integral part of FCT’s strategy
The Board views sustainability as an integral part
of FCT’s business strategy. As part of the Frasers
Property Group (the “Group”), the management
team works closely with the Group’s sustainability
leadership and working teams to attain net zero
carbon, achieve Green Mark certification for our
properties, and improve the health and well-being
1
2
3
4
FCT owns 40.0% of SST which holds Waterway Point.
In accordance with Property Funds Appendix, the gearing ratio included FCT’s proportionate share of deposited property value and borrowings in SST.
Based on the sale price of Bedok Point in the proposed divestment of Bedok Point as announced on 3 September 2020. The sale price was arrived at
after taking into account the independent valuations conducted by Jones Lang LaSalle Property Consultants Pte. Ltd.(“JLL”) (commissioned by HSBC
Institutional Trust Services (Singapore) Limited (in its capacity as trustee of FCT)) and Colliers International Consultancy & Valuation (Singapore) Pte. Ltd.
(“Colliers”) (commissioned by the Company). JLL, in its report dated 1 August 2020, had stated that the open market value of Bedok Point as at 1 August
2020 was S$108.9 million and Colliers, in its report dated 1 August 2020, had stated that the open market value of Bedok Point as at 1 August 2020 was
S$107.2 million. The divestment of Bedok Point was completed on 9 November 2020.
Includes Waterway Point
of our people and stakeholders. Details are
outlined in the Sustainability Report which is an
integral part of this Annual Report.
retail offerings that will strengthen the resilience
of our malls and its relevance to our tenants
and consumers.
A N N U A L R E P O R T 2 0 2 0 / 1 5
FCT now one of Singapore’s largest suburban
mall owners and top-10 S-REITs by market
capitalisation
FCT is now one of the largest suburban retail mall
owners in Singapore. FCT is also among the top
10 largest S-REITs by total and free float market
capitalisation.
We believe in the defensiveness of the suburban
retail sector which will remain resilient and
relevant to our shoppers, in particular dominant
malls well-located in dense residential catchment
areas, near transportation nodes and focused
on essential goods and services. Our enlarged
portfolio comprises substantially malls with such
characteristics.
With the enlarged portfolio of 11 suburban malls
after the ARF Acquisition, FCT has more than
2.3 million square feet of net lettable space,
more than 1,500 retail leases, 800,000 Frasers
Experience (“FRx”) members and a catchment
population of 3 million. This strengthens FCT’s
ability to offer more options and value to retailers
and shoppers. It also provides FCT with the scale to
drive omnichannel retail strategies and to enhance
the role of its malls as “last-mile” fulfilment hubs
in their immediate residential catchment, as
working-from-home becomes more prevalent.
Omnichannel, the future of retail
Frasers Property Retail as a group (the “FPR
Group”), has recently introduced a feature to
provide aggregated delivery from multiple store
orders on the enhanced version of its food
ordering app called the Frasers Makan Master. This
feature enables consumers to combine orders from
several F&B stores within the same mall in one
delivery, thus saving delivery time and fees for
the consumers.
The FPR Group will also launch the Fraser e-Store,
an omnichannel store-to-door service for our
tenants. This platform helps our tenants to get
on the omnichannel retail bandwagon, providing
insights on consumer preferences and behaviour
for tenants to better meet consumer needs
through adapting their products and service
offerings. This is particularly useful for small and
medium enterprise (“SME”) retailers who find it
costly and difficult to invest in such infrastructure
without economies of scale.
The new omnichannel platforms in the enhanced
Makan Master and the Frasers e-Store, together
with the scale of our portfolio of physical malls
and the 800,000-strong FRx membership base
form a strong combination of physical and digital
Staying agile in the new normal
The post-COVID-19 “new normal” requires us
to stay agile and flexible amid fast changing
consumer trends. We also need closer
collaboration with our tenants, to plan ahead
and address challenges proactively in order to
infuse resilience in our partnerships. A strong and
sustainable relationship with our tenants and their
businesses is a key success factor of our business.
We believe we have the agility and tenacity to
think ahead as an individual, as a team and
as a business, to thrive and succeed in delivering
long-term returns and value for the Trust and
our unitholders.
Keeping an eye on future growth
While the immediate focus of the management
team is to improve the operations and financial
performance of the enlarged portfolio, we will
continue to explore and evaluate acquisition
opportunities that are yield-accretive, strengthen
FCT’s business fundamentals and enhance its
growth prospects. Potential opportunities include
Northpoint City South Wing, which is owned by
Frasers Property and the TCC Group, as well as
opportunities from third party owners looking to
divest their retail assets. At the same time, FCT
will also continue to evaluate opportunities to
re-constitute its portfolio, including the
divestment of certain properties, to optimise its
return objectives for the Trust and our unitholders.
Acknowledgements
In closing, we thank our board members for their
stewardship and advice, the management and staff
for their commitment and hard work despite the
challenges amid the COVID-19, our Unitholders for
their continued support for the EFR and confidence
in FCT, and all our business partners, tenants and
shoppers for their continued support.
CHEONG CHOONG KONG
Chairman
RICHARD NG
Chief Executive Officer
Contents
1 6 / F R A S E R S C E N T R E P O I N T T R U S T
BOARD OF
DIRECTORS
DR CHEONG CHOONG KONG, 79
Chairman, Non-Executive
and Independent Director
Date of appointment as Director
18 May 2016
Length of service as Director
(as at 30 September 2020)
4 years and 4 months
Board committees served on
• Audit, Risk and Compliance Committee
(Member)
• Nominating and Remuneration
Committee (Member)
Academic & Professional Qualifications
• Bachelor of Science, Adelaide University
• Master of Science, Australian National
University
• Doctor of Philosophy, Australian
National University
• Doctor of Science (Honorary), Australian
National University
• Degree of Doctor of the University
(Honorary), Adelaide University
Present Directorships in other companies
as at 30 September 2020
Listed companies
• Nil
Listed REITs/Trusts
• Nil
Others
• Director, Board of National Council of
Social Services
Major appointments
(other than Directorships)
• Chairman, NUS Mind Science Centre
Advisory Board
Past Directorships in listed companies
held over the preceding 3 years (from
1 October 2017 to 30 September 2020)
• Nil
Past major appointments
• Chairman, Oversea-Chinese Banking
Corporation Limited
• Chairman, Singapore Broadcasting
Corporation
• Chairman, NUS Council
• Deputy Chairman and CEO, Singapore
Airlines Limited
MR HO CHAI SENG, 60
Non-Executive and
Independent Director
Date of appointment as Director
30 June 2017
Length of service as Director
(as at 30 September 2020)
3 years 3 months
Board committees served on
• Nominating and Remuneration
Committee (Chairman)
• Audit, Risk and Compliance Committee
(Member)
Academic & Professional Qualifications
• Bachelor of Commerce, University of
Windsor, Canada
• Member, Singapore Institute of Directors
• Member, International Bankers
Association of Japan
Present Directorships in other companies
(as at 30 September 2020)
Listed companies
• Nil
Listed REITs/Trusts
• Nil
Others
• Nil
Major appointments
(other than Directorships)
• Executive Director and Country
Manager, United Overseas Bank Ltd,
Tokyo Branch
Past Directorships in listed companies
held over the preceding 3 years (from
1 October 2017 to 30 September 2020)
• Frasers Property (UK) Limited
Past major appointments
• Vice President, BHF- Bank, New York
• Assistant General Manager, BHF-Bank,
Singapore
• General Manager, DBS Bank, London
• General Manager, United Overseas Bank
Ltd. London
• Executive Director, United Overseas
Bank Ltd. Singapore
A N N U A L R E P O R T 2 0 2 0 / 1 7
Contents
1 8 / F R A S E R S C E N T R E P O I N T T R U S T
BOARD OF
DIRECTORS
Date of appointment as Director
9 February 2017
Length of service as Director
(as at 30 September 2020)
3 years 7 months
Others
• Allgreen Properties Limited
• ALPS Pte. Ltd. (formerly known as
Agency for Healthcare Supply Chain Pte.
Ltd.)
• Frasers Hospitality International Pte.
Ltd.
Board committees served on
• Audit, Risk and Compliance Committee
• MOH Holdings Pte. Ltd. (as
representative of ALPS Pte. Ltd.)
(Member)
• Nominating and Remuneration
Committee (Member)
Academic & Professional Qualifications
• Bachelor of Science (Estate
Management) (Honours), National
University of Singapore
• Master of Real Estate, National
University of Singapore
• Frasers Property (Singapore) Pte. Ltd.
Major appointments
(other than Directorships)
• Nil
Past Directorships in listed companies
held over the preceding 3 years (from
1 October 2017 to 30 September 2020)
• Nil
Present Directorships in other companies
(as at 30 September 2020)
Past major appointments
• Deputy CEO of CapitaLand Mall Asia
Listed companies
• Nil
Listed REITs/Trusts
• Nil
Limited (formerly known as CapitaMalls
Asia Limited)
• CEO of the Manager of CapitaLand Mall
Trust (formerly known as CapitaMall
Trust)
Others
• Previously on the Board of directors
of the managers of CapitaLand Mall
Trust (which is listed on the Singapore
Exchange Securities Trading Limited)
and CapitaLand Malaysia Mall Trust
(which is listed on Bursa Malaysia)
Date of appointment as Director
1 October 2019
Listed REITs/Trusts
• Nil
Length of service as Director
(as at 30 September 2020)
1 year
Board committees served on
• Audit, Risk and Compliance Committee
(Chairman)
• Nominating and Remuneration
Committee (Member)
Academic & Professional Qualifications
• Bachelor of Science (Estate
Management) (Honours), National
University of Singapore
• Master of Art (Business Administration),
University of Georgia (Athens) / United
States of America
• Registered Salesperson, Council for
Estate Agencies
Others
• Edmund Tie & Company (SEA) Pte. Ltd.
• Edmund Tie & Company (Thailand) Co.,
Ltd.
• Edmund Tie & Company Hospitality
Management Services Pte. Ltd.
• Edmund Tie & Company Property
Management Services Pte. Ltd.
• Edmund Tie & Company Sdn. Bhd.
• Edmund Tie Holdings Pte. Ltd.
• ET Investment Holdings Pte. Ltd.
• ET Investment Management (Singapore)
Pte. Ltd.
• New Horizon Holdings Pte. Ltd.
• OrangeTee & Tie (JV) Pte. Ltd.
Major appointments
(other than Directorships)
• Chief Executive Officer, Edmund Tie &
• Fellow, Royal Institute of Chartered
Company (SEA) Pte. Limited
Surveyors
• Fellow, Singapore Institute of Surveyors
& Valuers
• Licensed Valuer, Inland Revenue
Authority of Singapore
Past Directorships in listed companies
held over the preceding 3 years (from
1 October 2017 to 30 September 2020)
• Nil
Present Directorships in other companies
(as at 30 September 2020)
Past major appointments
• Chief Operating Officer, DTZ Debenham
Listed companies
• Nil
Tie Leung (SEA) Pte. Ltd. (formerly
known as Edmund N.S. Tie & Company
Pte. Ltd.
MR HO CHEE HWEE, SIMON, 59
Non-Executive and
Non-Independent Director
MS KOH CHOON FAH, 62
Non-Executive and
Independent Director
Date of appointment as Director
3 January 2020
Length of service as Director
(as at 30 September 2020)
9 months
Board committees served on
• Nil
Academic & Professional Qualifications
• Bachelor of Economics, Monash
University
• Bachelor of Laws, Monash University
• Fellow of CPA Australia
• Fellow of Chartered Accountant of
Singapore
Present Directorships in other companies
(as at 30 September 2020)
MR LOW CHEE WAH, 55
Non-Executive and
Non-Independent Director
Listed companies
• Nil
Listed REITs/Trusts
• Nil
Date of appointment as Director
27 January 2006
Length of service as Director
(as at 30 September 2020)
14 years 8 months
Board committees served on
• Nominating and Remuneration
Committee (Member)
Academic & Professional Qualifications
• Bachelor of Science, National University
of Singapore
• Master of Business Administration,
National University of Singapore
Present Directorships in other companies
(as at 30 September 2020)
Listed companies
• Nil
Listed REITs/Trusts
• Nil
Others
• Ren Ci Hospital
MR CHRISTOPHER TANG KOK KAI, 59
Non-Executive and
Non-Independent Director
A N N U A L R E P O R T 2 0 2 0 / 1 9
Others
• Dover Park Hospice (Chairman, Audit,
Risk and Governance Committee)
• Real Estate Investment Trust
Association of Singapore (Vice
President)
• Singapore River One Limited (Board
Member)
Major appointments
(other than Directorships)
• Chief Executive Officer, Frasers Property
Retail, Frasers Property (Singapore) Pte.
Ltd.
Past Directorships in listed companies
held over the preceding 3 years (from
1 October 2017 to 30 September 2020)
• Frasers Commercial Asset Management
Ltd., Manager of Frasers Commercial
Trust1
Past major appointments
• Senior Executive Vice President, Head of
Retail and Commercial Division, Frasers
Property Limited
• Chief Executive Officer of Frasers
Commercial Asset Management Ltd,
manager of Frasers Commercial Trust
• Chief Executive Officer of BNP Paribas
Peregrine (Singapore) Ltd., investment
banking arm of BNP Paribas Singapore
Major appointments
(other than Directorships)
• Senior Adviser, Frasers Property
(Singapore) Pte. Ltd.
Past Directorships in listed companies
held over the preceding 3 years (from
1 October 2017 to 30 September 2020)
• Frasers Commercial Asset Management
Ltd., Manager of Frasers Commercial
Trust1
Past major appointments
• Chief Executive Officer, Singapore,
Frasers Property Limited
• Chief Executive Officer, Frasers
Centrepoint Commercial, Frasers
Centrepoint Limited
• Chief Executive Officer, China, Frasers
Centrepoint Limited
• Chief Executive Officer of Frasers
Centrepoint Asset Management Ltd,
Manager of Frasers Centrepoint Trust
1
Frasers Commercial Trust has been merged with Frasers Logistics & Industrial Trust with effect from
15 April 2020, to form Frasers Logistics & Commercial Trust.
Contents
2 0 / F R A S E R S C E N T R E P O I N T T R U S T
TRUST
MANAGEMENT TEAM
Richard is responsible for the overall business direction, investment strategies and the
operations of FCT. He leads the FCAM management team to ensure that FCT’s finance,
investment, asset management, investor relations and other plans and initiatives are
executed successfully.
Richard has 28 years of experience in the Singapore and regional property markets,
spanning the areas of marketing, investment, asset and REIT management. Prior to joining
Frasers Property, he was Executive Director, Asset Management, at PGIM (Singapore)
Pte. Ltd., where he oversaw the asset management of portfolio comprising retail and
commercial properties in Singapore and Malaysia. Richard has held senior management
appointments during his 14 years at the CapitaLand Group, including 10 years at
Capitaland Mall Trust (“CMT”) where he was part of the team that oversaw the initial
public offering of CMT in 2002. At CMT, Richard was the Head of Asset Management,
responsible for overall performance of CMT’s assets.
Richard holds a Bachelor of Science (Honours) degree in Estate Management and a Master
of Science degree in Real Estate, both from the National University of Singapore.
Hwee Pio is responsible for the financial, taxation, treasury and compliance functions
of FCT. She has 25 years of financial experience in the real estate industry. Prior to
joining FCT, Hwee Pio was based in Shanghai for 10 years, where she was the financial
controller for Frasers Property Limited’s business operations in China since 2006. Before
joining Frasers Property Limited, Hwee Pio held financial positions at Keppel Land and
Guocoland. She started her career as an external auditor with KPMG.
Hwee Pio is a Singapore Chartered Accountant (CA) with the Institute of Singapore
Chartered Accountants and she is a Fellow with the Association of Chartered Certified
Accountants.
MR RICHARD NG
Chief Executive Officer
MS TAY HWEE PIO
Chief Financial Officer
A N N U A L R E P O R T 2 0 2 0 / 2 1
Pauline Lim is responsible for the management of FCT’s portfolio of retail assets in
Singapore. She has over 20 years of real estate experience. Prior to joining FCAM, she
was the Executive Director at PGIM Real Estate (“PGIM”) and was responsible for the
portfolio management of PGIM Real Estate AsiaRetail Fund and another private equity
co-investment which together own several malls in Singapore and Malaysia. Before
PGIM, Pauline was Vice-President, Investment Management of GIC Real Estate (“GIC
RE”), where she was responsible for investment and asset management in the office,
retail and residential sectors in various Asia Pacific markets, and supported GIC RE senior
management in global portfolio reporting, asset strategy and planning. Prior to GIC RE,
she held various roles at DBS and Jones Lang LaSalle in Singapore and Hong Kong.
Pauline holds an MBA degree from the University of Western Australia and a Bachelor’s
degree in Business Administration from the National University of Singapore.
Fung Leng is responsible for FCT’s investor relations function. He has more than 10 years
of experience in the field of investor relations and he is responsible for forging relations
and the communications between FCT and its unitholders, the investment community
and the media. He also provides market intelligence and research to the management
team. Fung Leng holds a Master of Science degree in Industrial and Systems Engineering
and a Bachelor’s degree in Mechanical Engineering (Honours), both degrees from the
National University of Singapore.
Contents
MS PAULINE LIM
Head, Investment & Asset Management
MR CHEN FUNG LENG
Vice President, Investor Relations
2 2 / F R A S E R S C E N T R E P O I N T T R U S T
INVESTOR
RELATIONS
OPEN AND TRANSPARENT COMMUNICATIONS
WITH UNITHOLDERS
Frasers Centrepoint Asset Management Ltd
(“FCAM”), as Manager of Frasers Centrepoint Trust
(“FCT”), is committed to maintaining open and
transparent communications with its unitholders
(“Unitholders”), media and the investors. FCAM
provides factual and timely disclosure on all
material information concerning FCT. General
information on FCT including annual reports,
portfolio information and investor presentations
are updated regularly on FCT’s website. All news
releases and company announcements are also
available on the SGX-ST website.
ANNUAL GENERAL MEETING (“AGM”) AND
EXTRAORDINARY GENERAL MEETING (“EGM”)
The AGM and EGM are important communication
platforms between the board of directors, the
management of FCAM and the Unitholders. FCT
convened its 11th AGM on 13 January 2020. All
resolutions tabled at the AGM were duly passed.
On 28 September 2020, FCT convened an EGM
to seek Unitholders’ approval for five ordinary
resolutions relating to the proposed acquisition
(the “ARF Acquisition”) of approximately 63.11%
of the total issued share capital of AsiaRetail Fund
Limited (“ARF”); the proposed issue of new units
in FCT under an equity fund raising (“EFR”); the
proposed issue and placement of new units to
Frasers Property Limited and its subsidiaries under
a private placement; the proposed whitewash
resolution; and the proposed divestment of
Bedok Point.
Due to the COVID-19 restriction orders in
Singapore, the EGM on 28 September 2020 was
conducted via electronic means pursuant to the
COVID-19 (Temporary Measures) (Alternative
Arrangements for Meetings for Companies,
Variable Capital Companies, Business Trusts,
Unit Trusts and Debenture Holders) Order 2020.
Unitholders who wished to attend the EGM
were requested to pre-register electronically for
the EGM to enable the Manager to verify their
status as Unitholders. Following the verification,
authenticated Unitholders will each receive an
email, which will contain a user ID and password
details as well as instructions on how to access
the live audio-visual webcast and live audio-only
stream of the EGM proceedings.
In place of the usual “live” question and
answer session during an EGM in normal times,
Unitholders were invited to submit questions
related to the resolutions to be tabled for approval
at the EGM to the Chairman of the EGM prior to
the EGM. The responses to the substantial and
relevant questions received from Unitholders were
published on FCT’s website and on SGXNET, prior
to the EGM, on 26 September 2020. Some of the
questions were also addressed during the EGM. All
five resolutions were duly passed and the results
were announced on the SGXNET and FCT’s website
on the same day of the EGM.
The minutes of the EGM and the responses to the
substantial and relevant questions received from
Unitholders were also published on FCT’s website
subsequently.
PROACTIVE OUTREACH TO INVESTORS THROUGH
MANY CHANNELS
FCAM proactively engages investors and the
research analysts through various channels to
extend its outreach and to raise the profile of FCT
among investors.
Due to the COVID-19 restriction orders in
Singapore, all investor events which FCT
participated in from March 2020 were organised
on electronic platforms such as Zoom or Microsoft
Teams. These include the investor roadshows and
the dialogue session with Unitholders organised
by Securities Investors Association (Singapore)
(“SIAS”) and FCT in September 2020. The adoption
of virtual meetings has no significant compromise
on the efficacy of investor engagements.
During FY2020, we participated in the following
investor relations activities:
A N N U A L R E P O R T 2 0 2 0 / 2 3
Time Frame
Key Investor Relations Events
Date
1QFY20
1 October
– 31 December 2019
Release of 4QFY19 and full year FY2019 results and post-results
analysts’ briefing
Post-results investors’ luncheon
2QFY20
1 January
– 31 March 2020
DBS Pulse of Asia Conference
11th Annual General Meeting
23 October 2019
24 October 2019
7 January 2020
13 January 2020
3QFY20
1 April
– 30 June 2020
4QFY20
1 July
– 30 September 2020
Release of 1QFY20 results and post- results analysts’ conference call
23 January 2020
Post-results investors’ luncheon
UBS Corporate Day (Virtual)
Credit Suisse ASEAN Corporate Day (Virtual)
Release of 2QFY20 results, post-results analysts’ briefing and
investor call (Virtual)
Post-results call with investors (Virtual)
Citi Pan-Asia Regional Investor Conference 2020 (Virtual)
SGX-Credit Suisse Singapore Corporate Day (Virtual)
23 January 2020
13 March 2020
18 March 2020
23 April 2020
24 April 2020
20 May 2020
18 June 2020
3QFY20 Business Updates1
Announcement of the proposed acquisition of approximately 63.11%
of the total issued share capital of ARF and the proposed divestment
of Bedok Point
23 July 2020
3 September 2020
Dialogue with Unitholders, organised by SIAS and FCT (Virtual)
16 September 2020
Investor Roadshow hosted by DBS/Citi/OCBC (Virtual)
7-18 September 2020
Responses To The Substantial And Relevant Questions From
Unitholders For The EGM On 28 September 2020
EGM (Virtual)
Launch of the EFR2
26 September 2020
28 September 2020
28 September 2020
1
2
FCT announced on 13 May 2020 the change to half-yearly reporting of financial results and to half-yearly distributions. With this change, FCT’s
financial statements are announced on a half-yearly basis and business updates are provided for the first and third quarter performance of FCT.
Distributions will be made at half-yearly intervals starting from 2H FY2020 (second half of FY2020 ended 30 September 2020).
The EFR was to part-finance the total acquisition cost of the ARF Acquisition. The EFR comprised a private placement (the “Private Placement”) of
new units in FCT (the “New Units”) to institutional and other investors and a non-renounceable preferential offering (the “Preferential Offering”) of
New Units to the existing Unitholders on a pro rata basis. The books of orders for the Private Placement was closed on 29 September 2020 and gross
proceeds of approximately S$575.0 million was raised. The Preferential Offering, which was launched on 9 October 2020 and closed on 19 October
2020, raised gross proceeds of approximately S$759.7 million. The aggregate gross proceeds raised from the EFR was approximately S$1,334.7 million.
Contents
2 4 / F R A S E R S C E N T R E P O I N T T R U S T
INVESTOR
RELATIONS
COVERAGE BY EQUITY RESEARCH HOUSES
As at 30 September 2020, there were 20 equity
research firms which provided equity research
coverage on FCT. The research firms which cover
FCT (in alphabetical order) are:
Bank of America-Merrill Lynch
CGS-CIMB Research
Citi Investment Research
CLSA
Credit Suisse
Daiwa Capital Markets
DBS Vickers Securities
HSBC
J.P. Morgan
1.
2.
3.
4.
5.
6.
7.
8.
9.
10. KGI Securities (Singapore)
11. Macquarie
12. Maybank Kim Eng Research
13. Mizuho Securities Asia Limited
14. MorningStar
15. OCBC Investment Research
16. Phillip Securities Research (Singapore)
17. RHB
18. Soochow CSSD Capital Markets (SCCM)
19. UBS
20. UOB Kay Hian Research
FY2021 FINANCIAL CALENDAR
(Dates are indicative and are subject to change)
21 January 2021
Annual General Meeting
21 January 2021
1Q FY2021 Business Updates
April 2021
1H FY2021 Results Announcement
End May 2021
1H FY2021 Distribution Payment
July 2021
3Q FY2021 Business Updates
October 2021
2HFY2021 and Full Year FY2021
Results Announcement
End November 2021 2H FY2021 Distribution Payment
ENQUIRIES
For general enquiries on FCT, please contact:
Mr Chen Fung Leng
Vice President, Investor Relations
Frasers Centrepoint Asset Management Ltd
Tel: (65) 6277-2657
Email: ir@fraserscentrepointtrust.com
UNIT REGISTRAR
Boardroom Corporate & Advisory Services Pte Ltd
Phone: (65) 6536-5355
Fax: (65) 6536-1360
Website: www.boardroomlimited.com
Northpoint City
Contents
2 6 / F R A S E R S C E N T R E P O I N T T R U S T
OPERATIONS & FINANCIAL REVIEW
OPERATIONS REVIEW
OPERATIONS
REVIEW
LEASE RENEWALS
A total of 235 leases were renewed in FY2020 (FY2019: 313). These leases accounted for 352,989 square feet or 24.3%
of FCT’s portfolio net lettable area1 (“NLA”). The average rental reversion of these renewals was positive 4.2% (FY2019:
4.8%). Rental reversion refers to the variance between the average rental rate of the renewed leases and the preceding
expired leases which were contracted typically three years ago. All malls recorded positive rental reversions of between
3.6% and 5.6% for the year under review. The data for Waterway Point, of which FCT owns a 40% interest, is included in
the portfolio calculation.
Summary of Leases Renewed in FY2020
(Excluding newly-created and reconfigured area)
Property
Number of leases
renewed
Aggregate area of
renewed leases
(square feet)
Renewed area
as percentage of
property’s NLA
Increase / (Decrease) in average rental
rates of renewed leases compared with
rental rates of preceding leases
Causeway Point
Northpoint City North Wing2
Waterway Point
Changi City Point
Bedok Point
YewTee Point
Anchorpoint
59
57
51
28
12
15
13
112,316
59,264
77,432
49,342
12,066
18,591
23,978
FCT Portfolio Average
235
352,989
26.8%
25.8%
20.8%
24.1%
14.6%
25.2%
33.7%
24.3%
3.8%
3.6%
4.7%
4.8%
3.8%
5.6%
4.1%
4.2%
LEASE EXPIRY PROFILE
The portfolio lease expiry from FY2021 to FY2026 and beyond, and the lease expiry by property in FY2021 are
presented in tables on the next page. Our leases have an average lease duration of 3 years. Certain key or anchor
tenants may be offered longer tenures, depending on the lease structure.
FCT has a well-spread portfolio lease expiry profile with low concentration risk. The leases due in the next two years
in FY2021 and FY2022 account for 32.6% and 33.6% of FCT’s Gross Rental Income (“GRI”), respectively. As at 30
September 2020, the weighted average lease expiry (“WALE”3) of FCT portfolio stood at 1.55 years by NLA and 1.51
years by GRI.
The WALE (by GRI) of the new leases entered during FY2020, based on duration to lease expiry as at 30 September
2020 was 2.27 years. The weighted average lease tenure (By NLA) of these new leases is 2.16 years. These new leases
account for 31.5% of the total GRI of FCT portfolio as at 30 September 2020.
The aggregate NLA of the leases in FCT portfolio, including that of Waterway Point, due for renewal in FY2021 is
433,861 square feet, of which about 65% is attributed to the three largest malls - Causeway Point, Waterway Point,
Northpoint City North Wing (including Yishun 10 retail podium). Excluding Bedok Point, which has been divested on 9
November 2020 following the approval by unitholders at an extraordinary general meeting on 28 September 2020, the
aggregate NLA due for renewal in FY2021 is 408,777 square feet, representing approximately 31.4% of the total leased
area of the portfolio and 32.4% of the total portfolio GRI.
Including Waterway Point, which FCT holds 40%-interest
Includes Yishun 10 Retail Podium
Computation of WALE is as follows:
1
2
3
WALENLA = Sum of (Remaining Lease Tenure x NLA of Individual leases) / Total Leased Area
WALEGRI = Sum of (Remaining Lease Tenure x GRI of Individual leases) / Total GRI
Remaining lease Tenure = time period between reporting date and the lease expiry date
A N N U A L R E P O R T 2 0 2 0 / 2 7
In the near-term, we expect tenants to take longer time in lease negotiations, taking into account market uncertainties,
the uneven pace of recovery among the retail trade sectors, continuation of certain COVID-19 control measures and
weak economic outlook, amongst others. The uncertainties in the market conditions would likely exert pressure on
asking rents for new and renewal leases.
As such, we are adopting differentiated approaches in our lease negotiations. This could include concessionary rent
rate for a specific period before returning back to market rate in the subsequent period. We are also offering short-
term lease extensions to allow tenants more time to assess their situation before committing to a new lease. These
approaches will in turn, allow FCT as a landlord to gain clarity on Singapore’s phased re-opening and to price its
rents accordingly.
Portfolio Lease Expiry4 as at 30 September 2020
FY2021
FY2022
FY2023
FY2024
FY2025
FY2026 and
beyond
Total
Number of leases expiring
341
286
215
22
2
1
867
Leased area expiring (square feet)
433,861 505,344 333,453
82,832
2,699
21,248
1,379,437
Expiries as % of total leased area
31.5%
36.6%
24.2%
Expiries as % of total GRI
32.6%
33.6%
27.0%
6.0%
6.4%
0.2%
0.2%
1.5%
0.2%
100.0%
100.0%
Lease Expiry4 for FY2021 as at 30 September 2020
Property
Causeway Point
Northpoint City North Wing5
Waterway Point
Changi City Point
Bedok Point
YewTee Point
Anchorpoint
Total FCT
Number of leases
expiring
Leased area expiring
(square feet)
Expiries as % of
property’s total
leased area
GRI of expiring
leases as % of the
property’s total GRI
78
72
53
62
16
36
24
98,007
73,394
110,275
84,341
25,084
22,238
20,522
24.2%
33.6%
30.9%
45.5%
33.0%
31.1%
31.1%
30.0%
34.5%
29.5%
43.8%
43.4%
36.3%
31.1%
341
433,861
31.5%6
32.6%7
Total FCT (excluding Bedok Point8)
325
408,777
31.4%6
32.4%7
PORTFOLIO TENANTS’ SALES AND OCCUPANCY COST
FCT’s total portfolio tenants’ sales in FY2020 was severely
impacted by the COVID-19 and the Circuit Breaker in
2HFY2020. Total portfolio tenants’ sales in 2HFY2020 fell
24.3% y-o-y mainly due to the impact from the Circuit
Breaker, during which many businesses, except those in
the essential trades, were ordered to shut; F&B outlets
were only allowed to do takeaways and delivery orders;
and strict safe distancing and crowd control measures
were enforced. Within FCT’s portfolio, only about 30%
of tenants stayed open during this period. Tenants’ sales
started to recover after the commencement of Phase 2
re-opening, when all businesses, with the exception of a
few, such as family karaokes, were permitted to resume
business. The total portfolio tenants’ sales recovered to
near pre-COVID-19 level in July 2020 and had remained
stable around 95% of last year’s level. For the full year
FY2020, total portfolio tenants’ sales was approximately
13.1% lower than the previous corresponding year.
The decline in sales and the disruptions to the tenants’
businesses during the Circuit Breaker period resulted
in an increase in the average portfolio occupancy cost.
The average occupancy cost for FCT portfolio for the
12-month period between October 2019 and September
2020 stood at 19.2%, compared with 17.0% in FY2019.
Excluding vacancy
Includes Yishun 10 Retail Podium
4
5
6 As percentage of leased area of FCT portfolio, excluding vacancy, as at 30 September 2020
7 As percentage of GRI of FCT portfolio for the month of September 2020, excluding gross turnover rent
8
The Manager announced on 3 September 2020 the divestment of Bedok Point for S$108 million. This transaction was approved by FCT unitholders at an
extraordinary general meeting on 28 September 2020 and the divestment was completed on 9 November 2020
Contents
2 8 / F R A S E R S C E N T R E P O I N T T R U S T
OPERATIONS & FINANCIAL REVIEW
OPERATIONS REVIEW
Occupancy cost refers to the ratio of gross rental
(including turnover rent) paid by the tenants to the
tenant’s sales turnover (excluding Goods & Services Tax).
The occupancy cost for FY2020 and the preceding
four financial years are presented in the table below.
Turnover Rent clauses, which the tenants would pay
between 0.5% and 1% of their sales as part of the gross
rent under the lease agreements.
PORTFOLIO OCCUPANCY
FCT Portfolio Occupancy Cost
15.7%
16.6%
16.6%
17.0%
19.2%
FY2016
FY2017
FY2018
FY2019
FY2020
LEASES WITH GROSS TURNOVER RENT AND STEP-UP
CLAUSES
Approximately 89.9% (FY2019: 97.8%) of our leases
include step-up clauses that provide for annual rental
increment of between 1% and 2% during the lease
term. The 7.9%-point decline y-o-y was attributed to an
increase in the number of lease extensions and short-
term lease renewals in FY2020 due to the COVID-19
situation, and they do not have step-up rents. Of the
occupied leases, 92.2% (FY2019: 93.5%) include Gross
Portfolio Occupancy
The portfolio occupancy stood at 94.9% as at 30
September 2020, which is 1.6%-point lower compared
with 96.5% a year ago. All properties, except Anchorpoint
and YewTee Point, saw occupancy fall between
0.4%-point and 5.5%-point. Occupancy at Anchorpoint
as at 30 September 2020 is 13.7%-point higher as the
occupancy in the prior year was affected by transitionary
fitting out works by an anchor tenant of the mall.
The portfolio occupancy by property is shown in the
table below.
SHOPPER TRAFFIC
The total shopper traffic of the portfolio in FY2020 fell
22.9% to 112.9 million (FY2019: 146.5 million), attributed
to the sharp fall in traffic in the 2HFY2020 during the
Circuit Breaker and the traffic density control and safe
distancing measures which are still in place. Shopper
traffic has recovered to around 60% to 70% of pre-
COVID-19 level since the Phase 2 re-opening and has
remained relatively stable since. Easing of safe distancing
measures in Phase 3 re-opening will likely support further
recovery of shopper traffic.
Occupancy by Property
As at 30 September 2020
As at 30 September 2019
Increase/ (Decrease)
Causeway Point
Northpoint City North Wing9
Waterway Point
Changi City Point
Bedok Point
YewTee Point
Anchorpoint
FCT Portfolio
Shopper Traffic
96.6%
95.0%
96.0%
90.4%
92.0%
97.1%
92.7%
94.9%
97.0%
99.0%
98.0%
95.9%
95.7%
97.1%
79.0%
96.5%
(0.4%-point)
(4.0%-point)
(2.0%-point)
(5.5%-point)
(3.7%-point)
No change
13.7%-point
(1.6%-point)
Shopper Traffic by Property (million)
FY2020
(1 Oct 2019 – 30 Sep 2020)
FY2019
(1 Oct 2018 – 30 Sep 2019)
Increase/ (Decrease)
Causeway Point
Northpoint City North Wing10
Waterway Point
Changi City Point
Bedok Point
YewTee Point
Anchorpoint
FCT Total
21.0
46.9
19.6
9.1
3.3
10.6
2.4
26.5
57.3
28.4
13.9
4.2
13.0
3.2
112.9
146.5
(20.8%)
(18.2%)
(31.0%)
(34.5%)
(21.4%)
(18.5%)
(25.0%)
(22.9%)
A N N U A L R E P O R T 2 0 2 0 / 2 9
TRADE SECTOR ANALYSIS
Food & Beverage (“F&B”) remains the largest sector accounting for 30.6% of FCT’s total NLA (FY2019: 31.5%) and 38.2%
of the GRI (FY2019: 37.8%). The second and the third largest trade categories by GRI are Fashion at 13.0% (FY2019:
14.4%) and Beauty & Health at 12.0% (FY2019: 11.3%).
Trade Classifications (by order of decreasing GRI)
As % of Total NLA
As % of Total GRI11
Food & Beverage
Fashion
Beauty & Health
Services
Household
Supermarket and Hypermarket
Leisure/Entertainment
Books, Music, Arts & Craft, Hobbies
Department Store
Jewellery & Watches
Sports Apparel & Equipment
Education
Vacant
Grand Total
TOP 10 TENANTS BY GRI
30.6%
12.7%
8.3%
4.5%
9.9%
7.3%
6.4%
3.7%
4.1%
0.8%
2.8%
3.8%
5.1%
38.2%
13.0%
12.0%
8.4%
7.8%
5.3%
3.0%
2.8%
2.6%
2.5%
2.4%
2.0%
0.0%
100.0%
100.0%
The top ten tenants collectively accounted for 23.6% of the total GRI as at 30 September 2020 (FY2019: 21.1%). Our
largest tenant NTUC, the operator of NTUC Fairprice supermarkets, NTUC Healthcare (Unity) and NTUC Club in FCT
malls, accounted for 3.6% of the portfolio GRI (2019: 3.2%).
Top 10 Tenants by GRI as at 30 September 2020
Trade Category
As % of Total NLA
As % of Total GRI11
Tenants
NTUC12
Dairy Farm Group13
Supermarket & Hypermarket
Supermarket & Hypermarket,
Beauty & Health
Copitiam Group14
Food & Beverage
Metro (Private) Limited15
Departmental Store
Breadtalk Group16
Food & Beverage
Courts (Singapore) Pte Limited
Household
Koufu Group
Food & Beverage
Cotton On Group17
Fashion
Hanbaobao Pte Limited18
Food & Beverage
10
Yum!19
Food & Beverage
1
2
3
4
5
6
7
8
9
4.6%
3.5%
2.8%
4.2%
2.0%
2.4%
2.2%
1.5%
0.9%
1.0%
3.6%
3.2%
2.7%
2.6%
2.6%
2.2%
2.0%
1.7%
1.5%
1.5%
Total for Top 10
25.1%
23.6%
Includes Yishun 10 retail podium
Includes leases for Cold Storage supermarkets, Guardian Pharmacy & 7-Eleven
9
10 This is the aggregate shopper traffic for both North Wing and South Wing of Northpoint City
11 As percentage of GRI of FCT portfolio for the month of September 2020, excluding gross turnover rent
12 NTUC: Include NTUC FairPrice, NTUC Healthcare (Unity) and NTUC Club
13
14 Operator of Kopitiam food courts, includes Kopitiam, Bagus
15
16
17
18 Operates McDonald’s outlets
19 Operates KFC and Pizza Hut outlets
Includes leases for Metro Department Store & Clinique Service Centre
Includes Food Republic, Breadtalk, Toast Box and Din Tai Fung
Includes leases for Cotton On, TYPO, Rubi Shoes, Cotton On Body, Cotton On Kids
Contents
3 0 / F R A S E R S C E N T R E P O I N T T R U S T
OPERATIONS & FINANCIAL REVIEW
FINANCIAL REVIEW
FINANCIAL
REVIEW
FCT’S INVESTMENT PROPERTY PORTFOLIO
As at 30 September 2020, FCT’s investment property
portfolio comprises Causeway Point, Northpoint City
North Wing (including Yishun 10 retail podium), Changi
City Point, Bedok Point, YewTee Point and Anchorpoint.
INVESTMENTS HELD IN ASSOCIATES AND JOINT
VENTURES
AsiaRetail Fund Limited (“ARF”)
As at 30 September 2020, FCT holds a 36.89% interest
in ARF. On 3 September 2020, FCT announced the
acquisition of the remaining approximately 63.11%
stake in ARF for S$1.06 billion. The approval to proceed
with the acquisition was obtained from Unitholders
at an Extraordinary General Meeting convened on 28
September 2020. Subsequent to completion of the ARF
acquisition on 27 October 2020, FCT now owns 100%
interest in ARF whose property portfolio comprises Tiong
Bahru Plaza, White Sands, Hougang Mall, Century Square,
Tampines 1 and Central Plaza. The purchase consideration
for the 63.11% stake in ARF and the associated
transaction costs were funded by an equity fund raising
(“EFR”) which raised gross proceeds of approximately
S$1.33 billion.
Sapphire Star Trust (“SST”)
FCT holds a 40.00% stake in SST, a private trust that owns
Waterway Point.
Hektar Real Estate Investment Trust (“H-REIT”)
FCT holds 31.15% of the units in H-REIT. H-REIT, an
associate of FCT, is a retail-focused REIT in Malaysia
listed on the Main Market of Bursa Malaysia Securities
Berhad. Its property portfolio comprises Subang Parade
(Selangor), Mahkota Parade (Melaka), Wetex Parade
(Johor), Central Square (Kedah), Kulim Central (Kedah) and
Segamat Central (Johor).
FINANCIAL PERFORMANCE OF INVESTMENT PROPERTY
PORTFOLIO
The tables presented below show the gross revenue,
property expenses and net property income for FCT’s
investment property portfolio for FY2020 and FY2019.
Gross Revenue
S$’000
FY2020
(1 Oct 2019 – 30 Sep 2020)
FY2019
(1 Oct 2018 – 30 Sep 2019)
Increase/
(Decrease)
Causeway Point
Northpoint City North Wing*
Anchorpoint
YewTee Point
Bedok Point
Changi City Point
Total
Property Expenses
S$’000
Causeway Point
Northpoint City North Wing*
Anchorpoint
YewTee Point
Bedok Point
Changi City Point
Total
*
Includes Yishun 10 retail podium
73,237
44,396
6,873
12,488
5,649
21,734
86,458
(15.3%)
53,089
(16.4%)
8,555
(19.7%)
14,443
(13.5%)
6,506
(13.2%)
27,335
(20.5%)
164,377
196,386
(16.3%)
FY2020
(1 Oct 2019 – 30 Sep 2020)
FY2019
(1 Oct 2018 – 30 Sep 2019)
Increase/
(Decrease)
20,308
12,865
3,877
4,182
3,626
8,631
53,489
20,693
13,876
4,747
4,135
3,843
9,809
(1.9%)
(7.3%)
(18.3%)
1.1%
(5.6%)
(12.0%)
57,103
(6.3%)
A N N U A L R E P O R T 2 0 2 0 / 3 1
Net Property Income
S$’000
FY2020
(1 Oct 2019 – 30 Sep 2020)
FY2019
(1 Oct 2018 – 30 Sep 2019)
Increase/
(Decrease)
Causeway Point
Northpoint City North Wing*
Anchorpoint
YewTee Point
Bedok Point
Changi City Point
Total
PERFORMANCE COMPARISON BETWEEN FY2020
AND FY2019
Gross revenue for the year ended 30 September 2020
totalled S$164.4 million, a decrease of S$32.0 million
or 16.3% over the corresponding period last year. The
decrease was mainly due to rental rebates assistance
granted to tenants.
FCT’s property portfolio continued to achieve positive
rental reversions during the year. Rentals from renewal
and replacement leases from the Properties which
commenced during the period, showed an average
increase of 4.0% over the expiring leases.
Property expenses for the year ended 30 September 2020
totalled S$53.5 million, a decrease of S$3.6 million or
6.3% compared to the corresponding period last year.
The decrease was mainly due to lower property
manager’s fee arising from lower gross revenue and net
property income and lower marketing expenses during
the year. It was partially offset by absence of write-back
of property tax not required and higher provision for
doubtful debts during the year.
Net property income for the year ended 30 September
2020 was therefore at S$110.9 million, being S$28.4
million or 20.4% lower than the corresponding period
last year.
52,929
31,531
2,996
8,306
2,023
13,103
110,888
65,765
(19.5%)
39,213
(19.6%)
3,808
(21.3%)
10,308
(19.4%)
2,663
(24.0%)
17,526
(25.2%)
139,283
(20.4%)
Net non-property expenses of S$45.5 million was
S$2.9 million higher than the corresponding period
last year mainly due to higher borrowing costs from
additional borrowings and increase in Manager’s
management fees arising from the increase in total
assets. It was partially offset by interest income from loan
to joint venture.
Total return included:
i. unrealised loss of S$1.1 million arising from fair
valuation of interest rate swaps for the hedging of
interest rate in respect of S$128 million of the loans;
ii. share of associates’ results of S$75.3 million;
iii. share of joint ventures’ results of S$11.2 million;
iv. expenses in relation to acquisitions of an associate and
a joint venture of S$3.8 million; and
v. surplus on revaluation of the Properties of
S$4.7 million.
Income available for distribution for the year ended
30 September 2020 was S$101.1 million, which was
S$17.6 million lower compared to the corresponding
period in the preceding financial year.
*
Includes Yishun 10 retail podium
Contents
3 2 / F R A S E R S C E N T R E P O I N T T R U S T
OPERATIONS & FINANCIAL REVIEW
FINANCIAL REVIEW
DISTRIBUTION
Distribution to Unitholders for the year ended 30
September 2020 was S$101.1 million, which was 15.5%
lower compared with the last financial year, due to the
decline in the revenue and net property income impacted
by the rental rebates provided to tenants in 2HFY2020.
The decline in distribution to Unitholders was partially
offset by the release of the retained distribution of S$18.0
million from 1HFY2020 and the full year contributions of
dividend received from FCT’s investments in ARF and SST.
The breakdown and comparison of the DPU for FY2020
and FY2019 are presented below:
Distribution per Unit (S cents)
Financial year ended 30 September
FY2020
FY2019
First quarter (1 October – 31 December)
Second quarter (1 January – 31 March)
Third quarter (1 April – 30 June)
Fourth quarter (1 July – 30 September)
Full Year (1 October – 30 September)
3.060
1.610
4.372
9.042
3.020
3.137
3.000
2.913
12.070
Note: FCT has moved to half-yearly reporting and half-yearly distribution payment from 2HFY2020 onwards.
TOTAL ASSETS, NET ASSET VALUE PER UNIT AND NET
TANGIBLE ASSET PER UNIT
As at 30 September 2020, the total assets of FCT stood
at S$3,883 million, an increase of approximately S$272
million from S$3,611 million a year ago. The increase was
mainly attributable to a) investment in the shares in ARF;
as well as b) revaluation surplus of S$4.7 million on FCT’s
investment properties.
FCT’s net assets stood at S$2,538 million as at 30
September 2020, an increase of approximately S$67
million compared with S$2,471 million a year ago.
Correspondingly, the net asset value (“NAV”) and the net
tangible asset (“NTA”) of FCT increased to S$2.27 per unit
from S$2.21 a year ago.
As at
30 September 2020
30 September 2019
NAV and NTA per unit (S$)
2.27(a)
2.21(b)
(a) The number of units used for computation of NAV and NTA per unit as at 30 September 2020 is 1,120,330,196. This comprises:
(i) 1,119,447,127 units in issue as at 30 September 2020;
(ii) 255,647 units issuable to the Manager in November 2020, in satisfaction of 20% of the base fee component of the Manager’s management fees
payable to the Manager for the quarter ended 30 September 2020; and
(iii) 627,422 units issuable in November 2020, in satisfaction of 20%, 20%, 50% and 20% of the performance fee component of the Manager’s
management fees payable to the Manager for the quarters ended 31 December 2019, 31 March 2020, 30 June 2020 and 30 September 2020
respectively.
(b) The number of units used for computation of NAV and NTA per unit as at 30 September 2019 is 1,117,509,051. This comprises:
(i) 1,116,284,043 units in issue as at 30 September 2019;
(ii) 373,973 units issued to the Manager in October 2019, in satisfaction of 35% of the base fee component of the Manager’s management fees
payable to the Manager for the quarter ended 30 September 2019; and
(iii) 851,035 units issued to the Manager in October 2019, in satisfaction of 20%, 20%, 55% and 35% of the performance fee component of the
Manager’s management fees payable to the Manager for the quarters ended 31 December 2018, 31 March 2019, 30 June 2019 and 30 September
2019 respectively.
A N N U A L R E P O R T 2 0 2 0 / 3 3
APPRAISED VALUE OF PROPERTIES
Independent valuations of the investment properties
were undertaken by CBRE Pte Ltd (“CBRE”), Colliers
International Consultancy & Valuation (Singapore) Pte Ltd
(“Colliers”) and Savills Valuation and Professional Services
(S) Pte Ltd (“ Savills”). Independent valuations of asset
held for sale were undertaken by Jones Lang LaSalle LP
(“JLL”) and Colliers.
Valuation methods used for the investment properties
include the capitalisation approach, discounted cash flow
analysis and direct comparison method in determining
the fair values of the properties. Residual method and
direct comparison method were used for Bedok Point
which is classified as asset held for sale.
Annual valuations are required by the Code on Collective
Investment Schemes.
The total appraised value of FCT’s portfolio of properties
as at 30 September 2020 stood at S$2,857.5 million,
compared with S$2,846 million a year ago. The appraised
values of Causeway Point, Northpoint City North Wing
and YewTee Point were relatively stable compared to a
year ago. The properties Changi City Point, Anchorpoint
and Yishun 10 retail podium saw declines in their
respective appraised values. Bedok Point registered
a S$14 million gain in appraised value, based on the
divestment price of the property which was announced
on 3 September 2020. The appraised value of Waterway
Point in which FCT has a 40% shareholding via a joint
venture, remained unchanged at S$1,300 million.
Properties
Causeway Point
Northpoint City North Wing1
Changi City Point2
Anchorpoint
YewTee Point
Bedok Point
Yishun 10 retail podium
Total
Waterway Point
As at 15 September 2020
As at 30 September 2019
Appraised
Value
(S$ million)
1,305.0
771.5
338.0
110.0
190.0
108.0
35.0
2,857.5
1,300.07
Valuer
Capitalisation
rate used
Appraised
Value
(S$ million)
Valuer
Capitalisation
rate used
Savills
Colliers
Savills3
Colliers4
CBRE5
See
Note 6
Savills
4.75%
4.75%
5.00%
4.50%
5.00%
Not
applicable
1,298.0
771.5
342.0
113.5
189.0
94.0
Savills
Colliers
Savills
Colliers
CBRE
CBRE
4.75%
4.75%
5.00%
4.50%
5.00%
5.00%
3.75%
38.0
Savills
3.75%
JLL
4.50%
2,846.0
Notes:
1
2
3
4
5
6
7
Excludes CSFS space of 10,505 square feet
Excludes CSFS space of 3,391 square feet
This is Savills’s third year as valuer for Changi City Point, as permitted by the revised Collective Investment Scheme (“CIS”) Code Appendix 6 clause
8.3(e)
This is Colliers’ third year as valuer for Anchorpoint, as permitted by the revised CIS Code Appendix 6 clause 8.3(e)
This is CBRE’s third year as valuer for YewTee Point, as permitted by the revised CIS code Appendix 6 clause 8.3(e)
Based on the sale price of Bedok Point in the divestment of Bedok Point as announced on 3 September 2020. The sale price was arrived at after taking
into account the independent valuations conducted by JLL (commissioned by HSBC Institutional Trust Services (Singapore) Limited (in its capacity as
trustee of FCT)) and Colliers (commissioned by the Manager). JLL, in its report dated 1 August 2020, had stated that the open market value of Bedok
Point as at 1 August 2020 was S$108.9 million and Colliers, in its report dated 1 August 2020, had stated that the open market value of Bedok Point as
at 1 August 2020 was S$107.2 million.
FCT owns 40.0% of Sapphire Star Trust which holds Waterway Point. The value reflected in this table is the total value of Waterway Point and FCT’s
40.0% interest amounts to S$520 million.
Contents
3 4 / F R A S E R S C E N T R E P O I N T T R U S T
CAPITAL
RESOURCES
OVERVIEW
SOURCES OF FUNDING
The Manager of Frasers Centrepoint Trust (“FCT”)
continues to maintain a prudent financial structure
and adequate financial flexibility to ensure that it has
access to capital resources at competitive cost. The
Manager proactively manages FCT Group’s cash flows,
financial position, debt maturity profile, cost of funds,
interest rates exposure and overall liquidity position. The
Manager monitors and maintains a level of cash and cash
equivalents deemed adequate by management to meet
its operational needs. It also maintains an amount of
available banking facilities with reputable banks deemed
sufficient by management to ensure FCT Group has access
to diversified sources of bank borrowings.
FCT Group relies on the debt capital and syndicated loans
markets, equity market and bilateral bank facilities for its
funding needs. The Manager maintains active relationship
with banks which are located in Singapore. The principal
bankers of FCT Group are BNP Paribas, Citibank. N.A.,
Singapore Branch, Credit Industriel et Commercial,
Singapore Branch, DBS Bank Ltd and Oversea-Chinese
Banking Corporation Limited.
As at 30 September 2020, FCT Group has a total capacity
of S$5,025 million from its sources of funding, of which
S$1,255 million or 25.0% has been utilised. The following
table summarises the capacity and the amount utilised
for each of the sources of funding:
Sources of Funding
Type
Capacity
Amount Utilised
% Utilised
Revolving credit facilities
Unsecured
S$445 million
S$325 million1
Medium Term Note Programme
Unsecured
S$1,000 million
S$150 million
Bank borrowings
Bank borrowings
Unsecured
S$310 million
S$310 million
Secured
S$270 million
S$270 million2
Multicurrency Debt Issuance Programme
Unsecured
S$3,000 million
S$200 million
Total
S$5,025 million
S$1,255 million
73.0%
15.0%
100.0%
100.0%
6.67%
25.0%
1
2
S$245 million has been paid down from equity proceeds on 27 October 2020.
S$80 million Secured Term Loan has been prepaid on 7 October 2020 from the equity proceeds and the collaterals have been discharged.
Please refer to Note 35 Subsequent Events to the
Financial Statements on page 211.
DEBT PROFILE
CREDIT RATINGS
FCT has corporate credit ratings from S&P Global Ratings
(“S&P”) and Moody’s Investors Service (“Moody’s”).
FCT has been assigned a corporate rating of “BBB” with
a stable outlook by S&P and a corporate rating of “Baa2”
with a stable outlook by Moody’s. In addition, FCT’s
multicurrency Medium Term Note Programme (“MTN
Programme”) has been rated “BBB” by S&P.
During the year, FCT Group drew on S$119 million of the
term loan facility, tapped into the debt capital market for
bond issue of S$200 million under its Multicurrency Debt
Issuance Programme and prepaid S$136 million secured
term loan in exchange for S$200 million committed
revolving credit facilities.
FCT Group’s total debt stood at S$1,255 million on
30 September 2020 for which it comprised S$270 million
secured bank borrowings, $635 million unsecured
bank borrowings and $350 million unsecured Notes.
S$205 million of borrowings (about 16.3% of total
borrowings) maturing in the next 12 months has been
paid down and/or refinanced. The interest cover for the
year ended 30 September 2020 was 4.95 times. FCT
Group’s gearing stood at 35.9% as at 30 September 2020
(30 September 2019: 32.9%). The higher gearing level
was attributed to the increase in borrowings relating to
FCT’s acquisition of the additional 12% interest in ARF and
for working capital purposes during the financial year.
However, the increase in gearing level has not changed
the risk profile of FCT and is well within the 50.0%
(FY2019: 45.0%) limit set by the Monetary Authority
of Singapore.
A N N U A L R E P O R T 2 0 2 0 / 3 5
KEY FINANCIAL METRICS
Financial Year ended 30 September
2020
2019
Total Borrowings
Gearing1
Interest Cover2
Average all-in cost of borrowing
Average debt maturity
S$1,255.0 million
S$1,042.1 million
35.9%
4.95 times
2.43%
2.1 years
32.9%
5.34 times
2.63%
2.3 years
1
2
In accordance with Property Funds Appendix, the gearing ratio included FCT’s proportionate share (40%) of deposited property value and borrowings in
Sapphire Star Trust (which owns Waterway Point).
Calculated as earnings before interest and tax (EBIT) divided by interest expense.
FCT Group holds derivative financial instruments to hedge its interest rate risk exposure. The fair value of derivative
liabilities as at 30 September 2020 of S$7.4 million (2019: S$1.0 million) is disclosed in Note 13 Financial Derivatives to
the Financial Statements on page 188. The fair value of financial derivatives represented 0.29% (2019: 0.04%) of the net
assets of FCT Group as at 30 September 2020.
DEBT MATURITY PROFILE AS AT 30 SEPTEMBER 2020
Financial Year ended 30 September
Amount Due
As % of total borrowings
< 1 year
1 to 2 years
2 to 3 years
3 to 4 years
> 4 years
Total Borrowings
S$1,255 million
S$255.0 million1 & 2
S$350.0 million1
S$391.0 million
S$189.0 million
S$70.0 million
S$1,255.0 million
20.3%
27.9%
31.2%
15.0%
5.6%
100.0%
S$255 million1 & 2
(20.3% of total
borrowings)
S$350 million1
(27.9% of total
borrowings)
S$391 million
(31.2% of total
borrowings)
S$189 million
(15.0% of total
borrowings)
S$70 million
(5.6% of total
borrowings)
Total Borrowings
< 1 year
1 to 2 years
2 to 3 years
3 to 4 years
> 4 years
1
2
S$245 million has been paid down from equity proceeds on 27 October 2020.
S$80 million Secured Term Loan has been prepaid on 7 October 2020 from the equity proceeds and the collaterals have been discharged.
Please refer to Note 35 Subsequent Events to the Financial Statements on page 211.
Contents
3 6 / F R A S E R S C E N T R E P O I N T T R U S T
RETAIL PROPERTY
MARKET OVERVIEW
This report was prepared by Cistri Pte. Ltd.
1. INTRODUCTION
The purpose of this report is to provide an independent
review of the Singapore retail market, with particular
reference to the suburban shopping centre market.
We do not look at any assets specifically but at the
market as a whole.
First, we consider some of the macro-economic drivers of
the retail market, including economic growth, inflation,
tourism and population growth.
Second, we look at the shopping centre market in more
detail, providing an analysis of key market dynamics such
as shopping centre supply, rental and occupancy growth.
Finally, we provide a summary of some of the key trends
we have seen in the market over the past 12 months that
are impacting shopping centre performance.
Impact of COVID-19
At the time of the writing of this report, the world has
been heavily impacted by the COVID-19 pandemic,
resulting in many economies going into a recession.
The Singapore Government has reacted strongly both
from a healthcare perspective as well as an economic
perspective.
There is a significant amount of uncertainty surrounding
the short, medium and long-term implications of the
COVID-19 pandemic. We have presented our views in this
report but note the inherent risks in forecasting in this
environment. This report must be read in this context.
Our broad assumptions regarding the COVID-19
pandemic are that:
• The remainder of this year remains challenging and
uncertain. While businesses are gradually opening up,
there still exists the risk of a second wave which could
result in a return to Circuit Breaker conditions.
• Some extent of international travel will continue to
be permitted but the focus will remain on (a) business
travel, and (b) only with countries that Singapore
develops bilateral agreements with for safe travel.
Recovery in the tourism market will be gradual and will
span a few years, with limited real growth before 2022.
• A vaccine will not be fully distributed within the next
six months, but screening, testing and social distancing
will allow for easier containment and the gradual
resumption of economic activities.
• Economic recovery is assumed to span two to three
years. Domestic economic activity is expected to
rebound relatively stronger and faster (i.e. within the
next one to two years), as compared to trade and
tourism which may only turn the corner at a later
period.
2. ECONOMIC CONTEXT
Critical to any understanding of the future of the retail
market in Singapore is understanding the underlying
economic context. This section provides a background
analysis of the Singapore economy, providing high-level
forecasts with some key economic indicators.
Current Situation
Regardless of the strong underlying economic
fundamentals of Singapore, the current pandemic has had
and will continue to have a major impact on the country.
With Singapore’s success being built on globalisation
and trade, the global economic turmoil and international
travel restrictions have had an outsized effect on
Singapore. As a result, the nation is riding through one of
the most difficult periods in its relatively short modern
economic history.
The Singapore economy was already facing challenges
before the pandemic. Global trade tensions, mostly
involving the USA and China, were already straining
global economic growth in 2019. Domestically, pockets
of economic weakness had also appeared in some
manufacturing segments that had traditionally been
strong drivers of growth. For instance, value-added from
refined petroleum products fell by close to 28.4% in 2019
while chemicals & chemical products followed a similar
trend, falling by close to 17.9%. The retail market was
also under pressure, with retail sales value declining by
2.6% in 2019.
As a result, prior to the pandemic in February 2020, MTI
had forecast economic growth for the year to fall to
between -0.5% and 1.5%, low by historic standards.
The global pandemic reset all assumptions of economic
growth. Many lost their jobs, incomes fell and work
productivity declined with COVID-19 movement
restrictions. Many industries ground to a halt earlier
in the year – including much of the retail industry – as
the Circuit Breaker from 7 April to 1 June forced many
businesses to shut and others to work from home.
The Government responded with massive support – four
budgets in four months and close to S$100 billion of
targeted expenditure (or close to 20% of GDP). Since
mid-June, Singapore also managed to gradually reopen
its economy, with most industries back in operation albeit
with some safe distancing restrictions. Manufacturing
output surged 24.2% YoY in September, driven by strong
A N N U A L R E P O R T 2 0 2 0 / 3 7
activity in the pharmaceutical and electronics sectors.
The resumption of dine-in services is also seeing the F&B
sector re-hiring for around 1,000 positions, though take-
up has been slow.
still quite restrictive. A full lifting of travel restrictions
is unlikely to occur until a vaccine or effective
treatment is found and distributed globally.
• Business productivity is likely to remain down because
Notwithstanding this, the Government still expects GDP
to decrease by between -6.0% and -6.5% this calendar
year. Similarly, Oxford Economics has forecast Singapore’s
2020 GDP to contract by -6.0% (Chart 2.2).
Medium-Term Outlook
While we are just starting to emerge from the depths of
a major economic shock, it is difficult to be too certain
on the short-term economic outlook. However, there are
definite medium-term ramifications:
• Singapore’s tourism-related sectors will struggle to
rebound while international travel is curtailed. While
some Air Travel Passes have been established (e.g. with
Hong Kong, China, Australia etc.), these are generally
of safe-distancing and office capacity limits.
• Footfall at malls has picked up since Phase 2 in
mid-June but is still low when compared to pre-
COVID-19 levels.
At the same time, there are emerging trends on a global
level that provide reasons to be more optimistic:
• More than 10 COVID-19 vaccine candidates globally
have reached the final phase of trials, with Pfizer–
BioNTech’s vaccine even being recently approved by
the UK and Canadian Governments for distribution.
• YoY monthly retail sales growth in China, USA and the
Euro Area has entered positive territory from as early
as June and is continuing to show further growth
(Chart 2.1).
Chart 2.1 Monthly YoY Retail Sales Growth
January to September 2020
10%
5%
0%
-5%
-10%
-15%
-20%
25%
USA
China
Euro Area
First month of positive YoY growth
Jan-20
Feb-20
Mar-20
Apr-20
May-20
Jun-20
Jul-20
Aug-20
Sep-20
Source: US Census Bureau, Eurostat, China National Bureau of Statistics; Data for China for Janurary and February are not available.
Long-Term Outlook
Our view of Singapore’s long-term potential remains
positive in both absolute and relative terms.
From an economic and political perspective, Singapore
is expected to maintain its strong positioning as an ideal
business hub.
Singapore has a history of economic growth and the
ability to ride out economic shocks because of the
Government’s prudent economic management. When
faced with challenges, the Government makes difficult
decisions even if they are unpopular strategies.
Chart 2.2 Singapore Real GDP Growth (2015 Prices)
2010 – 2030
Therefore, notwithstanding the short and medium-term
challenges to Singapore’s outlook, we remain optimistic
about the longer-term potential for Singapore’s growth.
14.5%
2010 - 2019 Average Growth: +3.8% p.a.
Forecast
2020 - 2030 Average Growth: +3.4% p.a.
6.3%
4.5%
4.8%
3.9%
3.0%
3.2%
4.3%
3.4%
5.7%
4.3%
3.5%
3.4%
3.3%
3.2%
3.1%
2.8%
2.6%
2.4%
0.7%
-6.0%
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030
Source: Oxford Economics
Contents
3 8 / F R A S E R S C E N T R E P O I N T T R U S T
RETAIL PROPERTY
MARKET OVERVIEW
Chart 3.1 Consumer Price Inflation
2010 – 2030
5.3%
2010 - 2019 Average Growth: +1.5% p.a.
Forecast
2020 - 2030 Average Growth: +1.8% p.a.
4.6%
2.8%
2.4%
1.0%
0.6%
0.4%
0.6%
0.5%
-0.5%
-0.5%
-0.2%
2.0%
2.1%
2.1%
2.0%
1.9%
1.8%
1.8%
1.7%
1.7%
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030
Source: SingStat, Oxford Economics
As we move into 2021, we expect a strong rebound in
Singapore’s GDP to be followed by some moderation.
This is assuming Singapore can further ease its travel,
trade and business restrictions as the COVID-19 pandemic
comes under control. Given the country’s reliance on
global trade, another important assumption is that USA
President-elect Joe Biden will be able to bring some
normalisation to trade relations and foreign policy from
the assumed start of term next year.
Overall, we expect GDP to grow at an average rate of
3.4% p.a. across 2020 – 2030.
3. INFLATION
In recent years, CPI has remained very low, creating
a challenging environment for retailers and mall
owners alike.
The COVID-19 pandemic has worsened this, with CPI
expected to hit a low of -0.2% in 2020. This is close to
levels seen in 2015 – 2016 during the oil price plunge.
However, the impact varies across product categories.
According to the latest September 2020 CPI data released
by SingStat, categories such as food retail & catering
(+1.8%), telecommunication services (+2.3%) and
homewares (+0.7%) have tracked positive YoY CPI growth
for September. This is likely due to the increased reliance
Chart 4.1 Population Growth
2010 – 2030
on such products as majority of the Singapore population
continue spending much of their time at home.
On the contrary, deflation in categories such as fashion
(-4.6%) and travel & recreation (-1.2%) have offset this
because of the depressed demand for these items amidst
continued social distancing restrictions.
Given the current weak economic environment,
forecasting stronger CPI would sometimes be counter
intuitive. However, given the large scale of economic
stimulus in Singapore particularly in the form of
quantitative easing, there is an expectation that this
could drive a short-term spike in inflation in the
coming years.
Overall, we expect CPI to average at around 1.8% p.a.
across 2020 – 2030, peaking at 2.1% in 2023.
4. POPULATION GROWTH
Singapore’s population growth has stabilised at around
1.3% p.a. over the past decade. Typically, in years of
economic crisis, we observe a dip in growth due to a
combination of lower inward migration and higher
outward migration. This was seen in 2017 during the oil
price crisis and is expected to occur again in 2020 due to
the impact of COVID-19.
2.5%
2010 - 2019 Average Growth: +1.3% p.a.
Forecast
2020 - 2030 Average Growth: +1.3% p.a.
2.1%
1.8%
1.6%
1.3%
1.2%
1.3%
1.8%
1.5%
1.2%
1.0%
1.3%
1.2%
1.3%
1.3%
1.3%
1.3%
1.3%
0.5%
0.1%
-0.3%
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030
Source: SingStat, Cistri
According to SingStat’s latest data, Singapore’s
population has declined marginally by -0.3% in 2020
to 5.7 million in end-June. This represents a decrease of
around 17,800 people from 2019 and was driven largely
by the repatriation of non-residents (-35,800) and some
permanent residents (-4,300), and offset by natural
citizen population growth (+22,300).
Given the very low birth rate in Singapore, inward
immigration remains a key policy tool that the
Government can use to support economic growth.
As work permit holders (excluding domestic workers)
constituted more than 60% of the outflow of non-
residents this year, we expect a strong demand for this
group of workers to return over the next two years
as construction projects that were halted during the
pandemic resume.
Overall, we forecast population growth to average at
around 1.3% p.a. across 2020 – 2030 to reach 6.5 million
by 2030.
5. TOURISM GROWTH
The tourism market is extremely important for Singapore.
In 2019, tourism contributed about 4% to Singapore’s
GDP directly.
In 2020, global air travel and tourism came to a standstill
amidst comprehensive travel restrictions during the
pandemic. Singapore’s total visitor arrivals fell by
more than 80% during the first three quarters of 2020
compared the same period last year. Other tourism-
related sectors including hospitality, entertainment and
retail (particularly those located within the Central Core
area of Singapore with exposure to tourism) will struggle
to rebound while international travel is curtailed.
With that said, Singapore has taken steps to reopen
its borders and revive the Changi aviation hub. These
include:
• Air Travel Pass: Unilateral lifting of border restrictions
by Singapore for short-term visitors (including leisure
travel) from selected countries such as Australia,
Mainland China and Vietnam. These countries have
comprehensive public health surveillance systems and
display successful control over the spread of COVID-19.
Visitors can go about their activities after receiving
a negative COVID-19 test result in Singapore. Take-
up of the Air Travel Pass is likely to be muted if these
countries do not have equivalent rules.
• Reciprocal Green Lane: Bilateral arrangements for
essential short-term business and official travel
between both countries. For now, Singapore has such
travel arrangements with five countries including
Japan, South Korea and Mainland China (for certain
provinces). Currently, travellers must adhere to a
controlled itinerary for the first two weeks of stay in
Singapore, limiting its take-up.
• Air Travel Bubble: Reciprocal travel arrangements
for leisure travellers without the need to be
quarantined but subject to testing negative for
COVID-19.
A N N U A L R E P O R T 2 0 2 0 / 3 9
In the longer term, the Government has ambitious plans
to significantly boost tourism in Singapore. The plans
include:
• Changi City and Terminal 5: Originally scheduled for
completion in the 2030s, Terminal 5 will increase the
airport’s capacity by 50 million to 135 million. The
proposed waterfront, business, and lifestyle district of
Changi City will be integrated with Changi Airport and
will offer multiple tourism opportunities. Construction
of the Terminal 5 project is paused for at least two
years to allow the authorities to consider changes that
need to be made in meeting the needs of post-COVID
travel.
• Sentosa-Brani Masterplan: A significant and long-term
masterplan to redevelop Sentosa and Pulau Brani into
a larger leisure and tourism destination was recently
unveiled. The plan will be implemented in phases
over the next two to three decades. The first project,
Sentosa Sensoryscape will be completed in 2022.
• Marina Bay Sands (MBS) and Resorts World Expansion
(RWS): Approximately S$9 billion will be invested into
the two existing integrated resorts to expand and
refresh their non-gaming components. New additions
include an indoor entertainment arena and a fourth
tower at MBS as well as new attractions at the RWS
such as Minion Park, Super Nintendo World and
new hotels.
• Jurong Lake District: A new Science Centre and
tourism development will be developed by 2026, with
the Government’s intention to spread the benefits of
tourism across Singapore. STB is presently holding an
expression of interest exercise for development.
• Mandai Nature Project: A Bird Park (2021), Rainforest
Park (2023) and an eco-friendly resort (2023) will be
completed alongside the existing Singapore Zoo, Night
Safari and River Safari. Together, they will form a large
126-hectare eco-tourism hub.
In addition to these plans for tourist infrastructure and
attractions, the Government partnered with Airbnb
Experiences and Expedia to promote Singapore as a
destination of choice as international travel gradually
resumes.
6. RETAIL SALES
The Singapore retail market was already experiencing a
low growth period prior to the COVID-19 pandemic. A
slowing economy (refer to Section 1), sluggish population
growth and lack of inflation in the market had resulted in
limited growth in nominal retail sales over the past five
years. Furthermore, since 2013, retail sales productivity
(i.e. retail sales per sq.ft) across the market had been in
decline as retail sales growth stalled while the supply of
retail floorspace continued to increase.
At the same time, online sales continued to grow in
Singapore. According to SingStat, online retail sales
accounted for approximately 5.8% of total retail sales
in 2019. While cross-country comparison is challenging
due to differences in calculation methods, available data
suggests that this is relatively low by global standards;
mature markets like UK and USA see online retail taking
up shares of above 10%.
Contents
4 0 / F R A S E R S C E N T R E P O I N T T R U S T
RETAIL PROPERTY
MARKET OVERVIEW
Chart 6.1 YoY Total Retail Sales Growth
October 2019 – September 2020
-1.1%
-2.3%
-1.0%
-1.0%
-11.1%
-11.4%
-8.5%
-8.9%
-12.9%
-24.9%
-33.9%
-45.9%
Circuit Breaker
Oct-19
Nov-19
Dec-19
Jan-20
Feb-20
Mar-20
Apr-20
May-20
Jun-20
Jul-20
Aug-20
Sep-20
Source: SingStat
Current Situation
The impact of COVID-19 on the retail market has been
severe. Monthly YoY retail sales fell at their fastest rate on
record in May this year (-45.9%; excluding motor vehicles
and F&B) as Circuit Breaker restrictions led to strict social
distancing measures including the shutdown of most
workplaces and non-essential retail services. There has
since been some recovery with the Government’s gradual
easing of restrictions over the past few months, but the
overall market remains in negative territory.
Discretionary items were hardest hit (Chart 6.2), with
watches & jewellery (-33.7%), department stores (-33.6%)
and wearing apparel & footwear (-27.9%) registering
some of the steepest declines across all product
categories for the year ending September 2020.
Similarly, food caterers (-37.3%) were severely affected
by restrictions on large group gatherings. This decline
was relatively less severe for other F&B operators as
they were still able to operate on a takeaway or delivery
basis for most of the Circuit Breaker period and have
now mostly resumed dine-in (though with some capacity
restrictions).
In contrast, sales increased significantly for supermarkets
& hypermarkets (+24.5%) and mini-marts & convenience
stores (+3.3%) as shoppers took the opportunity to stock
up on groceries and sundries.
Medium-Term and Long-term Outlook
Given slowing retrenchments and a more moderated
decline in total employment in Q3 2020, we expect
domestic-sourced retail sales to rebound relatively well
over the next 18 months as social distancing restrictions
are further eased. Any new COVID-19 outbreaks will keep
growth in check, particularly if a new round of Circuit
Breaker is implemented.
Chart 6.2 Annual Retail Sales Growth by Category
October 2019 – September 2020 versus October 2018 – September 2019
Supermarkets & Hypermarkets
Mini-marts & Convenience Stores
Computer & Telecommunications Equipment
Fast Food Outlets
Furniture & Household Equipment
Recreational Goods
Medical Goods & Toiletries
Optical Goods & Books
Wearing Apparel & Footwear
Restaurants
Food Retailers
Department Stores
Watches & Jewellery
-33.6%
-33.7%
Food Caterers
-37.3%
Source: SingStat, Cistri
-2.3%
-6.8%
-9.1%
-13.9%
-19.0%
-22.0%
-27.9%
-28.0%
-29.4%
3.3%
24.5%
Annual Growth for
Year Ending September2020
A N N U A L R E P O R T 2 0 2 0 / 4 1
Chart 6.3 Nominal Retail Sales Growth (Excluding Online)
2010 – 2030
6.9%
7.1%
2010 - 2019 Average Growth: +1.0% p.a.
10.0%
8.9%
2020 - 2030 Average Growth: +4.7% p.a.
3.0%
1.0%
0.8%
0.8%
4.4%
3.3%
3.3%
3.2%
3.2%
3.5%
3.4%
3.4%
-0.5%
-0.7%
-1.9%
-0.03%
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030
-17.4%
Forecast
Source: SingStat, Cistri
At the same time, we do not expect travel restrictions
to be fully lifted until at least 2022. As tourist spending
continues to be curtailed, total retail sales are unlikely to
return to 2019 levels by next year and will likely take till
2022 or possibly later.
In consideration of the above, we expect total nominal
retail sales growth to average at around 4.7% p.a. across
2020 – 2030, peaking at 10.0% in 2021.
This forecast also takes into account the impact of online
retail1 which we have assumed to constitute around
9.2% of total resident spend in Singapore in 2020 (i.e.
remaining 90.8% goes to physical stores). We expect
that this level will decline somewhat once shopping
and working patterns return to normal but will still
remain elevated compared to historic levels. By 2025, we
forecast online retail spend to constitute around 9.6%
of total resident spend in Singapore, compared to an
estimated 6.4% in 2019.
7. RETAIL SUPPLY
Cistri’s retail floor space projections include announced
retail projects, longer-term allowances for unannounced
future projects, as well as allowances for obsolescence.
Supply forecasts for announced projects are based on
the URA’s commercial projects pipelines and developers’
intentions (Table 7.1 and 7.2).
Cistri estimates total retail floorspace in Singapore to
reach 67.3 million sq.ft (NLA) by end-2020. While 2019
had seen the largest amount of new floorspace (1.2
million sq.ft) entering the market in recent years, growth
will soften significantly in 2020 to around 580,000 sq.ft.
Major completions expected in 2020 are listed below.
We note that construction disruptions brought about by
COVID-19 may delay opening timelines:
• Tekka Place (70,000 sq.ft) – A neighbourhood mall
located in Little India and owned by LaSalle Investment
Management Asia and Lum Chang Holdings. It opened
in March 2020 and is anchored by NTUC FairPrice and
the Xin Tekka Food Hall.
Chart 7.1 Retail Floorspace Supply
Singapore, 2010 – 2025 (Million sq.ft)
57.4
30.2
58.9
30.6
60.2
30.9
61.8
31.1
63.7
64.3
65.1
65.4
30.9
31.5
31.2
30.9
65.5
30.6
Forecast
66.7
67.3
67.7
68.4
69.1
69.9
30.4
30.4
30.4
30.6
30.7
30.9
70.7
31.1
8.3
18.9
8.6
19.6
9.1
10.7
20.2
20.3
11.0
11.0
11.8
12.3
12.7
13.4
13.7
13.9
14.1
14.4
14.7
15.0
21.7
21.8
22.1
22.1
22.2
22.9
23.2
23.3
23.7
24.0
24.3
24.6
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
Total • Other Retail Formats • Suburban Shopping Centres • Central Area Shopping Centres
Source: URA, Developers’ Announcements, Cistri; as of November 2020
1
To local and overseas online stores.
Contents
4 2 / F R A S E R S C E N T R E P O I N T T R U S T
RETAIL PROPERTY
MARKET OVERVIEW
Table 7.1 Upcoming Retail Supply (> 60,000 sq.ft NLA)
2020 – 2025
Name
Opening Year
NLA (sq.ft)
Closest MRT/LRT
Centre Type
Canberra Plaza
Northshore Plaza I
Woodleigh Mall
Punggol Digital District
One Holland Village
Sengkang Grand Mall
Source: Cistri
2020
2021
2022
2023
2024
2024
88,000
62,200
196,000
Canberra
Neighbourhood
Samudera
Neighbourhood
Woodleigh
Neighbourhood
146,600
Punggol Coast (U/C)
Neighbourhood
61,871
112,000
Holland Village
Neighbourhood
Sengkang
Neighbourhood
• Canberra Plaza (88,000 sq.ft) – A New Generation
Neighbourhood Centre2 (NGNC) owned and developed
by the HDB that will be connected to Canberra MRT
station on the North-South line. While the mall’s
opening date has yet to be officially announced,
construction seems to be mostly completed and
NTUC FairPrice, A&W, Starbucks and GymmBoxx have
committed tenancies. Hence, we expect the mall to
open by the end of the year or early next year.
Beyond 2020, total retail floorspace is expected to
increase to around 70.7 million sq.ft over the next
five years, translating to an average growth of around
669,000 sq.ft p.a. or 1.0% p.a.. We expect this to be
largely driven by growth in shopping centre floorspace
which we estimate to grow from 54.8% of total retail
floorspace in end-2020 to 56.1% by 2030. We note that
the current pandemic may result in a slower growth in
floorspace as developers adopt a more cautious stance.
We note that the majority of new openings will be in the
form of ancillary retail rather than full-fledged malls,
with no proposed retail development above 250,000
sq.ft over the next five years. Among the new shopping
centres planned, we expect most to be in the suburban
and central fringe areas in line with the continued
decentralisation of retail and residential development
across Singapore.
In addition to the above, several other locations
identified for development under the URA’s 2019
Master Plan provide the potential for additional new
retail development. These include the Woodlands
Regional Centre, Changi Gateway, the Greater Southern
Waterfront, Tengah and Bidadari, as well as tourist
destinations like Sentosa-Brani, Jurong Lake District and
Mandai Eco-Tourism Hub.
In addition, sites in Jalan Anak Bukit, Marina View,
Woodlands and Kampong Bugis on the Government Land
Sales Reserve List by the URA (Table 7.2) also provide
opportunities for mixed-use developments with retail
components. Development on these sites will depend on
the submission of a satisfactory bid to trigger a tender
process, meaning development is likely to still be a few
years away.
8. SHOPPING CENTRE FLOORSPACE PER CAPITA
Cistri estimates the provision of shopping centre floor
space per capita in Singapore to reach approximately
6.5 sq.ft NLA in end-2020. This is projected to maintain
through to 2025. By global standards, Singapore’s
provision of shopping centre floor space per capita is
moderate (Chart 8.1).
The main difference between Singapore and other
markets with larger provisions is that Singapore has fewer
large malls (>= 500,000 sq.ft). We estimate that shopping
Table 7.2 Upcoming Government Land Sale Sites (Mixed Use / White Sites)
As of November 2020
Site
Site Area
(ha)
Proposed Gross
Plot Ratio
Maximum GFA
(sq.ft)
Capped Retail GFA
(sq.ft)
Status
Jalan Anak Bukit
Marina View
Woodlands Avenue 2
Kampong Bugis
Source: URA
3.2
0.8
2.8
8.3
3.0
13.0
4.2
N.A
96,600
220,000
Open for Tender
1,090,000
1,240,000
4,200,000
20,000
360,000
110,000
Reserve List
Reserve List
Reserve List
2
Centres developed and owned by HDB that will be built in emerging residential hubs like Sembawang, Punggol and Sengkang. These centres will combine
retail with community facilities such as play areas and event spaces.
A N N U A L R E P O R T 2 0 2 0 / 4 3
Having a high or low amount of floorspace is not good
or bad per se. Australia has a higher provision than
Singapore, but the market operates quite efficiently.
However, having a lower provision generally means
that retail floorspace can operate more efficiently and
productively on a sales per sq.ft basis.
Map 8.1 below shows the expected provision of shopping
centre floorspace per capita across Singapore’s seven
major regions by 2025.
As presented, shopping centre floorspace density will
continue to be heavily concentrated in the Central Core,
while suburban areas have relatively modest provision.
In most regions, the provision is expected to decline
over the next few years as population growth outstrips
supply growth. The Outer North and Outer Northeast
regions are exceptions to this decline. The imminent
opening of Canberra Plaza will help push up the provision
marginally within the Outer North sector, while new retail
developments at Sengkang Central and Punggol Digital
Districts will increase supply in the Outer Northeast
region (Table 7.1). However, the overall provision in these
sectors will remain low by Singapore standards.
Chart 8.1 Shopping Centre Floorspace Per Capita
(sq.ft NLA) Singapore vs Various Countries
23.1
16.8
11.4
9.9
6.5
6.5
USA (2018)
Canada (2018)
Australia (2018)
Kuala Lumpur (2019)
Singapore (2025)
Singapore (2020)
UK (2018)
Japan (2018)
France (2018)
4.6
4.5
4.3
Italy (2018)
3.0
Germany (2018)
2.3
Global benchmarks updated based on latest data availability.
Source: International Council of Shopping Centres, Cistri
centres with NLA of 500,000 sq.ft and above account for
under 30% of total shopping floor space in Singapore.
This share is much higher in other cities in the region, such
as Kuala Lumpur and most major Chinese cities.
Map 8.1 Shopping Centre Floorspace Per Capita by Region
2025
Source: SingStat, Cistri
Population for the purposes of analysis excludes domestic workers and construction workers.
Contents
4 4 / F R A S E R S C E N T R E P O I N T T R U S T
RETAIL PROPERTY
MARKET OVERVIEW
Chart 9.1 Share of Island-wide Retail Floorspace by Owner
By NLA
12.7%
6.0%
5.2%
4.2%
4.1%
3.7%
3.3%
2.8%
2.8%
2.5%
CapitaLand
Integrated
Commercial
Trust
Frasers
Centrepoint
Trust
Source: Cistri
Note: As at mid-November 2020
NTUC
Enterprise
Far East
Organisation
Lendlease
HDB
Mapletree
Commercial
Trust
United
Industrial
Corporation
Limited
Changi
Airport
Group
Frasers
Property
Chart 9.2 Share of Suburban Retail Floorspace by Owner
By NLA
10.7%
10.2%
8.8%
6.8%
6.1%
5.5%
4.7%
3.3%
2.4%
2.1%
Lendlease
HDB
Mapletree
Commercial
Trust
Changi
Airport
Group
Far East
Organisation
UOL Group
Limited
City
Developments
Ltd
CapitaLand
Integrated
Commercial
Trust
Frasers
Centrepoint
Trust
NTUC
Enterprise
Source: Cistri
Note: As at mid-November 2020
9. MARKET SHARE OF SHOPPING CENTRE NLA
BY OWNER
from suburban shopping centres whose retail offer had
strengthened over the years.
FCT is now the second-largest owner of suburban
shopping centre floorspace in Singapore, with a market
share of 10.2% following its acquisition of AsiaRetail Fund
Limited in October 2020.
CapitaLand Integrated Commercial Trust, the combined
entity of CapitaLand Mall Trust and CapitaLand
Commercial Trust, remains the largest owner of suburban
shopping centre floorspace at 10.7% while NTUC is third
with a share of 8.8%.
Lendlease is the fourth largest ‘owner’ but it is
primarily an asset manager, managing assets for third
party investors.
10. RETAIL RENTS & OCCUPANCY
Even prior to the pandemic, the Singapore retail market
has endured several difficult years. Between 2015 and
2019, shopping centre floorspace continued to increase
while retail sales declined, causing sales productivity to
fall. The decrease in sales productivity impacted retailers’
profitability and lowered their appetite for floorspace.
This trend then flowed through to rents and occupancy
as shopping centre owners endeavoured to keep their
centres occupied by lowering rents (Charts 10.1 and
10.2). The central area malls (including Orchard Road)
were under the most pressure due to rising competition
The impact of the COVID-19 pandemic on retail sales, as
outlined in Section 6, has been dramatic. However, retail
occupancy has not dropped as significantly as one might
have expected. Latest Q3 2020 data released by the URA
showed declines in occupancies of slightly more than -1%
for suburban and Orchard Road shopping centres and -4%
for shopping centres in the rest of the city area. Overall,
occupancies have still tracked at close to 90% amidst
the pandemic.
COVID-19’s relatively limited impact on occupancy
reflects the actions taken by both the Government
and many landlords in helping their tenants survive.
The Government has provided property tax rebates
and government cash grants for SME tenants of retail
properties, both of which were disbursed through
property owners and mandated to be passed on to
tenants fully. We also note that the Government has
enforced a moratorium on enforcement actions against
tenants for non-payment of rent which ends upon
issuance of notice of the cash grant or on 31 December.
Aside from this, landlords have also had to make
additional contributions, including further rental relief
and temporarily moving tenants onto turnover-rent-only
deals.
However, the COVID-19 pandemic has had its retail
victims although in many cases, COVID-19 was simply the
last of several issues facing these retailers. Several major
Chart 10.1 Retail Occupancy Rate
Singapore, 2015 – 2022
100%
98%
96%
94%
92%
90%
88%
86%
84%
82%
80%
A N N U A L R E P O R T 2 0 2 0 / 4 5
Forecast
Suburban
Orchard Road
Rest of City Area
2015
2016
2017
2018
2019
2020
2021
2022
Source: URA, Cistri
international retailers, such as Robinsons, Topshop and
Espirit, have closed or will be closing their multiple stores
across Singapore. This will undoubtedly have an impact
on occupancy especially with the closure of larger-format
tenants like Robinsons. This will be discussed further in
Section 11.
As we move into 2021, we expect a slight recovery in
occupancies as social distancing restrictions ease and
more people return to offices, supporting demand for
retail space from tenants. This will likely be weaker
among Orchard Road shopping centres as tourism is
expected to recover slower than domestic economic
activity.
By 2022, we forecast occupancies for Orchard Road and
suburban shopping centres to recover to pre-COVID-19
levels while shopping centres in the rest of the city area
will likely take longer.
While rents had shown some more positive trends over
the past two years, the COVID-19 pandemic has reversed
these gains and we expect this to continue through 2021,
with recovery only coming in 2022.
Shopping centre owners will be negotiating with
potential tenants in a relatively weak retail market
and may struggle to obtain rents at levels they could
pre-COVID-19. This will be exacerbated once the
Government’s rental relief schemes and moratorium
on non-payment of rent expire at the end of this year,
which could see shopping centre owners needing to offer
rent discounts to attract new tenants and keep their
centres occupied. Orchard Road shopping centres are
likely to face the most challenging environment, with
suburban shopping centres’ higher occupancy limiting
rental decline.
That being said, we are optimistic that the market will
rebalance in the medium-to-long term. Shopping centres
could take the opportunity to re-think their tenant mix
and/or floorspace distribution, especially if larger-format
tenants like department stores or major fashion retailers
vacate. While this may involve lower rents at the start, it
could lead to positive rental reversion if a shopping centre
is able to execute this well.
11. RETAIL TRENDS
This section outlines the major trends that are influencing
the retail market. First, we consider the major trends that
existed prior to the current pandemic. Subsequently, we
look at how the pandemic might change them and how
we see them evolving in the future.
Chart 10.2 Median Retail Rental (Based on Contract Date) YoY Growth
Singapore, 2015 – 2022
Orchard Road
Rest of City Area
Suburban
-1% -1%
-1%
-6%
-7%
-9%
2016
2015
Source: URA, Cistri
Forecast
3%
5%
4%
4%
1%
0.3%
-2% -2%
-0.1%
-3%
-7%
-7%
-1%
-3% -3%
-5%
-6% -6%
2017
2018
2019
2020
2021
2022
Orchard Road • Rest of City Area • Suburban
Contents
4 6 / F R A S E R S C E N T R E P O I N T T R U S T
RETAIL PROPERTY
MARKET OVERVIEW
Broader Market Trends
• Integration of Digital Technologies in Shopping
Centres: Technology is allowing customers to make
much more informed purchases (i.e. research online,
purchase offline), receive faster and on-demand
deliveries, be kept up to date on the latest products
and promotions, and have more cashless payment
options. This has resulted in a relentless drive to create
seamless connectivity between the online and offline
realms. For instance, shopping centre owners have
taken the opportunity to either develop or upgrade
their digital platforms during the COVID-19 pandemic.
For instance, Frasers Property upgraded its multi-
feature mobile app Frasers Experience by improving
customer experience with new features such as digital
gift cards and digital F&B concierge service. The online
F&B concierge service connects users to F&B outlets
in shopping centres managed by Frasers Property and
offers store pick-up and food delivery options.
• Omnichannel Retail: Retailers and shopping centre
owners are now very aware of the need to trade via
omnichannel platforms, especially having experienced
the impact of COVID-19. Research has also shown that
owning a physical footprint in the market provides a
significant benefit to online retailers4. Furthermore,
shopping centres are understanding their potential
to be a central player in the online retail logistics
network. While retailers have often provided click &
collect services, shopping centre owners like Scentre
Group in Australia are starting to do the same on
behalf of their retailers.
• Localisation: Shopping centres are increasingly
functioning as community hubs that are deeply
connected to their local community and environment.
The COVID-19 pandemic is likely to sharpen shoppers’
focus on their local community and they will want
their shopping centres to reflect this. Increasingly,
shoppers will be interested in sourcing local products,
knowing how shopping centres are supporting their
local community, and seeing activities and events
that have a local feel. Further, as e-commerce evolves,
there will be an increasing need for last-mile delivery
infrastructure. This remains a major issue for all
online retailers. Suburban shopping centres have the
potential to play this role as a last-mile fulfilment hub
given their central locations within densely populated
catchments.
• Experiential Retail: The Experience Economy is
transformational in its impact on shopping centres.
We expect to see continued re-allocation of consumer
expenditure from products to experiences. To address
this, shopping centres may need to gradually increase
the amount of space dedicated to experience-focused
tenants (e.g. leisure, entertainment, F&B). There will be
a need for strong placemaking, including high-quality
physical places as well as place activation.
The onset of the COVID-19 pandemic has added a layer
of complexity to the above trends, with social distancing
and spending more time at home becoming more
normalised. We discuss below how this is impacting
consumer behaviour and tenants, and how these are
relevant to shopping centre owners.
Impact of COVID-19 on Consumer behaviour
Probably most discussed in the media are the behavioural
changes driven by COVID-19. While the pandemic will
undoubtedly impact consumers’ behaviours, it remains
to be seen how big this impact will be. In this regard we
make the following points:
Impact of COVID-19 on Online Spending
We do not expect the shift of sales online to be as
dramatic as others may expect for two reasons:
1. Prior to the pandemic, the online shopping industry
in Singapore was relatively small, attracting around
5 – 7% of total retail sales in recent years. As such,
few operators could handle the influx of orders
received from the surge in online shopping during the
pandemic. Thus, the online shopping experience for
many shoppers during this time might have been far
from ideal, given delays in delivery and poor product
return arrangements.
2. Shopping centres in Singapore are places to rejuvenate,
socialise and entertain. Restrictions on movement and
gatherings during Circuit Breaker might have led to a
strong, pent-up desire to visit local shopping centres
once restrictions eased. For instance, FCT had seen
shopper traffic across its portfolio increase by around
70% from the end of Circuit Breaker in mid-June to the
end of the same month.
That said, as omnichannel retail becomes more prevalent
and online shopping platforms are better able to handle
larger volume of orders, we expect that by 2030 online
retail (i.e. at local and overseas online stores) will
constitute 10.5% of total resident spend in Singapore,
close to double that of an estimated 6.4% in 2019.
Impact of COVID-19 on Social Distancing
With shopping centres in Singapore now allowed to be
almost completely open, the impact of social distancing
is not expected to be too long-lasting provided there are
no future forced closures. Footfall for many suburban
shopping centres in China quickly returned to 80%-
90% of pre-COVID-19 levels upon re-opening, a pattern
we have seen in suburban malls in other countries like
Australia, Malaysia, and China. We believe that once
social distancing rules are relaxed, footfall will return to
shopping centres.
Tenant trends
As discussed in Section 6, the impact of the pandemic
varied across product categories and retailers have
responded accordingly. Some have added to their retail
footprint, while several others have departed or will be
departing by end of the year:
4
The Halo Effect: How Bricks Impact Clicks, International Council of Shopping Centres, 2018.
• Amidst brisk sales, supermarket operators such as
Sheng Siong Group and HAO Mart opened at new
locations this year. Sheng Siong Group added five
new supermarkets during the first three quarters of
this year, growing its retail area footprint by 8.6%.
Meanwhile, HAO Mart expanded its in-mall premium
supermarket concept (Eccellente by HAO Mart) to
three other locations – Esplanade Xchange, Marina
Square and Westgate.
• Robinsons announced on 30 October the closure of
its last two stores in Singapore due to changing retail
buying patterns and weak demand which had been
exacerbated by the COVID-19 pandemic. We note that
department stores had been struggling even prior to
the pandemic as they fought to stay relevant amidst
changing consumer preferences and the proliferation
of online retail.
• Notable fashion retailers such as Topshop and Espirit
have closed their stores in Singapore amidst the
pandemic. This came as a result of the streamlining of
their global operations to stay afloat amidst difficult
trading conditions that have been exacerbated by
uncertainties brought about by the pandemic. Fashion
giants H&M and Inditex (owner of several brands
including Zara) have also announced closures of
around 5 – 10% of their stores globally, though it is
unclear how many of their Singapore stores will
be impacted.
Furthermore, some shopping centre owners in Singapore
have indicated that many retailers are requesting to
have their leases changed to only having a turnover-rent
component with no (or very little) base rent. This is a real
challenge to shopping centre owners who are used to
having a great deal of certainty around their income while
the retailer carried the risk of underperformance (and the
reward for outperformance as well).
Even before the pandemic, how rents were being
charged was already in question. The emergence of
omnichannel retail had led to a relook into the role
of physical stores and how they could integrate with
online retail. Some retailers had leveraged their physical
stores as distribution centres via click & collect services
(e.g. Decathlon, Uniqlo). Online orders would either be
packed in warehouses and sent to stores for customers’
collection or fulfilled directly from the stores’ inventories.
Others experimented with using their physical stores as
showcases while processing purchases (even in-store
ones) on their online platforms (e.g. IUIGA, AMORE Store
X Lazada). As this becomes more prevalent, it will become
increasingly important for shopping centre owners to
look for new ways to measure the value of their space
and negotiate lease agreements with retailers that can
better capture the evolving role of a store. For instance,
there could be leases with omnichannel retailers that
include a share of local online sales fulfilled by the store
in the shopping centre, as we have seen in other markets.
A N N U A L R E P O R T 2 0 2 0 / 4 7
12. CONCLUSION
While the Singapore retail market had been facing several
challenges in recent years, none have been quite as acute
as the impact of COVID-19. Retail sales had dipped to
historic lows in May this year and we have seen several
major retailers struggling to ride out the pandemic. That
said, the collective efforts by the Government, landlords
and retailers to keep occupancy as high as it has been,
shows the strength and resilience of the market.
At the same time, it could be said that the pandemic has
helped accelerate the adoption of retail trends that many
retailers and shopping centre owners had been aware
of but did not actively pursue (e.g. omnichannel retail,
digitalisation). In this sense, the pandemic has forced
landlords and retailers to confront these trends head-on.
This has been extremely challenging as the pandemic
has laid bare certain challenges facing physical retail (e.g.
relevance of shopping centres amidst the emergence of
e-commerce) and pushed retailers and shopping centre
owners to address them with urgency. The silver lining
within this is that the pandemic has provided retailers
and landlords an opportunity to build more resilient
businesses for the future.
Beyond COVID-19, we remain optimistic about longer-
term growth in Singapore’s retail market which we
expect to be backed by a return to solid population and
tourism growth, moderate inflation and controlled retail
supply growth.
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Contents
4 8 / F R A S E R S C E N T R E P O I N T T R U S T
RETAIL PROPERTY
MARKET OVERVIEW
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Waterway Point
GLOSSARY & ABBREVIATIONS
ACRA
: Accounting and Corporate Regulatory Authority
CPI
F&B
FCT
GDP
GFA
HDB
MTI
NLA
p.a.
POS
: Consumer Price Inflation
: Food & Beverage
: Frasers Centrepoint Trust
: Gross Domestic Product
: Gross Floor Area
: Housing Development Board
: Ministry of Trade and Industry
: Net Lettable Area
: Per Annum
: Point of Sale
Sales Productivity
: Shopping centre sales per sq.ft of floorspace
SME
SingStat
: Small and Medium-Sized Enterprises
: Singapore Department of Statistics
STB
UK
URA
USA
YoY
: Singapore Tourism Board
: United Kingdom
: Urban Redevelopment Authority
: United States of America
: Year on Year
Contents
5 0 / F R A S E R S C E N T R E P O I N T T R U S T
FCT PORTFOLIO
OVERVIEW
As at 30 September 2020
Causeway Point
Northpoint City
North Wing
Yishun 10
Retail Podium
Waterway Point1
Changi City Point
Bedok Point2
YewTee Point
Anchorpoint
Net lettable area
(NLA)
419,840 square feet
39,004 square meters
219,365 square
feet3
20,380 square
meters
10,344 square
feet
961 square meters
Number of leases
Number of tenants
Title
213
201
167
162
99-year leasehold
commencing 30/10/95
99-year leasehold
commencing 1/4/90
2016
Year purchased
2006
Purchased price
S$606.2 million
Northpoint 1:
2006
Northpoint 2:
2010
Northpoint 1:
S$249.3 million
Northpoint 2:
S$164.6 million
Valuation6
S$1,305.0 million
S$771.5 million
S$35.0 million
39.9%
24.7%
371,382 square feet4
34,503 square meters
202
195
99-year leasehold
commencing 18/5/11
40% interest
purchased in 2019
205,007 square feet5
19,046 square meters
82,713 square feet
7,684 square meters
73,669 square feet
6,844 square meters
71,213 square feet
6,616 square meters
123
118
2014
39
39
2011
60-year leasehold
99-year leasehold
commencing 30/4/09
commencing 15/3/78
99-year leasehold
commencing 3/1/06
71
70
2010
52
51
Freehold
2006
S$37.8 million
S$530.2 million
for 40% interest
S$305.0 million
S$127.0 million
S$125.7 million
S$36.0 million
S$1,300.0 million
(100.0% interest)
S$520.0 million
(40.0% interest)
15.9%
S$338.0 million
S$108.0 million7
S$190.0 million
S$110.0 million
10.3%
5.8%
3.4%
Excludes Bedok Point as it is
earmarked for divestment as
at 30 September 2020.
S$73.24 million
S$44.40 million
S$ 26.21 million9
S$21.73 million
S$5.65 million
S$12.49 million
S$6.87 million
S$52.93 million
S$31.53 million
S$19.50 million10
S$13.10 million
S$2.02 million
S$8.31 million
S$3.00 million
96.6 %
95.0 %
96.0 %
90.4 %
92.0 %
97.1 %
92.7 %
Metro, Courts, Cold Storage
supermarket, Food Republic,
Cathay Cineplexes, Uniqlo
Kopitiam food court, Cold Storage
supermarket, OCBC Bank, United
Overseas Bank, MayBank, McDonald’s
restaurant, Popular bookstore, Sri
Murugan Supermarket, Arnold’s Fried
Chicken, Komala’s @ Yishun 10
NTUC Fairprice, Koufu, Shaw
Theatres, H&M, Cotton On
Singapore
Kopitiam food court,
GymmBoxx, NTUC Club,
NTUC FairPrice, Koufu food
Mr D.I.Y., Koufu food court,
Uniqlo, Nike, Tung Lok and
Tenderbest Makcik Market
court, Watson’s, KFC and
Cotton On, Xin Wang HK
Challenger
lifestyle food outlet
Saizeriya
21.0 million
46.9 million11
19.6 million
9.1 million
3.3 million
10.6 million
Woodlands MRT station
(North-South Line and
Thomson-East Coast Line)
& Bus Interchange
Yishun MRT station (North-South Line)
& Yishun Bus Interchange
Punggol MRT station (North
East Line) and LRT station,
Punggol temporary
bus interchange
Expo MRT station (East-West
Bedok MRT station (East-
YewTee MRT station (North-
Near Queenstown MRT
Line, and Downtown Line 3)
West Line) & Bus Interchange
South Line) & Bus Stop
station (East-West Line)
Café, Sakuraya, Uncle
Leong Signatures seafood
restaurant and Jack’s Place
restaurant
2.4 million
& Bus Stop
As % of total
portfolio appraised
value8
FY2020 Gross
revenue
FY2020 Net
property income
Occupancy
Key tenants
Annual shopper
traffic in FY2020
Connection to
public transport
1
2
3
4
5
6
Frasers Centrepoint Trust owns 40% interest in Sapphire Star Trust (“SST”) which holds the interests in Waterway Point
The Manager announced on 3 September 2020 the divestment of Bedok Point for S$108 million. This transaction was approved by FCT unitholders at an
extraordinary general meeting on 28 September 2020 and the divestment was completed on 9 November 2020
The NLA excludes the area of approximately 10,505 square feet (957.9 square meters) currently used as Community Sports Facilities Scheme (CSFS) space
The NLA excludes the area of approximately 17,954 square feet (1,668 square meters) currently used as CSFS space
The NLA excludes the area of approximately 3,391 square feet (315 square meters) currently used as CSFS space
Based on valuation as at 15 September 2020 for the respective assets
A N N U A L R E P O R T 2 0 2 0 / 5 1
Number of leases
Number of tenants
Title
213
201
99-year leasehold
commencing 30/10/95
99-year leasehold
commencing 1/4/90
Year purchased
2006
Northpoint 1:
2016
20,380 square
961 square meters
meters
167
162
Northpoint 2:
2006
2010
S$249.3 million
Northpoint 2:
S$164.6 million
202
195
99-year leasehold
commencing 18/5/11
40% interest
purchased in 2019
S$530.2 million
for 40% interest
S$1,300.0 million
(100.0% interest)
S$520.0 million
(40.0% interest)
15.9%
Causeway Point
Northpoint City
North Wing
Yishun 10
Retail Podium
Waterway Point1
Changi City Point
Bedok Point2
YewTee Point
Anchorpoint
Net lettable area
419,840 square feet
219,365 square
10,344 square
(NLA)
39,004 square meters
feet3
feet
371,382 square feet4
34,503 square meters
205,007 square feet5
19,046 square meters
82,713 square feet
7,684 square meters
73,669 square feet
6,844 square meters
71,213 square feet
6,616 square meters
123
118
39
39
71
70
60-year leasehold
commencing 30/4/09
99-year leasehold
commencing 15/3/78
99-year leasehold
commencing 3/1/06
2014
2011
2010
52
51
Freehold
2006
Purchased price
S$606.2 million
Northpoint 1:
S$37.8 million
S$305.0 million
S$127.0 million
S$125.7 million
S$36.0 million
Valuation6
S$1,305.0 million
S$771.5 million
S$35.0 million
S$338.0 million
S$108.0 million7
S$190.0 million
S$110.0 million
As % of total
portfolio appraised
value8
FY2020 Gross
revenue
FY2020 Net
property income
Occupancy
Key tenants
Annual shopper
traffic in FY2020
Connection to
public transport
39.9%
24.7%
10.3%
Excludes Bedok Point as it is
earmarked for divestment as
at 30 September 2020.
5.8%
3.4%
S$73.24 million
S$44.40 million
S$ 26.21 million9
S$21.73 million
S$5.65 million
S$12.49 million
S$6.87 million
S$52.93 million
S$31.53 million
S$19.50 million10
S$13.10 million
S$2.02 million
S$8.31 million
S$3.00 million
96.6 %
95.0 %
96.0 %
90.4 %
92.0 %
97.1 %
92.7 %
Metro, Courts, Cold Storage
Kopitiam food court, Cold Storage
NTUC Fairprice, Koufu, Shaw
supermarket, Food Republic,
supermarket, OCBC Bank, United
Theatres, H&M, Cotton On
Cathay Cineplexes, Uniqlo
Overseas Bank, MayBank, McDonald’s
Singapore
Kopitiam food court,
Uniqlo, Nike, Tung Lok and
Challenger
GymmBoxx, NTUC Club,
Tenderbest Makcik Market
lifestyle food outlet
NTUC FairPrice, Koufu food
court, Watson’s, KFC and
Saizeriya
restaurant, Popular bookstore, Sri
Murugan Supermarket, Arnold’s Fried
Chicken, Komala’s @ Yishun 10
Mr D.I.Y., Koufu food court,
Cotton On, Xin Wang HK
Café, Sakuraya, Uncle
Leong Signatures seafood
restaurant and Jack’s Place
restaurant
21.0 million
46.9 million11
19.6 million
9.1 million
3.3 million
10.6 million
2.4 million
Woodlands MRT station
Yishun MRT station (North-South Line)
Punggol MRT station (North
& Yishun Bus Interchange
East Line) and LRT station,
Expo MRT station (East-West
Line, and Downtown Line 3)
Bedok MRT station (East-
West Line) & Bus Interchange
YewTee MRT station (North-
South Line) & Bus Stop
(North-South Line and
Thomson-East Coast Line)
& Bus Interchange
Punggol temporary
bus interchange
Near Queenstown MRT
station (East-West Line)
& Bus Stop
7
Based on the sale price of Bedok Point in the proposed divestment of Bedok Point as announced on 3 September 2020. The sale price was arrived at after
taking into account the independent valuations conducted by Jones Lang LaSalle Property Consultants Pte Ltd (“JLL”) (commissioned by HSBC Institutional
Trust Services (Singapore) Limited (in its capacity as trustee of FCT)) and Colliers International Consultancy & Valuation (Singapore) Pte Ltd (“Colliers”)
(commissioned by the Manager). JLL, in its report dated 1 August 2020, had stated that the open market value of Bedok Point as at 1 August 2020
was S$108.9 million and Colliers, in its report dated 1 August 2020, had stated that the open market value of Bedok Point as at 1 August 2020 was
S$107.2 million
This is FCT’s share of revenue in SST for FY2020
8 Waterway Point’s proportion is based on FCT’s 40% share in SST
9
10 This is FCT’s share of net property income in SST for FY2020
11 Combined shopper traffic for Northpoint City North Wing and South Wing
Contents
5 2 / F R A S E R S C E N T R E P O I N T T R U S T
MALL
PROFILES
Causeway Point
Seven retail levels
(including one basement level)
and seven car park levels
(B2, B3 and 2nd - 6th levels)
Address
1 Woodlands Square,
Singapore 738099
Net Lettable Area
39,004 square meters
(419,840 square feet)
Car Park Lots
835
Title
99-year leasehold
w.e.f 30 Oct 1995
Year Acquired by FCT
2006
Valuation1
S$1,305.0 million
Annual Shopper Traffic
21.0 million
(October 2019 – September 2020)
Key Tenants
Metro, Courts, Cold Storage
supermarket, Food Republic, Cathay
Cineplexes, Uniqlo
Gross Revenue
Property Expenses
Net Property Income
Occupancy
Shopper Traffic (million)
TOP 10 TENANTS
73.24
20.31
52.93
96.6%
21.0
Causeway Point
Causeway Point is the largest mall in Woodlands, one of Singapore’s most
populous residential estates. It is located next to the Woodlands regional
bus interchange and the Woodlands MRT station, which serves as an
interchange station for the existing North-South line and the new Thomson-
East Coast line.
The mall has more than 200 stores and food outlets spread over seven retail
levels (including basement level) and offers shoppers a one-stop shopping and
dining experience.
Causeway Point is an award-winning mall for its user-friendliness, connectivity
and safety aspects in its design and features. The mall is also awarded the
Platinum Award in the BCA’s Green Mark program for its environmentally
friendly features.
MALL PERFORMANCE HIGHLIGHTS
Financial Year ended 30 September
(S$ million)
FY2020
FY2019
Increase/
(Decrease)
(15.3%)
(1.8%)
(19.5%)
86.46
20.69
65.77
97.0%
(0.4%-point)
26.5
(20.8%)
As at 30 September 2020, Causeway Point has a total of 213 leases (FY2019:
199), excluding vacancy. The total number of tenants as at 30 September
2020 was 201 and the key tenants include Metro, Courts, Cold Storage
supermarket, Food Republic, Cathay Cineplexes and Uniqlo, among others.
The top 10 tenants contributed collectively, 37.2% of the mall’s total gross
rental income (“GRI”) (FY2019: 36.3%).
Top 10 Tenants
as at 30 September 2020
Metro (Private) Limited2
Courts (Singapore) Pte. Ltd.
Dairy Farm Group3
BreadTalk Group4
Cathay Cineplexes Pte Ltd
Uniqlo (Singapore) Pte Ltd
Hanbaobao Pte Ltd5
Copitiam Pte Ltd6
Lee Hwa Group7
R E & S Group
Total
% of Mall’s GRI
8.2%
6.8%
5.4%
4.9%
3.1%
2.2%
1.9%
1.6%
1.6%
1.5%
37.2%
A N N U A L R E P O R T 2 0 2 0 / 5 3
TRADE SECTOR ANALYSIS
Food & Beverage contributed 31.0%, (FY2019: 29.7%) of the mall’s GRI, followed by the Fashion trade at 12.6%
(FY2019: 14.7%, which included Jewellery & Watches) and Household at 12.6% (FY2019: 10.4%). These three trades
account for 56.2% of the mall’s GRI. The breakdown of the trade sector analysis by NLA and GRI is presented below.
Trade Classifications
(in descending order of % rent)
By NLA
By GRI8
1
2
3
4
5
6
7
8
9
10
11
12
13
Food & Beverage
Fashion
Household
Beauty & Health
Department Store
Services
Jewellery & Watches
Supermarket & Hypermarket
Leisure/Entertainment
Books, Music, Art & Craft, Hobbies
Sports Apparel & Equipment
Education
Vacant
Total
LEASE EXPIRY PROFILE9
23.1%
12.3%
12.9%
7.4%
14.3%
3.8%
1.3%
5.8%
9.2%
3.6%
1.9%
1.0%
3.4%
31.0%
12.6%
12.6%
11.6%
8.1%
6.3%
4.1%
3.9%
3.8%
2.6%
2.6%
0.8%
0.0%
100.0%
100.0%
As at 30 September 2020
FY2021
FY2022
FY2023
FY2024
FY2025
Total
Number of leases expiring
78
67
65
NLA of expiring leases (square feet)
98,007
170,593
130,417
Expiries as % of Mall’s total leased area
Contribution of expiring leases as %
of Mall’s total GRI
24.2%
30.0%
42.1%
34.4%
32.1%
34.6%
2
5,135
1.3%
0.6%
1
213
1,364
405,516
0.3%
0.4%
100.0%
100.0%
Includes leases for Metro Department Store & Clinique Service Centre
Includes leases for Cold Storage supermarket, Guardian Pharmacy and 7-Eleven stores
Includes leases from Food Republic, BreadTalk and Toast Box
1 Valuation done by Savills Valuation and Professional Services (S) Pte Ltd as at 15 September 2020
2
3
4
5 Operator of McDonald’s Restaurants Pte Ltd
6 Operator of Kopitiam food court
7
8
9
Includes leases for Lee Hwa Jewellery and Goldheart Jewellery
Excludes gross turnover rent
Excludes vacancy
Contents
5 4 / F R A S E R S C E N T R E P O I N T T R U S T
MALL
PROFILES
Northpoint City North Wing
Six retail levels
(including two basement levels)
and three levels of car park (B1 - B3)
Address
930 Yishun Avenue 2,
Northpoint, Singapore 769098
Net Lettable Area1
20,380 square meters
(219,365 square feet)
Car Park Lots
157
Title
99-year leasehold
w.e.f 1 Apr 1990
Year Acquired by FCT
2006 (Northpoint 1),
2010 (Northpoint 2)
Valuation2
S$771.5 million
as at 30 September 2020
Annual Shopper Traffic
46.9 million3
(October 2019 – September 2020)
Key Tenants
Kopitiam food court, Cold Storage
supermarket, OCBC Bank, United
Overseas Bank, MayBank, McDonald’s
restaurant and Popular bookstore
Yishun 10 Retail Podium
10 retail units on the first storey in
a cinema complex with basement
carpark
Address
51 Yishun Central 1, Yishun 10,
Singapore 768794
Net Lettable Area
961 square meters
(10,344 square feet)
Title
99-year leasehold
w.e.f 1 Apr 1990
Year Acquired by FCT
2016
Valuation4
S$35.0 million
Key Tenants
Sri Murugan Supermarket, Arnold’s
Fried Chicken, Komala’s @ Yishun 10
Northpoint City North Wing
and Yishun 10 Retail Podium
Northpoint City North Wing is FCT’s second largest property by net lettable
area (“NLA”) after Causeway Point. It is seamlessly integrated with the
Northpoint City South Wing (owned by FCT’s sponsor, Frasers Property
Limited) to form Northpoint City, with over 400 F&B and retailers spread over
500,000 square feet of space.
Northpoint City North Wing offers six retail levels of shopping (including two
basement levels). Key tenants at Northpoint City North Wing include Kopitiam
food court, Cold Storage supermarket, OCBC Bank, United Overseas Bank,
MayBank, McDonald’s restaurant and Popular bookstore. The mall enjoys high
shopper traffic flow from the surrounding residential estate, schools and the
commuters from Yishun bus interchange which is connected to the mall.
FCT also owns ten strata-titled retail units in the Yishun 10 retail podium
located next to Northpoint City North Wing.
MALL PERFORMANCE HIGHLIGHTS
Financial Year ended 30 September
(S$ million)
FY2020
FY2019
Gross Revenue
Property Expenses
Net Property Income
Occupancy
Shopper Traffic (million)
44.40
12.87
31.53
95.0%
46.9
Increase/
(Decrease)
(16.4%)
(7.3%)
(19.6%)
53.09
13.88
39.21
99.0%
(4.0%-point)
57.3
(18.2%)
TOP 10 TENANTS (Northpoint City North Wing and Yishun 10 retail podium)
As at 30 September 2020, Northpoint City North Wing and Yishun 10 retail
podium has a total of 167 leases (FY2019: 184). The total number of tenants
as at 30 September 2020 was 162 and the key tenants include Kopitiam
food court, Cold Storage supermarket, OCBC Bank, United Overseas Bank,
MayBank, Soo Kee Jewellery, Cotton On, McDonald’s restaurant and Popular
bookstore, among others. The top 10 tenants contributed collectively 30.3%
of the total gross rental income (“GRI”) (FY2019: 26.9%).
Top 10 Tenants
as at 30 September 2020
Copitiam Pte Ltd5
Dairy Farm Group6
Overseas-Chinese Banking Corporation Ltd
United Overseas Bank Ltd
Malayan Banking Berhad
Soo Kee Group
Cotton On Group
Hanbaobao Pte Ltd7
Popular Group
BreadTalk Group
Total
% of Mall’s GRI
6.9%
6.0%
3.3%
2.8%
2.3%
2.1%
1.9%
1.8%
1.7%
1.5%
30.3%
A N N U A L R E P O R T 2 0 2 0 / 5 5
TRADE SECTOR ANALYSIS (Northpoint City North Wing and Yishun 10 podium)
Food & Beverage contributed 41.0%, (FY2019: 42.5%) of the mall’s gross rental income, followed by the Beauty &
Health trade at 12.9% (FY2019: 12.3%) and Services trade at 12.9% (FY2019: 12.2%). These three trades account for
66.8% of the mall’s GRI. The breakdown of the trade sector analysis by NLA and GRI is presented below.
Trade Classifications
(in descending order of % rent)
1
2
3
4
5
6
7
8
9
10
11
12
Food & Beverage
Beauty & Health
Services
Fashion
Supermarket & Hypermarket
Books, Music, Art & Craft, Hobbies
Jewellery & Watches
Household
Sports Apparel & Equipment
Education
Leisure/Entertainment
Vacant
Total
LEASE EXPIRY PROFILE9
By NLA
By GRI8
34.7%
9.8%
6.6%
9.0%
9.1%
6.5%
1.4%
2.9%
2.2%
10.7%
2.1%
5.0%
100.0%
41.0%
12.9%
12.9%
11.5%
5.5%
4.4%
3.5%
2.6%
2.4%
2.2%
1.1%
0.0%
100.0%
As at 30 September 2020
FY2021
FY2022
FY2023
FY2024
>FY2026
Total
Number of leases expiring
72
41
48
5
1
167
NLA of expiring leases (square feet)
73,394
55,515
42,253
25,798
21,248
218,208
Expiries as % of Mall’s total leased area
Contribution of expiring leases as %
of Mall’s total GRI
33.6%
34.5%
25.5%
25.7%
19.4%
28.3%
11.8%
10.3%
9.7%
1.2%
100.0%
100.0%
The NLA excludes the area of approximately 10,505 square feet (957.9 square meters) currently used as Community Sports Facilities Scheme (CSFS) space
Refers to the total shopper traffic for both Northpoint City North Wing (owned by FCT) and South Wing (owned by Frasers Property Limited)
1
2 Valuation done by Colliers International Consultancy & Valuation (Singapore) Pte Ltd as at 15 September 2020
3
4 Valuation done by Savills Valuation and Professional Services (S) Pte Ltd as at 15 September 2020
5 Operator of Kopitiam food court
6
7 Operator of McDonald’s Restaurant
8
9
Excludes gross turnover rent
Excludes vacancy, for both Northpoint City North Wing and Yishun 10 Retail Podium
Includes leases for Cold Storage supermarket, Guardian Pharmacy and 7-Eleven stores
Contents
5 6 / F R A S E R S C E N T R E P O I N T T R U S T
MALL
PROFILES
Waterway Point
4-storey suburban family
and lifestyle shopping mall
(including two basement levels)
Address
83 Punggol Central,
Singapore 828761
Net Lettable Area (“NLA”)2
34,503 square meters
(371,382 square feet)
Car Park Lots
622
Title
99-year leasehold
commencing 18 May 2011
Year Acquired by FCT
FCT owns 40.0% stake in Waterway
Point, the dates of acquisition are as
follow:
• 331/3% acquired on 11 July 2019
• 62/3% acquired on 18 September
2019
Valuation3
S$1,300 million
Annual Shopper Traffic
19.6 million
(October 2019 – September 2020)
Key Tenants
NTUC Fairprice, Koufu, Shaw Theatres,
H&M, Cotton On Singapore
Waterway Point
Waterway Point is a 4-storey suburban family and lifestyle shopping mall
located at 83 Punggol Central, Singapore 828761, the heart of Singapore’s
first waterfront eco-town, Punggol. The mall enjoys direct connection to
public transportation system including the Punggol MRT & LRT stations and a
temporary bus interchange. It is also served by major expressways including
Tampines Expressway (TPE) and Seletar Expressway (SLE) which provide
vehicular accessibility to other parts of Singapore.
The mall offers its shoppers a diverse range of shopping, dining and
entertainment experiences and caters to their necessity and convenience
shopping as well as their leisure needs. Notable retailers and restaurant
operators at the mall include Uniqlo, Daiso Japan, Din Tai Fung, H&M and a
24-hour NTUC FairPrice Finest supermarket. It also offers a wide range of food
and dining outlets including some with alfresco options. The mall also has a
cineplex operated by Shaw Theatres that features 10 screens, including an
IMAX theatre.
FCT holds a 40.0% share in Sapphire Star Trust (“SST”). SST is a private trust
that holds the interest in Waterway Point.
Waterway Point is awarded the BCA Universal Design (UD) GoldPlus and the BCA
Green Mark GoldPlus1 certifications.
MALL PERFORMANCE HIGHLIGHTS
FCT’s share for the period
(S$ million)
1 October 2019 –
30 September 2020 (FY2020)
12 July 20194 –
30 September 2019
Gross Revenue
Net Property Income
Occupancy
Shopper Traffic (million)
TOP 10 TENANTS
26.21
19.50
96.0%
19.6
5.72
4.48
98.0%
28.4
As at 30 September 2020, Waterway Point has a total of 202 leases (FY2019:
203), excluding vacancy. The total number of tenants as at 30 September
2020 was 195 and the key tenants include Koufu foodcourt, Shaw Theatres,
H&M and a 24-hour NTUC FairPrice Finest supermarket, among others. The
top 10 tenants contributed collectively, 29.4% (FY2019: 28.7%) of the mall’s
total gross rental income (“GRI”).
Top 10 Tenants
as at 30 September 2020
NTUC5
Koufu Pte Ltd
Shaw Theatres Pte Ltd
H&M Hennes & Mauritz Pte Ltd
Cotton On Singapore Pte Ltd6
BreadTalk Group
Citibank Singapore Limited
Yum!
Best Denki (Singapore) Pte Ltd
United Overseas Bank Limited
Total
% of Mall’s GRI
6.9%
4.3%
3.4%
3.3%
2.6%
1.9%
1.8%
1.8%
1.8%
1.6%
29.4%
A N N U A L R E P O R T 2 0 2 0 / 5 7
TRADE SECTOR ANALYSIS
Food & Beverage contributed 35.9% (FY2019: 34.9%) of the mall’s GRI, followed by the Fashion trade at 15.2% (FY2019:
17.2%). These two trades account for 51.1% of the mall’s gross rental income. The breakdown of the trade sector
analysis by NLA and GRI is presented below.
Trade Classifications
(in descending order of % rent)
By NLA
By GRI7
1
2
3
4
5
6
7
8
9
10
11
12
Food & Beverage
Fashion
Beauty & Health
Services
Household
Supermarket & Hypermarket
Leisure/Entertainment
Books, Music, Art & Craft, Hobbies
Education
Jewellery & Watches
Sports Apparel & Equipment
Vacant
Total
LEASE EXPIRY PROFILE8
27.5%
17.2%
7.5%
6.6%
8.9%
8.0%
9.6%
6.1%
3.3%
0.8%
0.5%
4.0%
35.9%
15.2%
12.0%
11.3%
6.5%
6.5%
3.9%
3.6%
2.7%
1.6%
0.8%
0.0%
100.0%
100.0%
As at 30 September 2020
FY2021
FY2022
FY2023
FY2024
Total
Number of leases expiring
53
93
NLA of expiring leases (square feet)
110,275
149,386
Expiries as % of Mall’s total leased area
Contribution of expiring leases as %
of Mall’s total GRI
30.9%
29.5%
41.9%
39.1%
43
54,482
15.3%
19.0%
13
42,502
11.9%
12.4%
202
356,645
100.0%
100.0%
In the process of re-certification as the current green mark certification has expired
The NLA excludes the area of approximately 17,954 square feet (1,668 square meters) currently used as Community Sports Facilities Scheme (CSFS) space
1
2
3 Valuation done by Jones Lang LaSalle Property Consultants Pte Ltd as at 15 September 2020. The NLA excludes the area of approximately
17,954 square feet currently used as Community Sports Facilities Scheme (CSFS) space
FCT acquired the initial 331/3% stake in SST on 11 July 2019
4
5 Operates FairPrice Finest and NTUC Healthcare (Unity)
6
7
8
Includes leases for Cotton On, Cotton On Kids and TYPO
Excludes gross turnover rent
Excludes vacancy
Contents
5 8 / F R A S E R S C E N T R E P O I N T T R U S T
MALL
PROFILES
Changi City Point
Three retail levels
(including one basement level)
Address
5 Changi Business Park Central 1,
Changi City Point,
Singapore 486038
Net Lettable Area (“NLA”)1
19,046 square meters
(205,007 square feet)
Car Park Lots
6272
Title
60-year leasehold
w.e.f 30 Apr 2009
Year Acquired by FCT
2014
Valuation3
S$338.0 million
Annual Shopper Traffic
9.1 million
(October 2019 – September 2020)
Key Tenants
Kopitiam food court, Uniqlo, Nike,
Tung Lok and Challenger
Changi City Point
Changi City Point is a three-storey retail mall (with one basement level)
located in Changi Business Park, next to the Singapore Expo MRT station
and near one of Singapore’s largest convention and exhibition venues, The
Singapore Expo. Changi City Point is the third largest by net lettable area
among Frasers Centrepoint Trust’s portfolio.
The mall offers diverse shopping and dining experience especially for the
working population in Changi Business Park; residents in nearby precincts such
as Tampines, Bedok and Simei; and the visitors to the Singapore Expo. Changi
City Point features fashion and sports retailers including Uniqlo, Nike Factory
Store, Timberland, Adidas, Asics Factory Outlet, New Balance, Puma Outlet,
Liv Activ and many other outlets stores.
Shoppers can also do their grocery shopping at the NTUC Finest supermarket.
The restaurants at the mall include Tung Lok Signatures, Jollibee, Ichiban
Sushi, Han’s and the Kopitiam food court. Families can also enjoy the
landscaped rooftop garden that also features a wet and dry children’s
playground.
MALL PERFORMANCE HIGHLIGHTS
Financial Year ended 30 September
(S$ million)
FY2020
FY2019
Gross Revenue
Property Expenses
Net Property Income
Occupancy
Shopper Traffic (million)
TOP 10 TENANTS
21.73
8.63
13.10
90.4%
9.1
Increase/
(Decrease)
(20.5%)
(12.0%)
(25.3%)
27.34
9.81
17.53
95.9%
(5.5%-point)
13.9
(34.5%)
As at 30 September 2020, Changi City Point has a total of 123 leases
(FY2019: 129), excluding vacancy. The total number of tenants as at 30
September 2020 was 1184 and the key tenants include Kopitiam food court,
Nike, Tung Lok, Challenger and Uniqlo, among others. The top 10 tenants
contributed collectively 31.9% of the mall’s total gross rental income (“GRI”)
(FY2019: 27.1%).
Top 10 Tenants
as at 30 September 2020
Copitiam Pte Ltd5
Bachmann Japanese Restaurant Pte Ltd
NIKE Global Trading B.V.
Tung Lok Signature (2006) Pte Ltd
Challenger Group
RE & S Group6
Uniqlo (Singapore) Pte Ltd
Daiso Singapore Pte. Ltd.
Golden Beeworks7
Ootoya Asia Pacific Pte. Ltd
Wing Tai Group
Total
% of Mall’s GRI
9.5%
2.6%
2.4%
2.2%
2.1%
2.1%
3.3%
2.0%
2.0%
1.9%
1.8%
31.9%
A N N U A L R E P O R T 2 0 2 0 / 5 9
TRADE SECTOR ANALYSIS
Food & Beverage contributed 55.7%, (FY2019: 53.6%) of the mall’s GRI, followed by the Fashion trade at 18.3%
(FY2019: 20.9%). These two trades account for 74.0% of the mall’s GRI. The breakdown of the trade sector analysis by
NLA and GRI is presented below.
Trade Classifications
(in descending order of % rent)
1
2
3
4
5
6
7
8
9
Food & Beverage
Fashion
Sports Apparel & Equipment
Household
Beauty & Health
Services
Supermarket & Hypermarket
Leisure/Entertainment
Vacant
Total
LEASE EXPIRY PROFILE9
By NLA
By GRI8
38.8%
17.7%
13.2%
8.5%
3.6%
2.0%
6.4%
0.2%
9.6%
55.7%
18.3%
10.5%
5.8%
5.1%
2.6%
1.9%
0.1%
0.0%
100.0%
100.0%
As at 30 September 2020
FY2021
FY2022
FY2023
FY2024
Total
Number of leases expiring
NLA of expiring leases (square feet)
Expiries as % of Mall’s total leased area
Contribution of expiring leases as %
of Mall’s total GRI
62
84,341
45.5%
43.8%
36
61,850
33.4%
35.1%
24
38,385
20.7%
20.8%
1
850
0.4%
0.3%
123
185,426
100.0%
100.0%
Excluding tenants under the Community and Sports Facilities scheme (CSFS)
The NLA excludes the area of approximately 3,391 square feet (315 square meters) currently used as Community Sports Facilities Scheme (CSFS) space
1
2
The car park lots are shared between Changi City Point, Capri By Fraser and ONE@Changi City
3 Valuation done by Savills Valuation and Professional Services (S) Pte Ltd as at 15 September 2020
4
5 Operator of Kopitiam food court
6 Operates the Ichiban Sushi restaurant at Changi City Point
7 Operates the Jollibee restaurant at Changi City Point
8
9
Excludes gross turnover rent
Excludes vacancy
Contents
6 0 / F R A S E R S C E N T R E P O I N T T R U S T
MALL
PROFILES
Bedok Point
Five retail levels
(including one basement level)
and one basement car park
Address
799 New Upper Changi Road,
Singapore 467351
Net Lettable Area
7,684 square meters
(82,713 square feet)
Car Park Lots
76
Title
99-year leasehold
w.e.f 15 March 1978
Year Acquired by FCT
2011
Valuation1
S$108.0 million
Annual Shopper Traffic
3.3 million
(October 2019 – September 2020)
Key Tenants
GymmBoxx, NTUC Club and
Tenderbest Makcik Market lifestyle
food outlet
Bedok Point
Bedok Point has five retail levels (including one basement level) and one
basement car park. The mall is located in the town centre of Bedok, which is
one of the largest residential estates in Singapore by population. The mall is
well-served by the nearby Bedok MRT station and the Bedok bus interchange.
The key tenants at Bedok Point include GymmBoxx, Happy Days (NTUC Club),
and Tenderbest Makcik Market (a lifestyle food outlet), among others.
The Manager announced on 3 September 2020 the divestment of Bedok Point
for S$108 million. This transaction was approved by FCT unitholders at an
extraordinary general meeting on 28 September 2020 and the divestment
was completed on 9 November 2020.
MALL PERFORMANCE HIGHLIGHTS
Financial Year ended 30 September
(S$ million)
FY2020
FY2019
Gross Revenue
Property Expenses
Net Property Income
Occupancy
Shopper Traffic (million)
TOP 10 TENANTS
5.65
3.63
2.02
92.0%
3.3
Increase/
(Decrease)
(13.2%)
(5.5%)
(24.1%)
6.51
3.84
2.66
95.7%
(3.7%-point)
4.2
(21.4%)
As at 30 September 2020, Bedok Point has a total of 39 leases (FY2019: 40),
excluding vacancy. The total number of tenants as at 30 September 2020 was
39 and the key tenants include GymmBoxx, NTUC Club, Tenderbest Makcik
Market, among others. The top 10 tenants contributed collectively, 49.3% of
the mall’s total gross rental income (“GRI”) (FY2019: 50.1%).
Top 10 Tenants
as at 30 September 2020
% of Mall’s GRI
Gymmboxx Pte Ltd
NTUC Club
Tenderfresh Fresh Group2
D&N Singapore Pte Ltd3
QM Jianghu Pte Ltd
Zensho Food Singapore Pte Ltd4
Chicken Hotpot (S) Pte. Ltd.
Singapore Saizeriya Pte Ltd
Teo Heng KTV Pte Ltd
AGB Education Centre Pte Ltd
Total
8.7%
7.3%
5.2%
5.1%
4.7%
4.0%
3.8%
3.6%
3.5%
3.4%
49.3%
A N N U A L R E P O R T 2 0 2 0 / 6 1
TRADE SECTOR ANALYSIS
Food & Beverage contributed 42.5%, (FY2019: 41.0%) of the mall’s GRI, followed by Beauty & Health at 22.4% (FY2019:
13.4%). These two trades account for 64.9% of the mall’s GRI. The breakdown of the trade sector analysis by NLA and
GRI is presented below.
Trade Classifications
(in descending order of % rent)
1
2
3
4
5
6
7
8
Food & Beverage
Beauty & Health
Leisure/Entertainment
Education
Household
Services
Fashion
Vacant
Total
LEASE EXPIRY PROFILE6
By NLA
By GRI5
30.0%
16.9%
14.2%
9.4%
18.3%
2.3%
0.9%
8.0%
42.5%
22.4%
14.7%
11.9%
3.3%
3.1%
2.1%
0.0%
100.0%
100.0%
As at 30 September 2020
FY2021
FY2022
FY2023
Total
Number of leases expiring
NLA of expiring leases (square feet)
Expiries as % of Mall’s total leased area
Contribution of expiring leases as % of
Mall’s total GRI
16
25,084
33.0%
43.4%
16
32,848
43.1%
46.3%
7
18,169
23.9%
10.3%
39
76,101
100.0%
100.0%
1
Based on the sale price of Bedok Point in the proposed divestment of Bedok Point as announced on 3 September 2020. The sale price was arrived at after
taking into account the independent valuations conducted by Jones Lang LaSalle Property Consultants Pte Ltd (“JLL”) (commissioned by HSBC Institutional
Trust Services (Singapore) Limited (in its capacity as trustee of FCT)) and Colliers International Consultancy & Valuation (Singapore) Pte Ltd (“Colliers”)
(commissioned by the Manager). JLL, in its report dated 1 August 2020, had stated that the open market value of Bedok Point as at 1 August 2020
was S$108.9 million and Colliers, in its report dated 1 August 2020, had stated that the open market value of Bedok Point as at 1 August 2020 was
S$107.2 million
2 Operator of Tenderbest Makcik Market at Bedok Point
3 Operator of Hoshino cafe at Bedok Point
4 Operator of Long John Silver fast food restaurant at Bedok Point
5
6
Excludes gross turnover rent
Exclude vacancy
Contents
6 2 / F R A S E R S C E N T R E P O I N T T R U S T
MALL
PROFILES
YewTee Point
Two retail levels
(including one basement level)
and one basement car park
Address
21 Choa Chu Kang North 6,
Singapore 689578
Net Lettable Area
6,844 square meters
(73,669 square feet)
Car Park Lots
831
Title
99-year leasehold
w.e.f 3 Jan 2006
Year Acquired by FCT
2010
Valuation2
S$190.0 million
Annual Shopper Traffic
10.6 million
(October 2019 – September 2020)
Key Tenants
NTUC FairPrice, Koufu food court,
Watson’s, KFC and Saizeriya
YewTee Point
YewTee Point has two retail levels (including one basement level). The mall is
located in Yew Tee, a housing estate within a major residential precinct Choa
Chu Kang, northwest of Singapore. YewTee Point is served by the adjacent
YewTee MRT station and public bus services.
YewTee Point’s key tenants include NTUC FairPrice, Koufu food court,
Watson’s, KFC and Saizeraya, among others. It draws shoppers from the
private apartments located above the mall (YewTee Residences), the YewTee
housing estate, schools, military camp and the nearby industrial estate.
MALL PERFORMANCE HIGHLIGHTS
Financial Year ended 30 September
(S$ million)
FY2020
FY2019
Gross Revenue
Property Expenses
Net Property Income
Occupancy
Shopper Traffic (million)
TOP 10 TENANTS
12.49
4.18
8.31
97.1%
10.6
14.44
4.13
10.31
97.1%
13.0
Increase/
(Decrease)
(13.5%)
1.2%
(19.4%)
No change
(18.5%)
As at 30 September 2020, YewTee Point has a total of 71 leases (FY2019: 66),
excluding vacancy. The total number of tenants as at 30 September 2020 was
70 and the key tenants include NTUC FairPrice, Koufu food court, Watson’s,
KFC and Saizeriya, among others. The top 10 tenants contributed collectively,
50.3% of the mall’s total gross rental income (“GRI”) (FY2019: 50.7%).
Top 10 Tenants
as at 30 September 2020
% of Mall’s GRI
NTUC FairPrice Co-operative Ltd3
Koufu Group4
Watson's Personal Care Stores Pte Ltd
Yum!5
Singapore Saizeriya Pte Ltd
West Co'z Café Ptd Ltd
Zensho Food Singapore Pte Ltd6
BreadTalk Pte Ltd7
Sushi Express Group
Fei Siong Group8
Total
19.7%
10.5%
3.8%
3.7%
2.4%
2.2%
2.1%
2.0%
2.0%
1.9%
50.3%
A N N U A L R E P O R T 2 0 2 0 / 6 3
TRADE SECTOR ANALYSIS
Food & Beverage contributed 46.7%, (FY2019: 45.4%) of the mall’s GRI, followed by the Beauty & Health trade at 19.4%
(FY2019: 23.0%). These two trades account for 66.1% of the mall’s GRI. The breakdown of the trade sector analysis by
NLA and GRI is presented below.
Trade Classifications
(in descending order of % rent)
1
2
3
4
5
6
7
8
9
Food & Beverage
Beauty & Health
Supermarket & Hypermarket
Household
Services
Fashion
Education
Books, Music, Art & Craft, Hobbies
Leisure/Entertainment
10
Vacant
Total
LEASE EXPIRY PROFILE10
By NLA
By GRI9
43.7%
15.1%
23.5%
3.6%
2.5%
2.0%
2.9%
1.8%
2.0%
2.9%
46.7%
19.4%
18.2%
4.2%
2.9%
2.8%
2.4%
1.8%
1.6%
0.0%
100.0%
100.0%
As at 30 September 2020
FY2021
FY2022
FY2023
FY2024
Total
Number of leases expiring
NLA of expiring leases (square feet)
Expiries as % of Mall’s total leased area
Contribution of expiring leases as %
of Mall’s total GRI
36
22,238
31.1%
36.3%
17
12,635
17.7%
20.0%
17
28,128
39.3%
33.2%
1
8,547
11.9%
10.5%
71
71,548
100.0%
100.0%
Part of limited common property for the exclusive benefit of YewTee Point
Includes leases for NTUC Fairprice and NTUC Healthcare (Unity)
1
2 Valuation done by CBRE Pte Ltd as at 15 September 2020
3
4 Operator of Koufu food court
5 Operator of Kentucky Fried Chicken restaurant
6 Operator of Long John Silver’s
7 Operator of ToastBox
8 Operator of Encik Tan F&B outlets
9
Excludes gross turnover rent
10 Excludes vacancy
Contents
6 4 / F R A S E R S C E N T R E P O I N T T R U S T
MALL
PROFILES
Anchorpoint
Two retail levels
(including one basement level)
and an adjacent two-storey
restaurant building
Address
368 and 370 Alexandra Road,
Singapore 159952/159953
Net Lettable Area
6,616 square meters
(71,213 square feet)
Car Park Lots
1281
Title
Freehold
Year Acquired by FCT
2006
Valuation2
S$110.0 million
Annual Shopper Traffic
2.4 million
(October 2019 – September 2020)
Key Tenants
Mr D.I.Y., Koufu food court, Cotton On,
Xin Wang HK Café, Sakuraya, Uncle
Leong Signatures seafood restaurant
and Jack’s Place restaurant
Gross Revenue
Property Expenses
Net Property Income
Occupancy
Shopper Traffic (million)
TOP 10 TENANTS
6.87
3.88
3.00
92.7%
2.4
Anchorpoint
Anchorpoint has two retail levels (including one basement level) and an
adjacent 2-storey restaurant building. The mall is located along Alexandra
Road, opposite to the popular large home furnishing store IKEA and Park
Hotel Alexandra. Anchorpoint is well-served by public bus services as well as
scheduled shuttle bus service between the mall and the nearby offices in the
Alexandra area.
Anchorpoint offers an exciting range of eateries and restaurants, retail
shopping and boutique outlets. The stores and restaurants at Anchorpoint
include Mr D.I.Y., Koufu food court, Cotton On, Xin Wang HK Café, Sakuraya,
Uncle Leong Signatures seafood restaurant and Jack’s Place restaurant.
Anchorpoint was awarded the Singapore Service Class Award (2012 – 2015)
by Spring Singapore.
MALL PERFORMANCE HIGHLIGHTS
Financial Year ended 30 September
(S$ million)
FY2020
FY2019
Increase/
(Decrease)
(19.7%)
(18.3%)
(21.3%)
8.56
4.75
3.81
79.0%
13.7%-point
3.2
(25.0%)
As at 30 September 2020, Anchorpoint has a total of 52 leases (FY2019: 53),
excluding vacancy. The total number of tenants as at 30 September 2020 was
51 and the key tenants include: household retailer Mr D.I.Y.; Koufu food court;
fashion retailer Cotton On; Xin Wang HK Café; Sakuraya Japanese restaurant;
Uncle Leong Signatures seafood restaurant; and Jack’s Place restaurant. The
top 10 tenants contributed collectively, 56.4% of the mall’s total gross rental
income (“GRI”) (FY2019: 51.1%).
Top 10 Tenants
as at 30 September 2020
Mr D.I.Y Trading (Singapore)
Koufu Group
Cotton On Group
XWS Pte Ltd3
Sakuraya Foods Pte Ltd
Crab Empire Pte Ltd4
JP Food Service Pte Ltd5
Watson's Personal Care Stores Pte Ltd
Sarika Connoisseur Cafe Pte Ltd6
Charles & Keith (Singapore) Pte Ltd
Total
% of Mall’s GRI
13.4%
7.9%
5.9%
5.2%
4.8%
4.5%
4.3%
3.7%
3.6%
3.1%
56.4%
A N N U A L R E P O R T 2 0 2 0 / 6 5
TRADE SECTOR ANALYSIS
Food & Beverage contributed 48.0%, (FY2019: 50.6%) of the mall’s GRI, followed by the Household trade at 18.1%
(FY2019: 5.5%). These two trades account for 66.1% of the mall’s GRI. The breakdown of the trade sector analysis by
NLA and GRI is presented below.
Trade Classifications
(in descending order of % rent)
By NLA
By GRI7
1
2
3
4
5
6
7
8
9
Food & Beverage
Household
Fashion
Beauty & Health
Education
Services
Leisure/Entertainment
Books, Music, Art & Craft, Hobbies
Vacant
Total
LEASE EXPIRY PROFILE8
41.4%
20.2%
13.5%
8.6%
5.0%
3.0%
0.7%
0.3%
7.3%
48.0%
18.1%
12.5%
12.1%
4.1%
4.0%
0.6%
0.6%
0.0%
100.0%
100.0%
As at 30 September 2020
FY2021
FY2022
FY2023
FY2024
Total
Number of leases expiring
NLA of expiring leases (square feet)
Expiries as % of Mall’s total leased area
Contribution of expiring leases as %
of Mall’s total GRI
24
20,522
31.1%
31.1%
16
22,517
34.1%
32.9%
11
21,619
32.8%
34.5%
1
1,335
2.0%
1.5%
52
65,993
100.0%
100.0%
1
Located at Anchorpoint but are part of a common property of strata sub-divided mixed-use development, which comprises Anchorpoint and The
Anchorage (a condominium), managed by the MCST Title Plan No.2304
2 Valuation done by Colliers International Consultancy & Valuation (Singapore) Pte Ltd as at 15 September 2020
3 Operator of Xin Wang HK Café at Anchorpoint
4 Operator of Uncle Leong Signatures at Anchorpoint
5 Operator of Jack’s Place Restaurant at Anchorpoint
6 Operator of The Coffee Connoisseur at Anchorpoint
7
8
Excludes gross turnover rent
Excludes vacancy
Contents
6 6 / F R A S E R S C E N T R E P O I N T T R U S T
MALL
DIRECTORY
Anchorpoint
Bedok Point1
368 and 370 Alexandra Road,
Singapore 159952/159953
799 New Upper Changi Road,
Singapore 467351
(65) 6475 2257
(65) 6481 1353
Causeway Point
1 Woodlands Square,
Singapore 738099
(65) 6894 2237
www.anchorpoint.com.sg
www.bedokpoint.com.sg
www.causewaypoint.com.sg
Century Square3
2 Tampines Central 5
Singapore 529509
(65) 6789 6261
Changi City Point
Hougang Mall3
5 Changi Business Park Central 1,
Singapore 486038
90 Hougang Avenue 10
Singapore 538766
(65) 6511 1088
(65) 6488 9617
www.centurysquare.com.sg
www.changicitypoint.com.sg
www.hougangmall.com.sg
Northpoint City North Wing
930 Yishun Avenue 2,
Singapore 769098
Yishun 10 Retail Podium
51 Yishun Central 1, Yishun 10,
Singapore 768794
(65) 6754 2300
www.northpointcity.com.sg
Tampines 13
10 Tampines Central 1
Singapore 529536
(65) 6572 5522
Tiong Bahru Plaza3
298 Tiong Bahru Road,
Singapore 168730
(65) 6276 4686
www.tampines1.com.sg
www.tiongbahruplaza.com.sg
Waterway Point2
83 Punggol Central
Singapore 828761
(65) 6812 7300
White Sands3
YewTee Point
1 Pasir Ris Central Street 3,
Singapore 518457
21 Choa Chu Kang North 6
Singapore 689578
(65) 6585 0606
(65) 6465 1986
www.waterwaypoint.com.sg
www.whitesands.com.sg
www.yewteepoint.com.sg
1 Divestment of Bedok Point was completed on 9 November 2020
2
3 Originally part of AsiaRetail Fund Limited (ARF)’s portfolio. FCT completed the acquisition of the remaining 63.1% interest in ARF on 27 October 2020 and
FCT owns 40% of Sapphire Star Trust which holds the interests in Waterway Point
now own 100% of this property
A N N U A L R E P O R T 2 0 2 0 / 6 7
INVESTMENT IN
ASIARETAIL FUND LIMITED
BACKGROUND OF ASIARETAIL FUND
LIMITED (“ARF”)
ARF is a private investment company.
It was previously the largest non-
listed retail mall fund in Singapore,
owning five retail malls in Singapore
(being Tiong Bahru Plaza, White
Sands, Hougang Mall, Century
Square and Tampines 1), one
office property in Singapore (being
Central Plaza) and one retail mall in
Malaysia (being Setapak Central).
With effect from 1 September 2020,
ARF is managed by Frasers Property
Corporate Services (Singapore) Pte.
Ltd., a wholly-owned subsidiary of
the Frasers Property Limited.
As at 30 September 2020, FCT held
an interest of approximately 36.89%
stake in ARF. Subsequently, FCT
completed the acquisition of the
remaining approximately 63.11%
stake in ARF on 27 October 2020 and
raised its stake in ARF to 100.0%.
HISTORY OF FCT’S SHAREHOLDING
IN ARF
FCT announced on 28 February 2019
the acquisition of initial 17.1312%
shares in ARF for approximately
S$345.9 million and the acquisition
of a further 1.67% shares on
21 March 2019 for approximately
S$34.0 million. The transactions were
completed on 5 and 26 April 2019,
respectively. Post the completion
of the transactions, FCT’s total
shareholding in ARF was 18.8%
(FY2018: Nil).
FCT’s stake in ARF increased from
18.8% to 21.13% subsequent to
shareholders’ redemption in ARF
on 30 June 2019. FCT’s stake was
further increased from 21.13%
to 24.82% following another
shareholders’ redemption on
30 September 2019.
On 30 June 2020, FCT exercised its
right of pre-emption as a shareholder
to purchase additional shares,
further increasing FCT’s stake in
ARF to 36.89% on 6 July 2020. FCT
announced on 3 September 2020
that it proposed to acquire the
remaining approximately 63.11%
interest in ARF for S$1.06 billion. An
extraordinary general meeting was
convened on 28 September 2020,
at which Unitholders’ approval
was obtained to proceed with the
proposed acquisition. The acquisition
was funded by proceeds from an
equity fund raising which raised
gross proceeds of approximately
S$1.33 billion and the acquisition
was completed on 27 October 2020.
FCT now owns 100.0% interest in ARF
whose property portfolio comprises
Tiong Bahru Plaza, White Sands,
Hougang Mall, Century Square,
Tampines 1 and Central Plaza.
FCT’s investment in ARF is stated
at cost and adjusted for share of
associate’s results, movements in
other reserves and less distributions.
The results for ARF for FY2020 was
equity-accounted for at FCT Group
level for the half year ended
30 September 2020.
SINGAPORE PROPERTIES IN ARF
PORTFOLIO
The five retail properties in Singapore
are Century Square, Tampines 1,
White Sands, Hougang Mall and
Tiong Bahru Plaza. The office
property is Central Plaza. The total
net lettable area (“NLA”) of five retail
properties is approximately 1 million
square feet and the NLA of Central
Plaza is 0.17 million square feet. The
profile of the properties are outlined
on the next page:
Contents
6 8 / F R A S E R S C E N T R E P O I N T T R U S T
INVESTMENT IN
ASIARETAIL FUND LIMITED
CENTURY SQUARE
Century Square comprises a five-storey shopping mall with three basement levels. It offers a wide range of shops
and services catering to the community and families. Shoppers can enjoy a wide array of family-friendly services and
activity spaces such as larger nursing rooms, family car park lots, roof deck with communal spaces, a 24-hour gym and
digital library kiosks on level 4. The most recent asset enhancement and refurbishment works to Century Square was
completed in May 2018.
Selected information on Century Square as at 30 June 2020, unless otherwise stated
Title
99-year leasehold title expiring on 31 August 2091
Address:
2 Tampines Central 5, Century Square, Singapore 529509
Net Lettable Area
202,446 square feet, excluding CSFS space of approximately
8,547 square feet
Number of storeys
5-storeys with 3 basement levels
Number of car park
spaces
298
Key Tenants
Filmgarde Cineplex, PRIME Food & Grocer, The Food Market,
Gymmboxx
Public Transport
Tampines MRT Station, Tampines Bus Interchange
TAMPINES 1
Tampines 1 is a haven for fashionistas and foodies with its dazzling array of renowned international fashion brands
and trendy dining concepts. This iconic retail landmark in the East is home to a curated stable of lifestyle, beauty and
fashion brands and household names such as Cold Storage and Daiso.
Selected information on Tampines 1 as at 30 June 2020, unless otherwise stated
Title
99-year leasehold title expiring on 31 March 2089
Address:
10 Tampines Central 1, Tampines 1, Singapore 529536
Net Lettable Area
268,577 square feet
Number of storeys
5-storeys with 2 basement levels
Number of car
park spaces
203
Key Tenants
Uniqlo, Cold Storage, Muji, Gain City, Daiso
Public Transport
Tampines MRT Station, Tampines Bus Interchange
WHITE SANDS
White Sands comprises six levels of exciting lifestyle and dining options. It is a popular mall for residents in the East as
it is near homes and is next to the Pasir Ris MRT station. The mall is a favourite and convenient stopover for National
Servicemen as part of their journey to and from the Pulau Tekong training camp. The most recent asset enhancement
and refurbishment works to White Sands was completed in the first quarter of 2016.
Selected information on White Sands as at 30 June 2020, unless otherwise stated
Title
99-year leasehold title expiring on 30 April 2092
Address:
1 Pasir Ris Central Street 3, White Sands, Singapore 518457
Net Lettable Area
128,631 square feet, excluding CSFS space of approximately
21,744 square feet
Number of storeys
5-storeys with 3 basement levels
Number of car park
spaces
187
Key Tenants
Popular bookstore, Saizeraya, Cookhouse by Koufu,
NTUC FairPrice
Public Transport
Pasir Ris MRT Station, Pasir Ris Bus Interchange
A N N U A L R E P O R T 2 0 2 0 / 6 9
HOUGANG MALL
Hougang Mall is located close to the Hougang MRT station and it is a popular mall amongst the residents
from the nearby residential precincts. The mall offers a variety of retail and dining options. Some of Hougang
Mall’s anchor tenants include Harvey Norman, FairPrice Supermarket, Popular Bookstore and Cheng San
Community Library.
Selected information on Hougang Mall as at 30 June 2020, unless otherwise stated
Title
99-year leasehold title expiring on 30 April 2093
Address:
90 Hougang Avenue 10, Hougang Mall, Singapore 538766
Net Lettable Area
150,593 square feet, excluding CSFS space of approximately
15,767 square feet
Number of storeys
5-storeys with 2 basement levels
Number of car park
spaces
152
Key Tenants
NTUC FairPrice, Cheng San Community Library, Mei Shi Mei Ke by
Kopitiam, Harvey Norman and Popular Bookstore
Public Transport
Hougang MRT Station, Hougang Central Bus Interchange
TIONG BAHRU PLAZA
Tiong Bahru Plaza is located in the centre of the city area amidst the charming Tiong Bahru estate, easily accessible via
the Tiong Bahru MRT Station on the East-West line.
It is a destination mall that offers an array of F&B establishments and shopping options, serving the needs of residents
around the vicinity, business executives from Central Plaza offices and students from the neighbouring schools.
Selected information on Tiong Bahru Plaza as at 30 June 2020, unless otherwise stated
Title
99-year leasehold title expiring on 31 August 2090
Address:
298 Tiong Bahru Road, Tiong Bahru Plaza, Singapore 168730
Net Lettable Area
214,708 square feet
Number of storeys
4-storeys with 3 basement levels
Number of car park
spaces
Total of 338 carpark lots are shared between Tiong Bahru Plaza
and Central Plaza
Key Tenants
Golden Village, FairPrice Finest, Kopitiam, Uniqlo and Daiso
Public Transport
Tiong Bahru MRT Station, public buses
CENTRAL PLAZA
Central Plaza is a 20-storey office building located within the city centre, strategically located outside the Central
Business District at Tiong Bahru Road. The building is conveniently located next to the Tiong Bahru MRT station and
Tiong Bahru Plaza.
Selected information on Central Plaza as at 30 June 2020, unless otherwise stated
Title
99-year leasehold title expiring on 31 August 2090
Address:
298 Tiong Bahru Road, Central Plaza, Singapore 168730
Net Lettable Area
144,250 square feet, excluding CSFS space of approximately
28,355 square feet
Number of storeys
20-storeys with 3 basement levels
Number of car park
spaces
Total of 338 carpark lots are shared between Tiong Bahru Plaza
and Central Plaza
Public Transport
Tiong Bahru MRT Station, public buses
Contents
7 0 / F R A S E R S C E N T R E P O I N T T R U S T
INVESTMENT IN
HEKTAR REIT
As at 30 September 2020, FCT holds 31.15% of the units in Hektar Real Estate Investment Trust (“H-REIT”). H-REIT, an
associate of FCT, is a retail-focused REIT in Malaysia listed on the Main Market of Bursa Malaysia Securities Berhad.
H-REIT’s property portfolio comprises Subang Parade (Selangor), Mahkota Parade (Melaka), Wetex Parade (Johor),
Central Square (Kedah), Kulim Central (Kedah) and Segamat Central (Johor).
The properties in H-REIT portfolio have a total net lettable area of 2.0 million square feet and a combined value of
RM1.24 billion.
HEKTAR PROPERTY PROFILE#
Subang Parade Mahkota Parade Wetex Parade
Central Square
Kulim Central
Segamat Central
State
Title
Net Lettable Area (Retail),
square feet as at 31 Dec 2019
Tenancies as at 31 Dec 2019
Occupancy as at 31 Dec 2019
Visitor Traffic FY2019 (million)
Acquisition Price (million RM)
Valuation (million RM)
as at 31 Dec 2019
Selangor
Melaka
Johor
Kedah
Kedah
Johor
Leasehold
(expires
2101)
Freehold
Freehold
Freehold
Freehold
Leasehold
(expires
2116)
521,464
519,663
175,014
310,564
299,781
216,345
120
93.9%
7.6
280.0
110
96.4%
8.4
232.0
71
96.2%
4.2
117.5
55
76
89.7%
95.0%
4.5
83.3
4.6
98.0
51
77.1%
3.0
106.1
440.0
329.0
144.5
97.0
130.0
96.0
#
Source: H-REIT Annual Report 2019 and its website at http://www.hektarreit.com/
HEKTAR REIT’S TOP 10 TENANTS#
The top ten tenants in the H-REIT’s portfolio contributed approximately 31% of total monthly rental income.
Tenant
Trade Sector
NLA (sq ft) % of Total NLA
% of Monthly Rental Income1
MBO Cinemas
Leisure & Entertainment/Sports & Fitness
Parkson Grand
The Store
Seleria Food Court
Mr D.I.Y.
Watson’s
Best Denki
Department Store / Supermarket
252,515
Department Store / Supermarket
273,198
Food & Beverage
Houseware & Furnishing
Health & Beauty
12,472
Electronics & IT
12.4%
13.4%
2.2%
3.7%
4.3%
0.6%
2.2%
3.7%
0.6%
3.5%
43,134
75,808
88,670
45,669
75,928
12,164
72,140
MM Cineplexes
Leisure & Entertainment / Sports & Fitness
Guardian
Health & Beauty
Giant Superstore
Department Store / Supermarket
Top 10 Tenants (By Monthly Rental Income)
Other Tenants
Total
951,698
1,091,133
46.6%
53.4%
2,042,831
100.0%
#
1
Source: H-REIT Annual Report 2019 and its website at http://www.hektarreit.com/
Based on monthly rental income for December 2019
9.5%
5.9%
3.2%
2.0%
2.0%
1.9%
1.8%
1.7%
1.6%
1.4%
31.0%
69.0%
100.0%
A N N U A L R E P O R T 2 0 2 0 / 7 1
TENANCY MIX#
As at 31 December 2019
The largest rental contributors to the portfolio are tenants from the fashion & footwear and the food & beverage
segments. Both segments contributed 41% of the portfolio’s total rental income. In terms of NLA occupancy,
department stores and supermarkets continue to dominate the portfolio by taking up 36% of all available NLA.
By Rental Income*
By Net Lettable Area
Fashion & Footwear
Food & Beverage / Food Court
Department Store / Supermarket
Leisure & Entertainment, Sports & Fitness
Health & Beauty
Electronics & IT
Gifts / Books / Toys / Specialty
Homewares & Furnishing
Education / Services
Total
#
*
Source: H-REIT Annual Report 2019 and its website at http://www.hektarreit.com/
Based on monthly rental income for December 2019
PORTFOLIO LEASE EXPIRY PROFILE#
As at 31 December 2019
20%
21%
18%
11%
11%
9%
4%
5%
1%
100%
9%
11%
36%
20%
5%
6%
4%
8%
1%
100%
A total of 233 tenancies will expire in 2020 representing approximately 39% of NLA and 48% of monthly rental income
as at 31 December 2019.
For Year Ending 31 December
No. of Tenancies
Expiring
NLA of Tenancies
Expiring (sq ft)
NLA of Tenancies Expiring
as % of Total NLA
% of Total Monthly
Rental Income *
FY 2020
FY 2021
FY 2022
233
170
80
794,912
849,482
245,204
39%
42%
12%
48%
38%
15%
#
*
Source: H-REIT Annual Report 2019 and its website at http://www.hektarreit.com/
Based on monthly rental income for December 2019
Contents
7 2 / F R A S E R S C E N T R E P O I N T T R U S T
RISK
MANAGEMENT
Effective risk management is
a fundamental part of FCT’s
business strategy. Key risks, control
measures and management
actions are continually being
identified, reviewed and monitored
by management of the Manager
(“Management”) as part of the
Manager’s enterprise-wide risk
management (“ERM”) framework.
Recognising and managing risks
are central to the business and for
protecting unitholders’ interests.
GOVERNANCE AND OVERSIGHT
The Board of Directors of the
Manager is responsible for the
governance of risks and ensuring
that the Manager maintains a sound
system of risk management and
internal controls. The Manager
has established a sound system
of risk management and internal
controls comprising procedures
and processes to safeguard FCT’s
assets and FCT’s and its Unitholders’
interests. The Audit, Risk and
Compliance Committee (“ARCC”)
reviews and reports to the Board on
the adequacy and effectiveness of
such controls, including financial,
compliance, operational and
information technology controls, and
risk management procedures and
systems, taking into consideration
the recommendations of both
internal and external auditors.
RISK MANAGEMENT FRAMEWORK
ERM reporting is facilitated through a
web-based Corporate Risk Scorecard
system which enables the reporting
of risks and risk status using a
common platform in a consistent and
cohesive manner.
The Manager seeks to benchmark its
ERM framework against industry best
practices and standards. In assessing
areas for improvement and how the
ERM processes and practices can be
strengthened, reference has been
made to the best practices in risk
management including those set out
in the Code of Corporate Governance
2018 and the Risk Governance
Guidance for Listed Boards issued by
the Corporate Governance Council in
May 2012.
Risks are reported at the operational
level using a Risk Scorecard which
captures risks, risk ratings, mitigating
measures and timeline for action
items. Where applicable, Key Risk
Indicators (“KRIs”) are established
to monitor risks. For risks that are
material, the mitigating measures
and KRIs are reported in the Key Risk
Dashboard for review by the ARCC on
a regular basis.
Risk tolerance statements, which
set out the nature and extent of
significant risks which the Manager
is willing to take in achieving its
strategic objectives, are reviewed
annually. The tolerance limits are
monitored and reported to the ARCC
on a half yearly basis.
Formal risk reviews take place half
yearly and the Risk Scorecard is
updated regularly. On a yearly basis,
ERM validation is held with the
Management. Key risks have been
identified and the corresponding
mitigating measures taken are
adequate. The results are presented
to the ARCC to provide assurance
that the risk management system
in place for FCT was adequate and
effective to address risks which the
Manager considers relevant and
material to FCT’s operations.
Apart from the ERM process, key
business risks are thoroughly
assessed by Management and
each significant transaction is
comprehensively analysed so that
Management understands the risks
involved before it is embarked upon.
FCT’s ERM framework promotes
a risk management culture. The
Manager works closely with Frasers
Property Limited’s Risk Management
Team to conduct workshops where
necessary to reinforce and enhance
risk management knowledge and
management principles.
KEY RISKS IN FINANCIAL YEAR 2020
The Manager identifies key risks,
assesses their likelihood and
materiality to FCT’s business and
documents corresponding mitigating
controls in a risk register. The risk
register is reviewed and updated
regularly.
OPERATIONAL RISK
The Manager has established and
strictly adheres to a set of standard
operating procedures designed
to identify, monitor, report and
manage the operational risks
associated with the day-to-day
management and maintenance of
FCT malls. These procedures and
guidelines are regularly reviewed
and benchmarked against industry
best practices to ensure relevance
and effectiveness. Insurances are also
in place to mitigate losses resulting
from unforeseen events. Business
Continuity Plans are regularly tested
for their effectiveness.
HUMAN CAPITAL RISK
The REIT Manager has in place a
career planning and development
system for its staff, and conducts
regular remuneration and benefits
benchmarking to attract and retain
appropriate talent for the business.
Regular training and development
opportunities are also provided to
upgrade the skills and knowledge
of the staff. Employee satisfaction
surveys are also deployed to
measure employee engagement
and sentiments.
LIQUIDITY RISK
In ensuring a prudent financial
structure for FCT, the Manager
adheres closely to the covenants
in the loan agreements and the
property fund appendix in the Code
on Collective Investment Schemes
issued by the Monetary Authority of
Singapore. In addition, the Manager
proactively manages FCT’s cashflow
position and liquidity requirements.
During the Circuit Breaker period
from 7 April to 1 June 2020,
businesses termed as non-essential
had been shut. The uncertainty
of the rate of spread of COVID-19
outbreak brought about credit risk
exposure from tenants. FCT, together
with its sponsor, Frasers Property
Limited, rolled out tenant assistance
packages, mainly in the form of
rental rebates and rent deferment,
to help tenants cope with their
cashflow challenges.
In view of the disruption caused by
COVID-19, the Manager has secured
additional Revolving Credit Facilities
totaling S$445 million as of 30
September 2020 to ensure adequacy
of liquidity reserves to finance its
operations, asset enhancement
initiatives (“AEIs”) and any other
unforeseen short-term obligations.
FCT’s liquidity is supported by its
long-term banking relationships and
track record of strong access to the
debt capital market.
Please refer to page 34 under
Capital Resources section on the
various sources of funds availability
and their utilisations. The Manager
continues to comply with its policy of
spreading out concentration of debts
maturing in a single year.
INVESTMENT RISK
As FCT grows its investment portfolio
via the acquisition of new properties
and other forms of permitted
investments, all investment
opportunities are subject to a
disciplined and rigorous appraisal
process. All investment proposals are
evaluated based on a comprehensive
set of investment criteria including
alignment with FCT’s investment
mandate, asset quality, expected
returns, sustainability of asset
performance and future growth
potential, having due regard to
market conditions and outlook.
INTEREST RATE RISK
Interest rate risk is proactively
managed by the Manager with
the primary objective of limiting
the extent to which net interest
expense could be affected by adverse
movements in interest rates. In
accordance with the Manager’s
hedging policy, at least 50% of FCT’s
outstanding borrowings are at fixed
interest rates.
CREDIT RISK
The Manager has established credit
limits for tenants and monitors their
debt levels on an ongoing basis.
Credit evaluations are performed
before lease agreements are entered
into with tenants. Credit risk is
also mitigated by collecting rental
deposits from the tenants. Cash
and fixed deposits are placed with
regulated financial institutions.
COMPLIANCE RISK
FCT is subject to relevant laws and
regulations including the Listing
Manual of the Singapore Exchange
Securities Trading Limited, the Code
on Collective Investment Schemes
issued by the Monetary Authority of
Singapore and the tax rulings issued
by the Inland Revenue Authority
of Singapore with regard to the
taxation of FCT and its Unitholders.
Any changes to these regulations
may affect FCT’s operations and
results. The Manager has in place
policies and procedures to facilitate
compliance with applicable laws
and regulations. Management keeps
abreast of latest developments
in relevant laws and regulations
through training and attending talks
and briefings.
TECHNOLOGY RISK
Digital disruption and the future
of work that are enabled by digital
technology offer new opportunities
and challenges. The Frasers Property
Group (the “Group”), of which the
Manager is part of, continues to
build digital capabilities and invest
in new technologies to ensure
that our business is future-ready.
Group-wide policies and procedures
have been put in place to ensure
the confidentiality, availability and
integrity of IT systems, as well as to
ensure that cybersecurity threats
are managed. Disaster recovery
plans and incident management
procedures have been developed and
are tested regularly. Measures and
considerations have also been taken
to enable effective privileged access
A N N U A L R E P O R T 2 0 2 0 / 7 3
monitoring, patch management,
data security, data protection and
safeguard against prolonged service
unavailability of critical IT systems.
Periodic trainings are conducted
for new and existing employees to
raise IT security awareness. External
professional service providers are
engaged to conduct independent
vulnerability assessment and
penetration tests to further
strengthen the IT systems.
EXTERNAL RISK
FCT is exposed to a challenging
business climate, including impact
from COVID-19 outbreak, and rapidly
changing retail market trends,
including manpower shortage,
stagnant pool of prospective
tenants, and e-commerce consumer
shopping behaviour. The Manager
continuously seeks to strengthen
FCT’s competitiveness through
optimising tenant mix, revitalizing
mall concepts and AEIs.
FRAUD AND CORRUPTION RISK
The Manager does not condone any
acts of fraud, corruption or bribery
by employees in the course of our
business activities. The Manager
adheres to the various policies and
guidelines established by the Group,
including a Code of Business Conduct
and an Anti-Bribery Policy, to guide
employees on business practices,
standards and conduct expected
during their employment with
the Group.
The Manager has put in place
a whistle-blowing policy (the
“Whistle-Blowing policy”). The
Whistle-Blowing policy provides
an independent feedback channel
through which matters of concern
about possible improprieties in
matters of financial reporting,
suspected fraud and corruption
or other matters may be raised by
employees and any other persons in
confidence and in good faith, without
fear of reprisal. The ARCC reviews
and ensures that independent
investigations and appropriate
follow-up actions are carried out.
More details can be found in the
Corporate Governance section
of this Annual Report on pages 101
to 136.
Contents
7 4 / F R A S E R S C E N T R E P O I N T T R U S T
SUSTAINABILITY
REPORT
A N N U A L R E P O R T 2 0 2 0 / 7 5
CONTENTS
76
77
78
80
83
84
87
90
96
97
Board Statement
The Year At A Glance
Strengthening Our Sustainability Core
Managing Sustainability
Materiality Assessment
Acting Progressively
Consuming Responsibly
Focusing on People
About This Report
GRI Content Index
7 6 / F R A S E R S C E N T R E P O I N T T R U S T
BOARD
STATEMENT
The scale and extent of the COVID-19 has made the year
2020 the most challenging year for all businesses, and
the retail sector is one of the hardest hit sectors of the
economy. However, it is also during this difficult period
that we recognise the importance of our role to provide
relevance and values beyond the financial performance
for our stakeholders and the community.
While we navigate through the challenges from
COVID-19 especially during the Circuit Breaker, our
belief and sense of purpose in sustainability is further
reinforced. We place sustainability at the core of our
business to demonstrate our commitment to leave
positive impacts to the environment and society.
We are cognisant of the rising concerns on climate
change and social issues and we believe sustainability is
the key to strengthen our competitive advantage in an
ever-evolving business landscape. At the same time, we
need to be agile and resilient to sustainably grow our
business and remain viable in the future.
During the year, we took progressive actions in
accelerating our sustainability action plans. We have
identified five global sustainability goals together with
the Group, focusing on energy and carbon, resilient
properties, responsible investment, health and well-
being and diversity and inclusion. The long term goal is
to achieve net zero carbon by 2050. These goals mark a
major milestone in our sustainability journey.
While we navigate through the
challenges from COVID-19 especially
during the Circuit Breaker, our belief and
sense of purpose in sustainability is further
reinforced. We place sustainability at the
core of our business to demonstrate our
commitment to leave positive impacts to the
environment and society.
To realise our goals, we have developed overarching
workplans with long and short-term targets to ensure
that we are on the right track with our efforts. We have
started to embark on our decarbonisation and building
resilience journey together with our Sponsor. In parallel,
we also continue to invest in communities to ensure that
they grow alongside our business.
Our management works closely with the newly
formed Frasers Property Retail Sustainability Steering
(FPR SSC) and Frasers Property Retail Sustainability
Working Committee (FPR SWC) to oversee and drive
the implementation of our goals and targets. The Board
continues to oversee the management of sustainability
with the support of FPR SSC and FPR SWC.
We are pleased to share with you our sixth Sustainability
Report and invite you to read on to find out more about
our progress and achievements during the year.
Board of Directors
Frasers Centrepoint Asset Management Ltd.
as Manager of Frasers Centrepoint Trust
A N N U A L R E P O R T 2 0 2 0 / 7 7
THE YEAR
AT A GLANCE
ACTING PROGRESSIVELY
Adopted and implemented the
Group Corporate Social
Responsibility Policy
100% compliant
to all relevant laws and
regulations
Four properties are green building certified
with two more properties completing
certification by end-April 2021
CONSUMING RESPONSIBLY
Achieved
17.7%
reduction of
water usage
intensity y-o-y
Collected 364,318 used
bottles and cans for
recycling during the year
Collected 9.6 tonnes
of e-waste for recycling
during the year
Solar photovoltaic
installed at Changi City
Point to power all billboard
lightings at the rooftop
Achieved
12.5%
reduction
in GHG
emissions
intensity
y-o-y
FOCUSING ON PEOPLE
Achieved 38
training
hours per
employee in
FY2020
100% of the
REIT manager’s
employees
are trained in
sustainability
related topics
Collected
4.6 tonnes
of foodstuff
for donation to
Food Bank
Singapore
Zero fatalities
and zero non-
compliance with
the relevant health and
safety laws and regulations
during the year
All properties are SG Clean certified
S$27.4 million in rental rebates
provided as part of Frasers Property
Retail’s Tenant Support Package
to help tenants cope with COVID-19
challenges
First retail mall in Singapore to roll out
UV-disinfectant autonomous
mobile robots in response to
COVID-19
Contents
7 8 / F R A S E R S C E N T R E P O I N T T R U S T
STRENGTHENING OUR
SUSTAINABILITY CORE
As a multinational group with global footprint, Frasers Property Group plays a critical role in influencing the industry
ecosystem by driving sustainable development. Over the years, the Group has built a strong foundation that addresses
the three aspects of sustainability – Environmental, Social and Governance (ESG). It forms the backbone of how we run
our business. The management views sustainability as an opportunity to future-proof our business.
FCT’s sustainability approach is aligned to the Group’s Sustainability Framework. The Framework sets out the
sustainability priorities through to 2030, underpinned by three strategic pillars – Acting Progressively, Consuming
Responsibly and Focusing on People. The pillars are supported by 13 focus areas to form a multi-disciplinary approach,
suited to FCT’s business.
We recognise the increasing concerns globally on ESG issues such as climate change, investing responsibly and
health and safety. To remain competitive and sustainably grow our business in the long-term, we have to be agile and
augment the way our business operates to respond to these concerns.
During the year, the Group has come together to set five new group goals that sets our direction through to 2050. This
is also a testament of our commitment to sustainability and ambition to further deepen sustainable practices across
the Group.
GOAL
#1
GOAL
#2
GOAL
#3
GOAL
#4
GOAL
#5
To be a net zero
carbon corporation
by 2050
To be climate
resilient and
establish adaptation
and mitigation plans
by 2024
To green-certify 80%
of our owned and
managed assets
by 2024
To finance majority
of our sustainable
asset portfolios
with green and
sustainable
financing by 2024
To train all our
employees on
sustainability
by 2021
In support of the group goals, FCT has developed a strategic action plan to drive the sustainability agenda across our
portfolio. We have identified key goals and targets and tracking our performance to ensure we are on track to realise
the group goals.
A N N U A L R E P O R T 2 0 2 0 / 7 9
OUR SUSTAINABILITY FRAMEWORK
P I L L A R S
Acting
Progressively
Consuming
Responsibly
F O C U S A R E A S
Focusing on
People
Innovation
Fostering an innovation
culture that creates value
and strengthens our
competitive edge
Materials & Supply Chain
Achieving the sustainable
management and efficient
use of material along the
supply chain
Resilient Properties
Strengthening the resilience and
climate adaptive capacity
Biodiversity
Enhancing the environment
and ecosystem through
our developments
Risk-based Management
Comprehensive assessment to
address environmental, health and
safety risks
Responsible Investment
Incorporating social, environment
and governance criteria in the
evaluation process
Energy & Carbon
Increasing substantially energy
efficiency and renewable
energy used
Waste
Reducing substantially waste
generation through prevention,
reduction, recycling and reuse
Water
Increasing substantially water
efficiency and the recycling and safe
reuse of water discharged
Community Connectedness
Considering social value principles
for communities
Health & Well-being
Ensuring healthy and balanced
work and community
environments
Diversity & Inclusion
Empowering and promoting the
social inclusion of all, irrespective
of age, sex, disability, race,
ethnicity, origin, religion,
economic or other status
Skills & Leadership
Developing skills and leadership
programmes that support
productive activities, creativity
and innovation to deliver
high-value
Contents
8 0 / F R A S E R S C E N T R E P O I N T T R U S T
MANAGING
SUSTAINABILITY
SUSTAINABILITY GOVERNANCE
STAKEHOLDER MANAGEMENT
The Board recognises that
sustainability is key in ensuring
the success of FCT’s business. As a
sponsored REIT, our sustainability
agenda closely aligns with our
Sponsor’s to demonstrate our unified
approach across the Frasers Property
Group. We work collaboratively with
the Group’s sustainability leadership
and working teams to realise our
goals and objectives.
The Group Sustainability Steering
Committee, which leads the
sustainability agenda in Frasers
Property Group, is chaired by
the Group CEO, Mr Panote
Sirivadhanabhakdi. The Frasers
Property Retail Sustainability
Steering Committee (FPR SSC) and
Frasers Property Retail Sustainability
Working Committee (FPR SWC) were
formed this year. The Retail SSC
consists of the top management
executives, led by the CEO of Frasers
Property Retail, Mr Low Chee Wah.
The Retail SSC is responsible to make
key decisions in support of the Group
Sustainability Goals. FCAM’s CEO,
Mr Richard Ng is also a member of
the FPR SSC. The FPR SWC supports
the FPR SSC in the implementation
of action plans approved by the FPR
SSC and to monitor the performance
against key performance indicators.
The FPR SWC comprises the members
of middle and senior management,
including FCAM’s team. Additionally,
a Global Sustainability Taskforce
which was incorporated in 2019
supports the development of the
sustainability plans and monitors the
performance.
Key Stakeholders Key Topics of Concern
Mode of Engagement
Frequency of Engagement and FY2020 Highlights
Tenants
Shoppers
• Maintaining healthy shopper traffic
• Competitive rental rates
• Collaboration in marketing and promotional
events
• Meeting our shoppers’ needs
• Quality of services and facilities
• Providing safe and comfortable shopping
environment and family-friendly amenities
• Frequent dialogue, including virtual meetings
• Partnership in promotional events
• Regular tenant feedback meetings
• Conduct tenant satisfaction survey
• Throughout the year
• Throughout the year
• Throughout the year
(no fixed frequency)
• Completed tenant satisfaction survey in FY2020
• Shopper surveys
• Focus group study
• Shopper surveys (no fixed frequency)
• Throughout the year, as-and-when required for
• Feedback via online and various social media such as
engagements on social media
Facebook, Instagram and LinkedIn and FCT/Frasers
• Considerations for safety, accessibility and easy
Property websites
navigation within the mall
• Good connectivity to public transport
• Regular events to engage shoppers and their families
• Throughout the year
• Frasers Experience, the Frasers shopper loyalty
• Throughout the year
Employees
• Compensation and Benefits
• Career progression
• Continuous education and skills upgrading
• Employee well-being
Property manager
• Key Performance Indicators (KPIs) for the
• Regular meetings
• Every month for regular meetings and ad-hoc
property manager
Investors and FCT
unitholders
• Business and operations performance
• Business strategy and outlook
• Sustainability concerns
Local Community
• Helping the groups in need in the community
• Foster strong community ties and promote
• Annual Charity Drives and Mass Participation Events
• Normally these events are organised regularly
• Providing venue space at our malls to charitable
throughout the year. However due to COVID-19, most
family values
organisations
Regulators
and industry
associations
• Compliance with relevant rules and regulations
• Engagement with investors and unitholders
• Government policies on REITs or Real Estate
•
sector
Issues concerning both short and long-term
interests of the retail industry in Singapore
• Feedback to customer service staff or at customer
• Throughout the year
• Throughout the year
• Annually
• Throughout the year
• Orientation and training programmes organised
• Upon joining and throughout the year (employees
by Frasers Property Human Resource and Learning
received an average of 38 hours of training per person
program
• Feedback forms
service counters and concierge
• Annual performance appraisals
• Communal sports and activities
Academy
• Regular department meetings
• Family Day Events
• Employee satisfaction survey
• Conducted via virtual platforms in FY2020
• Family Day Events are suspended in FY2020 due to
in FY2020)
COVID-19
• Annually
• Exchanges on Workplace by Facebook
• Exchanges on emails and calls
meetings as-and-when required
• Regularly throughout the year
• Regularly throughout the year
•
Investor meetings, quarterly post-results luncheons
• Throughout the year in FY2020. However, due to
and non-deal roadshows, mall tours and Annual
COVID-19, the investors meetings after March 2020
General Meetings
were held via virtual platforms
• Website, annual reports, SGXNET announcements,
• Throughout the year
presentation slides, quarterly financial results briefings
and conference calls
if not all, of these activities have been suspended
in 2020. We plan to resume these activities when
situation permits
• Participation in industry associations including REIT
• Participation in the events organised by the various
Association of Singapore (REITAS), Investor Relations
industry association and by the regulator normally
Professionals Association (IRPAS), Orchard Road
occur throughout the year. However, due to COVID-19,
Business Association (ORBA), Securities Investors
these activities have been converted to virtual
Association (Singapore) (SIAS) and Singapore Retailers
meetings or postponed
Association (SRA)
• Participation in briefings and consultation with
regulators such as the SGX and MAS
A N N U A L R E P O R T 2 0 2 0 / 8 1
STAKEHOLDER MANAGEMENT
Key Stakeholders Key Topics of Concern
Mode of Engagement
Frequency of Engagement and FY2020 Highlights
Tenants
• Maintaining healthy shopper traffic
• Competitive rental rates
• Collaboration in marketing and promotional
events
• Frequent dialogue, including virtual meetings
• Partnership in promotional events
• Regular tenant feedback meetings
• Conduct tenant satisfaction survey
• Shopper surveys
• Focus group study
• Feedback via online and various social media such as
Facebook, Instagram and LinkedIn and FCT/Frasers
Property websites
• Throughout the year
• Throughout the year
• Throughout the year
• Completed tenant satisfaction survey in FY2020
(no fixed frequency)
• Shopper surveys (no fixed frequency)
• Throughout the year, as-and-when required for
engagements on social media
• Regular events to engage shoppers and their families
• Frasers Experience, the Frasers shopper loyalty
• Throughout the year
• Throughout the year
program
• Feedback forms
• Feedback to customer service staff or at customer
• Throughout the year
• Throughout the year
service counters and concierge
• Annual performance appraisals
• Communal sports and activities
• Orientation and training programmes organised
• Annually
• Throughout the year
• Upon joining and throughout the year (employees
by Frasers Property Human Resource and Learning
Academy
received an average of 38 hours of training per person
in FY2020)
• Regular department meetings
• Family Day Events
• Employee satisfaction survey
• Conducted via virtual platforms in FY2020
• Family Day Events are suspended in FY2020 due to
COVID-19
• Annually
Property manager
• Key Performance Indicators (KPIs) for the
• Regular meetings
• Every month for regular meetings and ad-hoc
• Exchanges on Workplace by Facebook
• Exchanges on emails and calls
meetings as-and-when required
• Regularly throughout the year
• Regularly throughout the year
•
Investor meetings, quarterly post-results luncheons
and non-deal roadshows, mall tours and Annual
General Meetings
• Throughout the year in FY2020. However, due to
COVID-19, the investors meetings after March 2020
were held via virtual platforms
• Website, annual reports, SGXNET announcements,
• Throughout the year
family values
organisations
presentation slides, quarterly financial results briefings
and conference calls
• Annual Charity Drives and Mass Participation Events
• Providing venue space at our malls to charitable
• Participation in industry associations including REIT
Association of Singapore (REITAS), Investor Relations
Professionals Association (IRPAS), Orchard Road
Business Association (ORBA), Securities Investors
Association (Singapore) (SIAS) and Singapore Retailers
Association (SRA)
• Participation in briefings and consultation with
regulators such as the SGX and MAS
• Normally these events are organised regularly
throughout the year. However due to COVID-19, most
if not all, of these activities have been suspended
in 2020. We plan to resume these activities when
situation permits
• Participation in the events organised by the various
industry association and by the regulator normally
occur throughout the year. However, due to COVID-19,
these activities have been converted to virtual
meetings or postponed
Contents
Shoppers
• Meeting our shoppers’ needs
• Quality of services and facilities
• Providing safe and comfortable shopping
environment and family-friendly amenities
• Considerations for safety, accessibility and easy
navigation within the mall
• Good connectivity to public transport
Employees
• Compensation and Benefits
• Career progression
• Continuous education and skills upgrading
• Employee well-being
property manager
Investors and FCT
• Business and operations performance
unitholders
• Business strategy and outlook
• Sustainability concerns
Local Community
• Helping the groups in need in the community
• Foster strong community ties and promote
Regulators
and industry
associations
• Compliance with relevant rules and regulations
• Engagement with investors and unitholders
• Government policies on REITs or Real Estate
sector
•
Issues concerning both short and long-term
interests of the retail industry in Singapore
8 2 / F R A S E R S C E N T R E P O I N T T R U S T
MANAGING
SUSTAINABILITY
INDUSTRY ALIGNMENT
Collaboration is key to realising our goals and it is critical to encourage the real estate sector to create a new ecosystem
where sustainability is a priority. FCT actively participates in various professional and business associations to influence
positive outcomes including:
- Securities Investors Association (Singapore) (SIAS)
- REIT Association of Singapore (REITAS)
-
- Orchard Road Business Association (ORBA)
- Singapore Retailers Association (SRA)
Investor Relations Professionals Association (IRPAS)
Sustainability
Pillars
Focus Areas
What does it mean to FCT
Responsible
Investment
We invest with long-term views that includes financial and sustainability
considerations to deliver regular and stable distributions to our Unitholders, and to
achieve growth in FCT’s net asset value per Unit. We target to achieve sustainable
improvement in our economic performance.
Risk-based
Management
We have the duty to ensure our business continuously assess the environment,
health and safety and social risks to ensure we are in compliance with the relevant
environmental laws and regulations.
Acting
Progressively
We have a zero-tolerance approach towards corruption and fraud. We strive to
maintain high standards of integrity, accountability and corporate governance.
Anti-corruption (GRI 205)
FCT, Suppliers / Contractor,
and Shoppers / Tenants
Resilient
Properties
Innovation
Energy &
Carbon
Water
Waste
We ensure compliance with the Code of Advertising Practice and applicable
guidelines and principles for responsible communications and marketing.
We seek to understand and respond to the risks and opportunities related to
climate change to enhance the resilience of our properties and future-proof our
business.
Innovation is the key driver to remain relevant and competitive in the retail
industry. Agility and adaptability will lead to a viable business in the long-term.
Real estate is one of the largest users of energy, particularly in heating and
cooling. We strive to proactively reduce energy consumption of our properties and
contribute towards achieving net zero carbon.
Similar to energy management, we strive to reduce wastage of water and to recycle
and reuse wherever we can.
We are committed to encouraging waste reduction and recognise that waste
management is key to improving resource use and recycling.
Diversity &
Inclusion
Skills &
Leadership
We value our employees, and we seek to invest in their learning and help them in
developing their career with us. We continuously seek to attract and retain the
human capital and talents as we continue to grow in our business.
We maintain open-door communication with our employees to foster trust and
confidence in our communications.
Health & Well-
being
We want to provide space at our properties that our stakeholders, including
shoppers, contractors and tenants, feel safe and comfortable to carry out their
intended activities.
Community
Connectedness
We strive to foster healthy interactions with the local communities, to build a
strong sense of belonging and connections with them, and also to contribute back
to the community by helping the less fortunate members of the community.
Consuming
Responsibly
Focusing on
People
1
Please refer to our annual report for further details.
Material Topics & GRI Topic Boundaries
Corresponding UN SDGs
Economic Performance1
FCT
(GRI 201)
Environmental Compliance
FCT, Suppliers / Contractor
(GRI 307)
and Shoppers / Tenants
(GRI 417)
(GRI 201)
(GRI 201)
Marketing and Labelling
FCT
Economic Performance
FCT, Shoppers / Tenants
Economic Performance
FCT, Shoppers / Tenants
Energy (GRI 302)
FCT, Shoppers / Tenants
Emissions (GRI 305)
Water (GRI 303)
FCT, Shoppers / Tenants
Additional Disclosure:
FCT, Shoppers / Tenants
Waste (GRI 306)
Employment (GRI 401)
FCT
Training and Education
(GRI 404)
Labour / Management
Relations (GRI 402)
Occupational Health &
FCT, Suppliers / Contractors,
Safety (GRI 403)
Shoppers / Tenants and
NGOs / Local Communities
Local Communities
FCT, NGOs / Local
(GRI 413)
Communities
A N N U A L R E P O R T 2 0 2 0 / 8 3
MATERIALITY ASSESSMENT
We recognise the importance of ensuring the relevance of our material topics to our business. Thus, we conduct regular
review of our 10 material topics with consideration of the business landscape and stakeholder concerns. We concluded
that our material topics continue to remain relevant and aligned to our sustainability agenda. While our material topics
remain unchanged, we integrated three additional focus areas - Resilient Properties, Innovation and Waste in an effort
to align more closely with our Sponsor. The table below shows how our material topics correspond to the 13 focus
areas of our Sustainability Framework and relevance to the United Nations Sustainable Development Goals (SDGs).
The table also shows the significance of each material topic and where we have caused or contributed to the impacts
through our business relationships.
Sustainability
Pillars
Focus Areas
What does it mean to FCT
Responsible
We invest with long-term views that includes financial and sustainability
Investment
considerations to deliver regular and stable distributions to our Unitholders, and to
achieve growth in FCT’s net asset value per Unit. We target to achieve sustainable
improvement in our economic performance.
Material Topics & GRI Topic Boundaries
Corresponding UN SDGs
Economic Performance1
(GRI 201)
FCT
Risk-based
We have the duty to ensure our business continuously assess the environment,
Management
health and safety and social risks to ensure we are in compliance with the relevant
Environmental Compliance
(GRI 307)
FCT, Suppliers / Contractor
and Shoppers / Tenants
environmental laws and regulations.
Acting
Progressively
We have a zero-tolerance approach towards corruption and fraud. We strive to
maintain high standards of integrity, accountability and corporate governance.
Anti-corruption (GRI 205)
FCT, Suppliers / Contractor,
and Shoppers / Tenants
We ensure compliance with the Code of Advertising Practice and applicable
guidelines and principles for responsible communications and marketing.
Marketing and Labelling
(GRI 417)
FCT
Resilient
Properties
We seek to understand and respond to the risks and opportunities related to
climate change to enhance the resilience of our properties and future-proof our
Economic Performance
(GRI 201)
FCT, Shoppers / Tenants
business.
Innovation
Innovation is the key driver to remain relevant and competitive in the retail
industry. Agility and adaptability will lead to a viable business in the long-term.
Economic Performance
(GRI 201)
FCT, Shoppers / Tenants
Energy &
Carbon
Consuming
Responsibly
Real estate is one of the largest users of energy, particularly in heating and
Energy (GRI 302)
FCT, Shoppers / Tenants
cooling. We strive to proactively reduce energy consumption of our properties and
contribute towards achieving net zero carbon.
Emissions (GRI 305)
Water
Similar to energy management, we strive to reduce wastage of water and to recycle
Water (GRI 303)
FCT, Shoppers / Tenants
and reuse wherever we can.
Waste
We are committed to encouraging waste reduction and recognise that waste
management is key to improving resource use and recycling.
Additional Disclosure:
Waste (GRI 306)
FCT, Shoppers / Tenants
Diversity &
We value our employees, and we seek to invest in their learning and help them in
Employment (GRI 401)
FCT
Focusing on
People
Inclusion
developing their career with us. We continuously seek to attract and retain the
human capital and talents as we continue to grow in our business.
Skills &
We maintain open-door communication with our employees to foster trust and
Leadership
confidence in our communications.
Health & Well-
We want to provide space at our properties that our stakeholders, including
being
shoppers, contractors and tenants, feel safe and comfortable to carry out their
intended activities.
Community
We strive to foster healthy interactions with the local communities, to build a
Connectedness
strong sense of belonging and connections with them, and also to contribute back
to the community by helping the less fortunate members of the community.
1
Please refer to our annual report for further details.
Training and Education
(GRI 404)
Labour / Management
Relations (GRI 402)
Occupational Health &
Safety (GRI 403)
FCT, Suppliers / Contractors,
Shoppers / Tenants and
NGOs / Local Communities
Local Communities
(GRI 413)
FCT, NGOs / Local
Communities
Contents
8 4 / F R A S E R S C E N T R E P O I N T T R U S T
ACTING
PROGRESSIVELY
At FCT, we want to deliver positive outcomes through our retail properties. Our
approach takes into consideration risks, opportunities and deeper integration of
sustainability into our business decisions and management of our portfolio while
grounded by sound corporate governance. To set FCT apart from our peers, we
believe in acting progressively and embrace innovation to augment the value that
we deliver through our sustainability objectives.
OUR APPROACH
Institute overarching policies to strengthen FCT’s business operations and business resilience
•
• Pursue green building certifications for the properties as part of our strategy to raise our sustainability offerings to
our stakeholders
• Uphold responsible investment practices by incorporating ESG risks and opportunities into investment decisions
OUR PROGRESS
Focus Areas
Our Goals
Our Progress in FY2020
Contribution
to UNSDGs
• To establish holistic overarching
• FCT adopted and implemented the
internal policies to govern and guide
management of the focus areas.
Group Corporate Social Responsibility
Policy.
Risk-based
Management
Responsible
Investment
Resilient
Properties
• To achieve at least Green Mark Gold
Certification for 80% of existing
buildings by 2024.
• To finance majority of our sustainable
asset portfolios with green and
sustainable financing by 2024.
• To carry out climate risk assessments
and implement asset-level
adaptation and mitigation plans with
alignment to the TCFD framework by
2024.
Innovation
• To cultivate a customer-centric and
collaborative mindset.
• Four out of seven properties in FCT’s
portfolio are green certified. Additional
two properties will complete their
certification by April 2021.
• FCT plans to secure its inaugural green
loan within the next 12 to 24 months.
• Climate risk assessment for FCT
properties has started with the
collation of Scope 1, 2 and 3 carbon
inventory data for properties.
• The Group encourages employees to
undergo design thinking training in
due course to equip them with the
necessary knowledge and skillset
to cultivate customer-centric and
collaborative mindset.
A N N U A L R E P O R T 2 0 2 0 / 8 5
RISK-BASED MANAGEMENT
Strong corporate governance contributes to the success
of our business. Good business ethics and transparency,
together with robust policies are key to ensure that we
are operating in compliance with laws and regulations.
We strive to uphold fair and ethical business conduct
with zero tolerance towards corruption and fraud. We
also align our business practices to the relevant industry
laws and regulations such as the Code of Corporate
Governance 2018, Code of Advertising Practice, listing
rules and regulations set out by SGX-ST and the MAS
Securities and Futures Act. As part of the Frasers Property
Group, we continue to be guided by our Sponsor’s
corporate policies.
- Code of Business Conduct
- Whistle-blowing Policy
- Anti-bribery Policy
- Competition Act Compliance Manual
- Personal Data Protection Act Policy
- Environment, Health and Safety Policy
- Legal and Regulatory Compliance Manual
- Policy on Dealing in Units of FCT and Reporting
Procedures
- Policy for Prevention of Money Laundering and
Countering the Financing of Terrorism
- Policy on Outsourcing
- Treasury Policy
- Diversity and Inclusion Policy
- Corporate Social Responsibility Policy
One of our approaches towards responsible investment is
by improving our portfolio’s ESG performance. Our goal is
to certify 80% of our existing buildings by 2024 to at least
Building Construction Authority (BCA) Green Mark Gold
certification. All our properties are regularly assessed to
identify improvement opportunities to better serve our
customers and tenants. Asset enhancement initiatives
(“AEI”) are conducted in a timely manner to continuously
upgrade our properties for optimum performance.
Within our portfolio, four of our properties are certified
green buildings by the BCA. Causeway Point achieved
the highest certification – BCA Green Mark Platinum.
Northpoint City North Wing and Bedok Point are certified
to BCA Green Mark Gold and YewTee Point is certified to
BCA Green Mark.
Changi City Point and Waterway Point are in the process
of completing the BCA Green Mark GoldPlus recertification
by April 2021.
FCT completed the acquisition of the remaining interest
in AsiaRetail Fund Limited (“ARF”) which it does not
own on 27 October 2020. FCT now owns 100% of ARF
portfolio, consisting of five retail properties and one
office building. Of these properties, three retail properties
(Tiong Bahru Plaza, Century Square and White Sands)
and the office building (Central Plaza) have achieved BCA
Green Mark Platinum certification, and Tampines 1 is BCA
Green Mark GoldPlus certified. The remaining property,
Hougang Mall will be scheduled for green certification in
due course.
An internal audit process has been established to conduct
independent appraisal and assurance of the adequacy
and effectiveness of the Manager’s existing processes
and controls. This internal audit function sits within the
Frasers Property Group2.
FCT submitted its second GRESB Real Estate Assessment
this year and achieved an average GRESB Score of 69
points and attained a 3-Star status. The GRESB average
score is 70. We endeavour to improve our score in the
next submission through the various initiatives that have
been identified in the forthcoming year.
In FY2020, we are pleased to report that there were
no known incidents of breaches of any relevant laws
and regulations including environmental laws and
regulations, bribery and corruption and marketing
communication. We strive to maintain our performance
in FY2021.
RESPONSIBLE INVESTMENT
Sustainability provides our business with a competitive
edge, a critical factor to remain ahead of our peers and
create value for both our business and Unitholders in
the long-term. We believe that sustainability not only
responds to the growing demands of our stakeholders,
but also enhances the return on our investments.
RESILIENT PROPERTIES
Evidence has shown that climate change-related events
are increasingly impacting organisations globally.
Investors are also increasingly aware and are now putting
more weight on climate resilience and sustainability as
part of their investment decision making process. It is
critical to understand the likelihood and consequence
of future climate events to understand and manage the
risks to business operations. We need to be strategic
and systematic in responding to the impacts of
climate change.
2
Please refer to page 127 of this Annual Report for more information on internal audit.
Contents
8 6 / F R A S E R S C E N T R E P O I N T T R U S T
ACTING
PROGRESSIVELY
Frasers Property Group started disclosing in FY2019
its sustainability progress which is aligned to the Task
Force on Climate-Related Financial Disclosures (TCFD).
As part of the Group, FCT aims to carry out climate risk
assessments and implement asset-level adaptation
and mitigation plans in line with the TCFD framework
by 2024.
In FY2020, we have started to embark on the risk
assessment journey together with Frasers Property
Retail. We seek to identify the risks and opportunities and
develop a strategic approach to managing the physical
and transitional risks associated with climate change for
our business.
To read more on our journey and progress together with
the Group, refer to the ‘Resilient Properties’ section in
Frasers Property Limited’s Sustainability Report FY2020.
INNOVATION
As a business, we are constantly innovating to
remain relevant to our stakeholders – our employees,
customers, tenants, communities and investors, while
future-proofing our organisation. The retail industry
is experiencing rapid changes and disruptions with
emerging technologies and transition of traditional retail
to digital e-commerce. The transition was expedited
exponentially during the outbreak of COVID-19, where
businesses are compelled to convert their businesses
online to stay in operation.
It is important to create an ecosystem where innovation
thrives, organically and through strategic partnerships.
To facilitate this, the Group has encouraged its employees
to undertake training in design thinking which will
equip them with the knowledge and skills to lead and
implement ideation within our business to drive a
customer centric and collaborative mindset.
Makan Master app, a digital
F&B concierge app
Frasers e-Store on the Frasers Experience FRx app
Towards Omnichannel Retail
During the year, we have implemented several key
innovative projects together with Frasers Property Retail
to strengthen our position as one of the leading retail
players in the industry. The Makan Master app, a digital
F&B concierge app first launched by Frasers in 2018
for pre-ordering of F&B, was given a feature boost in
September 2020. The new feature on the Makan master
app now allows consumers to aggregate orders from
up to three F&B outlets within the same mall in one
delivery order. This new feature provides consumers
with flexibility and convenience when ordering food and
saves them fees and time by aggregating orders in one
delivery. For the F&B tenants, it allows them to get onto
the digital bandwagon with no hassle and extend their
catchment on the digital space. There are more than 100
F&B tenants on board the Makan Master platform.
In conjunction with the feature upgrade of Makan Master,
Frasers Property Retail is also rolling out the Frasers
e-Store this year. The Frasers e-Store is an e-commerce
market place to provide seamless store-to-door shopping
experience for consumers on the Frasers Experience
FRx app. Similar to the enhanced feature on the Makan
Master described earlier, consumers can aggregate order
from multiple tenants in a mall and have their package
delivered to their doorstep, all within the FRx app.
Purchases made through the e-Store may be used to earn
Frasers Points with every minimum spend of S$10, which
can be redeemed for Carpark$ to offset their parking fees,
Digital Gift Cards, eVouchers and exclusive deals from the
FRx app.
The enhanced Makan Master and the Frasers e-Store
are examples of how we have tapped on the innovation
of our people to drive solutions that can strengthen
the connection and relevance of our business to our
consumers, and to underpin the resilience of our business
and assets.
A N N U A L R E P O R T 2 0 2 0 / 8 7
CONSUMING
RESPONSIBLY
Climate change is a global challenge and Singapore as a nation has pledged to
reduce emissions intensity by 36% below 2005 levels by 20303. As owner and
manager of retail malls in Singapore, our role is critical in contributing to this
cause. We strive to continuously improve our resource consumption by enhancing
our building efficiencies and promoting sustainable practices. We are constantly
engaging our employees and tenants to collectively manage our environmental
footprint.
OUR APPROACH
• Establish policies that promote responsible consumption of resources across our properties
• Adopt practices that drive efficient use and management of natural resources
• Foster a culture of collaboration to promote responsible consumption among our stakeholders
OUR PROGRESS
Focus Areas
Our Goals
Our Progress in FY2020
Contribution
to UNSDGs
Energy &
Carbon
• To achieve net zero carbon by 2050.
• To develop a net zero carbon
roadmap and establish progressive
carbon reduction targets by FY2021.
Water
• To reduce water use intensity by 20%
from 2015 by 2030 and establish
interim targets by FY2021.
• FCT has started the process of collating
carbon inventory from its properties
together with Frasers Property Retail.
• Achieved 12.5% of GHG emissions
intensity reduction from FY2019.
• Achieved 10.3% of energy use intensity
reduction from FY2019.
• Solar photovoltaic installed at Changi
City Point to power all billboard
lightings at the rooftop.
• Achieved 17.7% of water usage
intensity reduction from FY2019.
Waste
• To develop a general waste and
• A total of 565 tonnes of waste was
recycling program, a partnership
with tenants under the green lease
initiative.
recycled during the year.
• All FCT’s properties have e-waste
recycling bins to encourage electronic
waste recycling. A total of 9.6 tonnes
of e-waste was collected in FY2020.
• Reverse Vending machines have been
set up to encourage recycling of used
bottles and cans at YewTee Point and
Northpoint City. A total of 364,318
bottles and cans were collected in
FY2020.
3
Singapore’s Climate Action Plan: Take Action Today, for a Carbon-Efficient Singapore, 2016.
Contents
8 8 / F R A S E R S C E N T R E P O I N T T R U S T
CONSUMING
RESPONSIBLY
ENERGY AND CARBON
As much as 39% of the global energy-related carbon
emissions are caused by buildings and construction with
28% of emissions resulting from building operations4.
Recognising this, together with the Group, we are
working towards decarbonising our business and
achieving carbon neutral by 2050. Our strategies
include improving asset energy efficiencies and active
engagement with our tenants on energy management.
In our efforts to ensure that our properties are operating
at optimum efficiency, we conduct energy audits across
our properties strategically to identify energy efficiency
improvement opportunities. Additionally, our properties
that are BCA Green Mark certified are subjected to energy
audits every three years to ensure that the building
systems are operating efficiently.
In FY2020, our total energy consumption was 38.6 GWh,
with overall building energy intensity of 189 kWh/m2.
Although total consumption increased by 3.3% compared
to FY2019, the energy intensity reduced by a significant
10.3%. Similarly, our greenhouse gas (GHG) emissions
was increased to 15,757 tCO2e, while the GHG emissions
intensity dropped to 77.2 kgCO2e/m2. This represents
a reduction of 12.5% year-on-year from 88.2 kgCO2e/
m2.The increase in energy consumption is attributed to
the acquisition of Waterway Point last year. However,
as a result of the COVID-19 Circuit Breaker in Singapore,
the energy and GHG emissions intensities were
significantly reduced.
GENERATING RENEWABLE ENERGY ON-SITE
As part of our strategy to reduce reliance on fossil-
fuel based energy, we have started to explore
opportunities to incorporate use of renewable energy
on-site. During the year, Changi City Point installed
a total of 1,800W of solar photovoltaic (PV) panels
at the property. The energy generated was used
to power all 62 billboard lights located at the roof
garden. It is estimated that the solar PV generates
approximately 220 kWh of electricity monthly.
We will continue to seek for opportunities to improve our
energy use and building efficiencies in the coming year.
WATER
Water scarcity is an issue afflicting every continent and
water use has been growing exponentially, past the
limit at which water can be sustainably delivered5. The
challenges are projected to intensify due to increasing
extreme climate events. It is our priority to effectively
manage our water use through various water reduction
initiatives including using recycled water for non-potable
purposes. We also invest in water saving fittings as part
of our commitment to enhance our water resilience in
the future.
Electricity Consumption (GWh)
Energy Intensity (kWh/m2)
37.3
38.6
201
211
189
29.8
FY2018
FY2019
FY2020
FY2018
FY2019
FY2020
Scope 2 GHG Emissions (‘000 tonnes of CO2e)
Scope 2 GHG Intensity (kgCO2e/m2)
12.5
15.6
15.8
84.4
88.2
77.2
FY2018
FY2019
FY2020
FY2018
FY2019
FY2020
4 World Green Building Council, https://www.worldgbc.org/worldgreenbuildingweek
5 UN Water, https://www.unwater.org/water-facts/scarcity/
A N N U A L R E P O R T 2 0 2 0 / 8 9
Water Consumption (million m3)
Water Intensity (m3/m2)
0.49
0.56
0.52
3.08
3.11
2.56
FY2018
FY2019
FY2020
FY2018
FY2019
FY2020
To drive our commitment, we have set our goal to reduce
water use intensity by 20% from 2015 by 2030 and we
are working towards establishing interim targets by
FY2021. All our properties are awarded the Public Utility
Board (“PUB”) Water Efficient Building (WEB) Certification,
a testament of our efforts towards water conservation.
We also consume NEWater as part of our water reduction
initiative. NEWater is reclaimed water treated for safe
consumption through advanced membrane technology.
In FY2020, we consumed a total of 0.28 million m3 of
NEWater.
During the year, the total water6 consumed across our
properties was 0.52 million m3 with water intensity of
2.56 m3/m2, a decrease of 17.7 % from last year. The
reduction in consumption was attributed to the
significant reduction in shopper traffic at the malls due to
the Circuit Breaker and traffic control measures imposed
by the authorities..
WASTE
Waste generation is a large part of the retail industry and
at FCT, we are committed to encouraging waste reduction
and increasing our recycling rates by diverting waste
from landfill. Waste management is pivotal to realising
our objective of reducing waste generation. We also
encourage the 3Rs practice – Reduce, Reuse and Recycle
across our properties and we do this by actively
engaging our customers and tenants in our waste
management agenda.
At our properties, waste disposal and recycling activities
are tracked. During the year, the total waste generated
from our properties decreased to 9,811 tonnes,
equivalent to a 2.2 % reduction year-on-year. A total of
565 tonnes of waste was sent for recycling while the
remaining was directed to Singapore’s waste-to-energy
plants. As with energy and water, waste generation
decreased resulting from the impact of the COVID-19
outbreak.
As part of our commitment to encourage recycling
amongst our customers and tenants, we continue to
partner with Starhub and Frasers and Neave (F&N) to
collect e-waste, plastic bottles and aluminium cans.
Dedicated recycling bins are strategically placed within
our malls for tenants and shoppers to drop recyclable
items. In FY2020, we have successfully collected a total of
9.6 tonnes of e-waste and 364,318 used bottles and cans.
Shoppers are rewarded with F&N discount vouchers for
every four plastic bottles or aluminium cans during the
campaign.
We are working on developing a general waste and
recycling program and establishing partnerships with
tenants through our green lease initiative in the coming
year to further progress our waste management
practices.
Waste Consumption (‘000 tonnes)
Waste Intensity (kg/m2)
7.8
10.0
9.8
54.2
55.9
48.1
FY2018
FY2019
FY2020
FY2018
FY2019
FY2020
6 Water consumed from PUB, municipal water supply.
Contents
9 0 / F R A S E R S C E N T R E P O I N T T R U S T
FOCUSING ON
PEOPLE
Our people are the driving force behind our business’ success. Creating a diverse,
equal and safe workplace is key to driving employees to perform in their work
and feel a sense of achievement. It is also our priority to support and protect
the interests and well-being of our people – employees, tenants, customers and
communities through our business and community investments.
OUR APPROACH
• Develop policies that drive human capital development and positive impacts in communities
• Adopt fair employment practices and invest in equipping employees with relevant skills
•
Invest in activities and programmes to support community development
OUR PROGRESS
Focus Areas
Our Goals
Our Progress in FY2020
Contribution
to UNSDGs
Diversity and
Inclusion
• To embed diversity and inclusion in our
culture through employee engagement.
• To provide training and education that
raises employee awareness of diversity
and inclusion and associated benefits.
• To enhance processes and policies to
encourage greater flexibility
and diversity.
Skills and
Leadership
• To achieve an average training hours of
40 hours per employee per year.
• To train all our employees on
sustainability by 2021, and extend to
our supply chain and other stakeholders
after 2021.
• FCT is aligned with the Sponsor’s pledge to
the United Nations Women Empowerment
Principles.
• FCT adopted and put in practice the Group
Diversity & Inclusion Policy at its workplace.
• FCT achieved 38 average training hours per
employee in FY2020. We will strive to meet
the target in FY2021.
• 100% of the REIT Manager’s employees
have undergone sustainability-related
trainings in FY2020.
Health and
Well-being
• To transform our workplace by building
• The REIT Manager’s employees now
a wellness culture that positively
engages our people.
• To create awareness of health
management, provide support to
harness mental wellness and foster a
connected workforce.
have access to the Employee Assistance
Programme launched by Frasers Property
Group in Singapore.
• Implemented OHSAS 18001 and SS506
Part 1:2009 occupational health and
management system at FCT’s properties.
• To create a safe working environment
• There was one reported injury reported at
and achieve zero injuries.
Changi City Point in FY2020. Our target is to
have zero injuries and we will work towards
this goal.
• To conduct tenant engagement
programs at least once a year for each
property by FY2021
• Developed a tenant engagement plan
for FY2021to be implemented at FCT’s
properties.
• To conduct tenant satisfaction survey
Community
Connectedness
• To seek meaningful long-term
relationships that respect local cultures
and create lasting benefits.
• To identify measurements to
understand how we are making a
positive contribution.
• Achieved 92.8% participation rate. 66%
of the respondents rated “Satisfied” or
“Very Satisfied”.
• FCT adopted and implemented the Group
Corporate Social Responsibility Policy.
• FCT adheres to the Group’s newly launched
Community Investment Framework that
provides a basis for influencing change and
decisions in a coordinated way.
• A total of 4.7 tonnes of foodstuff collected
and donated to Food Bank for communities
with food security issues.
• S$27.4 million in rental rebates through our
Tenant Support Package to our tenants.
A N N U A L R E P O R T 2 0 2 0 / 9 1
DIVERSITY AND INCLUSION
Having a diverse and inclusive workforce is integral to our business culture and identity. We value the strengths that
diversity brings – experiences, perspectives and cultures which enable us to realise our shared value of ‘experience
matters’ and contributes positively to the performance of our business.
We are committed to fair and equal opportunities to all our employees. Together with our Sponsor, we are a signatory
to the Tripartite Alliance for Fair & Progressive Employer Practices (“TAFEP”) in Singapore and a member of Singapore
National Employer Federation. On top of that, we continue to practice an open appraisal system for all employees of
the Manager and reward based on merit.
This year, the Group instituted a Diversity and Inclusion Policy, to reinforce our commitment to creating a diverse and
inclusive workplace. The policy defines Frasers Property’s beliefs and actions to support a diverse workplace and how
we assess our performance in delivering these actions. FCT’s approach is aligned to the policy and we aim to further
embed diversity and inclusion in our culture through regular employee engagement.
FCAM’s Employee Profile
Employee Breakdown by Gender and Age Group
By Gender
By Age
FY2020 FY2019
Female
Male
58%
42%
56%
44%
FY2020
FY2019
FY2020 FY2019
< 30 Years Old
30-50 Years Old
> 50 Years Old
5%
79%
16%
6%
72%
22%
FY2020
FY2019
New Hires by Gender and Age Group
New Hires by Gender
FY2020
New Hires by Age
FY2020
FY2020 FY2019
Female
100%
0%
Male
0% 100%
FY2019
FY2020 FY2019
< 30 Years Old
0%
30-50 Years Old 100%
> 50 Years Old
0%
0%
50%
50%
FY2019
Turnover by Gender and Age Group
Turnover by Gender
FY2020
Turnover by Age
FY2020
FY2020 FY2019
Female
0%
0%
Male
0% 100%
FY2019
FY2020 FY2019
< 30 Years Old
30-50 Years Old
0%
0%
0%
0%
> 50 Years Old
0% 100%
FY2019
Contents
9 2 / F R A S E R S C E N T R E P O I N T T R U S T
FOCUSING ON
PEOPLE
As at 30 September 2020, FCT has a total of 19 full-
time employees7. The majority of the workforce, 79%
falls within the age group of 30-50 years old. We have
58% of female employees within the REIT Manager’s
workforce. During the year, the REIT Manager hired one
new employee, representing hiring rate of 5% with no
employee turnover. All employees are based in Singapore.
Our employees’ satisfaction is important to us and we
conducted our first employee satisfaction survey last
year. The purposes of this year’s survey is to gather
feedback on work-life balance and concerns, especially
from the impact of COVID-19 and work from home
arrangements. Through this year’s survey, we achieved
100% survey response rate. We also want to gauge the
well-being of our colleagues and to get feedback on what
improvements we can make. The survey outcome shows
the following highlights:
• There is strong concurrence with Frasers’s corporate
values: collaborative, respectful, progressive and real.
• There is a strong connections with FCT’s success and
achievements – this was also reflected in the previous
year’s survey results
• Everyone has someone to talk to when they encounter
problems at work
• Most colleagues felt well supported by the company
during COVID-19
The areas that require improvements were:
• 6 out of 21 or 29% responded they cannot find time for
training compared with 11% last year
• Employees felt there was a compromise of well-being
due to increasing workload and mental stress
from work. Working from home (WFH) is the top
work-related concern
We shared the survey summary with our Group HR
and they will be following up with initiatives on
company level that addresses some of the concerns. At
present, Group HR has an existing Employee Assistance
Programme that provides employees with access to
counselling sessions should they feel stressed or need an
outlet to cope with stress. Other actions being worked
on include improving work flow that allows e-approvals,
Flexible Work Arrangements (FWA) when employees
return to office and cultivating a healthy WFH culture.
Some of these initiatives are planned to be rolled out in
end 2020 or early 2021.
SKILLS & LEADERSHIP
An agile and adaptive workforce strengthens the
competitiveness and resilience of our business. We are
committed to equipping our employees with the relevant
skills and knowledge to tap into their full potential. In
a rapidly evolving industry, it is key to ensure that our
employees are continuously learning and developing to
future-proof our business.
As part of the Frasers Property Group, our learning and
development programmes are supported by the Group’s
in-house Learning Academy which was established since
2017. The Learning Academy provides a comprehensive
range of Learning and Development programmes
including trainings which are tailored to the needs of
the employees.
This year, due to disruption caused by COVID-19,
the Learning Academy made learning accessible to
all employees through remote learning with Virtual
Instructor-Led Training (VILT), webinars and self-
paced e-learning. An online global Learning Festival
with over 40 virtual live sessions was also held to
promote continuous learning. The nine-days festival
centred around ‘Learning for the Future’ with subject
matter experts from both internal and external of our
organisation sharing valuable insights on relevant topics.
During the year, we recorded a total of 719 hours
of training for all employees, averaging to 38 hours
per employee. This is a decrease of 33% compared
to FY2019, impacted by the COVID-19 outbreak. We
endeavour to meet the Group’s target of 40 training
hours per employee in the coming year. In FY2020,
we have started tracking the number of employees
attending sustainability-related training. We are pleased
to report that all of the REIT Manager’s employees have
undertaken sustainability-related training such as net
zero carbon and climate risk and resilience in FY2020.
In the coming year, we hope to continue to train our
employees on sustainability-related topics.
FCT Average Training Hours
FCT Training Hours and
Training Per Employee by Gender
58
56
39
38
26
24
65
50
43
30
FY2019
FY2020
FY2019
FY2020
FY2019
FY2020
FY2019
FY2020
Executive
Non-Executive
Total
Male • Female
7 All employee data disclosed in this report is in relation to the REIT Manager.
A N N U A L R E P O R T 2 0 2 0 / 9 3
SAVING A LIFE WITH OUR QUICK ACTIONS
In September 2020, a customer service officer and two security
officers saved one cleaner’s life at YewTee Point. The team
performed cardiopulmonary resuscitation (CPR) and mouth-to-
mouth resuscitation on the cleaner who had suffered a heart
attack. They also used the Automated External Defibrillator
(AED) to revive the victim while awaiting the arrival of the
ambulance. Thanks to their quick actions and first-aid skills,
the cleaner was saved and has since been discharged from the
hospital. In recognition of their courage, the Singapore Civil
Defence Force (SCDF) presented the team with the Community
First Responder Award.
HEALTH AND WELL-BEING
Health, safety and well-being are integral to FCT and it is
of our top priority to provide a safe environment for our
employees, tenants, customers and other stakeholders.
We believe that we can create places that are people and
safety-focused. Furthermore, we have in place policies
and procedures to manage and improve health and safety
at the workplace. We are also committed to promote
the well-being of our employees through well-being
engagement programmes.
As part of our commitment to health and safety, our
properties have implemented OHSAS 18001 and SS506
Part 1:2009 occupational health and management
system. Additionally, we adopt the Group’s Workplace
Health and Safety Policy to align with the Group’s
direction. Our properties are also ‘BizSAFE Level Star’
certified by the Workplace Safety and Health Council.
During the year, we recorded one lost-time injury with
a lost-time injury rate of 0.7 and severity rate of 8.7. A
cleaner at Changi City Point unfortunately slipped and
fell. The cleaner was given the medical attention required
and has since recovered.
Additionally, we recorded zero fatalities in FY2020 and
were also compliant to the health and safety regulations
at our properties with no recorded breaches during the
year. We endeavour to improve our health and safety
measures and strive to achieve zero incidents of injury
and fatality in the coming year.
We also actively encourage our employees to maintain
their wellness by participating in the Group Corporate
Wellness programmes held throughout the year. Due to
the impact of COVID-19, most of the programmes were
conducted online to encourage our employees to remain
active even when working from home.
Ensuring Health and Well-being over the COVID-19
Pandemic
With a portfolio of seven properties across Singapore, we
recognise the critical role we play as owner and manager
of places where communities congregate. Measures were
taken to enhance our health and safety practices during
and after operational hours.
Our properties adapted and coordinated action plans
in line with the government’s direction to ensure the
health and safety of our people and communities through
compliance to government orders, guidelines and health
advisories on COVID-19.
We implemented twice daily temperature taking for
staff and conducted temperature screening for visitors
in our malls. Shoppers are reminded to comply with
health advisory guidelines through notices placed at mall
entrances. To guide shoppers to practice safe distancing,
markers were placed on the floors at various locations.
We also increased the frequency of disinfection for areas
with high traffic. PhotoPlasma air and surface disinfecting
units were installed in restrooms and lifts to complement
our cleaning efforts. We are also the first mall operator in
Singapore to roll out made-in-Singapore UV Disinfecting
autonomous mobile robots – called Sunburst UV Bots.
Each UV Bot is equipped with a camera, built-in sensors,
software, and an ultraviolet-C light module that emits
powerful UV-C rays to eradicate viruses.
All our properties are SG Clean certified, a recognition
of our commitment to the highest standards of
environmental public hygiene maintained at our
properties. It is also a testament to our commitment
to safeguarding the health of the public within our
properties.
In preparation for our tenants’ phased reopening, we
circulated a ‘Welcome Back’ tenant partner information
kit to outline the precautionary measures we have
taken at our properties and expectations on the tenants’
sanitation and maintenance of their premises. As part of
our engagement, we also encouraged tenants to apply
for SG Clean certification to boost public confidence in
their business.
Contents
9 4 / F R A S E R S C E N T R E P O I N T T R U S T
FOCUSING ON
PEOPLE
Safety measures
COMMUNITY CONNECTEDNESS
We are committed to enriching the communities by
creating places for good and thrive. FCT emphasises
on making meaningful contributions for communities
to ensure that they grow alongside our business, build
long-lasting relationships and create lasting impacts. We
seek partnerships with local communities and non-profit
organisations to plan this journey together.
Our approach towards philanthropy and volunteering
activities are guided by the newly-launched Community
Investment Framework by the Sponsor. It sets the
foundation for FCT to make informed decisions and
influence change in the community. The Framework
prioritises three focus areas – Environment, Health
and Education as key areas where we would like to make
the greatest positive impact in the communities we
operate in.
Health
As part of Frasers Property Retail, we launched a food
collection drive across our properties in collaboration
with our long-term partner, Food Bank Singapore. The
main objective of the campaign was to tackle hunger
issues while reducing food waste. We collected non-
perishable food stuff to be donated to those facing food
insecurity. Donors were rewarded with S$5 Frasers Retail
digital gift cards when they donate a minimum of five
items. Throughout the campaign, Frasers Property gave
out over S$63,600 worth of digital gift cards and point
rewards. Additionally, we have an ongoing collaboration
with Food Bank to collect foodstuff for donation through
strategically placed collection bins across our malls.
In FY2020, we successfully collected a total of 4,686 kg
of food to be donated to communities with food
security issues.
UV bot
We also partner with various organisations such as
Health Promotion Board and Cancer Prevention Society
to organise campaigns and roadshows at our malls
throughout the year. One of the key campaigns held in
collaboration with Health Promotion Board was the ‘Eat,
Drink, Shop Healthy’ Campaign. The campaign aimed
to raise awareness on healthy eating habits among
shoppers. We provided venue space and promoted the
event through our ad spaces and social media.
Education
Education is an important factor in driving change and
raising awareness among the community. We strive to
empower the community through knowledge on various
topics such as crime prevention, first-aid skills and
recycling. At Anchorpoint, a one-day Crime Prevention
Engagement was held in partnership with the Singapore
Police Force to educate the public on crime prevention.
Together with Singapore Heart Foundation, a two month-
long Hands-only CPR Challenge was held in November
2019. The challenge aimed to improve CPR skills within
the community. Interactive CPR kiosks were placed in the
mall as a strategy to engage shoppers on CPR.
A N N U A L R E P O R T 2 0 2 0 / 9 5
SGUnited Info Kiosk
Mask distribution
Contributing to SGUnited
In partnership with Workforce Singapore and Marsiling
Constituency Office, Causeway Point hosted the SGUnited
Info Kiosk at the mall’s atrium. This three-day roadshow,
which commenced on 13 September 2020, provided the
visitors to the kiosk information on the 100,000 jobs,
traineeships and skills upgrading opportunities to be
created under the SGUnited Jobs and Skills Package.
Caring for our tenants and frontline colleagues
Together with Frasers Property Retail, we distributed
masks to over 1,300 tenants and frontline workers
across all our properties. The masks were purchased
through our US$50,000 upfront commitment to Razer,
a local firm that converted its manufacturing line to
meet the shortage of masks at the peak of the outbreak.
Following that, we provided retail spaces across all our
properties for the deployment of Razer’s mask vending
machine for citizens to claim their free mask under
the #ForSingaporeansBySingaporeans initiative. We
also handed out care kits to the frontline teams at our
properties in appreciation of their dedication to ensure
that our staff and customers have a safe environment to
live, work and play in.
Contents
Razer’s mask vending machine
Community
Tenant Support Package during COVID-19
Frasers Property Retail and Frasers Centrepoint Trust
rolled out two Tenant Support Packages (the “TSP”) in
February 2020 and March 2020 to help their tenants
across the Group’s retail properties in Singapore cope
with the cashflow and business disruptions as the
COVID-19 situation evolved. The initial TSP comprised
full pass-on of the 15% property tax rebate to tenants,
flexible opening hours, enhanced marketing programs
to drive traffic. However, as the COVID-19 situation
heightened, the Group announced a S$45 million rental
rebate for its tenants. This was followed by the Group’s
adherence to the Government’s Rental Relief Framework
which mandated commercial landlords to provide two
months of rental rebates to match the same amount by
the Government. The total amount of rental rebates from
FCT as at end of FY2020 was S$27.4 million.
9 6 / F R A S E R S C E N T R E P O I N T T R U S T
ABOUT
THIS REPORT
This is FCT’s sixth Sustainability Report and this report discloses FCT’s Environmental, Social and
Governance (ESG) performance for all FCT properties during the period from 1 October 2019 to
30 September 2020 (“FY2020”).
This report has been prepared in accordance with the sustainability reporting requirements set out in the
SGX-ST Listing Manual (Rules 711A and 711B) and continue to prepare the Report in accordance with the
GRI Standards (2016): Core Option.
REPORT SCOPE
Data disclosed in this Sustainability Report covers all properties owned by FCT8 during the year under
review, in Singapore unless stated otherwise. The employee related information disclosed refer to the
activities and performance of Frasers Centrepoint Asset Management (the “Manager” or “FCAM”). As
the Manager of FCT, FCAM strives to support sustainability efforts by encouraging good sustainability
practices at our properties. We have also included health & safety data of our contractor’s employees
working at our properties, where applicable.
The contents within this report has been disclosed in good faith and to the best of our knowledge.
Together with the other information set out in our Annual Report, this Sustainability Report provides a
comprehensive and transparent reporting to our stakeholders.
FEEDBACK
We are always looking to improve our sustainability efforts and we welcome your feedback.
Please contact:
Mr Chen Fung Leng
Vice President, Investor Relations
Frasers Centrepoint Trust
Email: fungleng.chen@frasersproperty.com
8
FCT owns seven properties including Causeway Point, Waterway Point, Northpoint City, Changi City Point, YewTee Point, Anchorpoint and Bedok Point.
A N N U A L R E P O R T 2 0 2 0 / 9 7
GRI
CONTENT INDEX
GRI Standards
2016
Disclosure
Number
Disclosure
Title
Section and Page Reference / Notes
Universal Standards
GRI 102:
General Disclosures
Organisational Profile
102-1
102-2
102-3
102-4
Name of the organisation
Frasers Centrepoint Trust
Activities, brands, products,
and services
About Frasers Centrepoint Trust (Pg 2)
Location of headquarters
Corporate Information (inside back cover)
Location of operations
About Frasers Centrepoint Trust (Pg 2)
102-5
Ownership and legal form
About Frasers Centrepoint Trust (Pg 2)
Structure of Frasers Centrepoint Trust (Pg 3)
Structure of Frasers Centrepoint Trust (Pg 3)
102-6
102-7
Markets served
FCT Portfolio Overview (Pgs 50-66)
Scale of the organisation
About Frasers Centrepoint Trust (Pg 2)
Financial Review (Pgs 30-31)
Focusing on People – Diversity and Inclusion
(Pgs 91-92)
102-8
Information on employees and
other workers
Focusing on People – Diversity and Inclusion
(Pgs 91-92)
102-9
Supply chain
Consuming Responsibly (Pgs 87-89)
102-10
102-11
Significant changes to
organisation and its supply
chain
Precautionary principle or
approach
102-12
External initiatives
102-13
Membership of associations
Managing Sustainability – Stakeholder
Management (Pgs 80-81)
About This Report – Report Scope (Pg 96)
FCT does not specifically refer to the
precautionary approach when managing risk;
however, our management approach is risk-
based, and underpinned by our internal audit
framework.
Managing Sustainability – Stakeholder
Management (Pgs 80-81)
Acting Progressively – Responsible Investment
(Pg 85)
Managing Sustainability – Stakeholder
Management (Pgs 80-81)
Managing Sustainability – Industry Alignment
(Pg 82)
Strategy
102-14
Statement from senior
decision-maker
Board Statement (Pg 76)
Ethics and Integrity
102-16
Values, principles, standards,
and norms of behaviour
Acting Progressively – Risk-based Management
(Pg 85)
Contents
9 8 / F R A S E R S C E N T R E P O I N T T R U S T
GRI
CONTENT INDEX
GRI Standards
2016
Disclosure
Number
Disclosure
Title
GRI 102:
General Disclosures
Governance
102-18
Governance structure
Stakeholder Engagement
102-40
List of stakeholder groups
102-41
102-42
102-43
Collective bargaining
agreements
Identifying and selecting
stakeholders
Approach to stakeholder
engagement
Section and Page Reference / Notes
Structure of FCT and Organisation Structure of
the Manager (Pg 3)
Board of Directors (Pgs 16-19)
Trust Management Team (Pgs 20-21)
Corporate Governance Report (Pgs 101-136)
Managing Sustainability – Sustainability
Governance (Pg 80)
Managing Sustainability – Stakeholder
Management (Pgs 80-81)
There are no collective bargaining agreements
in place.
Managing Sustainability – Stakeholder
Management (Pgs 80-81)
Managing Sustainability – Stakeholder
Management (Pgs 80-81)
102-44
Key topics and concerns raised Managing Sustainability – Stakeholder
Management (Pgs 80-81)
Reporting Practice
102-45
Entities included in the
consolidated financial
statements
102-46
Defining report content and
topic Boundaries
102-47
List of material topics
102-48
Restatements of information
Structure of Frasers Centrepoint Trust (Pg 3)
Notes to the Financial Statements (Pgs 154-211)
About This Report – Report Scope (Pg 96)
Our Sustainability Framework (Pg 79)
Managing Sustainability – Stakeholder
Management (Pgs 80-81), Materiality
Assessment (Pg 83)
Managing Sustainability – Materiality
Assessment (Pg 83)
Consuming Responsibly – Energy & Carbon,
Water (Pgs 88-89)
Restatement due to change in reporting
practice in alignment with the Group.
102-49
102-50
102-51
102-52
102-53
102-54
102-55
102-56
Changes in reporting
None
Reporting period
About This Report (Pg 96)
Date of most recent report
December 2019
Reporting cycle
Annual
Contact point for questions
regarding the report
Claims of reporting in
accordance with GRI Standards
About This Report – Feedback (Pg 96)
About This Report (Pg 96)
GRI content index
GRI Content Index (Pgs 97-100)
External assurance
We have not sought external assurance on this
data; however we intend to review this stance
in the future.
Management Approach
GRI 103:
Management
Approach
103-1
Explanation of the material
topic and its boundary
Managing Sustainability – Materiality
Assessment (Pg 83)
A N N U A L R E P O R T 2 0 2 0 / 9 9
GRI Standards
2016
Disclosure
Number
Disclosure
Title
Topic-specific Standards
Economic Performance
Section and Page Reference / Notes
GRI 103:
Management
Approach
GRI 201:
Economic
Performance
Anti-corruption
GRI 103:
Management
Approach
GRI 205:
Anti-corruption
103-2
103-3
201-1
103-2
103-3
205-3
Environmental Compliance
GRI 103:
Management
Approach
GRI 307:
Environmental
Compliance
Ethical Marketing
GRI 103:
Management
Approach
GRI 417:
Marketing and
Labelling
Energy Management
GRI 103:
Management
Approach
GRI 302:
Energy
GRI 305:
Emissions
103-2
103-3
307-1
103-2
103-3
417-3
103-2
103-3
302-1
302-3
305-2
The management approach
and its components
Business Objectives and Growth Strategies
(Pg 4)
Evaluation of the management
approach
Direct economic value
generated and distributed
Financial Review (Pgs 30-33)
Financial Statements (Pgs 137-211)
The management approach
and its components
Acting Progressively – Risk-based Management
(Pg 85)
Evaluation of the management
approach
Confirmed incidents of
corruption and actions taken
The management approach
and its components
Acting Progressively – Risk-based Management
(Pg 85)
Evaluation of the management
approach
Non-compliance with
environmental laws and
regulations
The management approach
and its components
Acting Progressively – Risk-based Management
(Pg 85)
Evaluation of the management
approach
Incidents of non-compliance
concerning marketing
communications
The management approach
and its components
Consuming Responsibly – Energy & Carbon
(Pg 88)
Evaluation of the management
approach
Energy consumption within
the organization
Energy intensity
Energy indirect (Scope 2) GHG
emissions
305-4
GHG emissions intensity
Water Management
GRI 103:
Management
Approach
103-2
103-3
The management approach
and its components
Evaluation of the management
approach
GRI 303:
Water
303-1
Water withdrawal by source
Consuming Responsibly – Water (Pgs 88-89)
Contents
1 0 0 / F R A S E R S C E N T R E P O I N T T R U S T
GRI
CONTENT INDEX
GRI Standards
2016
Disclosure
Number
Disclosure
Title
Staff Retention and Development
Section and Page Reference / Notes
GRI 103:
Management
Approach
GRI 401:
Employment
GRI 404:
Training and
Education
103-2
103-3
401-1
404-1
404-2
404-3
The management approach
and its components
Focusing on People – Diversity & Inclusion
(Pgs 91-92)
Evaluation of the management
approach
Focusing on People – Skills & Leadership (Pg
92)
New employee hires and
employee turnover
Focusing on People – Diversity & Inclusion
(Pgs 91-92)
Average hours of training per
year per employee
development reviews
Programs for upgrading
employee skills and transition
assistance programs
Percentage of employees
receiving regular performance
and career development
reviews
Focusing on People – Skills & Leadership (Pg
92)
Focusing on People – Skills & Leadership (Pg
92)
Focusing on People – Diversity & Inclusion
(Pg 91)
Labour/Management Relations
GRI 103:
Management
Approach
GRI 402:
Labour/ Management
Relations
Health and Safety
GRI 103:
Management
Approach
GRI 403:
Occupational Health
and Safety
Local Communities
GRI 103:
Management
Approach
GRI 413:
Local Communities
Additional Disclosure
Effluents and Waste
GRI 103:
Management
Approach
GRI 306:
Effluents and Waste
103-2
103-3
402-1
103-2
103-3
403-1
403-2
103-2
103-3
413-1
103-2
103-3
306-2
The management approach
and its components
Focusing on People – Diversity & Inclusion
(Pgs 91-92)
Evaluation of the management
approach
Minimum notice periods
regarding operational changes
This is currently not covered in Group-wide
collective agreements. The notice period varies.
The management approach
and its components
Focusing on People – Health & Well-being
(Pg 93)
FCT is represented in the Sponsor’s Health &
Safety senior management committee.
Evaluation of the management
approach
Workers representation in
formal joint management–
worker health and safety
committees
Types of injuries and rates of
injury, occupational diseases,
lost days, and absenteeism,
and number of work-related
fatalities
The management approach
and its components
Focusing on People – Community
Connectedness (Pgs 94-95)
Evaluation of the management
approach
Operations with local
community engagement,
impact assessments,
and development programs
The management approach
and its components
Evaluation of the management
approach
Waste by type and disposal
method
Consuming Responsibly – Waste (Pg 89)
A N N U A L R E P O R T 2 0 2 0 / 1 0 1
INTRODUCTION
Frasers Centrepoint Trust (“FCT”) is a real estate investment trust (“REIT”) listed on the Main Board of the Singapore
Exchange Securities Trading Limited (the “SGX-ST”). FCT is managed by Frasers Centrepoint Asset Management Ltd.
(the “Manager”), a wholly-owned subsidiary of Frasers Property Limited (“FPL” or the “Sponsor” and together with its
subsidiaries, “FPL Group”).
In line with the listing rules of the SGX-ST (the “Listing Rules”) and its obligations under the Guidelines to All Holders
of a Capital Markets Services Licence for Real Estate Investment Trust Management (Guideline No: SFA04–G07) issued
by the Monetary Authority of Singapore (“MAS”), the Manager complies with the principles of the Code of Corporate
Governance 2018 (the “CG Code”).
The practices and activities of the Board of Directors (the “Board”) and the management of the Manager (the
“Management”) adhere closely to the provisions under the CG Code.
To the extent the practices may vary from any provision of the CG Code, the Manager will explain the reason for the
variation and how the practices nevertheless are consistent with the intent of the relevant principle of the CG Code. The
Manager is also guided by the voluntary Practice Guidance which was issued to complement the CG Code and which sets
out best practices for issuers; as this will build investor and stakeholder confidence in FCT and the Manager. A summary of
compliance with the express disclosure requirements in the principles and provisions of the CG Code is set out on pages
134 to 136.
The Manager
The Manager has general powers of management over the assets of FCT. As a manager of a REIT, the Manager holds a
Capital Markets Services Licence issued by the MAS to carry out REIT management activities.
The Manager’s main responsibility is to manage FCT’s assets and liabilities for the benefit of unitholders of FCT (the
“Unitholders”). To this end, the Manager is able to set the strategic direction of FCT and make recommendations to
HSBC Institutional Trust Services (Singapore) Limited, in its capacity as trustee of FCT (the “Trustee”), on acquisitions,
divestments and enhancement of the assets of FCT. It also supervises the property manager, Frasers Property Retail
Management Pte. Ltd. and its wholly-owned subsidiary, Asiamalls Management Pte. Ltd., in its day-to-day management
of the properties within FCT’s portfolio, namely, Anchorpoint, Causeway Point, Northpoint City North Wing and Yishun
10 retail podium, YewTee Point, Bedok Point, Changi City Point, Waterway Point (40% interest), Tiong Bahru Plaza, White
Sands, Hougang Mall, Century Square, Tampines 1 and Central Plaza pursuant to property management agreements
entered into for each property. The role of the Manager includes the pursuit of a business model that sustains the growth
and enhances the value of FCT and is focussed on delivering regular and stable distributions to Unitholders. Other
functions and responsibilities of the Manager include preparing annual asset plans and undertaking regular individual
asset performance analysis and market research analysis, and managing finance functions relating to FCT (which includes
financial and tax reporting, capital management, treasury and preparation of consolidated budgets).
The Values of the Manager
1.
2.
The Manager is committed to upholding and maintaining high standards of corporate governance, corporate
transparency and sustainability, and instituting sound corporate practices and controls to facilitate the Manager’s
role in safeguarding and enhancing FCT’s asset value so as to maximise returns from investments, and ultimately
the total return to Unitholders. The Manager believes that a robust and sound governance framework is an
essential foundation on which to build, evolve and innovate a business which is sustainable over the long term
and one which is resilient in the face of the demands of a dynamic, fast-changing environment.
The Manager adheres to corporate policies, business practices and systems of risk management and internal
controls, which are designed to ensure that it maintains consistently high standards of integrity, accountability
and governance in FCT and its own daily operations.
Contents
CORPORATEGOVERNANCE REPORT 1 0 2 / F R A S E R S C E N T R E P O I N T T R U S T
3.
The Manager ensures that the business and practices of FCT are carried out in a manner that complies with
applicable laws, rules and regulations, including the Securities and Futures Act (Chapter 289 of Singapore)
(“SFA”), the listing manual of the SGX-ST (the ”SGX-ST Listing Manual”), the CG Code, the Code on Collective
Investment Schemes (the “CIS Code”) issued by the MAS (including Appendix 6 of the CIS Code, the “Property
Funds Appendix”), the trust deed constituting FCT between the Manager and the Trustee dated 5 June 2006 (as
amended and restated) (the “Trust Deed”), as well as the written directions, notices, codes and other guidelines
that the MAS and other regulators may issue from time to time.
The Board works with Management to ensure that these values underpin its leadership of the Manager.
The Manager is staffed by an experienced and well-qualified team who manage the operational matters of FCT. The
Manager is a subsidiary of FPL, a multi-national developer-owner-operator of real estate products and services across
five asset classes, namely, residential, retail, commercial & business parks, industrial & logistics as well as hospitality. The
FPL Group has businesses in Southeast Asia, Australia, Europe and China, and its well-established hospitality business
owns and/or operates serviced apartments and hotels in over 70 cities and 20 countries across Asia, Australia, Europe,
the Middle East and Africa.
As the Sponsor holds a substantial ownership stake of approximately 41.05% in FCT, there is an alignment of interests
between the Sponsor, the Manager and the Unitholders. The Manager is able to benefit from and leverage on its
association with the Sponsor in the management of FCT in various ways, including tapping on the Sponsor’s extensive
experience in development and management of real estate assets, sourcing for talent and experienced personnel within
the Sponsor pool of employees, including those who may be considered for appointment to the Board, access to the FPL
Group’s network of lenders for debt financing, and negotiating for favourable terms with external suppliers and vendors
on a group basis.
The Manager is appointed in accordance with the terms of the Trust Deed. The Manager can be removed by notice in
writing given by the Trustee in favour of a corporation appointed by the Trustee under certain circumstances outlined in
the Trust Deed, including where Unitholders, by a resolution duly passed by a simple majority of Unitholders present and
voting (with no Unitholder being disenfranchised) at a Unitholders’ meeting, decide that the Manager is to be removed.
BOARD MATTERS
The Board
The Board is responsible for the overall leadership and oversight of both FCT’s and the Manager’s business, financial,
investment and material operational affairs and performance objectives, and its long-term success. The Board sets
the strategic direction of FCT and the Manager and the Manager’s approach to corporate governance, including the
organisational culture, values and ethical standards of conduct, and works with Management on its implementation
across all levels of the organisation, as well as focus on value creation, innovation and sustainability. The Board,
supported by Management, ensures necessary resources are in place for FCT and the Manager to meet its strategic
objectives. Through the enterprise-wide risk management framework of FCT and its subsidiaries (the “Group”), the Board
establishes and maintains a sound risk management framework to effectively monitor and manage risks. It also oversees
Management to ensure transparency and accountability to key stakeholder groups.
The Chairman
The chairman of the Board (the “Chairman”) leads the Board. The Chairman sets the right ethical and behavioural tone and
ensures the Board’s effectiveness by, among other things, encouraging active and effective engagement, participation
by and contribution from all directors of the Manager (the “Directors”) and facilitating positive relations among and
between them and Management. The Chairman promotes a culture of openness at Board meetings and encourages
Directors to engage in productive and thorough discussions and constructive debate on strategic, business and other
key issues pertinent to the business and operations of the Group and the Manager, leading to better decision-making and
enhanced business performance.
CORPORATEGOVERNANCE REPORT A N N U A L R E P O R T 2 0 2 0 / 1 0 3
Role of Management
The Management is led by the Chief Executive Officer (the “CEO”) of the Manager. The CEO is responsible and is accountable
to the Board for the conduct and performance of Management. Senior Management comprising the CEO and the Chief
Financial Officer (the “CFO”) of the Manager (collectively, “Key Management Personnel”) are responsible for executing
the Manager’s strategies and policies and are accountable to the Board for the planning, direction, control, conduct and
performance of the business operations of the Manager.
Division of Responsibilities between the Chairman and CEO
The Chairman and the CEO are separate persons and the division of responsibilities between the Chairman and the CEO
is clearly demarcated. This avoids concentration of power and ensures a degree of checks and balances, an increased
accountability, and greater capacity of the Board for independent decision-making. Such separation of roles between
the Chairman and CEO promotes robust deliberations by the Board and Management on the business activities of FCT.
Relationships between the CEO and Board
None of the members of the Board and the CEO are related to one another, and none of them has any business relationships
among them.
Board Committees
The Board has formed committees of the Board (the “Board Committees”) to oversee specific areas, for greater efficiency.
There are two Board Committees, namely, the Audit, Risk and Compliance Committee (the “ARCC”), and the Nominating
and Remuneration Committee (the “NRC”).
Minutes of all Board Committee meetings are circulated to the Board so that Directors are aware of and kept updated as
to the proceedings, matters discussed and decisions made during such meetings, and to enable the Directors to weigh in
on any key points under consideration.
Audit, Risk and Compliance Committee (1)
Membership
Key Objectives
Ms Koh Choon Fah, Chairman (2)
Dr Cheong Choong Kong, Member
Mr Ho Chai Seng, Member
Mr Ho Chee Hwee Simon, Member (3)
Notes:
•
in fulfilling responsibility for
Assist the Board
overseeing the quality and integrity of the accounting,
auditing, internal controls, risk management and
financial practices of the Manager
(1) Unless otherwise stated, the information provided herein is as of 30 September 2020.
(2) Ms Koh Choon Fah was appointed as a non-executive and independent Director, a member of the ARCC and a member of the NRC with effect from
1 October 2019. Ms Koh Choon Fah was appointed as the chairman of the ARCC with effect from 1 November 2019.
(3) Mr Ho Chee Hwee Simon served as the Chairman of the ARCC until 1 November 2019. With effect from 1 November 2019, Mr Ho Chee Hwee Simon
relinquished his role as the chairman of the ARCC and remains as a non-executive and non-independent Director and a member of the ARCC and the NRC.
As at 30 September 2020, the ARCC is made up of non-executive Directors, the majority of whom, including the chairman
of the ARCC, are independent Directors. The members of the ARCC, including the chairman of the ARCC, are appropriately
qualified and have recent and/or relevant accounting and related financial management expertise or experience. Their
collective wealth of experience and expertise enables them to discharge their responsibilities competently.
Under the Terms of Reference of the ARCC, a former partner or director of FCT’s existing auditing firm or auditing
corporation shall not act as a member of the ARCC: (a) within a period of two years commencing on the date of his ceasing
to be a partner of the auditing firm or a director of the auditing corporation; and in any case, (b) for so long as he has
any financial interest in the auditing firm or auditing corporation. None of the members of the ARCC is a former partner
of FCT’s external auditors, KPMG LLP and none of the members of the ARCC has any financial interest in FCT’s external
auditors, KPMG LLP.
Contents
CORPORATEGOVERNANCE REPORT 1 0 4 / F R A S E R S C E N T R E P O I N T T R U S T
AUDIT FUNCTIONS
The Terms of Reference of the ARCC provide that some of the key responsibilities of the ARCC include:
•
•
•
•
•
•
•
•
External Audit Process: reviewing and reporting to the Board the scope, quality, results and performance of the
external audit(s), its cost effectiveness and the independence and objectivity of the external auditors. It shall also
review the nature and extent of non-audit services performed by external auditors;
Internal Audit: establishing an effective internal audit function which shall be adequately qualified to perform an
effective role, adequately resourced, independent of the activities which it audits and able to discharge its duties
objectively, and to approve the hiring, removal, evaluation and compensation of the head of the internal audit
function, or the accounting/auditing firm or corporation to which the internal audit function is outsourced;
Financial Reporting: reviewing and reporting to the Board, the significant financial reporting issues and judgments
so as to ensure the integrity of the financial statements of FCT and the Manager and any announcements relating
to FCT’s and the Manager’s financial performance, and to review the assurance provided by the CEO and the CFO
that the financial records have been properly maintained and the financial statements give a true and fair view of
FCT’s and/or the Manager’s operations and finances;
Internal Controls and Risk Management: reviewing and reporting to the Board at least annually, its assessment of
the adequacy and effectiveness of the Manager’s internal controls for FCT and the Manager, including financial,
operational, compliance and information technology controls (including those relating to compliance with
existing legislation and regulations), and risk management policies and systems established by Management;
Interested Person Transactions: reviewing interested person transactions (as defined in the SGX-ST Listing Manual)
and interested party transactions (as defined in the Property Funds Appendix) (both such types of transactions
constituting “Related/Interested Person Transactions”) entered into from time to time and the internal audit
reports to ensure compliance with applicable legislation, the SGX-ST Listing Manual and the Property Funds
Appendix;
Conflicts of Interests: deliberating on resolutions relating to conflicts of interest situations involving FCT;
Whistle-blowing: reviewing the policy and arrangements by which staff of the Manager, FCT and any other persons
may, in confidence, safely raise concerns about possible improprieties in matters of financial reporting or other
matters and ensure that arrangements are in place for such concerns to be raised and independently investigated
and for appropriate follow-up action to be taken; and
Investigations: reviewing the findings of internal investigations into any suspected fraud or irregularity, or
suspected infringement of any Singapore laws or regulations or rules of the SGX-ST or any other regulatory
authority in Singapore, which the ARCC becomes aware of, and which has or is likely to have a material impact on
FCT’s operating results or financial position.
In carrying out its role, the ARCC is empowered to investigate any matter within its Terms of Reference, with full
access to, and cooperation by, Management, to seek information it may require from any Director and/or employee of
the Manager. The ARCC also has full discretion to invite any Director or executive officer to attend its meetings, and
reasonable resources to enable it to discharge its functions properly. The Chairman, non-executive Directors, the CEO,
the CFO, the head of the internal audit function, representatives of the external auditor(s), or other person with relevant
experience and expertise may attend the meetings of the ARCC at the invitation of the ARCC. The meetings serve as a
forum to review and discuss material risks and exposures of the Manager’s businesses and strategies to mitigate risks.
The ARCC meets with internal auditors and external auditors without the presence of Management at least once a year
to review various audit matters, including reviewing the audit plans, and evaluating the internal accounting controls, the
audit reports and the assistance given by Management to the internal and external auditors. In carrying out its function,
the ARCC may also obtain independent or external legal or other professional advice or appoint external consultants as
it considers necessary at the Manager’s cost.
CORPORATEGOVERNANCE REPORT A N N U A L R E P O R T 2 0 2 0 / 1 0 5
Regular updates on changes in accounting standards and treatment are prepared by external auditors and circulated
to members of the ARCC so that they are kept abreast of such changes and its corresponding impact on the financial
statements, if any.
Risk Management
The ARCC shall review the framework and processes established by Management to achieve compliance with applicable
laws, regulations, standards, best practice guidelines and the Manager’s policies and procedures. The ARCC shall assist
the Board in ensuring that Management maintains a sound system of risk management and internal controls to safeguard
the interests of the Manager or the interests of Unitholders (as the case may be) and the assets of the Manager and the
assets of FCT. The ARCC also assists the Board in its determination of the nature and extent of significant risks which the
Board is willing to take in achieving the Manager’s strategic objectives and the overall levels of risk tolerance and risk
policies. Further information on the key activities conducted by the ARCC can be found in the sections titled “Financial
Performance, Reporting and Audit” on page 123 and “Governance of Risk and Internal Controls” on pages 125 to 128.
Nominating and Remuneration Committee
Membership
Key Objectives
Mr Ho Chai Seng, Chairman
Dr Cheong Choong Kong, Member
Mr Ho Chee Hwee Simon, Member
Ms Koh Choon Fah, Member
Mr Christopher Tang Kok Kai, Member
•
•
•
•
•
Establish a formal and transparent process for
appointment and reappointment of Directors
Develop a process for evaluation of the performance
and annual assessment of the effectiveness of the
Board as a whole and each of its Board Committees,
and individual Directors
Review succession plans
in establishing a formal and
Assist the Board
transparent process for developing policies on
Director and executive remuneration, and for fixing
the remuneration packages of individual Directors
and Key Management Personnel
Review and recommend to the Board a general
framework of remuneration for the Board and Key
Management Personnel and specific remuneration
packages for each Director and Key Management
Personnel
As at 30 September 2020, all the members of the NRC are non-executive and the majority of whom, including the
chairman of the NRC, are independent.
The NRC is guided by written Terms of Reference approved by the Board which set out the duties and responsibilities
of the NRC. The NRC’s responsibilities, in relation to its functions as a nominating committee, include reviewing the
structure, size and composition and independence of the Board and its Board Committees, reviewing and making
recommendations to the Board on the succession plans for Directors, the Chairman and Key Management Personnel,
making recommendations to the Board on all Board appointments and re-appointments, and determining the
independence of Directors. The NRC also proposes for the Board’s approval, the objective performance criteria and
process for the evaluation of the effectiveness of the Board, the Board Committees and each Director, and ensures that
proper disclosures of such process are made. The NRC is also responsible for making recommendations to the Board on
training and professional development programmes for the Board and the Directors.
Contents
CORPORATEGOVERNANCE REPORT 1 0 6 / F R A S E R S C E N T R E P O I N T T R U S T
Further information on the main activities of the NRC, in relation to its functions as a nominating committee, are outlined
in the following sections:
•
•
•
•
“Training and development of Directors” on page 109
“Board Composition” on pages 109 to 117
“Directors’ Independence” on pages 112 to 116
“Board Performance Evaluation” on page 117
The NRC’s responsibilities, in reviewing remuneration matters, include: (i) reviewing and recommending to the Board, a
framework of remuneration for the Board and Key Management Personnel, and (ii) ensuring that the remuneration of
executive Directors shall not be linked in any way to FCT’s gross revenue.
On an annual basis, the NRC also reviews and recommends, for the Board’s approval, the Manager’s remuneration and
benefits policies and practices (including long-term incentive schemes), and the performance and specific remuneration
packages for each Director and Key Management Personnel, in accordance with the approved remuneration policies
and processes.
The NRC also proposes, for the Board’s approval, criteria to assist in the evaluation of the performance of Key Management
Personnel, and (where applicable) reviews the obligations of the Manager arising in the event of the termination of the
service agreements of Key Management Personnel to ensure that such contracts of service contain fair and reasonable
termination clauses which are not overly generous. The NRC also administers and approves awards under the Restricted
Unit Plan (“RUP”) and/or other long-term incentive schemes to senior executives of the Manager.
In carrying out its review on remuneration matters, the Terms of Reference of the NRC provide that the NRC shall consider
all aspects of remuneration, including Directors’ fees, special remuneration to Directors who render special or extra
services to the Manager, salaries, allowances, bonuses, options, Unit-based incentives and awards, benefits-in-kind and
termination payments, and shall aim to be fair and to avoid rewarding poor performance.
If necessary, the NRC can seek expert advice on remuneration within the Manager’s Human Resources Department or
from external sources. Where such advice is obtained from external sources, the NRC ensures that existing relationships, if
any, between the Manager and the appointed remuneration consultants will not affect the independence and objectivity
of the remuneration consultants.
Delegation of authority framework
As part of the Manager’s internal controls, the Board has adopted a framework of delegated authorisations in its Manual
of Authority (the “MOA”). The MOA sets out the levels of authorisation required for particular types of transactions to be
carried out, and specifies whether Board approval needs to be sought. It also sets out approval limits for operating and
capital expenditure as well as investments and asset enhancement initiatives.
While day-to-day operations of the business are delegated to Management, in the Board’s exercise of its leadership and
oversight of FCT, the MOA contains a schedule of matters specifically reserved for approval by the Board. These include
approval of annual budgets, financial plans, business strategies and material transactions, namely, major acquisitions,
divestments, funding and investment proposals, and appointment of key executives.
CORPORATEGOVERNANCE REPORT A N N U A L R E P O R T 2 0 2 0 / 1 0 7
Meetings of the Board and Board Committees
The Board meets regularly, at least once every quarter, and also as required by business needs or if their members deem
it necessary or appropriate to do so.
The following table summarises the number of meetings of the Board and Board Committees and general meetings held
and attended by the Directors in the financial year ended 30 September 2020 (“FY20”):
Audit, Risk and
Compliance
Committee
Meetings
Board
Meetings
Nominating
and
Remuneration
Committee
Meetings
Meetings held for FY20
Dr Cheong Choong Kong
Mr Philip Eng Heng Nee (3)
Mr Ho Chai Seng
Mr Ho Chee Hwee Simon
Ms Koh Choon Fah
Mr Low Chee Wah (6)
Mr Christopher Tang Kok Kai
Notes:
6
6 (C) (2)
1
6
6
6
5
6
4
4
1
4
4 (C) (2)(4)
4 (C) (2)(5)
N.A.
N.A.
2
2
N.A.
2 (C) (2)
2
2
N.A.
2
(1) Extraordinary General Meeting held on 28 September 2020.
(2)
(C) refers to chairman.
(3) Mr Philip Eng Heng Nee retired as a Director and a member of the ARCC on 3 January 2020.
Annual
General
Meeting
Extraordinary
General
Meeting (1)
1
1 (C) (2)
1
1 (C) (2)
N.A.
1
1
1
1
1
N.A.
1
1
1
1
1
(4) Mr Ho Chee Hwee Simon served as the Chairman of the ARCC until 1 November 2019. With effect from 1 November 2019, Mr Ho Chee Hwee Simon
relinquished his role as the chairman of the ARCC and remains as a non-executive and non-independent Director and a member of the ARCC and the NRC.
(5) Ms Koh Choon Fah was appointed as the chairman of the ARCC with effect from 1 November 2019.
(6) Mr Low Chee Wah was appointed as a non-executive Director on 3 January 2020.
A calendar of activities is scheduled for the Board a year in advance.
The Manager’s Constitution provides for Board members who are unable to attend physical meetings to participate
through telephone conference, video conference or similar communications equipment.
Directors are provided with Board papers setting out relevant information on the agenda items to be discussed at Board
and Board Committee meetings around a week in advance of the meeting (save in cases of urgency), to give Directors
sufficient time to prepare for the meeting and review and consider the matters being tabled so that discussions can be
more meaningful and productive and Directors have the necessary information to make sound and informed decisions.
Senior members of the Management attend Board meetings, and where necessary, Board Committee meetings, to
brief and make presentations to the Directors, provide input and insight into matters being discussed, and respond to
queries and take any follow-up instructions from the Directors. At least once a year and if required, time is set aside after
scheduled Board meetings for discussions amongst the Board without the presence of Management.
Where required by the Directors, external advisers may also be present or available whether at Board and Board
Committee meetings or otherwise, and (if necessary), at the Manager’s expense where applicable, to brief the Directors
and provide their advice.
Contents
CORPORATEGOVERNANCE REPORT 1 0 8 / F R A S E R S C E N T R E P O I N T T R U S T
Matters discussed by Board and Board Committees in FY20
BOARD
Strategy
Business and Operations Update
•
•
Financial Performance
Governance
•
•
Feedback from Board Committees
Acquisitions and Divestments
Proposals
Audit, Risk and Compliance Committee
Nominating and Remuneration Committee
External and Internal Audit
Financial Reporting
Stress Tests on Liquidity and Loan Covenants
Internal Controls and Risk Management
Related/Interested Person Transactions
Conflicts of Interests
•
•
•
•
•
Board Composition and Renewal
Board, Board Committees and Director Evaluations
Training and Development
Remuneration Policies and Framework
Succession Planning
•
•
•
•
•
•
•
•
Board Oversight
Outside of Board and Board Committee meetings, Management also provides Directors with reports on major operational
matters, business development activities, financial performance, potential investment opportunities and budgets
periodically, as well as such other relevant information on an on-going and timely basis to enable them to discharge their
duties and responsibilities properly. Where required or requested by Directors, site visits are also arranged for Directors
to have an intimate understanding of the key business operations of each division and to promote active engagement
with Management.
Directors are provided with sufficient information to enable them to ensure that they prepare adequately for Board and
Board Committee meetings, and devote sufficient time and attention to the affairs of FCT and the Manager. At Board
and Board Committee meetings, the Directors actively participate, discuss, deliberate and appraise matters requiring
their attention and decision. Where necessary for the proper discharge of their duties, the Directors may seek and obtain
independent professional advice at the Manager’s expense.
The Company Secretary
The Company Secretary of the Manager (“Company Secretary”), who is legally trained and familiar with company
secretarial practices, is responsible for administering and executing Board and Board Committee procedures in compliance
with the Companies Act (Chapter 50 of Singapore), the Manager’s Constitution, the Trust Deed and applicable law. The
Company Secretary also provides advice and guidance on relevant guidelines, notices, rules and regulations, including
disclosure requirements under the SFA, applicable MAS guidelines and notices, the CIS Code and the SGX-ST Listing
Manual, as well as corporate governance practices and processes.
The Company Secretary attends Board and Board Committee meetings and drafts and reviews the minutes of proceedings
thereof, and facilitates and acts as a channel of communication for the smooth flow of information to and within the
Board and its various Board Committees, as well as between and with senior Management.
The Company Secretary solicits and consolidates Directors’ feedback and evaluation, facilitates induction and orientation
programmes for new Directors, and assists with Directors’ professional development matters. The Company Secretary
also acts as the Manager’s primary channel of communication with the SGX-ST.
The appointment and removal of the Company Secretary is subject to the approval of the Board.
CORPORATEGOVERNANCE REPORT A N N U A L R E P O R T 2 0 2 0 / 1 0 9
Training and development of Directors
The NRC is tasked with identifying and developing training programmes for the Board and Board Committees for the
Board’s approval and ensuring that Directors have the opportunity to develop their skills and knowledge.
Upon appointment, each new Director is issued a formal letter of appointment setting out his or her duties and
obligations, including his or her responsibilities as fiduciaries and on the policies relating to conflicts of interest. An
induction and orientation programme is also conducted to provide new appointees with information on the business
activities, strategic direction, policies and corporate governance practices of the Manager, as well as their statutory and
other duties and responsibilities as Directors.
The Directors are kept continually and regularly updated on FCT’s business and the regulatory and industry specific
environments in which the entities of the Group operate. The Manager sees to it that the Board is regularly updated on
new developments in laws and regulations or changes in regulatory requirements and financial reporting standards
which are relevant to or may affect the Manager or FCT and such updates may be in writing, by way of briefings held by
the Manager’s lawyers and external auditors or disseminated by way of presentations and/or handouts. During FY20, the
Directors were updated on (a) changes in Financial Reporting Standards; (b) SGX-ST Listing Rules revisions on enhancing
continuous disclosures and; (c) tax regulations in relevant jurisdictions.
To ensure the Directors can fulfil their obligations and to continually improve the performance of the Board, all Directors
are encouraged to undergo continual professional development during the term of their appointment, and provided with
opportunities to develop and maintain their skills and knowledge at the Manager’s expense. The Manager maintains a
training record to track Directors’ attendance at training and professional development courses.
Directors are encouraged to be members of the Singapore Institute of Directors (“SID”) and for them to receive updates
and training from SID to stay abreast of relevant developments in financial, legal and regulatory requirements, and
business trends.
BOARD COMPOSITION
The following table shows the composition of the Board and the various Board Committees (1):
Dr Cheong Choong Kong
Mr Ho Chai Seng
Mr Ho Chee Hwee Simon (2)
Ms Koh Choon Fah (3)
Mr Low Chee Wah (4)
Mr Christopher Tang Kok Kai
Chairman, Non-Executive
(Independent) Director
Non-Executive
(Independent) Director
Non-Executive
(Non-Independent) Director
Non-Executive
(Independent) Director
Non-Executive
(Non-Independent Director)
Non-Executive
(Non-Independent) Director
Audit, Risk and
Compliance
Committee
Nominating and
Remuneration
Committee
•
•
•
•
(Chairman)
•
•
(Chairman)
•
•
•
Notes:
(1) Unless otherwise stated, the information provided herein is as of 30 September 2020.
(2) Mr Ho Chee Hwee Simon served as the Chairman of the ARCC until 1 November 2019. With effect from 1 November 2019, Mr Ho Chee Hwee Simon
relinquished his role as the chairman of the ARCC and remains as a non executive and non-independent Director and a member of the ARCC and the NRC.
(3) Ms Koh Choon Fah was appointed as a non-executive and independent Director, a member of the ARCC and a member of the NRC with effect from
1 October 2019. Ms Koh Choon Fah was appointed as the chairman of the ARCC with effect from 1 November 2019.
(4) Mr Low Chee Wah was appointed as a non-executive Director on 3 January 2020.
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CORPORATEGOVERNANCE REPORT 1 1 0 / F R A S E R S C E N T R E P O I N T T R U S T
Profiles of each of the Directors can be found at pages 16 to 19.
As can be seen from the table above, as at 30 September 2020, all of the Directors are non-executive and at least half of
the Board comprises independent Directors.
The NRC reviews, on an annual basis, the Board structure, size, composition of the Board and Board Committees, taking
into account the CG Code and the Securities and Futures (Licensing and Conduct of Business) Regulations (“SFLCB
Regulations”). The NRC has assessed that the current structure, size and composition of the Board and Board Committees
are appropriate for the scope and nature of FCT’s and the Manager’s operations. No individual or group dominates
the Board’s decision-making process or has unfettered powers of decision-making. The NRC is of the opinion that the
Directors with their diverse backgrounds and experience (including banking, finance, accounting and other relevant
industry knowledge, entrepreneurial and management experience, and familiarity with regulatory requirements and
risk management) provide the appropriate balance and mix of skills, knowledge, experience and other aspects of
diversity that avoids groupthink and fosters constructive debate and ensures the effectiveness of the Board and its Board
Committees. The Board concurs with the views of the NRC.
Board Composition in terms of Age Group, Independence, Tenure and Gender
(as at 30 September 2020)
Age Group
Independence
51–65
66–80
83%
17%
Non-Executive and
Independent Directors
Non-Executive and
Non-Independent Directors
50%
50%
Tenure
Gender
Male
Female
83%
17%
0
2
4
6
8
10
12
14
16
Number of Years as Director (as at 30 September 2020)
Non-Executive and Independent Directors
Non-Executive and Non-Independent Directors
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Under the NRC Terms of Reference, the NRC is tasked with making recommendations to the Board on all Board
appointments and re-appointments, taking into account, among other things, the scope and nature of the operations
of the Group, the requirements of the business, whether Directors who have multiple board representations are able
to carry out and have been carrying out their duties as Directors and whether the Directors have given sufficient time
and attention to the affairs of FCT and the Manager. The process for the selection, appointment and re-appointment of
Directors also takes into account the composition and progressive renewal of the Board and Board Committees, each
Director’s experience, education, expertise, judgment, personal qualities and general and sector specific knowledge in
relation to the needs of the Board as well as whether the candidates will add diversity to the Board and whether they are
likely to have adequate time to discharge their duties.
The NRC considers a range of different channels to source and screen candidates for Board appointments, depending on
the requirements, including tapping on existing networks and recommendations. External consultants may be retained
from time to time, where appropriate, to assist in assessing and selecting potential candidates. Suitable candidates are
carefully evaluated by the NRC so that recommendations made on proposed candidates are objective and well supported.
Instead of prescribing a maximum number of directorships and/or other principal commitments that each Director may
have, the NRC adopts a holistic assessment of each Director’s individual capacity and circumstances to carry out his or
her duties, taking into consideration not only the number of other board and other principal commitments held by each
Director, but also the nature and complexity of such commitments.
On an annual basis, the NRC reviews (a) the directorships and principal commitments of each Director, and (b) a
framework for Board evaluation to be conducted by an external consultant on the effectiveness of the Board. Through
the aforementioned Board evaluation exercise conducted by the external consultant, the Directors assess whether
Board members effectively manage his or her directorships and have the time and ability to contribute to the Board.
The assessment also takes into consideration Directors’ commitment, conduct and contributions (such as participation,
candour and ability to make quality decisions) at Board meetings, as well as whether Directors’ engagement with
Management is adequate and effective. Further details on the Board evaluation exercise is set out under the section
“Board Performance Evaluation” on page 117.
Directors are not subject to periodic retirement by rotation. Under its Terms of Reference, the NRC is tasked with reviewing
the succession plans for Directors, the Chairman and Key Management Personnel.
Board Diversity Policy
The Board has adopted, with the recommendation of the NRC, a board diversity policy. The NRC will monitor and implement
this policy, and will take the principles of the policy into consideration when determining the optimal composition of the
Board, the appointment and re-appointment of Directors and when recommending any proposed changes to the Board.
On the recommendation of the NRC, the Board may set certain measurable objectives/specific diversity targets, with a
view to achieving an optimal Board composition, and these objectives/specific diversity targets may be reviewed by the
NRC from time to time to ensure their appropriateness.
The Board views diversity at the Board level as an essential element for driving value in decision-making and proactively
seeks as part of its board diversity policy, to maintain an appropriate balance of expertise, skills and attributes among the
Directors. This is reflected in the diversity of the composition of the Board, in terms of age, gender, and the backgrounds
and competencies of the Directors, whose experience range from banking, finance and accounting, and include relevant
industry knowledge, entrepreneurial and management experience, and familiarity with regulatory requirements and risk
management. This is beneficial to FCT, the Manager and Management as decisions by, and discussions with, the Board
would be enriched by the broad range of views and perspectives and the breadth of experience of the Directors.
Contents
CORPORATEGOVERNANCE REPORT 1 1 2 / F R A S E R S C E N T R E P O I N T T R U S T
Directors’ Independence
The Directors exercise their judgment independently and objectively in the interests of FCT and the Manager. The NRC
determines annually, and as and when circumstances require, if a Director is independent. The Directors complete a
declaration of independence annually which is reviewed by the NRC.
Based on the declarations of independence of the Directors, and having regard to the circumstances set forth in Provision
2.1 of the CG Code, Rule 210(5)(d) of the SGX-ST Listing Manual, the MAS Guidelines No. SFA04-G07 “Guidelines to all
Holders of a Capital Markets Services Licence for Real Estate Investment Trust Management” dated 1 January 2016 and
Regulations 13D to 13H of the SFLCB Regulations (collectively, the “Relevant Regulations”), the NRC and the Board
have determined that for FY20, there are three independent Directors on the Board, namely Dr Cheong Choong Kong,
Mr Ho Chai Seng and Ms Koh Choon Fah.
Dr Cheong Choong Kong
Dr Cheong Choong Kong is a director of the National Council of Social Services as at 30 September 2020. He has confirmed,
inter alia, that he is:
(a)
(b)
(c)
is not connected1 to any substantial shareholder2 of the Manager or substantial Unitholder2 of FCT and does not
have any relationship with the Manager, its related corporations, its substantial shareholders, its officers or the
substantial Unitholders of FCT which could interfere with the exercise of his independent judgment as a Director;
(i) is not an executive director of the Manager or any of its related corporations and is not employed by the Manager,
any of its related corporations or the Trustee for FY20 or any of the past three financial years, and (ii) does not have
any immediate family member3 who has been employed by the Manager or any of its related corporations, FCT or
any of its related corporations or the Trustee, as an executive officer in any of the past three financial years; and
in FY20 or the immediate past financial year, (i) has not, and does not have any immediate family member who,
received significant payments4 or material services from the Manager or any of its subsidiaries, FCT of any of its
subsidiaries and/or the Trustee and (ii) was not, and does not have any immediate family member who was (A) a
substantial shareholder or substantial Unitholder of, or (B) a partner in (with 5% or more stake), or (C) an executive
officer of, or (D) a director of, any organisation or entity to which the Manager or any of its subsidiaries, FCT or any
of its subsidiaries or the Trustee received significant payments5 or material services (other than Directors’ fees).
Having considered the declaration of independence and the Relevant Regulations, the NRC has determined that,
Dr Cheong Choong Kong is an independent director as at 30 September 2020.
CORPORATEGOVERNANCE REPORT A N N U A L R E P O R T 2 0 2 0 / 1 1 3
Mr Ho Chai Seng
As at 30 September, Mr Ho Chai Seng does not hold other directorships. He has confirmed, inter alia, that he is:
(a)
(b)
(c)
is not connected1 to any substantial shareholder2 of the Manager or substantial Unitholder2 of FCT and does not
have any relationship with the Manager, its related corporations, its substantial shareholders, its officers or the
substantial Unitholders of FCT which could interfere with the exercise of his independent judgment as a Director;
(i) is not an executive director of the Manager or any of its related corporations and is not employed by the Manager,
any of its related corporations or the Trustee for FY20 or any of the past three financial years, and (ii) does not have
any immediate family member3 who has been employed by the Manager or any of its related corporations, FCT or
any of its related corporations or the Trustee, as an executive officer in any of the past three financial years; and
in FY20 or the immediate past financial year, (i) has not, and does not have any immediate family member who,
received significant payments4 or material services from the Manager or any of its subsidiaries, FCT of any of its
subsidiaries and/or the Trustee and (ii) was not, and does not have any immediate family member who was (A) a
substantial shareholder or substantial Unitholder of, or (B) a partner in (with 5% or more stake), or (C) an executive
officer of, or (D) a director of, any organisation or entity to which the Manager or any of its subsidiaries, FCT or any
of its subsidiaries or the Trustee received significant payments5 or material services (other than Directors’ fees).
Having considered the declaration of independence and the Relevant Regulations, the NRC has determined that Mr Ho
Chai Seng is an independent director as at 30 September 2020.
Ms Koh Choon Fah
As at 30 September 2020, Ms Koh Choon Fah is a director of the following companies:
•
•
•
•
•
•
•
•
•
•
Edmund Tie & Company (SEA) Pte. Ltd.;
Edmund Tie & Company (Thailand) Co., Ltd.;
Edmund Tie & Company Hospitality Management Services Pte. Ltd.;
Edmund Tie & Company Property Management Services Pte. Ltd.;
Edmund Tie & Company Sdn. Bhd.;
Edmund Tie Holdings Pte. Ltd.;
ET Investment Holdings Pte. Ltd.;
ET Investment Management (Singapore) Pte. Ltd.;
New Horizon Holdings Pte. Ltd.; and
OrangeTee & Tie (JV) Pte. Ltd.
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CORPORATEGOVERNANCE REPORT 1 1 4 / F R A S E R S C E N T R E P O I N T T R U S T
She has confirmed, inter alia, that she is:
(a)
(b)
(c)
is not connected1 to any substantial shareholder2 of the Manager or substantial Unitholder2 of FCT and does not
have any relationship with the Manager, its related corporations, its substantial shareholders, its officers or the
substantial Unitholders of FCT which could interfere with the exercise of her independent judgment as a Director;
(i) is not an executive director of the Manager or any of its related corporations and is not employed by the Manager,
any of its related corporations or the Trustee for FY20 or any of the past three financial years, and (ii) does not have
any immediate family member3 who has been employed by the Manager or any of its related corporations, FCT or
any of its related corporations or the Trustee, as an executive officer in any of the past three financial years; and
in FY20 or the immediate past financial year, (i) has not, and does not have any immediate family member who,
received significant payments4 or material services from the Manager or any of its subsidiaries, FCT of any of its
subsidiaries and/or the Trustee and (ii) was not, and does not have any immediate family member who was (A) a
substantial shareholder or substantial Unitholder of, or (B) a partner in (with 5% or more stake), or (C) an executive
officer of, or (D) a director of, any organisation or entity to which the Manager or any of its subsidiaries, FCT or any
of its subsidiaries or the Trustee received significant payments5 or material services (other than Directors’ fees).
Having considered the declaration of independence and the Relevant Regulations, the NRC had determined that,
notwithstanding the circumstances set out in note (2) on page 116, Ms Koh Choon Fah is an independent director as at
30 September 2020.
Notes:
(1) A Director is “connected” to a substantial shareholder of the Manager or a substantial Unitholder if: (a) (where such shareholder or Unitholder is an individual)
the Director is a member of the immediate family of such substantial shareholder or substantial Unitholder or employed by such substantial shareholder or
substantial Unitholder or accustomed or under an obligation, whether formal or informal, to act in accordance with the directions, instructions or wishes
of such substantial shareholder or substantial Unitholder, and (b) (where such shareholder or Unitholder is a corporation) the Director is employed by or a
director of such substantial shareholder, substantial Unitholder, their related corporations or associated corporations or accustomed or under an obligation,
whether formal or informal, to act in accordance with the directions, instructions or wishes of the substantial shareholder or substantial Unitholder.
(2) “substantial shareholder” and “substantial Unitholder” refers to a shareholder or Unitholder holding not less than 5% of the total votes or units attached
to all voting shares or units in the Manager or FCT, respectively.
(3) “immediate family” in relation to an individual, means the individual’s spouse, son, adopted son, step-son, daughter, adopted daughter, step-daughter,
father, step-father, mother, step-mother, brother, step-brother, sister or step-sister.
(4) As a guide, payments aggregated over any financial year in excess of S$50,000 would generally be deemed as significant. The amount and nature of the
service, and whether it is provided on a one-off or recurring basis, are relevant in determining whether the service provided is material.
(5) As a guide, payments aggregated over any financial year in excess of S$200,000 would generally be deemed significant irrespective of whether they
constitute a significant portion of the revenue of the organisation in question. The amount and nature of the service, and whether it is provided on a one-off
or recurring basis, are relevant in determining whether the service provided is material.
CORPORATEGOVERNANCE REPORT A N N U A L R E P O R T 2 0 2 0 / 1 1 5
The Board has considered the relevant requirements under the SFLCB Regulations and its views in respect of the
independence of each Director for FY20 are as follows:
The Director:
Dr Cheong
Choong Kong
Mr Ho Chee
Hwee Simon (1)
Mr Ho
Chai Seng
Ms Koh
Choon Fah (2)
Mr Low
Chee Wah (3)
Mr Christopher
Tang Kok Kai (4)
had been independent
from the management
of the Manager and
FCT during FY20
had been independent
from any business
relationship with the
Manager
FCT
during FY20
and
had been independent
from every substantial
the
shareholder of
Manager and every
substantial Unitholder
during FY20
not
been
a
had
substantial shareholder
of the Manager or a
substantial Unitholder
during FY20
has not served as a
director of the Manager
for a continuous period
of 9 years or longer as
at the last day of FY20
(i)
(ii)
(iii)
(iv)
(v)
Notes:
P
P
P
P
P
P
P
P
P
P
P
P
P
P
P
P
P
P
P
P
P
(1) Mr Ho Chee Hwee Simon was appointed as (a) the vice-chairman of the board of Frasers Hospitality International Pte Ltd, a subsidiary of FPL; and (b) an
advisor to FPL (collectively referred to as the “Prior Appointments”) on 16 July 2018, and would receive director’s fees amounting to S$75,000 per year
and advisor’s fees amounting to S$175,000 per year respectively. During the financial year ended 30 September 2019 (“FY19”), the NRC reviewed such
appointments and was satisfied that such appointments did not affect his continued ability to exercise strong objective judgment and be independent in the
expression of his views and in his participation in the deliberations and decision-making of the Board and the Board Committees of which he is a member and
that Mr Ho Chee Hwee Simon is able to act in the best interests of Unitholders as a whole.
Mr Ho Chee Hwee Simon was subsequently appointed as a director of Frasers Property (Singapore) Pte. Ltd. (“FPS”), a subsidiary of FPL, on 1 November
2019 (the “FPS Appointment”) and in conjunction with the FPS Appointment, Mr Ho Chee Hwee Simon was also appointed as the chairman of the Retail
Management Committee of FPL. In connection with the FPS Appointment, Mr Ho Chee Hwee Simon would receive director’s fees of S$75,000 per year. The
total fees that Mr Ho Chee Hwee Simon will be receiving for the Prior Appointments and the FPS Appointment will amount to S$325,000.
FPL wholly-owns the Manager and is a substantial Unitholder. Pursuant to the SFLCB Regulations, during FY20, Mr Ho Chee Hwee Simon is deemed to (i) have
a business relationship with the Manager and FCT; and (ii) be connected to a substantial shareholder of the Manager and a substantial Unitholder.
The NRC and the Board after taking into consideration the scope of the FPS Appointment and the total fees that Mr Ho Chee Hwee Simon would be receiving
for the Prior Appointments and the FPS Appointment, deemed that Mr Ho Chee Hwee Simon had ceased to be considered independent as he was not
independent from any business relationship with the Manager and FCT; and not independent from every substantial shareholder of the Manager and every
substantial Unitholder.
With effect from 1 November 2019, Mr Ho Chee Hwee Simon relinquished his role as the chairman of the ARCC and remains as a non-executive and
non-independent Director and a member of the ARCC and the NRC.
The Board of the Manager is satisfied that, as at 30 September 2020, Mr Ho Chee Hwee Simon was able to act in the best interests of all Unitholders as a
whole. As at 30 September 2020, Mr Ho Chee Hwee Simon was able to act in the best interests of all Unitholders as a whole.
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CORPORATEGOVERNANCE REPORT 1 1 6 / F R A S E R S C E N T R E P O I N T T R U S T
(2) Ms Koh Choon Fah is a director and a shareholder of New Horizon Holdings Pte Ltd (“New Horizon”), holding a 20% shareholding interest in New Horizon.
New Horizon holds 28.68% of Edmund Tie Holdings Pte. Ltd., which in turn holds 100% of Edmund Tie & Company (SEA) Pte. Ltd. (“ETCSEA”), in respect of
which Ms Koh Choon Fah is the chief executive officer and executive director (the “ETCSEA Appointments”). Pursuant to the SFLCB Regulations, Ms Koh
Choon Fah is deemed to have a business relationship with the Manager and FCT.
ETCSEA has been appointed by related corporations of the Manager, being other entities within the FPL group (“FPL Group”) in the current and immediately
preceding financial year, to provide services and received fees therefor (the “ETCSEA Fees”). The fees paid by FCT to ETCSEA during FY20 amounted to
approximately less than S$60,000.
Taking into consideration that the fees paid previously to ETCSEA have been made on an arm’s length basis following assessment and determination carried
out independently by the management teams of the relevant FPL Group entities based on objective criteria, including competence, service level and/or
competitiveness of pricing and the declaration of independence by Ms Koh Choon Fah, the Board of the Manager is satisfied that the appointment of ETCSEA
by entities of the FPL Group and the payment of ETCSEA Fees in respect therefor do not affect her continued ability to exercise strong objective judgment
and be independent in conduct and character (in particular, in the expression of her views and in her participation in the deliberations and decision-making
of the Board and Board Committees of which she is a member), acting in the best interests of all Unitholders as a whole.
As a measure by the Manager to mitigate potential conflicts of interest, FCT will not consider ETCSEA for the provision of valuation services for any acquisition
or disposal of retail assets by FCT or for any existing assets of FCT. For all other services, if ETCSEA is assessed and determined to be the most suitable based
on objective criteria, including competence, service level and/or competitiveness of pricing, and FCT is considering to engage ETCSEA, Ms Koh Choon Fah will
abstain from voting on any proposal for such engagement. Ms Koh Choon Fah will also not be involved in the provision of such services to FCT, which will
instead be provided by the other professionals of ETCSEA.
The Board of the Manager is satisfied that, as at 30 September 2020, Ms Koh Choon Fah was able to act in the best interests of all Unitholders as a whole. As
at 30 September 2020, Ms Koh Choon Fah was able to act in the best interests of all Unitholders as a whole.
(3) Mr Low Chee Wah is currently employed by a related corporation of the Manager and is a director of various subsidiaries and/or associated companies of
FPL, which wholly owns the Manager and is a substantial Unitholder. As such, during FY20, he is deemed (i) to have a management relationship with the
Manager and FCT; and (ii) connected to a substantial shareholder of the Manager and substantial Unitholder. The Board of the Manager is satisfied that, as at
30 September 2020, Mr Low Chee Wah was able to act in the best interests of all Unitholders as a whole. As at 30 September 2020, Mr Low Chee Wah was
able to act in the best interests of all Unitholders as a whole.
(4) During FY20, Mr Christopher Tang Kok Kai was employed by a related corporation of the Manager and was a director of various subsidiaries and/or associated
companies of FPL, which wholly owns the Manager and is a substantial Unitholder. Mr Christopher Tang Kok Kai retired on 31 December 2019. Following his
retirement, Mr Christopher Tang Kok Kai is appointed as an advisor to FPL with effect from 1 January 2020 (the “FPL Appointment”) and receives advisor’s
fees amounting to S$216,000 per year. With effect from 1 April 2020, the advisory services relating to the FPL Appointment are performed by Mr Christopher
Tang Kok Kai through CT Advisory, a sole-proprietorship of which Mr Christopher Tang Kok Kai is the sole-proprietor. As such, during FY20, he is deemed (i) to
have a management relationship with the Manager and FCT; (ii) to have a business relationship with the Manager and FCT; and (iii) connected to a substantial
shareholder of the Manager and substantial Unitholder. The Board of the Manager is satisfied that, as at 30 September 2020, Mr Christopher Tang Kok Kai
was able to act in the best interests of all Unitholders as a whole. As at 30 September 2020, Mr Christopher Tang Kok Kai was able to act in the best interests
of all Unitholders as a whole.
The independent Directors lead the way in upholding good corporate governance at the Board level and their presence
facilitates the exercise of objective independent judgment on corporate affairs. Their participation and input also
ensure that key issues and strategies are critically reviewed, constructively challenged, fully discussed and thoroughly
examined, taking into account the long-term interests of FCT and its Unitholders. As of 30 September 2020, none of
the independent Directors have been on the Board for a continuous period of nine years or longer. Board renewal is a
continuing process where the appropriate composition of the Board is continually under review. In this regard, the tenure
of each independent Director is monitored so that the process for board renewal is commenced ahead of any independent
Director reaching the nine-year mark to facilitate a smooth transition and to ensure that the Board continues to have
an appropriate balance of independence. To this end, the NRC is tasked with undertaking the process of reviewing,
considering and recommending any changes to the composition of the Board, where appropriate, taking into account
the requirements to be met by independent Directors including the SFLCB Regulations.
As at least half of the Board comprises independent Directors, the Manager will not be subjecting any appointment or
re-appointment of Directors to voting by Unitholders under Regulation 13D of the SFLCB Regulations. The Chairman is
presently an independent Director.
No alternate directors have been appointed on the Board for FY20.
Conflict Policy
To address and manage possible conflicts of interest (including in relation to Directors, officers and employees) that may
arise in managing FCT, the Manager has put in place procedures which, among other things, specify that: (a) the Manager
shall be dedicated to the management of FCT and will not directly or indirectly manage other REITs; (b) all executive
officers of the Manager will be employed by the Manager; (c) all resolutions in writing of the Directors in relation to
matters concerning FCT must be approved by a majority of the Directors, including at least one independent Director;
(d) at least one-third of the Board shall comprise independent Directors; (e) on matters where FPL and/or its subsidiaries
have an interest (directly or indirectly), Directors nominated by FPL and/or its subsidiaries shall abstain from voting. On
such matters, the quorum must comprise a majority of independent Directors and must exclude nominee Directors of
FPL and/or its subsidiaries; and (f) an interested Director is required to disclose his interest in any proposed transaction
with FCT and is required to abstain from voting on resolutions approving the transaction.
CORPORATEGOVERNANCE REPORT A N N U A L R E P O R T 2 0 2 0 / 1 1 7
The Manager does not have a practice of extending loans to Directors, and as at 30 September 2020, there were no loans
granted by the Manager to Directors. If there are such loans, the Manager will comply with its obligations under the
Companies Act (Chapter 50 of Singapore) in relation to loans, quasi-loans, credit transactions and related arrangements
to Directors.
Board Performance Evaluation
The NRC is tasked with making recommendations to the Board on the process and criteria for evaluation of the
performance of the Board as a whole, each of the Board Committees and the Directors.
The effectiveness of the Board as a whole, the Board Committees and the contribution by each Director to the
effectiveness of the Board are assessed annually. The Board, with the recommendation of the NRC, has implemented a
formal process for assessing the effectiveness of the Board and Board Committees and the contribution by each Director
to the effectiveness of the Board.
For FY19 and FY20, an independent external consultant, Ernst & Young Advisory Pte. Ltd. was appointed to facilitate
the process of conducting a Board evaluation survey. The external consultant has no connection with FCT or any of the
Directors, apart from being the consultant in previous financial year(s). The outcome of the evaluation in relation to
FY19 was satisfactory and based on the responses received, ratings were generally affirmative across the evaluation
categories. Based on the NRC’s review, the Board and the various Board Committees operate effectively and each Director
is contributing to the overall effectiveness of the Board.
For FY20, the survey was designed to provide an evaluation of the current effectiveness of the Board and to support the
Chairman and the Board in proactively considering what can enhance the readiness of the Board to address emerging
strategic priorities for FCT as a whole. As part of the survey, the external consultant will facilitate questionnaires to be
sent to all Directors as well as conduct interviews with some Directors to obtain their feedback.
The objective performance criteria covered in the Board evaluation exercise relate to the following key segments: (a)
the Board’s contribution to the overall development of FCT’s strategic and performance orientation; (b) Board priorities;
(c) Board composition and skills; (d) Governance of the Board and organisation focus; (e) the effectiveness of the
Board’s internal operations and Board dynamics, as well as engagement with key investors, Unitholders and strategic
stakeholders; (f) the Board’s relationship with Management; (g) the Board’s role in respect of Director development and
succession planning for the Board and Management; (h) Director performance, which includes an evaluation of whether
each Director is willing to challenge and ask questions to address gaps in and add to others’ thinking, effective in fulfilling
and delivering value on his/her responsibilities and acts as a valuable resource in fulfilling the Board’s accountabilities; (i)
the Board’s governance in the management of a REIT; and (j) the effectiveness of the Board Committees. The responses
to the questionnaires and interviews would be summarised by the external consultant and its report would be submitted
to the NRC. Findings and recommendations of the external consultant which include feedback from Directors would be
taken into consideration and any necessary follow-up actions would be undertaken with a view to improving the overall
effectiveness of the Board in fulfilling its role and meeting its responsibilities to Unitholders.
REMUNERATION MATTERS
The remuneration of the staff of the Manager and Directors’ fees are paid by the Manager from the management fees
it receives from FCT, and not by FCT. With the recommendations of the NRC, the Board has put in place a formal and
transparent process for developing policies on remuneration of Directors and Key Management Personnel and for fixing
the remuneration packages of individual Directors and Key Management Personnel.
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CORPORATEGOVERNANCE REPORT 1 1 8 / F R A S E R S C E N T R E P O I N T T R U S T
Compensation Philosophy
The Manager seeks to incentivise and reward consistent and sustained performance through market competitive,
internally equitable, performance-orientated and Unitholder-aligned compensation programmes. This compensation
philosophy serves as the foundation for the Manager’s remuneration framework, and guides the Manager’s remuneration
framework and strategies. In addition, the Manager’s compensation philosophy seeks to align the aspirations and
interests of its employees with the interests of FCT and its Unitholders, resulting in the sharing of rewards for both
employees and Unitholders on a sustained basis. The Manager’s compensation philosophy serves to attract, retain and
motivate employees. The Manager aims to connect employees’ desire to develop and fulfil their aspirations with the
growth opportunities afforded by the Manager’s strategic vision and corporate initiatives.
Compensation Principles
All compensation programme design, determination and administration are guided by the following principles:
(a)
Pay-for-Performance
The Manager’s Pay-for-Performance principle encourages excellence, in a manner consistent with the Manager’s
core values. The Manager takes a total compensation approach, which recognises the value and responsibility of
each role, and differentiates and rewards performance through its incentive plans.
(b)
Unitholder Returns
Performance measures for incentives are established to drive initiatives and activities that are aligned with
both short-term value creation and long-term Unitholder wealth creation, thus ensuring a focus on delivering
Unitholder returns.
(c)
Sustainable Performance
The Manager believes sustained success depends on the balanced pursuit and consistent achievement of short-
term and long-term goals. Hence, variable incentives incorporate a significant pay-at-risk element to align
employees with sustainable performance for the Manager.
(d)
Market Competitiveness
The Manager aims to be market competitive by benchmarking its compensation levels with relevant comparators
accordingly. However, the Manager embraces a holistic view of employee engagement that extends beyond
monetary rewards. Recognising each individual as unique, the Manager seeks to motivate and develop employees
through all the levers available to the Manager through its comprehensive human capital platform.
Engagement of External Consultants
The NRC may from time to time, and where necessary or required, engage external consultants in framing the remuneration
policy and determining the level and mix of remuneration for Directors and Management. Among other things, this helps
the Manager to stay competitive in its remuneration packages. During FY20, Korn Ferry was appointed as the Manager’s
remuneration consultant. The remuneration consultant does not have any relationship with FCT, the Manager, its
controlling shareholders, its related entities and/or its Directors which would affect its independence and objectivity.
Remuneration Framework
The NRC reviews and makes recommendations to the Board on the remuneration framework for the independent
Directors and other non-executive Directors and the Key Management Personnel. The remuneration framework is
endorsed by the Board.
The remuneration framework covers all aspects of remuneration including salaries, allowances, performance bonuses,
grant of awards of units of FCT (“Units”) and incentives for the Key Management Personnel and fees for the independent
Directors and other non-executive Directors.
CORPORATEGOVERNANCE REPORT A N N U A L R E P O R T 2 0 2 0 / 1 1 9
Remuneration Policy in respect of Management and other employees
The NRC reviews the level, structure and mix of remuneration and benefits policies and practices (where appropriate) of
the Manager, to ensure that they are appropriate and proportionate to the sustained performance and value creation of
FCT and the Manager, taking into account the strategic objectives of FCT and the Manager, and designed to attract, retain
and motivate the Key Management Personnel to successfully manage FCT and the Manager for the long-term. The NRC
takes into account all aspects of remuneration, including termination terms, to ensure that they are fair.
The remuneration framework comprises fixed and variable components, which include short-term and long-term
incentives. When conducting its review of the remuneration, the NRC takes into account the performance of FCT and
individual performance. The performance of FCT is measured based on pre-set financial and non-financial indicators.
Individual performance is measured via the employee’s annual appraisal based on indicators such as core values,
competencies and key performance indicators.
Fixed Component
The fixed component in the Manager’s remuneration framework is structured to remunerate employees for the roles
they perform, and is benchmarked against relevant industry market data. It comprises base salary, fixed allowances and
any statutory contribution. The base salary and fixed allowances for Key Management Personnel are reviewed annually
by the NRC and approved by the Board.
Variable Component
An appropriate proportion of the remuneration of key executives of the Manager comprises a variable component which
is structured so as to link rewards to corporate and individual performance and incentivise sustained performance in both
the short and long-term. The variable incentives are measured based on quantitative and qualitative targets, and overall
performance will be determined at the end of the year and approved by the NRC.
1.
Short-Term Incentive Plans
The short-term incentive plans (“STI Plans”) aim to incentivise excellence in performance in the short-term. All Key
Management Personnel’s performance are assessed through either a balanced scorecard or annual performance
review with pre-agreed financial and non-financial key performance indicators (“KPIs”). The financial KPIs are
based on the performance of FCT. Non-financial KPIs may include measures on People, Corporate Governance,
Sustainability or specified projects. These targets are established at the beginning of each financial year. At the
end of the financial year, the achievements are measured against the pre-agreed targets and the short-term
incentives of each Key Management Personnel are determined.
The NRC recommends the final short-term incentives that are awarded to Key Management Personnel for the
Board’s approval, taking into consideration any other relevant circumstances.
2.
Long-Term Incentive Plans
The NRC administers the Manager’s long-term incentive plan, namely, the RUP. The RUP was approved by the
Board and adopted on 8 December 2017. Through the RUP, the Manager seeks to foster a greater ownership
culture within the Manager by aligning more directly the interests of senior executives (including the CEO) with the
interests of Unitholders and other stakeholders, and for such employees to participate and share in FCT’s growth
and success, thereby ensuring alignment with sustainable value creation for Unitholders over the long-term.
The RUP is available to selected senior executives of the Manager. Its objectives are to increase the Manager’s
flexibility and effectiveness in its continuing efforts to attract, retain and motivate talented senior executives and
to reward these executives for the future performance of FCT and the Manager.
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CORPORATEGOVERNANCE REPORT 1 2 0 / F R A S E R S C E N T R E P O I N T T R U S T
Under the RUP, the Manager grants Unit-based awards (“Initial Awards”) with pre-determined performance targets
being set at the beginning of the performance period. The NRC recommends the Initial Awards granted to Key
Management Personnel to the Board for approval, taking into consideration the Key Management Personnel’s
individual performance. The performance period for the RUP is one year. The pre-set targets are net property income
and distribution per Unit. Such performance conditions are generally performance indicators that are key drivers of
Unitholder value creation and aligned to FCT’s business objectives. The RUP awards represent the right to receive
fully paid Units, their equivalent cash value or a combination thereof, free of charge, provided certain prescribed
performance conditions are met. The final number of Units to be released (“Final Awards”) will depend on the
achievement of the pre-determined targets at the end of the performance period. If such targets are exceeded,
more Units than the Initial Awards may be delivered, subject to a maximum multiplier of the Initial Awards. The
Final Awards will vest to the participants in three tranches over two years after a one-year performance period. The
obligation to deliver the Units is expected to be satisfied out of the Units held by the Manager.
The NRC has absolute discretion to decide on the Final Awards, taking into consideration any other relevant
circumstances.
Approach to Remuneration of Key Management Personnel
The Manager advocates a performance-based remuneration system that is highly flexible and responsive to the market,
which also takes into account FCT’s performance and that of its employees.
In designing the compensation structure, the NRC seeks to ensure that the level and mix of remuneration is competitive,
relevant and appropriate in finding a balance between current versus long-term compensation and between cash versus
equity incentive compensation.
Executives who have a greater ability to influence outcomes within the Manager have a greater proportion of overall
reward at risk. The NRC exercises broad discretion and independent judgment in ensuring that the amount and mix of
compensation are aligned with interests of Unitholders and other stakeholders and promote the long-term success of FCT.
Performance Indicators for Key Management Personnel
As set out above, the Manager’s variable remuneration comprises short-term and long-term incentives, taking into
account both FCT’s and individual performance. This is to ensure employee remuneration is linked to performance.
In determining the short-term incentives, both FCT’s financial and non-financial performance as per the balanced
scorecard are taken into consideration. The performance targets align the interests of the Key Management Personnel
with the long-term growth and performance of FCT and the Manager. The financial performance indicators on which
the Key Management Personnel are evaluated comprise (a) FCT’s net property income, (b) distribution per Unit, (c) FCT’s
Total Return (against a peer group) and, (d) Targeted Asset Divestment/Recycling. These performance indicators are
quantitative and are objective measures of FCT’s performance. The non-financial performance indicators on which the
Key Management Personnel are evaluated include (i) people development and branding, (ii) corporate governance and
compliance, (iii) sustainability and (iv) IT and cyber-security. These qualitative performance indicators will align the Key
Management Personnel’s performance with FCT’s strategic objectives.
In relation to long-term incentives, the Manager has implemented the RUP with effect from the financial year ended
30 September 2018 as set out above. The release of long-term incentive awards to Key Management Personnel are
conditional upon the performance targets being met. The performance targets of the KPIs align the interests of the
Key Management Personnel with the long-term growth and performance of FCT. In FY20, the pre-determined target
performance levels for the RUP grant were partially met.
Currently, the Manager does not have claw-back provisions which allow it to reclaim incentive components of
remuneration from its Key Management Personnel in exceptional circumstances of misstatement of financial results or
misconduct resulting in financial loss.
CORPORATEGOVERNANCE REPORT A N N U A L R E P O R T 2 0 2 0 / 1 2 1
Remuneration Packages of Key Management Personnel
The NRC reviews and makes recommendations on the specific packages and service terms for the Key Management
Personnel for endorsement by the Board. The NRC will review the short-term and long-term incentives in the Key
Management Personnel’s remuneration package to ensure its compliance with the substance and spirit of the directions
and guidelines from the MAS.
No Director or Key Management Personnel is involved in deciding his or her remuneration.
The NRC aligns the CEO’s leadership, through appropriate remuneration and benefit policies, with FCT’s and the
Manager’s strategic objectives and key challenges. Performance targets are also set for the CEO and his performance
is evaluated yearly.
Remuneration Policy in respect of Non-Executive Directors
The remuneration of non-executive Directors has been designed to be appropriate to the level of contribution, taking
into account factors such as effort, time spent, and responsibilities, on the Board and Board Committees, and to attract,
retain and motivate the Directors to provide good stewardship of FCT.
Non-executive Directors do not receive bonuses, options or Unit-based incentives and awards. Directors’ fees are paid in
cash and not in the form of Units.
The Manager engages consultants to review Directors’ fees by benchmarking such fees against the amounts paid
by listed industry peers. Each non-executive Director’s remuneration comprises a basic fee and attendance fees for
attending Board and Board Committee meetings. In addition, non-executive Directors who perform additional services
in Board Committees are paid an additional fee for such services. The chairman of each Board Committee is also paid
a higher fee compared with the members of the respective Board Committees in view of the greater responsibility
carried by that office.
The Manager’s Board fee structure during FY20 is set out below.
Basic Fee
per annum
(S$)
Attendance Fee
per meeting (1)
(for physical
attendance in
Singapore)
(S$)
Attendance Fee
per meeting
(for physical
attendance outside
Singapore (excluding
home country
Attendance Fee
per meeting
(for attendance
via tele/video
of Director))
(S$)
conference)
(S$)
Board
– Chairman
– Member
Audit, Risk and
Compliance Committee
– Chairman
– Member
Nominating and
Remuneration Committee
– Chairman
– Member
Note:
90,000
45,000
40,000
20,000
12,000
6,000
(1) The attendance fee applies for attendance in person in Singapore.
3,000
1,500
3,000
1,500
3,000
1,500
4,500
4,500
4,500
4,500
4,500
4,500
1,000
1,000
1,000
1,000
1,000
1,000
Contents
CORPORATEGOVERNANCE REPORT 1 2 2 / F R A S E R S C E N T R E P O I N T T R U S T
Disclosure of Remuneration of Directors and Key Executives of the Manager
Information on the remuneration of Directors and key executives of the Manager for FY20 is set out below.
Directors of the Manager
Dr Cheong Choong Kong
Mr Philip Eng Heng Nee (1)
Mr Ho Chai Seng
Mr Ho Chee Hwee Simon
Ms Koh Choon Fah
Mr Low Chee Wah (3)
Mr Christopher Tang Kok Kai
Notes:
Remuneration (*)
S$
129,166.67
19,599.47
91,791.67
86,208.33 (2)
102,041.67
37,133.06
58,875.00 (4)
(1) Mr Philip Eng Heng Nee retired as a Director on 3 January 2020.
(2) Excludes S$75,000 and S$275,000 being payment of director’s fees and advisor’s fees respectively for the Prior Appointments, and S$75,000 being payment
of director’s fees for the FPS Appointment, from FPL Group (excluding the Manager).
(3) Mr Low Chee Wah was appointed as a Director with effect from 3 January 2020. Director’s fees are paid to Frasers Property Corporate Services Pte. Ltd.
(4) During FY20, Mr Christopher Tang Kok Kai was employed by a related corporation of the Manager and was a director of various subsidiaries and/or
associated companies of FPL, which wholly owns the Manager and is a substantial Unitholder. Mr Christopher Tang Kok Kai retired on 31 December 2019.
Director’s fees are paid to Frasers Property Corporate Services Pte. Ltd. during his employment with the FPL Group till 31 December 2019. Director’s fees
are paid to Mr Christopher Tang Kok Kai directly with effect from 1 January 2020.
Excludes S$162,000 being payment of the advisor’s fees for the FPL Appointment from 1 January 2020 to 30 September 2020, from FPL Group (excluding
the Manager).
(*) The Board had approved the waiver of 10% of non-executive Directors’ fees for the period from 1 May 2020 to 30 September 2020, and this has been
reflected in the amount of remuneration.
Remuneration of CEO for FY20
Between S$750,001 to S$1,000,000
Mr Richard Ng (1)
Remuneration of key
executives of the Manager (2)
(excluding CEO) for FY20
Ms Tay Hwee Pio
Ms Pauline Lim (5)
Mr Chen Fung Leng
Mr Rene Lee (6)
Mr Alex Chia (7)
Aggregate Total Remuneration
(including CEO)
Notes:
Salary
%
Bonus
%
Allowances
and
Benefits
%
Long-Term
Incentives
%
Total (3)
%
47
18
5
30
100
Salary
%
Bonus
%
Allowances
and
Benefits
%
Long-Term
Incentives
%
Total (3)
%
57 (4)
20 (4)
2 (4)
21 (4)
100 (4)
S$2,285,504
(1) The amount excludes one-off payments contractually agreed in connection with his appointment within FPL Group which has been paid/will become
payable upon satisfaction of a stipulated period of his appointment.
(2) The key executives of the Manager (excluding the CEO) listed in this table are the CFO and the division heads of the Manager.
(3) Certain key executives of the Manager have taken a reduction in their remuneration for the period from 1 May 2020 to 30 September 2020 and this has been
reflected in the amount of total remuneration.
(4) Derived based on the aggregation of the respective remuneration components of each of the key executives of the Manager (excluding the CEO) and
represented as percentages against the total remuneration for these key executives.
(5) Calculated from 16 June 2020 to 30 September 2020. Ms Pauline Lim was appointed as Head of Investment and Asset Management on 16 June 2020.
(6) Pending the appointment of the Head of Investment, Mr Rene Lee was leading the investment team of the Manager till 15 June 2020. Following Ms
Pauline Lim’s appointment as Head of Investment and Asset Management on 16 June 2020, Mr Rene Lee ceased to lead the investment team with effect
from 16 June 2020.
(7) Calculated from 1 October 2019 to 30 April 2020. Mr Alex Chia ceased to be the Head of Asset Management with effect from 1 May 2020.
CORPORATEGOVERNANCE REPORT A N N U A L R E P O R T 2 0 2 0 / 1 2 3
For FY20, there were no termination, retirement and post-employment benefits granted to the Directors, the CEO and
Key Management Personnel.
Pursuant to the MAS Notice to All Holders of a Capital Markets Services Licence for Real Estate Investment Trust
Management (Notice No: SFA4-N14), REIT managers are required to disclose the remuneration of the CEO and each
individual Director on a named basis, and the remuneration of at least the top five executive officers (which shall not
include the CEO and executive officers who are Directors), on a named basis, in bands of S$250,000. The REIT manager
may provide an explanation if it does not wish to or is unable to comply with such requirement. The Manager has decided
(a) to disclose the CEO’s remuneration in bands of S$250,000 (instead of on a quantum basis), (b) not to disclose the
remuneration of the other key executives of the Manager in bands of S$250,000 and (c) to disclose the aggregate
remuneration of all key executives of the Manager (including the CEO), for the following reasons:
(i)
(ii)
(iii)
(iv)
competition for talent in the REIT management industry is very keen and the Manager has, in the interests
of Unitholders, opted not to disclose the exact remuneration of its CEO and the other key executives of the
Manager as this may give rise to recruitment and talent retention issues as well as the risk of unnecessary key
management turnover;
the composition of the current management team has been stable and to ensure the continuity of business and
operations of FCT, it is important that the Manager continues to retain its team of competent and committed staff;
due to the confidentiality and sensitivity of staff remuneration matters, the Manager is of the view that such
disclosure could be prejudicial to the interests of Unitholders; and
the remuneration of the CEO and the other key executives of the Manager are paid by the Manager and there is
full disclosure of the total amount of fees paid to the Manager set out at pages 146, 197 and 217 to 218 of this
Annual Report.
As at 30 September 2020, there are no employees within the Manager who is a substantial Unitholder or who is an
immediate family member of a Director, the CEO or a substantial Unitholder.
FINANCIAL PERFORMANCE, REPORTING AND AUDIT
The Board, with the support of Management, is responsible for providing a balanced and understandable assessment of
FCT’s performance, position and prospects. Financial reports are provided to the Board on a quarterly basis and monthly
accounts are made available to the Directors on request.
The Manager prepares the financial statements of FCT in accordance with the recommendations of the Statement of
Recommended Accounting Practice 7 “Reporting Framework for Unit Trusts” issued by the Institute of Singapore Chartered
Accountants, the applicable requirements of the CIS Code issued by the MAS and the provisions of the Trust Deed.
Quarterly financial results were provided to Unitholders for the financial quarters ended 31 December 2019 and 31 March
2020. Following the amendments to Rule 705(2) of the SGX-ST Listing Manual which took effect from 7 February 2020,
the Manager announced on 13 May 2020 that it would cease to announce its financial statements on a quarterly basis and
would announce its financial statements on a half-yearly basis, commencing from the financial results announcement
for the full-year ended 30 September 2020. The Manager would provide business updates to Unitholders for the first
and third quarter performance of FCT, commencing with the third quarter ended 30 June 2020. The Board also provides
Unitholders with business updates, other price sensitive information and material corporate developments through
announcements to the SGX-ST and, where appropriate, press releases, FCT’s website and media and analysts’ briefings.
Contents
CORPORATEGOVERNANCE REPORT 1 2 4 / F R A S E R S C E N T R E P O I N T T R U S T
External Audit
The ARCC conducts an assessment of the external auditors, and recommends its appointment, re-appointment and
removal to the Board. The assessment is based on factors such as the performance and quality of its audit, the cost
effectiveness and the independence and objectivity of the external auditors.
At the annual general meeting (“AGM”) held on 13 January 2020, KPMG LLP was re-appointed by Unitholders as the
external auditors of FCT for FY20. Pursuant to the requirements of the SGX-ST, an audit partner may only be in charge of
a maximum of five consecutive annual audits and may then return after two years. The current KPMG LLP audit partner
for the Group was appointed at the AGM held on 21 January 2016. There will be a new audit partner in charge for the
financial year ending 30 September 2021.
During FY20, the ARCC conducted a review of the scope, quality, results and performance of audit by the external
auditors and its cost effectiveness, as well as the independence and objectivity of the external auditors. It also reviewed
all non-audit services provided by the external auditors during the financial period, and the aggregate amount of
fees paid to them for such services. Details of fees payable to the external auditors in respect of audit and non-audit
services for FY20 are set out in the table below:
Fees relating to external auditors for FY20
For audit and audit-related services
For non-audit services
Total
S$’000
201.5
43.0
244.5
The ARCC has conducted a review of all non-audit services provided by KPMG LLP during the financial period. The ARCC
is satisfied that given the nature and extent of non-audit services provided and the fees for such services, neither the
independence nor the objectivity of KPMG LLP is put at risk. KPMG LLP attended the ARCC meetings held every quarter
for FY20, and where appropriate, has met with the ARCC without the presence of Management to discuss their findings,
if any.
The Manager, on behalf of FCT, confirms that FCT has complied with Rule 712 of the SGX-ST Listing Manual which
requires, amongst others, that a suitable auditing firm should be appointed by FCT having regard to certain factors. FCT
has also complied with Rule 715 of the SGX-ST Listing Manual which requires that the same auditing firm of FCT based
in Singapore audits its Singapore-incorporated subsidiaries and significant associated companies, and that a suitable
auditing firm be engaged for its significant foreign-incorporated subsidiaries and associated companies.
CORPORATEGOVERNANCE REPORT A N N U A L R E P O R T 2 0 2 0 / 1 2 5
In the review of the financial statements for FY20, the ARCC discussed the following key audit matters identified by the
external auditors with Management:
Key Audit Matters
How this issue was addressed by the ARCC
Valuation of investment properties
The ARCC considered the methodologies and key assumptions
applied by the valuers in arriving at the valuation of the properties.
The ARCC reviewed the outputs from the financial year-end
valuation process of the Group’s investment properties and
discussed the details of the valuation with Management,
focusing on significant changes in fair value measurements and
key drivers of the changes.
The ARCC was satisfied with the valuation process, the
methodologies used and the valuation for investment properties
as adopted as at 30 September 2020.
Accounting on Acquisitions
The ARCC reviewed the accounting of the Group’s acquisition of
additional 12.07% stake in AsiaRetail Fund Limited.
The ARCC considered the legal and contractual arrangements
of the acquisition and the purchase price allocation assessment
performed by the Manager.
The ARCC was satisfied that the acquisition has been appropriately
accounted for as a business combination.
GOVERNANCE OF RISK AND INTERNAL CONTROLS
The Board is responsible for the governance of risk and ensures that Management maintains a sound system of risk
management and internal controls.
Enterprise Risk Management and Risk Tolerance
The Manager has established a sound system of risk management and internal controls comprising procedures and
processes to safeguard FCT’s assets and FCT’s and its Unitholders’ interests. The ARCC reviews and reports to the Board
on the adequacy and effectiveness of such controls, including financial, compliance, operational and information
technology controls, and risk management procedures and systems, taking into consideration the recommendations of
both internal and external auditors.
Internal Controls
The ARCC, through the assistance of internal and external auditors, reviews and reports to the Board on the adequacy
and effectiveness of the Manager’s system of controls, including financial, compliance, operational and information
technology controls. In assessing the effectiveness of internal controls, the ARCC ensures primarily that key objectives
are met, material assets are properly safeguarded, fraud or errors (if any) in the accounting records are prevented or
detected, accounting records are accurate and complete, and reliable financial information is prepared in compliance
with applicable internal policies, laws and regulations.
A comfort matrix of key risks, by which relevant material financial, compliance and operational (including information
technology) risks of FCT and the Manager have been documented to assist the Board to assess the adequacy and
effectiveness of the existing internal controls. The comfort matrix is prepared with reference to the strategies, policies,
processes, systems and reporting processes connected with the management of such key risks and presented to the
Board and the ARCC.
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CORPORATEGOVERNANCE REPORT 1 2 6 / F R A S E R S C E N T R E P O I N T T R U S T
Risk Management
The Board, through the ARCC, reviews the adequacy and effectiveness of the Manager’s risk management framework
to ensure that robust risk management and mitigating controls are in place. The Manager has adopted an enterprise-
wide risk management (“ERM”) framework to enhance its risk management capabilities. Key risks, control measures
and management actions are continually identified, reviewed and monitored as part of the ERM process. Financial and
operational key risk indicators are in place to track key risk exposures. Apart from the ERM process, key business risks are
thoroughly assessed by Management and each significant transaction is comprehensively analysed so that Management
understands the risks involved before it is embarked upon. An outline of the Manager’s ERM framework and progress
report is set out on pages 72 to 73.
Periodic updates are provided to the ARCC on FCT’s and the Manager’s risk profiles. These updates would involve an
assessment of FCT’s and the Manager’s key risks by risk categories, current status, the effectiveness of any mitigating
measures taken, and the action plans undertaken by Management to manage such risks.
In addition to the ERM framework, risk tolerance statements setting out the nature and extent of significant risks which
the Manager is willing to take in achieving its strategic objectives have been formalised and adopted.
The Board has received assurance from the CEO and the CFO that as at 30 September 2020:
(a)
(b)
(c)
the financial records of FCT have been properly maintained and the financial statements for FY20 give a true and
fair view of FCT’s operations and finances;
the system of internal controls in place for FCT is adequate and effective to address financial, operational, compliance
and information technology risks which the Manager considers relevant and material to FCT’s operations; and
the risk management system in place for FCT is adequate and effective to address risks which the Manager
considers relevant and material to FCT’s operations.
Board’s Comment on Internal Controls and Risk Management Framework
Based on the internal controls established and maintained by the Manager, work performed by internal and external
auditors, reviews performed by Management and the ARCC and assurance from the CEO and the CFO, the Board is of
the view that the internal controls in place for FCT were adequate and effective as at 30 September 2020 to address
financial, operational, compliance and information technology risks, which the Manager considers relevant and material
to FCT’s operations.
Based on the risk management framework established and adopted by the Manager, review performed by Management
and assurance from the CEO and the CFO, the Board is of the view that the risk management system in place for FCT was
adequate and effective as at 30 September 2020 to address risks which the Manager considers relevant and material to
FCT’s operations.
The Board notes that the system of internal controls and risk management provides reasonable, but not absolute,
assurance that the Manager will not be adversely affected by any event that could be reasonably foreseen as it works to
achieve its business objectives.
In this regard, the Board also notes that no system of internal controls and risk management can provide absolute
assurance against the occurrence of material errors, poor judgment in decision-making, human error, losses, fraud or
other irregularities.
The ARCC concurs with the Board’s view that as at 30 September 2020, the internal controls of FCT (including financial,
operational, compliance and information technology controls) and risk management systems were adequate and
effective to address risks which the Manager considers relevant and material to FCT’s operations.
CORPORATEGOVERNANCE REPORT A N N U A L R E P O R T 2 0 2 0 / 1 2 7
Internal Audit
The internal audit function of the Manager is performed by FPL Group’s internal audit department (“FPL Group IA”). FPL
Group IA is responsible for conducting objective and independent assessments on the adequacy and effectiveness of the
Manager’s system of internal controls, risk management and governance practices. The Head of the FPL Group IA, who
is a Certified Fraud Examiner and a Fellow of the Institute of Singapore Chartered Certified Accountants, CPA Australia
and ACCA, reports directly to the chairman of the ARCC, and administratively to the Group Chief Executive Officer of the
Sponsor or such other officer as may be charged with this responsibility from time to time. The appointment and removal
of the FPL Group’s internal audit department as the service provider of the Manager’s internal audit function requires the
approval of the ARCC. In performing internal audit services, FPL Group IA has adopted and complies with the Standards
for the Professional Practice of Internal Auditing set by The Institute of Internal Auditors.
As at 30 September 2020, FPL Group IA comprises 22 professional staff. The Head of the FPL Group IA and the Singapore-
based FPL Group IA staff are members of The Institute of Internal Auditors, Singapore. To ensure that the internal audit
activities are effectively performed, FPL Group IA recruits and employs suitably qualified staff with the requisite skills and
experience. Such staff are given relevant training and development opportunities to update their technical knowledge
and auditing skills. All staff members of FPL Group IA also receive relevant technical training and attend seminars
organised by The Institute of Internal Auditors, Singapore and other professional bodies. FPL Group IA operates within
the framework of a set of terms of reference as contained in the Internal Audit Charter approved by the ARCC. It adopts a
risk-based audit methodology to develop its audit plan, and its activities are aligned to key risks of FCT. The results of the
risk assessments determine the level of focus and the review intervals for the various activities audited. Higher risk areas
are subject to more intense reviews which are also carried out more frequently. FPL Group IA conducts its reviews based
on the internal audit plan approved by the ARCC. FPL Group IA has unfettered access to all of FCT’s and the Manager’s
documents, records, properties and personnel, including access to the ARCC members. All audit reports detailing audit
findings and recommendations are provided to Management who would respond with the actions to be taken.
Each quarter, FPL Group IA will submit reports to the ARCC on the status of the audit plan and on audit findings and
actions taken by Management on such findings. Key findings are highlighted at ARCC meetings for discussion. The ARCC
monitors the timely and proper implementation of the required follow-up measures undertaken by Management. The
ARCC is satisfied that for FY20, the internal audit function is independent, effective and adequately resourced and has
appropriate standing within FCT and the Manager to perform its functions effectively. Quality assurance reviews on FPL
Group’s internal audit function are periodically carried out by qualified professionals from an external organisation. The
last review was performed in the financial year ended 30 September 2018.
Related/Interested Person Transactions
The Manager has established internal processes such that the Board, with the assistance of the ARCC, is required to
be satisfied that all Related/Interested Person Transactions are undertaken on normal commercial terms, and are not
prejudicial to the interests of FCT and the Unitholders. This may entail obtaining (where practicable) quotations from
parties unrelated to the Manager, or obtaining one or more valuations from independent professional valuers (in
accordance with the Property Funds Appendix). Directors who are interested in any proposed Related/Interested Person
Transaction to be entered into by FCT are required to abstain from any deliberations or decisions in relation to that
Related/Interested Person Transaction.
All Related/Interested Person Transactions are entered in a register maintained by the Manager. The Manager
incorporates into its internal audit plan a review of the Related/Interested Person Transactions recorded in the register
to ascertain that internal procedures and requirements of the SGX-ST Listing Manual and Property Funds Appendix have
been complied with. The ARCC reviews the internal audit reports at least twice a year to ascertain that the guidelines
and procedures established to monitor Related/Interested Person Transactions have been complied with. The review
includes the examination of the nature of the Related/Interested Person Transactions and its supporting documents or
such other data deemed necessary by the ARCC. In addition, the Trustee also has the right to review any such relevant
internal audit reports to ascertain that the Property Funds Appendix has been complied with.
Any Related/Interested Person Transaction proposed to be entered into between FCT and an interested person, would
require the Trustee to satisfy itself that such Related/Interested Person Transaction is conducted on normal commercial
terms, is not prejudicial to the interests of FCT and its Unitholders, and is in accordance with all applicable requirements
of the CIS Code and the SGX-ST Listing Manual.
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CORPORATEGOVERNANCE REPORT 1 2 8 / F R A S E R S C E N T R E P O I N T T R U S T
Whistle-Blowing Policy
The Manager has put in place a whistle-blowing policy (the “Whistle-Blowing Policy”). The Whistle-Blowing Policy
provides an independent feedback channel through which matters of concern about possible improprieties in matters of
financial reporting, suspected fraud and corruption or other matters may be raised by employees and any other persons
in confidence and in good faith, without fear of reprisal. Whistle-Blowers may report any matters of concern by mail,
email or calling a hotline, details of which are provided in the Whistle-Blowing Policy, which is available on FCT’s website.
Any report submitted through this channel would be received by the Head of the internal audit function. For employees,
the Whistle-Blowing Policy provides assurance that employees will be treated fairly, and protected from reprisals or
victimisation for whistle-blowing in good faith.
The improprieties that are reportable under the Whistle-Blowing Policy include: (a) financial or professional misconduct;
(b) improper conduct, dishonest, fraudulent or unethical behaviour; (c) any irregularity or non-compliance with laws/
regulations or the Manager’s policies and procedures, and/or internal controls; (d) violence at the workplace, or
any conduct that may threaten health and safety; (e) corruption or bribery; (f) conflicts of interest; and (g) any other
improprieties or matters that may adversely affect Unitholders’/shareholders’ interests in, and assets of, FCT/the
Manager as well as FCT’s/the Manager’s reputation. The Whistle-Blowing Policy is covered during staff training. All
whistle-blowing complaints raised are independently investigated and if appropriate, an investigation committee will
be constituted. The outcome of each investigation and any action taken is reported to the ARCC. The ARCC reviews and
ensures that independent investigations and any appropriate follow-up actions are carried out.
UNITHOLDER MATTERS
The Manager treats all Unitholders fairly and equitably in order to enable them to exercise their Unitholders’ rights and
have the opportunity to communicate their views on matters affecting FCT.
Investor Relations
The Manager prides itself on its high standards of disclosure and corporate transparency. The Manager aims to provide
accurate, objective and timely information regarding FCT’s performance and progress and matters concerning FCT
and its business which are likely to materially affect the price or value of the Units, to Unitholders and the investment
community, to enable them to make informed investment decisions.
The Manager’s dedicated (“IR”) manager is tasked with, and focuses on, facilitating communications between FCT and
its Unitholders, as well as with the investment community, analysts and media. Contact details of the IR manager (“IR
Contact”) are available on FCT’s website at https://www.frasersproperty.com/reits/fct for Unitholders, investors and
other stakeholders to channel their comments and queries.
Continuous and informed dialogue between the Manager and Unitholders is a central tenet of good corporate
governance. Regular engagement between these parties will promote greater transparency. Material and other pertinent
information such as press releases and presentation slides are released to the SGX-ST via SGXNET and FCT’s website.
Announcements through SGXNET and FCT’s website are the principal media of communication with Unitholders. The
Management (including the IR manager) participates in investor conferences, roadshows, and one-on-one meetings
(including virtual meetings) to keep the investment community informed of FCT’s corporate developments, financial
and operational performance and strategies. Analysts’ briefings, conference calls and/or investors’ post-results calls
were conducted after the announcements of FY20 financial results/business updates for each quarter. Webcasts of the
Manager’s presentations of FCT’s half year and full year results are available on FCT’s website on the day of release of the
respective results.
Details of the IR activities during the year can be found in the Investor Relations section of this Annual Report on pages
22 to 24.
CORPORATEGOVERNANCE REPORT A N N U A L R E P O R T 2 0 2 0 / 1 2 9
An electronic copy of this Annual Report is available on FCT’s website at https://fct.frasersproperty.com/publications. html.
Unitholders can also request for printed copies of this Annual Report via IR Contact.
The Trust Deed is also available for inspection upon request at the Manager’s office1.
Conduct of general meetings
In view of the COVID-19 pandemic, the forthcoming 12th Annual General Meeting (“AGM 2021”) will be held on
21 January 2021 via electronic means pursuant to the COVID-19 (Temporary Measures) (Alternative Arrangements for
Meetings for Companies, Variable Capital Companies, Business Trusts, Unit Trusts and Debenture Holders) Order 2020
(“COVID-19 Temporary Measures Order”). Alternative arrangements relating to attendance at the AGM 2021 (including
arrangements by which the AGM 2021 can be electronically accessed via live audio-visual webcast or live audio-only
stream, submission of questions in advance of the AGM 2021, addressing of substantial and relevant questions prior to
or at the AGM 2021 and voting by appointing the chairman of the meeting as proxy at the AGM 2021) are set out in the
Manager’s announcement dated 29 December 2020. The description below sets out FCT’s usual practice for Unitholders
meetings when there are no pandemic risks and the COVID-19 Temporary Measures Order is not in operation.
The Board supports and encourages active Unitholder participation at AGMs as it believes that general meetings serve
as an opportune forum for Unitholders to meet the Board and senior Management, and to interact with them. As and
when an extraordinary general meeting is convened, a circular is sent to Unitholders, containing details of the matters
proposed for Unitholders’ consideration and approval. To encourage participation, FCT’s general meetings are held at
convenient locations. Unitholders are given the opportunity to participate effectively and vote at FCT’s general meetings,
where relevant rules and procedures governing such meetings (for instance, how to vote) are clearly communicated prior
to the start of the meeting.
At general meetings, the Manager sets out separate resolutions on each substantially separate issue. Unitholders are
given the opportunity to raise questions and clarify any issues that they may have relating to the resolutions sought to
be passed.
For greater transparency, the Manager has implemented electronic poll voting at general meetings. This entails
Unitholders being invited to vote on each of the resolutions by poll, using an electronic voting system (instead of voting
by hands), thereby allowing all Unitholders present or represented at the meeting to vote on a one Unit, one vote basis.
The voting results of all votes cast for, against, or abstaining from each resolution is then screened at the meeting and
announced to the SGX-ST after the meeting. An independent external party is appointed as scrutineer for the electronic
voting process to count and validate the votes at general meetings.
At the AGM, the Manager will make a presentation to update Unitholders on FCT’s financial and operational performance
for the financial year. The presentation materials are made available on SGXNET and FCT’s website before the
commencement of the AGM for the benefit of Unitholders.
Board members and senior Management are present at each Unitholders’ meeting to respond to any questions
from Unitholders, unless they are unable to attend due to exigencies. Certain external consultants including FCT’s
external auditors are also present to address queries about the conduct of audit and the preparation and content of
the auditors’ report.
The minutes of Unitholders’ meetings which include the attendance of Board members at the meetings, matters approved
by Unitholders, voting results and substantial and relevant comments or queries from Unitholders relating to the agenda
of the general meeting together with responses from the Board and Management, are prepared by the Manager. The
minutes will be available on FCT’s website after the Board’s approval.
1
Prior appointment with the Manager is appreciated.
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CORPORATEGOVERNANCE REPORT 1 3 0 / F R A S E R S C E N T R E P O I N T T R U S T
Distributions
FCT’s distribution policy is to distribute at least 90.0% of its taxable income, comprising substantially its income from
the letting of its properties and related property maintenance services income after deduction of allowable expenses
and such distributions are typically paid on a quarterly basis. Following the amendments to Rule 705(2) of the SGX-ST
Listing Manual which took effect from 7 February 2020, the Manager announced on 13 May 2020 that it would cease
to announce its financial statements on a quarterly basis and would announce its financial statements on a half-yearly
basis, commencing from the financial results announcement for the full-year ended 30 September 2020. The Manager
also announced on 13 May 2020 that FCT will make distributions at half-yearly intervals with effect from the second half
of FY20. For FY20, FCT made three distributions to Unitholders.
STAKEHOLDER ENGAGEMENT
The Board adopts an inclusive approach by considering and balancing the needs and interests of material stakeholders,
as part of its overall responsibility to ensure that the best interests of FCT are served.
Code of Business Conduct
The conduct of employees of the Manager is governed by the FPL Code of Business Conduct. The FPL Group’s business
practices have been governed by integrity, honesty, fair dealing and compliance with applicable laws. To guide FPL
Group’s employees across its multi-national network to uphold these values, FPL has established the FPL Code of
Business Conduct to provide clear guidelines on ethics and relationships to safeguard the interests and reputation of the
FPL Group, including the Manager, as well as its stakeholders.
The Code of Business Conduct has been recently updated in FY20 to keep current with today’s business practices and
requirements. The updated policy covers key aspects such as avoiding conflicts of interest, working with external
stakeholders (customers, suppliers, busines partners, governments and regulatory officials), protecting company’s
assets, social media engagement, data privacy and upholding laws in countries where the FPL Group has geographical
presence in. The updated Code of Business Conduct also emphasises the importance of upholding FPL’s core values
to build a respectful culture. Employees are encouraged to be respectful to the elements that make people similar or
different from one another, including background, views, experiences, capabilities, values, beliefs, physical differences,
ethnicity and culture, gender, age, thinking styles, preferences and behaviours.
The Code of Business Conduct sets out the policies and procedures dealing with various issues such as conflicts of
interests, the maintenance of records and reports, equal employment opportunities and sexual harassment. It includes
requirements relating to the keeping of accurate and sufficiently detailed accounting records for financial transactions,
internal financial reporting and financial reporting to stakeholders, sets out the standards to which employees must
adhere in their business relationships with third parties and personal business undertakings and their obligations to the
FPL Group, and provides for the need to obtain approval in certain situations where a conflict of interest may arise. It also
covers an employee’s obligations in protecting the FPL Group’s confidential information and intellectual property and
reiterates the FPL Group’s zero tolerance approach to bribery and corruption.
Where applicable/appropriate, the Code of Business Conduct is also made available to other stakeholders such as the
Manager’s agents, suppliers, business associates and customers.
CORPORATEGOVERNANCE REPORT A N N U A L R E P O R T 2 0 2 0 / 1 3 1
Anti-Money Laundering and Countering the Financing of Terrorism Measures
The Manager has a policy and procedures in place to comply with applicable anti-money laundering, counter-terrorism
financing laws and regulations, including the notice and guidelines issued by the MAS to capital intermediaries on the
prevention of money laundering and countering the financing of terrorism. The Manager’s policy and procedures include,
but are not limited to, risk assessment and mitigation, customer due diligence, reporting of suspicious transactions, and
record keeping. Training on anti-money laundering, counter-terrorism financing laws and regulations are also conducted
for employees, officers and representatives periodically and as and when needed.
Business Continuity Management
FCT has in place a Group Business Continuity Management (“BCM”) Policy which referenced the requirements of
ISO22301 management system. The policy sets the directives and guides the Manager in implementing and maintaining
a BCM management programme to protect against, reduce the likelihood of the occurrence of, prepare for, respond to
and recover from disruptions when they arise. The Group Business Continuity Management Committee oversees FCT’s
BCM programme and activities.
The Manager is in the midst of enhancing its BCM programme that will boost its resilience and capability in responding,
managing, and recovery from adverse business disruptions and unforeseen catastrophic events. Management has
strengthened its Crisis Management Plan, Business Continuity Plans and Emergency Response Plans to prepare themselves
in case of disruptions that may negatively impact on the business. Under the programme, critical business functions, key
processes, resource requirements and business recovery strategies are identified. Annual tests, exercises (tabletop or
simulated) and drills, simulating different scenarios, will be carried out to assess the effectiveness of the plans. Crisis
Management Team and staff are trained periodically, and the plans are updated regularly. The BCM programme ensures
FCT is resilient in the face of a crisis. It is a holistic approach to minimise adverse business impact and to safeguard FCT’s
reputation and business operations.
The Code of Business Conduct, the BCM Policy and the other policies are accessible to all employees on the FPL
Group intranet.
Sustainability
In order to review and assess the material factors relevant to FCT’s business activities, the Manager from time to time
proactively engages with various stakeholders, including employees, vendors and tenants, and the investment community,
to gather feedback on the sustainability matters which have significant impact to the business and operations of FCT
and its stakeholders. Please refer to the Sustainability Report on pages 74 to 100 of this Annual Report, which sets out
information on the Manager’s arrangements to identify and engage with its material stakeholder groups and to manage
its relationships with such groups, and the Manager’s strategy and key areas of focus in relation to the management of
stakeholder relationships during FY20.
Contents
CORPORATEGOVERNANCE REPORT 1 3 2 / F R A S E R S C E N T R E P O I N T T R U S T
POLICY ON DEALINGS IN SECURITIES
The Manager has established a dealing policy on securities trading (“Dealing Policy”) setting out the procedure for
dealings in FCT’s securities by its Directors, officers and employees. In compliance with Rule 1207(19) of the SGX-
ST Listing Manual on best practices on dealing in securities, the Group issues quarterly reminders to its Directors,
officers and employees on the restrictions in dealings in listed securities of the Group during the period commencing
(a) two weeks prior to the announcement of financial results of each of the first three quarters of the financial year,
and (b) one month before the announcement of full year results, and ending on the date of such announcements, and
following the Manager’s announcement on the SGXNET on 13 May 20202, the period commencing (a) two weeks prior
to the announcement of the interim business updates of the first and third quarters of the financial year, and (b) one
month before the announcement of the half-year and full year results, and ending on the date of such announcements
(“Prohibition Period”). Directors, officers and employees are also reminded not to trade in listed securities of FCT at any
time while in possession of unpublished price sensitive information and to refrain from dealing in FCT’s securities on
short-term considerations. Pursuant to the SFA, Directors and the CEO are also required to report their dealings in FCT’s
securities within two business days.
Every quarter, each Director, officer and employee is required to complete and submit a declaration form to the
designated compliance officer to report any trades he/she made in Units in the previous quarter and confirm that no
trades were made during the Prohibition Period. A quarterly report will be provided to the ARCC. Any non-compliance
with the Dealing Policy will be reported to the ARCC for its review and instructions.
In compliance with the Dealing Policy in relation to the Manager, prior approval from the Board is required before the
Manager deals or trades in Units. The Manager has undertaken that it will not deal in Units:
(i)
during the period commencing (A) two weeks prior to the announcement of the interim business updates of the
first and third quarters of the financial year, and (B) one month before the announcement of the half-year and full
year results and (where applicable) property valuations, and ending on the date of such announcements; or
(ii)
whenever it is in possession of unpublished material price sensitive information.
ADDITIONAL DISCLOSURE ON FEES PAYABLE TO THE MANAGER
Pursuant to the Trust Deed, the Manager is entitled to receive the following fees:
Type of Fee
Computation and Form of Payment
Rationale and Purpose
Base Fee
Pursuant to Clause 15.1.1 of the Trust Deed, the
Manager is entitled to receive a Base Fee not
exceeding the rate of 0.3% per annum of the
Value of FCT’s Deposited Property.
The Base Fee is payable quarterly in the form of
cash and/or Units as the Manager may elect.
The Base Fee compensates the Manager
for the costs
in managing
incurred
FCT, which
includes overheads, day-
to-day operational costs, compliance,
monitoring and reporting costs as well
as administrative expenses.
The Base Fee is calculated at a fixed
percentage of asset value as the scope of
the Manager’s duties is commensurate
with the size of FCT’s asset portfolio.
2
Following the amendments to Rule 705(2) of the SGX-ST Listing Manual which took effect from 7 February 2020, the Manager announced on 13 May 2020
that it would cease to announce its financial statements on a quarterly basis and would announce its financial statements on a half-yearly basis, commencing
from the financial results announcement for the full-year ended 30 September 2020. The Manager would provide business updates to Unitholders for the
first and third quarter performance of FCT, commencing with the third quarter ended 30 June 2020.
CORPORATEGOVERNANCE REPORT
A N N U A L R E P O R T 2 0 2 0 / 1 3 3
ADDITIONAL DISCLOSURE ON FEES PAYABLE TO THE MANAGER (CONT’D)
Type of Fee
Computation and Form of Payment
Rationale and Purpose
Performance Fee
Acquisition Fee
Pursuant to Clause 15.1.2 of the Trust Deed, the
Manager is entitled to receive a Performance
Fee equal to a rate of 5.0% per annum of the
Net Property Income of FCT (calculated before
accounting for the Performance Fee in that
financial year) or (as the case may be) Special
Purpose Vehicles for each Financial Year accrued
to the Manager and remaining unpaid.
The Performance Fee is payable in the form of
cash and/or Units as the Manager may elect.
from 1 October 2016,
With effect
the
Performance Fee shall be paid annually, in
compliance with the Property Funds Appendix.
Pursuant to Clause 15.2.1(i) of the Trust Deed, the
Manager is entitled to receive an Acquisition Fee
not exceeding the rate of 1.0% of the acquisition
price upon the completion of an acquisition.
Subject to the Property Funds Appendix, the
Acquisition Fee is payable as soon as practicable
after completion of the acquisition in the form
of cash and/or Units as the Manager may elect.
The Performance Fee, which is based on
Net Property Income, aligns the interests
of the Manager with Unitholders as the
Manager is incentivised to proactively
focus on improving rentals and optimising
the operating costs and expenses of FCT’s
properties. Linking the Performance Fee
to Net Property Income will also motivate
the Manager to ensure the long-term
sustainability of the assets instead of
taking on excessive short-term risks to
the detriment of Unitholders.
The Acquisition Fee and Divestment Fee
seek to motivate and compensate the
Manager for the time, cost and effort
spent (in the case of an acquisition) in
sourcing, evaluating and executing
potential opportunities to acquire new
properties to further grow FCT’s asset
portfolio or, (in the case of a divestment) in
rebalancing and unlocking the underlying
value of the existing properties.
The Manager provides these services
over and above the provision of ongoing
management services with the aim of
enhancing long-term returns, income
sustainability
the
investment objectives of FCT.
achieving
and
Divestment Fee
Pursuant to Clause 15.2.1(ii) of the Trust Deed,
the Manager is entitled to receive a Divestment
Fee not exceeding the rate of 0.5% of the sale
price upon the completion of a sale or disposal.
Subject to the Property Funds Appendix,
the Divestment Fee is payable as soon as
practicable after completion of the sale or
disposal in the form of cash and/or Units as the
Manager may elect.
Note:
Capitalised terms used in this section shall have the same meanings ascribed to them in the Trust Deed.
The Acquisition Fee is higher than the
Divestment Fee because there is additional
work required to be undertaken in terms of
sourcing, evaluating and conducting due
diligence for an acquisition, as compared
to a divestment.
Contents
CORPORATEGOVERNANCE REPORT
1 3 4 / F R A S E R S C E N T R E P O I N T T R U S T
SUMMARY OF COMPLIANCE WITH EXPRESS DISCLOSURE REQUIREMENTS IN PRINCIPLES AND PROVISIONS OF CG CODE
Page
Reference
of Annual
Report
2020
109
106 to 108
103 to 108
107
111
105 and
110 to 111
112 to 116
Principles and Provisions of the 2018 Code of Corporate Governance
BOARD’S CONDUCT OF AFFAIRS
Provision 1.2
Induction, training and development provided to new and existing
Directors
Provision 1.3
Matters requiring Board approval
Provision 1.4
Names of Board Committee members, terms of reference of Board
Committees, any delegation of Board’s authority to make decisions
and a summary of each Board Committee’s activities
Provision 1.5
Number of Board and Board Committee meetings and each individual
Directors’ attendances at such meeting
BOARD COMPOSITION AND GUIDANCE
Provision 2.2
The Board diversity policy and progress made towards implementation
of the policy, including objectives
BOARD MEMBERSHIP
Provision 4.3
Provision 4.4
Provision 4.5
BOARD PERFORMANCE
Provision 5.2
Process for the selection, appointment and re-appointment of
Directors to the Board, including the criteria used to identify and
evaluate potential new Directors and channels used in searching for
appropriate candidates
Relationships that independent Directors have with FCT, its related
corporations, its substantial Unitholders or its officers, if any, which
may affect their independence, and the reasons why the Board, having
taken into account the views of the NRC, has determined that such
Directors are still independent
Listed company directorships and principal commitments of each
Director, and where a Director holds a significant number of such
directorships and commitments, the NRC’s and Board’s reasoned
assessment of the ability of the Director to diligently discharge his or
her duties
16 to 19 and
112 to 116
How the assessments of the Board, its Board Committees and each
Director have been conducted, including the identity of any external
facilitator and its connection, if any, with the Manager or any of
its Directors
105 to 117
CORPORATEGOVERNANCE REPORT A N N U A L R E P O R T 2 0 2 0 / 1 3 5
SUMMARY OF COMPLIANCE WITH EXPRESS DISCLOSURE REQUIREMENTS IN PRINCIPLES AND PROVISIONS OF CG CODE
(CONT’D)
Principles and Provisions of the 2018 Code of Corporate Governance
PROCEDURES FOR DEVELOPING REMUNERATION POLICIES
Page
Reference
of Annual
Report
2020
Provision 6.4
Engagement of any remuneration consultants and their independence
118 and 121
DISCLOSURE ON REMUNERATION
Provision 8.1
Policy and criteria for setting remuneration, as well as names, amounts
and breakdown of remuneration of:
117 to 123
Provision 8.2
(a)
each individual Director and the CEO; and
(b)
at least the top five key management personnel (who are
not Directors or the CEO) in bands no wider than S$250,000
and in aggregate the total remuneration paid to these key
management personnel
Names and remuneration of employees who are substantial
shareholders of the Manager or substantial Unitholders, or are
immediate family members of a Director, the CEO or such a substantial
shareholder or substantial Unitholder, and whose remuneration
exceeds S$100,000 during the year,
in bands no wider than
S$100,000. The employee’s relationship with the relevant Director or
the CEO or substantial shareholder or substantial Unitholder should
also be stated.
123
Provision 8.3
All forms of remuneration and other payments and benefits, paid by
the Manager and its subsidiaries to Directors and Key Management
Personnel
117 to 123
RISK MANAGEMENT AND INTERNAL CONTROLS
Provision 9.2
Board’s assurance from:
126
(a)
(b)
the CEO and the CFO that the financial records have been
properly maintained and the financial statements give a true
and fair view of the REIT’s operations and finances; and
the CEO and other key management personnel who are
responsible, regarding the adequacy and effectiveness of the
REIT’s risk management and internal control systems.
Contents
CORPORATEGOVERNANCE REPORT 1 3 6 / F R A S E R S C E N T R E P O I N T T R U S T
SUMMARY OF COMPLIANCE WITH EXPRESS DISCLOSURE REQUIREMENTS IN PRINCIPLES AND PROVISIONS OF CG CODE
(CONT’D)
Principles and Provisions of the 2018 Code of Corporate Governance
UNITHOLDER RIGHTS AND ENGAGEMENT
UNITHOLDER RIGHTS AND CONDUCT OF GENERAL MEETINGS
Page
Reference
of Annual
Report
2020
Provision 11.3
Directors’ attendance at general meetings of Unitholders held during
the financial year
107 and 129
ENGAGEMENT WITH UNITHOLDERS
Provision 12.1
Steps taken by the Manager to solicit and understand the views
of Unitholders
128 to 129
ENGAGEMENT WITH STAKEHOLDERS
Provision 13.2
The Manager’s strategy and key areas of focus in relation to the
management of stakeholder relationships during the reporting period
128 to 131
CORPORATEGOVERNANCE REPORT A N N U A L R E P O R T 2 0 2 0 / 1 3 7
FINANCIAL STATEMENTS
CONTENTS
138 Report of the Trustee
139
Statement by the Manager
140
Independent Auditors’ Report
145 Balance Sheets
146
Statements of Total Return
147 Distribution Statements
148
Statements of Movements in Unitholders’
Funds and Reserves
149 Portfolio Statements
152 Consolidated Cash Flow Statement
154 Notes to the Financial Statements
1 3 8 / F R A S E R S C E N T R E P O I N T T R U S T
REPORT OF
THE TRUSTEE
HSBC Institutional Trust Services (Singapore) Limited (the “Trustee”) is under a duty to take into custody and hold the
assets of Frasers Centrepoint Trust (the “Trust”) and its subsidiaries (collectively, the “Group”) in trust for the holders
(“Unitholders”) of units in the Trust (the “Units”). In accordance with the Securities and Futures Act, Chapter 289 of
Singapore, its subsidiary legislation and the Code on Collective Investment Schemes, the Trustee shall monitor the
activities of Frasers Centrepoint Asset Management Ltd. (the “Manager”) for compliance with the limitations imposed on
the investment and borrowing powers as set out in the trust deed dated 5 June 2006 (as amended by a first supplemental
deed dated 4 October 2006, a first amending and restating deed dated 7 May 2009, a second supplemental deed dated
22 January 2010, a third supplemental deed dated 17 December 2015, a fourth supplemental deed dated 19 January
2017 and a fifth supplemental deed dated 24 January 2018) (the “Trust Deed”) between the Manager and the Trustee in
each annual accounting period and report thereon to Unitholders in an annual report.
To the best knowledge of the Trustee, the Manager has, in all material respects, managed the Trust during the period
covered by these financial statements set out on pages 145 to 211, in accordance with the limitations imposed on the
investment and borrowing powers set out in the Trust Deed.
For and on behalf of the Trustee,
HSBC Institutional Trust Services (Singapore) Limited
Authorised Signatory
Singapore
23 November 2020
A N N U A L R E P O R T 2 0 2 0 / 1 3 9
STATEMENT BY
THE MANAGER
In the opinion of the directors of Frasers Centrepoint Asset Management Ltd., the accompanying financial statements set
out on pages 145 to 211, comprising the consolidated balance sheet and consolidated portfolio statement of the Group
and the balance sheet and portfolio statement of the Trust as at 30 September 2020, and the consolidated statement
of total return, consolidated distribution statement, consolidated statement of movement in unitholders’ funds and
reserves and consolidated cash flow statement of the Group and the statement of total return, distribution statement,
statement of movements in unitholders’ funds and reserves of the Trust for the year then ended, and notes to the financial
statements, including a summary of significant accounting policies are drawn up so as to present fairly, in all material
respects, the consolidated financial position and the portfolio statement of the Group and the financial position and
the portfolio statement of the Trust as at 30 September 2020, the consolidated total return, consolidated distributable
income, consolidated movements in unitholders’ funds and reserves and consolidated cash flows of the Group and the
total return, distributable income, movements in unitholders’ funds and reserves of the Trust for the year then ended,
in accordance with the recommendations of Statement of Recommended Accounting Practice 7 Reporting Framework
for Unit Trusts issued by the Institute of Singapore Chartered Accountants and the provisions of the Trust Deed. At the
date of this statement, there are reasonable grounds to believe that the Group and the Trust will be able to meet their
financial obligations as and when they materialise.
For and on behalf of the Manager,
Frasers Centrepoint Asset Management Ltd.
Dr Cheong Choong Kong
Director
Low Chee Wah
Director
Singapore
23 November 2020
Contents
1 4 0 / F R A S E R S C E N T R E P O I N T T R U S T
INDEPENDENT
AUDITORS’ REPORT
TO THE UNITHOLDERS
FRASERS CENTREPOINT TRUST
(CONSTITUTED UNDER A TRUST DEED (AS AMENDED) IN THE REPUBLIC OF SINGAPORE)
REPORT ON THE AUDIT OF THE FINANCIAL STATEMENTS
Opinion
We have audited the financial statements of Frasers Centrepoint Trust (the “Trust”) and its subsidiaries (the “Group”),
which comprise the consolidated balance sheet and consolidated portfolio statement of the Group and the balance sheet
and portfolio statement of the Trust as at 30 September 2020, the consolidated statement of total return, consolidated
distribution statement, consolidated statement of movements in unitholders’ funds and reserves and consolidated cash
flow statement of the Group and the statement of total return, distribution statement and statement of movements in
unitholders’ funds and reserves of the Trust for the year then ended, and notes to the financial statements, including a
summary of significant accounting policies as set out on pages 145 to 211.
In our opinion, the accompanying consolidated financial statements of the Group and the balance sheet, statement of
total return, distribution statement and statement of movements in unitholders’ funds and reserves of the Trust present
fairly, in all material respects, the consolidated financial position and the consolidated portfolio holdings of the Group
and the financial position and the portfolio holdings of the Trust as at 30 September 2020 and the consolidated total
return, consolidated distributable income, consolidated movements in unitholders’ funds and reserves and consolidated
cash flows of the Group and the total return, distributable income and movements in unitholders’ funds and reserves
of the Trust for the year ended on that date in accordance with the recommendations of Statement of Recommended
Accounting Practice 7 (“RAP 7”) Reporting Framework for Unit Trusts issued by the Institute of Singapore Chartered
Accountants (the “ISCA”).
Basis for opinion
We conducted our audit in accordance with Singapore Standards on Auditing (“SSAs”). Our responsibilities under those
standards are further described in the ‘Auditors’ responsibilities for the audit of the financial statements’ section of our
report. We are independent of the Group in accordance with the Accounting and Corporate Regulatory Authority (“ACRA”)
Code of Professional Conduct and Ethics for Public Accountants and Accounting Entities (“ACRA Code”) together with
the ethical requirements that are relevant to our audit of the financial statements in Singapore, and we have fulfilled
our other ethical responsibilities in accordance with these requirements and the ACRA Code. We believe that the audit
evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the
financial statements of the current period. These matters were addressed in the context of our audit of the financial
statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.
A N N U A L R E P O R T 2 0 2 0 / 1 4 1
INDEPENDENT
AUDITORS’ REPORT
TO THE UNITHOLDERS
FRASERS CENTREPOINT TRUST
(CONSTITUTED UNDER A TRUST DEED (AS AMENDED) IN THE REPUBLIC OF SINGAPORE)
Valuation of investment properties
(Refer to Portfolio Statement and Note 4 to the financial statements)
Risk
The Group and the Trust own suburban retail malls located all around Singapore. These malls, classified as investment
properties, are all located within close proximity to Mass Rapid Transit stations and bus interchanges in populated
residential areas. As at 30 September 2020, the investment properties, with carrying amount of $2.75 billion (2019:
$2.85 billion), and asset held for sale, with carrying amount of $108 million (2019: Nil) , represent the single largest asset
category on the consolidated balance sheet of the Group and balance sheet of the Trust.
The investment properties are stated at their fair values based on independent external valuations. The valuation process
is considered a key audit matter because it involves significant judgement in determining the appropriate valuation
methodology to be used, and in estimating the underlying assumptions to be applied. The valuations are sensitive to key
assumptions applied in deriving future cash flows, the capitalisation rates, discount rates and terminal yield rates; where
a change in the assumptions can have a significant impact to the valuation.
The valuation reports obtained from the external valuers also highlighted that given the unprecedented set of
circumstances on which to base a judgement, less certainty and a higher degree of caution, should be attached to
their valuations than would normally be the case. Due to the unknown future impact of the 2019 Novel Coronavirus
(“COVID-19”) pandemic might have on the real estate market, the external valuers have also recommended to keep the
valuation of these properties under frequent review.
Our response
We evaluated the qualifications and competence of the external valuers and held discussions with the external valuers
to understand their valuation methods and assumptions and basis used, where appropriate.
We considered the valuation methodologies used against those applied by other valuers for similar property types. We
tested the integrity of inputs of the projected cashflows used in the valuation to supporting leases and other documents.
We evaluated the appropriateness of the discount, capitalisation and terminal yield rates used in the valuation by
comparing them against historical rates and available industry data, taking into consideration comparability and market
factors. Where the rates were outside the expected range, we undertook further procedures to understand the effect
of additional factors and, when necessary, held further discussions with the external valuers. We also discussed with
Manager and the external valuers to understand how they have considered the implications of COVID-19 and market
uncertainty in the valuations.
Our findings
We found the external valuers to be objective and competent. The external valuers are members of generally-recognised
professional bodies for valuers. The valuation methodologies used are in line with generally accepted market practices
and the key assumptions used are within the range of market data.
Accounting of acquisitions
(Refer to Note 7 to the financial statements)
Risk
The Group makes acquisitions as part of its business strategy. For the financial year ended 30 September 2020, the Group
acquired an additional 12.07% stake in AsiaRetail Fund Limited (“ARF”) for an aggregate considerations of $197.2 million.
Contents
1 4 2 / F R A S E R S C E N T R E P O I N T T R U S T
INDEPENDENT
AUDITORS’ REPORT
TO THE UNITHOLDERS
FRASERS CENTREPOINT TRUST
(CONSTITUTED UNDER A TRUST DEED (AS AMENDED) IN THE REPUBLIC OF SINGAPORE)
Such transactions can be complex and judgement is involved in determining whether each transaction is a business
combination or an acquisition of an asset, with different accounting treatment applicable. In accounting for a business
combination, judgements are applied and there exist inherent uncertainty in estimating the fair value of the identified
assets and liabilities that make up the acquisition; and allocating the overall purchase price to those identified assets and
liabilities, with any excess or shortfall being recognised as goodwill on the balance sheet or a bargain purchase in the
statements of total return respectively.
The assessment of this judgement is a key focus area of our audit.
Our response
We have assessed the accounting of the acquisitions by examining legal and contractual documents to determine
whether these acquisitions are business combinations or the acquisition of assets.
When an acquisition is determined to be a business combination, we read the purchase price allocation report and
assessed the allocation of the purchase price to significant identified assets and liabilities acquired. We compared the
methodologies and key assumptions used in deriving the significant allocated values to generally accepted market
practices and market data.
Our findings
The additional acquisition in ARF has been appropriately accounted for as a business combination. The methods and
assumptions used in estimating the fair values of significant identified assets and liabilities and the resulting allocation
in the purchase price were appropriate.
Other Information
Frasers Centrepoint Asset Management Ltd., the Manager of the Trust (the “Manager”), is responsible for the other
information contained in the annual report. Other information is defined as all information in the annual report other
than the financial statements and our auditors’ report thereon.
We have obtained all other information prior to the date of this auditors’ report except for the Statistics of Unitholdings
(the “Report”) which is expected to be made available to us after that date.
Our opinion on the financial statements does not cover the other information and we do not and will not express any
form of assurance conclusion thereon.
In connection with our audit of the financial statements, our responsibility is to read the other information identified
above and, in doing so, consider whether the other information is materially inconsistent with the financial statements
or our knowledge obtained in the audit, or otherwise appears to be materially misstated.
If, based on the work we have performed on the other information that we obtained prior to the date of this auditors’
report, we conclude that there is a material misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
When we read the Report, if we conclude that there is a material misstatement therein, we are required to communicate
the matter to the Manager and take appropriate actions in accordance with SSAs.
Responsibilities of the Manager for the financial statements
The Manager is responsible for the preparation and fair presentation of these financial statements in accordance with the
recommendations of RAP 7 issued by the ISCA, and for such internal control as the Manager determines is necessary to
enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.
A N N U A L R E P O R T 2 0 2 0 / 1 4 3
INDEPENDENT
AUDITORS’ REPORT
TO THE UNITHOLDERS
FRASERS CENTREPOINT TRUST
(CONSTITUTED UNDER A TRUST DEED (AS AMENDED) IN THE REPUBLIC OF SINGAPORE)
In preparing the financial statements, the Manager is responsible for assessing the Group’s ability to continue as a going
concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting
unless the Manager either intends to terminate the Group or to cease operations of the Group, or has no realistic
alternative but to do so.
The Manager’s responsibilities include overseeing the Group’s financial reporting process.
Auditors’ responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from
material misstatement, whether due to fraud or error, and to issue an auditors’ report that includes our opinion.
Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with
SSAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are
considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic
decisions of users taken on the basis of these financial statements.
As part of an audit in accordance with SSAs, we exercise professional judgement and maintain professional scepticism
throughout the audit. We also:
•
•
•
•
•
•
Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error,
design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and
appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from
fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions,
misrepresentations, or the override of internal controls.
Obtain an understanding of internal controls relevant to the audit in order to design audit procedures that are
appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the
Group’s internal controls.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and
related disclosures made by the Manager.
Conclude on the appropriateness of the Manager’s use of the going concern basis of accounting and, based on
the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast
significant doubt on the Group’s ability to continue as a going concern. If we conclude that a material uncertainty
exists, we are required to draw attention in our auditors’ report to the related disclosures in the financial
statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit
evidence obtained up to the date of our auditors’ report. However, future events or conditions may cause the
Group to cease to continue as a going concern.
Evaluate the overall presentation, structure and content of the financial statements, including the disclosures,
and whether the financial statements represent the underlying transactions and events in a manner that achieves
fair presentation.
Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business
activities within the Group to express an opinion on the consolidated financial statements. We are responsible for
the direction, supervision and performance of the group audit. We remain solely responsible for our audit opinion.
We communicate with the Manager regarding, among other matters, the planned scope and timing of the audit and
significant audit findings, including any significant deficiencies in internal controls that we identify during our audit.
Contents
1 4 4 / F R A S E R S C E N T R E P O I N T T R U S T
INDEPENDENT
AUDITORS’ REPORT
TO THE UNITHOLDERS
FRASERS CENTREPOINT TRUST
(CONSTITUTED UNDER A TRUST DEED (AS AMENDED) IN THE REPUBLIC OF SINGAPORE)
We also provide the Manager with a statement that we have complied with relevant ethical requirements regarding
independence, and communicate with them all relationships and other matters that may reasonably be thought to bear
on our independence, and where applicable, related safeguards.
From the matters communicated with the Manager, we determine those matters that were of most significance in the
audit of the financial statements of the current period and are therefore the key audit matters. We describe these matters
in our auditors’ report unless law or regulation precludes public disclosure about the matter or when, in extremely rare
circumstances, we determine that a matter should not be communicated in our report because the adverse consequences
of doing so would reasonably be expected to outweigh the public interest benefits of such communication.
The engagement partner on the audit resulting in this independent auditors’ report is Karen Lee Shu Pei.
KPMG LLP
Public Accountants and
Chartered Accountants
Singapore
23 November 2020
BALANCE
SHEETS
AS AT 30 SEPTEMBER 2020
Non-current assets
Investment properties
Fixed assets
Investment in subsidiaries
Investment in associates
Investment in joint ventures
Loan to joint venture
Current assets
Trade and other receivables
Cash and cash equivalents
Asset held for sale
Total assets
Current liabilities
Trade and other payables
Financial derivatives
Current portion of security deposits
Deferred income
Interest-bearing borrowings
Provision for taxation
Liabilities held for sale
Non-current liabilities
Financial derivatives
Interest-bearing borrowings
Non-current portion of security deposits
Total liabilities
Net assets
Represented by:-
Unitholders’ funds
Translation reserve
Hedging reserve
Unitholders’ funds and reserves
Units in issue (’000)
Net asset value per Unit ($)
* Denotes amount less than $500
A N N U A L R E P O R T 2 0 2 0 / 1 4 5
Note
Group
Trust
2020
$’000
2019
$’000
2020
$’000
2019
$’000
4
5
6
7
8
8
9
10
11
12
13
14
15
11
13
15
16
17
18
19
2,749,500
229
–
696,406
177,197
113,810
3,737,142
2,846,000
85
–
457,470
177,273
113,810
3,594,638
2,749,500
229
190,200
62,784
173,626
113,810
3,290,149
2,846,000
85
1
64,608
173,558
113,810
3,198,062
9,686
28,583
108,000
146,269
3,142
13,103
–
16,245
191,533
27,958
108,000
327,491
193,346
12,834
–
206,180
3,883,411
3,610,883
3,617,640
3,404,242
43,277
466
16,856
1
255,000
86
1,427
317,113
6,901
997,308
23,813
1,028,022
47,329
–
22,609
2
295,049
11
–
365,000
975
744,756
29,093
774,824
43,286
466
16,856
1
255,000
–
1,427
317,036
6,901
807,164
23,813
837,878
47,380
–
22,609
2
295,049
–
–
365,040
975
554,900
29,093
584,968
1,345,135
1,139,824
1,154,914
950,008
2,538,276
2,471,059
2,462,726
2,454,234
2,562,605
(18,999)
(5,330)
2,538,276
2,489,921
(18,829)
(33)
2,471,059
2,467,368
–
(4,642)
2,462,726
2,454,234
–
–
2,454,234
1,119,447
1,116,284
1,119,447
1,116,284
2.27
2.21
2.20
2.20
The accompanying accounting policies and explanatory notes form an integral part of the financial statements.
Contents
1 4 6 / F R A S E R S C E N T R E P O I N T T R U S T
STATEMENTS OF
TOTAL RETURN
FOR THE FINANCIAL YEAR ENDED 30 SEPTEMBER 2020
Note
Group
2020
$’000
2019
$’000
Trust
2020
$’000
2019
$’000
Gross revenue
Property expenses
Net property income
Interest income
Other income
Interest income from joint venture
Borrowing costs
Asset management fees
Valuation fees
Trustee’s fees
Audit fees
Other professional fees
Other charges
Net income
Distributions from subsidiary
Distributions from associate
Distributions from joint ventures
Share of results of associates
Share of results of joint ventures
Impairment loss on investment in joint venture
Impairment loss on investment in associate
Surplus on revaluation of investment properties
Unrealised loss from fair valuation of derivatives
Expenses in relation to acquisitions of an
associate and a joint venture
Total return before tax
Taxation
Total return for the year
Earnings per Unit (cents)
Basic
Diluted
20
21
22
23
24
7
8
4
25
26
164,377
(53,489)
110,888
196,386
(57,103)
139,283
164,377
(53,489)
110,888
196,386
(57,103)
139,283
14
586
2,211
(27,603)
(18,430)
(121)
(577)
(138)
(768)
(655)
65,407
–
–
–
75,280
11,200
–
–
4,747
(1,095)
–
131
587
(24,648)
(16,756)
(101)
(477)
(115)
(557)
(670)
96,677
–
–
–
22,548
6,409
(1,132)
–
93,290
(998)
(3,781)
151,758
(10,838)
205,956
(82)
151,676
(11)
205,945
14
–
2,211
(23,498)
(18,430)
(121)
(577)
(136)
(762)
(633)
68,956
11,909
1,629
10,579
–
–
–
(1,824)
4,747
(1,095)
(3,781)
91,120
–
91,120
–
–
587
(24,596)
(16,756)
(101)
(477)
(113)
(554)
(671)
96,602
7,060
3,547
2,920
–
–
(1,132)
–
93,290
(998)
(10,838)
190,451
–
190,451
13.57
20.78
13.55
20.74
8.15
8.14
19.22
19.18
The accompanying accounting policies and explanatory notes form an integral part of the financial statements.
DISTRIBUTION
STATEMENTS
FOR THE FINANCIAL YEAR ENDED 30 SEPTEMBER 2020
Income available for distribution to Unitholders
at beginning of year
Net income
Net tax adjustments (Note A)
Distribution from subsidiary
Distributions from associates
Distributions from joint ventures
Income available for distribution to Unitholders
Distributions to Unitholders:
Distribution of 2.862 cents per Unit for period
from 1/7/2018 to 30/9/2018
Distribution of 3.020 cents per Unit for period
from 1/10/2018 to 31/12/2018
Distribution of 3.137 cents per Unit for period
from 1/1/2019 to 31/3/2019
Distribution of 1.909 cents per Unit for period
from 1/4/2019 to 27/5/2019
Distribution of 1.091 cents per Unit for period
from 28/5/2019 to 30/6/2019
Distribution of 2.913 cents per Unit for period
from 1/7/2019 to 30/9/2019
Distribution of 3.060 cents per Unit for period
from 1/10/2019 to 31/12/2019
Distribution of 1.610 cents per Unit for period
from 1/1/2020 to 31/3/2020
A N N U A L R E P O R T 2 0 2 0 / 1 4 7
Group
2020
$’000
2019
$’000
Trust
2020
$’000
2019
$’000
32,551
65,407
(8,011)
–
33,171
10,579
101,146
133,697
–
–
–
–
–
32,553
34,202
18,000
84,755
27,483
96,677
8,368
–
10,753
2,920
118,718
146,201
26,550
28,021
29,158
17,746
12,175
–
–
–
113,650
32,548
68,956
8,073
11,909
1,629
10,579
101,146
133,694
–
–
–
–
–
32,553
34,202
18,000
84,755
27,480
96,602
8,589
7,060
3,547
2,920
118,718
146,198
26,550
28,021
29,158
17,746
12,175
–
–
–
113,650
Income available for distribution to Unitholders
at end of year
48,942
32,551
48,939
32,548
Distribution per unit (cents) *
9.042
12.070
9.042
12.070
Note A – Net tax adjustments relate to the following items:
– Asset management fees paid/payable in Units
– Amortisation of loan arrangement fees
– Amortisation of lease incentives
– Deferred income and amortisation of rental deposits
– Other items
Net tax adjustments
4,798
1,347
1,436
1
(15,593)
(8,011)
5,518
1,136
1,303
1
410
8,368
4,798
1,060
1,436
1
778
8,073
5,518
1,134
1,303
1
633
8,589
*
The Distribution per unit relates to the distributions in respect of the relevant financial year. The distribution relating to the 2nd half of 2020 will be paid after
30 September 2020.
The accompanying accounting policies and explanatory notes form an integral part of the financial statements.
Contents
1 4 8 / F R A S E R S C E N T R E P O I N T T R U S T
STATEMENTS OF MOVEMENTS IN
UNITHOLDERS’ FUNDS AND RESERVES
FOR THE FINANCIAL YEAR ENDED 30 SEPTEMBER 2020
Group
Trust
2020
$’000
2019
$’000
2020
$’000
2019
$’000
Net assets at beginning of year
2,471,059
1,933,756
2,454,234
1,932,054
Operations
Total return for the year
Unitholders’ transactions
Creation of Units
– proceeds from equity fund raising
– issued/issuable as satisfaction of asset management fees
– issued as satisfaction of acquisition fees
Issue expenses
Distributions to Unitholders
Net (decrease)/increase in net assets resulting from
Unitholders’ transactions
Share of movements in other reserves of an associate
and a joint venture
Movement in translation reserve (Note 16)
Movement in hedging reserve (Note 17)
151,676
205,945
91,120
190,451
–
4,798
1,972
(1)
(84,755)
(77,986)
437,366
5,518
8,999
(6,504)
(113,650)
331,729
–
4,798
1,972
(1)
(84,755)
(77,986)
437,366
5,518
8,999
(6,504)
(113,650)
331,729
(1,006)
(325)
–
(170)
(5,297)
(13)
(33)
–
(4,642)
–
–
–
Net assets at end of year
2,538,276
2,471,059
2,462,726
2,454,234
The accompanying accounting policies and explanatory notes form an integral part of the financial statements.
A N N U A L R E P O R T 2 0 2 0 / 1 4 9
PORTFOLIO
STATEMENTS
AS AT 30 SEPTEMBER 2020
GROUP
Description
of Property
Term of
Lease
Location
Existing
Use
Investment properties in Singapore
Occupancy
Rate as at
30 September
2020
%
At Valuation
2020
$’000
2019
$’000
Percentage of
Total Assets
2019
2020
%
%
Causeway Point
Northpoint City
North Wing
99-year
leasehold
from
30 October
1995
99-year
leasehold
from
1 April 1990
Anchorpoint
Freehold
YewTee Point
Bedok Point
Changi City
Point
99-year
leasehold
from
3 January
2006
99-year
leasehold
from
15 March
1978
60-year
leasehold
from
30 April
2009
Yishun 10 Retail
Podium
99-year
leasehold
from
1 April 1990
1 Woodlands
Square
930 Yishun
Avenue 2
368 & 370
Alexandra
Road
21 Choa Chu
Kang North 6
799 New Upper
Changi Road
5 Changi
Business Park
Central 1
51 Yishun
Central 1
Investment properties, at valuation
Asset held for sale in Singapore (Note 11)
Bedok Point
799 New Upper
Changi Road
99-year
leasehold
from
15 March
1978
Commercial
96.6 1,305,000
1,298,000
33.6
35.9
Commercial
96.2
771,500
771,500
19.9
21.4
Commercial
92.7
110,000
113,500
2.8
3.1
Commercial
97.1
190,000
189,000
4.9
5.2
Commercial
92.0
– (a)
94,000
–
2.6
Commercial
90.4
338,000
342,000
8.7
9.5
Commercial
68.8
35,000
38,000
0.9
1.1
2,749,500
2,846,000
70.8
78.8
Commercial
92.0
108,000 (a)
–
2.8
–
Investment in associates (Note 7)
Investment in joint ventures, including loan to joint venture (Note 8)
Other assets
Total assets attributable to Unitholders
(a) Classified as “Asset held for sale” as at 30 September 2020 (Note 11).
696,406
291,007
3,844,913
38,498
3,883,411
The accompanying accounting policies and explanatory notes form an integral part of the financial statements.
457,470
291,083
3,594,553
16,330
12.7
8.0
99.5
0.5
3,610,883 100.0 100.0
17.9
7.5
99.0
1.0
Contents
1 5 0 / F R A S E R S C E N T R E P O I N T T R U S T
PORTFOLIO
STATEMENTS
AS AT 30 SEPTEMBER 2020
TRUST
Description
of Property
Term of
Lease
Location
Existing
Use
Investment properties in Singapore
Occupancy
Rate as at
30 September
2020
%
At Valuation
2020
$’000
2019
$’000
Percentage of
Total Assets
2019
2020
%
%
Causeway Point
Northpoint City
North Wing
99-year
leasehold
from
30 October
1995
99-year
leasehold
from 1 April
1990
Anchorpoint
Freehold
YewTee Point
Bedok Point
Changi City
Point
99-year
leasehold
from
3 January
2006
99-year
leasehold
from
15 March
1978
60-year
leasehold
from
30 April
2009
Yishun 10 Retail
Podium
99-year
leasehold
from
1 April 1990
1 Woodlands
Square
930 Yishun
Avenue 2
368 & 370
Alexandra Road
21 Choa Chu
Kang North 6
799 New Upper
Changi Road
5 Changi
Business Park
Central 1
51 Yishun
Central 1
Investment properties, at valuation
Asset held for sale in Singapore (Note 11)
Bedok Point
799 New Upper
Changi Road
99-year
leasehold
from
15 March
1978
Commercial
96.6
1,305,000
1,298,000
36.1
38.1
Commercial
96.2
771,500
771,500
21.3
22.7
Commercial
92.7
110,000
113,500
3.0
3.3
Commercial
97.1
190,000
189,000
5.3
5.6
Commercial
92.0
– (a)
94,000
–
2.8
Commercial
90.4
338,000
342,000
9.3
10.0
Commercial
68.8
35,000
38,000
1.0
1.1
2,749,500
2,846,000
76.0
83.6
Commercial
92.0
108,000 (a)
–
3.0
–
Investment in associates (Note 7)
Investment in joint ventures, including loan to joint venture (Note 8)
Other assets
Total assets attributable to Unitholders
62,784
287,436
3,207,720
409,920
3,617,640
(a) Classified as “Asset held for sale” as at 30 September 2020 (Note 11).
The accompanying accounting policies and explanatory notes form an integral part of the financial statements.
64,608
287,368
3,197,976
206,266
1.9
8.4
93.9
6.1
3,404,242 100.0 100.0
1.7
8.0
88.7
11.3
A N N U A L R E P O R T 2 0 2 0 / 1 5 1
PORTFOLIO
STATEMENTS
AS AT 30 SEPTEMBER 2020
Independent valuations of the investment properties were undertaken by CBRE Pte Ltd (“CBRE”), Colliers International
Consultancy & Valuation (Singapore) Pte Ltd (“Colliers”) and Savills Valuation and Professional Services (S) Pte Ltd
(“ Savills”). Independent valuations of asset held for sale were undertaken by Jones Lang LaSalle LP (“JLL”) and Colliers.
The Manager believes that these independent valuers possess appropriate professional qualifications and recent
experience in the location and category of the investment properties being valued. The valuations were performed based
on the following methods:
Description of
Property
Valuer
Valuation Method
Investment Properties
Causeway Point
Savills
(2019: Savills)
Northpoint City
North Wing
Colliers
(2019: Colliers)
Anchorpoint
Colliers
(2019: Colliers)
YewTee Point
CBRE
(2019: CBRE)
Bedok Point
Not applicable
(2019: CBRE)
Changi City Point Savills
(2019: Savills)
Yishun 10 Retail
Podium
Savills
(2019: Savills)
Capitalisation approach, discounted cash flow
analysis and direct comparison method (2019:
Capitalisation approach, discounted cash flow
analysis and direct comparison method )
Capitalisation approach, discounted cash flow
analysis and direct comparison method (2019:
Capitalisation approach, discounted cash flow
analysis and direct comparison method)
Capitalisation approach, discounted cash flow
analysis and direct comparison method (2019:
Capitalisation approach, discounted cash flow
analysis and direct comparison method)
Capitalisation approach, discounted cash flow
analysis and direct comparison method (2019:
Capitalisation approach, discounted cash flow
analysis and direct comparison method)
Not applicable (2019: Capitalisation approach,
discounted cash flow analysis and direct
comparison method)
Capitalisation approach, discounted cash flow
analysis and direct comparison method (2019:
Capitalisation approach, discounted cash flow
analysis and direct comparison method)
Capitalisation approach, discounted cash flow
analysis and direct comparison method (2019:
Capitalisation approach, discounted cash flow
analysis and direct comparison method)
Valuation
2020
$’000
2019
$’000
1,305,000
1,298,000
771,500
771,500
110,000
113,500
190,000
189,000
– (a)
94,000
338,000
342,000
35,000
38,000
Asset held for sale in Singapore (Note 11)
Bedok Point
JLL & Colliers
(2019: Not applicable)
Residual method and direct comparison
method (2019:Not applicable)
108,000 (a)
--
(a) Classified as “Asset held for sale” as at 30 September 2020 (Note 11).
The net changes in fair values of these investment properties have been recognised in the Statements of Total Return in
accordance with the Group’s accounting policies.
The investment properties are leased to third party tenants. Generally, these leases contain an initial non-cancellable
period of three years. Subsequent renewals are negotiated with individual lessees. Contingent rent, which comprises
gross turnover rent, recognised in the Statements of Total Return of the Group and the Trust amounted to $7,824,000
(2019: $9,441,000).
The accompanying accounting policies and explanatory notes form an integral part of the financial statements.
Contents
1 5 2 / F R A S E R S C E N T R E P O I N T T R U S T
CONSOLIDATED CASH FLOW
STATEMENT
FOR THE FINANCIAL YEAR ENDED 30 SEPTEMBER 2020
Operating activities
Total return before tax
Adjustments for:
Allowance for doubtful receivables
Write back of allowance for doubtful receivables
Borrowing costs
Asset management and acquisition fees paid/payable in Units
Interest income
Depreciation of fixed assets
Amortisation of intangible assets
Share of associates’ results
Share of joint ventures’ results
Impairment loss on investment in joint venture
Surplus on revaluation of investment properties
Unrealised loss from fair valuation of derivatives
Amortisation of lease incentives
Deferred income recognised
Fixed assets write off
Operating income before working capital changes
Changes in working capital:
Trade and other receivables
Trade and other payables
Tax paid
Cash flows generated from operating activities
Investing activities
Distributions received from associates
Distributions received from joint ventures
Interest received
Capital expenditure on investment properties
Acquisition of fixed assets
Acquisition of investment in associate
Acquisition of investment in joint venture
Loan to a joint venture
Cash flows used in investing activities
Note
Group
2020
$’000
2019
$’000
151,758
205,956
1,297
(1,099)
27,603
6,770
(14)
56
–
(75,280)
(11,200)
–
(4,747)
1,095
1,436
(1)
6
97,680
(8,097)
(11,446)
(7)
78,130
34,017
10,579
14
(10,901)
(206)
(197,237)
(68)
–
(163,802)
8
(16)
24,648
14,517
–
93
12
(22,548)
(6,409)
1,132
(93,290)
998
1,303
(13)
–
126,391
255
4,109
–
130,755
9,907
2,920
–
(4,990)
(29)
(379,953)
(174,689)
(113,810)
(660,644)
The accompanying accounting policies and explanatory notes form an integral part of the financial statements.
CONSOLIDATED CASH FLOW
STATEMENT
FOR THE FINANCIAL YEAR ENDED 30 SEPTEMBER 2020
Financing activities
Proceeds from borrowings
Proceeds from issue of new units
Repayment of borrowings
Borrowing costs paid
Distributions to Unitholders
Payment of transaction costs
Payment of issue expenses
Cash flows generated from financing activities
Net increase/(decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year
Significant Non-Cash Transactions
A N N U A L R E P O R T 2 0 2 0 / 1 5 3
Note
Group
2020
$’000
2019
$’000
793,000
–
(580,083)
(25,755)
(84,755)
(1,254)
(1)
101,152
15,480
13,103
28,583
1,121,115
437,366
(892,032)
(22,627)
(113,650)
(2,540)
(6,504)
521,128
(8,761)
21,864
13,103
10
During the financial years, 1,994,085 (2019: 2,116,627) Units were issued and issuable in satisfaction of asset management
fees payable in Units, amounting to a value of $4,798,241 (2019: $5,518,174) in respect of the financial year.
827,060 units were issued on 11 August 2020 in satisfaction of acquisition fees of $1,972,373 in connection with the
acquisition of an additional stake of 12.07% in ARF completed on 6 July 2020. (2019: 1,445,217 and 141,216 units were
issued on 16 April 2019 and 6 May 2019 respectively in satisfaction of acquisition fees of $3,760,320 in connection with
the acquisition of ARF completed on 4 April and 26 April 2019 respectively. 1,819,199 units were issued on 17 July 2019
in satisfaction of acquisition fees of $4,333,333 in connection with the acquisition of 33⅓% stake in SST completed on
11 July 2019. 317,996 and 14,388 units were issued on 24 September 2019 in satisfaction of acquisition fees of $905,881
in connection with the acquisition of 6⅔% stake in SST completed on 18 September 2019 and payment of an additional
sum of $3.9 million in connection with the acquisition of ARF).
The accompanying accounting policies and explanatory notes form an integral part of the financial statements.
Contents
1 5 4 / F R A S E R S C E N T R E P O I N T T R U S T
The following notes form an integral part of the financial statements.
1.
GENERAL
Frasers Centrepoint Trust (the “Trust”) is a Singapore-domiciled unit trust constituted pursuant to a trust deed
dated 5 June 2006, and any amendment or modification thereof (the “Trust Deed”), between Frasers Centrepoint
Asset Management Ltd. (the “Manager”) and HSBC Institutional Trust Services (Singapore) Limited (the “Trustee”).
The Trust Deed is governed by the laws of the Republic of Singapore. The Trustee is under a duty to take into
custody and hold the assets of the Trust and its subsidiaries (collectively, the “Group”) in trust for the holders
(“Unitholders”) of units in the Trust (the “Units”). The address of the Trustee’s registered office is 10 Marina
Boulevard Marina Bay Financial Centre Tower 2 #48-01 Singapore 018983.
The Trust was formally admitted to the Official List of the Singapore Exchange Securities Trading Limited (“SGX-ST”)
on 5 July 2006 and was included in the Central Provident Fund Investment Scheme (“CPFIS”) on 5 July 2006.
The principal activity of the Trust is to invest in income-producing properties used primarily for retail purposes, in
Singapore and overseas, with the primary objective of delivering regular and stable distributions to Unitholders
and to achieve long-term capital growth. The principal activity of the subsidiaries is set out in Note 6.
The financial statements were authorised for issue by the Manager and the Trustee on 23 November 2020.
The Trust has entered into several service agreements in relation to management of the Trust and its property
operations. The fee structures of these services are as follows:
1.1
Property management fees
Under the property management agreements, fees are charged as follows:
(i)
2.0% per annum of the gross revenue of the properties;
(ii)
(iii)
2.0% per annum of the net property income of the properties (calculated before accounting for the property
management fees); and
0.5% per annum of the net property income of the properties (calculated before accounting for the property
management fees), in lieu of leasing commissions.
The property management fees are payable monthly in arrears.
1.2
Asset management fees
Pursuant to the Trust Deed, asset management fees comprise the following:
(i)
(ii)
a base fee equal to a rate of 0.3% per annum of the value of Deposited Property (being all assets, as
stipulated in the Trust Deed) of the Trust; and
an annual performance fee equal to a rate of 5.0% per annum of the Net Property Income (as defined
in the Trust Deed) of the Trust and any Special Purpose Vehicles (as defined in the Trust Deed) for each
financial year.
Any increase in the rate or any change in the structure of the asset management fees must be approved by an
Extraordinary Resolution of Unitholders passed at a Unitholders’ meeting duly convened and held in accordance
with the provisions of the Trust Deed.
NOTES TO THEFINANCIAL STATEMENTS30 SEPTEMBER 2020 A N N U A L R E P O R T 2 0 2 0 / 1 5 5
1.
GENERAL (CONT’D)
1.2
Asset management fees (cont’d)
The Manager may elect to receive the fees in cash or Units or a combination of cash and Units (as it may in its sole
discretion determine). For the year ended 30 September 2020, the Manager has opted to receive 20% to 50%
(2019: 20% to 55%) of the asset management fees in the form of Units with the balance in cash. The portion of the
base management fees is payable on a quarterly basis in arrears and the portion of the performance management
fees is payable on an annually basis in arrears.
The Manager is also entitled to receive acquisition fee at the rate of 1% of the acquisition price and a divestment
fee of 0.5% of the sale price on all future acquisitions or disposals of properties or investments.
1.3
Trustee’s fees
Pursuant to the Trust Deed, the Trustee’s fees shall not exceed 0.1% per annum of the value of Deposited Property
of the Trust, subject to a minimum of $9,000 per month, excluding out-of-pocket expenses and GST.
Any increase in the maximum permitted or any change in the structure of the Trustee’s fee must be approved by an
Extraordinary Resolution of Unitholders passed at a Unitholders’ meeting duly convened and held in accordance
with the provisions of the Trust Deed.
The Trustee’s fees are payable monthly in arrears.
2.
BASIS OF PREPARATION
2.1
Basis of preparation
The financial statements have been prepared in accordance with the recommendations of Statement of
Recommended Accounting Practice (“RAP”) 7 Reporting Framework for Unit Trusts issued by the Institute of
Singapore Chartered Accountants (“ISCA”), the applicable requirements of the Code on Collective Investment
Schemes (the “CIS Code”) issued by the Monetary Authority of Singapore (“MAS”) and the provisions of the Trust
Deed. RAP 7 requires the accounting policies to generally comply with the principles relating to recognition and
measurement under the Financial Reporting Standards in Singapore (“FRS”).
This is the first set of the Group’s annual financial statements in which FRS 116 Leases and amendments to
recognition and measurement principles of FRS 109 Financial Instruments, FRS 39 Financial Instruments:
Recognition and Measurement and FRS 107 Financial Instruments: Disclosures in relation to the project on interest
rate benchmark have been applied. The related changes to significant accounting policies are described in note 2.2.
The financial statements have been prepared on the historical cost basis except as otherwise described in the
notes below.
These financial statements are presented in Singapore dollars, which is the Trust’s functional currency. All financial
information presented in Singapore dollars have been rounded to the nearest thousand, unless otherwise stated.
The preparation of the financial statements in conformity with RAP 7 requires the Manager to make judgements,
estimates and assumptions that affect the application of accounting policies and the reported amounts of assets,
liabilities, income and expenses. Actual results may differ from these estimates.
The estimates and associated assumptions are based on historical experience and relevant factors, including
expectation of further events that are believed to be reasonable under the circumstances and are reviewed on an
ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimates are revised
and in any future periods affected.
Contents
NOTES TO THEFINANCIAL STATEMENTS30 SEPTEMBER 2020 1 5 6 / F R A S E R S C E N T R E P O I N T T R U S T
2.
BASIS OF PREPARATION (CONT’D)
2.1
Basis of preparation (cont’d)
Information about critical judgements in applying accounting policies that have the most significant effect on the
amounts recognised in the financial statements is included in the following notes:
(i)
Note 3.1(i) – Business combinations;
(ii)
Note 7 – Investment in associates; and
(iii)
Note 8 – Investment in joint ventures.
Information about assumptions and estimation uncertainties that have a significant risk of resulting in a material
adjustment within the next financial year are included in the following notes:
(i)
Note 4 – Valuation of investment properties; and
(ii)
Note 13 – Valuation of financial derivatives.
2.2
Changes in accounting policies
New standards and amendments
The Group has applied the following FRS, amendments to and interpretations of FRSs for the first time for the
annual period beginning on 1 October 2019:
•
•
•
•
•
•
•
•
FRS 116 Leases
FRS INT 123 Uncertainty over Income Tax Treatments
Long-term Interests in Associates and Joint Ventures (Amendments to FRS 28)
Prepayment Features with Negative Compensation (Amendments to FRS 109)
Previously Held Interest in a Joint Operation (Amendments to FRS 103 and 111)
Income Tax Consequences of Payments on Financial Instruments Classified as Equity (Amendments to FRS 12)
Borrowing Costs Eligible for Capitalisation (Amendments to FRS 23)
Plan Amendment, Curtailment or Settlement (Amendments to FRS 19)
In addition, the Group early adopted the amendments to recognition and measurement principles of FRS 109
Financial Instruments, FRS 39 Financial Instruments: Recognition and Measurement and FRS 107 Financial
Instruments: Disclosures on 1 October 2019 in relation to the project on interest rate benchmark reform. The
Group applied the interest rate benchmark reform amendments retrospectively to hedging relationship that
existed at 1 October 2019 or were designated thereafter and that are directly affected by interest rate benchmark
reform. These amendments also apply to the gain or loss accumulated in the hedging reserve in unitholders’ funds
and reserves that existed at 1 October 2019. The details of the accounting policies are disclosed in Notes 3.4(vi)
and 29(b)(ii) for related disclosures about the risks and hedge accounting.
Other than FRS 116, the application of these amendments to standards and interpretations does not have a
material effect on the financial statements.
NOTES TO THEFINANCIAL STATEMENTS30 SEPTEMBER 2020 A N N U A L R E P O R T 2 0 2 0 / 1 5 7
2.
BASIS OF PREPARATION (CONT’D)
2.2
Changes in accounting policies (cont’d)
FRS 116 Leases
The Group applied FRS 116 using the modified retrospective approach. Accordingly, the comparative information
presented for 2018 is not restated – i.e. it is presented, as previously reported, under FRS 17 and related
interpretations. The details of the changes in accounting policies are disclosed below. Additionally, the disclosure
requirements in FRS 116 have not generally been applied to comparative information.
Definition of a lease
Previously, the Group determined at contract inception whether an arrangement was or contained a lease under
INT FRS 104 Determining whether an Arrangement contains a Lease. The Group now assesses whether a contract
is or contains a lease based on the definition of a lease, as explained in FRS 116.
On transition to FRS 116, the Group elected to apply the practical expedient to grandfather the assessment of
which transactions are leases. The Group applied FRS 116 only to contracts that were previously identified as
leases. Contracts that were not identified as leases under FRS 17 and INT FRS 104 were not reassessed for whether
there is a lease under FRS 116. Therefore, the definition of a lease under FRS 116 was applied only to contracts
entered into or changed on or after 1 October 2019.
As a lessor
The Group leases out its investment property and has classified these leases as operating leases.
The Group is not required to make any adjustments on transition to FRS 116 for leases in which it acts as a lessor.
The Group has applied FRS 115 Revenue from Contracts with Customers to allocate consideration in the contract
to each lease and non-lease component.
Impact on financial statements
There is no impact to the Group on transition to FRS 116.
3.
SIGNIFICANT ACCOUNTING POLICIES
The accounting policies set out below have been applied by the Group entities consistently to all the periods
presented in these financial statements, except as explained in Note 2.2, which addresses changes in accounting
policies arising from the adoption of new standards.
3.1
Basis of consolidation
(i)
Business combinations
The Group accounts for business combinations using the acquisition method when control is transferred to
the Group.
The Group measures goodwill at the date of acquisition as:
•
•
•
the fair value of the consideration transferred; plus
the recognised amount of any non-controlling interest (“NCI”) in the acquiree; plus
if the business combination is achieved in stages, the fair value of the pre-existing equity interest in
the acquiree,
Contents
NOTES TO THEFINANCIAL STATEMENTS30 SEPTEMBER 2020 1 5 8 / F R A S E R S C E N T R E P O I N T T R U S T
3.
SIGNIFICANT ACCOUNTING POLICIES (CONT’D)
3.1
Basis of consolidation (cont’d)
(i)
Business combinations (cont’d)
over the net recognised amount (generally fair value) of the identifiable assets acquired and liabilities assumed.
Any goodwill that arises is tested annually for impairment.
When the excess is negative, a bargain purchase gain is recognised immediately in the statements of total return.
The consideration transferred does not include amounts related to the settlement of pre-existing relationships.
Such amounts are generally recognised in the statements of total return.
Any contingent consideration payable is recognised at fair value at the date of acquisition and included in the
consideration transferred. If the contingent consideration that meets the definition of a financial instrument is
classified as equity, it is not remeasured and settlement is accounted for within equity. Otherwise, other contingent
consideration is remeasured at fair value at each reporting date and subsequent changes to the fair value of the
contingent consideration are recognised in the statements of total return.
NCI (if any) that are present ownership interests and entitle their holders to a proportionate share of the acquiree’s
net assets in the event of liquidation are measured either at fair value or at the NCI’s proportionate share of the
recognised amounts of the acquiree’s identifiable net assets, at the date of acquisition. The measurement basis
taken is elected on a transaction-by-transaction basis. All other NCI are measured at acquisition-date fair value,
unless another measurement basis is required by FRSs.
Costs related to the acquisition, other than those associated with the issue of debt or equity investments, that the
Group incurs in connection with a business combination are expensed as incurred.
Changes in the Group’s interest in a subsidiary that do not result in a loss of control are accounted for as equity
transactions.
(ii)
Subsidiaries
A subsidiary is an entity controlled by the Group. The Group controls an entity when it is exposed to, or has rights to,
variable returns from its involvement with the entity and has the ability to affect those returns through its power
over the entity. The financial statements of a subsidiary are included in the consolidated financial statements from
the date that control commences until the date that control ceases.
The accounting policies of subsidiaries have been changed when necessary to align them with the policies adopted
by the Group. Losses applicable to the NCI in a subsidiary are allocated to the NCI even if doing so causes the NCI
to have a deficit balance.
In the Trust’s balance sheet, investment in subsidiary is accounted for at cost less any accumulated impairment losses.
When the Group loses control over a subsidiary, it derecognises the assets and liabilities of the subsidiary, and any
related NCI and other components of equity. Any resulting gain or loss is recognised in the statements of total
return. Any interest retained in the former subsidiary is measured at fair value when control is lost.
NOTES TO THEFINANCIAL STATEMENTS30 SEPTEMBER 2020 A N N U A L R E P O R T 2 0 2 0 / 1 5 9
3.
SIGNIFICANT ACCOUNTING POLICIES (CONT’D)
3.1
Basis of consolidation (cont’d)
(iii)
Investments in associates and joint ventures (equity-accounted investees)
An associate is an entity over which the Group has significant influence over the financial and operating policy
decisions of the investee but does not have control or joint control of those policies. Significant influence is
presumed to exist when the Group has 20% or more of the voting power of another entity.
A joint venture is an arrangement in which the Group has joint control, whereby the Group has rights to the net
assets of the arrangement, rather than rights to its assets and obligations for its liabilities.
Investments in associates and joint ventures are accounted for using the equity method. They are recognised
initially at cost, which includes transaction costs. Subsequent to initial recognition, the consolidated financial
statements include the Group’s share of the profit or loss and OCI of equity-accounted investees, after adjustments
to align the accounting policies with those of the Group, from the date that significant influence or joint control
commences until the date that significant influence or joint control ceases.
When the Group’s share of losses exceeds its investment in equity-accounted investee, the carrying amount of the
investment, together with any long-term interests that form part thereof, is reduced to zero, and the recognition
of further losses is discontinued except to the extent that the Group has an obligation to fund the investee’s
operations or has made payments on behalf of the investee.
The financial statements of the associates and joint ventures are prepared as the same reporting date as the Trust.
Where necessary, adjustments are made to bring the accounting policies in line with those of the Group.
In the Trust’s separate financial statements, interests in joint ventures and associates are carried at cost less
accumulated impairment losses.
A list of the associate and joint venture is shown in Notes 7 and 8, respectively.
(iv)
Transactions eliminated on consolidation
Intra-group balances and transactions, and any unrealised income and expenses arising from intra-group
transactions, are eliminated in preparing the consolidated financial statements. Unrealised gains arising from
transactions with equity-accounted investees are eliminated against the investment to the extent of the Group’s
interest in the investee. Unrealised losses are eliminated in the same way as unrealised gains, but only to the
extent that there is no evidence of impairment.
(v)
Property acquisitions and business combinations
Where property is acquired, via corporate acquisitions or otherwise, management considers the substance of the
assets and activities of the acquired entity in determining whether the acquisition represents the acquisition of a
business or the acquisition of an asset. The Group accounts for an acquisition as a business combination where an
integrated set of activities is acquired in addition to the property. More specifically, consideration is made of the
extent to which significant processes are acquired and, in particular, the extent of services provided by the subsidiary.
When the acquisition does not represent a business, it is accounted for as an acquisition of a group of assets and
liabilities. The cost of the acquisition is allocated to the assets and liabilities acquired based upon their relative fair
values, and no goodwill or deferred tax is recognised.
Contents
NOTES TO THEFINANCIAL STATEMENTS30 SEPTEMBER 2020 1 6 0 / F R A S E R S C E N T R E P O I N T T R U S T
3.
SIGNIFICANT ACCOUNTING POLICIES (CONT’D)
3.2
Earnings per unit
The Group presents basic and diluted earnings per unit data for its units. Basic earnings per unit is calculated
by dividing the total return attributable to Unitholders of the Group by the weighted-average number of units
outstanding during the year. Diluted earnings per unit is determined by adjusting the total return attributable to
Unitholders and the weighted-average number of units outstanding, for the effects of all dilutive potential units.
3.3
Expenses
(i)
Property expenses
Property expenses are recognised on an accrual basis. Included in property expenses are property management
fees which are based on the applicable formula stipulated in Note 1.1.
(ii)
Asset management fees
Asset management fees are recognised on an accrual basis based on the applicable formula stipulated in Note 1.2.
(iii)
Trust expenses
Trust expenses are recognised on an accrual basis. Included in trust expenses are Trustee’s fees which are based on
the applicable formula stipulated in Note 1.3.
3.4
Financial instruments
(i)
Recognition and initial measurement
Non-derivative financial assets and financial liabilities
Trade receivables are initially recognised when they are originated. All other financial assets and financial liabilities
are initially recognised when the Group becomes a party to the contractual provisions of the instrument.
A financial asset (unless it is a trade receivable without a significant financing component) or financial liability
is initially measured at fair value plus, for an item not at fair value through profit or loss (“FVTPL”), transaction
costs that are directly attributable to its acquisition or issue. A trade receivable without a significant financing
component is initially measured at the transaction price.
(ii)
Classification and subsequent measurement
Non-derivative financial assets
On initial recognition, a financial asset is classified as measured at: amortised cost; FVOCI – debt investment;
FVOCI – equity investment; or FVTPL.
Financial assets are not reclassified subsequent to their initial recognition unless the Group changes its business
model for managing financial assets, in which case all affected financial assets are reclassified on the first day of
the first reporting period following the change in the business model.
NOTES TO THEFINANCIAL STATEMENTS30 SEPTEMBER 2020 A N N U A L R E P O R T 2 0 2 0 / 1 6 1
3.
SIGNIFICANT ACCOUNTING POLICIES (CONT’D)
3.4
Financial instruments (cont’d)
(ii)
Classification and subsequent measurement (cont’d)
Financial assets at amortised cost
A financial asset is measured at amortised cost if it meets both of the following conditions and is not designated
as at FVTPL:
•
•
it is held within a business model whose objective is to hold assets to collect contractual cash flows; and
its contractual terms give rise on specified dates to cash flows that are solely payments of principal and
interest on the principal amount outstanding.
Financial assets at FVTPL
All financial assets not classified as measured at amortised cost or FVOCI are measured at FVTPL. On initial
recognition, the Group may irrevocably designate a financial asset that otherwise meets the requirements to be
measured at amortised cost or at FVOCI as at FVTPL if doing so eliminates or significantly reduces an accounting
mismatch that would otherwise arise.
Financial assets: Business model assessment
The Group makes an assessment of the objective of the business model in which a financial asset is held at a
portfolio level because this best reflects the way the business is managed and information is provided to
management. The information considered includes:
•
•
•
•
the stated policies and objectives for the portfolio and the operation of those policies in practice. These
include whether management’s strategy focuses on earning contractual interest income, maintaining a
particular interest rate profile, matching the duration of the financial assets to the duration of any related
liabilities or expected cash outflows or realising cash flows through the sale of the assets;
how the performance of the portfolio is evaluated and reported to the Group’s management;
the risks that affect the performance of the business model (and the financial assets held within that
business model) and how those risks are managed; and
the frequency, volume and timing of sales of financial assets in prior periods, the reasons for such sales and
expectations about future sales activity.
Transfers of financial assets to third parties in transactions that do not qualify for derecognition are not considered
sales for this purpose, consistent with the Group’s continuing recognition of the assets.
Contents
NOTES TO THEFINANCIAL STATEMENTS30 SEPTEMBER 2020 1 6 2 / F R A S E R S C E N T R E P O I N T T R U S T
3.
SIGNIFICANT ACCOUNTING POLICIES (CONT’D)
3.4
Financial instruments (cont’d)
(ii)
Classification and subsequent measurement (cont’d)
Non-derivative financial assets: Assessment whether contractual cash flows are solely payments of principal
and interest
For the purposes of this assessment, ‘principal’ is defined as the fair value of the financial asset on initial
recognition. ‘Interest’ is defined as consideration for the time value of money and for the credit risk associated
with the principal amount outstanding during a particular period of time and for other basic lending risks and
costs (e.g. liquidity risk and administrative costs), as well as a profit margin.
In assessing whether the contractual cash flows are solely payments of principal and interest, the Group considers
the contractual terms of the instrument. This includes assessing whether the financial asset contains a contractual
term that could change the timing or amount of contractual cash flows such that it would not meet this condition.
In making this assessment, the Group considers:
•
•
•
•
contingent events that would change the amount or timing of cash flows;
terms that may adjust the contractual coupon rate, including variable rate features;
prepayment and extension features; and
terms that limit the Group’s claim to cash flows from specified assets (e.g. non-recourse features).
A prepayment feature is consistent with the solely payments of principal and interest criterion if the prepayment
amount substantially represents unpaid amounts of principal and interest on the principal amount outstanding,
which may include reasonable additional compensation for early termination of the contract. Additionally, for a
financial asset acquired at a significant discount or premium to its contractual par amount, a feature that permits
or requires prepayment at an amount that substantially represents the contractual par amount plus accrued (but
unpaid) contractual interest (which may also include reasonable additional compensation for early termination) is
treated as consistent with this criterion if the fair value of the prepayment feature is insignificant at initial recognition.
Non-derivative financial assets: Subsequent measurement and gains and losses
Financial assets at FVTPL
These assets are subsequently measured at fair value. Net gains and losses, including any interest or dividend
income, are recognised in the statements of total return.
Financial assets at amortised cost
These assets are subsequently measured at amortised cost using the effective interest method. The amortised
cost is reduced by impairment losses. Interest income, foreign exchange gains and losses and impairment are
recognised in the statements of total return. Any gain or loss on derecognition is recognised in the statements of
total return.
NOTES TO THEFINANCIAL STATEMENTS30 SEPTEMBER 2020 A N N U A L R E P O R T 2 0 2 0 / 1 6 3
3.
SIGNIFICANT ACCOUNTING POLICIES (CONT’D)
3.4
Financial instruments (cont’d)
(ii)
Classification and subsequent measurement (cont’d)
Non-derivative financial liabilities: Classification, subsequent measurement and gains and losses
Financial liabilities are classified as measured at amortised cost or FVTPL. A financial liability is classified as at
FVTPL if it is classified as held-for-trading or it is designated as such on initial recognition. Financial liabilities at
FVTPL are measured at fair value and net gains and losses, including any interest expense, are recognised in the
statements of total return. Directly attributable transaction costs are recognised in the statements of total return
as incurred.
Other financial liabilities are initially measured at fair value less directly attributable transaction costs. They
are subsequently measured at amortised cost using the effective interest method. Interest expense and foreign
exchange gains and losses are recognised in the statements of total return.
(iii) Derecognition
Financial assets
The Group derecognises a financial asset when the contractual rights to the cash flows from the financial asset
expire, or it transfers the rights to receive the contractual cash flows in a transaction in which substantially all of
the risks and rewards of ownership of the financial asset are transferred or in which the Group neither transfers nor
retains substantially all of the risks and rewards of ownership and it does not retain control of the financial asset.
The Group enters into transactions whereby it transfers assets recognised in its balance sheets, but retains either
all or substantially all of the risks and rewards of the transferred assets. In these cases, the transferred assets are
not derecognised.
Financial liabilities
The Group derecognises a financial liability when its contractual obligations are discharged or cancelled, or expire.
The Group also derecognises a financial liability when its terms are modified and the cash flows of the modified
liability are substantially different, in which case a new financial liability based on the modified terms is recognised
at fair value.
On derecognition of a financial liability, the difference between the carrying amount extinguished and the
consideration paid (including any non-cash assets transferred or liabilities assumed) is recognised in the statements
of total return.
(iv) Offsetting
Financial assets and financial liabilities are offset and the net amount presented in the statements of financial
position when, and only when, the Group currently has a legally enforceable right to set off the amounts and it
intends either to settle them on a net basis or to realise the asset and settle the liability simultaneously.
Contents
NOTES TO THEFINANCIAL STATEMENTS30 SEPTEMBER 2020 1 6 4 / F R A S E R S C E N T R E P O I N T T R U S T
3.
SIGNIFICANT ACCOUNTING POLICIES (CONT’D)
3.4
Financial instruments (cont’d)
(v)
Cash and cash equivalents
Cash and cash equivalents comprise cash balances and short-term deposits with maturities of three months or
less from the date of acquisition that are subject to an insignificant risk of changes in their fair value, and are used
by the Group in the management of its short-term commitments.
(vi)
Derivative financial instruments and hedge accounting
The Group holds derivative financial instruments to hedge its interest rate risk exposures. Embedded derivatives
are separated from the host contract and accounted for separately if the host contract is not a financial asset and
certain criteria are met.
Derivatives are initially measured at fair value and any directly attributable transaction costs are recognised in the
statements of total return as incurred. Subsequent to initial recognition, derivatives are measured at fair value,
and changes therein are generally recognised in the statements of total return.
The Group designates certain derivatives and non-derivative financial instruments as hedging instruments in
qualifying hedging relationships. At inception of designated hedging relationships, the Group documents the
risk management objective and strategy for undertaking the hedge. The Group also documents the economic
relationship between the hedged item and the hedging instrument, including whether the changes in cash flows
of the hedged item and hedging instrument are expected to offset each other.
Applicable from 1 October 2019 for hedges directly affected by interest rate benchmark reform
For the purpose of evaluating whether there is an economic relationship between the hedged item(s) and the
hedging instrument(s), the Group assumes that the benchmark interest rate is not altered as a result of interest
rate benchmark reform.
For a cash flow hedge of a forecast transaction, the Group assumes that the benchmark interest rate will not be
altered as a result of interest rate benchmark reform for the purpose of assessing whether the forecast transaction
is highly probable and presents an exposure to variations in cash flows that could ultimately affect profit or loss.
A similar exception is also provided for a discontinued cash flow hedging relationship.
The Group will cease to apply the specific policy for assessing the economic relationship between the hedged
item and the hedging instrument (i) to a hedged item or hedging instrument when the uncertainty arising from
interest rate benchmark reform is no longer present with respect to the timing and the amount of the interest
rate benchmark-based cash flows of the respective item or instrument or (ii) when the hedging relationship is
discontinued. For its highly probable assessment of the hedged item, the Group will no longer apply the specific
policy when the uncertainty arising from interest rate benchmark reform about the timing and the amount of the
interest rate benchmark-based future cash flows of the hedged item is no longer present, or when the hedging
relationship is discontinued.
NOTES TO THEFINANCIAL STATEMENTS30 SEPTEMBER 2020 A N N U A L R E P O R T 2 0 2 0 / 1 6 5
3.
SIGNIFICANT ACCOUNTING POLICIES (CONT’D)
3.4
Financial instruments (cont’d)
(vi)
Derivative financial instruments and hedge accounting (cont’d)
Cash flow hedges
The Group designates certain derivatives as hedging instruments to hedge the variability in cash flows associated
with highly probable forecast transactions arising from changes in interest rates.
When a derivative is designated as a cash flow hedging instrument, the effective portion of changes in the fair value
of the derivative is recognised in unitholders’ funds and accumulated in the hedging reserve. The effective portion of
changes in the fair value of the derivative that is recognised in unitholders’ funds is limited to the cumulative change
in fair value of the hedged item, determined on a present value basis, from inception of the hedge. Any ineffective
portion of changes in the fair value of the derivative is recognised immediately in the statements of total return.
If the hedge no longer meets the criteria for hedge accounting or the hedging instrument is sold, expires, is
terminated or is exercised, then hedge accounting is discontinued prospectively. When hedge accounting for
cash flow hedges is discontinued, the amount that has been accumulated in the hedging reserve and the cost of
hedging reserve remains in unitholders’ funds until it is reclassified to the statements of total return in the same
period or periods as the hedged expected future cash flows affect the statements of total return.
If the hedged future cash flows are no longer expected to occur, then the amounts that have been accumulated in
the hedging reserve and the cost of hedging reserve are immediately reclassified to the statements of total return.
3.5
Fixed assets
(i)
Recognition and measurement
Items of fixed assets are measured at cost less accumulated depreciation and accumulated impairment losses.
Cost includes expenditure that is directly attributable to the acquisition of the asset.
If significant parts of an item of fixed asset have different useful lives, they are accounted for as separate items
(major components) of fixed asset.
The gain or loss on disposal of an item of fixed asset is recognised in the statements of total return.
(ii)
Subsequent costs
The cost of replacing a component of an item of fixed asset is recognised in the carrying amount of the item if it is
probable that the future economic benefits embodied within the component will flow to the Group, and its cost
can be measured reliably. The carrying amount of the replaced component is derecognised. The costs of the day-
to-day servicing of fixed asset are recognised in the statements of total return as incurred.
Contents
NOTES TO THEFINANCIAL STATEMENTS30 SEPTEMBER 2020 1 6 6 / F R A S E R S C E N T R E P O I N T T R U S T
3.
SIGNIFICANT ACCOUNTING POLICIES (CONT’D)
3.5
Fixed assets (cont’d)
(iii) Depreciation
Depreciation is based on the cost of an asset less its residual value. Significant components of individual assets are
assessed and if a component has a useful life that is different from the remainder of that asset, that component is
depreciated separately.
Depreciation is recognised as an expense in the statements of total return on a straight-line basis over the
estimated useful lives of each component of an item of fixed asset, unless it is included in the carrying amount of
another asset.
Depreciation is recognised from the date that the fixed assets are installed and are ready for use. The estimated
useful lives for the current and comparative years are 2 years to 10 years.
Depreciation methods, useful lives and residual values are reviewed at the end of each reporting period and
adjusted if appropriate.
3.6
Foreign currency
(i)
Foreign currency transactions
Transactions in foreign currencies are measured and recorded on initial recognition in Singapore dollars, the
functional currency of the Trust and subsidiaries, at exchange rates at the dates of transaction. Monetary assets
and liabilities denominated in foreign currencies at the reporting date are translated at the exchange rate at
that date.
Non-monetary assets and liabilities denominated in foreign currencies that are measured at fair value are
translated to the functional currency at the exchange rate at the date that the fair value was determined. Non-
monetary items in a foreign currency that are measured in terms of historical cost are translated using the
exchange rate at the date of the transaction. Foreign currency differences arising on translation are generally
recognised in profit or loss. However, foreign currency differences arising from the translation of the following
items are recognised in OCI:
•
•
•
an equity investment designated as at FVOCI;
a financial liability designated as a hedge of the net investment in a foreign operation to the extent that the
hedge is effective; and
qualifying cash flow hedges to the extent that the hedges are effective.
NOTES TO THEFINANCIAL STATEMENTS30 SEPTEMBER 2020 A N N U A L R E P O R T 2 0 2 0 / 1 6 7
3.
SIGNIFICANT ACCOUNTING POLICIES (CONT’D)
3.6
Foreign currency (cont’d)
(ii)
Foreign operations
The assets and liabilities of foreign operations, including goodwill and fair value adjustments arising on acquisition,
are translated to Singapore dollars at exchange rates at the reporting date. The income and expenses of foreign
operations are translated to Singapore dollars at exchange rates at the dates of the transactions.
Foreign currency differences are recognised in OCI. However, if the foreign operation is a non-wholly-owned
subsidiary, then the relevant proportionate share of the translation difference is allocated to the NCI. When a
foreign operation is disposed of such that control, significant influence or joint control is lost, the cumulative
amount in the translation reserve related to that foreign operation is reclassified to profit or loss as part of the
gain or loss on disposal. When the Group disposes of only part of its interest in a subsidiary that includes a foreign
operation while retaining control, the relevant proportion of the cumulative amount is reattributed to NCI.
When the Group disposes of only part of its investment in an associate or joint venture that includes a foreign
operation while retaining significant influence or joint control, the relevant proportion of the cumulative amount
is reclassified to profit or loss.
When the settlement of a monetary item receivable from or payable to a foreign operation is neither planned nor
likely to occur in the foreseeable future, foreign exchange gains and losses arising from such a monetary item that
are considered to form part of a net investment in a foreign operation are recognised in OCI, and are presented in
the translation reserve in equity.
3.7
Leases
The Group has applied FRS 116 using the modified retrospective approach and therefore the comparative
information has not been restated and continues to be reported under FRS 17 and INT FRS 104. The details of
accounting policies under FRS 17 and INT FRS 104 are disclosed separately.
Policy applicable from 1 October 2019
At inception of a contract, the Group assesses whether a contract is, or contains, a lease. A contract is, or contains,
a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for
consideration. To assess whether a contract conveys the right to control the use of an identified asset, the Group
uses the definition of a lease in FRS 116.
This policy is applied to contracts entered into, on or after 1 October 2019.
As a lessor
At inception or on modification of a contract that contains a lease component, the Group allocates the consideration
in the contract to each lease component on the basis of their relative stand-alone prices.
When the Group acts as a lessor, it determines at lease inception whether each lease is a finance lease or an
operating lease.
To classify each lease, the Group makes an overall assessment of whether the lease transfers substantially all of
the risks and rewards incidental to ownership of the underlying asset. If this is the case, then the lease is a finance
lease; if not, then it is an operating lease. As part of this assessment, the Group considers certain indicators such as
whether the lease is for the major part of the economic life of the asset.
Contents
NOTES TO THEFINANCIAL STATEMENTS30 SEPTEMBER 2020 1 6 8 / F R A S E R S C E N T R E P O I N T T R U S T
3.
SIGNIFICANT ACCOUNTING POLICIES (CONT’D)
3.7
Leases (cont’d)
As a lessor (cont’d)
If an arrangement contains lease and non-lease components, then the Group applies FRS 115 to allocate the
consideration in the contract.
The Group recognises lease payments received from investment property under operating leases as income on a
straight-line basis over the lease term as part of ‘revenue’.
Generally, the accounting policies applicable to the Group as a lessor in the comparative period were not different
from FRS 116.
Leases - Policy applicable before 1 October 2019
For contracts entered into before 1 October 2019, the Group determined whether the arrangement was or
contained a lease based on the assessment of whether:
•
•
fulfilment of the arrangement was dependent on the use of a specific asset or assets; and
the arrangement had conveyed a right to use the asset. An arrangement conveyed the right to use the
asset if one of the following was met:
the purchaser had the ability or right to operate the asset while obtaining or controlling more than
an insignificant amount of the output;
the purchaser had the ability or right to control physical access to the asset while obtaining or
controlling more than an insignificant amount of the output; or
facts and circumstances indicated that it was remote that other parties would take more than an
insignificant amount of the output, and the price per unit was neither fixed per unit of output nor
equal to the current market price per unit of output.
–
–
–
As a lessor
When the Group acted as a lessor, it determined at lease inception whether each lease was a finance lease or an
operating lease.
To classify each lease, the Group made an overall assessment of whether the lease transferred substantially all
of the risks and rewards incidental to ownership of the underlying asset. If this was the case, then the lease was
a finance lease; if not, then it was an operating lease. As part of this assessment, the Group considered certain
indicators such as whether the lease was for the major part of the economic life of the asset.
Rental income from investment property is recognised as “revenue” on a straight-line basis over the term of the
lease. Rental income from sub-leased property is recognised as “other income”.
NOTES TO THEFINANCIAL STATEMENTS30 SEPTEMBER 2020 A N N U A L R E P O R T 2 0 2 0 / 1 6 9
3.
SIGNIFICANT ACCOUNTING POLICIES (CONT’D)
3.8
Impairment
(i)
Non-derivative financial assets
The Group recognises loss allowances for expected credit losses (ECLs) on financial assets measured at amortised
cost and lease receivables.
Loss allowances of the Group are measured on either of the following bases:
•
•
12-month ECLs: these are ECLs that result from default events that are possible within the 12 months after
the reporting date (or for a shorter period if the expected life of the instrument is less than 12 months); or
Lifetime ECLs: these are ECLs that result from all possible default events over the expected life of a
financial instrument.
Simplified approach
The Group applies the simplified approach to provide for ECLs for all trade receivables (including lease receivables).
The simplified approach requires the loss allowance to be measured at an amount equal to lifetime ECLs.
General approach
The Group applies the general approach to provide for ECLs on all other financial instruments. Under the general
approach, the loss allowance is measured at an amount equal to 12-month ECLs at initial recognition.
At each reporting date, the Group assesses whether the credit risk of a financial instrument has increased
significantly since initial recognition. When credit risk has increased significantly since initial recognition, loss
allowance is measured at an amount equal to lifetime ECLs.
When determining whether the credit risk of a financial asset has increased significantly since initial recognition and
when estimating ECLs, the Group considers reasonable and supportable information that is relevant and available
without undue cost or effort. This includes both quantitative and qualitative information and analysis, based on
the Group’s historical experience and informed credit assessment and includes forward-looking information.
If credit risk has not increased significantly since initial recognition or if the credit quality of the financial
instruments improves such that there is no longer a significant increase in credit risk since initial recognition, loss
allowance is measured at an amount equal to 12-month ECLs.
The Group considers a financial asset to be in default when the debtor is unlikely to pay its credit obligations to
the Group in full, without recourse by the Group to actions such as realising security (if any is held), or when the
financial asset is more than 90 days past due.
The maximum period considered when estimating ECLs is the maximum contractual period over which the Group
is exposed to credit risk.
Measurement of ECLs
ECLs are probability-weighted estimates of credit losses. Credit losses are measured at the present value of
all cash shortfalls (i.e. the difference between the cash flows due to the entity in accordance with the contract
and the cash flows that the Group expects to receive). ECLs are discounted at the effective interest rate of the
financial asset.
Contents
NOTES TO THEFINANCIAL STATEMENTS30 SEPTEMBER 2020 1 7 0 / F R A S E R S C E N T R E P O I N T T R U S T
3.
SIGNIFICANT ACCOUNTING POLICIES (CONT’D)
3.8
Impairment (cont’d)
(i)
Non-derivative financial assets (cont’d)
Credit-impaired financial assets
At each reporting date, the Group assesses whether financial assets carried at amortised cost are credit-impaired.
A financial asset is ‘credit-impaired’ when one or more events that have a detrimental impact on the estimated
future cash flows of the financial asset have occurred.
Evidence that a financial asset is credit-impaired includes the following observable data:
•
•
•
•
•
significant financial difficulty of the debtor;
a breach of contract such as a default or being more than 90 days past due;
the restructuring of a loan or advance by the Group on terms that the Group would not consider otherwise;
it is probable that the debtor will enter bankruptcy or other financial reorganisation; or
the disappearance of an active market for a security because of financial difficulties.
Presentation of allowance for ECLs in the balance sheets
Loss allowances for financial assets measured at amortised cost are deducted from the gross carrying amount of
these assets.
Write-off
The gross carrying amount of a financial asset is written off (either partially or in full) to the extent that there is
no realistic prospect of recovery. This is generally the case when the Group determines that the debtor does not
have assets or sources of income that could generate sufficient cash flows to repay the amounts subject to the
write-off. However, financial assets that are written off could still be subject to enforcement activities in order to
comply with the Group’s procedures for recovery of amounts due.
(ii)
Non-financial assets
The carrying amounts of the Group’s non-financial assets, other than investment properties, are reviewed at
each reporting date to determine whether there is any indication of impairment. If any such indication exists,
then the assets’ recoverable amounts are estimated. An impairment loss is recognised if the carrying amount
of an asset or its CGU exceeds its estimated recoverable amount. Impairment losses are recognised in the
statements of total return.
The recoverable amount of an asset or cash-generating unit (“CGU”) is the greater of its value in use and its fair
value less costs to sell. In assessing value in use, the estimated future cash flows are discounted to their present
value using a pre-tax discount rate that reflects current market assessments of the time value of money and the
risks specific to the asset or CGU. For the purpose of impairment testing, assets that cannot be tested individually
are grouped together into the smallest group of assets that generates cash inflows from continuing use that are
largely independent of the cash inflows of other assets or CGU.
NOTES TO THEFINANCIAL STATEMENTS30 SEPTEMBER 2020 A N N U A L R E P O R T 2 0 2 0 / 1 7 1
3.
SIGNIFICANT ACCOUNTING POLICIES (CONT’D)
3.8
Impairment (cont’d)
(ii)
Non-financial assets (cont’d)
Impairment losses recognised in prior periods are assessed at each reporting date for any indications that the
loss has decreased or no longer exists. An impairment loss is reversed if there has been a change in the estimates
used to determine the recoverable amount. An impairment loss is reversed only to the extent that the asset’s
carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or
amortisation, if no impairment loss had been recognised.
An impairment loss in respect of an associate or joint venture is measured by comparing the recoverable amount
of the investment with its carrying amount in accordance with the requirements for non-financial assets. An
impairment loss is recognised in the statements of total return. An impairment loss is reversed if there has been
a favourable change in the estimates used to determine the recoverable amount and only to the extent that the
recoverable amount increases.
Goodwill that forms part of the carrying amount of an investment in an associate is not recognised separately, and
therefore is not tested for impairment separately. Instead, the entire amount of the investment in an associate is
tested for impairment as a single asset when there is objective evidence that the investment in an associate may
be impaired
3.9
Assets held for sale
The fair value of the Group’s investment properties held for sale is either valued by an independent valuer or based
on agreed contractual selling price on a willing buyer seller basis. For investment properties held for sale valued
by an independent valuer, the valuer has considered the direct comparison and residual method in arriving at the
open market value as at the reporting date. In determining the fair value, the valuer used valuation techniques
which involve certain estimates.
3.10
Intangible assets
Software is initially recognised at cost and subsequently carried at cost less accumulated amortisation.
Amortisation is recognised in the statements of total return on a straight-line basis over its estimated useful life
of 5 years.
Amortisation methods, useful lives and residual values are reviewed at the end of each reporting period and
adjusted if appropriate.
3.12 Finance income and finance costs
The Group’s finance income and finance costs include:
•
•
•
•
•
•
interest income;
interest expense;
dividend income;
the foreign currency gain or loss on financial assets and financial liabilities;
the gain on the remeasurement to fair value of any pre-existing interest in an acquiree in a business
combination; and
hedge ineffectiveness recognised in profit or loss.
Contents
NOTES TO THEFINANCIAL STATEMENTS30 SEPTEMBER 2020 1 7 2 / F R A S E R S C E N T R E P O I N T T R U S T
Interest income or expense is recognised using the effective interest method. Dividend income is recognised in
profit or loss on the date on which the Group’s right to receive payment is established.
The ‘effective interest rate’ is the rate that exactly discounts estimated future cash payments or receipts through
the expected life of the financial instrument to:
•
•
the gross carrying amount of the financial asset; or
the amortised cost of the financial liability.
In calculating interest income and expense, the effective interest rate is applied to the gross carrying amount of the
asset (when the asset is not credit-impaired) or to the amortised cost of the liability. However, for financial assets
that have become credit-impaired subsequent to initial recognition, interest income is calculated by applying the
effective interest rate to the amortised cost of the financial asset. If the asset is no longer credit-impaired, then the
calculation of interest income reverts to the gross basis.
Borrowing costs that are not directly attributable to the acquisition, construction or production of a qualifying
asset are recognised in profit or loss using the effective interest method.
3.13
Investment properties
Investment properties are properties held either to earn rental income or for capital appreciation or for both, but
not for sale in the ordinary course of business, use in production or supply of goods or services or for administrative
purposes. Investment properties are measured at cost on initial recognition and subsequently at fair value
thereafter. Valuation is determined in accordance with the Trust Deed, which requires the investment properties
to be valued by independent registered valuers.
•
•
In such manner and frequency required under the CIS Code issued by the MAS; and
At least in each period of 12 months following the acquisition of each parcel of real estate property.
Any increase or decrease on revaluation is credited or charged to the statements of total return as a net revaluation
surplus or deficit in the value of the investment properties.
Cost includes expenditure that is directly attributable to the acquisition of the investment property. Any gain or
loss on disposal of an investment property (calculated as the difference between the net proceeds from disposal
and the carrying amount of the item) is recognised in the statements of total return.
Investment properties are not depreciated. Investment properties are subject to continual maintenance and
regularly revalued on the basis set out above. For taxation purposes, the Group and the Trust may claim capital
allowances on assets that qualify as plant and machinery under the Singapore Income Tax Act.
NOTES TO THEFINANCIAL STATEMENTS30 SEPTEMBER 2020 A N N U A L R E P O R T 2 0 2 0 / 1 7 3
3.
SIGNIFICANT ACCOUNTING POLICIES (CONT’D)
3.14 Provisions
A provision is recognised if, as a result of a past event, the Group has a present legal or constructive obligation that
can be estimated reliably, and it is probable that an outflow of economic benefits will be required to settle the
obligation. Provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflects
current market assessments of the time value of money and the risks specific to the liability. The unwinding of the
discount is recognised as finance cost.
3.15 Revenue recognition
Gross rental income
Gross rental income is recognised on a straight line basis over the lease term commencing on the date from which
the lessee is entitled to exercise its right to use the leased asset.
Turnover rental income
Contingent rentals, which include gross turnover rental, are recognised as income in the accounting period in
which it is earned and the amount can be reliably measured.
Car park income
Car park income consists of season and hourly parking income. Season parking income is recognised on a straight-
line basis over the non-cancellable lease term. Hourly parking income is recognised at a point of time upon the
utilisation of car parking facilities.
3.16 Security deposits and deferred income
Security deposits relate to rental deposits received from tenants at the Group’s investment properties. The
accounting policy for security deposits as financial liabilities is set out in Note 3.4.
Deferred income relates to the difference between consideration received for security deposits and its fair value
at initial recognition and is credited to the statements of total return as gross rental income on a straight line basis
over individual lease term.
3.17 Segment reporting
An operating segment is a component of the Group that engages in business activities from which it may earn
revenues and incur expenses, including revenues and expenses that relate to transactions with any of the Group’s
other components. All operating segments’ operating results are reviewed regularly by the Board of Directors of
the Manager to make decisions about resources to be allocated to the segment and to assess its performance, and
for which discrete financial information is available.
Segment results that are reported to the Board of Directors of the Manager include items directly attributable
to a segment as well as those that can be allocated on a reasonable basis. Unallocated items comprise mainly
borrowing costs and asset management fees.
Segment capital expenditure is the total cost incurred to acquire investment properties and fixed assets.
Contents
NOTES TO THEFINANCIAL STATEMENTS30 SEPTEMBER 2020 1 7 4 / F R A S E R S C E N T R E P O I N T T R U S T
3.
SIGNIFICANT ACCOUNTING POLICIES (CONT’D)
3.18 Taxation
Tax expense comprises current and deferred tax. Current tax and deferred tax expense is recognised in the
statements of total return except to the extent that it relates to a items recognised directly in unitholders’ funds.
The Group has determined that interest and penalties related to income taxes, including uncertain tax treatments,
do not meet the definition of income taxes, and therefore accounted for them under FRS 37 Provisions, Contingent
Liabilities and Contingent Assets.
Current tax is the expected tax payable or receivable on the taxable income or loss for the year, using tax rates
enacted or substantively enacted at the reporting date, and any adjustment to tax payable in respect of previous
years. The amount of current tax payable or receivable is the best estimate of the tax amount expected to be paid
or received that reflects uncertainty related to income taxes, if any.
Current tax assets and liabilities are offset only if certain criteria are met.
Deferred tax is not recognised for temporary differences that:
•
•
temporary differences on the initial recognition of assets or liabilities in a transaction that is not a business
combination and that affects neither accounting nor taxable profit or loss;
temporary differences related to investments in subsidiaries, associates and joint arrangements to the
extent that the Group is able to control the timing of the reversal of the temporary difference and it is
probable that they will not reverse in the foreseeable future; and
•
taxable temporary differences arising on the initial recognition of goodwill.
The measurement of deferred taxes reflects the tax consequences that would follow the manner in which the
Group expects, at the reporting date, to recover or settle the carrying amount of its assets and liabilities. For
investment property that is measured at fair value, the carrying amount of the investment property is presumed
to be recovered through sale, and the Group has not rebutted this presumption. Deferred tax is measured at the
tax rates that are expected to be applied to temporary differences when they reverse, based on the laws that
have been enacted or substantively enacted by the reporting date, and reflects uncertainty related to income
taxes, if any.
Deferred tax assets and liabilities are offset if there is a legally enforceable right to offset current tax liabilities and
assets, and they relate to taxes levied by the same tax authority on the same taxable entity, or on different tax
entities, but they intend to settle current tax liabilities and assets on a net basis or their tax assets and liabilities
will be realised simultaneously.
Deferred tax assets are recognised for unused tax losses, unused tax credits and deductible temporary differences
to the extent that it is probable that future taxable profits will be available against which they can be used. Future
taxable profits are determined based on the reversal of relevant taxable temporary differences. If the amount of
taxable temporary differences is insufficient to recognise a deferred tax asset in full, then future taxable profits,
adjusted for reversals of existing temporary differences, are considered, based on the business plans for individual
subsidiaries in the Group. Deferred tax assets are reviewed at each reporting date and are reduced to the extent
that it is no longer probable that the related tax benefit will be realised; such reductions are reversed when the
probability of future taxable profits improves.
Unrecognised deferred tax assets are reassessed at each reporting date and recognised to the extent that it has
become probable that future taxable profits will be available against which they can be used.
NOTES TO THEFINANCIAL STATEMENTS30 SEPTEMBER 2020 A N N U A L R E P O R T 2 0 2 0 / 1 7 5
3.
SIGNIFICANT ACCOUNTING POLICIES (CONT’D)
3.18 Taxation (cont’d)
Tax transparency
The Inland Revenue Authority of Singapore (“IRAS”) has issued a tax ruling on the income tax treatment of the
Trust. Subject to meeting the terms and conditions of the tax ruling which includes a distribution of at least 90% of
the taxable income of the Trust, the Trustee will not be assessed to tax on the taxable income of the Trust. Instead,
the distributions made by the Trust out of such taxable income are subject to tax in the hands of Unitholders,
unless they are exempt from tax on the Trust’s distributions (the “tax transparency ruling”). Accordingly, the
Trustee and the Manager will deduct income tax at the prevailing corporate tax rate from the distributions made
to Unitholders that are made out of the taxable income of the Trust, except:
–
–
where the beneficial owners are individuals or Qualifying Unitholders, who are not acting in the capacity of
a trustee, the Trustee and the Manager will make the distributions to such Unitholders without deducting
any income tax; and
where the beneficial owners are Qualifying foreign non-individual investors or foreign funds or where the
Units are held by nominee Unitholders who can demonstrate that the Units are held for beneficial owners
who are Qualifying foreign non-individual investors or foreign funds, the Trustee and the Manager will
deduct/withhold tax at a reduced rate of 10% from the distributions.
A Qualifying non-individual investor refers to a non-resident non-individual unitholder or foreign fund who:
does not have any permanent establishment in Singapore (other than a fund manager in Singapore); or
(i)
carries on any operation through a permanent establishment in Singapore (other than a fund manager in
Singapore), where the funds used by that person to acquire the units in the Trust are not obtained from
that operation.
A Qualifying Unitholder is a unitholder who is:
(i)
an individual (including those who purchased units in the Trust through agent banks or Supplementary
Retirement Scheme (“SRS”) operators which act as a nominee under the CPF Investment Scheme or the
SRS respectively);
(ii)
a company incorporated and resident in Singapore;
(iii)
a Singapore branch of a foreign company;
(iv)
(v)
(vi)
a body of persons (excluding companies or partnerships) incorporated or registered in Singapore, including
charities registered under Charities Act (Cap. 37) or established by any written law, town councils, statutory
boards, co-operative societies registered under the Co-operatives Societies Act (Cap. 62) or trade unions
registered under the Trade Unions Act (Cap. 333);
an international organisation that is exempt from tax on such distributions by reason of an order made
under the International Organisations (Immunities and Privileges) Act (Cap. 145); or
real estate investment trust exchange-traded funds (“REIT ETFs”) which have been accorded the tax
transparency treatment.
Contents
NOTES TO THEFINANCIAL STATEMENTS30 SEPTEMBER 2020 1 7 6 / F R A S E R S C E N T R E P O I N T T R U S T
3.
SIGNIFICANT ACCOUNTING POLICIES (CONT’D)
3.18 Taxation (cont’d)
Tax transparency (cont’d)
A qualifying Non-resident Fund is a non-resident fund that qualifies for tax exemption under Section 13CA, 13X or
13Y of the Income Tax Act (Cap.134) and who:
(i)
does not have a permanent establishment in Singapore (other than a fund manager in Singapore); or
(ii)
carries on an operation through a permanent establishment in Singapore (other than a fund manager in
Singapore), where the funds used by that qualifying fund to acquire units of the Trust are not obtained from
that operation.
The above tax transparency ruling does not apply to gains from the sale of real properties. Such gains, when
determined by the IRAS to be trading gains, are assessable to tax on the Trustee. Where the gains are capital gains,
the Trustee will not be assessed to tax and may distribute the capital gains without tax being deducted at source.
(iv)
Sales tax
Revenue, expenses and assets are recognised net of the amount of sales tax except:
–
where the sales tax incurred on a purchase of assets or services is not recoverable from the taxation
authority, in which case the sales tax is recognised as part of the cost of acquisition of the asset or as part
of the expense item as applicable; and
–
receivables and payables that are stated with the amount of sales tax included.
The net amount of sales tax recoverable from, or payable to, the IRAS is included as part of receivables or payables
on the Balance Sheets.
3.19 Unitholders’ funds
Unitholders’ funds represent the Unitholders’ residual interest in the Group’s net assets upon termination and
are classified as equity. Incremental costs directly attributable to the issuance of Units are deducted against
Unitholders’ funds.
3.20 Government grants
Government grants are recognised when there is reasonable assurance that the grant will be received and the
Group will comply with the conditions associated with the grant. Government grants related to income are
recognised in profit or loss as ‘Other Income’ on a systematic basis over the periods in which the entity recognises
as expenses the related costs for which the grants are intended to compensate.
NOTES TO THEFINANCIAL STATEMENTS30 SEPTEMBER 2020 A N N U A L R E P O R T 2 0 2 0 / 1 7 7
3.
SIGNIFICANT ACCOUNTING POLICIES (CONT’D)
3.21 New standards and interpretations not adopted
A number of new standards, interpretations and amendments to standards are effective for annual periods
beginning after 1 October 2019 and earlier application is permitted; however, the Group has not early adopted
the new or amended standards and interpretations in preparing these financial statements.
The following new FRSs, interpretations and amendments to FRSs are not expected to have a significant impact
on the Group’s consolidated financial statements and the Company’s statement of financial position.
•
•
•
•
Amendments to References to Conceptual Framework in FRS Standards
Definition of a Business (Amendments to FRS 103)
Definition of Material (Amendments to FRS 1 and FRS 8)
FRS 117 Insurance Contracts
4.
INVESTMENT PROPERTIES
At beginning
Capital expenditure
Surplus on revaluation taken to Statements of Total Return
Reclassification to asset held for sale (Note 11)
At end
Group and Trust
2020
$’000
2019
$’000
2,846,000
8,189
2,854,189
3,311
(108,000)
2,749,500
2,749,000
5,013
2,754,013
91,987
–
2,846,000
The investment properties owned by the Group and the Trust are set out in the Portfolio Statements on pages 149
to 151.
Anchorpoint has been mortgaged as security for a $80 million secured five-year term loan from DBS Bank Ltd
(Note 15(a)(ii)). The loan has been prepaid on 7 October 2020 and discharge of its mortgage is in progress.
Changi City Point has been mortgaged as security for a $190 million secured three- and five-year term loan from
BNP Paribas (Note 15(a)(iv)).
Contents
NOTES TO THEFINANCIAL STATEMENTS30 SEPTEMBER 2020 1 7 8 / F R A S E R S C E N T R E P O I N T T R U S T
4.
INVESTMENT PROPERTIES (CONT’D)
Valuation processes
Investment properties are stated at fair value based on valuations performed by external independent valuers
who possess appropriate recognised professional qualifications and relevant experience in the location and
property being valued. In accordance with the CIS code, the Group rotates the independent valuers every two
years and has appointed valuers to value the same property for a third consecutive financial year for the current
financial year ended 30 September 2020.
In determining the fair value, the valuers have used valuation methods which involve certain estimates. The key
assumptions used to determine the fair value of investment properties include market-corroborated capitalisation
yields, discount rates and terminal yields. The independent valuers have considered available information as at
15 September 2020 relating to COVID-19 and have made necessary adjustments to the valuation. The valuation
reports also highlighted that given the unprecedented set of circumstances on which to base a judgement, less
certainty, and a higher degree of caution, should be attached to their valuations than would normally be the case.
Due to the unknown future impact that COVID-19 might have on the real estate market, the external valuers have
also recommended to keep the valuation of these properties under frequent review. The Manager reviews the
appropriateness of the valuation methodologies, assumptions and estimates adopted and is of the view that they
are reflective of the market conditions as at 15 September 2020.
Fair value hierarchy
•
•
•
Level 1:
quoted prices (unadjusted) in active markets for identical assets or liabilities that the Group
can access at the measurement date;
Level 2:
inputs other than quoted prices included within Level 1 that are observable for the asset or
liability, either directly (i.e., as prices) or indirectly (i.e., derived from prices); and
Level 3:
inputs for the asset or liability that are not based on observable market data
(unobservable inputs).
As a result of the COVID-19 pandemic, assessing fair value as at the reporting date involved considering
uncertainties around the underlying assumptions and inputs to fair value given the forward-looking nature of
these assumptions. The COVID-19 pandemic has also created unprecedented economic uncertainty, in particular
the absence of a significant level of market transactions which are ordinarily a key source of evidence for assessing
the fair value of investment properties.
As such, the 15 September 2020 valuation process has been adjusted for the current period compared to the
process that would typically be followed and adopted in more normalised market conditions.
Fair value measurements that use inputs of different hierarchy levels are categorised in its entirety in the same
level of the fair value hierarchy as the lowest level input that is significant to the entire measurement.
At 30 September 2020
Non-financial assets
Investment properties
At 30 September 2019
Non-financial assets
Investment properties
Level 1
$’000
Level 2
$’000
Level 3
$’000
Total
$’000
–
–
–
2,749,500
2,749,500
–
2,846,000
2,846,000
NOTES TO THEFINANCIAL STATEMENTS30 SEPTEMBER 2020 A N N U A L R E P O R T 2 0 2 0 / 1 7 9
4.
INVESTMENT PROPERTIES (CONT’D)
Level 3 fair value measurements
The following table shows the information about fair value measurements using significant unobservable
inputs (Level 3):
Fair value at
30 September
2020
$’000
Description
Valuation
techniques
Key
unobservable
inputs
Range of
unobservable inputs
Investment
properties
2,749,500
(2019:2,846,000)
Capitalisation
approach
Capitalisation
rate
3.75% – 5.00%
(2019: 3.75% – 5.00%)
Discounted
cash flow
analysis
Discount rate
7.00% – 7.50%
(2019: 7.00% – 7.50%)
Terminal yield
4.00% – 5.25%
(2019: 4.00% – 5.25%)
Direct
comparison
method
Transacted
prices
$1,805 – $4,205 psf
(2019: $1,209 – $4,379 psf) (1)
Relationship of
unobservable
inputs to
fair value
The higher the
rates, the lower
the fair value.
The higher the
rates, the lower
the fair value.
The higher the
rates, the lower
the fair value.
The higher the
comparable
values, the
higher the
fair value.
(1) For Causeway Point, YewTee Point, Changi City Point and Yishun 10 (2019: Causeway Point, YewTee Point, Bedok Point, Changi City Point and
Yishun 10)
A significant reduction in the capitalisation rate and/or discount rate in isolation would result in a significantly
higher fair value of the investment properties.
The key unobservable inputs correspond to:
•
•
•
discount rate, based on the risk-free rate for 10-year bonds issued by the government of Singapore,
adjusted for a risk premium to reflect the increased risk of investing in the asset class;
terminal yield reflects the uncertainty, functional/economic obsolescence and the risk associated with the
investment properties; and
capitalisation rate which corresponds to a rate of return on investment properties based on the expected
income that the property will generate.
Contents
NOTES TO THEFINANCIAL STATEMENTS30 SEPTEMBER 2020 1 8 0 / F R A S E R S C E N T R E P O I N T T R U S T
4.
INVESTMENT PROPERTIES (CONT’D)
Level 3 fair value measurements (cont’d)
The net change in fair value of the properties recognised in the Statements of Total Return has been adjusted for
amortisation of lease incentives as follows:
Surplus on revaluation
Amortisation of lease incentives
Surplus on revaluation recognised in Statements of Total Return
Group and Trust
2020
$’000
3,311
1,436
4,747
2019
$’000
91,987
1,303
93,290
Direct operating expenses (including repairs and maintenance) arising from rental generating properties are
disclosed on Note 21 to the financial statements.
The Group has no restrictions on the realisability of its investment properties and no contractual obligations to
purchase, construct or develop investment property or for repairs, maintenance or enhancements.
5.
FIXED ASSETS
Cost
At beginning
Additions
Disposals/write-offs
At end
Accumulated depreciation
At beginning
Charge for the year
Disposals/write-offs
At end
Carrying amount
At beginning
At end
Equipment,
furniture and fittings,
and others
Group and Trust
2020
$’000
2019
$’000
401
206
(141)
466
316
56
(135)
237
85
229
421
29
(49)
401
272
93
(49)
316
149
85
NOTES TO THEFINANCIAL STATEMENTS30 SEPTEMBER 2020 A N N U A L R E P O R T 2 0 2 0 / 1 8 1
6.
INVESTMENT IN SUBSIDIARIES
Unquoted equity investments, at cost
Details of the subsidiaries are as follows:
Name of subsidiary
Place of incorporation/business
FCT MTN Pte. Ltd. (1)
FCT Holdings (Sigma) Pte. Ltd. (1)
(1) Audited by KPMG LLP, Singapore
Singapore
Singapore
Trust
2020
$’000
2019
$’000
190,200
1
Effective equity
interest held by
the Trust
2020
%
100
100
2019
%
100
100
FCT MTN Pte. Ltd. (“FCT MTN”) is a wholly-owned subsidiary with share capital of $2 comprising 2 ordinary shares.
The principal activity of the subsidiary is the provision of treasury services, including lending to the Trust the
proceeds from issuance of notes under an unsecured multicurrency medium term note programme.
FCT Holdings (Sigma) Pte. Ltd. (“FCT Sigma”) is a wholly-owned subsidiary with share capital of $190,200,000
(2019: $1,000) comprising 190,200,000 (2019: 1,000) ordinary shares. The principal activity of the subsidiary is
investment holding.
7.
INVESTMENT IN ASSOCIATES
Investments, at cost
Share of post-acquisition reserves
Translation difference
Allowance for impairment
Details of the associates are as follows:
Group
2020
$’000
2019
$’000
651,774
70,390
(18,999)
703,165
(6,759)
696,406
454,537
28,521
(18,829)
464,229
(6,759)
457,470
2020
$’000
74,584
–
–
74,584
(11,800)
62,784
Trust
2019
$’000
74,584
–
–
74,584
(9,976)
64,608
Place of
incorporation/
business
Malaysia
Bermuda/
Singapore
Effective equity
interest held by
the Group
2020
%
2019
%
Effective equity
interest held by
the Trust
2020
%
2019
%
31.15
31.15
31.15
31.15
36.89
21.13 (4)
–
–
Name of associates
Hektar Real Estate
Investment Trust (1)
AsiaRetail Fund Limited
(“ARF”) (2) (3)
(1) Audited by BDO, Malaysia
(2) Audited by KPMG LLP, Singapore
(3) ARF is formerly known as “PGIM Real Estate AsiaRetail Fund Limited”.
(4) Following the investors’ share redemption in the capital of ARF on 30 September 2019, the Group’s equity interest was 24.82%.
Contents
NOTES TO THEFINANCIAL STATEMENTS30 SEPTEMBER 2020 1 8 2 / F R A S E R S C E N T R E P O I N T T R U S T
7.
INVESTMENT IN ASSOCIATES (CONT’D)
(a)
Hektar Real Estate Investment Trust (“H-REIT”) is a real estate investment trust constituted in Malaysia by
a trust deed dated 5 October 2006. H-REIT units are listed on the Main Board of Bursa Malaysia Securities
Berhad. The principal investment objective of H-REIT is to invest in income-producing real estate in Malaysia
used primarily for retail purposes.
The Group assesses at each reporting date whether there is any objective evidence that investment
in associates is impaired. Where there is objective evidence of impairment, the recoverable amount is
estimated based on the revalued net book value of the associates. As at 30 September 2020, the Trust
provided for an impairment loss of $1,824,000 to write down the carrying amount of the investment in
associates to the share of the revalued net book value of the associates.
As the results of H-REIT are not expected to be announced in sufficient time to be included in the Group’s
results for the quarter ended 30 September 2020, the Group has estimated the results of H-REIT for the
quarter ended 30 September 2020 based on its results for the preceding quarter, adjusted for significant
transactions and events occurring up to the reporting date of the Group, if any.
The results for H-REIT are equity accounted for at the Group level, net of 10% (2019: 10%) withholding tax
in Malaysia.
The fair value of H-REIT based on published price quotations was $27,695,000 (2019: $46,774,000).
The following summarised financial information relating to the associate has not been adjusted for the
percentage of ownership interest held by the Group:
Assets and liabilities (5)
Non-current assets
Current assets
Total assets
Current liabilities
Non-current liabilities
Total liabilities
Results (6)
Revenue
Expenses
Revaluation surplus/(deficit)
Total return for the year
2020
$’000
2019
$’000
405,411
17,008
422,419
26,539
197,422
223,961
403,744
11,422
415,166
23,717
184,167
207,884
40,666
(32,095)
1,219
9,790
44,742
(31,746)
(3,076)
9,920
(5) The “Assets and liabilities” is based on the latest available unaudited management accounts as at 30 June 2020 and 30 June 2019,
respectively.
(6) The “Results” is for six months ended 30 June 2020 and 30 June 2019 respectively and pro-rated six month results from the audited
financial statements for the period ended 31 December 2019 and 31 December 2018, respectively.
As at 30 September 2020, the associate’s property portfolio comprises Subang Parade in Selangor, Mahkota
Parade in Melaka, Wetex Parade and Segamat Central in Johor, Central Square and Kulim Central in Kedah.
NOTES TO THEFINANCIAL STATEMENTS30 SEPTEMBER 2020 A N N U A L R E P O R T 2 0 2 0 / 1 8 3
7.
INVESTMENT IN ASSOCIATES (CONT’D)
(b)
AsiaRetail Fund Limited (“ARF”) is an open-end private investment vehicle set up as a company incorporated
in Bermuda and the largest non-listed retail mall fund in Singapore.
On 6 July 2020, the Group’s equity interest in ARF increased from 24.82% to 36.89%, through an acquisition
by its wholly-owned subsidiary, FCT Holdings (Sigma) Pte. Ltd., which purchased 48,229 shares in the
capital of ARF for a total consideration of approximately S$197.2 million.
No disclosure of fair value is made for the associate as it is not quoted on any market.
The following summarised financial information relating to the associate has not been adjusted for the
percentage of ownership interest held by the Group:
Assets and liabilities (1)
Non-current assets
Current assets
Total assets
Current liabilities
Non-current liabilities
Total liabilities
Results (2)
Revenue
Expenses
Revaluation surplus
Other comprehensive income
Total return for the period
2020
$’000
2019
$’000
3,169,878
122,598
3,292,476
146,133
1,450,635
1,596,768
3,014,711
251,991
3,266,702
768,962
920,476
1,689,438
196,534
(124,960)
156,204
(1,192)
226,586
118,380
(80,864)
92,915
(1,396)
129,035
(1) The “Assets and liabilities” is based on the latest available unaudited management accounts as at 30 September 2020 and 30 September
2019, respectively.
(2) The “Results” is for twelve months ended 30 September 2020 and six months ended 30 September 2019 respectively.
As at 30 September 2020, the associate’s property portfolio comprises Tiong Bahru Plaza, White Sands,
Hougang Mall, Century Square and Tampines 1 and an office property (Central Plaza) in Singapore and
Setapak Central Mall in Kuala Lumpur.
Group’s interest in associates at beginning of the year
457,470
66,060
2020
$’000
2019
$’000
Group’s share of:
– Profit after taxation
– Other comprehensive income
Total comprehensive income
Additions during the year
Dividends received during the year
Translation difference
Carrying amount of interest at end of the year
75,280
(240)
75,040
197,237
(33,171)
(170)
696,406
22,548
(325)
22,223
379,953
(10,753)
(13)
457,470
Contents
NOTES TO THEFINANCIAL STATEMENTS30 SEPTEMBER 2020 1 8 4 / F R A S E R S C E N T R E P O I N T T R U S T
8.
INVESTMENT IN JOINT VENTURES
Unquoted equity investments, at cost
Share of post-acquisition reserves
Allowance for impairment
Loan to joint venture
Details of the joint ventures are as follows:
Name of joint ventures
Changi City Carpark Operations LLP
Sapphire Star Trust
FC Retail Trustee Pte. Ltd.
Group
2020
$’000
2019
$’000
Trust
2020
$’000
2019
$’000
174,758
3,571
178,329
(1,132)
113,810
291,007
174,690
3,715
178,405
(1,132)
113,810
291,083
174,758
–
174,758
(1,132)
113,810
287,436
174,690
–
174,690
(1,132)
113,810
287,368
Place of
incorporation/
business
Singapore
Singapore
Singapore
Effective equity
interest held by the
Group and Trust
2020
%
43.68
40.00
40.00
2019
%
43.68
40.00
40.00
The Group has 43.68% interest in the ownership and voting rights in a joint venture, Changi City Carpark Operations
LLP. This joint venture is incorporated in Singapore and is a strategic venture in the management and operation of
car park in Changi City Point.
The Group has 40.00% interest in the ownership and voting rights in a joint venture, Sapphire Star Trust (“SST”), a
private trust that owns Waterway Point, a suburban shopping mall located in Punggol. The Group jointly controls
the venture with other partners under the contractual agreement and requires unanimous consent for all major
decisions over the relevant activities.
Loan to joint venture is unsecured and not expected to be repaid within the next twelve months. The loan bears
effective interest rates of between 1.053% to 2.529% (2019: 2.708% per annum).
No disclosure is of fair value is made for the joint ventures as they are not quoted on any market.
NOTES TO THEFINANCIAL STATEMENTS30 SEPTEMBER 2020 A N N U A L R E P O R T 2 0 2 0 / 1 8 5
8.
INVESTMENT IN JOINT VENTURES (CONT’D)
The following summarised financial information relating to the material joint venture has not been adjusted for
the percentage of ownership interest held by the Group.
Assets and liabilities (1)
Non-current assets
Current assets (a)
Total assets
Current liabilities (b)
Non-current liabilities
Total liabilities
2020
$’000
2019
$’000
1,300,031
45,900
1,345,931
1,300,010
42,891
1,342,901
608,625
302,959
911,584
39,594
869,157
908,751
(a)
Includes cash and cash equivalents of $41,600,000 ($2019: $40,914,000)
(b)
Includes current bank borrowings and derivative financial instruments of $577,733,000 (2019: $575,477,000)
Results (2)
Revenue
Expenses (c)
Revaluation surplus
Total return for the period
(c)
Includes:
–
–
–
depreciation of $10,000 (2019: $2,000)
interest income $202,000 (2019: $82,000)
interest expense $20,620,000 (2019: $5,200,000)
63,930
(39,317)
737
25,350
16,444
(8,840)
221
7,825
(1) The “Assets and liabilities” is based on the latest available unaudited management accounts as at 30 September 2020 and 30 September 2019,
respectively.
(2) The “Results” is for twelve months ended 30 September 2020 and 12 July 2019 to 30 September 2019, respectively.
Group’s interest in joint ventures at beginning of the year
291,083
227
2020
$’000
2019
$’000
Group’s share of:
– Profit after taxation
Other comprehensive income
Total comprehensive income
Investment during the year
Loan to joint venture
Dividends received during the year
Allowance for impairment
Carrying amount of interest at end of the year
11,200
(765)
10,435
68
–
(10,579)
–
291,007
6,409
–
6,409
174,689
113,810
(2,920)
(1,132)
291,083
Contents
NOTES TO THEFINANCIAL STATEMENTS30 SEPTEMBER 2020 1 8 6 / F R A S E R S C E N T R E P O I N T T R U S T
9.
TRADE AND OTHER RECEIVABLES
Trade receivables
Allowance for doubtful receivables
Net trade receivables
Deposits
Prepayments
Amount due from a subsidiary (non-trade)
Amount due from related parties (non-trade)
Other receivables
Loan arrangement fees
Group
2020
$’000
4,874 (a)
(209)
4,665
68
3,809
–
6
1,074
64
9,686
2019
$’000
1,419
(11)
1,408
66
189
–
23
884
572
3,142
Trust
2020
$’000
2019
$’000
4,874
(209)
4,665
68
3,782
181,874
6
1,074
64
191,533
1,419
(11)
1,408
66
162
190,231
23
884
572
193,346
Trade receivables are recognised at their original invoiced amounts which represent their fair values on initial
recognition. Non-trade amounts due from a subsidiary and related parties are unsecured, interest-free and
repayable on demand.
(a) Subsequent to 30 September 2020, $3.27 million have been collected as of 6 November 2020.
10.
CASH AND CASH EQUIVALENTS
For purpose of the consolidated cash flow statement, cash and cash equivalents comprise the following at the
balance sheet date:
Cash at bank and on hand
28,583
13,103
27,958
12,834
Group
Trust
2020
$’000
2019
$’000
2020
$’000
2019
$’000
NOTES TO THEFINANCIAL STATEMENTS30 SEPTEMBER 2020 A N N U A L R E P O R T 2 0 2 0 / 1 8 7
11.
ASSETS/LIABILITIES HELD FOR SALE
Investment property
Asset held for sale
Rental deposits
Liability held for sale
Group
Trust
2020
$’000
108,000
108,000
1,427
1,427
2019
$’000
–
–
–
–
2020
$’000
108,000
108,000
1,427
1,427
2019
$’000
–
–
–
–
On 3 September 2020, the Trust entered into a put and call option agreement to sell Bedok Point. Accordingly, the
investment property was classified to asset held for sale as at 30 September 2020.
The carrying amount of the investment property held for sale as at 30 September 2020 was based on independent
valuations undertaken by Colliers International Consultancy & Valuation (Singapore) Pte Ltd and Jones Lang
LaSalle IP, Inc using the residual valuation method. The valuation method used in determining the fair value
involves certain estimates including the gross development value (psf) and cost of construction (psf). The specific
risks inherent in the property are taken into consideration in arriving at the property valuation. The Manager
reviews the appropriateness of the valuation methodologies, assumptions and estimates adopted and is of the
view that they are reflective of the market conditions as at 30 September 2020.
The fair value measurement has been categorised as a Level 3 fair value based on the inputs to the valuation
technique used. The significant unobservable input includes gross development value per square foot and cost of
construction per square foot. An increase in the gross development value per square foot or a decrease in the cost
of construction per square foot would result in a higher fair value.
12.
TRADE AND OTHER PAYABLES
Trade payables and accrued operating expenses
Amounts due to related parties (trade)
Amounts due to a subsidiary (non-trade)
Deposits and advances
Interest payable
Other payables
Withholding tax
Group
Trust
2020
$’000
24,084
11,123
–
2,449
5,582
37
2
43,277
2019
$’000
23,277
11,187
–
2,866
5,084
76
4,839
47,329
2020
$’000
24,110
11,120
–
2,449
5,568
37
2
43,286
2019
$’000
23,298
11,187
81
2,866
5,033
76
4,839
47,380
Included in trade payables and accrued operating expenses is an amount due to the Trustee of $99,566
(2019: $92,423).
Included in amounts due to related parties are amounts due to the Manager of $7,742,022 (2019: $6,965,686)
and the Property Manager of $2,903,502 (2019: $4,008,647) respectively. The amounts due to related parties are
unsecured, interest free and payable within the next 3 months.
Contents
NOTES TO THEFINANCIAL STATEMENTS30 SEPTEMBER 2020 1 8 8 / F R A S E R S C E N T R E P O I N T T R U S T
13.
FINANCIAL DERIVATIVES
Derivative liabilities
Interest rate swaps used for hedging
– Current
– Non-current
Group and Trust
2020
$’000
2019
$’000
466
6,901
7,367
–
975
975
Financial derivatives as a percentage of net assets
0.29%
0.04%
The Trust entered into contracts to exchange, at specified intervals, the difference between floating rate and fixed
rate interest amounts calculated by reference to agreed notional amounts.
As at 30 September 2020, the Group has seven (2019: four) interest rate swap contracts with a total notional
amount of $332 million (2019: $213 million). Under the contracts, the Group pays fixed interest rate in the range
of 1.319% to 1.905% (2019: 1.587% to 1.905%).
The fair value of the interest rate swaps is determined using valuation technique as disclosed in Note 28(b).
As at 30 September 2020, where the interest rate swaps are designated as the hedging instruments in qualifying
cash flow hedges, the effective portion of the changes in fair value of the interest rate swaps amounting to
$5.30 million loss (2019: $0.03 million loss) was recognised in the hedging reserve. There was no ineffectiveness
recognised from the hedge.
14.
DEFERRED INCOME
Cost
At beginning
Additions
Fully amortised
At end
Accumulated amortisation
At beginning
Charge for the year
Fully amortised
At end
Net deferred income
This comprises:
Current portion
Non-current portion
Group and Trust
2020
$’000
2019
$’000
31
–
(29)
2
29
1
(29)
1
1
1
–
1
144
–
(113)
31
129
13
(113)
29
2
2
–
2
NOTES TO THEFINANCIAL STATEMENTS30 SEPTEMBER 2020 A N N U A L R E P O R T 2 0 2 0 / 1 8 9
15.
INTEREST-BEARING BORROWINGS
Current liabilities
Term loan (unsecured)
Medium Term Notes (unsecured)
Loan from subsidiary (unsecured)
Short term loans (unsecured)
Non-current liabilities
Term loans (secured)
Term loan (unsecured)
Loan from subsidiary (unsecured)
Medium Term Notes (unsecured)
(a)
Term loans (secured)
Group
Trust
2020
$’000
2019
$’000
2020
$’000
2019
$’000
80,000
50,000
–
125,000
255,000
189,335
508,296
–
299,677
997,308
–
159,966
–
135,083
295,049
405,049
189,856
–
149,851
744,756
80,000
–
50,000
125,000
255,000
189,335
318,152
299,677
–
807,164
–
–
159,966
135,083
295,049
405,049
–
149,851
–
554,900
(i)
In December 2016, the Trust entered into a facility agreement with DBS Bank Ltd for a secured
five-year term loan of $70 million (the “$70 million Secured Term Loan”).
The $70 million Secured Term Loan is principally secured by the following:
•
•
•
a mortgage over Bedok Point;
an assignment of the rights, benefits, title and interest of the Trust in, under and arising out
of the insurances effected in respect of Bedok Point; and
an assignment and charge of the rights, benefits, title and interest of the Trust in, under and
arising out of the tenancy agreements, the sale agreements, the performance guarantees
(including sale proceeds and rental proceeds) and the bank accounts arising from, relating to
or in connection with Bedok Point.
The $70 million Secured Term Loan had been fully repaid on 21 June 2019 and its collaterals had
been discharged.
(ii)
In March 2016, the Trust entered into a facility agreement with DBS Bank Ltd for a secured five-year
term loan of $80 million (the “$80 million Secured Term Loan”).
The $80 million Secured Term Loan is principally secured by the following:
•
•
•
a mortgage over Anchorpoint;
an assignment of the rights, benefits, title and interest of the Trust in, under and arising out
of the insurances effected in respect of Anchorpoint; and
an assignment and charge of the rights, benefits, title and interest of the Trust in, under and
arising out of the tenancy agreements, the sale agreements, the performance guarantees
(including sale proceeds and rental proceeds) and the bank accounts arising from, relating to
or in connection with Anchorpoint.
The $80 million Secured Term Loan has been prepaid on 7 October 2020 and discharge of the above
collaterals is in progress.
Contents
NOTES TO THEFINANCIAL STATEMENTS30 SEPTEMBER 2020 1 9 0 / F R A S E R S C E N T R E P O I N T T R U S T
15.
INTEREST-BEARING BORROWINGS (CONT’D)
(a)
Term loans (secured) (cont’d)
(iii)
In June 2016, the Trust entered into a facility agreement with Oversea-Chinese Banking Corporation
Limited and DBS Bank Ltd for a secured five-year term loan of $136 million (the “$136 million
Secured Term Loan”).
The $136 million Secured Term Loan is principally secured by the following:
•
•
•
a mortgage over YewTee Point;
an assignment of the rights, benefits, title and interest of the Trust in, under and arising out
of the insurances effected in respect of YewTee Point; and
an assignment and charge of the rights, benefits, title and interest of the Trust in, under and
arising out of the tenancy agreements, the sale agreements, the performance guarantees
(including sale proceeds and rental proceeds) and the bank accounts arising from, relating to
or in connection with YewTee Point.
The $136 million Secured Term Loan had been fully repaid on 11 May 2020 and its collaterals had
been discharged.
(iv)
In April 2019, the Trust entered into a facility agreement with BNP Paribas for a secured three- and
five-year term loan of S$190 million (the “S$190 million Secured Term Loan”).
The S$190 million Secured Term Loan is principally secured on the following:
•
•
•
•
a mortgage over Changi City Point;
an assignment of the rights, benefits, title and interest of the Trust in, under and arising out
of the insurances effected in respect of Changi City Point;
an assignment and charge of the rights, benefits, title and interest of the Trust in, under and
arising out of the tenancy agreements, the sale agreements, the performance guarantees
(including sale proceeds and rental proceeds) and the bank accounts arising from, relating to
or in connection with Changi City Point; and
a first fixed and floating charge over all present and future assets of FCT in connection with
Changi City Point.
(b)
Term loans (unsecured)
In September 2019, FCT Holdings (Sigma) Pte. Ltd. entered into a facility agreement with DBS Bank Ltd,
Citibank N.A. Singapore branch and BNP Paribas for an unsecured four-year term loan of $191 million.
In December 2019, the Trust entered into a facility agreement with DBS Bank Ltd, Citibank N.A. Singapore
branch and BNP Paribas for an unsecured four-year term loan of $119 million.
NOTES TO THEFINANCIAL STATEMENTS30 SEPTEMBER 2020 A N N U A L R E P O R T 2 0 2 0 / 1 9 1
15.
INTEREST-BEARING BORROWINGS (CONT’D)
(c) Medium Term Notes (unsecured) Programme
On 7 May 2009, the Group through its subsidiary, FCT MTN Pte Ltd (“FCT MTN”), established a $500,000,000
Multicurrency Medium Term Note Programme (“FCT MTN Programme”). With effect from 14 August 2013,
the maximum aggregate principal amount of notes that may be issued under the FCT MTN Programme was
increased from $500,000,000 to $1,000,000,000. Under the FCT MTN Programme, FCT MTN may, subject
to compliance with all relevant laws, regulations and directives, from time to time issue notes (the “Notes”)
in Singapore dollars or any other currency. The Notes may be issued in various amounts and tenors, and
may bear interest at fixed, floating, hybrid or variable rates of interest. Hybrid notes or zero coupon notes
may also be issued under the FCT MTN Programme.
The Notes shall constitute direct, unconditional, unsubordinated and unsecured obligations of FCT MTN
ranking pari passu, without any preference or priority among themselves, and pari passu with all other
present and future unsecured obligations (other than subordinated obligations and priorities created by
law) of FCT MTN. All sums payable in respect of the Notes are unconditionally and irrevocably guaranteed
by the Trustee.
As at 30 September 2020, the aggregate balance of the Notes issued by the Group under the FCT MTN
Programme amounted to $150 million (2019: $310 million), consisting of:
(i)
(ii)
(iii)
(iv)
(v)
$Nil million (2019: $70 million) Fixed Rate Notes which mature on 21 January 2020 and bear a fixed
interest rate of 3.000% per annum payable semi-annually in arrear;
$50 million (2019: $50 million) Fixed Rate Notes which mature on 21 June 2021 and bear a fixed
interest rate of 2.760% per annum payable semi-annually in arrear;
$Nil million (2019: $90 million) Fixed Rate Notes which mature on 3 April 2020 and bear a fixed
interest rate of 2.365% per annum payable semi-annually in arrear;
$30 million (2019: $30 million) Fixed Rate Notes which mature on 6 June 2022 and bear a fixed
interest rate of 2.645% per annum payable semi-annually in arrear; and
$70 million (2019: $$70 million) Fixed Rate Notes which mature on 8 November 2024 and bear a
fixed interest rate of 2.770% per annum payable semi-annually in arrears.
(d) Multicurrency Debt (unsecured) Issuance Programme
On 8 February 2017, the Group established a $3 billion Multicurrency Debt Issuance Programme (“Debt
Issuance Programme”). Under the Debt Issuance Programme, the Issuers may, subject to compliance with
all relevant laws, regulations and directives from time to time, issue notes (the “Notes”) and perpetual
securities (the “Perpetual Securities”, and together with the Notes, the “Securities”) in Singapore dollars
or any other currency as may be agreed between the relevant dealers of the Programme and the Issuers.
Each series or tranche of Notes may be issued in various amounts and tenors, and may bear interest at
fixed, floating, hybrid or variable rates as may be agreed between the relevant dealers of the Debt Issuance
Programme and the relevant Issuer or may not bear interest. The Notes and the coupons of all series shall
constitute direct, unconditional, unsubordinated and unsecured obligations of the relevant Issuer and shall
at all times rank pari passu, without any preference or priority among themselves, and pari passu with all
other present and future unsecured obligations (other than subordinated obligations and priorities created
by law) of the relevant Issuer.
As at 30 September 2020, $200 million (2019: $Nil million) Fixed Rate Notes which mature on 11 May 2023
and bear a fixed rate interest rate of 3.200% per annum payable semi-annually in arrears has been issued
under this programme.
Contents
NOTES TO THEFINANCIAL STATEMENTS30 SEPTEMBER 2020
1 9 2 / F R A S E R S C E N T R E P O I N T T R U S T
15.
INTEREST-BEARING BORROWINGS (CONT’D)
(e)
Revolving credit facilities (Non-current and unsecured)
In July 2020, the Trust entered into an agreement with DBS Bank Ltd for a committed 18-month term
revolving credit facility of $120 million and with Oversea-Chinese Banking Corporation Limited for
a committed 18-month term revolving credit facility of $80 million. As at 30 September 2020, total
borrowings drawn down by the Trust on these unsecured facilities amounted to $200 million.
(f)
Short term loans (current and unsecured)
The Trust has obtained unsecured credit facilities totalling $245 million (2019: $314 million). As at
30 September 2020, total borrowings drawn down by the Trust on these facilities amounted to $125.0
million (2019: $135.1 million).
Reconciliation of movements of liabilities to cash flows arising from financing activities
Liabilities
Interest-
bearing
borrowings
$’000
Interest
payable
$’000
Derivative liabilities held
to hedge borrowings
Interest
rate swap –
assets
$’000
Interest
rate swap –
liabilities
$’000
Total
$’000
812,588
4,213
(56)
–
816,745
1,121,115
(892,032)
–
(2,540)
–
–
(22,627)
–
226,543 (22,627)
–
–
–
–
–
– 1,121,115
(892,032)
–
(22,627)
–
(2,540)
–
203,916
–
–
–
56
975
1,031
–
674
674
1,039,805
23,498
–
23,498
5,084
1,039,805
5,084
793,000
(580,083)
–
(1,254)
–
–
(25,755)
–
211,663 (25,755)
–
–
–
840
840
1,252,308
26,253
–
26,253
5,582
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
23,498
674
24,172
975 1,045,864
975 1,045,864
–
–
–
–
–
793,000
(580,083)
(25,755)
(1,254)
185,908
6,392
6,392
–
–
–
26,253
840
27,093
7,367 1,265,257
Group
Balance at 1 October 2018
Changes from financing cash flows
Proceeds from borrowings
Repayment of borrowings
Borrowing costs paid
Payment of transaction costs
Total changes from financing cash flows
Change in fair value
Liability-related other changes
Borrowing costs
Amortisation of loan arrangement fees
Total liability-related other changes
Balance at 30 September 2019
Balance at 1 October 2019
Changes from financing cash flows
Proceeds from borrowings
Repayment of borrowings
Borrowing costs paid
Payment of transaction costs
Total changes from financing cash flows
Change in fair value
Liability-related other changes
Borrowing costs
Amortisation of loan arrangement fees
Total liability-related other changes
Balance at 30 September 2020
NOTES TO THEFINANCIAL STATEMENTS30 SEPTEMBER 2020 A N N U A L R E P O R T 2 0 2 0 / 1 9 3
16.
TRANSLATION RESERVE
The translation reserve represents exchange differences arising from the translation of the financial statements of
foreign operations whose functional currency is different from that of the Group’s presentation currency.
At beginning
Net effect of exchange loss arising from translation of
financial statements of foreign associate
At end
17. HEDGING RESERVE
Group
2020
$’000
2019
$’000
18,829
18,816
170
18,999
13
18,829
The hedging reserve comprises the effective portion of the cumulative net change in the fair value of hedging
instruments used in cash flow hedges pending subsequent recognition in profit or loss.
At beginning
Net change in the fair value of hedging
instruments used in cash flow hedges pending
subsequent recognition in profit or loss
At end
Group
Trust
2020
$’000
33
5,297
5,330
2019
$’000
–
33
33
2020
$’000
–
4,642
4,642
2019
$’000
–
–
–
Contents
NOTES TO THEFINANCIAL STATEMENTS30 SEPTEMBER 2020 1 9 4 / F R A S E R S C E N T R E P O I N T T R U S T
18.
UNITS IN ISSUE
Group and Trust
2020
2019
No. of Units No. of Units
’000
’000
Units in issue
At beginning
Issue of Units
– Private placement and preferential offering
– issued as satisfaction of asset management fees
– issued as satisfaction of acquisition fee
At end
Units to be issued
– as asset management fees payable in Units
Total issued and issuable Units at end
1,116,284
926,392
–
2,336
827
1,119,447
184,000
2,154
3,738
1,116,284
883
1,120,330
1,225
1,117,509
Each Unit represents an undivided interest in the Trust. The rights and interests of Unitholders are contained in the
Trust Deed and include the rights to:
•
•
•
receive income and other distributions attributable to the Units held;
participate in the termination of the Trust by receiving a share of all net cash proceeds derived from the
realisation of the assets of the Trust less any liabilities, in accordance with their proportionate interests
in the Trust. However, a Unitholder has no equitable or proprietary interest in the underlying assets of the
Trust and is not entitled to the transfer to it of any assets (or part thereof) or of any estate or interest in any
assets (or part thereof) of the Trust;
attend all Unitholders’ meetings. The Trustee or the Manager may (and the Manager shall at the request in
writing of not less than 50 Unitholders or one-tenth number of the Unitholders, whichever is lesser) at any
time convene a meeting of Unitholders in accordance with the provisions of the Trust Deed; and
•
one vote per Unit.
The restrictions of a Unitholder include the following:
•
•
•
a Unitholder’s right is limited to the right to require due administration of the Trust in accordance with the
provisions of the Trust Deed; and
a Unitholder has no right to request the Manager to redeem his Units while the Units are listed on SGX-ST.
A Unitholder’s liability is limited to the amount paid or payable for any Units in the Trust. The provisions of
the Trust Deed provide that no Unitholders will be personally liable to indemnify the Trustee or any creditor
of the Trustee in the event that liabilities of the Trust exceed its assets.
NOTES TO THEFINANCIAL STATEMENTS30 SEPTEMBER 2020 A N N U A L R E P O R T 2 0 2 0 / 1 9 5
19. NET ASSET VALUE PER UNIT
Group
Trust
2020
$’000
2019
$’000
2020
$’000
2019
$’000
Net asset value per Unit is based on:
Net assets
2,538,276
2,471,059
2,462,726
2,454,234
Total issued and issuable Units (Note 18)
1,120,330
1,117,509
1,120,330
1,117,509
’000
’000
’000
’000
20.
GROSS REVENUE
Gross rental income
Turnover rental income
Carpark income
Others
Gross rental income
Group and Trust
2020
$’000
147,190
7,824
3,007
6,356
164,377
2019
$’000
173,494
9,441
4,656
8,795
196,386
The Group has granted rental relief to a number of its tenants in light of mandatory government shutdowns,
increased social distancing and work from home measures. Each rental relief request has been reviewed and
considered on a case-by-case basis. The relief provided are mainly rental rebates, rental payment deferrals or a
combination of these.
Contents
NOTES TO THEFINANCIAL STATEMENTS30 SEPTEMBER 2020 1 9 6 / F R A S E R S C E N T R E P O I N T T R U S T
21.
PROPERTY EXPENSES
Property tax
Maintenance
Property management fees
Staff costs (1)
Marketing expenses
Utilities
Allowance for doubtful receivables
Write back of allowance for doubtful receivables
Others
Depreciation of fixed assets
Amortisation of intangible assets
Fixed assets write off
Group and Trust
2020
$’000
18,159
14,877
6,184
7,250
4,340
1,657
1,297
(1,099)
762
56
–
6
53,489
2019 (2)
$’000
16,911
13,916
7,569
8,185
7,255
2,063
8
(16)
1,107
93
12
–
57,103
(1) Relates to reimbursement of staff costs paid/payable to the Property Manager.
(2) During the financial year, the Group and Trust reclassified certain property expenses and comparative figures have been reclassified to conform
with the current year’s presentation.
The Group and the Trust do not have any employees.
22. OTHER INCOME
Government grant income
Government grant expense
23.
BORROWING COSTS
Interest expense
Amortisation of loan arrangement fees
2020
$’000
18,533
(18,533)
Group
Trust
2019
$’000
2020
$’000
–
–
18,533
(18,533)
2019
$’000
–
–
Group
Trust
2020
$’000
26,256
1,347
27,603
2019
$’000
23,512
1,136
24,648
2020
$’000
22,438
1,060
23,498
2019
$’000
23,462
1,134
24,596
NOTES TO THEFINANCIAL STATEMENTS30 SEPTEMBER 2020 A N N U A L R E P O R T 2 0 2 0 / 1 9 7
24.
ASSET MANAGEMENT FEES
Asset management fees comprise $11,936,345 (2019: $9,567,971) of base fee and $6,494,110 (2019:
$7,187,918) of performance fee computed in accordance with the fee structure as disclosed in Note 1.2 to the
financial statements.
An aggregate of 1,994,085 (2019: 2,116,627) Units were issued or are issuable to the Manager as satisfaction of
the asset management fees payable for the financial year ended 30 September 2020.
25.
TAXATION
Reconciliation of effective tax
Net income
Income tax using Singapore tax rate of 17%
(2019: 17%)
Non-tax deductible items
Income not subject to tax
Income exempt from tax
26.
EARNINGS PER UNIT
(i)
Basic earnings per Unit
Group
Trust
2020
$’000
2019
$’000
2020
$’000
2019
$’000
65,407
96,677
68,956
96,602
11,119
(4,699)
5,639
(11,977)
82
16,435
1,398
1,828
(19,650)
11
11,723
1,372
2,301
(15,396)
–
16,422
1,460
1,803
(19,685)
–
The calculation of basic earnings per Unit is based on the weighted average number of Units during the year and
total return for the year.
Group
Trust
2020
2019
2020
2019
Total return for year after tax ($’000)
151,676
205,945
91,120
190,451
Weighted average number of Units in issue (’000)
1,118,086
991,076
1,118,086
991,076
(ii)
Diluted earnings per Unit
In calculating diluted earnings per unit, the total return for the year and weighted average number of Units
outstanding are adjusted for the effect of all dilutive potential units, as set out below:
Total return for year after tax ($’000)
151,676
205,945
91,120
190,451
Weighted average number of Units in issue (’000)
1,119,618
992,819
1,119,618
992,819
Group
Trust
2020
2019
2020
2019
Contents
NOTES TO THEFINANCIAL STATEMENTS30 SEPTEMBER 2020 1 9 8 / F R A S E R S C E N T R E P O I N T T R U S T
27.
SIGNIFICANT RELATED PARTY TRANSACTIONS
During the financial year, other than the transactions disclosed in the financial statements, the following related
party transactions were carried out in the normal course of business on arm’s length commercial terms:
Related Corporations
Property management fees and reimbursement of expenses paid/payable
to the Property Manager (1)
Acquisition fees paid in units to the Manager in relation to the acquisitions
Reimbursement of expenses paid/payable to the Manager
Acquisition of investment in a joint venture from a related
company of the Manager
Reimbursement of expenses/capital expenditure paid/payable to related
companies of the Manager
Recovery of expenses paid on behalf of related companies of the Manager
Income from related companies of the Manager
Purchase of services from a related company of the Manager
Reimbursement of carpark income received on behalf of a related
company of the Manager
Net carpark expenses paid/payable to the Property Manager
Joint Ventures
Interest income received/receivable from a Joint Venture
Loan to a Joint Venture
Car park expenses paid/payable to a Joint Venture
(1)
In accordance with service agreements in relation to management of the Trust and its property operations.
Group and Trust
2020
$’000
2019
$’000
16,231
1,972
28
18,231
8,999
64
68
145,665
418
(132)
(190)
41
1,578
89
144
(122)
(16)
–
1,932
170
(2,211)
–
27
(587)
113,810
33
28.
FAIR VALUE OF ASSETS AND LIABILITIES
(a)
Liabilities measured at fair value
Group and Trust
At 30 September 2020
Financial liabilities
Interest rate swaps
At 30 September 2019
Financial liabilities
Interest rate swaps
Level 1
$’000
Level 2
$’000
Level 3
$’000
Total
$’000
–
–
7,367
975
–
–
7,367
975
During the financial years ended 30 September 2020 and 2019, there have been no transfers between the
respective levels.
NOTES TO THEFINANCIAL STATEMENTS30 SEPTEMBER 2020 A N N U A L R E P O R T 2 0 2 0 / 1 9 9
28.
FAIR VALUE OF ASSETS AND LIABILITIES (CONT’D)
(b)
Level 2 fair value measurements
Interest rate swap contracts are valued using present value calculations by applying market observable
inputs existing at each reporting date into swap models. The models incorporate various inputs including
the credit quality of counterparties and interest rate curves.
(c)
Fair value of financial liabilities that are not carried at fair value and whose carrying amounts are not
reasonable approximation of fair values
The following fair values, which are determined for disclosure purposes, are estimated by discounting
expected future cash flows at market incremental lending rates for similar types of lending or borrowing
arrangements at the reporting date:
Group
Financial liabilities
Interest-bearing borrowings (non-current)
Security deposits (non-current)
Trust
Financial liabilities
Interest-bearing borrowings (non-current)
Security deposits (non-current)
2020
$’000
2019
$’000
Carrying
amount
Fair value
Carrying
amount
Fair value
997,308
23,813
1,021,121
1,011,974
23,422
1,035,396
744,756
29,093
773,849
773,654
27,911
801,565
807,164
23,813
830,977
817,707
23,422
841,129
554,900
29,093
583,993
569,656
27,911
597,567
(d)
Fair value of financial assets and liabilities that are not carried at fair value and whose carrying amounts
are reasonable approximation of fair values
The carrying amounts of financial assets and liabilities with maturity of less than one year (including trade
and other receivables, cash and cash equivalents, trade and other payables, current portion of security
deposits and current portion of interest-bearing borrowings) are reasonable approximation of fair values,
either due to their short-term nature or that they are floating rate instruments that are re-priced to market
interest rates on or near the reporting date.
Contents
NOTES TO THEFINANCIAL STATEMENTS30 SEPTEMBER 2020 2 0 0 / F R A S E R S C E N T R E P O I N T T R U S T
29.
FINANCIAL RISK MANAGEMENT
(a)
Capital risk management
The primary objective of the Group’s capital management is to ensure that it maintains a strong and healthy
capital structure in order to support its business and maximise Unitholder value.
The Group is subject to the aggregate leverage limit as defined in the Property Fund Guidelines of the CIS
Code. The CIS Code stipulates that borrowings and deferred payments (together the “Aggregate Leverage”)
of a property fund should not exceed 50.0% of the fund’s depository property before 1 January 2022 and
on or after 1 January 2022, should not exceed 45.0% of the fund’s depository property.
As at 30 September 2020, the Group’s Aggregate Leverage stood at 35.9% (2019: 32.9%) of its depository
property, which is within the limit set by the Property Fund Guidelines and externally imposed capital
requirements. The Trust has affirmed its corporate ratings of “BBB” from S&P Global Ratings and “Baa2”
from Moody’s Investors Service.
(b)
Financial risk management objectives and policies
Exposure to credit, interest rate and liquidity risks arises in the normal course of the Group’s business. The
Manager continually monitors the Group’s exposure to the above risks. There has been no change to the
Group’s exposure to these financial risks or the manner in which it manages and measures risks.
(i)
Credit risk
Credit risk is the potential financial loss resulting from the failure of a customer or counterparty to
settle its financial and contractual obligations to the Group as and when they fall due.
The Group’s objective is to seek continual revenue growth while minimising losses incurred due to
increased credit risk exposure. The Manager has established credit limits for tenants and monitors
their balances on an ongoing basis. Credit evaluations are performed by the Manager before lease
agreements are entered into with tenants. Credit risk is also mitigated by the security deposits held
for each of the tenants. In addition, receivables are monitored on an ongoing basis with the result
that the Group’s exposure to bad debts is not significant.
Trade receivables
The Manager has established an allowance account for impairment that represents its estimate of
losses in respect of trade receivables due from specific customers. Subsequently when the Group is
satisfied that no recovery of such losses is possible, the financial asset is considered irrecoverable
and the amount charged to the allowance account is written off against the carrying amount of the
impaired financial asset.
The maximum exposure to credit risk is represented by the carrying value of each financial asset on
the Balance Sheets. At the reporting date, approximately 19.5% (2019: 25.0%) of the Group’s trade
receivables were due from 5 tenants who are reputable companies located in Singapore.
The Group uses an allowance matrix to measure the ECLs of trade receivables from individual
tenants, which comprise a very large number of tenants.
Loss rates are calculated using a ‘roll rate’ method based on the probability of a receivable progressing
through successive stages of delinquency to write-off based on actual credit loss experience over
the last three years.
NOTES TO THEFINANCIAL STATEMENTS30 SEPTEMBER 2020 A N N U A L R E P O R T 2 0 2 0 / 2 0 1
29.
FINANCIAL RISK MANAGEMENT (CONT’D)
(b)
Financial risk management objectives and policies (cont’d)
(i)
Credit risk (cont’d)
Trade receivables that are past due but not impaired
The Group and the Trust have trade receivables amounting to $4,665,000 (2019: $1,408,000) that
are past due at the balance sheet date but not impaired. The aging of receivables at the balance
sheet date is as follows:
Trade receivables past due but not impaired:
Less than 30 days
30 to 60 days
61 to 90 days
91 to 120 days
More than 120 days
* Denotes amount less than $500
Group and Trust
2020
$’000
2,271
1,767
*
479
148
4,665
2019
$’000
1,222
99
55
19
13
1,408
Subsequent to 30 September 2020, $3.37 million of trade receivables have been collected as of 7
November 2020.
Trade receivables that are impaired
Trade receivables of the Group and the Trust that are impaired at the reporting date and the
movements of the allowance account used to record the impairment are as follows:
Trade receivables
Allowance for doubtful receivables
Movement in allowance account:
At beginning of the year
Allowance for doubtful receivables recognised
Write back of allowance for doubtful receivables
At end of the year
Group and Trust
2020
$’000
209
(209)
–
11
1,297
(1,099)
209
2019
$’000
11
(11)
–
19
8
(16)
11
Trade receivables that are individually determined to be impaired at the balance sheet date relate
to debtors that are in significant difficulties and have defaulted on payments. The allowance for
impairment recorded in relation to these receivables represents the amount in excess of the security
deposits held as collateral.
Based on the Group’s historical experience of the collection of trade receivables, the Manager
believes that there is no additional credit risk beyond those which have been provided for.
Contents
NOTES TO THEFINANCIAL STATEMENTS30 SEPTEMBER 2020 2 0 2 / F R A S E R S C E N T R E P O I N T T R U S T
29.
FINANCIAL RISK MANAGEMENT (CONT’D)
(b)
Financial risk management objectives and policies (cont’d)
(i)
Credit risk (cont’d)
Deposits and other receivables
Impairment on these balances has been measured on the 12-month expected loss basis which
reflects the short maturity and low credit risks of the exposure. The amount of the allowance on
these balances is insignificant.
Amount due from related parties and subsidiaries
Outstanding balances with related party are unsecured and repayable on demand. ELC is assessed
from estimated cash flows recoverable from the related parties and subsidiaries based on the review
of their financial strength as at the reporting date. There is no allowance for doubtful debts arising
from these outstanding balances as the ECL is not material.
Loan to joint venture
The Group has loan to joint venture of $113,810,000 (2019: $113,810,000). The loan to joint
venture is to satisfy their long term funding requirements. Based on an assessment of qualitative
and qualitative factors that are indicative of the risk of default, the exposure is considered to have
low credit risk. Therefore impairment on the balance has been measured on the 12-month expected
credit loss basis; and the amount of the allowance is insignificant.
Cash and cash equivalent
Cash is placed with financial institutions which are regulated. The maximum exposure to credit risk
is represented by the carrying value on the balance sheets. Impairment on cash and cash equivalent
has been measured on the 12-month expected loss basis and reflects the short maturities of the
exposure. The Group considers that its cash and cash equivalents have low credit risk based on
the external credit ratings of the counterparties. The amount of the allowance on cash and cash
equivalents was negligible.
(ii)
Interest rate risk
The Group’s exposure to changes in interest rates relates primarily to its interest-earning financial
assets and interest-bearing financial liabilities. Interest rate risk is managed by the Manager on
an ongoing basis with the primary objective of limiting the extent to which net interest expense
could be affected by adverse movements in interest rates. The Manager adopts a policy of fixing the
interest rates for a portion of its outstanding borrowings using financial derivatives or other suitable
financial products.
Derivatives
The Group holds interest rate swaps for risk management purposes which are designated in cash
flow hedging relationships. The interest rate swaps have floating legs that are indexed to Singapore
swap offer rates (“SOR”). The Group’s derivative instruments are governed by contracts based on
the International Swaps and Derivatives Association (“ISDA”)’s master agreements. The Group is
currently in discussions with counterparties of respective contracts. No derivative instruments have
been modified as at 30 September 2020.
NOTES TO THEFINANCIAL STATEMENTS30 SEPTEMBER 2020 A N N U A L R E P O R T 2 0 2 0 / 2 0 3
29.
FINANCIAL RISK MANAGEMENT (CONT’D)
(b)
Financial risk management objectives and policies (cont’d)
(ii)
Interest rate risk (cont’d)
Hedge accounting
The Group has evaluated the extent to which its cash flow hedging relationships are subject to
uncertainty driven by IBOR reform as at 30 September 2020. The Group’s hedged items and hedging
instruments continue to be indexed to IBOR benchmark rate which is SOR.
The Group’s SOR cash flow hedging relationships extend beyond the anticipated cessation date
for IBOR. However, there is uncertainty about when and how replacement may occur with respect
to the relevant hedged items and hedging instruments. Such uncertainty may impact the hedging
relationship. The Group applies the amendments to FRS 109 issued to those hedging relationships
directly affected by IBOR reform.
Hedging relationships impacted by IBOR reform may experience ineffectiveness attributable to
market participants’ expectations of when the shift from the existing IBOR benchmark rate to an
alternative benchmark interest rate will occur. This transition may occur at different times for the
hedged item and hedging instrument, which may lead to hedge ineffectiveness.
The Group’s exposure to SOR designated in hedging relationships is $332 million notional amount at
30 September 2020, representing both the notional amount of the hedging interest rate swaps and
principal amount of the Group’s hedged bank loan liabilities.
Sensitivity analysis for interest rate risk
It is estimated that a twenty five basis points increase in interest rate at the reporting date, with
all other variables held constant, would increase the Group’s total return and Unitholders’ funds
and reserves by approximately $204,000 (2019: $644,000) and $1,232,000 (2019: $829,000)
respectively and a twenty five basis points decrease in interest rate, with all other variables
held constant, would decrease the Group’s total return and Unitholders’ funds and reserves by
approximately $203,000 (2019: $671,000) and $1,242,000 (2019: $837,000) respectively, arising
mainly as a result of change in the fair value of interest rate swap instruments. On outstanding
borrowings not covered by financial derivatives at the reporting date, it is estimated that a twenty
five basis points increase in interest rate, with all other variables held constant, would decrease the
Group’s total return for the year and Unitholders’ funds and reserves by approximately $1,432,500
(2019: $1,298,000) and a twenty five basis points decrease in interest rate, with all other variables
held constant, would increase the Group’s total return for the year and Unitholders’ funds and
reserves by approximately $1,432,500 (2019: $1,298,000), arising mainly as a result of lower/higher
interest expense on floating rate loans and borrowings. The assumed movement in basis points for
interest rate sensitivity analysis is based on current observable market environment.
Contents
NOTES TO THEFINANCIAL STATEMENTS30 SEPTEMBER 2020 2 0 4 / F R A S E R S C E N T R E P O I N T T R U S T
29.
FINANCIAL RISK MANAGEMENT (CONT’D)
(b)
Financial risk management objectives and policies (cont’d)
(iii)
Liquidity risk
Liquidity risk is the risk that the Group will encounter difficulty in meeting financial obligations
due to shortage of funds. The Group’s objective is to maintain sufficient cash on demand to
meet expected operational expenses for a reasonable period, including the servicing of financial
obligations. The Manager monitors and maintains a level of cash and cash equivalents deemed
adequate to finance the Group’s operations and to mitigate the effects of fluctuations in cash flows.
In addition, the Manager monitors and observes the CIS Code issued by the MAS concerning limits
on total borrowings.
The table below summarises the maturity profile of the Group’s and the Trust’s financial liabilities at
the reporting date based on contractual undiscounted payments.
As at 30 September 2020
Group
Trade and other payables
Derivative financial instruments
Security deposits
Interest-bearing borrowings
Trust
Trade and other payables
Derivative financial instruments
Security deposits
Interest-bearing borrowings
As at 30 September 2019
Group
Trade and other payables
Derivative financial instruments
Security deposits
Interest-bearing borrowings
Trust
Trade and other payables
Derivative financial instruments
Security deposits
Interest-bearing borrowings
Within
1 year
$’000
1 to 5
years
$’000
More than
5 years
$’000
Total
$’000
43,277
4,187
16,708
271,281
335,453
43,286
4,187
16,708
269,652
333,833
42,490
421
22,612
313,304
378,827
42,541
421
22,612
309,022
374,596
–
3,605
23,788
1,026,669
1,054,062
–
3,605
23,788
832,401
859,794
–
584
29,068
714,796
744,448
–
584
29,068
510,798
540,450
–
–
25
–
25
–
–
25
–
25
–
–
25
70,202
70,227
–
–
25
70,202
70,227
43,277
7,792
40,521
1,297,950
1,389,540
43,286
7,792
40,521
1,102,053
1,193,652
42,490
1,005
51,705
1,098,302
1,193,502
42,541
1,005
51,705
890,022
985,273
NOTES TO THEFINANCIAL STATEMENTS30 SEPTEMBER 2020 A N N U A L R E P O R T 2 0 2 0 / 2 0 5
30.
SEGMENT REPORTING
Business segments
The Group is in the business of investing in the following shopping malls, which are considered to be the main
business segments: Causeway Point, Northpoint City North Wing and Yishun 10 Retail Podium, Anchorpoint,
YewTee Point, Bedok Point and Changi City Point. All these properties are located in Singapore.
The Manager monitors the operating results of the business segments separately for the purpose of making
decisions about resource allocation and performance assessment. Segment information is presented in respect of
the Group’s business segments, based on its management and internal reporting structure.
Segment results, assets and liabilities include items directly attributable to a segment as well as those that can
be allocated on a reasonable basis. Unallocated items comprise mainly income-earning assets, interest-bearing
borrowings and their related revenue and expenses.
Segment capital expenditure is the total costs incurred during the year to acquire segment assets that are
expected to be used for more than one year.
Geographical segments
The Group’s operations are primarily in Singapore except for its associate, H-REIT for which operations are
in Malaysia.
Contents
NOTES TO THEFINANCIAL STATEMENTS30 SEPTEMBER 2020 2 0 6 / F R A S E R S C E N T R E P O I N T T R U S T
30.
SEGMENT REPORTING (CONT’D)
(a)
Business segments
Northpoint City
North Wing
and Yishun 10
Retail Podium
$’000
Causeway
Point
$’000
Anchor-
point
$’000
YewTee
Point
$’000
Bedok
Point *
$’000
Changi
City Point
$’000
Group
$’000
65,930
7,307
73,237
40,375
4,021
44,396
6,129 11,089
1,399
6,873 12,488
744
4,812
837
5,649
18,855 147,190
17,187
21,734 164,377
2,879
2020
Revenue and expenses
Gross rental income
Others
Gross revenue
Segment net
property income
52,929
31,531
2,996
8,306
2,023
13,103 110,888
Interest income
Other income
Interest income from
joint venture
Unallocated expenses *
Net income
Unrealised loss from
fair valuation
of derivatives
Share of results
of associates
Share of results
of joint ventures
Expenses in relation
to acquisitions
of an associate and
a joint venture
Surplus on revaluation
of investment
properties
Total return for
the year before tax
Taxation
Total return for the year
14
586
2,211
(48,292)
65,407
(1,095)
75,280
11,200
(3,781)
(157)
(2,619)
(3,621)
920 14,106
(3,882)
4,747
151,758
(82)
151,676
*
Bedok Point has been reclassified to Asset Held for Sale as at 30 September 2020 (Note 11).
NOTES TO THEFINANCIAL STATEMENTS30 SEPTEMBER 2020 A N N U A L R E P O R T 2 0 2 0 / 2 0 7
30.
SEGMENT REPORTING (CONT’D)
(a)
Business segments (cont’d)
Northpoint City
North Wing
and Yishun 10
Retail Podium
$’000
Causeway
Point
$’000
Anchor-
point
$’000
YewTee
Point
$’000
Bedok
Point
$’000
Changi
City Point
$’000
Group
$’000
76,562
9,896
86,458
47,411
5,678
53,089
7,367 12,534
1,188
1,909
8,555 14,443
5,786
720
6,506
23,834 173,494
22,892
27,335 196,386
3,501
2019
Revenue and expenses
Gross rental income
Others
Gross revenue
Segment net
property income
65,765
39,213
3,808 10,308
2,663
17,526 139,283
131
587
(43,324)
96,677
(998)
22,548
6,409
(1,132)
(10,838)
75,884
1,547
3,045
2,672
21
10,121
93,290
Other income
Interest income from
joint venture
Unallocated expenses *
Net income
Unrealised loss from
fair valuation
of derivatives
Share of results
of associates
Share of results
of joint ventures
Impairment loss on
investment in
joint venture
Expenses in relation
to acquisitions
of an associate and
a joint venture
Surplus on revaluation
of investment
properties
Total return for
the year before tax
Taxation
Total return for the year
*
Unallocated expenses include borrowing costs and asset management fees as disclosed in the Statements of Total Return.
205,956
(11)
205,945
Contents
NOTES TO THEFINANCIAL STATEMENTS30 SEPTEMBER 2020 2 0 8 / F R A S E R S C E N T R E P O I N T T R U S T
30.
SEGMENT REPORTING (CONT’D)
(a)
Business segments (cont’d)
Northpoint City
North Wing
and Yishun 10
Retail Podium
$’000
Causeway
Point
$’000
Anchor-
point
$’000
YewTee
Point
$’000
Bedok
Point *
$’000
Changi
City Point
$’000
Group
$’000
1,314,593
814,861 112,808 192,964 109,755
343,502 2,888,483
696,406
177,197
113,810
7,515
3,883,411
26,769
18,085
3,129
5,943
2,686
9,864
66,476
18,898
86
7,367
1,252,308
1,345,135
As at
30 September 2020
Assets and liabilities
Segment assets
Investment in associate
Investment in
joint venture
Loan to joint venture
Unallocated assets
Total assets
Segment liabilities
Unallocated liabilities
– Trade and
other payables
– Provision for taxation
– Financial derivatives
– Interest-bearing
borrowings
Total liabilities
Other segmental
information
Allowance for
doubtful receivables
626
336
20
64
46
205
1,297
Write back of
allowance for
doubtful receivables
Amortisation of
lease incentives
Depreciation of
fixed assets
Fixed assets write off
(578)
(127)
12
–
Capital expenditure
– Investment properties
– Fixed assets
7,030
92
(218)
(14)
(64)
(46)
(179)
(1,099)
1,136
(109)
(22)
116
442
1,436
8
1
755
40
16
5
12
11
4
–
58
6
5
–
10
4
11
–
56
6
324
53
8,189
206
*
Bedok Point has been reclassified to Asset Held for Sale as at 30 September 2020 (Note 11).
NOTES TO THEFINANCIAL STATEMENTS30 SEPTEMBER 2020 A N N U A L R E P O R T 2 0 2 0 / 2 0 9
30.
SEGMENT REPORTING (CONT’D)
(a)
Business segments (cont’d)
Northpoint City
North Wing
and Yishun 10
Retail Podium
$’000
Causeway
Point
$’000
Anchor-
point
$’000
YewTee
Point
$’000
Bedok
Point
$’000
Changi
City Point
$’000
Group
$’000
1,303,265
812,136 114,720 190,584 95,231
343,458 2,859,394
457,470
177,273
113,810
2,936
3,610,883
32,251
22,821
4,372
5,585
3,548
12,884
81,461
17,572
11
975
1,039,805
1,139,824
6
(16)
(133)
8
2
–
–
1,247
7
2
2
–
39
61
2
–
–
–
–
–
–
8
(16)
(147)
11
286
1,303
5
2
5
2
7
2
93
12
As at
30 September 2019
Assets and liabilities
Segment assets
Investment in associate
Investment in
joint venture
Loan to joint venture
Unallocated assets
Total assets
Segment liabilities
Unallocated liabilities
– Trade and other
payables
– Provision for taxation
– Financial derivatives
– Interest-bearing
borrowings
Total liabilities
Other segmental
information
Allowance for doubtful
receivables
Write back of allowance
for doubtful
receivables
Amortisation of lease
incentives
Depreciation of fixed
assets
Amortisation of
intangible assets
Capital expenditure
– Investment properties
– Fixed assets
3,984
10
200
–
493
6
181
–
(10)
3
165
10
5,013
29
Contents
NOTES TO THEFINANCIAL STATEMENTS30 SEPTEMBER 2020 2 1 0 / F R A S E R S C E N T R E P O I N T T R U S T
31.
COMMITMENTS
Capital expenditure contracted but not provided for
32.
CONTINGENT LIABILITY
Group and Trust
2020
$’000
2019
$’000
5,457
8,161
Pursuant to the tax transparency ruling from the IRAS, the Trustee and the Manager have provided a tax indemnity
for certain types of tax losses, including unrecovered late payment penalties, that may be suffered by the IRAS
should the IRAS fail to recover from Unitholders tax due or payable on distributions made to them without
deduction of tax, subject to the indemnity amount agreed with the IRAS. The amount of indemnity, as agreed with
the IRAS, is limited to the higher of $500,000 or 1.0% of the taxable income of the Trust each year. Each yearly
indemnity has a validity period of the earlier of seven years from the relevant year of assessment and three years
from the termination of the Trust.
33.
LEASES
Leases as lessor
The Group leases out its investment property consisting of its owned retail properties as well as leased property
(see Note 4). All leases are classified as operating leases from a lessor perspective with the exception of a sub-
lease, which the Group has classified as a finance sub-lease.
Operating lease
The Group leases out its investment properties. The Group has classified these leases as operating leases, because
they do not transfer substantially all of the risks and rewards incidental to the ownership of the assets. Portfolio
Statements set out information about the operating leases of investment property.
Rental
income from
(2019: $173,494,000).
investment properties recognised by the Group during 2020 was $147,190,000
The following table sets out a maturity analysis of lease payments, showing the undiscounted lease payments to
be received after the reporting date.
2020 – Operating leases under FRS 116
Less than one year
One to two years
Two to three years
Three to four years
Four to five years
More than five years
Total
2019 – Operating leases under FRS 17
Less than one year
Between one and five years
More than five years
Total
$’000
140,913
87,181
33,943
3,692
944
1,841
268,514
155,557
171,708
2,690
329,955
NOTES TO THEFINANCIAL STATEMENTS30 SEPTEMBER 2020 A N N U A L R E P O R T 2 0 2 0 / 2 1 1
34.
FINANCIAL RATIOS
The following financial ratios are presented as required by RAP 7:
Expenses to weighted average net assets (1):
– including performance component of asset management fees
– excluding performance component of asset management fees
Portfolio turnover rate (2)
Group
2019
%
0.88
0.54
–
2020
%
0.57
0.84
–
(1) The annualised ratios are computed in accordance with the guidelines of Investment Management Association of Singapore. The expenses used in
the computation relate to expenses of the Trust, excluding property expenses, interest expense and taxation.
(2) The annualised ratios are computed based on the lesser of purchases or sales of underlying investment properties of the Group expressed as a
percentage of daily average net asset value.
35.
SUBSEQUENT EVENTS
On 7 October and 27 October 2020, the Trust issued 244,681,000 and 324,639,666 new units at the issue price of
$2.350 per unit and $2.340 per unit via a private placement and preferential offering respectively. The aggregate
gross proceeds of $1,334.7 million have been utilised to fund the completion of acquisition of approximately
63.11% of the total issued share capital of AsiaRetail Fund Limited of $1,017,648,000 on 27 October 2020, paring
down existing indebtedness of $284,881,000 and the remaining proceeds of $32,128,000 are earmarked to pay
the estimated stamp duties, professional and other fees and expenses incurred or to be incurred by the Trust in
connection with the acquisition and the Equity Fund Raising.
On 3 November 2020, the Manager declared a distribution of $48,944,000 (or 4.372 cents per unit) to Unitholders
in respect of the period from 1 April 2020 to 30 September 2020 including release of retention of the distributable
income of the Trust for the period from 1 October 2019 to 31 March 2020.
On 5 November 2020, the Trust issued 883,069 new units issued at a price of $2.4426 per Unit as payment of
the following:-
•
•
•
•
20% of the performance fee component of its management fee for the period from 1 October 2019 to
31 December 2019;
20% of the performance fee component of its management fee for the period from 1 January 2020 to
31 March 2020;
50% of the performance fee component of its management fee for the period from 1 April 2020 to
30 June 2020; and
20% of the base fee component and performance fee component of its management fee for the period
from 1 July 2020 to 30 September 2020.
On 9 November 2020, the Trust completed divestment of Bedok Point to Chempaka Pte Ltd at $108.0 million.
On 12 November 2020, the Manager declared a DPU clean-up of $1,478,000 (or 0.132 cents per unit) to Unitholders
in respect of the period from 1 October 2020 to 6 October 2020.
Contents
NOTES TO THEFINANCIAL STATEMENTS30 SEPTEMBER 2020 2 1 2 / F R A S E R S C E N T R E P O I N T T R U S T
USE OF
PROCEEDS
Specific use of the proceeds from the private placement of 244,681,000 and preferential offering of 324,639,666 new
units in the Trust (the “Equity Fund Raising”) completed on 7 October 2020 and 27 October 2020, respectively.
Gross proceeds from the Equity Fund Raising
Use of gross proceeds to fund the purchase consideration in relation to the acquisition
of approximately 63.11% of the total issued share capital of AsiaRetail Fund Limited,
stamp duties, professional and other fees and expenses incurred in connection with
the Equity Fund Raising and the acquisition
Use of gross proceeds to pare down existing indebtedness
Balance of Proceeds
Amount
S$ million
1,334.7
(1,049.8)
(284.9)
–
The use of proceeds from the Equity Fund Raising is in accordance with the stated use of proceeds previously disclosed in
the Trust’s announcement dated 28 September 2020 in relation to, among other things, the Equity Fund Raising.
A N N U A L R E P O R T 2 0 2 0 / 2 1 3
ISSUED AND FULLY PAID-UP UNITS
There were 1,698,114,079 Units (voting rights: one vote per Unit) outstanding as at 27 November 2020.
There is only one class of Units.
The market capitalisation was approximately S$3,990 million based on closing unit price of S$2.35 on 27 November 2020.
TOP TWENTY UNITHOLDERS AS AT 27 NOVEMBER 2020
As shown in the Register of Unitholders
S/No Unitholders
FRASERS PROPERTY RETAIL TRUST HOLDINGS PTE LTD
CITIBANK NOMINEES SINGAPORE PTE LTD
HSBC (SINGAPORE) NOMINEES PTE LTD
DBS NOMINEES (PRIVATE) LIMITED
DBSN SERVICES PTE. LTD.
RAFFLES NOMINEES (PTE.) LIMITED
FRASERS CENTREPOINT ASSET MANAGEMENT LTD
BPSS NOMINEES SINGAPORE (PTE.) LTD.
DB NOMINEES (SINGAPORE) PTE LTD
CGS-CIMB SECURITIES (SINGAPORE) PTE. LTD.
OCBC SECURITIES PRIVATE LIMITED
PHILLIP SECURITIES PTE LTD
UNITED OVERSEAS BANK NOMINEES (PRIVATE) LIMITED
BNP PARIBAS NOMINEES SINGAPORE PTE. LTD.
OCBC NOMINEES SINGAPORE PRIVATE LIMITED
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
14.
15.
16. MAYBANK KIM ENG SECURITIES PTE. LTD.
UOB KAY HIAN PRIVATE LIMITED
17.
IFAST FINANCIAL PTE. LTD.
18.
CHAN WAI KHEONG
19.
ONG MIN KHIM
20.
Total
UNITHOLDINGS OF DIRECTORS OF THE MANAGER AS AT 21 OCTOBER 2020
Name of Director
Mr Christopher Tang Kok Kai
Dr Cheong Choong Kong
Mr Ho Chee Hwee Simon
Number of Units
% of Total
units in Issue
624,684,552
206,998,355
183,226,021
178,095,887
146,271,160
76,468,543
72,452,501
28,157,612
9,942,756
7,457,521
5,284,621
4,660,669
4,204,275
3,687,659
3,444,469
3,386,827
3,305,939
2,776,998
2,646,200
2,330,000
1,569,482,565
36.79
12.19
10.79
10.49
8.61
4.50
4.27
1.66
0.59
0.44
0.31
0.27
0.25
0.22
0.20
0.20
0.19
0.16
0.16
0.14
92.43
Number of FCT Units held
Direct Interest
Deemed Interest
59,000 (1)
186,597 (3)
–
792,220 (2)
–
129,000 (4)
(1)
Includes rights arising from the provisional allotment of 9,000 new Units under a non-renounceable preferential offering launched by the Manager on
9 October 2020 (the “Preferential Offering”).
(2)
Includes rights arising from the provisional allotment of 153,000 new Units under the Preferential Offering.
(3)
Includes rights arising from the provisional allotment of 41,948 new Units under the Preferential Offering.
(4)
Includes rights arising from the provisional allotment of 29,000 new Units under the Preferential Offering.
Contents
STATISTICS OFUNITHOLDINGS 2 1 4 / F R A S E R S C E N T R E P O I N T T R U S T
SUBSTANTIAL UNITHOLDERS AS AT 27 NOVEMBER 2020
Substantial Unitholders
Number of Units
% Number of Units
%
Direct Interest
Deemed Interest
Total Number
of Units Held
%
Frasers Property Retail Trust
Holdings Pte. Ltd.
Frasers Property Limited (1)
Thai Beverage Public Company
Limited (2)
International Beverage
Holdings Limited (3)
InterBev Investment Limited (4)
Siriwana Co., Ltd. (5)
Maxtop Management Corp (6)
Risen Mark Enterprise Ltd. (7)
Golden Capital (Singapore)
Limited (8)
MM Group Limited (9)
TCC Assets Limited (10)
Charoen Sirivadhanabhakdi (11)
Khunying Wanna
Sirivadhanabhakdi (12)
Notes:
624,684,552
–
36.79
–
–
697,137,053
–
41.05
624,684,552
697,137,053
36.79
41.05
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
697,137,053
41.05
697,137,053
41.05
697,137,053
697,137,053
697,137,053
697,137,053
697,137,053
697,137,053
697,137,053
697,137,053
697,137,053
41.05
41.05
41.05
41.05
41.05
41.05
41.05
41.05
41.05
697,137,053
697,137,053
697,137,053
697,137,053
697,137,053
697,137,053
697,137,053
697,137,053
697,137,053
41.05
41.05
41.05
41.05
41.05
41.05
41.05
41.05
41.05
697,137,053
41.05
697,137,053
41.05
(1) Frasers Property Limited (“FPL”) holds a 100% direct interest in each of Frasers Centrepoint Asset Management Ltd (“FCAM”) and Frasers Property Retail Trust
Holdings Pte. Ltd. (“FPRTH”); and FCAM and FPRTH hold units in FCT. FPL therefore has a deemed interest in the units in FCT in which each of FCAM and FPRTH
has an interest, by virtue of Section 4 of the Securities and Futures Act (Chapter 289 of Singapore) (the “SFA”).
(2) Thai Beverage Public Company Limited (“ThaiBev”) holds a 100% direct interest in International Beverage Holdings Limited (“IBHL”);
–
–
–
–
IBHL holds a 100% direct interest in InterBev Investment Limited (“IBIL”);
IBIL holds a greater than 20% interest in FPL;
FPL holds a 100% direct interest in each of FCAM and FPRTH; and
FCAM and FPRTH hold units in FCT.
ThaiBev therefore has a deemed interest in the units in FCT in which FPL has an interest, by virtue of the Section 4 of the SFA.
(3)
IBHL holds a 100% direct interest in IBIL;
–
–
–
IBIL holds a greater than 20% interest in FPL;
FPL holds a 100% direct interest in each of FCAM and FPRTH; and
FCAM and FPRTH hold units in FCT.
IBHL therefore has a deemed interest in the units in FCT in which FPL has an interest, by virtue of Section 4 of the SFA.
(4)
IBIL holds a greater than 20% interest in FPL;
–
–
FPL holds a 100% direct interest in each of FCAM and FPRTH; and
FCAM and FPRTH hold units in FCT.
IBIL therefore has a deemed interest in the units in FCT in which FPL has an interest, by virtue of Section 4 of the SFA.
(5) Siriwana Co., Ltd. (“SCL”) holds a greater than 20% interest in ThaiBev;
–
–
–
–
–
ThaiBev holds a 100% direct interest in IBHL;
IBHL holds a 100% direct interest in IBIL;
IBIL holds a greater than 20% interest in FPL;
FPL holds a 100% direct interest in each of FCAM and FPRTH; and
FCAM and FPRTH hold units in FCT.
SCL therefore has a deemed interest in the units in FCT in which FPL has an interest, by virtue of Section 4 of the SFA.
STATISTICS OFUNITHOLDINGS A N N U A L R E P O R T 2 0 2 0 / 2 1 5
(6) Maxtop Management Corp. (“MMC”) together with Risen Mark Enterprise Ltd. (“RM”) and Golden Capital (Singapore) Limited (“GC”) collectively holds a
greater than 20% interest in ThaiBev;
–
–
–
–
–
ThaiBev holds a 100% direct interest in IBHL;
IBHL holds a 100% direct interest in IBIL;
IBIL holds a greater than 20% interest in FPL;
FPL holds a 100% direct interest in each of FCAM and FPRTH; and
FCAM and FPRTH hold units in FCT.
MMC therefore has a deemed interest in the units in FCT in which FPL has an interest, by virtue of Section 4 of the SFA.
(7) RM together with MMC and GC collectively holds a greater than 20% interest in ThaiBev;
–
–
–
–
–
ThaiBev holds a 100% direct interest in IBHL;
IBHL holds a 100% direct interest in IBIL;
IBIL holds a greater than 20% interest in FPL;
FPL holds a 100% direct interest in each of FCAM and FPRTH; and
FCAM and FPRTH hold units in FCT.
RM therefore has a deemed interest in the units in FCT in which FPL has an interest, by virtue of Section 4 of the SFA.
(8) GC together with MMC and RM collectively holds a greater than 20% interest in ThaiBev;
–
–
–
–
–
ThaiBev holds a 100% direct interest in IBHL;
IBHL holds a 100% direct interest in IBIL;
IBIL holds a greater than 20% interest in FPL;
FPL holds a 100% direct interest in each of FCAM and FPRTH; and
FCAM and FPRTH hold units in FCT.
GC therefore has a deemed interest in the units in FCT in which FPL has an interest, by virtue of Section 4 of the SFA.
(9) MM Group Limited (“MM Group”) holds a 100% direct interest in each of MMC, RM and GC;
– MMC, RM and GC collectively holds a greater than 20% interest in ThaiBev;
–
–
–
–
–
ThaiBev holds a 100% direct interest in IBHL;
IBHL holds a 100% direct interest in IBIL;
IBIL holds a greater than 20% interest in FPL;
FPL holds a 100% direct interest in each of FCAM and FPRTH; and
FCAM and FPRTH hold units in FCT.
MM Group therefore has a deemed interest in the units in FCT in which FPL has an interest, by virtue of Section 4 of the SFA.
(10) TCC Assets Limited (“TCCA”) holds a majority interest in FPL;
–
–
FPL holds a 100% direct interest in each of FCAM and FPRTH; and
FCAM and FPRTH hold units in FCT.
TCCA therefore has a deemed interest in the units in FCT in which FPL has an interest, by virtue of Section 4 of the SFA.
(11) Charoen Sirivadhanabhakdi and his spouse, Khunying Wanna Sirivadhanabhakdi, each owns 50% of the issued and paid-up share capital of TCCA;
–
–
–
TCCA holds a majority interest in FPL;
FPL holds a 100% direct interest in each of FCAM and FPRTH; and
FCAM and FPRTH hold units in FCT.
Charoen Sirivadhanabhakdi therefore has a deemed interest in the units in FCT in which FPL has an interest, by virtue of Section 4 of the SFA.
(12) Khunying Wanna Sirivadhanabhakdi and her spouse, Charoen Sirivadhanabhakdi, each owns 50% of the issued and paid-up share capital of TCCA;
–
–
–
TCCA holds a majority interest in FPL;
FPL holds a 100% direct interest in each of FCAM and FPRTH; and
FCAM and FPRTH hold units in FCT.
Khunying Wanna Sirivadhanabhakdi therefore has a deemed interest in the units in FCT in which FPL has an interest, by virtue of Section 4 of the SFA.
Contents
STATISTICS OFUNITHOLDINGS 2 1 6 / F R A S E R S C E N T R E P O I N T T R U S T
DISTRIBUTION OF HOLDINGS
Size of Holdings
1 to 99
100 to 1,000
1,001 to 10,000
10,001 to 1,000,000
1,000,001 and above
Total
LOCATION OF UNITHOLDERS
Country
Singapore
Malaysia
Others
Total
FREE FLOAT
Number of
Unitholders
Percentage of
Unitholders (%) Number of Units
Percentage of
Units in Issue (%)
52
1,674
6,907
2,261
26
10,920
0.48
15.33
63.25
20.70
0.24
100.00
1,806
1,215,498
31,000,282
87,094,166
1,578,802,327
1,698,114,079
0.00
0.07
1.83
5.13
92.97
100.00
Number of
Unitholders
Percentage of
Unitholders (%) Number of Units
Percentage of
Units in Issue (%)
10,539
273
108
10,920
96.51
2.50
0.99
100.00
1,692,649,686
4,118,994
1,345,399
1,698,114,079
99.68
0.24
0.08
100.00
Based on information made available to the Manager as at 27 November 2020, approximately 59% of the Units are
held in the hands of the public. Rule 723 of the Listing Manual of the Singapore Exchange Securities Trading Limited has
accordingly been complied with.
STATISTICS OFUNITHOLDINGS A N N U A L R E P O R T 2 0 2 0 / 2 1 7
ADDITIONAL
INFORMATION
INTERESTED PERSON TRANSACTIONS
FOR THE FINANCIAL YEAR ENDED 30 SEPTEMBER 2020
The transactions entered into with interested persons during the financial year under review, which fall within the Listing
Manual of the Singapore Exchange Securities trading Limited (“SGX-ST”) and the Property Funds Appendix of the Code on
Collective Investment Schemes (excluding transactions of less than S$100,000 each) are as follows:
Aggregate value
of all Interested
Person Transactions
during the financial
year under
review (excluding
transactions less
than S$100,000
and transactions
conducted under
shareholders’
mandate pursuant
to Rule 920)
S$’000
Aggregate value
of all Interested
Person ransactions
during the financial
year under review
under shareholders’
mandate pursuant to
Rule 920 (excluding
transactions less
than S$100,000)
S$’000
Name of Interested Person
Nature of Relationship
Frasers Property Limited and its
subsidiaries or associates
– Asset management fees (1)
– Acquisition fees
– Property management fees (1), (2) & (3)
– Reimbursement of expenses (1), (2) & (3)
– Purchase consideration (4)
– Portfolio management fees (5)
– Car park operator fees (6)
HSBC Institutional Trust
Services (Singapore) Limited
– Trustee’s fees
(1)
Includes FCT’s interest in a joint venture.
Associates of controlling
shareholder of Manager
and controlling unitholder
of FCT
Trustee
18,430
1,972
15,231
13,735
1,100
11,200
524
577
–
–
–
–
–
–
–
–
(2) During the financial year, the property management agreement (“PMA”) with Frasers Property Retail Management Pte Ltd (the “Property Manager”) for
Changi City Point has been renewed for the period 16 June 2019 to 4 July 2021. The fees payable and expenses reimbursable to the Property Manager
pursuant to the PMA are estimated at S$6.4 million. On or six months before the expiry of the Term, the Trustee and the Manager may give written request
to the Property Manager to extend the appointment of the Property Manager for a further term of five years from the expiry of the Term. The fees payable
and expenses reimbursable to the Property Manager pursuant to the PMA for a further term of five years are estimated at S$14.8 million.
(3)
(4)
(5)
(6)
Includes FCT’s share of the property management fees payable and expenses reimbursable to Asiamalls Management Pte Ltd (“AMM”) by AsiaRetail Fund
Limited (“ARF”), which is in the proportion of its shareholding in ARF at the relevant times during the financial year ended 30 September 2020.
Includes FCT’s share of the purchase consideration received by ARF for the divestment of the entire issued share capital in AMM by ARF to the Property
Manager, which is in the proportion of its shareholding in ARF at the relevant times during the financial year ended 30 September 2020.
Includes FCT’s share of the portfolio management fees paid to Frasers Property Corporate Services (Singapore) Pte. Ltd. by ARF, which is in the proportion of
its shareholding in ARF at the relevant times during the financial year ended 30 September 2020.
Includes FCT’s share of the fees payable to the Property Manager under the car park operator agreements between the Property Manager and Changi City
Carpark Operations LLP in respect of the operation, management and maintenance of the car park at Changi City, which is in the proportion of its partnership
interest in Changi City Carpark Operations LLP.
Saved as disclosed above, there were no additional interested person transactions (excluding transactions of less than
S$100,000 each) entered into during the financial year under review nor any material contracts entered into by the Trust
that involved the interests of the CEO, any Director or any controlling unitholder of the Trust.
Please refer to Note 27 Significant Related Party Transactions to the Financial Statements on page 198.
Fees payable to the Manager and the Property Manager on the basis of, and in accordance with, the terms and conditions
set out in the Trust deed dated 5 June 2006 (as amended) and/or the prospectus dated 27 June 2006 are not subject
to Rules 905 and 906 of the SGX-ST’s Listing Manual. Accordingly, such fees are not subject to aggregation and other
requirements under Rules 905 and 906 of the SGX-ST’s Listing Manual.
Contents
2 1 8 / F R A S E R S C E N T R E P O I N T T R U S T
ADDITIONAL
INFORMATION
INTERESTED PERSON TRANSACTIONS
FOR THE FINANCIAL YEAR ENDED 30 SEPTEMBER 2020
Manager’s Asset Management and Acquisition Fees Paid and Payable in Units
A summary of Units issued for payment of the Manager’s management fees and acquisition fees in respect of the financial
year are as follows:-
Manager’s Base Fee Component
1 October to December 2019
1 January to 31 March 2020
1 April to 30 June 2020
1 July to 30 September 2020
Issue Date
Units Issued
Issue Price (1)
24 January 2020
24 April 2020
27 July 2020
5 November 2020
213,085
287,504
610,427
255,647
S$2.7439 (1)
S$2.0625 (1)
S$2.3984 (1)
S$2.4426 (1)
Manager’s Performance Fee Component
1 October 2019 to 30 September 2020
5 November 2020
627,422
S$2.4426 (1)
Acquisition Fee
In respect of acquisition by FCT Holdings (Sigma) Pte. Ltd,
a wholly-owned subsidiary of FCT, of approximately
12.07% interest in AsiaRetail Fund Limited on 6 July 2020
11 August 2020
827,060
S$2.3848 (2)
(1) Based on the volume weighted average traded price of a Unit in the ordinary course of trading on the SGX-ST for the last 10 business days of the relevant
period in which the management fees were accrued
(2) Based on the volume weighted average traded price of a Unit in the ordinary course of trading on the SGX-ST for the last 10 business days immediately
preceding the date of issue of the Units
SUBSCRIPTION OF THE TRUST UNITS
For the financial year ended 30 September 2020, an aggregate of 3,163,084 Units were issued and as at 30 September
2020, 1,119,447,127 Units were in issue. On 7 October and 27 October 2020, the Trust issued 244,681,000 new Units
at the issue price of S$2.350 per new Unit and 324,639,666 new Units at the issue price of S$2.340 per new Unit via a
private placement and preferential offering respectively. On 5 November 2020, the Trust issued 883,069 new Units to the
Manager as payment of the base fee component of the Manager’s management fees for the quarter ended 30 September
2020 and payment of the performance fee component of the Manager’s management fees for the financial year ended
30 September 2020. On 27 November 2020, the Trust issued 8,231,488 new Units as payment of the acquisition fee
of S$19,343,997.43 in connection with the acquisition of approximately 63.11% of the total issued share capital of
AsiaRetail Fund Limited and 231,729 new Units as payment of the divestment fee of S$540,000.00 in connection with
the divestment of a leasehold interest in the whole of the land lots 4710W, 4711V, 10529L and 10530N all of Mukim
27 together with the building erected thereon, situated at 799 New Upper Changi Road, Singapore 467351, currently
known as Bedok Point at an issue price of S$2.3500 per new Unit and S$2.3303 per new Unit respectively.
NON-DEAL ROADSHOW EXPENSES
Non-deal roadshow expenses of S$7,420 (2019: S$33,645) were incurred during the year ended 30 September 2020.
A N N U A L R E P O R T 2 0 2 0 / 2 1 9
(CONSTITUTED IN THE REPUBLIC OF SINGAPORE PURSUANT TO A TRUST DEED DATED 5 JUNE 2006
(AS AMENDED AND RESTATED))
NOTICE IS HEREBY GIVEN that the 12th Annual General Meeting (the “AGM”) of the unitholders of FRASERS CENTREPOINT
TRUST (“FCT”, and the unitholders of FCT, “Unitholders”) will be held by way of electronic means on 21 January 2021 at
10.00 a.m. for the following purposes:
ROUTINE BUSINESS
Resolution (1)
1.
To receive and adopt the Report of the Trustee issued by HSBC Institutional Trust Services (Singapore) Limited, as
trustee of FCT (the “Trustee”), the Statement by the Manager issued by Frasers Centrepoint Asset Management
Ltd., as manager of FCT (the “Manager”) and the Audited Financial Statements of FCT for the financial year ended
30 September 2020.
Resolution (2)
2.
To re-appoint KPMG LLP (“KPMG”) as Auditors of FCT to hold office until the conclusion of the next Annual General
Meeting of FCT, and to authorise the Manager to fix their remuneration.
SPECIAL BUSINESS
To consider and, if thought fit, to pass the following Ordinary Resolution, with or without any modifications:
Resolution (3)
3.
That authority be and is hereby given to the Manager, to:
(a)
(i)
issue units in FCT (“Units”) whether by way of rights, bonus or otherwise; and/or
(ii)
make or grant offers, agreements or options (collectively, “Instruments”) that might or would require
Units to be issued, including but not limited to the creation and issue of (as well as adjustments to)
securities, warrants, debentures or other instruments convertible into Units,
at any time and upon such terms and conditions and for such purposes and to such persons as the Manager
may in its absolute discretion deem fit; and
(b)
issue Units in pursuance of any Instrument made or granted by the Manager while this Resolution was in
force (notwithstanding that the authority conferred by this Resolution may have ceased to be in force at
the time such Units are issued),
provided that:
(1)
the aggregate number of Units to be issued pursuant to this Resolution (including Units to be issued in pursuance
of Instruments made or granted pursuant to this Resolution) shall not exceed fifty per cent. (50%) of the total
number of issued Units (excluding treasury Units, if any) (as calculated in accordance with sub-paragraph (2)
below), of which the aggregate number of Units to be issued other than on a pro rata basis to Unitholders shall not
exceed twenty per cent. (20%) of the total number of issued Units (excluding treasury Units, if any) (as calculated
in accordance with sub-paragraph (2) below);
Contents
NOTICE OFANNUAL GENERAL MEETING 2 2 0 / F R A S E R S C E N T R E P O I N T T R U S T
(2)
subject to such manner of calculation as may be prescribed by Singapore Exchange Securities Trading Limited (the
“SGX-ST”) for the purpose of determining the aggregate number of Units that may be issued under sub-paragraph
(1) above, the total number of issued Units (excluding treasury Units, if any) shall be based on the number of issued
Units (excluding treasury Units, if any) at the time this Resolution is passed, after adjusting for:
(a)
any new Units arising from the conversion or exercise of any Instruments which are outstanding at the time
this Resolution is passed; and
(b)
any subsequent bonus issue, consolidation or subdivision of Units;
(3)
(4)
(5)
(6)
in exercising the authority conferred by this Resolution, the Manager shall comply with the provisions of the
Listing Manual of the SGX-ST for the time being in force (unless such compliance has been waived by the SGX-ST)
and the deed of trust constituting FCT (as amended and restated) (the “Trust Deed”) for the time being in force
(unless otherwise exempted or waived by the Monetary Authority of Singapore);
unless revoked or varied by Unitholders in a general meeting, the authority conferred by this Resolution shall
continue in force until (i) the conclusion of the next Annual General Meeting of FCT or (ii) the date by which the
next Annual General Meeting of FCT is required by applicable law or regulations to be held, whichever is earlier;
where the terms of the issue of the Instruments provide for adjustment to the number of Instruments or Units
into which the Instruments may be converted in the event of rights, bonus or other capitalisation issues or any
other events, the Manager is authorised to issue additional Instruments or Units pursuant to such adjustment
notwithstanding that the authority conferred by this Resolution may have ceased to be in force at the time the
Instruments or Units are issued; and
the Manager, any director of the Manager (“Director”) and the Trustee, be and are hereby severally authorised
to complete and do all such acts and things (including executing all such documents as may be required) as the
Manager, such Director, or, as the case may be, the Trustee may consider expedient or necessary or in the interest
of FCT to give effect to the authority conferred by this Resolution.
Frasers Centrepoint Asset Management Ltd.
(Company Registration No: 200601347G)
As manager of Frasers Centrepoint Trust
Catherine Yeo
Company Secretary
Singapore, 29 December 2020
NOTICE OFANNUAL GENERAL MEETING A N N U A L R E P O R T 2 0 2 0 / 2 2 1
NOTES:
(1)
(2)
(3)
The AGM is being convened, and will be held, by electronic means pursuant to the COVID-19 (Temporary Measures)
(Alternative Arrangements for Meetings for Companies, Variable Capital Companies, Business Trusts, Unit Trusts
and Debenture Holders) Order 2020. Printed copies of this Notice will sent to Unitholders and will also be made
available via publication on FCT’s website at the URL https://www.frasersproperty.com/reits/fct and will also be
made available on the SGX website at the URL https://www.sgx.com/securities/company-announcements.
Due to the current COVID-19 restriction orders in Singapore, a Unitholder will not be able to attend the AGM
in person. Alternative arrangements relating to the attendance at the AGM via electronic means (including
arrangements by which the AGM can be electronically accessed via live audio-visual webcast or live audio-only
streaming), submission of questions to the Chairman of the AGM in advance of the AGM, addressing of substantial
and relevant questions at the AGM and voting by appointing the Chairman of the AGM as proxy at the AGM, are as
set out below.
Unitholders will be able to observe and/or listen to the AGM proceedings through a live audio-visual webcast or
live audio-only stream via their mobile phones, tablets or computers. In order to do so, Unitholders must register
at FCT’s pre-registration website accessible at the URL https://www.frasersproperty.com/reits/fct from now till
10.00 a.m. on 18 January 2021 to enable the Manager to verify their status as Unitholders.
Following the verification, authenticated Unitholders will each receive an email, which will contain a user ID
and password details as well as instructions on how to access the live audio-visual webcast and live audio-only
stream of the AGM proceedings, by 10.00 a.m. on 20 January 2021. Unitholders who do not receive an email by
10.00 a.m. on 20 January 2021 but have registered by 10.00 a.m. on 18 January 2021 should contact the Unit
Registrar, Boardroom Corporate & Advisory Services Pte. Ltd., at +65 6536 5355 (during office hours) or by email
to FCTagm2021@boardroomlimited.com.
(4)
Unitholders may also submit questions related to the resolutions to be tabled for approval at the AGM to the
Chairman of the AGM, in advance of the AGM. In order to do so, their questions must be submitted in the following
manner by 10.00 a.m. on 18 January 2021:
(a)
via FCT’s pre-registration website at https://www.frasersproperty.com/reits/fct; or
(b)
via email to the Manager, at ir@fraserscentrepointtrust.com; or
(c)
if submitted by post, be deposited at the office of the Unit Registrar, Boardroom Corporate & Advisory
Services Pte. Ltd., at 50 Raffles Place, #32-01 Singapore Land Tower, Singapore 048623.
Unitholders who submit questions by email or by post must provide the following information:
(i)
the Unitholder’s full name;
(ii)
the Unitholder’s address; and
(iii)
the manner in which the Unitholder holds Units in FCT (e.g., via CDP, CPF or SRS).
The Manager will address all the substantial and relevant questions received at least 72 hours before the AGM
prior to or during the AGM. The Manager will publish the responses to the substantial and relevant questions
which the Manager is unable to address during the AGM, on FCT’s website and on SGXNET prior to the AGM. The
Manager will publish the minutes of the AGM on FCT’s website and on SGXNET, and the minutes will include the
responses to the substantial and relevant questions which are addressed during the AGM. Unitholders will not
be able to ask questions at the AGM live during the audio-visual webcast or audio-stream, and therefore it is
important for Unitholders who wish to ask questions to submit their questions in advance of the AGM.
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NOTICE OFANNUAL GENERAL MEETING 2 2 2 / F R A S E R S C E N T R E P O I N T T R U S T
(5)
If a Unitholder (whether individual or corporate) wishes to exercise his/her/its voting rights at the AGM, he/she/it must
appoint the Chairman of the AGM as his/her/its proxy to attend, speak and vote on his/her/its behalf at the AGM. In
addition to the printed copies of the Proxy Form for the AGM which will be sent to Unitholders, the Proxy Form is
available on FCT’s website and at the website of SGX-ST at the URLs https://www.frasersproperty.com/reits/fct and
https://www.sgx.com/securities/company-announcements respectively. Additional printed copies of the Proxy Form,
if required, can be requested from the Unit Registrar, Boardroom Corporate & Advisory Services Pte. Ltd. by calling +65
6536 5355. Requests for printed copies of the Proxy Form should be made by 13 January 2021.
In appointing the Chairman of the AGM as proxy, a Unitholder must give specific instructions as to voting,
or abstentions from voting, in respect of a resolution in the Proxy Form, failing which the appointment of the
Chairman of the AGM as proxy for that resolution will be treated as invalid.
(6)
The Proxy Form must be submitted to the Manager c/o the Unit Registrar, Boardroom Corporate & Advisory
Services Pte. Ltd., in the following manner:
(a)
(b)
if submitted by post, be lodged at the office of the Unit Registrar at 50 Raffles Place, #32-01 Singapore Land
Tower, Singapore 048623; or
submitted
if
be
FCTagm2021@boardroomlimited.com,
electronically,
submitted
via
email
to
the Unit
Registrar
at
in either case, by 10.00 a.m. on 18 January 2021, being 72 hours before the time fixed for the AGM.
A Unitholder who wishes to submit a Proxy Form must first complete and sign the Proxy Form, before submitting
it by post to the address provided above, or before scanning and sending it by email to the email address
provided above.
In view of the COVID-19 restriction orders in Singapore and the related safe distancing measures which may
make it difficult for Unitholders to submit completed Proxy Forms by post, Unitholders are strongly encouraged
to submit completed Proxy Forms electronically via email.
(7)
Persons who hold Units through relevant intermediaries (as defined below), and who wish to participate in the
AGM by (a) observing and/or listening to the AGM proceedings through live audio-visual webcast or live audio-only
stream; (b) submitting questions in advance of the AGM; and/or (c) appointing the Chairman of the AGM as proxy
to attend, speak and vote on their behalf at the AGM, should contact the relevant intermediary through which
they hold such Units as soon as possible in order to make the necessary arrangements for them to participate in
the AGM.
For the avoidance of doubt, CPF and SRS Investors who wish to participate in the AGM by (a) observing and/
or listening to the AGM proceedings through live audio-visual webcast or live audio-only stream and/or (b)
submitting questions in advance of the AGM should refer to paragraphs 3 and 4 above respectively. However, CPF
and SRS investors who wish to appoint the Chairman of the AGM as proxy should approach their respective CPF
Agent Banks or SRS Operators to submit their votes by 5.00 p.m. on 12 January 2021, being seven (7) working days
before the date of the AGM.
NOTICE OFANNUAL GENERAL MEETING A N N U A L R E P O R T 2 0 2 0 / 2 2 3
“relevant intermediary” means:
(a)
(b)
(c)
a banking corporation licensed under the Banking Act, Chapter 19 of Singapore or a wholly-owned
subsidiary of such a banking corporation, whose business includes the provision of nominee services and
who holds Units in that capacity;
a person holding a capital markets services licence to provide custodial services for securities under the
Securities and Futures Act, Chapter 289 of Singapore and who holds Units in that capacity; or
the Central Provident Fund Board (“CPF Board”) established by the Central Provident Fund Act, Chapter 36
of Singapore, in respect of Units purchased under the subsidiary legislation made under that Act providing
for the making of investments from the contributions and interest standing to the credit of members of the
Central Provident Fund, if the CPF Board holds those Units in the capacity of an intermediary pursuant to or
in accordance with that subsidiary legislation.
(8)
The Chairman of the AGM, as proxy, need not be a Unitholder of FCT.
(9)
The Annual Report for the financial year ended 30 September 2020 may be accessed at FCT’s website at the URL
https://www.frasersproperty.com/reits/fct.
(10) Due to the constantly evolving COVID-19 situation in Singapore, the Manager may be required to change
the arrangements for the AGM at short notice. Unitholders should check FCT’s website at the URL
https://www.frasersproperty.com/reits/fct for the latest updates on the status of the AGM.
EXPLANATORY NOTE:
Resolution 3
The Ordinary Resolution 3 above, if passed, will empower the Manager from the date of this AGM until the earliest of (i)
the conclusion of the next AGM of FCT or (ii) the date by which the next AGM of FCT is required by the applicable laws and
regulations or the Trust Deed to be held, whichever is earlier, or (iii) the date on which such authority is revoked or varied
by the Unitholders in a general meeting, to issue Units and to make or grant instruments (such as securities, warrants or
debentures) convertible into Units and issue Units pursuant to such instruments, up to a number not exceeding 50% of
the total number of issued Units (excluding treasury Units, if any), with a sub-limit of 20% for issues other than on a pro
rata basis to Unitholders.
For the purpose of determining the aggregate number of Units that may be issued, the percentage of issued Units will be
calculated based on the total number of issued Units at the time Ordinary Resolution 3 above is passed, after adjusting for
new Units arising from the conversion or exercise of any Instruments which are outstanding at the time this Resolution
is passed and any subsequent bonus issue, consolidation or subdivision of Units.
Fund raising by issuance of new Units may be required in instances of property acquisitions or debt repayments. In
any event, if the approval of Unitholders is required under the Listing Manual of the SGX-ST and the Trust Deed or any
applicable laws and regulations in such instances, the Manager will then obtain the approval of Unitholders accordingly.
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NOTICE OFANNUAL GENERAL MEETING 2 2 4 / F R A S E R S C E N T R E P O I N T T R U S T
PERSONAL DATA PRIVACY:
By submitting an instrument appointing the Chairman of the AGM as proxy to attend, speak and vote at the AGM and/or
any adjournment thereof, a Unitholder consents to the collection, use and disclosure of the Unitholder’s personal data by
the Manager and the Trustee (or their agents or service providers) for the purpose of the processing and administration
by the Manager and the Trustee (or their agents or service providers) of the appointment of the Chairman of the AGM
as proxy for the AGM (including any adjournment thereof) and the preparation and compilation of the attendance lists,
minutes and other documents relating to the AGM (including any adjournment thereof), and in order for the Manager
and the Trustee (or their agents or service providers) to comply with any applicable laws, listing rules, regulations and/
or guidelines.
Important Notice
The value of Units and the income derived from them, if any, may fall or rise. Units are not obligations of, deposits in,
or guaranteed by, the Manager or any of its affiliates. An investment in Units is subject to investment risks, including
the possible loss of the principal amount invested.
Investors should note that they have no right to request the Manager to redeem or purchase their Units for so long as
the Units are listed on the SGX-ST. It is intended that Unitholders may only deal in their Units through trading on the
SGX-ST. The listing of the Units on the SGX-ST does not guarantee a liquid market for the Units.
The past performance of FCT is not necessarily indicative of the future performance of FCT.
NOTICE OFANNUAL GENERAL MEETING This page has been intentionally left blank.
This page has been intentionally left blank.
FRASERS CENTREPOINT TRUST
(CONSTITUTED IN THE REPUBLIC OF SINGAPORE
PURSUANT TO A TRUST DEED DATED 5 JUNE 2006
(AS AMENDED, RESTATED AND SUPPLEMENTED))
PROXY FORM
ANNUAL GENERAL MEETING
NOTE: This Proxy Form may be accessed at Frasers Centrepoint Trust’s
website at https://www.frasersproperty.com/reits/fct, and will be
made available on the website of the SGX-ST at https://www.sgx.com/
securities/company-announcements. Additional printed copies of the Proxy
Form, if required, can be requested from Boardroom Corporate & Advisory
Services Pte. Ltd. by calling +65 6536 5355. Requests for printed copies of the
Proxy Form should be made by 13 January 2021.
Personal Data Privacy
By submitting an instrument appointing the Chairman of the AGM (as defined
below) as proxy, the unitholder accepts and agrees to the personal data
privacy terms set out in the Notice of AGM dated 29 December 2020.
IMPORTANT:
1. The AGM is being convened, and will be held, by way of electronic means pursuant to the COVID-19 (Temporary Measures) (Alternative Arrangements for
Meetings for Companies, Variable Capital Companies, Business Trusts, Unit Trusts and Debenture Holders) Order 2020. In addition to the printed copies
of the Notice of AGM dated 29 December 2020 which will be sent to unitholders, the Notice of AGM will also be available through electronic means via
publication on Frasers Centrepoint Trust’s website at https://www.frasersproperty.com/reits/fct, and will also be made available on the website of the
SGX-ST at https://www.sgx.com/securities/company-announcements.
2. Alternative arrangements relating to attendance at the AGM via electronic means (including arrangements by which the meeting can be electronically
accessed via live audio-visual webcast or live audio-only stream), submission of questions to the Chairman of the AGM in advance of the AGM, addressing
of substantial and relevant questions either before or at the AGM and voting by appointing the Chairman of the AGM as proxy at the AGM, are set out in the
Notice of AGM.
3. Due to the current COVID-19 restriction orders in Singapore, a unitholder will not be able to attend the AGM in person. If a unitholder (whether
individual or corporate) wishes to exercise his/her/its voting rights at the AGM, he/she/it must appoint the Chairman of the AGM as his/her/its proxy to
attend, speak and vote on his/her/its behalf at the AGM.
4.
If a CPF or SRS investor wishes to appoint the Chairman of the AGM as proxy, he/she should approach his/her respective CPF Agent Banks or SRS Operators
to submit his/her votes by 5.00 p.m. on 12 January 2021, being 7 working days before the date of the AGM.
5. Please read the notes overleaf which contain instructions on, inter alia, the appointment of the Chairman of the AGM as a unitholder’s proxy to attend,
speak and vote on his/her/its behalf at the AGM.
(Name(s) and NRIC No./Passport
l/We
No./Company Registration No.) of
(Address)
being a unitholder / unitholders of Frasers Centrepoint Trust (“FCT”), hereby appoint the Chairman of the AGM as my/our
proxy to attend, speak and vote for me/us on my/our behalf at the Annual General Meeting (the “AGM”) of FCT to be convened
and held by way of electronic means on Thursday, 21 January 2021 at 10.00 a.m. and at any adjournment thereof.
I/We direct the Chairman of the AGM as my/our proxy to vote for or against, or to abstain from voting on, the resolutions
to be proposed at the AGM as indicated hereunder.
No. of Votes
For*
No. of Votes
Against*
No. of Votes to
Abstain*
No. Resolutions
1.
2.
3.
ROUTINE BUSINESS
To receive and adopt the Trustee’s Report, the Statement by
the Manager, the Audited Financial Statements of FCT for the
financial year ended 30 September 2020 and the Auditor’s
Report thereon
To re-appoint KPMG LLP as Auditors of FCT to hold office until
the conclusion of the next Annual General Meeting, and to
authorise the Manager to fix their remuneration
SPECIAL BUSINESS
To authorise the Manager to issue Units and to make or grant
convertible instruments
*
Voting will be conducted by poll. If you wish the Chairman of the AGM as your proxy to cast all your votes “For” or “Against” a resolution, please indicate with
a “√” in the space provided under “For” or “Against”. If you wish the Chairman of the AGM as your proxy to abstain from voting on a resolution, please indicate
a “√” in the space provided under “Abstain”. Alternatively, please indicate the number of units that the Chairman of the AGM as your proxy is directed to vote
“For” or “Against” or to abstain from voting. In the absence of specific directions in respect of a resolution, the appointment of the Chairman of the AGM as
your proxy for that resolution will be treated as invalid.
Dated this
day of
2020/2021 (delete as appropriate)
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Signature(s) of Unitholder(s) or
Common Seal of Corporate Unitholder
Email Address of Unitholder(s) (optional):
IMPORTANT: PLEASE READ NOTES ON THE REVERSE SIDE
Fold here, do not staple. Glue all sides firmly.
Notes:
1. Due to the current COVID-19 restriction orders in Singapore, a unitholder will not be able to attend the AGM in person. If a unitholder (whether individual or
corporate) wishes to exercise his/her/its voting rights at the AGM, he/she/it must appoint the Chairman of the AGM as his/her/its proxy to attend, speak and vote on
his/her/its behalf at the AGM. This Proxy Form is available on FCT’s website and on the website of the SGX-ST at the URLs https://www.frasersproperty.com/reits/fct,
and https://www.sgx.com/securities/company-announcements respectively. In appointing the Chairman of the AGM as proxy, a unitholder must give specific
instructions as to voting, or abstention from voting, in respect of a resolution in the Proxy Form, failing which the appointment of the Chairman of the AGM as
proxy for that resolution will be treated as invalid.
2. CPF or SRS investors who wish to appoint the Chairman of the AGM as proxy should approach their respective CPF Agent Banks or SRS Operators to submit their
votes by 5.00 p.m. on 12 January 2021, being 7 working days before the date of the AGM.
3. The Chairman of the AGM, as proxy, need not be a unitholder of FCT.
4. A unitholder should insert the total number of units held. If the unitholder has units entered against the unitholder’s name in the Depository Register maintained
by The Central Depository (Pte) Limited, the unitholder should insert that number of units. If the unitholder has units registered in the unitholder’s name in the
Register of Unitholders of FCT, the unitholder should insert that number of units. If the unitholder has units entered against the unitholder’s name in the said
Depository Register and registered in the unitholder’s name in the Register of Unitholders of FCT, the unitholder should insert the aggregate number of units. If
no number is inserted, this Proxy Form will be deemed to relate to all the units held by the unitholder.
5. The Proxy Form must be submitted to the Manager c/o FCT’s Unit Registrar, Boardroom Corporate & Advisory Services Pte. Ltd., in the following manner:
(a)
if submitted by post, be lodged at the office of FCT’s Unit Registrar, Boardroom Corporate & Advisory Services Pte. Ltd. at 50 Raffles Place, #32-01 Singapore
Land Tower, Singapore 048623; or
(b)
if submitted electronically, be submitted via email to FCT’s Unit Registrar at FCTagm2021@boardroomlimited.com,
in either case, by 10.00 a.m. on 18 January 2021, being 72 hours before the time fixed for the AGM.
A unitholder who wishes to submit the Proxy Form must first complete and sign the Proxy Form, before submitting it by post to the address provided above, or
before scanning and sending it by email to the email address provided above.
In view of the COVID-19 restriction orders in Singapore and the related safe distancing measures which may make it difficult for unitholders to submit
completed Proxy Forms by post, unitholders are strongly encouraged to submit completed Proxy Forms electronically via email.
6. The Proxy Form must be executed under the hand of the appointor or of his/her attorney duly authorised in writing. Where the Proxy Form is executed by a
corporation, it must be executed either under its common seal or under the hand of its attorney or a duly authorised officer.
7. Where the Proxy Form is signed on behalf of the appointor by an attorney or a duly authorised officer, the power of attorney or other authority (if any) under
which it is signed or a duly certified copy of such power or authority must (failing previous registration with the Manager) if the Proxy Form is submitted by post,
be lodged with the Proxy Form, or, if the Proxy Form is submitted electronically via email, be emailed with the Proxy Form, failing which the Proxy Form may be
treated as invalid.
8. Any reference to a time of day is made by reference to Singapore time.
General
The Manager shall be entitled to reject a Proxy Form which is incomplete, improperly completed or illegible or where the true intentions of the appointor are not
ascertainable from the instructions of the appointor specified on the Proxy Form. In addition, in the case of units entered in the Depository Register, the Manager may
reject a Proxy Form if the unitholder, being the appointor, is not shown to have units entered against his/her name in the Depository Register as at 72 hours before the
time appointed for holding the AGM, as certified by CDP to the Manager.
Fold here
Postage will
be paid by
addressee. For
posting in
Singapore
only.
The Company Secretary
Frasers Centrepoint Asset Management Ltd.
(as Manager of Frasers Centrepoint Trust)
c/o Boardroom Corporate & Advisory Services Pte Ltd
50 Raffles Place #32-01
Singapore Land Tower
Singapore 048623
CORPORATE
INFORMATION1
FRASERS CENTREPOINT TRUST
Trustee’s Registered Address
HSBC Institutional Trust Services (Singapore) Limited
10 Marina Boulevard
Marina Bay Financial Centre Tower 2 #48-01
Singapore 0189832
TRUSTEE’S MAILING ADDRESS
HSBC Institutional Trust Services (Singapore) Limited
10 Marina Boulevard
Marina Bay Financial Centre Tower 2 #45-01
Singapore 0189833
AUDITOR
KPMG LLP
16 Raffles Quay, #22-00 Hong Leong Building
Singapore 048581
Partner-in-charge: Ms Karen Lee Shu Pei
Appointed 21 January 2016
Phone: (65) 6213 3388
Fax: (65) 6225 0984
Website address: www.kpmg.com.sg
BANKERS
BNP Paribas
Crédit Industriel et Commercial
Citibank N.A.
DBS Bank Ltd
Oversea-Chinese Banking Corporation Ltd
Standard Chartered Bank
UNIT REGISTRAR
Boardroom Corporate & Advisory Services Pte Ltd
50 Raffles Place, #32-01 Singapore Land Tower
Singapore 048623
Phone: (65) 6536 5355
Fax: (65) 6536 1360
THE MANAGER
Registered Address
Frasers Centrepoint Asset Management Ltd
438 Alexandra Road, #21-00 Alexandra Point
Singapore 119958
Phone: (65) 6276 4882
Fax: (65) 6272 8776
Website: www.frasersproperty.com/reits/fct
DIRECTORS OF THE MANAGER4
Dr Cheong Choong Kong (Chairman)
Non-Executive and Independent Director
Mr Ho Chai Seng
Non-Executive and Independent Director
Mr Ho Chee Hwee Simon5
Non-Executive and Non-Independent Director
Ms Koh Choon Fah6
Non-Executive and Independent Director
Mr Low Chee Wah7
Non-Executive and Non-Independent Director
Mr Christopher Tang Kok Kai
Non-Executive and Non-Independent Director
AUDIT, RISK AND COMPLIANCE COMMITTEE
Ms Koh Choon Fah (Chairman)6
Dr Cheong Choong Kong
Mr Ho Chai Seng
Mr Ho Chee Hwee, Simon5
NOMINATING AND REMUNERATION COMMITTEE
Mr Ho Chai Seng (Chairman)
Dr Cheong Choong Kong
Ms Koh Choon Fah
Mr Ho Chee Hwee Simon
Mr Christopher Tang Kok Kai
COMPANY SECRETARY
Ms Catherine Yeo
1 Unless otherwise stated, the information herein is as of 30 September 2020.
2 With effect from 16 March 2020.
3 With effect from 6 April 2020.
4 Mr Philip Eng Heng Nee retired as Non-Executive and Non-Independent Director of the Manager and a member of the Audit, Risk and Compliance
Committee (“ARCC”) on 3 January 2020.
5 Mr Ho Chee Hwee Simon served as the chairman of the ARCC until 1 November 2019. Mr Ho Chee Hwee Simon relinquished his role as the chairman of the
ARCC and remains as a Non-executive and Non-Independent Director of the Manager and a member of the ARCC and the Nominating and Remuneration
Committee (“NRC”).
6 Ms Koh Choon Fah was appointed as a Non-Executive and Independent Director of the Manager, a member of the ARCC and a member of the NRC. Ms Koh
Choon Fah was appointed as the chairman of the ARCC with effect from 1 November 2019.
7 Mr Low Chee Wah was appointed as a Non-Executive and Non-Independent Director of the Manager on 3 January 2020.
FRASERS CENTREPOINT ASSET MANAGEMENT LTD.
As Manager of Frasers Centrepoint Trust
Company Registration Number: 200601347G
438 Alexandra Road
#21-00 Alexandra Point
Singapore 119958
Phone: +65 6276 4882
+65 6272 8776
Fax:
ir@fraserscentrepointtrust.com
Email:
www.frasersproperty.com/reits/fct