Singapore Exchange Ltd (SGX)

Singapore Exchange is Asia’s leading and trusted market infrastructure, facilitating the exchange of capital and ideas to create value for people, businesses and economies. As a multi-asset exchange operating equity, fixed income and derivatives markets to the highest regulatory standards, SGX is a vertically integrated business that provides listing, trading, clearing, settlement, depository and data services.

With about 40% of listed companies and over 80% of listed bonds originating outside of Singapore as well as established linkages across the region and in Europe, SGX is Asia’s most international and connected exchange. Offering a full suite of derivatives products across Asian equity indices, commodities and currencies, SGX is the world’s most liquid international market for the benchmark equity indices of China, India, Japan and ASEAN.

As Asia’s pioneering central counterparty, SGX is globally recognised for its risk management and clearing capabilities, and was one of the first globally to adopt the Principles for Financial Market Infrastructure.

Headquartered in AAA-rated Singapore, SGX has over 800 employees including offices in Beijing, Chicago, Hong Kong, London, New York, Mumbai, San Francisco, Shanghai and Tokyo.

Asia’s leading multi-asset exchange

SGX Market Strategist, Equity & Fixed Income, Singapore Exchange Ltd (SGX)

Geoff Howie

SGX Market Strategist, Equity & Fixed Income

Equity Bottom-Up

Frasers Logistics & Commercial Trust / Equity Bottom-Up

Frasers Logistics & Commercial Trust (FLT SP)

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 <div class='content-caption'>Robert Wallace</div>
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Property veteran Robert Wallace dreams boldly, with both feet firmly planted on the ground.

“For me, it’s all about setting realistic, but ambitious, goals, and delivering on them,” said the Chief Executive Officer of the manager of SGX-listed Frasers Logistics &amp; Commercial Trust (FLCT), which was created by the S$6.0 billion merger between Frasers Logistics &amp; Industrial Trust (FLT) and Frasers Commercial Trust (FCOT) earlier this year.

“In whatever I do, I make sure I deliver on my promises – I guess you could describe me as dependable,” he smiled.

Wallace, who holds a Bachelor of Business (Property) from RMIT University and a Postgraduate Diploma in Applied Finance and Investment from Financial Services Institute of Australasia, began his career as a property valuer in Melbourne.

American author Mark Twain once famously wrote: “Find a job you enjoy doing, and you will never have to work a day in your life”, and Wallace is living proof of that.

“This is one mantra I stand by – I wanted to do something that I would enjoy, something tangible and concrete, so I chose real estate,” he said.

“You can easily achieve successful results with property once you understand the dynamics involved,” he added. “For every piece of real estate, there is a formula behind it. Once you understand that formula, in terms of its drivers and markets, you can always add value.”

Wallace has been CEO of the manager of FLCT since the trust’s listing on SGX in 2016. Before this appointment, the 49-year-old held senior management roles in Frasers Property Australia, formerly known as Australand Property Group. In the early 2000s, he was a Fund Manager at MAB Funds Management. Prior to that, he worked in advisory positions in Jones Lang LaSalle and Charter Keck Cramer.

The merger between Frasers's logistics and commercial REITs to form FLCT, proposed last December by way of a trust scheme of arrangement, was completed in April.

FLCT now has a mandate to principally invest in a portfolio of income-producing real estate used predominantly for logistics or industrial purposes, located globally, and/or commercial purposes or business park purposes, located in the Asia-Pacific region or Europe.

Its portfolio comprises 100 industrial and commercial properties, diversified across five major developed countries – Australia, Germany, Singapore, the UK and the Netherlands.

 

Opportunistic Focus

 

The REIT’s Sponsor is Mainboard-listed Frasers Property, a multinational owner-operator-developer of real estate products and services with total assets of about S$38.7 billion as at 30 September 2020. Its businesses span five asset classes – residential, retail, commercial &amp; business parks, industrial &amp; logistics, as well as hospitality.

The Sponsor has operations in Southeast Asia, Australia, Europe and China, and its well-established hospitality business owns and/or operates serviced apartments and hotels in more than 70 cities and 20 countries across Asia, Australia, Europe, the Middle East and Africa.

Expanding in the markets FLCT already has a presence in, as well as leveraging on its Sponsor’s right-of-first-refusal (ROFR) pipeline, will drive the REIT’s medium- to longer-term growth, Wallace noted.

“We’ll take advantage of our strong presence on the ground, as there are plenty of opportunities in our existing markets. We’re now of a sufficient size to hold developmental assets and enjoy the enhanced returns that such assets will bring.”

Strategic and accretive acquisitions are also on the cards. “We’re looking to buy from a medium- to long-term perspective, not just short-term,” Wallace noted.

“What we tend to do is grade all of our assets – we have about 100 properties within our portfolio – and for any new asset that we look at, hopefully we can put it in the top at least 25% of our portfolio in terms of returns to justify why we would acquire it,” he added.

FLCT applies the same rigour to its divestments. “We’re a reasonably active manager of our portfolio – we’re not afraid to sell if the time is right and the asset is non-core.”

In August 2020, the REIT Manager announced the acquisition of two fully occupied freehold properties in Australia and the UK, and the divestment of its remaining 50% interest in a cold-storage facility in Queensland, Australia.

Robust e-commerce trends also favour the industrial, and in particular, the logistics sector. As an asset class, logistics, which previously ranked third behind commercial and retail properties, has now risen to pole position in terms of demand, Wallace pointed out.

“Over the last six months, the transition towards e-commerce has gathered momentum – there’re structural changes developing in the distribution and delivery of goods to consumers, and these have become part of longer-term industry trends.”

This has been obvious in countries such as Germany, UK and the Netherlands, which are deep and early adopters of e-commerce. “Operators are moving from smaller to larger facilities to exploit economies of scale, while a number of third-party logistics providers are experimenting with the use of drones as part of their delivery systems,” he added.

 

Sustainability Commitment

 

The REIT’s progressive efforts on sustainability have also allowed it to attract and retain as tenants multinational corporations and local companies that place greater emphasis on green issues.

The REIT was named “Industrial – Global Listed Sector Leader” by the Global Real Estate Sustainability Benchmark (GRESB) for the third straight year. It is also the first industrial and logistics property owner to achieve six-star Green Star ratings for industrial facilities in New South Wales, Victoria, and Queensland.

While the outlook for FLCT remains relatively stable, the impact of the pandemic continues to create a challenging operating environment, Wallace admitted.

Additionally, competition for quality assets among investors remains stiff. “Industrials is an increasingly popular asset class in the key markets that we’re in, such as Australia and Europe,” he noted.

Another hurdle is meeting the increasingly advanced specifications from clients. “Some tenants have made significant investments in sorting and automation equipment, and these equipment are sometimes worth more than the building itself. So we need to be able to customise the set-up of such specialised facilities for them.”

Other issues that keep Wallace up at night include foreign currency movements and portfolio occupancy rates.

“We derive a significant portion of FLCT’s income from Australia, Europe and the UK, but distributions are delivered to investors in Singapore dollars,” he said. “The Aussie dollar can be volatile at times, and that’s what I’m always monitoring, as well as ensuring that our tenant retention rates remain high.”

“The one thing I’m proud of, is that over the last four years since listing, our portfolio has shown itself to be solid and reliable, performing in both challenging as well as good times.”

As at 30 September 2020, FLCT’s portfolio had an occupancy rate of 97.5% and a weighted average lease expiry (WALE) of 4.9 years. Aggregate leverage stood at 37.4%, with borrowings totalling S$2.5 billion, of which 54.6% were at fixed interest rates.

Its portfolio was valued at approximately S$6.2 billion, up from about S$3.2 billion a year ago, post-merger and acquisitions, as well as following a valuation uplift of its investment properties.

Work may be all-consuming, but Wallace makes it a point to spend time with his son, 19, and daughter, 17. “I always emphasise to them the benefits of hard work, and at the same time, the importance of enjoying life to the fullest – because you only have one.”

“Last but not least, they must always remember that every problem has a remedy,” he added. “Whatever challenge you are facing, there’s always a way through it – it may not be a fantastic solution, but it’s a solution, nonetheless.”    

 

Frasers Logistics &amp; Commercial Trust

Frasers Logistics &amp; Commercial Trust (FLCT) is a Singapore-listed REIT with a portfolio comprising 100 industrial and commercial properties, worth approximately S$6.2 billion, diversified across five major developed markets – Australia, Germany, Singapore, UK and the Netherlands. FLCT was listed on SGX Mainboard on 20 June 2016 as Frasers Logistics &amp; Industrial Trust and was subsequently renamed Frasers Logistics &amp; Commercial Trust on 29 April 2020,  following the completion of the merger with Frasers Commercial Trust. FLCT’s investment strategy is to invest globally in a diversified portfolio of income-producing properties used predominantly for logistics or industrial purposes located globally, or commercial purposes or business park purposes located in Asia Pacific or Europe (including UK). 
FLCT is sponsored by Frasers Property, a multinational owner-operator-developer of real estate products and services across the property value chain. Listed on SGX Mainboard and headquartered in Singapore, Frasers Property’s assets totalled approximately S$38.7 billion as at 31 March 2020.

The company website is: <a href="http://www.frasersproperty.com/reits/flct">www.frasersproperty.com/reits/flct</a> 
Click <a href="https://www.sgx.com/securities/equities/BUOU">here </a>for the company's StockFacts page. 
For the full year ended 30 September 2020 financial results, click <a href="https://links.sgx.com/1.0.0/corporate-announcements/BYINOS7O39I81KIY/638163_FLCT_FY2020_Results_Press_Release.pdf">here</a>.

 

About kopi-C: the Company brew

Text: Jennifer Tan-Stanisic Photo: Company file kopi-C is a regular column on the SGX Research website that features C-level executives of leading companies listed on Singapore Exchange. These interviews are profiles of senior management aimed at helping investors better understand the individuals who run these corporations. 
For previous editions of kopi-C: the Company brew, please click <a href="http://edm.sgx.com/a/hBd-CspB86%24MfB90noBAABR54ZH/link10">here</a>.   
For more information, or if you would like your senior executives to be featured on SGX Market Dialogues, please send suggestions to <a href="jennifer.t@sgx.com">jennifer.t@sgx.com</a>.
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    Robert Wallace


Property veteran Robert Wallace dreams boldly, with both feet firmly planted on the ground.

“For me, it’s all about setting realistic, but ambitious, goals, and delivering on them,” said the Chief Executive Officer of the manager of SGX-listed Frasers Logistics &amp; Commercial Trust (FLCT), which was created by the S$6.0 billion merger between Frasers Logistics &amp; Industrial Trust (FLT) and Frasers Commercial Trust (FCOT) earlier this year.

“In whatever I do, I make sure I deliver on my promises – I guess you could describe me as dependable,” he smiled.

Wallace, who holds a Bachelor of Business (Property) from RMIT University and a Postgraduate Diploma in Applied Finance and Investment from Financial Services Institute of Australasia, began his career as a property valuer in Melbourne.

American author Mark Twain once famously wrote: “Find a job you enjoy doing, and you will never have to work a day in your life”, and Wallace is living proof of that.

“This is one mantra I stand by – I wanted to do something that I would enjoy, something tangible and concrete, so I chose real estate,” he said.

“You can easily achieve successful results with property once you understand the dynamics involved,” he added. “For every piece of real estate, there is a formula behind it. Once you understand that formula, in terms of its drivers and markets, you can always add value.”

Wallace has been CEO of the manager of FLCT since the trust’s listing on SGX in 2016. Before this appointment, the 49-year-old held senior management roles in Frasers Property Australia, formerly known as Australand Property Group. In the early 2000s, he was a Fund Manager at MAB Funds Management. Prior to that, he worked in advisory positions in Jones Lang LaSalle and Charter Keck Cramer.

The merger between Frasers's logistics and commercial REITs to form FLCT, proposed last December by way of a trust scheme of arrangement, was completed in April.

FLCT now has a mandate to principally invest in a portfolio of income-producing real estate used predominantly for logistics or industrial purposes, located globally, and/or commercial purposes or business park purposes, located in the Asia-Pacific region or Europe.

Its portfolio comprises 100 industrial and commercial properties, diversified across five major developed countries – Australia, Germany, Singapore, the UK and the Netherlands.

 

Opportunistic Focus

 

The REIT’s Sponsor is Mainboard-listed Frasers Property, a multinational owner-operator-developer of real estate products and services with total assets of about S$38.7 billion as at 30 September 2020. Its businesses span five asset classes – residential, retail, commercial &amp; business parks, industrial &amp; logistics, as well as hospitality.

The Sponsor has operations in Southeast Asia, Australia, Europe and China, and its well-established hospitality business owns and/or operates serviced apartments and hotels in more than 70 cities and 20 countries across Asia, Australia, Europe, the Middle East and Africa.

Expanding in the markets FLCT already has a presence in, as well as leveraging on its Sponsor’s right-of-first-refusal (ROFR) pipeline, will drive the REIT’s medium- to longer-term growth, Wallace noted.

“We’ll take advantage of our strong presence on the ground, as there are plenty of opportunities in our existing markets. We’re now of a sufficient size to hold developmental assets and enjoy the enhanced returns that such assets will bring.”

Strategic and accretive acquisitions are also on the cards. “We’re looking to buy from a medium- to long-term perspective, not just short-term,” Wallace noted.

“What we tend to do is grade all of our assets – we have about 100 properties within our portfolio – and for any new asset that we look at, hopefully we can put it in the top at least 25% of our portfolio in terms of returns to justify why we would acquire it,” he added.

FLCT applies the same rigour to its divestments. “We’re a reasonably active manager of our portfolio – we’re not afraid to sell if the time is right and the asset is non-core.”

In August 2020, the REIT Manager announced the acquisition of two fully occupied freehold properties in Australia and the UK, and the divestment of its remaining 50% interest in a cold-storage facility in Queensland, Australia.

Robust e-commerce trends also favour the industrial, and in particular, the logistics sector. As an asset class, logistics, which previously ranked third behind commercial and retail properties, has now risen to pole position in terms of demand, Wallace pointed out.

“Over the last six months, the transition towards e-commerce has gathered momentum – there’re structural changes developing in the distribution and delivery of goods to consumers, and these have become part of longer-term industry trends.”

This has been obvious in countries such as Germany, UK and the Netherlands, which are deep and early adopters of e-commerce. “Operators are moving from smaller to larger facilities to exploit economies of scale, while a number of third-party logistics providers are experimenting with the use of drones as part of their delivery systems,” he added.

 

Sustainability Commitment

 

The REIT’s progressive efforts on sustainability have also allowed it to attract and retain as tenants multinational corporations and local companies that place greater emphasis on green issues.

The REIT was named “Industrial – Global Listed Sector Leader” by the Global Real Estate Sustainability Benchmark (GRESB) for the third straight year. It is also the first industrial and logistics property owner to achieve six-star Green Star ratings for industrial facilities in New South Wales, Victoria, and Queensland.

While the outlook for FLCT remains relatively stable, the impact of the pandemic continues to create a challenging operating environment, Wallace admitted.

Additionally, competition for quality assets among investors remains stiff. “Industrials is an increasingly popular asset class in the key markets that we’re in, such as Australia and Europe,” he noted.

Another hurdle is meeting the increasingly advanced specifications from clients. “Some tenants have made significant investments in sorting and automation equipment, and these equipment are sometimes worth more than the building itself. So we need to be able to customise the set-up of such specialised facilities for them.”

Other issues that keep Wallace up at night include foreign currency movements and portfolio occupancy rates.

“We derive a significant portion of FLCT’s income from Australia, Europe and the UK, but distributions are delivered to investors in Singapore dollars,” he said. “The Aussie dollar can be volatile at times, and that’s what I’m always monitoring, as well as ensuring that our tenant retention rates remain high.”

“The one thing I’m proud of, is that over the last four years since listing, our portfolio has shown itself to be solid and reliable, performing in both challenging as well as good times.”

As at 30 September 2020, FLCT’s portfolio had an occupancy rate of 97.5% and a weighted average lease expiry (WALE) of 4.9 years. Aggregate leverage stood at 37.4%, with borrowings totalling S$2.5 billion, of which 54.6% were at fixed interest rates.

Its portfolio was valued at approximately S$6.2 billion, up from about S$3.2 billion a year ago, post-merger and acquisitions, as well as following a valuation uplift of its investment properties.

Work may be all-consuming, but Wallace makes it a point to spend time with his son, 19, and daughter, 17. “I always emphasise to them the benefits of hard work, and at the same time, the importance of enjoying life to the fullest – because you only have one.”

“Last but not least, they must always remember that every problem has a remedy,” he added. “Whatever challenge you are facing, there’s always a way through it – it may not be a fantastic solution, but it’s a solution, nonetheless.”    

 

Frasers Logistics &amp; Commercial Trust

Frasers Logistics &amp; Commercial Trust (FLCT) is a Singapore-listed REIT with a portfolio comprising 100 industrial and commercial properties, worth approximately S$6.2 billion, diversified across five major developed markets – Australia, Germany, Singapore, UK and the Netherlands. FLCT was listed on SGX Mainboard on 20 June 2016 as Frasers Logistics &amp; Industrial Trust and was subsequently renamed Frasers Logistics &amp; Commercial Trust on 29 April 2020,  following the completion of the merger with Frasers Commercial Trust. FLCT’s investment strategy is to invest globally in a diversified portfolio of income-producing properties used predominantly for logistics or industrial purposes located globally, or commercial purposes or business park purposes located in Asia Pacific or Europe (including UK). 
FLCT is sponsored by Frasers Property, a multinational owner-operator-developer of real estate products and services across the property value chain. Listed on SGX Mainboard and headquartered in Singapore, Frasers Property’s assets totalled approximately S$38.7 billion as at 31 March 2020.

The company website is: www.frasersproperty.com/reits/flct  
Click here for the company's StockFacts page.  
For the full year ended 30 September 2020 financial results, click here.

 

About kopi-C: the Company brew

Text: Jennifer Tan-Stanisic Photo: Company file  kopi-C is a regular column on the SGX Research website that features C-level executives of leading companies listed on Singapore Exchange. These interviews are profiles of senior management aimed at helping investors better understand the individuals who run these corporations.  
For previous editions of kopi-C: the Company brew, please click here.    
For more information, or if you would like your senior executives to be featured on SGX Market Dialogues, please send suggestions to jennifer.t@sgx.com.



Frasers Logistics & Commercial Trust Pursuing Strategic Opportunities