FCT 1HFY26: Northpoint Absorbed, Borrowing Costs Compressing, AEI Pipeline Loaded

Frasers Centrepoint Trust 1HFY26 (six-month period ended 31 March 2026) delivered Gross Revenue of $221.9M (+20.3% YoY), Net Property Income of $160.8M (+20.2% YoY), Distribution to Unitholders of $125.0M (+13.6% YoY), and DPU of 6.136 cents (+1.4% YoY) to be paid on 29 May 2026. Committed occupancy stands at 99.8% (up from 98.1% in the previous quarter), portfolio rental reversion was +6.5% on an average-to-average basis, and the cost of borrowing compressed to 3.2% in 2QFY26 from 3.5% in 1QFY26 — and from the 3.9% 1H average a year earlier. The headline DPU growth of 1.4% is the smaller story in this print. The structural reshaping that 1HFY26 captures is the first full-period contribution from the $1.17 billion Northpoint City South Wing acquisition completed in May 2025, a balance sheet that has continued to compress borrowing costs even as gearing has stepped up to support the deal, and an AEI pipeline that is now running on two tracks with a third loading.

Gross Revenue $221,868K (+20.3% YoY). Net Property Income $160,761K (+20.2% YoY). Distribution to Unitholders $125,041K (+13.6% YoY). DPU 6.136 cents (+1.4% YoY). Aggregate leverage 40.0% as at 31 March 2026 (vs 38.6% at 31 March 2025). Average cost of borrowing 3.2% in 2QFY26 (vs 3.5% in 1QFY26; vs 3.9% 1HFY25 average). Interest Coverage Ratio 3.59x (vs 3.28x at 31 March 2025). Approximately two-thirds of total borrowings hedged to fixed interest rates. Average debt maturity 3.92 years following refinancing of the entire FY26 debt during the quarter. Adjusted NAV per unit $2.19 as at 31 March 2026 (vs $2.17 at 30 September 2025). Committed occupancy 99.8% (vs 98.1% at the previous quarter). Portfolio rental reversion +6.5% on an average-to-average basis (vs +9.0% in 1HFY25, the latter excluding Tampines 1 due to its FY23-FY24 AEI). Over 289,100 sqft of new leases and renewals signed in 1HFY26. Shopper traffic +1.8% YoY. Tenants' sales +3.2% YoY. Assets under management approximately $8.4 billion (vs $7.1 billion at 1H25). Singapore retail portfolio approximately 3.0 million sqft of net lettable area with over 1,900 leases (vs 2.7 million sqft and over 1,700 leases at 1H25). 48 new-to-portfolio tenants committed in 1HFY26 (vs 41 in 1H25). Electricity costs fully hedged for FY26, partially hedged for FY27.

The $1.17 billion acquisition of a 100% interest in Northpoint City South Wing was announced 25 March 2025 and completed in May 2025, funded by approximately $421.3 million raised through a private placement and preferential offering. 1HFY26 captures the first full six-month contribution from the asset, and it shows up cleanly at the top line — Gross Revenue moved from $184.4M to $221.9M, an addition of $37.5M, or 20.3% growth. NPI moved $133.7M to $160.8M, an addition of $27.1M, or 20.2% growth. Distribution to unitholders grew 13.6%, but DPU grew only 1.4% — a six-percentage-point gap that is the dilution from the new units issued to fund the deal. NAV per unit, however, moved from $2.17 (at 30 September 2025) to $2.19 — confirming that the absorption is accretive at the unit level, not just the asset level. Acquisitions of this size at this leverage level usually print a flat or marginally negative DPU result in their first full period; +1.4% DPU growth alongside +$0.02 of NAV accretion in the same six months is the cleaner read on whether the acquisition maths is working. It is.

2. COST OF BORROWING 3.9% → 3.2% IN TWELVE MONTHS — A 70-BPS COMPRESSION ON $8.4B AUM AT 40% LEVERAGE:

The balance-sheet half of the absorption story. Cost of borrowing trajectory: 4.0% in 1QFY25 → 3.9% 1HFY25 average → 3.5% in 1QFY26 → 3.2% in 2QFY26. That is a 70-basis-point compression in the latest quarterly print versus the year-ago first-half average, executed at a leverage level that has stepped up from 38.6% to 40.0% (the move funded by Northpoint's debt component). Interest Coverage Ratio improved to 3.59x from 3.28x. The Manager refinanced its entire FY26 debt expiring during the quarter, extending average debt maturity to 3.92 years, with two-thirds of total borrowings now hedged to fixed rates. The headline read is that capital cost is moving in the unitholder's favour faster than gearing is moving against them — the offset that the +20% revenue / +1.4% DPU framing alone does not surface. Singapore swap rates moving in 2026 set the macro backdrop for the compression; the Manager's hedge mix and refinancing execution determine how much of that move passes through.

The number that needs honest framing. Rental reversion compressed from +9.0% (1HFY25, on an average-to-average basis, excluding Tampines 1 due to its prior AEI) to +6.5% (1HFY26, average-to-average). That is a real deceleration and the publication's job is not to bury it. Three contextual reads matter. First: 1HFY25's +9.0% benefited from the post-AEI lift at Tampines 1 once it returned to the comparable base; 1HFY26's number is on a tighter, more representative portfolio. Second: 289,100 sqft of new leases and renewals were signed in 1HFY26 at this reversion rate and at 99.8% committed occupancy — that is durable pricing power, not weakness. Third: tenants' sales were +3.2% YoY and shopper traffic +1.8% YoY, both supportive of rental affordability. The +6.5% number reads as suburban-retail mid-cycle pricing — strong by any global retail-REIT comparison, normalised from the post-COVID recovery peak. Whether it compresses further in 2HFY26 is the watch-point; the operating data does not currently signal that it should.

The execution proof. The Hougang Mall AEI commenced in April 2025 with 64% of AEI space pre-committed. Twelve months later, that figure stands at over 88% — a 24-percentage-point gain in pre-commitment as the works progressed through Phase 1 (delivered November 2025) and into Phase 2 (on schedule for September 2026 completion). The Manager has confirmed the AEI is on track to achieve its target return on investment of 7%. For a property as small as Hougang Mall, the absolute capital impact on portfolio NPI is modest; the disclosure value is in what the leasing momentum signals about suburban-retail demand more broadly. 88% pre-commitment six months ahead of completion is what an under-supplied catchment looks like when refreshed retail capacity comes online.

The forward pipeline. NEX (in which FCT holds a 50% effective interest) will undertake AEI works to unlock additional retail and office space, commencing May 2026 — one month after this update. The Manager describes the rationale as further strengthening NEX's position as a key retail hub in the Northeast region, alongside a broader tenant-remix strategy and income-growth initiative. The pipeline timing matters: Hougang Mall completes September 2026, NEX commences May 2026 — meaning FCT will run two AEI tracks in parallel for approximately five months, then transition to NEX as the active project. The Manager has additionally flagged the transformation of Causeway Point into a regional retail hub with refreshed new-to-portfolio retail concepts as a third forward initiative. Continuous AEI capacity utilisation across the portfolio, not gap-quarters between projects, is what turns a steady-state retail REIT into a multi-year value-creation vehicle. The evidence at 1HFY26 is that FCT is running that pattern.

6. THE PORTFOLIO IS NOW $8.4B AUM / 3.0M SQFT / 1,900 LEASES — A STEP-CHANGE IN SCALE FOR THE SUBURBAN-RETAIL CATEGORY:

The platform read that the press release does not foreground but the numbers underneath do. Twelve months ago FCT carried approximately $7.1 billion in AUM with 2.7 million sqft of net lettable area and over 1,700 leases. As at 1HFY26 the portfolio stands at approximately $8.4 billion AUM, 3.0 million sqft NLA, and over 1,900 leases — a $1.3 billion / 0.3 million sqft / 200-lease step-up in scale, almost entirely the Northpoint City South Wing addition. 48 new-to-portfolio tenants were committed in 1HFY26 (vs 41 in 1H25) — the curation pipeline scales with the platform. The Manager's positioning frame is unchanged from prior periods: largest suburban retail mall owner by net lettable area in Singapore, focus on necessity spending and food-and-beverage, proximity to populous residential catchments, connectivity to key transport nodes. What has changed is that the platform is now operating at a scale where the next $1B-or-more acquisition becomes the conversation — pipeline depth, gearing capacity, and equity-market access are all functions of the absorbed-Northpoint state, not the pre-Northpoint state. The 8.4-billion number is the structural disclosure.

The Manager guides that FCT's portfolio is expected to remain resilient given its focus on essential trades and services, mall proximity to populous residential catchments, and connectivity to key transport nodes. Singapore suburban retail demand is described as supported by population growth, rising household income, limited new suburban retail supply, and continued government measures including the CDC vouchers scheme. Electricity costs are fully hedged for FY26 and partially hedged for FY27. The Manager has commenced a partnership with CIMB Singapore on flexible financing schemes for tenants, alongside community programmes engaging seniors at FCT's malls — both initiatives that support tenant sustainability rather than directly impacting near-term financials. Aggregate leverage at 40.0% leaves headroom against the 50% Property Funds Appendix ceiling; ICR at 3.59x and two-thirds-fixed debt provide rate-move resilience. The combination — full Northpoint contribution, AEI pipeline running, balance-sheet capacity preserved — is the position the manager has been working toward over multiple periods.

FCT 1HFY26 is a print where the headline DPU growth of +1.4% understates what has happened. Revenue +20.3%, NPI +20.2%, NAV per unit +$0.02 in six months, cost of borrowing compressed 70 basis points, ICR up to 3.59x, occupancy at 99.8%, 88% AEI pre-commitment at Hougang, NEX AEI commencing in May, $1.3B of AUM step-up versus a year ago — these are the numbers that describe the actual state of the portfolio. The +6.5% rental reversion is a real deceleration from +9.0% a year earlier and the publication frames it honestly: normalisation from a post-AEI-lift comparable, not weakness in the underlying tenant economics. The investment-case framing for FCT post-Northpoint is no longer about whether the acquisition was right; it is about whether the AEI pipeline, the leasing momentum, and the balance-sheet capacity together compound through FY26 and FY27 at a pace that justifies the unit's premium positioning in the Singapore suburban retail category. The 1HFY26 print supports the constructive read.