Frasers Centrepoint Trust (J69U) Earnings Call Transcript & Summary

Good morning, everyone. Thank you for joining in Frasers Centrepoint Trust 3Q FY '26 Business Updates Earnings Briefing. I've got here with me today the senior management team, Richard, who is our CEO; Annie, who is our CFO; as well as Pauline, our Managing Director for Investment and Asset Management. As you can see from the contents, we've got a lot to go through today. So without further ado, I'll pass it on to Richard.

Thanks, Judy. Good morning, everybody. So let's get down to business. For this quarter, we decided to -- instead of jumping straight into the business updates, we also included the recent activities that happened around itself. The first one being the divestment of White Sands. Next slide, please. Okay. Not going to go into every detail here, but just a couple of quick highlights. The property was transacted at $467 million, and the last valuation was done at $431 million. So that kind of gave us a net gain of approximately 32.4%. And this transaction is also at a premium to the valuation at about 8.4% and the entry -- or rather the exit yield based on 2025 year-end NPI is about 4.6%. So some of the key rationale you can see there, of course, one of the main one is actually the reduction of our gearing from 40% to 36.5%, thus giving us a little bit of headroom for us to again look out for opportunities in the market, which we did, and I'm going to share shortly as well. Okay, these are just some information on White Sands. Probably most of you are familiar with this. Also, just a couple of highlights. The leasehold for this asset has gone down to about 67 years. And it's also the smallest size mall in our portfolio at about 150,000 square feet. So some of those are also considerations we take into effect when we look at the divestment of this asset. Next slide. So what are the end product with this divestment? Aggregate leverage dropped to 36.5%, giving us a good headroom. NAV actually went up because we divested at a premium. There's a slight dilution of DPU by about 1.9%, right? Okay. Next slide, please. Okay, so what did we do with the headroom that we have managed to obtain from the divestment of White Sands? We participated with the sponsor FPL and our joint venture partners in this Bayshore Drive Site. The one, as you can see that is with the yellow star on the right side of this pictogram, right? Okay, next slide, please. Okay, very quick run-through on some of the key details. Site area is about 618,000 square feet. What we did is the tender price is about $2.1 billion. But more importantly, the total development cost for the retail portion is approximately $613 million. The GFA for the commercial site is -- or the commercial portion is about 238,000, if you round that up. And the estimated NLA ranges between 160,000 to 180,000 square feet. It is a good sizable mall if we can reach the upper limit of this NLA. Our joint venture partners, Sunway-MCL and also Sekisui House. The target completion for this project is roughly end 2030. So it takes about 4 years of construction. Next slide. So some of the key highlights of this site. Of course, I mean, most of us or if not all of us are familiar with the precinct itself. This is a Bayshore precinct, an area where it has got high-density population and also, I would say, a pretty high income range for this whole precinct itself, right? So this will be the only commercial site in this whole precinct. And it's in a location where it also encompass part of the Bedok region as well, right? And what is important is also when we look at our investment criteria, one of such is definitely looking at connectivity. And this site, again, it's on a light car-lite precinct and it has a direct connection with Bedok South MRT station and also a new bus interchange. The population is expected to continue to grow, as you can see from this diagram. Some of those developments that you can see here are actually -- will be coming on stream. So we are expecting around 10,000 new homes that has been planned and will be developed around this mall itself. And the site itself, I mean, FPL and its partner will be actually building about 1,280 residential units. Of course, this site is also close to other amenities. It's going to be located next to the largest Safra clubhouse, which is also due to open in 2030. So a lot of amenities, growing population and very good connectivity. Next slide, please. Yes. So these are some strategic rationale. Some of them I've mentioned before. Definitely, it fits into our criteria of a prime suburban mall with a very good connectivity, with a growing population. And also, if you look at it, this also gives us an opportunity to be looking at development as a new growth driver, right? I mean the question is always about what's next? Is there malls for us to purchase? What are the opportunities available? So this will give us a new opportunity to look into. And I would say that not every developer or not every REIT in Singapore has this capability. So it's just a couple of us who can partner with our sponsors to do this kind of thing, right? So in a way, that will give us an opportunity as a new source of growth. This site is -- has -- sorry, excellent location. That's something that I mentioned just now. Of course, the other critical part is if you get into a development of such, in a way, we are entering at a very attractive yield. So the yield on cost is approximately 5%. We divested White Sands at 4.6%. So you can see that kind of arbitrage that we can make if we are able to get into a development project. And by participating from the onset, it also gives us the opportunity to shape the direction of the mall that we wanted to be, how we want the mall to be positioned, et cetera, right? And I talked about the fact that this is a very highly populated region in Singapore. And the retail space per capita in this area is actually significantly lower than the Singapore average and also most part of Singapore as well. Next slide. Okay, then now turning back to the BAU or the business as usual in terms of the -- some of the key highlights for this quarter. Committed occupancy remained very strong. Again, it's over 99% with some frictional vacancy while we churn out some of the spaces. Year-to-date shopper traffic and tenants' sales continue to be positive. Traffic gone up by 2% year-on-year on a year-to-date basis and also tenants' sales at 1.8%. Capital management. Here, you see we actually stated the gearing at 40.4%, but that's because the completion of White Sands is going to take place sometime in September. But if you take that into consideration, our gearing would have come down to 36.5%. And the other positive thing to note is also the cost of funding has continued to come down. So we are looking at 3% for this third quarter. Hougang Mall AEI update, we will go into a little bit more detail, but happy to say that we are on track to complete and over 98% of the space has already been pre-committed. NEX AEI is also progressing very well. Phase 1 achieved 87% commitment and also 73% of those spaces at this phase is actually new to mall brands and concepts. High-level macroeconomics. GDP, we are still looking at 2% to 4% for this year. Surprisingly, Q2 actually came in pretty strong at 5.7%, but MTI has kept that estimate of 2% to 4%. Core inflation for June, it came in at 1.6%, but they also maintain the inflation estimate to be around 1.5% to 2.5%, right? Hopefully, the announcement by MAS can also kind of kept the core inflation in check as well. Retail sales for Singapore on a whole year-to-date, it's about 3.3% and FCT came in at 1.8%. Of course, the Singapore sales figures also include the entire sales, right? I mean, those that happen in Orchard Road online, et cetera, right? Ours is just purely our portfolio. F&B sales, Singapore as a whole, 1.1%. For FCT, we grew at 2.1%. Rental, again, similarly, we are also on an upward trend comparing the market as a whole for suburban prime retail rents as expected or actually grew by 1.4% year-on-year. Next slide. In terms of supply, continues to be limited, especially if you look at significant suburban space, right? So between 2026 to 2029, we are looking at close to about 447,000 square feet of suburban space. But these are actually multiple sites, right? The largest probably is the one in Parktown 107,000 square feet. And then you -- sorry, the one in Chencharu is about 130,000 square feet, right? The rest are about 100,000 square feet and so on. So it's quite fragmented. It's more you would deem as a neighborhood center rather than a pure prime suburban mall. So limited supply is expected for the next couple of years. Next up is the financial highlights. I'll hand over to Annie.

Thanks, Richard. Good morning, everyone. A quick update from me on the financial highlights for this quarter. As mentioned earlier, I think gearing for this quarter stood at 40.4%, which increased slightly from last quarter. On a pro forma basis, post White Sands divestment, the gearing would be approximately 36.5%. The interest coverage ratio remains healthy at 3.66x. Cost of debt for the quarter is around 3%, which is a decrease of 20 basis points from last quarter and a 70 basis point reduction year-on-year. We expect that the full year cost of debt for this year to be around 3.2%. Around 2/3 of our debt is fixed at quarter end and our credit rating for Moody's remain unchanged at Baa2 stable. Next slide, please. Refinancing in FY 2026 has been completed. The next refinancing will be the first quarter of 2027, and we have commenced discussion with the banks on the refinancing. With the refinancing that was done this year, the debt maturity profile is -- you can see that it is well staggered and there is no more than 30% borrowing that is due in current financial year. Yes, I think with this, I will hand over to colleague, who will walk us through the portfolio and AEI highlights. Thank you.

Thank you, Annie. Good morning, everyone. I'll just -- I think Richard has touched on some of these key performance metrics, but I'll try to provide a little bit more flavor as I go through the slides. On this slide, you see committed occupancy. So committed occupancy for the portfolio has maintained at the high 99% for this quarter. You see that consistently over the past quarters-or-so, the occupancy has maintained at this good level. The quarter-to-quarter fluctuations is largely due to tenancy churn because one area of focus for us is also constantly improving and enhancing the trade mix for our malls, and that entails to a certain extent, some downtime. Next slide, please. So on this slide, you see that both shopper traffic as well as tenants' sales have maintained upward trajectory, both on a quarter-to-quarter basis as well as year-on-year -- year-to-date basis, right? So in terms of shopper traffic for -- on a year-to-date basis, we have actually increased the shopper traffic by 2% and also tenants' sales by 1.8%. In terms of looking at the tenant sales for the quarter, we do see that it's at 0.2%. Arguably, it's a little bit flattish, but then that's due to the churn as well as the refresh that's undergoing in our portfolio. So just to give a couple of larger examples, say, for example, at Tiong Bahru Plaza, we have actually recovered the cinema space and we are repurposing that for indoor activity park. And the other example would be at Northpoint City, whereby we have -- we are looking at repurposing, again, the gym space into a duplex, right, for unit growth. So all this is in view of the fact that we need to actually maintain the relevance of our offerings, right? We've also looked at the sales productivity of our portfolio. So on total basis, the sales productivity of our portfolio has continued to improve somewhere in the region of 3%, more than 3%. When we deep dive further, we do see that the top few trades that contribute more than -- close to 80% of our total sales have actually shown an increase, right? So the top 3 trades, for example, would be the likes of F&B, beauty and health care as well as supermarket. So that lends credibility to the fact that our portfolio being very much focused on convenience, necessities, nondiscretionary remains very resilient and robust in terms of trading performance. Next slide, please. So this slide, we look at the WALE, 1.7 years, very -- it shows very stable cash flows. And if you look across the lease expiries in the medium term, looking out, say, over the next 3 years-or-so, we do not see any concentration risk in terms of lease expiry. To date, we have derisked or rather as at the end of the third quarter of this financial year, we have derisked more than 80% of the leasing stock in FY '26. So we are left with 4.9% by GRI. And a lot of these -- or the bulk of these are actually in advanced or documentation stages as we speak, right? Next slide, please. I think a key focus that I alluded to earlier is that there's always a need to maintain the balance between protecting the occupancy and also updating offering, right? So refreshing the trade mix ensures that our portfolio of malls continue to be relevant to its shoppers. But of course, that would entail some short-term pain in terms of downtime, right? So over the course of FY '26, we have brought in 69 new-to-portfolio tenancies. And just to highlight that these are new-to-portfolio, right? So there would also be for the respective -- for the various malls, new-to-mall brands that we are bringing in that is not included in this 69 count. And all this lends diversity to our offering. So you see that it's a mix of not just F&B, but also across the different trades, lifestyle as well as fashion, right? So my take on this is that the Singapore retail market continues to remain active. Tenants are prioritizing the prime malls to actually expand their market presence. Next slide, please. This slide shows or demonstrates our focus on driving traffic to malls and also driving the sales conversion. So a lot of hard work on the ground by the team in terms of sustaining the positive sales growth trajectory. And there's a lot of focus on bring the experiential to our shoppers, right, engaging them. And that's all with a view of fostering shopper loyalty as well as repeat visitation. Next slide, please. Okay, so I'll cover a little bit about the asset enhancement initiatives. I think one of the key pillars of our growth would be enhancement growth. How do we actually extract more value from our existing portfolio? So Hougang Mall, which is at its tail end of the asset enhancement, I'm happy to share that in terms of the progress, it's actually on track in terms of project implementation as well as leasing. We are looking at completing the AEI in the last quarter of this financial year. And if you recall, when we first shared this asset enhancement initiative, we provided an indication of about 7% ROI. So happy to say that we are on track, if not looking at outperforming this ROI, right? And through this AEI, we have transformed the mall, not just upgraded the physical real estate, we have also improved its trading potential in terms of sales, in terms of rents and also looking at valuation, delivering valuation uplift to the investors. Okay. Next slide, please. In terms of the other larger AEI that we have are working on. For NEX, we have actually commenced Phase 1 in May of this year after taking back the space from Isetan. The first phase is focused on unlocking value through resizing and reconfiguring this anchor space. So happy to share that for this first phase, we have also achieved pretty healthy leasing traction, right, in terms of commitment of leases, in terms of getting our target brands to reposition the space. And the new-to-mall, we have -- for this Phase 1, we have achieved 73% new-to-mall brands and concepts. So looking positive in terms of some of the trade remixing and the value enhancement objectives that we have set ourselves to, right? And Phase 2 is also on track for commencement. We are looking at starting in the first quarter of the calendar year 2027. ESG.

Yes. Thanks, Pauline. Yes, I'll go through some of the slides on the ESG part, as usual, to make sure that we have a comprehensive review. So as you know, for Frasers as a whole, we are very active in terms of the placemaking initiatives at our malls. I think from the World Water Day at Northpoint City as well as Hair for Hope, which is a signature event at the mall itself to something for the kids in terms of introducing them to EVs. There's been a lot of initiatives on the ground, again, to continue to engage the community. And as well for all walks of life, shoppers from all walks of life we've got the Silver Generation community walk at Century Square as well and various other sports activities such as pickleball at Tiong Bahru Plaza itself. So in terms of curating the experiences at our malls, there is something for everyone. Okay, I'll next pass it on to Richard, who will go through looking ahead.

Thanks, Judy. Just wrapping up what we have just shared today. A lot of focus, again, is on some of these key pillars. Enhancement growth is something that we have spoke about at large, and we have again proven the capabilities that we have at Frasers in terms of executing, leasing up and also bringing in concepts and also freshness into the mall, right? So we shared about Hougang Mall, we shared about NEX. And I know some of you will be wondering how come we haven't shared about Causeway Point, right? Okay, we are developing the materials, we are developing the flight through and so on, so we just need to make sure that all the documentation are in place, MOU are signed before we can share this. But 4Q, we will be able to share the AEI, may not be the entire extent, but at least some preview of what we have in mind and what the plans that we have for Causeway Point. But AEI is a key component of our growth strategy. The next one is, of course, looking at acquisition, divestment, and we shared about the success that we have achieved in our bid for the Bayshore site. That gives us another new growth opportunity in terms of growing our portfolio through development. And as I mentioned, right, this is a key -- it's going to be one area that is a key differentiator for us as well because not every REIT in Singapore has the capabilities to do so. So we are very happy that we are able to partner with a couple of our partners together with sponsor to win this site. Organic growth. This is where, again, the team works very hard on the ground, looking at how we can continue to grow revenue, how can we continue to look at cost mitigation, right? So this is an ongoing process. For retail mall, it is something that we need to continue to be very focused, continue to be very sharp and work very hard on this particular growth strategy. Capital management. Cost of fund has come down to 3%. And as what Annie pointed out just now, we are expecting to close the year at the full year this FY at about 3.2%, right, average cost of fund. The leverage has come down to about 36.5%. So like what I mentioned, it gives us the headroom, which also provide us the opportunity to participate in the development itself. So with that, I will end our presentation, and let's move on to Q&A because I've seen a lot of hands have really come up. Judy, back to you.

Okay. Thanks, Richard. Okay, first up in the Q&A session, we have from Terence.

Congrats on a very, very busy quarter. Really done well in terms of the sale and also the development opportunity. I just want to ask on Bayshore. I wanted to understand a little bit more. I think working through some of the numbers, we are sort of like for this $613 million, we are getting like almost 3,500 per square foot on NLA. And to get a 5% yield on cost, it sort of suggests that the stabilized rent for the mall will be above $20. So if you compare this against your existing malls across the FCT portfolio, it does seem elevated. So I wanted to understand a little bit more as to what are the assumptions going into this? And can this 5% yield on cost be achieved in the first leasing cycle? Secondly, on Causeway Point, could you share on the NLA for Metro? And what are some of the thoughts behind Metro? When could we see that space return?

Right, Terence, you have been looking at computation of the rent itself. Over more than $20, that is quite sharp, but I don't think this is something that we are targeting, a little bit more conservative than that. But in terms of how we work on the return itself, there are a couple of key features of a mall that we need to recognize as well, right? Firstly, this mall is not a very large mall. It's 160,000, 180,000 square feet. So the tenancies, when the mall of this size, you work on per square foot, it tends to sound a little bit higher than normal as compared to your NEX or Northpoint City. That's the first point. Secondly is in terms of rent itself, there are -- don't forget within the revenue portion, there are also other revenue, right? So rent is only one portion, but we also have other revenue that we can achieve to make up the entire revenue before you offset your cost to get NPI. The next point is also how the mall is going to be structured, right? If you notice for -- generally for retail mall, as you go higher and higher, the rent kind of comes down, right, because rental is always against gravity, right? But for this particular development, we are looking at only 2 levels, basement 1, level 1. So significantly, every part of the mall is going to be pretty much a prime space. So with that and with proper planning, we believe that we could possibly get a pretty strong rental rates. And also, if you look at it today is 2026, I mean, we're looking at 4 years down the road. So there's also this escalation growth that we are looking at from where we are today. So that's how we arrive at our estimated 5% yield, right? So I hope that gives you some color as to how we work around this development, this investment. And of course, at some point in time when we have the plans in place, the development plans in place and so on, we probably can come back and share this with you guys and also with our investors. So the second point is about Causeway point, AEI and in particular, your question is around Metro. I'll share a little bit more then maybe perhaps Pauline can jump in as well. So the news came out on Metro. It's nothing surprising for us because we have been engaging them for a very long time. And we kind of agreed in principle that keeping the department store as is in the current state, it's not something that we as landlord would want to do. And probably as an operator, they came to the conclusion that perhaps there are other ways in which they can be more productive, they can be more efficient, right? So they announced a business restructuring, and that's something that we have been aware for a while. We have been engaging with them, and we see there could be opportunity for us to continue to work with them with their differentiated approach of breaking up a department store into multiple concepts. And then some of the concepts are interesting and will be relevant. But this is an ongoing discussion we have with Metro as we plan our AEI. We are looking at -- as we shared, we are looking at turning Causeway Point, not just as a mall -- a dominant mall in the North area, but also more like a regional mall. So we hope to bring in interesting concept, interesting mini anchors rather than having a very large anchor as what we have today. So that will bring a variety, will bring in more interesting concepts as well. So that is where we are for Causeway Point. I'm not sure whether, Pauline, you like to add on anything as well.

Yes. Just a couple of points. I think in terms of timing, it's pretty much aligned with our plans for the commencement of AEI and the recovery of this space. And also, I think this is something that has been at the back of our minds when we undertake the space planning as well as the trade remixing for Causeway Point. So just to give assurance that this -- whilst this is news, but it didn't come as a surprise to us. We have actually been looking at this option as part of our overall planning for the asset enhancement.

Thanks, Terence. Next up, we've got Yew Kiang Wong from CLSA.

Congrats, good results. Just quickly on the -- recently, there's this RTS impact report, right, $290 million net reduced spending leakage. Has the team done any similar report? And how does it compare with their findings? That's mainly the question I'm trying to figure out. And also, can you share the tenants' sales performance for the last 3 years for CWP and also Northpoint?

Okay. The report, yes, we are very much aware of that. And I don't think it's a significant deviation to what we have shared before, right? I mean we spoke about engaging our own consultant to look at that. CBRE was brought in. And what they have shared with us is also quite in line in terms of the projection, 2% to 4% increase in sales leakage, so to speak, right? So nothing new. Even some of the survey that they have shown about what are the trade that is more -- going to be more significantly affected. And if you had a chance to look through the report, so they made a point that probably those in the northern region, the shoppers are already pretty much used to that, so they -- in fact, they don't see that leakage to be more significant in the north than other parts of Singapore. Again, this is something that we are aware of that. We are cognizant of the fact, right, as we did our own study and also work with our consultants. So by and large, again, but having said that, we continue to watch this space, watch the market. As we plan our AEI, we are taking note of what are some of the trades that we think we will like to reduce, what are the areas that we want to emphasize more going forward. This also talk about this -- besides looking at it from the leakage or impact perspective, there are also a lot of opportunities. And that's where we think we want to leverage on those opportunities as we expand our mall to make it into a regional size mall, having the ability to capture more than just Woodlands catchment market. We want to expand it to potentially other parts of Singapore because this is going to be a major transportation hub, as we spoke, right? Woodlands is an interchange station, right? And where you can expect people from other parts of Singapore who wants to go to RTS would come to this station to change to the train that takes them into TEL line that takes them into RTS. So it's going to be more busy, getting more people coming around. And also not just Singapore, Singaporeans, right? I mean we're expecting tourists who wants to go RTS or go to JB may also be using this route and also using this as a transportation hub to stop and transit. And similarly, people coming from JB, right, they are also going to be coming in because of this convenience and this ease of connectivity. So from a total perspective, the report doesn't seems to suggest anything different than what we have seen, what we have been aware of. And even if you're looking at potential impact, so for example, I mean, if our cost is on the average about 16% and in fact, our 2 assets in the North is slightly below 16%. So the impact of 2% to the sales leakage or 4% to sales leakage, we are still within 16.5%, 16.6%, that kind of range, which is actually still very, very healthy, right? So that's how we look at it. On the sales for the 2 malls, I would say they have continued to grow. I can't give you the specific number, but they have been growing, right? So despite the fact that every weekend is congested, every school holidays, every holiday is massive jam, but the sales at our 2 northern malls have continued to grow.

Okay. Second question is on Bayshore, just housekeeping. Will this be consolidated equity accounted? And then also related to Bayshore, can you give the construction cost and the land cost split? Is it $613 million?

Okay. At the moment, we can't provide that information as yet because we are still -- while we have an estimated cost that is kind of captive, but we are still working through the cost with the partner, right? One of the partners is actually a construction company. So this is not available at this point in time. And even our $631 million (sic) [ $613 million ] is an estimated as of now, right? So we will probably be able to update once we lock in the cost with all the scheme in place, right? So that will be probably at a better time to do so. In terms of how we account it, maybe, Annie, do you want to chime in on that?

Yes, I can do that. Yes, it will be accounted for as equity accounting because it's a JV.

Thanks, Yew Kiang. Next up, we've got [ Geraldine ] from Jefferies.

Very happy to see Bayshore come true. Maybe just first one on Bayshore. 5% yield on development. I see that you have an NLA range there. Does it matter whether you are on the lower bound or the upper bound of that range or does that offset your 5% assumption?

Okay. It's more on the average, I would say, and we are confident of getting that 5%, yes. Average NLA, yes.

Okay. So 170,000 square feet will be the underwriting. Okay. And Richard, I think you've been quite balanced when it comes to income disruption. So would you be keen to pay out some of the dividend gains from White Sands? You have about $30 million buffer there.

Yes. So how we look at this gain is, of course, this is a possibility that we can explore when we can deploy this because as you probably are aware that we are going into a period of time where we're expecting quite significant or rather we expect impact to our normal operating income because of AEI at NEX that's going to go in swing into Phase 2 next year. Then we have AEI at Causeway Point coming on stream, right, for FY '27-'28. So this is where we would leverage on all our capabilities to again kind of top-up some of those impacts that may come on stream. So this amount of income that we have generated will be considered as part of the pool as well.

Thanks, [ Geraldine ]. Can we have Rachel from Macquarie?

Yes. So maybe following up from [ Geraldine's ] question. So you do have quite a bit of AEI that's happening next year actually, Causeway Point, NEX and then -- yes, and they are quite huge as well. So I'm just wondering how are you going to think about capital top-ups and how much left in your divestment gains? And you still have your Bayshore development ongoing also, right, so there will be cash as well there. So can you give us some guidance on this?

Okay. So for Bayshore development, the interest cost is -- will be capitalized. So there is no impact or not significant impact to the overall DPU perspective or DI perspective, right? So we don't need to be too concerned with popping up that portion. But certainly, in terms of AEI, when we have 2 major AEI that's ongoing, that's where we will look at, again, trying not to impact our investors' income during this period. So AMCs will be used. If it's not enough, then that's where we could then look into this income. But we have -- I mean, based on our estimates, we have more than enough for us to ride, so to speak, the next 2 years of disruption. So I suppose the message to investors is don't be overly concerned with all the works in place. We have our strategy in place. And of course, this over $30 million comes in pretty handy as part of the overall planning that we have going forward. So yes, very much -- don't need to worry about whether there's going to be a significant impact to the DI.

Remaining the divestment gains that you have...

Yes, may be able to -- or rather we may consider using part of this income to kind of support the impact or kind of smoothen out, mitigate the impact as a result of those AEI works that's going to take place. And sorry, just to go back one point to [ Geraldine ]. Sorry, my bad. I think the 5% is based on a lower bound of 160,000 square feet. I was just reminded on that.

Okay. Do you have the amount of the remaining divestment gains that you have in your books?

We do have divestment gains from previous divestment. Probably it's not something that we -- I have off the top of my head. But if you look back on some of those divestments, I think you could probably add up the numbers. It's quite significant, yes. But I'm not even looking at past divestment gain. I think with White Sands, I believe, and what we think we can generate over the next 2 years in terms of the performance of our mall, we are more than comfortable that we don't have to look beyond White Sands capital gains.

Okay. Then my next question is on NEX. I think you have committed quite a good...

7%.

Yes. Is it still 7% or is it higher than 7%?

I mean we are only in Phase 1, right, Rachel. So there's a lot more work to go. Of course, if you ask me as of now, the numbers are coming pretty good, strong numbers, but we still have a long way to go. So I'm hopeful that like what we have done with Tampines 1 and also Pauline alluded to the fact that outcome, we are expecting to come in above what we have estimated. And likewise, for NEX, I'm hopeful that we will do likewise. But at least, I think 7% is where our lower bound expectation, yes.

Yes. One last one, just housekeeping. Interest cost this year, very good 3.2%. Any guidance for next year? If you look at the debt that is expiring, your Singapore debt has all been repriced to current rates.

Annie, do you want to take that?

Yes. Rachel, I think you can see from our expiry profile that we only have $100 million refinancing to be done in FY 2027. So with that in mind and the current SORA rate, I think our guidance wouldn't remain too different from what we have given.

So flattish next year?