Frasers Property to combine group's industrial and logistics operations in Australia and Europe with FLT in FY2020

SINGAPORE (July 8): Frasers Property Limited is forming an integrated industrial and logistics platform by combining its industrial and logistics operations in Australia and Europe, and asset and property management of the group’s Singapore-listed Frasers Logistics & Industrial Trust (FLT).

The integrated industrial and logistics platform will become a business unit representing $5.4 billion assets under management (AUM) with integrated development, asset management and third-party capital management capabilities across the group’s core industrial and logistics markets in Australia and Europe.

The integrated operating platform is expected to report as a discrete strategic business unit in FY2020. The integrated platform will be led by Reini Otter (left) as Chief Executive Officer (CEO) and Matt Knox as Chief Financial Officer (CFO), who have both been promoted from Frasers Property’s Australian operations.

Panote Sirivadhanabhakdi, group CEO of Frasers Property, says: “Our industrial and logistics business in Australia and Europe has grown rapidly over the past five years, from $1.6 billion to $5.4 billion. We are building upon our multi-national industrial and logistics capabilities to better support the group’s growing investment in this asset class for the long-term, in a focused and integrated fashion.”

“We believe this integration will allow us to better serve the needs of our customers, scale faster and more effectively through active asset creation and strategic asset management. Our growth to date has been driven by a combination of asset creation and entrepreneurial acquisitions in a core asset class for the group.”

As the S-REIT sector — now 17 years old — evolves, there is a clear gravitation towards size, reported The Edge Singapore recently. This is because larger REITs with known sponsors boast liquidity, institutional interest, access to capital and debt, and lower cost of capital and debt. These in turn make it easier to acquire properties to grow distributions per unit and assets under management, leading to a virtuous circle.

Less that a week ago on July 3, CapitaLand announced the merger of its two hospitality trusts — Ascott Residence Trust (ART) and Ascendas Hospitality Trust (AHT). The combined real estate investment trust will own 88 properties with 16,000 units in 39 cities in 15 countries valued at $7.6 billion.

Last November, ESR-REIT completed its merger with Viva Industrial Trust while OUE Commercial REIT is merging with OUE Hospitality Trust.