2 Key Insights from Suntec Real Estate Investment Trust’s Chief Executive Officer

Suntec Real Estate Investment Trust (SGX: T82U) was listed in 2004 and is one of the largest REITs in Singapore.

As its name suggests, Suntec REIT has a significant stake in Suntec City. But there’s more to the REIT. It also has a one-third interest in each of One Raffles QuayMarina Bay Financial Centre (Tower 1 and Tower 2), and the Marina Bay Link Mall. In addition, the REIT has interests in two commercial buildings in Australia.

There may be interesting things for investors to learn from Suntec REIT. Last week, Chan Kong Leong, the chief executive officer of Suntec REIT’s manager, was featured on the kopi-C interview series by stock exchange operator Singapore Exchange.

Here are two key insights from the interview I picked out that may be useful for investors.

1. Back to fundamentals

Chan shared his perspective on managing the REIT:

“I’m fundamentally a real estate guy – I’m always interested to see how the physical asset can be used to generate economic and social benefits, and how different communities develop around a space.”

In the context of Suntec REIT, Chan is looking at how management is able to use a major property such as Suntec City to derive social and economic benefits. The next comment below provides an interesting take on how Chan views Suntec City as an ecosystem, rather than just a building.

2. The Suntec ecosystem

Chan provided some figures to put Suntec City’s popularity into perspective:

“Last year, Suntec City Mall attracted a footfall of 39.9 million. Our convention and exhibition centre hosted more than 1,400 trade and consumer events.”

Beyond the numbers, Chan views Suntec City as a diverse ecosystem where shoppers, trade convention attendees, retail tenants, and office tenants come together. Between the sizable shopper footfall and the diverse communities within the space, Chan said that this could present an opportunity for the REIT:

“There is a huge latent potential that can be tapped within the Suntec ecosystem, by using technology to connect all the communities together.

We’re working on how to open access to this pool of potential customers for the B2C tenants in our office towers. Think about the value proposition when a lease of office space at Suntec City comes with access to this huge pool of customers.”

The comment above provides a deeper insight on how Suntec REIT is thinking about tapping on its large pool of shopper traffic to attract office tenants. We will have to observe how Suntec REIT is able to turn this concept into reality.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice.The Motley Fool Singapore has recommended shares of Singapore Exchange. Motley Fool Singapore contributor Chin Hui Leong owns units in Suntec Real Estate Investment Trust.