Suntec REIT

Suntec REIT: The Company reported earnings in-line with expectations on 22 Jan- drop in y/y performance was largely due to the closure of Suntec SG, and Suntec City Mall (Phase 1) for asset enhancement works and the divestment of CHIJMES, although this was partially mitigated by higher office income. Occupancy rates for Suntec office remains very firm at 100% for the third consecutive quarter while Park Mall office slipped to 94.6%. Phase 1 of Suntec Mall AEI which will complete by Mar 2013 is now 83% pre-committed while phase 2 which is expected to commence works in 2Q13 is now 37% pre-committed. CLSA has Suntec REIT as their top pick in Singapore, stating that a potential earnings surprise is possible with Suntec's financial capacity. CLSA downgrades Suntec to OUTPERFORM given the good share price performance year to date, with a TP of $1.74.